We’re at a funny place. The American establishment has finally come around, in unison, to admitting that America is in crisis, that our debt actually threatens our ability to endure, that if we don’t make progress on this, we are going to near our endpoint as a nation. I am struck very recently by the number of leaders in American business, politics and journalism who now get a certain faraway look at the end of an evening or a meal and say, “It’s worse than people think, you know.” The debt crisis in Europe is not easing but worsening, the U.S. bond markets could bail tomorrow, the culture of Washington will kill any serious attempts at reform . . .
The American establishment, on both sides of the political divide, is admitting as never before that we are in an existential challenge. And this is progress. It was not always so! It wasn’t so two years ago.
That’s one takeaway from this week’s Peterson Foundation fiscal summit in Washington. Bill Clinton spoke of “permanent structural deficits” and warned that “arithmetic still matters.” We must focus on entitlement spending, he said, “for the same reason Willie Sutton robbed banks: That’s where the money is.” Virginia’s Democratic Sen. Mark Warner: “Congress is Thelma and Louise in that car headed for the cliff.” Obama administration economic adviser Gene Sperling—more on him in a minute—called for “serious discussion” of the specifics of a debt-reducing plan.
Republicans were on the same page. No one said, “We can grow our way out of this thing,” or “The negative effects of chronic debt are exaggerated, let’s look at the positive side.” They would have been laughed out of the room.
The people, of course, saw the crisis coming before most politicians did, and every elected official in Washington is now quick to preface interviews with, “The people were ahead of us on this.” They say this with an air of discovery, the little Sherlocks. The people were ahead of them. Public concern began to deepen in the polls after the introduction of the new spending bills that followed the crash of 2008. Voter concern was made vivid in the 2009 and 2010 elections, when centrists voted like old-style Republicans who worried about red ink.
Elected officials began to get the message. Now they’ve got it. Our spending and debt are—and it is interesting that this is the first great buzzword of the new decade—“unsustainable.”
But here’s how we’re in a funny place. The great question now is whether the people who alerted the establishment to the crisis will trust that establishment to deal with it. The people have been like Paul Revere riding through the night warning, “The bankruptcy is coming!” It’s unclear whether they’ll now trust the politicians to take the right action.
There are many reasons the public might resist Washington’s prescriptions, and we know what they are. There are data demonstrating that people like government programs but not government costs. Many people feel they’ve personally played by all the rules and will reject any specific cuts or taxes that will put new burdens on them.
There’s also this. The very politicians who are trying to get us out of the mess are the politicians who got us into the mess. Why would anyone trust them? As Alan Simpson admitted, for generations politicians “were told to go to Washington and bring home the bacon. Go get the money!” Now they must change: “You can’t bring home the bacon anymore, because the pig is dead.”
Some of the politicians talking about how to stop the spending crisis are the same politicians who, for many years, said there was no crisis. They’re like forest creatures who denied there was a fire when everyone else could smell the smoke and hear the crackle. Then the flames roar in, and the politicians say, “Follow me, I know the path out of the blaze!” It will be hard for them to win the trust that will get the American people to back a path out and through.
Rep. Paul Ryan was at the summit, soldiering on. His main problem on Medicare is that people fear the complexities and demands of a new delivery system.
People who draw up legislation, people capable of mastering the facts of the huge and complicated federal budget, often think other people are just like them. It’s almost sweet. But normal people don’t wear green eyeshades. Republicans think people will say, when presented with new options for coverage, “Oh good, another way to express my freedom! I can study health insurance now and get a policy that will benefit not only me but our long-term solvency!” But normal people are more likely to sit slouched at the kitchen table with their head in their hands. “Oh no, another big decision, another headache, 50 calls to an insurance company, another go-round with the passive-aggressive phone answerer who, even though she’s never met me, calls me Freddy as she puts me on hold.”
Republicans believe government gives insufficient respect to the ability of people to decide things for themselves, and that’s true. But it’s also true that normal humans don’t relish making informed decisions about things they’re not sure of, and that carry big personal implications.
Here’s the great thing about Medicare: You turn 65 and it’s there. They give you a card and the nurse takes it.
Supporters of Mr. Ryan’s Medicare plan must talk very specifically about how this would all work, and why it would make your life better, not worse. They also have to make two things clearer. One is that if nothing is done to change Medicare, the system will collapse. You’ll give the card to the nurse and she’ll laugh: “We don’t take that anymore.” This already happens in doctors offices. Without reform it will happen more often.
Democrats, on the other hand, should be forced to answer a question. If you oppose the highly specific Ryan plan, fine, but tell us your specific proposal. How will you save Medicare? Will you let it die?
If Obama economic adviser Gene Sperling’s presentation at the summit was indicative of White House strategy, then we’re in trouble. Because that strategy comes down to windy and manipulative statements about how “we’re all in this together” but GOP proposals “will lead to millions of children . . . losing their coverage.” He added: “We are not criticizing their plan, we are explaining it.”
It is a long time since I’ve seen such transparent demagoguery, such determined dodging. It’s obvious the White House political plan for 2012 is this: The Democrats will call for fiscal discipline and offer no specifics or good-faith starting points. They will leave the Republicans to be specific, and then let them be hanged with their candor. Democrats will speak not of what they’ll do but only of what they would never do, such as throw grandma out in the snow. In honeyed tones, Mr. Sperling said both parties should “hold hands and jump together,” like Butch and Sundance. But it was clear Sundance was going to stop at the edge of the cliff and hope Butch gets broken on the rocks.