Even with the President’s desired tax hikes, publicly held debt would rise by $7.7 trillion in 10 years under the President’s budget.
That’s right: Our federal debt would continue growing even if the President gets his way completely in the fiscal cliff negotiations. Until the debate focuses on reining in federal spending, especially in the entitlements, no real progress will be made towards solving the U.S.spending and debt challenges. That is the very reason why Speaker of the House John Boehner (R–OH) told members of his party:
We’re fighting for spending cuts. We’re fighting against increases in tax rates that destroy jobs. And we’re fighting for pro-growth tax reform and entitlement reform, the keys to economic growth.
Not too long ago, in 2009, President Obama himself acknowledged the need for entitlement reform and suggested his willingness to address exploding programs such as Medicare and Social Security. According to The Washington Post:
“What we have done is kicked this can down the road. We are now at the end of the road and are not in a position to kick it any further,” he said then. “We have to signal seriousness in this by making sure some of the hard decisions are made under my watch, not someone else’s.”
In fact, as far back as 2008 when he was running for President, Obama said he wanted to tackle entitlements in his first term (see video above).
Mr. President, the opportunity is here now. Lawmakers kicked the can down the road in the debt ceiling negotiations last August, and Standard & Poor’s downgraded the U.S.credit rating in response. Federal spending will run up to the debt ceiling soon again—as soon as the end of December, according to the Treasury Department—and Congress and the President should put forth real spending cut proposals that address the key drivers of the nation’s spending and debt.
A new paper by Heritage’s J. D. Foster and Alison Fraser lays out six bipartisan entitlement reforms to solve the real fiscal crisis. All the President needs to do is seize the opportunity and show fiscal leadership.