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UNH Law conference explores difficulty, necessity of ‘grand bargain’ on federal deficit

  • Former Nebraska senator Bob Kerrey (center) shakes hands with former New Mexico senator Pete Domenici (left) as NPR White House correspondent Ari Shapiro looks on. Senators past and present attended the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013. <br/>(ALEXANDER COHN / Monitor staff)

    Former Nebraska senator Bob Kerrey (center) shakes hands with former New Mexico senator Pete Domenici (left) as NPR White House correspondent Ari Shapiro looks on. Senators past and present attended the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • Panelists from left: Former Nebraska senator Bob Kerrey, former White House Office of Management and Budget director Alice Rivlin, former Texas senator Phil Gramm, New Hampshire Sen. Kelly Ayotte and National Public Radio White House correspondent Ari Shapiro laugh as Arizona Sen. John McCain (center) tells a story about Sen. John Simpson of Wyoming during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

    Panelists from left: Former Nebraska senator Bob Kerrey, former White House Office of Management and Budget director Alice Rivlin, former Texas senator Phil Gramm, New Hampshire Sen. Kelly Ayotte and National Public Radio White House correspondent Ari Shapiro laugh as Arizona Sen. John McCain (center) tells a story about Sen. John Simpson of Wyoming during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • Former U.S. comptroller general David Walker delivers the keynote speech at the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

    Former U.S. comptroller general David Walker delivers the keynote speech at the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • NPR White House correspondent Ari Shapiro (right) asks New Hampshire Sen. Kelly Ayotte a question during a panel on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

    NPR White House correspondent Ari Shapiro (right) asks New Hampshire Sen. Kelly Ayotte a question during a panel on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • Former Texas senator Phil Gramm listens to a discussion on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

    Former Texas senator Phil Gramm listens to a discussion on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • Arizona Sen. John McCain (center) listens to New Hampshire Sen. Kelly Ayotte speak during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

    Arizona Sen. John McCain (center) listens to New Hampshire Sen. Kelly Ayotte speak during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.
    (ALEXANDER COHN / Monitor staff) Purchase photo reprints at PhotoExtra »

  • Former Nebraska senator Bob Kerrey (center) shakes hands with former New Mexico senator Pete Domenici (left) as NPR White House correspondent Ari Shapiro looks on. Senators past and present attended the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013. <br/>(ALEXANDER COHN / Monitor staff)
  • Panelists from left: Former Nebraska senator Bob Kerrey, former White House Office of Management and Budget director Alice Rivlin, former Texas senator Phil Gramm, New Hampshire Sen. Kelly Ayotte and National Public Radio White House correspondent Ari Shapiro laugh as Arizona Sen. John McCain (center) tells a story about Sen. John Simpson of Wyoming during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)
  • Former U.S. comptroller general David Walker delivers the keynote speech at the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)
  • NPR White House correspondent Ari Shapiro (right) asks New Hampshire Sen. Kelly Ayotte a question during a panel on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)
  • Former Texas senator Phil Gramm listens to a discussion on current political challenges during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)
  • Arizona Sen. John McCain (center) listens to New Hampshire Sen. Kelly Ayotte speak during the inaugural Rudman Center Conference at the UNH School of Law in Concord; Monday, April 22, 2013.<br/>(ALEXANDER COHN / Monitor staff)

President Obama and congressional leaders can address the federal government’s massive budget deficit by hammering out a “grand bargain” on spending, taxes and entitlement programs like Social Security and Medicare. There’s real doubt such a deal is politically feasible – but if it’s going to happen, it’ll have to happen soon, perhaps this summer or fall.

Those were some of the takeaways yesterday as a high-powered collection of current and former federal officials gathered at the University of New Hampshire School of Law for a conference in honor of the late Warren Rudman, the New Hampshire Republican and two-term U.S. senator who made fighting the federal deficit one of his signature issues.

“The Federal Budget and the Law: Finding a Way Forward” was the inaugural event for the Concord law school’s new Warren B. Rudman Center for Justice, Leadership and Public Policy. Rudman died last November at the age of 82.

“The biggest deficit this country has is a leadership deficit, and it’s bigger with Warren Rudman’s passing,” said David Walker, the former U.S. comptroller general.

Walker opened yesterday’s conference by painting a bleak picture of the nation’s finances gone astray.

“We’re spending more and more on consumption, less and less on investment, more and more on seniors, less and less on young people, more and more on things that aren’t expressed and enumerated in the Constitution, less and less on things that are. That is not a prescription for prosperity,” Walker said. “We must change course. Government has grown too big, promised too much and needs to restructure, at all levels of government in many cases.”

The goal for lawmakers, Walker said, shouldn’t be a balanced federal budget or paying off the national debt, but to bring a key measure, the ratio of public debt to the nation’s gross domestic product, down to a sustainable level. The ratio stood at 72.5 percent in 2012, according to the Congressional Budget Office, the highest level since the years after World War II, when the ratio soared above 120 percent.

