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The Campaign to Fix the Debt Overview
This document provides an overview and summary of the national debt situation in the United States from the perspective of the Campaign to Fix the Debt organization. It discusses how the debt has grown significantly over the past decades and is projected to continue rising. It outlines several key drivers of growing debt, including economic crises, tax cuts, spending increases, and rising healthcare costs. The document warns of potential economic consequences of high and rising debt levels. It advocates for bipartisan action to enact a comprehensive plan that reduces future debt growth in a targeted way.
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The Campaign to Fix the Debt Overview
- 1. The Campaign to Fixthe Debt April 2013
- 2. An Overview ofthe National Debt
- 3. FixtheDebt.org How bad isit? • At $11.8 trillion, the publicly held portion of our national debt is equivalent to over 73% of our entire yearly economic output • Over the past 4 decades, the debt has averaged only 39% of GDP • The debt is projected to grow over the next 10 years to 77% of our GPD 2 0% 20% 40% 60% 80% 100% 120% 140% 160% 1930 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 %ofGDP Publicly Held Debt as % of GDP Actual Projected (CRFB)
- 4. FixtheDebt.org • Economic Crisis (Lostrevenue and increased spending on safety net programs, like unemployment benefits and food stamps) • Economic Response (Stimulus spending/tax breaks and financial sector rescue policies ) • Tax Cuts (2001, 2003, and 2010) • War Spending (Iraq and Afghanistan) • Spending Increases (General ramp up in spending) • Rapid Health Care Cost Growth (Federal spending on its largest health programs are equal to 5.4% of the economy; in 25 years, they will be 9.6%) • Population Aging (Causing Social Security and Medicare costs to rise, and revenues to fall ) • Growing Interest Costs (From continued debt accumulation) • Insufficient Revenue (To meet the costs of funding government) Debt Drivers How We Got Here Why It Will Get So Much Worse 3
- 5. FixtheDebt.org Consequences of RisingDebt • “Crowding out” of private investment, leading to slower economic growth • Higher interest rates for family purchases, such as houses, cars, college tuitions, etc. • Higher federal interest payments take over an increasing portion of yearly budgets • Intergenerational inequity – passing the bill onto our kids along with a worse economy • Uncertain policy and economic environment making it harder for families and businesses to plan for the future 4
- 6. FixtheDebt.org Small Businesses andthe Debt The current climate of fiscal and policy uncertainty is particularly harmful to small businesses • Small businesses often have smaller profit margins, particularly in their nascent years. Because of this, small policy changes are more likely to make the difference between profit and loss, success and failure. • In today’s uncertain environment, small businesses have to hedge by holding back on investment in capital and hiring, because these decisions are costly and hard to reverse. This holds back growth in the entire economy. • The mounting costs of our entitlement programs threatens to crowd- out other spending priorities, including programs that incentivize entrepreneurship, such as SBA loans. 5
- 7. FixtheDebt.org A Better PathForward Targeted • Spending cuts should be smart to ensure that they only target wasteful spending, rather than gutting vital government functions Enacted Now but Implemented Gradually • A big plan would provide the policy certainty necessary for business planning, and gradual implementation would preserve the momentum of the economic recovery Addressed to the Drivers of the Debt • Any deal should focus on reining in the out-of-control growth of healthcare costs and entitlement spending, while preserving programs for those who need them most Our leaders should come together to enact a comprehensive and thoughtful plan which would be: 6
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- 9. 8 Background on the Campaignto Fix the Debt
- 10. FixtheDebt.org The Campaign toFix the Debt – Overview • The Campaign to Fix the Debt is a national bipartisan effort to encourage our elected leaders to enact a comprehensive debt deal within the next year by creating an environment where voting ‘yes’ reflects both good policy and safe politics. • The Campaign believes that the national debt is the most serious economic and national security threat facing this country, and we must come together as a nation to fix it. • To achieve this goal, the Campaign will work at the grassroots and grasstops levels through a combination of state and local coalition building, business leader support, social media efforts, Congressional outreach, and both earned and paid media. 9
- 11. FixtheDebt.org Unprecedented National Movement •Bipartisan support at the local, state and national levels • Volunteers across the country mobilized through social media and digital strategies National Leadership of CEOs and Business Leaders • Unprecedented business community support for a comprehensive plan that will reduce the debt while strengthening the economy Bipartisan Leadership in Washington • Collaboration with members from both parties to help create the environment for bipartisan fiscal reform What Makes the Campaign Different 10
