The Debt Is Too Damn High – Time to Establish a National Bi-partisan Fiscal Commission
The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Stephen R. Rolandi
November 27, 2023
“I am not among those who fear the people. They, and not the rich, are our dependence for continued freedom. And, to preserve their independence, we must not let our rulers load us with perpetual debt.” – Thomas Jefferson, 1816
Our third president’s warnings about the dangers of prolonged, massive national debt are increasingly more true today than when he first penned those words over 200 years ago.
As I write this column, the nation’s total sovereign debt stands at nearly $33.8 trillion, which works out to approximately $100,000 per American, and nearly $260,000 per tax payer.
When one compares the current United States Gross Domestic Product (GDP) of approximately $27.2 trillion to our current national debt, the ratio works out to 124 percent—lower than such nations as: Greece, Japan, Italy, Venezuela and Portugal; but significantly higher than current ratios for: France, Belgium, Germany, UK, Finland, Jamaica and Romania (it should be noted that the Debt-to-GDP ratio is a good metric to measure the stability and health of a nation’s economy).
In addition, when one looks at the amount of budget funds allocated/paid out each year to service the nation’s national debt, an estimated $663 billion was paid out for the fiscal year that ended on September 30, 2023; it is currently projected by the CBO and other organizations that this amount will rise to an estimated $745 billion next year and exceed $1 trillion annually in the next decade.
When one also considers projected deficits by 2035 for Social Security and Medicare—which would have a negative impact on the future financial viability of these long-established programs—this problem has now hit crisis proportions, unless it is resolved over the next few years ago.
This crisis may become a sleeper issue in next year’s Presidential and Congressional elections. The subject of our increasing national debt is a topic of continuing interest to me (please refer to several of my previous PA Times articles).
However, there may be a positive development on the horizon—earlier this month, Senators Mitt Romney (R-Utah) and Joe Manchin (D-W.VA.) introduced legislation to create a statutory, bi-partisan national fiscal commission tasked with developing proposals to lower the national debt. Entitled the “Fiscal Stability Act of 2023,” the proposed legislation has the following Senate co-sponsors: Senator John Cornyn (R-TX.); John Hickenlooper (D-CO.); Cynthia Loomis (R-WY.); Jeanne Shaheen (D-NH); Kristen Sinema (I-AZ); Thom Tillis (R-NC); Mark Warner (D-VA.); and Todd Young (R-IN).
This proposed legislation is the companion proposal advanced in the U.S. House of Representatives earlier this year, “The Fiscal Commission Act of 2023,”introduced by Representatives Bill Huizenga (R-MI) and Scott Peters (D-CA). This bill has 13 co-sponsors. That proposed legislation is identical in many respects to the Romney-Manchin bill.
Here are some highlights of the Romney-Manchin Senate bill:
- Legislation would establish a 16-member bipartisan, bicameral commission consisting of 12 elected officials and 4 outside experts;
- The Commission would produce a report and propose legislation aiming to improve the long-term fiscal condition of the Federal government, stabilize the ratio of public debt to GDP within a 15 year period; and improve solvency of Federal trust funds over a 75 year period;
- This Commission would be required to vote on approval of the final report and appropriate legislative language by May 1, 2025;
- Any report or legislative language produced by the Commission must be approved by a majority of the 12 elected official members, with at least three members being from each political party;
- If the Commission approves proposed legislative language, it would receive expedited consideration in both chambers of Congress;
- While 60 votes would be required to invoke cloture prior to final passage in the Senate, only a simple majority would be needed for the motion to proceed, which would be privileged.
It should be noted that the Senate legislation is patterned after the financial plan proposed in 2010 by the National Commission on Fiscal Responsibility and Reform (often referred to as “Simpson-Bowles Plan” from the names of the Commission’s co-chairs former Senator Alan Simpson and Erskine Bowles). That Commission’s proposals called for a combination of spending cuts and certain tax increases, which were never implemented.
The Romney-Manchin bill is different from the Simpson-Bowles Plan in that there is a privileged legislative process that would ensure that this proposed bill would get to the floor of the Senate for an expedited vote.
Its chances for passage may be better than the 2010 Simpson-Bowles Plan given the current heavier debt burden (by comparison, the total national debt was approximately $14 trillion and GDP $15 trillion for a debt-GDP ratio of 93.3 percent), as well as renewed interest in the future viability of Social Security and Medicare.
In recent weeks, support for this bill has been expressed by such non-partisan groups as the Concord Coalition, Peter G. Peterson Foundation and the Committee for a Responsible Federal Budget. Public opinion may finally be coming around to the seriousness of this crisis; a recent poll released by the Democratic firm Global Strategy Group and Republican polling organization North Star Opinion indicated that voters are very concerned about rising interest costs consuming more of the Federal budget ($1.8 billion daily by one estimate).
Time will tell if elected officials will heed the voices of good government groups and the voters.
