A raging addiction. A fall from great heights. A shocking meltdown before the eyes of the world. No, I’m not talking about Charlie Sheen, I’m talking about the rest of us. I am happy to report that the United States has not yet reached the “tiger blood” phase of its addiction to deficit spending—the point at which hope really begins to fade—but we’re getting there. The sheer numbers involved are oft-repeated, but nevertheless astounding. With our national debt at more than $14 trillion and counting, and with annual deficits well over $1 trillion, America’s fiscal health is set to become the key issue in US politics in the years to come. Our prognosis is not good. The Pentagon’s $700 billion-plus budget is bloated with wasteful handouts to contractors, despite the best efforts of Defense Secretary Robert Gates to impose discipline. Members of both parties pay only lip service to tax reform. Worst of all, the biggest drivers of the debt—entitlement programs like Social Security and Medicare, which account for roughly half of government expenditure—remain untouchable.
The good news is that the American people, and even their esteemed leaders, seem to recognize that we have a problem. Virtually everyone who isn’t on the board of a defense contractor agrees that excess can and must be cut from the defense budget, and few would argue that a simpler tax code would be an altogether bad thing. The bad news is that even these changes, which are widely acknowledged as necessary, would be tough in this political environment. But that’s before we get to the really bad news: while a strong majority of the country wants to fix the deficit, a majority of Americans also opposes cuts to Social Security and Medicare—people acknowledge the problem while ignoring an unavoidable part of the solution As we know, the bulkiness of both programs is half the problem, and that’s even before the Baby Boomers begin retiring by the droves—once they do, their share of the deficit will skyrocket. To be blunt, this country’s attitude toward the growth of the national debt is like that of a heroin addict who says, “At some point in the future, I’ll start to cut back, but I’m keeping at least half my stash. I need it because it’s important. See? I’m cured!”
What we need is an intervention. What we need is an adult who will take seriously the recommendations of last year’s Bowles-Simpson debt commission. As we turn our focus to the 2012 election season, it is absolutely critical that we demand a serious, constructive debate from the President and his Republican challenger. A lasting solution to our fiscal problems will involve real pain: lower discretionary spending, higher taxes, and less generous benefits for the generations of retirees after the Baby Boomers. But if we put the right plan in place within the next presidential term, we can prevent the debt, and in particular, the coming explosion of entitlement spending, from permanently damaging our essential safety net, our economy, and our global power. A number of contenders for the GOP nomination, like Governor Mitch Daniels of Indiana and former U.S. Ambassador to China, Jon Huntsman, appear ready to have that serious conversation with Barack Obama in 2012. Many do not. If the coming election season fails to produce our moment of reckoning, the bond market will: it is has little appetite for Adonis DNA-possessing addicts like Charlie Sheen and Uncle Sam.