A plea for deficit reduction

by David Hemmer | 11/16/93 6:00am

Former U.S. Senators Paul Tsongas '62 and Warren Rudman called for spending cuts and tax increases designed to eliminate the federal budget deficit over eight years in a speech last night to a capacity crowd in Webster Hall.

They claimed the federal budget is laden with excessive entitlement spending, including social security, Medicare and civil service pensions, and condemned politicians for their failure to warn the American public about the dangers of excessive federal spending.

Rudman, a New Hampshire Republican, noted that in 1989, 50 percent of Americans believed that waste, fraud and abuse, congressional salaries and foreign aid were the main contributors to deficit spending. But these items make up a small portion of the budget, he said.

Eighty-five percent of the 1992 federal budget was comprised of entitlement, defense spending and interest on the national debt, which is currently set at about $4.4 trillion, according to Tsongas, a Massachusetts Democrat.

Even if the budget only included interest spending, defense programs and the entitlement programs, the federal deficit for 1992 would still have been more than $100 billion.

"How can people be so plugged in [to local politics] and yet so wrong about their federal government?" Rudman said.

Rudman attributed the differences between public perceptions and reality to politicians who deceive the public to get reelected. He also said the media ignores the larger problem of entitlement spending while focusing on specific examples of government inefficiency.

Last year Rudman, Tsongas and Peter Peterson founded the Concord Coalition, a grassroots organization created to champion deficit reduction.

The Coalition's "Zero Deficit Plan," introduced last September, promises to eliminate the federal deficit by the turn of the century with $180 billion in spending cuts and $71 billion in tax increases.

Many of the spending cuts are achieved by eliminating entitlements, beginning with families earning more than $40,000 a year and increasing so that those earning more than $120,000 a year would lose 85 percent of their entitlements.

Without drastic reforms in the federal budget, 25 percent of every paycheck will go to the FICA tax, a combination of social security and Medicare. This is more than three times the current tax, according to Rudman.

"[Students] know their future is bleak and they're right ... they will be the first generation that will have a standard of living less than their parents," Rudman said.

Rudman is concerned that today's youth will refuse to pay these exorbitant taxes. He predicted a "generational war the likes of which we have never seen in this country" if reform is not undertaken soon.

Both senators spoke extensively of "generational responsibility" and the obligation of the current generation to not burden the next with more debt.

"We should be able to tell the future generation ... that this generation will leave them with more than the shirts on their backs," Rudman said.

The speakers claimed that many groups believe that when the federal government provides funds or programs, "nobody pays for it."

"If the American people want something badly ... then damn it we have the obligation to say 'if you want it you've got to pay for it.' It's underlying common sense," Rudman said.

Tsongas began his speech with an analysis of the events leading up to the 1992 presidential campaign and his candidacy for the Democratic nomination.

After the Persian Gulf war, George Bush's approval rating stood at 90 percent, and the Democrats had little hope of seizing the presidency. Tsongas joked that the Senate voted to "cancel the election and hold a coronation."

Tsongas said he ran for the Democratic nomination because he believed America was no longer competing in the world market and the political parties were not dealing with the enormous increase in the national debt.

Tsongas contrasted his goal of educating the American people with the Republican campaign strategy that he said ignored the hard choices facing the American public.

He said he wanted to combat the image of all Democrats as "people who like to spend money and ... believe that their job is to redistribute wealth."

Tsongas campaigned for the nomination on a pro-business platform that emphasized fiscal responsibility. He beat Bill Clinton in the New Hampshire primary, the first primary of the campaign season.

Tsongas said he was forced to withdraw from the race because his campaign was going into debt, but he noted that he won primaries or caucuses in nine states.

We "sacrificed the messenger to preserve the message," Tsongas said.

He stressed that both parties must adjust after the election and said successful Democrats in the future must abandon a "pro-employment, anti-business" viewpoint.

Tsongas said Republicans must stop their rhetoric on fiscal responsibility and convince the public that they can balance the budget.

"There's a vast difference between a balanced budget amendment and a balanced budget," he said. He called the balanced budget amendment "a horrible idea whose time has come."

Tsongas also discussed the role of Ross Perot who came in third in the 1992 election on the Independent ticket.

"Despite every instinct I have, I liked him," Tsongas said.

Perot told the truth to the American people about the deficit, according to Tsongas. He ran the "best campaign ... in terms of educating the American people," Tsongas said.

Rudman commended Clinton for trying to relieve the deficit problem. "The president tried to do something about it, and he did," Rudman said.

Rudman called for much more of the same. With the economic plan, "In 1996 we're back where we are now but with a vengeance," Rudman said.

Tsongas spoke first and spent 10 minutes speaking about Dartmouth.

"We used to prosecute Dartmouth graduates who turned Democrat," Tsongas said.

The speakers fielded question after their talks. The questions focused on topics including the North American Free Trade Agreement, term limits, estate taxes, heath care reform and the cost of a college education.

Tsongas said that in a meritocracy, "the best and brightest need to get to the top," but noted that this cannot happen if people cannot afford a college education.

He advocated a plan in which the government would support students who could not otherwise afford a college education. Students could either pay the money back directly or as a percentage of their income for the rest of their lives.

"You will not see a health plan coming out of Washington next year that will even resemble the Clinton plan," Tsongas said. According to Rudman, many Washington insiders are worried that cost estimates for the plan may be off by as much as 400 percent.

Both speakers strongly support NAFTA. "I think it's a no-brainer ... this discussion has become hysterical," Rudman said.

Tsongas called the debate the "ultimate example of [political action committees]" and said "there are too many Democrats who have decided that their own reelection is more important than the country's best interests."

Less than half of the audience was made up of students. Tim Young '96, president of Young Democrats at Dartmouth said, "They made a convincing case for federal responsibility and did so in a bipartisan manner. It's an important message, especially to our generation, which is going to be stuck paying for the mistakes of the past generation."

Bill Hall '96, vice president of the Conservative Union at Dartmouth, said, "I was really impressed with both Mr. Tsongas and Mr. Rudman. The scary truth is that they are right. Our nation is in a crisis because of the fact we are mortgaging our future."

The event was sponsored by the Rockefeller Center and the League of Women Voters of the Upper Valley.