OUR NATIONAL argument about who our next president will be ends tomorrow. Then the argument about future spending, taxing, and borrowing policies can be joined in earnest.
On one side are the deficit hawks. They are alarmed by the national debt, which mounts with each year of budget deficits. They worry over our low, even negative, national savings rate. They are concerned about America's trade deficit, which means we are paying more to other countries for their goods and services than they are paying for ours. Their core message is that we cannot go on consuming more than we produce, spending more than we take in, and borrowing to make up the difference.
It seems to me they have a point.
On the other side are the new-priorities advocates. They say the government should raise more revenue by closing loopholes and letting current temporary tax cuts expire. They point to a peace dividend once the Iraq war winds down. They believe we can save billions in the Medicare and Medicaid budget by reforming the healthcare system. Moreover, they are going to need all that revenue and savings to fund their new priorities, such as healthcare for nearly 50 million uninsured Americans, investments in worker training and new clean energy technologies, and rebuilding the nation's crumbling roads, bridges, and transit lines.
I think they have a point too.
For most of the last three decades, America has tried to have it both ways. A nation born amid cries of "no taxation without representation" has evolved to where taxation itself is suspect, but borrowing to fund current consumption is business as usual. President Bush missed the opportunity to call on Americans to sacrifice in the wake of the 9/11 attacks. But it may say as much about us as it does about him that he urged us to go shopping instead.
As Des Moines Register reporter David Yepsen put it in the recent deficit hawk documentary "I.O.U.S.A.": "This is America. We don't do anything until something reaches a crisis, whether it's military rearmament before World War II or this question now. We're not going to be willing to [sacrifice] until it gets to be a real problem."
Well, it's getting to be a real problem. One year's interest on our national debt is now more than the federal government spends on education, housing, homeland security, environment, agriculture, transportation, and veterans programs combined. If we go deeper into debt, the interest payments will rise, creating even more downward pressure on other spending.
Yet for all of America's borrowing and spending, there remain critical unmet needs. Most economists believe we are entering a recession, and Congress is likely to enact a new economic stimulus package. And don't forget the baby boomers - like me - who are beginning to retire and develop expensive medical conditions.
The situation, though serious, is not yet dire. America is still a wealthy, innovative, dynamic, and resourceful country. But finding a sustainable path forward will require America to put some difficult questions on the table:
Is a country that ranks 27th in total tax burden among the 30 Organization for Economic Cooperation and Development countries - that's us - really overtaxed?
What kind of defense does a post-Cold War America really need? Are there military bases and weapons systems that once made sense but no longer do?
Might we not learn some lessons from countries that provide healthcare of comparable quality to ours but at far lower cost?
How can we accelerate the transition away from fossil fuels in ways that create jobs, stabilize the climate, and reduce our expensive and dangerous military involvements in oil-producing regions of the world?
Could we perhaps plan to retire a bit later, relieving pressure on Social Security and tapping the productivity and experience of older workers?
Trends that cannot continue indefinitely won't. Our current spending, taxing, or borrowing - probably all three - will need to change. The new president and Congress will need to balance the concerns of both the deficit hawks and the new-priorities advocates. Perhaps more important, they will have to explain the choices we face to the American people.
Jim Gomes, a guest columnist, is the director of the Mosakowski Institute for Public Enterprise at Clark University.