American CEOs call the Congress to 'stabilize the debt'
The CEOs call on the policymakers to prepare a fiscal plan that would “stabilize the debt as a share of the economy, and put it on a downward path,” reports the Wall Street Journal, citing the statement. The plan should limit costs of Medicare, strengthen Social Security and "include comprehensive and pro-growth tax reform, which broadens the base, lowers rates, raises revenues and reduces the deficit," the CEOs say.
The US deficit in 2012 is estimated to reach $1 trillion for a fourth year in a row, bringing the national debt by $16 trillion or about 102% of GDP. The US economy also faces a probable slowdown in 2013 – the "fiscal cliff" of automatic spending cuts and tax increases that will take effect early next year as some tax breaks expire. If the Congress fails to balance the tax hikes and spending cuts it could trigger the economy back into recession.
The CEOs' manifesto was prepared under the campaign called "Fix the Debt," organized by Republican Alan Simpson and Democrat Erskine Bowles, who chaired a 2010 deficit panel appointed by President Barack Obama. In a statement corporate chiefs urge policymakers from both parties to join in efforts to prepare the plan “that can succeed both financially and politically, it must be bipartisan and reforms to all areas of the budget should be included."
Though corporate chiefs are calling for immediate action to curb the deficit, they warned that the plan should be “implemented gradually to protect the fragile economic recovery and to give Americans time to prepare for the changes in the federal budget”.