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Key Questions to Ask the Candidates (About Fiscal Policy)

August 27th, 2012 . by economistmom

Just released by the Concord Coalition, this good reading material for the start of the back-to-back conventions.  The intro to the document explains:

With the federal budget running annual deficits in excess of one trillion dollars, and many official and unofficial sources warning that current fiscal policies are not sustainable, it is vital that voters in 2012 demand realistic solutions from the candidates.

The fiscal challenges ahead are not a simple matter of too much “pork” or too many tax “loopholes.”

Our nation is undergoing an unprecedented demographic transformation against the backdrop of rising health care costs and falling national savings. It is an ominous combination for our economic future.

The retirement of the baby boomers, which began  in 2008, is ushering in a permanent shift to an older population — and a permanent rise in the cost of programs such as Social Security, Medicare and Medicaid, which already comprise 42 percent of the federal budget.

There is no plan to pay for it all other than running up the national debt. Some say that our political system only responds to a crisis. If that turns out to be true, we’re in big trouble.

Current budget projections are dominated by two factors: demographics and health care costs.

The Trustees of the Social Security and Medicare trust funds project that the number of Americans aged 65 and older will increase by almost 80 percent by 2035. In contrast, the working age population will grow by only 12 percent. This alone will strain the economy and budgetary resources.

Demographic change, however, is only part of the problem. For the past 40 years health care spending has consistently grown faster than the economy. If the same growth rate continues over the next 40 years, Medicare and Medicaid will absorb nearly as much of our nation’s economy as the entire federal budget does today.

No one can say exactly when a crisis will hit, but by the time it does the economy would likely be burdened with a debilitating amount of debt — leaving painful benefit cuts and steep tax increases as the only options. Doing nothing now to avoid this would be an act of fiscal and generational irresponsibility.

Key Questions Voters Should Ask Candidates

The following questions provide a framework for ensuring that candidates address some of the toughest choices they will face concerning the federal budget if they are elected. Background information is given to provide context and to help with follow-up questions, which should be asked whenever a candidate’s answer appears incomplete.

Read on for the actual questions and background material, and be well prepared to decipher the candidates’ responses to implicit or explicit questions like these that may come up on the campaign trail and at the debates.  Who knows–maybe at least one of you out there will even have a chance to ask a candidate one of these questions directly!

One Response to “Key Questions to Ask the Candidates (About Fiscal Policy)”

  1. comment number 1 by: AMTbuff

    Doing nothing now to avoid this would be an act of fiscal and generational irresponsibility.
    Doing almost nothing while pretending that it’s a major step toward fiscal balance would be even worse than doing nothing. It would be malpractice, like sending a Stage 3 cancer patient home with pain killers rather than moving immediately to surgery and chemotherapy.

    Politicians are expert at doing almost nothing while pretending that it’s a major step. One party is proposing this kind of “plan” and the other party may work its way down to a similar palliative by Election Day.