Fiscal cliff dangers
Congress and newly re-elected President Barack Obama must place a priority on finding common ground to avoid the “fiscal cliff,” the Republican U.S. senator from Ohio says, and just as important is to build the framework for the future to deal with the nation’s underlying budget problems.
His Democratic counter-part agrees with Portman that this is the time Congress needs to find common ground to develop a budget in an effort to deal with United States’ fiscal crisis and to stimulate the economy.
“I actually view this as an opportunity for us to face up to some of the issues that Congress must address including entitlement reform and tax reform and if we fail to address those issues then we will have another fiscal cliff coming up very shortly and that will in the form of a debt limit,” U.S. Sen. Rob Portman said Thursday during a media teleconference. “This will place additional pressure on our economy because of our fiscal problems.”
Getting the U.S. government’s fiscal house in order is paramount especially with news the European Union, one of the United States largest trading partners, has slipped back into a recession. Another blow to the U.S. economy, Portman noted, was jobless claims climbed in October in the wake of Superstorm Sandy taking its toll on the East Coast.
With the fiscal cliff looming where U.S. debt exceeds the gross national product could result and another lowering of the nation’s credit rating, Portman hammered the idea that it is time to build a framework for the future by addressing entitlement reform, tax reform and regulatory reform as part of adopting legislation and policies to spur the economy. He said he also is open to making cuts in defense spending.
“On the defense authorization bill, there are a number of other issues that I will be working on and this is a must-do bill that will come to the floor,” Portman said. “One is we have to have the bill because it is imperative to keep a strong national defense when there are a lot of dangers around the world. We also have to do it in a smart way given the $16 trillion debt and make sure every dollar is spent wisely.”
As a member of the Veteran Services Committee, he said he will stress the importance of the continued manufacturing of two military planes in Ohio and he noted it is critical to maintain the manufacturing of tanks at the Joint Systems Manufacturing Center in Lima.
He also is a co-sponsor on the energy efficiency bill to help the nation conserve energy and to help the United States be less reliant on foreign oil.
Portman said the key is to re-examine and redevelop the framework of the nation’s programming from entitlement to taxes, from defense to energy, but the next step is critical and that is Republicans and Democrats, Congress and the president work together.
“I am hopeful that the bigger issue of the fiscal cliff can be dealt with in the context of dealing with these underlying problems that have been allowed to go unaddressed for far too long,” Portman said. “I am concerned about the economy. I don’t think we have seen the robust economic growth that we would normally see during a recovery, and I don’t think we will until we provide a better environment for job growth and opportunity.
“The president yesterday (Wednesday) talked about this issue, I was discouraged with what he said about entitlement reform and the fact he seemed to be unwilling to engage in dealing with the unsustainable growth of our entitlement programs — as important as they are we must address that,” the senator from Ohio said. “I was encouraged about what he said about tax reform and he was willing to listen to ideas, pro-growth tax reform that will grow the base and I think that is one of the way to give our economy a shot in the arm and a way to deal with the fiscal cliff issues as they relate to the huge tax increases that are pending.”
Portman avoided directly answering if taxes should be raised on the rich, but he said tax revenue could be increased by reforming the tax code. He could not support continuing the current system with tax increases.
“In the context of real entitlement reform which must happen in order for these programs to be sustainable and in the context of pro-growth tax reform that actually creates more jobs and more economic growth, I think there could be additional revenues,” Portman said. “I think it could come from folks who are at the upper end of the income scale. If it’s done on top of our current antiquated, inefficient tax code and if there’s no spending reductions as part of it which is being proposed by some on the Democratic side, I think the issue is a mistake. I couldn’t support that.”
Democratic U.S. Sen. Sherrod Brown offered the fiscal olive branch, by noting more and more members of Congress are willing to look at all areas for cuts, but he included increasing revenue by raising taxes on the rich.
“We need to start with revenues and we need to make balanced cuts,” Brown said. “I think nobody will object if the cuts are balanced and we do have significant revenues and there is a jobs component — the jobs component is very important to this, too.
“You can’t only cut your way into a balanced budget, you have to grow your way there, too,” the senator said. “We need all three. We don’t want to see the economy take a downturn and that is, to me, what we must always stay focused on.”
He would like to start with revenue and then determine how much more needs to be cut from programming and as the economy picks up then additional cuts may not be as needed. He said one area —Social Security —is off limits.
“Touching Social Security, raising the retirement age of Social Security is absolutely non-negotiable to me,” Brown said. “It should not be part of the package because Social Security is not part of the budget problem.
“It’s not just bad policy, it borders on immoral to force people that are working in plants or working construction or working retail or waiting tables to work until they’re 70 years old before they can get a pension they paid into their entire work lives,” he said. “I think that’s immoral.”