It's widely known as the fiscal cliff, but some prominent Republicans have been calling it a "debt crisis." Economists agree such a crisis may be coming, but it's not here yet. Demographic changes are forcing a reckoning of how to pay for what people want from their government.
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The countdown continues. In 22 days, the clock runs out for Congress to spare the nation from a set of higher taxes and deep automatic spending cuts. This end-of-the-year deadline has become widely known as the fiscal cliff. But the most powerful Republican on Capitol Hill has another name for it.
NPR's David Welna has more.
DAVID WELNA, BYLINE: Debt crisis is a term normally used when the country lacks the means to repay what it's borrowed. Think threadbare Greece over the past year, or Argentina defaulting on its debt a decade ago. But for more than a year now, House Speaker John Boehner has been calling the mess Congress is scrambling to sort out now a debt crisis.
Here's Boehner after a recent meeting with Treasury Secretary Tim Geithner.
REPRESENTATIVE JOHN BOEHNER: Without spending cuts and entitlement reforms, it's going to be impossible to address our country's debt crisis.
WELNA: Idaho House Republican Raul Labrador says Boehner has hit the nail on the head.
REPRESENTATIVE RAUL LABRADOR: I think we have a debt crisis, absolutely. Spending, you know, having a $16 trillion debt and it just keeps climbing. Over the next 10 years, we're going to have at least $10 trillion additional debt.
WELNA: Still, that $16 trillion debt has not triggered the high interest rates and inflation that typically occur when a country borrows too much. Alan Auerbach is an economist at the University of California, Berkeley. He says the nation's debt can easily become a serious economic problem. But...
ALAN AUERBACH: The current size of the debt is not; it's where the debt is heading in the next few years and especially after that. And so, it's something that we need to attend to. But what we need to attend do is the trajectory we're on, not so much the current level of debt.
WELNA: And it's that prospect of the dead getting ever bigger, and interest rates rising, that worries some politicians and economists. Kevin Hassett is an economist with the American Enterprise Institute. He told Congress's Joint Economic Committee this past week that, in many ways, the sickest European nations are actually in better shape than the U.S.
KEVIN HASSETT: While the U.S. that may seem manageable to many who look it struggles in other countries, and take consolation in our relative stability, the situation in the U.S. today, when taking in the long run, is actually farther from debt stability than many other developed countries.
WELNA: But it's clear that the long run is not what Congress normally sets its sights on. James Lankford is a freshman House Republican from Oklahoma. For him, lawmakers need a short-term crisis to focus on the long-term.
REPRESENTATIVE JAMES LANKFORD: We got to have real adult conversations about how do we get the deficit and the debt under control. And if the only way to do it is this, and if Congress will only act when they have to, then we have to set deadlines and say, you have to act by this point.
WELNA: And what Congress now faces is what Maryland House Democrat Chris Van Hollen calls a manufactured crisis.
REPRESENTATIVE CHRIS VAN HOLLEN: This mechanism that was set up is the result of the Republicans holding the entire economy hostage over the debt ceiling more than 14 months ago.
WELNA: If there is a crisis, it may be the uncertainty over whether Republicans will once again balk at raising the debt ceiling in the coming weeks. Moody's Analytics' chief economist Mark Zandi warned the Joint Economic Committee last week about the ongoing peril of the debt ceiling.
MARK ZANDI: It would be nice to extend it past the next presidential election. It would be even nicer than that to get rid of it altogether. You know, I think this is anachronistic law that is a problem, creates a great deal of uncertainty and angst. And so we can see, it can do a lot of damage to the economy.
WELNA: Many economists see the nation's rising debts as the consequence of a political standoff over how to pay for the federal government's ever greater obligations. Williams College economist Bill Gentry says the real crisis may be one of demographics.
BILL GENTRY: There's the kind of running joke of, well, what the U.S. federal government is, is a large insurance company with a military attached. And, in other words, we run programs like Social Security and Medicare and these programs are going to get more and more important as the demography changes and the U.S. gets older.
WELNA: And heads towards what someday maybe a real debt crisis.
David Welna, NPR News, the Capitol. Transcript provided by NPR, Copyright NPR.