Author: Stephen R. Rolandi retired in 2015 after serving with the State and City of New York. He holds BA and MPA degrees from New York University, and studied law at Brooklyn Law School. He teaches public finance and management as an Adjunct Professor of Public Administration at John Jay College of Criminal Justice (CUNY) and Pace University. Professor Rolandi is a Trustee of NECoPA; President-emeritus of ASPA’s New York Metropolitan Chapter and past Senior National Council Representative. He has served on many association boards, and is a frequent guest commentator on public affairs and political issues affecting the nation and New York State. You can reach him at: [email protected] or [email protected] or 914.441.3399 or 212.237.8000.
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The Debt Is Too Damn High – Time to Establish a National Bi-partisan Fiscal Commission
The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Stephen R. Rolandi
November 27, 2023
“I am not among those who fear the people. They, and not the rich, are our dependence for continued freedom. And, to preserve their independence, we must not let our rulers load us with perpetual debt.” – Thomas Jefferson, 1816
Our third president’s warnings about the dangers of prolonged, massive national debt are increasingly more true today than when he first penned those words over 200 years ago.
As I write this column, the nation’s total sovereign debt stands at nearly $33.8 trillion, which works out to approximately $100,000 per American, and nearly $260,000 per tax payer.
When one compares the current United States Gross Domestic Product (GDP) of approximately $27.2 trillion to our current national debt, the ratio works out to 124 percent—lower than such nations as: Greece, Japan, Italy, Venezuela and Portugal; but significantly higher than current ratios for: France, Belgium, Germany, UK, Finland, Jamaica and Romania (it should be noted that the Debt-to-GDP ratio is a good metric to measure the stability and health of a nation’s economy).
In addition, when one looks at the amount of budget funds allocated/paid out each year to service the nation’s national debt, an estimated $663 billion was paid out for the fiscal year that ended on September 30, 2023; it is currently projected by the CBO and other organizations that this amount will rise to an estimated $745 billion next year and exceed $1 trillion annually in the next decade.
When one also considers projected deficits by 2035 for Social Security and Medicare—which would have a negative impact on the future financial viability of these long-established programs—this problem has now hit crisis proportions, unless it is resolved over the next few years ago.
This crisis may become a sleeper issue in next year’s Presidential and Congressional elections. The subject of our increasing national debt is a topic of continuing interest to me (please refer to several of my previous PA Times articles).
However, there may be a positive development on the horizon—earlier this month, Senators Mitt Romney (R-Utah) and Joe Manchin (D-W.VA.) introduced legislation to create a statutory, bi-partisan national fiscal commission tasked with developing proposals to lower the national debt. Entitled the “Fiscal Stability Act of 2023,” the proposed legislation has the following Senate co-sponsors: Senator John Cornyn (R-TX.); John Hickenlooper (D-CO.); Cynthia Loomis (R-WY.); Jeanne Shaheen (D-NH); Kristen Sinema (I-AZ); Thom Tillis (R-NC); Mark Warner (D-VA.); and Todd Young (R-IN).
This proposed legislation is the companion proposal advanced in the U.S. House of Representatives earlier this year, “The Fiscal Commission Act of 2023,”introduced by Representatives Bill Huizenga (R-MI) and Scott Peters (D-CA). This bill has 13 co-sponsors. That proposed legislation is identical in many respects to the Romney-Manchin bill.
Here are some highlights of the Romney-Manchin Senate bill:
It should be noted that the Senate legislation is patterned after the financial plan proposed in 2010 by the National Commission on Fiscal Responsibility and Reform (often referred to as “Simpson-Bowles Plan” from the names of the Commission’s co-chairs former Senator Alan Simpson and Erskine Bowles). That Commission’s proposals called for a combination of spending cuts and certain tax increases, which were never implemented.
The Romney-Manchin bill is different from the Simpson-Bowles Plan in that there is a privileged legislative process that would ensure that this proposed bill would get to the floor of the Senate for an expedited vote.
Its chances for passage may be better than the 2010 Simpson-Bowles Plan given the current heavier debt burden (by comparison, the total national debt was approximately $14 trillion and GDP $15 trillion for a debt-GDP ratio of 93.3 percent), as well as renewed interest in the future viability of Social Security and Medicare.
In recent weeks, support for this bill has been expressed by such non-partisan groups as the Concord Coalition, Peter G. Peterson Foundation and the Committee for a Responsible Federal Budget. Public opinion may finally be coming around to the seriousness of this crisis; a recent poll released by the Democratic firm Global Strategy Group and Republican polling organization North Star Opinion indicated that voters are very concerned about rising interest costs consuming more of the Federal budget ($1.8 billion daily by one estimate).
Time will tell if elected officials will heed the voices of good government groups and the voters.
Author: Stephen R. Rolandi retired in 2015 after serving with the State and City of New York. He holds BA and MPA degrees from New York University, and studied law at Brooklyn Law School. He teaches public finance and management as an Adjunct Professor of Public Administration at John Jay College of Criminal Justice (CUNY) and Pace University. Professor Rolandi is a Trustee of NECoPA; President-emeritus of ASPA’s New York Metropolitan Chapter and past Senior National Council Representative. He has served on many association boards, and is a frequent guest commentator on public affairs and political issues affecting the nation and New York State. You can reach him at: [email protected] or [email protected] or 914.441.3399 or 212.237.8000.
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