It has taken a while, but many of the 2016 presidential candidates have begun talking about how $18.6 trillion in long-term debt could threaten the U.S. economy, and what they would do to address it if they manage to succeed President Obama in the White House.
There are a number of explanations for this growing interest in the debt: The international debt crises in Greece and Puerto Rico’s dangerous spiral into bankruptcy have prompted questions about whether the U.S. could be headed for similar problems in the coming decade.
Related: Presidential Candidates Are Finally Facing Up to the $18.6 Trillion Debt
The non-partisan Congressional Budget Office has repeatedly warned that the U.S. government could return to the days of trillion-dollar-a-year annual deficits in the not too distant future unless there is a dramatic change in U.S. fiscal policy to deal with entitlement programs like Social Security and Medicare as the Baby Boomers retire.
While the debt may get only a glancing mention during the first GOP presidential debate in Cleveland Aug. 6, budget watchdog and anti-deficit groups have begun putting pressure on the candidates to explain their views on averting a long-term debt crisis.
The responses by the 16 announced GOP presidential candidates and the five Democratic presidential aspirants have been varied – and range from very substantive and bold to boiler-plate party dogma to just plain unrealistic.
Related: New CBO Director Renews Warning on Long-Term Debt
Here are summaries of what the candidates say they would do to tackle the country’s long-term debt problem, based on their public statements, a compilation of candidates’ views compiled by the Committee for a Responsible Federal Budget, and statements on candidates’ campaign websites:
BIG IDEAS
Chris Christie -- The Republican New Jersey governor has proposed the boldest and politically riskiest plan, calling for entitlement and tax reform and stronger economic growth. Christie would gradually raise the Social Security retirement age and Medicare eligibility ages to 69; alter the CPI adjustments for retirement benefits; means test Medicare premiums for the elderly, eliminate the payroll tax for those over 62 or younger than 25, and reform the Social Security Disability Insurance program.
Lindsey Graham – The Republican senator from South Carolina is a leading advocate of entitlement reform and balances deficit reduction with a combination of spending cuts and increased revenue. He is the only candidate willing to endorse the recommendations of the Simpson-Bowles presidential deficit commission that would cut spending and raise taxes.
Related: The Next Debt Crisis Could Be Much Worse than in 2013, GAO Warns
BOILERPLATE PROPOSALS
Marco Rubio – The Republican senator from Florida favors a dual approach of spending cuts and entitlement savings, as well as changes to the federal tax code to spark economic growth. He would alter the way benefits for the elderly are indexed to save money and would revamp Medicare so that individuals would have the option of purchasing a private insurance plan if they choose. He also supports a balanced budget amendment to the Constitution.
Donald Trump – The Republican real estate magnate and reality TV personality has said that the debt is an important issue but has provided few clues as to how he would fix it. One way would be for the U.S. to stop being the world’s policeman and have other countries pick up more of the cost of providing security. Another is to maximize government revenue collections. While Trump has not offered a specific plan on entitlement reform, he said he would not favor cuts to Medicare or Social Security – which he says are too politically risky.
Hillary Clinton – The former secretary of state and frontrunner for the Democratic nomination has yet to address the debt in any detail. But she says she will help families by “defending and enhancing Social Security and making it easier to save for the future.” She has denounced Republican proposals for privatizing Social Security, and has emphasized the importance of restraining health care costs and making prescription drugs more affordable.
Jim Webb – The former Democratic senator from Virginia has said he would cut the federal budget by calling for “bottom-up program reviews” in all federal agencies and would work across party lines to try to reduce the national debt. As a senator, he voted against a balanced budget amendment to the Constitution.
Martin O’Malley – The former Democratic governor of Maryland left office in January with a legacy of one of the most progressive agendas in the nation – and also a long-term structural deficit that his Republican successor has had to wrestle with. O’Malley has had little to say about the federal debt, and instead has focused on proposals for helping the middle class, including his “debt-free college plan.” He says that rather than reducing Social Security benefits or privatizing them, we must expand benefits so all of our seniors can retire with dignity.
Lincoln Chafee – The former Republican Rhode Island senator and governor who is now running as a Democrat opposed the Bush era tax cuts and supported the privatization of Social Security to deal with the debt. As governor, he tried to expand Rhode Island’s sales tax to close a budget gap, but he later oversaw a reduction in the state’s corporate tax rate to 7 percent from 9 percent.
Related: How the GOP Budget Could Help Hillary in 2016
Ben Carson – The retired Johns Hopkins neurosurgeon and GOP candidate has made getting the debt under control a top priority. He has stressed the need to reduce deficit spending where possible, and has urged using tax and regulatory reform to get people to engage in entrepreneurial risk and capital investment that would spur economic growth. He also supports a balanced budget amendment.
