Commentary: Maya MacGuineas is the director of the fiscal policy program at the New America Foundation.
The draft plan released last week by the co-chairmen of President Obama's fiscal commission started an important conversation.
The plan would cut defense and domestic discretionary spending, end most tax breaks while lowering rates and reduce health care spending. It would make Social Security solvent by raising the retirement age, lowering benefits on the upper end and raising taxes. It would also increase the gas tax.
All are good ideas. Guess what? The critics are circling.
"It a travesty, outrageous, DOA." Or, "You must be kidding: We said, NO new taxes."
"You would do what? Raise the Social Security retirement age?"
Never mind that the retirement age would go up one year by 2050, and two years by 2075 with a hardship exemption for many workers.
The attacks on the plan are completely predictable -- and utterly frustrating.
Did people really think fixing the national debt problem would be easy? In fact, if the plan had been greeted with approving "ooohs" and "aaahs," that would have been a sure sign it was not up to the job.
I think the plan is not only an excellent starting point but an excellent ending point as well.
Make the budget plan part of a comprehensive economic recovery plan: One of the loudest criticisms of the plan is that it would send us back into a recession.
Au contraire -- putting a legitimate debt reduction plan in place and phasing it in gradually is one of the most important components of helping the recovery to stick.
But Bowles and Simpson should add immediate fiscal stimulus. For instance, they could call for Congress to give money to the struggling states in return for an overhaul of pension and health systems. Another idea: an immediate payroll tax cut in return for a gradual increase in the early retirement age.
Fix Social Security and improve retirement security: The plan would fix Social Security but does nothing to help our national savings problems.
Instead of raising payroll taxes for Social Security, which their plan would do over time, they should phase in some of the spending reductions more quickly. Their plan could use new revenues to build mandatory, add-on savings accounts that would sit on top of Social Security, providing all retirees with diversified benefits and helping to increase national saving. (Social Security - Take the quiz)
Tax better and tax fairly: The co-chair plan has great ideas for fundamental tax reform by broadening the base and lowering rates. But it doesn't go far enough to recognize the disturbing growth in income inequality.
In return for keeping government spending down and thus taxes under control, they should make the overall tax system more progressive.
Rather than aiming to bring the top income tax rate down to 24%, the plan should keep the top rates where they are and plow more savings into tax relief at the lower end and in the business sector to help consumers and the private sector drive the economic recovery.
Make it stick: Stronger reforms of the budget process should be part of a fiscal plan so it doesn't go off of the rails after the first year or two. Bowles and Simpson should include a specific target: Reduce the debt to a set level by a set date. If lawmakers miss, spending would be automatically cut and taxes raised.
They should also include spending caps and automatic triggers on the programs that most threaten the budget such as health care, Social Security and tax breaks.
Don't water it down: It will be tempting to make the plan more agreeable by doing less. Don't take the deal.
The Bowles-Simpson plan will not fix all the nation's fiscal problems. For instance, it doesn't balance the budget until 2037. But it will go a long way, and reassure credit markets in so doing.
Watering down the plan might not calm markets for long. No sense going through all this pain just to have to do it again in a few more years.
Now is the time: Maybe both sides think they can do better than this deal so they'd rather wait it out.
But if conservatives dig in their heels on not raising taxes, we will likely hit a fiscal wall first and be forced by markets to make large changes abruptly. That's a scenario to be avoided: The only option then would be a large add-on value added tax, which will undoubtedly turn into a dreaded money machine as rates get pushed up year after year.
Rejecting relatively small tax increases now increases the probability of very large ones later.
On the left, the risk of waiting is that Congress will be forced to dramatically scale back the safety net for the neediest. Reducing benefits now for the more well off in Social Security, health care and other areas of the budget allows us to stick to the principle of protecting those who most depend on the programs.
Waiting makes that harder to do.
Congress and the president will have to come up with something both sides can agree on. There are certainly changes that could help make a budget plan more amenable to the left and the right. But the opening bid by Bowles and Simpson is an awfully good start. Let the negotiations begin.
Doug McMillon raked in $22.8 million. The median associate made $19,177. More
US regulators are close to slapping Wells Fargo with a $1 billion fine for forcing customers into car insurance and charging mortgage borrowers unfair fees. More
In 1998, Ntsiki Biyela won a scholarship to study wine making. Now she's about to launch her own brand. More
Countless older workers are about to end their careers without money in the bank. Here's what to do if you're one of them. More