Chief executives of dozens of the most powerful US companies banded together Thursday to demand the government urgently reduce the country's debt and deficit, less than two weeks ahead of the presidential election. Executives of world-leading companies like Boeing, General Electric, J.P. Morgan Chase, Microsoft and Merck issued a letter calling for a plan that both raises tax revenues and reduces spending - issues that have divided Democrats and Republicans.
"It is urgent and essential that we put in place a plan to fix America's debt," the more than 80 CEOs said in their statement, released to The Wall Street Journal. "An effective plan must stabilise the debt as a share of the economy, and put it on a downward path."
"This plan should be enacted now, but implemented gradually to protect the fragile economic recovery and to give Americans time to prepare for the changes in the federal budget."
The letter was supported by a non-partisan organisation, The Campaign to Fix the Debt, and identical to a manifesto on their website. The campaign was founded by former White House official Erskine Bowles and former senator Al Simpson, whose deficit plan issued two years ago was not adopted by Congress and the White House. The Simpson-Bowles Commission, appointed by President Barack Obama, came up with a sweeping $4 trillion deficit reduction plan in December 2010.
But the commission's members themselves split on endorsing its mix of spending cuts and revenues increases, and the two political parties also rejected its approach. The Obama administration, for one, has insisted on tax increases for the wealthy, while Republicans have rejected tax hikes.
The political split has placed the country on the path toward the "fiscal cliff" - harsh spending cuts mandated to start at the beginning of January that, together with the scheduled expiration of tax breaks, could send the country into recession. The country's government debt has mounted to more than $16 trillion since the financial crisis, but the budget deficit has been falling in the past two years.
Based on the official budget, the US deficit will fall to $900 billion in the fiscal year 2013 that began October 1, down from $1.1 trillion in 2012 and $1.3 trillion the year before. The executives' view appeared to fall more in line with the stance of Republicans and presidential challenger Mitt Romney. They called for tax reforms that lower rates but broaden the tax base to raise revenues.
They also called for reforms to the public health programs Medicare and Medicaid, and to Social Security. "In order to develop a fiscal plan that can succeed both financially and politically, it must be bipartisan and reforms to all areas of the budget should be included."