Yesterday’s meeting on our country’s fiscal situation, hosted by the Peter G. Peterson Foundation, yielded some notable and worthwhile quotes. The meetings attendees were all experts in fiscal policy and/or the economy or have served in high level, policy-influencing positions. The following are just a few of the comments from yesterday:
“[The deficit is] not a Wall Street problem [but a problem with which all Americans should be concerned]… I’m more worried about this than at any time in my lifetime.” – Robert Rubin, former finance executive and former Treasury Secretary to President Clinton
“We’re in a crisis…” – Lawrence Mishel, president of the Economic Policy Institute
“Paul Ryan who is a Congressman from Wisconsin said it best. He said, ‘this is the most predictable economic crises we’ve had in history.’ And it is. This nation is on autopilot and if we don’t change and make big changes we are going to face disaster.” – Erskine Bowles, Chair of the President’s National Commission on Fiscal Responsibility and Reform and former White House Chief of Staff to President Clinton
“Its very clearly the case that projected spending is substantially in excess of projected revenue. And just arithmetically you need either lower spending or higher revenue or some combination thereof… This issue of our fiscal trajectory is clearly generating increasing concern among the general public.” – Peter Orszag, director of the White House Office of Management and Budget
“We need to ask ourselves, not just is this sustainable, but is it moral? What does it mean to burden our kids to an unconscionable doubling of their taxes?” — Peter G. Peterson former finance executive and chairman of the Peter G. Peterson Foundation
One particularly interesting quote came from Erskine Bowles: “Small business can’t grow and can’t create jobs without what? Capital. And there’s not going to be any capital, it’s going to be crowded out…”
The crux of Bowles’s point is that government won’t be able to invest in new areas without reducing deficits. While we agree with his comments, we unfortunately disagree with his premise. As was found in a study by Public Finance Review, the more money the government spends overall, the slower overall economic growth will be, regardless of what taxes are used to raise the money. Unless government spending is drastically reduced it will, in and of itself, depress private investment and will continue to be a terrible burden our economy.
We applaud the sentiments expressed at yesterday’s meeting. Further, we are encouraged to know that many of our country’s policy leaders agree that our spending and its effect on our deficit and debt is a looming catastrophe. We hope that the President’s Commission on Fiscal Responsibility and Reform will see the forest and not just the trees – that cutting wasteful spending is the easiest and most responsible path toward fiscal security.
