Erskine Bowles Fighting Debt Until the Death
Erskine Bowles says being a university president is like being the CEO of a cemetery: "You've got lots of people underneath you, but ain't nobody listening."
Mr. Bowles served as president of the University of North Carolina from 2005 to 2010. But he more famously served in another position where nobody listened to him, as well.
He was the Democratic co-chair of President Barack Obama's National Commission on Fiscal Responsibility and Reform with former Republican U.S. Sen. Alan Simpson.
"We face the most predictable economic crisis in history," Mr. Bowles said last week at an economic forum sponsored by BBVA Compass bank at The Ritz-Carlton hotel in Denver.
This was the same line I heard him use in December 2010 at a much cheaper hotel in Cheyenne, Wyo. That is when he and Mr. Simpson unveiled the largely ignored Simpson-Bowles plan.
That was about $3 trillion ago. The national debt is now $16.4 trillion, and there is no reason to believe it won't top $20 trillion by the end of President Obama's second term.
Why not make it $25 trillion? The House is set to vote this week on some legislation that Republicans put up to suspend the latest debt ceiling until May. Meantime, the Federal Reserve is still buying $85 billion worth of Treasurys and mortgage-backed securities every month, and it's holding interest rates to nearly zero, which enables our government to borrow more.
If the U.S. wasn't borrowing and spending all this loot, it would be back in recession. What's better? A balanced budget? Or an economy that isn't, at least technically, in a recession?
We borrowed trillions of dollars and averted the Great Depression Part II. By most measures, our economy has grown since the big crash, albeit anemically and somewhat joblessly. So I asked Mr. Bowles if maybe the big spenders were right and he was wrong.
"You can't keep printing money forever," he said.
Yes, but nothing is forever. The "most predictable economic crisis in history" could still be a long ways off with all those other countries handing us their money. Take what you can now. This is the American way.
"These deficits are like a cancer," Mr. Bowles told his audience. "They are a cancer that will destroy our country from within if we don't start addressing them, now."
It seems nothing can throw him off his Chicken Little, fiscal responsibility game. He now is stumping for the "Campaign to Fix the Debt" that he and Sen. Simpson started.
He says the revenue that our federal government currently collects basically just covers entitlement programs--such as Medicare and Social Security--and the interest we must pay on our enormous debt.
"That means every nickel we spent last year, on the war, national security, homeland security, education infrastructure, research...was borrowed," he said. "And half of it was borrowed from foreign countries. That is crazy."
If we ever had to defend Taiwan against China--as called for in a longstanding treaty--we would have to borrow the money from China to do it, Mr. Bowles said.
"If you listen to these clowns in Washington on both sides of the aisle...all you ever hear them talk about are waste, fraud and abuse, foreign aid, oil subsidies, Nancy Pelosi's airplane. You could take these things and put them in a thimble as far as their relative degrees of importance."
Mr. Bowles, however, is something of a Washington clown himself. If Congress and the president wanted to cut the debt, they would have done it already. They wouldn't have appointed a committee.
This was pretension from the beginning. And then, when the committee couldn't agree on a way to even pretend to do it, Mr. Bowles and Mr. Simpson came up with their own plan. Did they really think they could pull it off by themselves against the will of a nation that refuses to be in a recession?
Mr. Bowles jokes that he prefers the name "Simpson-Bowles" to "Bowles-Simpson" since "everything in Washington is known by its initials." He also concedes that neither he nor Mr. Simpson have to run for re-election.
"These guys want to keep their jobs," he said. "It's hard to be re-elected if you tell people "I'm going to cut your benefits and raise your taxes.'" But that is what needs to be done.
His remaining hope is that enough Americans sign a petition at his website, fixthedebt.org, to give politicians enough political cover to do their jobs.
I asked Mr. Bowles if he was angry that nobody really listened.
"I am mad," he said. "I am frustrated. But I'm a true believer. I believe we have to do this. I'm not a quitter. I'm going to stay at it until the last dog dies."
Then maybe he really will see what it's like to be the CEO of a cemetery.
(Al's Emporium, written by Dow Jones Newswires columnist Al Lewis, offers commentary and analysis on a wide range of business subjects through an unconventional perspective. The column is published each Tuesday and Thursday at 9 a.m. ET. Contact Al at al.lewis@dowjones.com or tellittoal.com)