Now that the elections are over and it is again legal to talk sense about the American economy, it seemed a good time to check in with J. Peter Grace, the fellow who could have saved us all the agony if only more people had been paying attention.
Not surprisingly, Grace does not think this has been a year to cherish in the history of constitutional statesmanship. When I reminded him that he had once caused a stir in this column by denouncing the 535 members of Congress as "clowns," the crusty, 77-year-old executive not only was unrepentant, he indicated that he had been far too charitable."They're worse than clowns," Grace told me. "They're crooks. They're holding us all hostage."
Grace is the still-active chairman of W.R. Grace & Co., as well as of the Grace Commission, one of those rare good things to come out of Washington - and therefore one that has been widely ignored ever since. President Reagan named Grace to head what was officially called the "President's Private Sector Survey on Cost Control," in an effort to answer the cynical question that arises any time anyone suggests that federal spending might be getting ridiculously high: "Yeah, but where would you cut?"
The commission came up with a detailed plan to cut $424 billion in wasteful spending over three years, a proposal that would almost have eliminated the federal deficit - and without raising anybody's income taxes by one cent. Nor did the plan involve painful cuts in social or defense programs; as Grace puts it, "Our job was to cut waste. Our proposals don't cut program benefits."
But, however much such savings would have been welcomed by the beleaguered American taxpayer, they were understandably anathema to vast segments of Washington's bureaucratic establishment. And so, while Grace calculates that 28 percent of his commission's recommendations somehow did get implemented, the great majority languish on the shelf - while the capital's lawmakers and pundits continue to tell us there is no substitute for ever-higher taxes. No wonder Grace denounces the whole process as "dishonest," with no mercy for either the White House or congressional participants in the latest budget fiasco.
For one thing, he thinks taxpayers at all income levels should be outraged by such new "gimmicks" as disallowing 3 percent of deductions for high earners. "You can bet that will spread, and get to 8 or 10 or 12 percent," he said. "A lot of people will, as a result, be leaving the high-tax states such as New York."
Nor will the rest of the nation prosper, Grace believes. "I don't think the capitalist system can progress when you repeatedly go around taking more money from people."
He wishes more media attention had been paid to the recent finding of the controller general's office that the federal government currently loses at least $185 billion a year to outright waste. "What right do you have to raise more tax money from people when you are wasting $185 billion?" Grace asks.
A man whose commission came up with no fewer than 2,478 waste-cutting recommendations can be pardoned for sounding somewhat peevish when the current Washington crowd, as he acknowledges, "pay no attention." Grace believes the answer must eventually reside in an educated and aroused citizenry turning against the entrenched time-servers in Congress: "The only solution is just to wipe out 535 people and start all over again."
But surveying the reality of government debt mushrooming from 23 percent of GNP in 1975 to twice that figure today, and observing that a continuation of that trend for the next 15 years would truly transform us into a "banana republic," Grace is back on the non-political campaign trail, fighting to get some real cuts in Washington spending.
He hopes the size of next year's deficit - which he foresees in the $300 billion range, despite all the recent promises - will help galvanize the citizenry. But Grace knows some things never change; one of his favorite quotes says: "The budget should be balanced. The Treasury should be refilled. Public debt should be reduced. The arrogance of officialdom should be tempered and controlled, lest we become bankrupt."