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How to End the Budget Deficit
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# : |
15844 |
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Section : |
CURRENT ISSUES
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| Issue
Date : |
1 / 1989 |
3,780 Words |
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Thomas E. Mann and Charles L. Schultze
Thomas E. Mann is director of the Brookings Governmental
Studies program. Charles L. Schultze is director of the
Brookings Economic Studies program. |
The new president faces a formidable political challenge. While some economists and financial leaders have for years been warning that large budget deficits would lead to catastrophe, none has occurred, and the public is growing immune to scare talk. Although far from guaranteed, the United States may be able to continue with large budget deficits and national overspending for another presidential term. The costs of failing to deal with the budget deficit are no less real for all of that.
But, they are gradual in nature, involving an almost imperceptible slowing year by year in the growth of American living standards. Like the fat person who needs to go on a diet but who feels that one more high-calorie meal won't hurt, Americans may rightly feel that one more year of high deficits will not itself cause grave damages. But continue the overeating, and the overspending, and long-term damage mounts up.
Unfortunately, the American political system is not well suited to address this challenge. While no democratic government can easily impose immediate sacrifices on its populace for the sake of future gains, the division of authority and responsibility between the president and Congress makes that task especially formidable in this case. In times of crisis, the government can move with breathtaking speed to change national policy; it can be equally responsive in the face of an insistent, unified citizenry demanding action from its elected officials. But political and institutional forces make it almost impossible for government to embrace austerity measures over the opposition of the public and with no promise of immediate gain or avoidance of
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