The Era of Big Deficit Concerns Is Over

With spending down and only the hardest choices left, deficit reduction has lost steam.

Supporters of republican presidential candidate former Massachusetts Gov. Mitt Romney stand next to a national debt clock during a rally at Exeter High School on January 8, 2012 in Exeter, New Hampshire.
National Journal
Alex Seitz Wald
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Alex Seitz-Wald
Feb. 20, 2014, 4 p.m.

After a three-year ob­ses­sion with clos­ing Amer­ica’s gap­ing budget hole, Wash­ing­ton, it seems, has moved on.

Last month’s budget deal, which put a mo­ment­ary end to the cliffs and crises that have dom­in­ated fisc­al poli­cy­mak­ing since the tea party came to Con­gress, coupled with a rap­idly shrink­ing short-term de­fi­cit, has driv­en the na­tion’s budget im­bal­ances quickly and quietly from the agenda.

And no one un­der­stands this bet­ter than Maya MacGuineas, who runs Fix the Debt, the most vo­cal anti-de­fi­cit group in the cap­it­al. Re­cog­niz­ing the new real­ity, the cam­paign is re­du­cing its staff, slow­ing activ­it­ies, and re­struc­tur­ing it­self for a goal that it read­ily ad­mits is now some­where over the ho­ri­zon. One out­side ally de­scribed the group as go­ing in­to “hi­berna­tion mode.”

“We’re morph­ing in­to a sort of longer-term co­ali­tion and chan­ging our struc­ture to re­flect the fact that this is go­ing to be a long game,” MacGuineas told Na­tion­al Journ­al. “I hope that something can hap­pen after the midterms, but I think in all like­li­hood that it doesn’t hap­pen un­til after 2016.”

While it’s easy to miss the dis­ap­pear­ance of something, the change is glar­ing if you know where to look. You can see it on the House and Sen­ate floors where, last month, Re­pub­lic­ans uttered the word “debt” just 225 times, down from 3,188 men­tions in Ju­ly 2011, ac­cord­ing to the Sun­light Found­a­tion. You could see it in Pres­id­ent Obama’s latest State of the Uni­on ad­dress, which men­tioned budget de­fi­cits al­most two-thirds few­er times than his 2011 speech.

And you can see it in opin­ion polling. Among the 20 or so pub­lic-policy goals that Pew reg­u­larly asks voters to pri­or­it­ize, re­du­cing the de­fi­cit fell faster than any oth­er in the poll­ster’s latest sur­vey, drop­ping 9 points from Janu­ary 2013 to Janu­ary 2014. That put the is­sue in sixth place, down from third just a year ago.

It’s a big change from June 2012, when Pew Re­search Cen­ter Pres­id­ent Andy Ko­hut wrote, “In my years of polling, there has nev­er been an is­sue such as the de­fi­cit on which there has been such a con­sensus among the pub­lic about its im­port­ance.”

The Can Kicks Back, a spin-off from Fix the Debt aimed at or­gan­iz­ing mil­len­ni­als around the is­sue, is now in debt it­self and strug­gling to stay aloft. “Without fun­drais­ing mir­acles … I don’t know how we both sus­tain [an] or­gan­iz­a­tion and do mean­ing­ful things,” cofounder Nick Troi­ano wrote in an in­tern­al email ob­tained by Politico.

MacGuineas says that Fix the Debt still has plenty of money, but that it wants to pre­serve its re­sources for a polit­ic­al mo­ment more ripe for a “grand bar­gain” that would dra­mat­ic­ally re­duce long-term budget de­fi­cits. “People are happy to take a breath­er,” she said, not­ing that tack­ling the is­sue will re­quire dif­fi­cult choices.

So Fix the Debt is study­ing what oth­er polit­ic­al move­ments have done after their is­sues fell off the agenda, MacGuineas said. She’s hop­ing to learn les­sons about stay­ing rel­ev­ant while in the polit­ic­al wil­der­ness, maybe from the cli­mate-change move­ment, which kept its head above wa­ter even after the col­lapse of cap-and-trade le­gis­la­tion in 2010.

Alex Lawson, who has of­ten battled with de­fi­cit hawks as ex­ec­ut­ive dir­ect­or of So­cial Se­cur­ity Works, a group work­ing to pre­serve en­ti­tle­ment pro­grams, ad­mits feel­ing some schaden­freudeat his ideo­lo­gic­al foils’ struggles. “I won’t hide the fact that I’ve got­ten a lot of joy out of watch­ing it,” he said. “The grand-bar­gain­eers had a grip on the mi­cro­phone for so long, and it was like we couldn’t talk about any of the oth­er things we need to talk about.”

In­deed, as the gov­ern­ment’s fisc­al situ­ation has im­proved — de­fi­cits fell to a sev­en-year low as a share of the over­all eco­nomy, ac­cord­ing to the non­par­tis­an Con­gres­sion­al Budget Of­fice, even though the debt re­mains enorm­ous — fisc­al con­ser­vat­ives have star­ted ven­tur­ing bey­ond nar­row goals of re­du­cing gov­ern­ment spend­ing.

Re­pub­lic­ans such as Sen. Marco Ru­bio and Rep. Paul Ry­an, both po­ten­tial pres­id­en­tial can­did­ates, are in­creas­ingly dis­cuss­ing new ideas to tackle un­em­ploy­ment and re­duce poverty. The Amer­ic­an En­ter­prise In­sti­tute has taken a lead in de­vel­op­ing ideas it hopes will ex­pand the GOP’s eco­nom­ic-polit­ics play­book bey­ond con­cerns about the size of gov­ern­ment.

Demo­crats, mean­while, are em­bra­cing a strain of eco­nom­ic pop­u­lism lite that con­cerns it­self less with short-term de­fi­cits and debt. Just un­der half of Demo­crat­ic voters now view de­fi­cit re­duc­tion as a top pri­or­ity, down 18 points from last Janu­ary, ac­cord­ing to Pew.

With no more “ac­tion-for­cing mo­ments” like the fisc­al cliff, MacGuineas said, polit­ic­al lead­ers are happy to move on to oth­er is­sues.

The latest of those mo­ments came this month when the gov­ern­ment again came close to run­ning up against the debt ceil­ing. In the past, Re­pub­lic­ans had de­man­ded that a deal to raise the debt lim­it con­tain equal spend­ing cuts, but this time the GOP al­lowed a clean in­crease without much of a fight.

“The policies solu­tions are still so un­pleas­ant that every­one, politi­cians and voters, feels a bit of com­fort if they think they can push it un­der the car­pet,” MacGuineas said.

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