Ted Cruz – The Republican senator from Texas, like many other candidates, says the long-term debt must be brought down through economic growth and reining in spending. He favors entitlement reform, including gradually raising the retirement age and altering adjustments in benefits to more accurately reflect inflation. He also thinks that younger workers should be allowed to keep a portion of their taxes in an account that they can control and pass on to their own children. And he supports a balanced budget amendment.
Mike Huckabee – The former Republican Arkansas governor says the debt must be lowered by reducing spending and spurring economic growth. And of course, he supports a balanced budget amendment. But Huckabee has been insistent that Medicare and Social Security benefits should not be reduced because it would be unfair to deny benefits to people who have paid into the system. His idea of entitlement reform includes giving retirees the option of taking a lump-sum cash payment upon retirement.
Rand Paul – The Republican senator from Kentucky says that the debt poses one of the biggest threats to society. He would address the problem through entitlement reform and across-the-board spending cuts. Without specifying an overall strategy, Paul would gradually increase the Social Security retirement age – possibly to 70 – and means test benefits. He also supports a balanced budget amendment.
Related: GOP Presidential Aspirants Clash over the Budget
Rick Santorum – The former Republican senator from Pennsylvania says economic growth should be central to any long-term debt reduction plan, and that would require tax reform, tough spending cuts and changes to the entitlement system. He also supports a presidential line item veto and a balanced budget amendment.
John Kasich – The Republican Ohio governor and former House Budget Committee Chairman during the Clinton administration has had plenty of practical experience in balancing budgets. He says he would use that to address the current long-term debt problem. He compares the federal debt to the great fire of Rome and blames Republicans and Democrats equally for blowing huge surpluses--which he helped to produce--on wars in Afghanistan and Iraq and the Bush-era tax cuts.
Carly Fiorina – The former CEO of Hewlett-Packard and the 2010 Republican nominee for the U.S. Senate in California has said little on the spending and debt issues. She has emphasized the importance of transparency in government spending and moving towards zero-based budgeting, but has offered few other specifics.
Rick Perry – The former Republican Texas governor has said he would attack the debt by capping federal spending at 18 percent of GDP, passing a balanced budget constitutional amendment and eliminating the budget deficit by 2020. He would also oppose raising the debt ceiling without accompanying spending cuts and enforceable budget caps in place.
Related: Wall Street Knows Greek Debt Drama Is Far from Over
George Pataki – The former Republican governor of New York has spoken about the need to overhaul entitlement programs, such as by raising the retirement age for Social Security and increasing Medicare copays. In 2011, he launched an advocacy group promoting the cause of deficit reduction.
Bobby Jindal – The Republican governor of Louisiana says he would cut the size of the federal government, just as he cut the size of his state. “They say you cannot actually cut government spending,” Jindal said in announcing his candidacy. “We can and we will.”
BLUE SKY IDEAS
Jeb Bush – The former Republican Florida governor says that the debt must be brought down through higher economic growth, better prioritizing of government spending and reforming the tax code. But his pledge to make 4 percent annual economic growth the norm in the U.S. as part of that strategy seems pretty close to unattainable in the near-to-medium term, according to the non-partisan Congressional Budget Office and other economic experts.
Bush has said he is open to raising the Social Security retirement age to between 68 to 70 years. He has also indicated support for means testing benefits for seniors. He, too, is open to a balanced budget amendment.
Related: Why Greece Can’t Grow Its Way Out of This Mess
Scott Walker – The Republican governor from Wisconsin has a simple – and highly unrealistic – idea for addressing the national debt. He would essentially transfer federal social programs such as Medicaid and food stamps to the states to fund and operate. Walker has an unshakable belief that states can run programs more cheaply and efficiently than the federal government. But politicians for years have broken their picks on proposals for converting federal programs into block grants and shipping them to the states. Walker has indicated he would preserve Medicare and Social Security benefits for those retired or near retirement, while raising the retirement age for those who are younger.
Bernie Sanders – The Vermont senator and self-described Democratic socialist says he is concerned about the long-term debt, but believes that other problems – such as income inequality and unemployment among the middle class -- should take precedence and that wealthy Americans should pay more in taxes.
Sanders’ notion of entitlement reform includes increasing Social Security benefits and lifting the caps on the amount of earnings that are subject to the payroll tax so that wealthier Americans pay more. He also supports free tuition for students attending public colleges and a “Medicare for all” single-payer healthcare plan.
