Group pushes for sacrifices to rein in federal debt

Fix the Debt, spawned by Simpson-Bowles panel, kicks off in N.C.

cjarvis@newsobserver.comNovember 27, 2012 

Members with the Campaign to Fix the Debt, like former N.C. Governor Jim Hunt, gathered at the Raleigh Marriott City Center to address members of the media about the urgency of the fiscal cliff and the long term debt crisis.

COREY LOWENSTEIN — clowenst@newsobserver.com

— If politicians can stop being political. If Americans can accept less government but at a higher cost. If everyone can just pull together, the country can conquer the federal debt.

That was the message that a handful of business and political figures delivered Tuesday at an event kicking off the national Fix the Debt campaign in North Carolina. Even as the come-together sermon was being delivered inside a Raleigh hotel, an assortment of special-interest groups outside were questioning their motives.

That conflict underlines just how difficult it will be to find a way out of the debt crisis and put the country on stable economic footing in the years to come.

Fix the Debt is a national effort born of the Simpson-Bowles commission’s recommendations two years ago calling for tax increases and spending cuts to deal with what is now a $16 trillion debt. Charlotte resident Erskine Bowles, former President Bill Clinton’s chief of staff, and Alan Simpson, a former U.S. senator from Wyoming, founded the campaign, which is under way in 16 other states.

The North Carolina chapter plans to organize events and buy advertising to put public pressure on elected federal officials to work toward a bipartisan compromise, even though it could mean painful cuts to popular federal expenditures, such as the military, Medicare, and subsidies to farmers and students.

Former Republican Gov. Jim Holshouser said solutions won’t be popular, and will include the federal government raising more revenue. He said he has seen several proposals for fixing the problem.

“I hate them all,” he said. “It comes down to the lesser of evils, in a sense.”

Criticism has followed Fix the Debt in other states, and it greeted the campaign in Raleigh. About a dozen protesters with signs stood outside the downtown hotel where event was held. They were from a state coalition that wants to end the Bush-era tax cuts for the wealthiest Americans, which are set to expire at the end of the year.

The AFL-CIO says the campaign is mainly interested in protecting corporate interests that have benefited from tax breaks. A delegation from the state chapter traveled to Washington on Tuesday to lobby the state delegation not to cut Medicare, Medicaid and Social Security.

And the N.C. Bioscience Industry issued a statement arguing against reductions in programs that help senior citizens and low-income people, such as Medicare Part D.

Those groups and others worry that since one of the stated goals of Fix the Debt is to lower tax rates, the deepest cuts will be made in social programs.

‘Do the big thing’

Former Democratic Gov. Jim Hunt addressed the conflict at the kickoff when he said that everyone will have to sacrifice.

“A lot of people in the various bases talk about how it’s going to affect me – just me,” Hunt said.

Hunt said he had to make unpopular cuts during his 16 years as governor, and portrayed the current crisis as on a scale with World War II, when the entire country had to rally together.

“What I think we must do is to go big, as someone described it,” Hunt said. “Do the big thing. We can’t just temporize on this thing, little bitty steps. We’ve got to take the big step now. We’ve got to bring the country back, like we did when we won the war.”

Hunt called on North Carolinians to urge their federal representatives to work together.

Leading Tuesday’s kickoff news conference was retired GlaxoSmithKline chief executive officer Bob Ingram. He is co-chairing the chapter with Hugh McColl, the retired Bank of America CEO.

Ingram said Fix the Debt hasn’t endorsed any specific solutions, but the Bowles-Simpson plan provides a framework of possibilities. The group has a list of core principles that call for protecting society’s most vulnerable while coming up with a long-term plan.

While reining in Medicare and Medicaid costs, the organization also proposes to ensure that Social Security stays solvent. It also favors “pro-growth tax reform” that raises revenue by broadening the tax base and lowering tax rates in order to raise revenue.

Ingram said it will take cuts and revenue to accomplish, but he didn’t say that meant tax increases. “All the nonpartisan economic studies that I’ve seen say broadening the base raises more revenues,” he said.

A Romney rerun?

Gerrick Brenner of the liberal group Progress N.C. said the speeches didn’t reassure him.

“Everyone wants to ‘fix the debt,’ ” he said, “but the real question is, ‘Who will pay?’ … This sounds like a rewind of the Mitt Romney for President campaign. Shared sacrifice includes not just entitlement reforms, but also higher tax rates for those who benefited most from the Bush tax cuts.”

Others who spoke at Tuesday’s event were Durham Mayor Bill Bell and Tonya Cockman, a small-business owner in Greensboro.

Besides the long-range goal of reducing the debt, politicians are grappling with a more pressing deadline: If a compromise isn’t reached by the end of the year, certain automatic spending cuts and tax increases will go into effect. Those will affect the payroll tax break, the Bush-era tax cuts and more than $100 billion a year in defense spending.

Jarvis: 919-829-4576

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