January 15, 2013

What’s in a name? Sometimes everything.


Take the so-called “fiscal cliff.” The name attached to the issue is conjuring the wrong kind of discussion. Each day, as we move closer to the January 1 deadline, the headlines and sound bites continue to signal catastrophe. From cataclysmic spending cuts to massive tax increases to nightmarish economic scenarios, the language couldn’t be more fatalistic.


And now that President Obama is back in town and Speaker Boehner lies in wait in Ohio, the fear is that Washington will become captive to its own language. Some commentators have pointed out the term “fiscal cliff,” popularized by Fed Chairman Ben Bernanke, might be obscuring what’s at stake. Very few, however, have noted that the name itself actually makes reaching a deal more difficult. The fact is this extreme rhetoric makes it nearly impossible to take a sober assessment of the situation and only serves to turn off an already disillusioned public.


Advocates of compromise on both sides of the aisle can do better. In fact, they would do well to re-brand the current debate in a way that opens dialogue and public engagement, not shuts it down. We recommend talking about the country facing a “fiscal reset” if compromise isn’t reached.


First, this term is more accurate. While failing to reach compromise will have a negative impact on credit ratings and the economic strength of public programs, the impact would neither be as catastrophic or permanent as the cliff imagery suggestions. With a reset, there are serious, negative consequences: You have to start over. But there are also opportunities: You get to start over. See what a difference one word makes?


But this goes beyond accuracy. Labeling the current debate a “fiscal reset” could actually be productive. It would set up the issues facing lawmakers in a way that acknowledges the need for change and starts us on the road to compromise. Instead of focusing on what’s as stake if we fail to come to some agreement on what to do, we could focus on the positive – the reset – that is in order to strengthen the country’s economic position.


Changing the language around the issue wouldn’t alter the automatic cuts or tax increases that would kick in if a compromise isn’t reached. But it would rewrite the usual Washington script in a way that’s far more amenable to actual conversation. And, by making the issues at hand less fatal it would help draw in the public.


By positioning the situation as a reset, we could now look at the three main policy areas through a very different lens.


1) Taxes. Many Americans believe it’s time for Congress and the administration to hit the reset button when it comes to the US tax code. But lawmakers seem firmly locked into their positions. And the idea that we’re running off a cliff hasn’t changed that. Now imagine if we were talking about the terms of a reset. No doubt there’d continue to be widely divergent views and the desire to dig in heels, but both sides would be entering the discussion having first acknowledged the need to reset things.


2) Entitlements. Whatever you may think of entitlement programs for the old and poor the math no longer works out. There are simply too few workers to support the growing number of retirees, let alone the rest of the government benefits. So what to do about it? While the principals are embroiled in negations on the particulars, average Americans have their voices reduced to a yes or no: do you support entitlements that are going to drive us over the edge or not? Switching an entitlement cliff for an entitlement reset changes the conversation.


3) Defense spending. As many defense analysts have pointed out, our current military is structured based on plans and decisions made decades ago in a wildly different world. It may now be time to have a debate about whether the structure—let along that level—of spending makes sense. we’re trying to avoid the need for the discussion. A reset implies an opportunity to have it. By changing the way we talk about the automatic spending cuts we could setup a situation where those conversations could more readily take place.

As the New Year approaches, a legitimate worry is that policy makers will now produce a “least of” short-term plan that narrowly averts the “crisis.” By reframing this whole debate around the need to “readjust” and “recalibrate,” we can get rid of the finger pointing and childish games. Rather than jumping off a cliff, our leaders would be forced to reset our national agenda and finally attend to the people’s business.

more insights