The heavy posturing in Washington over fiscal policy makes it difficult to focus on the stark reality presented by the Congressional Budget Office. Federal budget revenues in the US have fallen from 18.5 per cent of gross domestic product in 2007 to a projected 15.8 per cent in 2012, while federal spending levels have risen from 19.7 per cent to a projected 23.4 per cent, according to the CBO. Much of this growing gap can be attributed to the economic conditions that have existed during this period. However, it is clear that a return to normal growth rates alone will not fix the US’s structural flaws.

We were active participants the last time the federal budget was balanced (more than a decade ago, in 2001) and maintained a bipartisan agreement to use any surplus to pay down federal debt. Over a four-year period, budget surpluses totalled $559bn and debt held by the public was reduced from 46 per cent to 33 per cent of gross domestic product.

We believe comprehensive changes must now occur to get us heading in that direction again. As part of this effort, Washington must have a thorough debate on fundamental tax reform. We are unaware of a single American that is satisfied with the existing tax structure. The current haphazard pattern of extending expiring tax provisions, delaying ominous provisions such as the alternative minimum tax and adding new complexity almost every year, simply cannot be sustained.