Taming the deficit – which tallied $1.1 trillion in fiscal 2012, pushing the national debt over the $16 trillion mark – isn’t easy.

In 2011, Obama and Congress agreed to enact a system of automatic budget cuts known as sequestration, as a way to provide lawmakers with an incentive to come up with a more elegant solution. They failed, and the sequestration cuts to domestic and military spending went into effect this year.

But officials say much more must be done to bring the deficit under control. A panel of experts yesterday said there’s agreement among bipartisan groups that any effective package to reduce the deficit over the long term would include comprehensive reform of the tax code, measures to control spiraling health care costs and reductions in retiree benefits such as Social Security and Medicare.

Those are complicated and difficult decisions, said Bill Hoagland, senior vice president of the Bipartisan Policy Center and former staff director for the Senate Budget Committee.

“Once you get beyond, ‘Let’s make a deal,’ . . . it’s what goes into the deal that becomes extremely complicated,” Hoagland said. “Health care reform is a prime example. We all have the same goal: lower the rate of growth in health care. But when you get into the actual structural changes you have to make, this is very complicated.”

Those decisions are politically fraught, too, said former Nebraska senator Bob Kerrey, a Democrat who spoke as part of a separate panel yesterday. Democrats will be hit from the left if they reduce entitlement benefits, he said, and Republicans will be hit from the right if they raise taxes.

“There’s significant numbers of people who campaign and promise never to vote for a tax increase. And it may be that they’re few and far between on bipartisan commissions, but they’re not few and far between out there in the country. ‘I will not vote for anybody that votes for a tax increase,’ and the person promises never to vote for a tax increase. In other districts, ‘I will never vote for somebody who votes to cut Social Security,’ and the person makes a promise never to vote to cut Social Security or charge Medicare Part B beneficiaries any more. They make their promise, and my guess is, it’s pretty close to a majority in the House that have made that kind of a promise,” Kerrey said. “So, I’m generally skeptical that democracy can solve long-term problems.”

But former Texas senator Phil Gramm of Texas, who partnered with Rudman on deficit-reduction legislation in the mid-1980s, said politicians are willing to cast a tough vote under the right circumstances.

“I think we’re in one of these situations where a little half-baked deal can’t pass. But a dramatic action, where you can say to a member of Congress, ‘If you vote for this, you’re not going to have to vote on this issue again for the rest of your career,’ I think you could do it,” Gramm said. “People will cast a tough vote if they think they’re changing America.”

Sen. John McCain, an Arizona Republican, and others said it can be done – assuming, they said, Obama can commit to negotiating a real compromise with Republicans who control the U.S. House and have enough votes to block legislation in the Democratic-controlled U.S. Senate.

Increased revenue could be part of a deal, McCain said.

“Unless there is a real, ironclad, absolute commitment to reducing spending – and the only way you’re going to do that is by reforming the, quote, entitlement programs – then Republicans shouldn’t go along,” McCain said. “But are we absolutely taking it off the table? No.”

The time may be ripe. The next election isn’t until next year, and the federal government is expected to hit its borrowing limit this summer, requiring a vote by Congress to raise the debt ceiling. A standoff over the debt ceiling two years ago, with a potential government default in the balance, led to the sequestration deal.

This year, the debt ceiling could be the trigger for a long-term deal on the deficit, said U.S. Sen. Kelly Ayotte, a New Hampshire Republican.

“I think this window is now, in the next few months,” Ayotte said.

If they fail, the consequences could be political as well as fiscal and economic. McCain said after his panel that frustration with Democrats and Republicans could eventually lead to the emergence of a new political movement, though he noted any third party faces significant obstacles.

“I’m not sure that people will be voted out of office, but I think what you could see, over a long period of time, maybe is the rise of an independent party in this country because people are so dissatisfied,” McCain said.

(Ben Leubsdorf can be reached at 369-3307 or
bleubsdorf@cmonitor.com or on Twitter @BenLeubsdorf.)

Legacy Comments3

Stop. For the love of G-d STOP! Hasn't anybody noticed that the Harvard economists whose research paper is the foundation document for all this austerity (cut spending) talk is a fraud. Reinhart and Rogoff admitted that errors were made after a University of Mass grad student found that their results could not be duplicated. Errors, my arse! They fudged their figures which when I was in graduate school was grounds for having one's thesis rejected and being booted out of the program. I guess there's a double standard for tenured profs who are making a particular point.

too bad the World Bank and the European Union and the G20 all released economic treatises recently that say you are wrong - but what they heck .........who are they

In reference to the out of control healthcare costs, here is an interesting video http://www.youtube.com/watch_popup?v=r13uYs7jglg showing how the cost of some expensive testing can be drastically cut.

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