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President Obama also appointed a White House commission to create a sweeping, bipartisan plan to rein in the federal debt. Well, that commission wraps up its work this week. Members may or may not reach a consensus on the way forward, but this much is clear: The fiscal mistakes of America's past have come back to haunt us.
So in preparation for the commission's report, NPR's Scott Horsley borrows a familiar page from Charles Dickens.
(Soundbite of film, "A Christmas Carol")
(Soundbite of bells)
Unidentified Man (Actor): (as Scrooge) Horrible nightmare.
SCOTT HORSLEY: You remember "A Christmas Carol," where an old man wakes up with a whole new view of the world. That's what the authors hope the country will do after they issue their report on the debt later this week.
Most of the time, the only people losing sleep over the federal debt are government accountants and professional scolds. But this year, the specter of red ink seems to have a lot more ordinary Americans tossing and turning.
We heard about it on Election Day from folks like Bernie Marony, Didi Wojtal and Pat Henry.
Mr. BERNIE MARONY: I think it's a national problem. I think it needs to be solved. And I think we have to learn to live within our means.
Ms. DIDI WOJTAL: I am extremely worried about government spending. We need to balance our checkbook like the American taxpayers do.
Mr. PAT HENRY: Whenever you spend more than you have, it just doesn't work. You can't do it on the personal end. You can't do it on a personal financial end. And we're printing money at an alarming rate.
HORSLEY: President Obama insists he's ready to tackle this tough issue. So when Congress balked at creating a commission to help cut the debt, Mr. Obama appointed one of his own.
The 10 Democrats and eight Republicans who make up the commission have been studying the problem for months: reviewing the tax code, discretionary spending and entitlement programs like Social Security. The co-chairs, former Senator Alan Simpson and President Clinton's former Chief of Staff Erskine Bowles, have already gone public with a draft solution.
As Bowles told a breakfast organized by the Christian Science Monitor, lawmakers can either deal with the rising debt or have a fix thrust upon them by those who've been lending us money.
Mr. ERSKINE BOWLES (Co-chair, National Commission on Fiscal Responsibility and Reform): The problem we face is real. The solutions are all tough. And what Alan and I decided was everything had to be on the table.
HORSLEY: The Simpson-Bowles plan includes significant spending cuts and new tax revenues. Predictably, Simpson says, it drew immediate protests from both the left and the right.
Mr. ALAN SIMPSON (Co-chair, National Commission on Fiscal Responsibility and Reform): We have irritated hopefully everyone in the United States and especially every group. The groups have organized against us and will come like harpies off the cliffs with their taloned hands and fingers out. You can be savaged from the right and the left, which is good, good place.
A week after Simpson and Bowles published their plan, a second bipartisan group issued their recommendations for cutting the debt. While there are important differences, both maps lead in the same direction.
For example, both would increase tax revenues not by raising rates but by cutting out deductions. Income tax rates would actually come down. Both plans would curtail Social Security benefits for future retirees while increasing payments to the neediest seniors.
In other words, both plans involve compromise. And chief economist Diane Lim Rogers of the fiscal watchdog Concord Coalition says both are reasonable.
Ms. DIANE LIM ROGERS (Chief Economist, Concord Coalition): As soon as we can get the conservatives to realize that in these proposals are pro-growth tax reform proposals and the liberals to realize that in these proposals are Social Security reforms that actually strengthen the safety net, as soon as they can realize that, we'll be getting somewhere.
HORSLEY: Even talking about raising tax revenues or cutting spending is difficult while the country is still trying to dig out from recession. But Rogers notes that none of the proposals would take effect before 2012 at the earliest.
Ms. ROGERS: I think it's possible to start talking about or remind policymakers about the need for fiscal responsibility even in a time when you're running big budget deficits.
HORSLEY: President Obama has avoided commenting on either plan until his own commission has a chance to finish its work. But he told a gathering of business leaders in Japan this month he's not willing to cut government spending in areas he sees as growth engines, areas such as education or clean energy.
President BARACK OBAMA: We will make sacrifices. But everyone here should know that as long as I am president, we are not going to sacrifice America's future or our leadership in the world.
HORSLEY: Of course, unless the government gets control of its debt, it may not have the money or the borrowing capacity to make those investments in the future. But as Dickens told us, the future is not set in stone.
(Soundbite of film, "A Christmas Carol")
Unidentified Man (Actor): (As Scrooge) Men's courses will foreshadow certain ends. I accept it. But if those courses be departed from, the ends must change. Tell me that is so by what you show me.
(Soundbite of thunder)
HORSLEY: We'll have more on the choice we face about our future debt tomorrow on MORNING EDITION. Scott Horsley, NPR News, Washington.
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