Will Marshall
2008-05-07 07:00:00.0
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WASHINGTON -

The U.S. Treasury recently reported that the federal deficit will hit a record high of $311 billion for the first half of the fiscal year, thanks in part to plunging corporate profits and revenues. The report was greeted with stifled yawns by official Washington.

Similar indifference greeted the Social Security and Medicare trustees when they issued their annual spring warning about an even bigger fiscal time bomb: exploding entitlement costs ... but this year’s warning is more serious than ever: In 2008, the oldest of 77 million baby boomers will reach the age of eligibility for Medicare and Social Security. It is the beginning of an unprecedented demographic surge that threatens to overwhelm the nation’s finances if we don’t act, and soon.

To this end, members of the Brookings-Heritage Fiscal Seminar, a nonpartisan group of 16 federal budget and policy experts of which I am a member, have hammered out an innovative plan for averting a fiscal meltdown. The basic idea is simple: Take entitlement spending off autopilot and establish a fixed, overall budget for the programs.

Political leaders, we say, can no longer afford to let the big entitlement programs grow automatically each year, with no deliberation by Congress, no pressure to reconcile spending and revenues, and no attempts to make trade offs among competing public priorities.

Read more at www.ppionline.org.