A continuación dejo unas notas de Jay Bryson, economista de Wells Fargo, sobre una reciente conferencia sobre soluciones fiscales: "The 2011 Fiscal Summit: Solutions for America's Future".
I recently attended a conference in Washington, D.C., that was entitled “The 2011 Fiscal Summit: Solutions for America’s Future.” The conference, which was sponsored by the Peter G. Peterson Foundation, featured an all-star cast that included former President Bill Clinton, House Budget Committee Chairman Paul Ryan (R-WI), National Economic Council Director Gene Sperling, Governor Mitch Daniels of Indiana, and members of the so-called “Gang of Six.” This short note summarizes the implications I drew from the conference proceedings for the long-run budget prognosis for the U.S. government.
I have been pessimistic about the long-term fiscal challenges facing the United States. In my view, societies do not make painful choices until they are forced to do so. I have feared that it may require a full-blown debt crisis, such as the one faced by Greece at present, to shock Americans into making the difficult choices that are required to bring our fiscal accounts back to sustainability. However, I flew back to Charlotte mildly encouraged by my observation at the conference that some politicians in positions of authority are making a good-faith effort to find a long-term budget solution.
But will politics in our bitterly divided nation allow us to find that solution? In his remarks, the politically astute Bill Clinton said that Americans are “hungry” for a solution to our budget woes. In reflecting upon the budget impasse that came within 45 minutes of shutting down the federal government about two months ago, I concur with Clinton’s sentiment that a shutdown would have been viewed by many Americans as a colossal failure of the legislative process. Although some die-hard partisans on both sides of the aisle are taking a “my way or the highway” approach to governing, it does seem that many Americans desire that their elected leaders find solutions to the nation’s problems. In Clinton’s opinion, finding a budget solution is in the political interests of our elected leaders; the bums will be thrown out of office if they do not find a solution.
But with Democrats vowing to protect entitlement programs from spending cuts and Republicans steadfastly opposed to tax increases, can the formula for a solution be found? The way forward may involve the reduction of “tax expenditures,” a term that was mentioned repeatedly at the conference by Democrats and Republicans alike. “Tax expenditures” are the innumerable tax credits and deductions included in the business and personal tax codes that end up costing the government revenue. Some analysts consider “tax expenditures” to be government spending by another name.
I was struck by the willingness of the speakers, especially the Republican representatives, to include the reduction of “tax expenditures” in the solution to the country’s long-term budget woes. Even Chairman Ryan, whose long-term budget blueprint focused solely on spending reductions, said he was willing to look at “tax expenditures.”1 Mitch Daniels, the Republican Governor of Indiana, said that he was in favor of reducing “tax expenditures.” As the governor of a state, Daniels will play no direct role in the long-term budget negotiations in Washington. However, as an influential member of the Republican Party, his views have weight.
Reducing “tax expenditures” was given force by the Bowles-Simpson Commission that proposed the reduction of marginal tax rates in exchange for a broadening of the tax base via the reduction of “tax expenditures.” In theory, the reduction of marginal tax rates should help boost long-term economic growth, an idea that appeals to many Republicans. Moreover, simplifying the tax code by eliminating numerous deductions and credits should reduce distortions in the economy. Republicans could sell a compromise that involves the reduction in marginal tax rates in exchange for a broadening of the tax base via the reduction of many “tax expenditures” as a pro-growth economic strategy that should be especially appealing to small businesses, a core constituency of the Republican Party.
But what’s in it for Democrats? The Republican speakers kept insisting that they want to preserve the social safety net for those Americans who need it and reduce entitlement spending for those who don’t need it. A deal to preserve Social Security and Medicare for less fortunate Americans and means-test the programs for wealthier Americans may be able to pass muster with Democrats.
For me, the highlight of the conference was the discussion that involved members of the “Gang of Six.”2 The members kept stressing that "everything is on the table” in their discussions, although Senator Crapo (R-ID) noted that some things may eventually be taken off the table in order to get a bill that 60 Senators can support. Notably, each of the members said that the reduction of “tax expenditures” was an important component of the solution. Senator Warner (D-NY) stated that the budget could not be balanced simply by targeting a few groups and that everybody had to have “some skin in the game.” Reflecting the sentiments expressed by former President Clinton during the morning session, Warner said that Americans would support significant fiscal consolidation if they felt that everybody “had some skin in the game.” Senator Chambliss (R-GA) echoed Warner when he claimed that there must be shared sacrifice.
The members of the “Gang of Six.” said that they are making progress in their search for a solution, but they would not give a specific timetable for when an agreement could be expected. They said they have drawn strength from other senators who have been encouraging them to keep working. In a capital city that appears to be rife with partisan division, it was heartening to see a group of politicians, who clearly enjoy each other’s company, trying to find a bipartisan solution to a very complex problem. At the conclusion of the panel discussion, the audience jumped to its feet to give this group of senators a standing ovation. Perhaps there really is a “hunger” among Americans for a solution to the long-term budget issues facing the U.S. government.
I do not mean to belittle the political challenges involved in crafting a solution to the nation’s long-run budget issues. Finding a solution in the Senate, which tends to be the more centrist and cordial chamber, may be relatively easy compared to the House, where the country’s political passions are more hotly on display. A solution that can satisfy 60 senators may not be able to command a majority in the House or be guaranteed of presidential support. The adage that “the devil is in the details” certainly applies in this situation.
However, I came away from the summit mildly encouraged. The media is filled with stories of partisan wrangling in Washington, and clearly politics have become much more divisive over the past few years. That said, I observed at the conference serious people who appear to be making a good faith effort to find common cause with people from the other side of the aisle. A long-term budget agreement may very well elude these leaders. However, for the first time in recent memory I am hopeful enough to think that the glass may actually be half full rather than half empty.
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