National debt panel urged to 'go big'

@CNNMoney September 12, 2011: 4:28 PM ET

NEW YORK (CNNMoney) -- When it comes to cutting deficits, don't play small ball.

That was the message Monday in a letter to Congress' national debt super committee from a group of more than 60 leading economists, budget experts, former Treasury secretaries and former lawmakers.

"We urge you to 'go big' and develop a large-scale debt reduction package sufficient to stabilize the debt as a share of the economy," the letter to the super committee said.

Easier said than done, of course, given the deep partisan divide over how best to reduce deficits. And it doesn't help that the super committee will have to work super fast -- with just 11 weeks to turn out a bill for consideration in the House and Senate.

Super committee: 'The world is watching'

Fiscal experts estimate that to stabilize the debt held by the public at today's level -- roughly 67% of GDP -- by the end of the decade, lawmakers would need to institute about $4 trillion worth of deficit reduction over 10 years.

If the committee only recommends $1.5 trillion in deficit reduction, the country's accumulated debt will still be on track to grow faster than the economy indefinitely.

Getting to $4 trillion is not really feasible unless lawmakers curb growth in entitlement program spending and reform the tax code.

Those are the only ways to address main drivers of the country's growing debt problem: unsustainable growth in health care costs, an aging population and an already wide and growing gap between spending and revenue.

"We believe that a go-big approach ... is necessary to bring the debt down to a manageable and sustainable level, improve the long-term fiscal balance, reassure markets and restore Americans' faith in the political system," the letter said.

Signing the letter were a number of former lawmakers from both sides of the aisle, including Republican Judd Gregg and Democrat Bob Kerrey, as well as a bipartisan bevy of former presidential economic advisers, including Christina Romer, Martin Feldstein and Glenn Hubbard.

The letter was also signed by former Treasury secretaries Robert Rubin and Paul O'Neill, as well as Erskine Bowles and Alan Simpson, who co-chaired President Obama's 2010 fiscal commission.

Several fiscal experts rounded out the group. Among them: William Gale of the Brookings Institution and Maya MacGuineas of the nonpartisan Committee for a Responsible Federal Budget, which organized the letter.

Next week, President Obama will send the super committee his proposal for how to reduce the debt over time, and he's promised it would be big enough to stabilize the debt in the long run.

If the 12-member bipartisan committee fails to produce a bill by Nov. 23 or agrees to less than $1.2 trillion in debt reduction, automatic spending cuts across much of the federal budget will be triggered starting in 2013. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
View rates in your area
Find personalized rates:
Economic Calendar
Latest ReportNext Update
Home pricesAug 28
Consumer confidenceAug 28
GDPAug 29
Manufacturing (ISM)Sept 4
JobsSept 7
Inflation (CPI)Sept 14
Retail sales Sept 14
  • -->

    Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.