nix the debt

Could the Deficit-Scold Movement Pivot?

Erskine Bowles, chairperson of the National Commission on Fiscal Responsibility and Reform, speaks during a news conference for the Campaign to Fix the Debt at the Nasdaq Market site in New York January 8, 2013.
Erskine Bowles, doomed-movement leader. Photo: REUTERS/Brendan McDermid/Corbis

The case for a grand bargain to reduce the federal deficit was always simultaneously aggressive and toothless. What the bargaineer movement (exemplified by the Campaign to Fix the Debt) was trying to do — build a centrist coalition to shrink the deficit, via some unspecified combination of higher revenues and spending cuts — was always limited by the group’s need to be palatable to both parties. Push too hard for cuts to Social Security and Medicare, they found, and you alienate Democrats. Push for tax hikes and you lose Republicans.

Given the shaky politics of the grand bargain project — and the recent news that the deficit is indeed shrinking at a rapid clip, removing much of the urgency from the equation — it’s no wonder that the movement that coalesced around it is dissolving. Today’s Wall Street Journal effectively writes the deficit-hawk movement’s obituary, quoting White House officials who claim that the “real political will” to accomplish anything on the debt-reduction front has all but vanished, at least until the 2014 midterm elections.

I’ve been fairly harsh with Fix the Debt, a vehicle backed by billionaire and former Treasury secretary Pete Peterson, who sees the group as part of his decades-long war on federal red ink. But it’s worth giving credit to the group for what it accomplished — threading an ideological needle to unite a large group of CEOs and high-profile politicians around a common cause. Even if that cause was dubious and poorly defined, and even if it ultimately didn’t yield anything, the ability to bring together such a vast and powerful coalition speaks highly of Fix the Debt’s organizational savvy.

That savvy hasn’t resulted in much, but it’s easy enough to see how it could. As a thought experiment, try to imagine if all of the well-connected executives on Fix the Debt’s enormous CEO council gave up on deficit scaremongering and turned their attention to getting a grand bargain on climate change, or teamed up to tackle the scourge of long-term unemployment in a bipartisan way. Think of the effect such a high-powered group could have addressing income inequality, pushing for stricter gun-control measures, or lifting up failing public schools.

Of course, it’s a pipe dream to think of the bargaineer movement pivoting, in the Silicon Valley parlance, into some other progressive or centrist cause. Deficit reduction is a singular political issue, in that business leaders can advocate openly for it without showing their partisan cards. It’s easy for Howard Schultz to order his baristas to write “come together” on Starbucks cups; it’s hard for him to order them to write “background checks save lives” without engulfing himself in controversy.

There’s still a chance that the deficit hawks will have their moment later this year, when Congress takes up the debt-ceiling extension. And that slim possibility of future relevance may keep the movement together in the short term. But given the already-shrinking deficit, the ideological dissolution of the austerity movement, and the growing political impossibility of a grand bargain, it probably won’t stay together for long.

The death of the bargaineer movement is a thing to celebrate, if you’re one of a great number of people who never agreed with its aims. But, viewed in a certain light, it’s a loss even for detractors.

Yes, Fix the Debt was always centered on a self-serving coalition of business elites. Yes, its members stirred hysteria over the deficit in order to push through a harshly conservative agenda focused on entitlement cuts. But, for all of its flaws, it was a political movement that galvanized more wealthy and powerful Americans than any other in recent memory. Those elites have lost on the deficit issue, but they could win on any number of others. You almost wish the CEO bargaineers would cut their losses, admit defeat as a group, and begin rallying around the next thing.