Wall Street Journal
Americans are rightly outraged over our nation's fiscal situation. The course we're on will lead to public debt that will exceed the size of our entire economy, and a government that will eventually exist to do only two things: fund entitlement programs and make interest payments. Americans may be wondering whether the Greek financial crisis could happen here.
It will—unless we change course. There's a myth that our budget deficit mess sprang into existence at the presidential inauguration on Jan. 20, 2009. But in truth, more than 90% of the projected deficit we will face over the next decade is the result of President Bush's 2001 and 2003 tax cuts, the wars in Afghanistan and Iraq, the rescue of the financial sector he began in the last few months of his presidency, and lower revenues from the recession. And the greatest driver of our long-term deficit is rapidly growing entitlement and health-care spending.
Both parties must learn: What is politically easy is often fiscally deadly. It's easier to hide the costs of war than to put those costs in front of the public. It's easier to promise 95% of Americans that we won't consider raising their taxes than to have a frank conversation about the realities of our balance sheet.
Voters are demanding that Washington take fiscal responsibility seriously. Democrats agree. But the public has a responsibility, too: To understand that lower taxes and higher spending may be popular, but they are a dangerous combination that leads to exploding deficits.
Health-care costs, as I noted, are one of our main challenges. According to the Congressional Budget Office the health-care bill will put us on a path to bring down those costs, incorporating many of the best ideas from both Republicans and Democrats. But Congress will need to ensure that as the law is implemented, it achieves the goal of containing costs. Congress will also need to stand strong against pressure to change cost-cutting provisions. We saw an example of the pressure early in the health-care debate, when critics of the legislation wrongly and knowingly portrayed its Medicare savings as a cut in benefits.
On a host of other issues, President Barack Obama also showed his seriousness about fiscal restraint. His budget freezes nonsecurity discretionary spending and cuts our deficit by more than half by 2013, and more than $1.3 trillion over the next decade. He signed a bill to reform weapons acquisition and target cost overruns at the Pentagon. And he joined me and others in the successful push to return to the pay-as-you-go law that requires Congress to find a dollar of savings for every extra dollar it spends on entitlements or tax cuts, except for legislation responding to a legitimate emergency.
The next step is the president's bipartisan fiscal commission, which began meeting yesterday. Both parties must come to the table without preconditions, prepared to make a long-term compromise—our chance to end a pattern of partisan stalemate. Congress must act on the commission's proposals.
If the commission makes a proposal that focuses only on the spending or revenue side of the equation, it will likely fail to rein in deficits. Rather than the spending-cut-dominated plan of Rep. Paul Ryan (R., Wis.)—which, as brave a step as it was, made sweeping and harmful changes to Medicare—I prefer a balanced approach that shares the burdens fairly. What would the options look like? When it comes to entitlement spending, the commission could recognize that Americans are living longer and raise the retirement age over a period of years. It might also make Social Security and Medicare benefits more progressive.
On the other side of the equation, nobody likes raising revenue—but sometimes it's necessary. President Bill Clinton raised taxes and cut spending in 1993 to balance the budget, and it paved the way for historic prosperity. We could also learn from the bipartisan collaboration of President Ronald Reagan and House Speaker Tip O'Neill. In 1983, they agreed on a package of reforms to save Social Security, and in 1986, they made our tax code simpler and more efficient.
Recovering from years of borrowing is one of the hardest tasks a nation can face. History is full of great powers brought low by unsustainable debt. Avoiding that fate isn't just the commission's or Congress's work. It's incumbent on all of us to resist easy answers and look reality in the face. Fiscal issues have always been tests of national character, and I trust that we have the character to pass.
Mr. Hoyer, a Maryland Democrat, is majority leader of the U.S. House of Representatives.