- 12. FixtheDebt.org Objectives of theCampaign to Fix the Debt • Educate Members of Congress about the key elements of a comprehensive solution, building support for substantial fiscal reform and making clear the consequences of inaction • Create a political environment in which policymakers and political candidates become champions of balanced and bipartisan fiscal reform • Build a national movement to demonstrate to policymakers that supporting a comprehensive bipartisan debt solution is now the politically safe vote 11
- 13. FixtheDebt.org Campaign Leadership Founders Co-Chairs Steering Committee ErskineBowles, Co-Chair, National Commission on Fiscal Responsibility and Reform Senator Alan Simpson, Co-Chair, National Commission on Fiscal Responsibility and Reform Mayor Michael Bloomberg Senator Judd Gregg Governor Ed Rendell Governor Phil Bredesen Senator Kent Conrad David Cote, Chairman and CEO, Honeywell Pete Domenici Congressman Vic Fazio James B. Lee Jr., Vice Chairman, JPMorgan Chase & Co. Congressman Jim McCrery Senator Sam Nunn Congressman Jim Nussle Michael Peterson, President and COO, Peterson Foundation Steven Rattner, Chairman, Willett Advisors Alice M. Rivlin, Co-Chair of the Debt Reduction Task Force at the Bipartisan Policy Center Mayor Scott Smith Margaret Spellings Mayor Antonio R. Villaraigosa Senator Tim Wirth Ambassador Bob Zoellick, Former President, World Bank 12
- 14. FixtheDebt.org Coalition of Voices •Campaign Steering Committee 17 • CEO Steering Committee 31 • Partner Organizations 28 • State Chapters 23 • Former Members of Congress 100+ • Economic policy experts 100+ • CEOs and Business Leaders 170+ • State Civic leaders 601 • Small Business Owners 2,700 + • Grassroots Activists 345,000 +
- 15. FixtheDebt.org Coalition Support The Campaignhas brought on 28 partner organizations representing a broad and diverse range of perspectives and issue areas including business and trade, multicultural, millennial, economic and budget, environmental, workforce/families, and women’s issues. Partners include: • Alliance for Business Leadership • American Business Conference • American Homeowners Grassroots Alliance • American Institute of Certified Public Accountants (AICPA) • Business Industry Political Action Committee (BIPAC) • Center Forward • Christians for a Sustainable Economy • Comeback America Initiative • Committee for Economic Development • Common Sense Coalition • Concerned Youth of America • Concord 51 • Concord Coalition • Corporate Voices for Working Families • Enact the Plan • Gen Next Foundation • Greater Minnesota Economic Alliance • Minority Business Roundtable • National Gay and Lesbian Chamber of Commerce • National Parks Conservation Association • National Puerto Rican Coalition • National Small Business Association • North Carolina Association of CPAs • Rebellious Truths • Silicon Valley Leadership Group • Spend Smart America • The Can Kicks Back • Women Impacting Public Policy 14
- 16. FixtheDebt.org Grassroots Efforts: Overview •The Campaign’s Citizen’s Petition has received over 350,000 signatures to date. • More than 2,700 small business leaders are members of the Campaign to Fix the Debt. • There have been over 150,000 letters sent to Congress by our Grassroots network • FixTheDebt.org has had over 450,000 visitors to the website in 4.5 months 15
- 17. FixtheDebt.org Grassroots Efforts: States Duringthe February Congressional Recess, the Campaign hosted events in over 30 congressional districts in 23 states, including: • Arizona – State steering committee Member and owner of Pivot Manufacturing Rick Murray hosted U.S. Rep. Matt Salmon for a factory tour and roundtable discussion • Michigan – State steering committee members and small business owners met with Rep. Dan Benishek and Rep. Tim Walberg. Steering committee member and State Senator Roger Kahn spoke at the Marquette Economic Club and met with university and community leaders at an event at Northern Michigan University • Colorado – in Denver, steering committee members met with Senator Mark Udall for a round-table discussion and organized a town hall meeting with Rep. Mike Coffman and community and business leaders • South Carolina – Rep. Joe Wilson toured Smitty’s Print Shop and participated in a Q&A session with members of Fix the Debt and the local business community 16
- 18. FixtheDebt.org State Chapters The Campaignto Fix the Debt has launched state chapters in 23 states, and there are more than 600 state chapter steering committee members of the Campaign. More state chapters will be announced in the coming weeks. Below is a listing of where we have a presence so far: • Arizona • Colorado • Florida • Georgia • Iowa • Indiana • Louisiana • Maine • Maryland • Michigan • Minnesota • Missouri • New Hampshire • North Carolina • Ohio • Pennsylvania • South Carolina • Tennessee • Texas • Utah • Virginia • Washington • Wisconsin 17
- 19. FixtheDebt.org18 1352 1453 1002 8091 11033 526 930 493 391 5228 4825 1336 2156 8112 13965 7879 4973 4720 13273 3076 7850 2458 379320082592 20304 3169 1479 3924 9865 5595 26628 8441 2402 2758 6446 2525 43009 9142 5505 20725 747 1688 1326 1247 10754 7258 3897 1459 1056 1753 Note: Fixthe Debt has collected a total of 346,835 signatures for the Citizen’s Petition as of 2/24/13 = Indicates presence of Fix the Debt State Chapter Citizens’ Petition to Fix the Debt
- 20. FixtheDebt.org How You CanHelp: 19 • Sign the petition to “Fix the Debt” at FixtheDebt.org or text “sign” to 877877 • Visit FixtheDebt.org to download the Citizen's Toolkit to learn how to get involved • Send a letter to your elected member of Congress or schedule a meeting with them voicing your concern and desire for a solution • Spread the word to your friends, family, neighbors, and colleagues, as well as local clubs and associations