The rapidly approaching budget sequester imposes too much austerity too soon, and actually makes little headway in improving the nation’s long-term fiscal picture, writes CFR Adjunct Senior Fellow Peter Orszag.

“Far more beneficial would be to make sure that the deceleration in health costs we have been enjoying continues. This is why medical-malpractice reform, although far from a panacea, is worth trying,” he says. Read more »

While many analysts believe some defense cuts should be part of a comprehensive deficit reduction accord, they fear that the “meat axe” austerity scheduled to hit the Pentagon on Friday would needlessly undermine national security and the broader economy. Others say such concerns are overstated, noting that even if all the scheduled reductions at the Pentagon occur, defense spending would still fall within recent norms. Read more »

Economists have long argued that taxing oil consumption would be the most efficient way to address U.S. vulnerability to overpriced and unreliable oil supplies. Yet energy taxes are a third rail in American politics, and have long kept significant increases in oil taxes off the table as a policy tool. However, the growing concern over rising U.S. deficits has recently prompted some people to question whether that might change. Read more »

The opportunity for Washington to strike a meaningful deal that addresses the nation’s long-term fiscal woes is fleeting, writes CFR’s Robert Kahn on his blog “Macro and Markets.” While the sequester showdown in the coming weeks will provide policymakers with yet another chance for fiscal compromise, both parties have signaled a willingness to let the sweeping budget cuts take effect March 1. Read more »

At his confirmation hearing for secretary of state, Massachusetts Senator John Kerry stressed the need for Washington to exercise “economic patriotism” and come together in order to solve the nation’s pressing fiscal woes. Read more »

A comprehensive deal to put the United States on a sustainable fiscal path, one that includes both tax and entitlement reform, has thus far proved elusive for policymakers. As Washington gears up for a series of heated budget battles in 2013, former White House budget director and CFR Senior Fellow Peter Orszag notes how improving value in healthcare can both shore up Treasury’s bottom line and shield U.S. workers from the effects of globalization. Read more »