A fine mess
: Yesterday, I went to 21 to attend the latest lunch thrown by The Week magazine, this time — appropriate to the venue — a debate about the economy with former Treasury Secretary Robert Rubin and rich smart guy PEter G. Peterson and then with CNBC’s Lawrence Kudlow, Yale’s Michael Graetz, and the irritating tax nudge with the Sesame Street name, Grover Norquist.
Peterson stole the show. He argued convincingly (not that sane souls need much convincing) that we are in a budget crisis that is being handed to our children with an $11 trillion shortfall in Social Security (“one of the oxymorons of our time — the trust fund; it shouldn’t be trusted and it’s not funded”) and a coming Medicare crisis that’s “three to four times more difficult than Social Security and harder to solve.” He also said we’re in a savings crisis with the U.S. savings rate falling from 8 percent of GDP 12 years ago to .2 percent today.
Peterson proposed mandated savings (a la Chile, Singapore, and now Australia) in global index funds and fixed income bonds. He didn’t get much disagreement from Rubin or even from Kudlow.
Rubin and Petersen also agreed that our real problem is that we don’t sense the crisis. Witness Kudlow, who goes on about how peachy things are in the economy now; no need to worry; no need to upset anything.
“What we need is a massive dose of truth-telling,” Petersen said. He suggested following the example of the 9/11 Commission to get high-level brains (e.g., Rubin, Voelker, Nunn) to come up with the tough solutions the pols are unwilling or afraid to propose. Added Rubin: “The fundamental problem is our political system is no longer for the most part willing to make decisions that are difficult.”
Amen. And I, too, have wanted to see 9/11-Commission-like groups tackling health care and insurance. But isn’t that what our legislatures are supposed to do? Isn’t that why we elect them? Isn’t it a bit frightening that we need to set up shadow legislatures — which is what these commissions really are — to separate themselves from politics and get real work done? Whatever it takes….
Rubin added that media holds a lot of the responsibility for the problem and the solution and I agree. We need to be part of that massive truth-telling. We need to find the ways to raise the alarms. Said Rubin: “Public officials need to feel as if they are going to be held accountable by an informed electorate.”