10/14/2011 04:37 pm ET | Updated Dec 14, 2011

Business Must Step Up to Solve the Budget Challenge

Almost every sentient American now understands that our political leaders have done nothing to address the challenges of our growing debt, other than to kick the can down the road to yet one more committee. Certainly, Standard and Poor's, the stock market and the American people have expressed a vote of no-confidence in Washington's ability to find a solution. Indeed, a recent CBS News survey found that 73 percent of Americans believe the country is heading in the wrong direction.

The budget-cutting Supercommittee faces a Sisyphean challenge as the "no entitlement cuts" Democrats must confront the "no new taxes" Republicans and somehow agree before Christmas on a deal.

So we face another meltdown scenario in late 2011 when mandatory and arbitrary cuts kick in, absent the bipartisan committee solution adopted by both Houses of Congress. The meat cleaver approach of these cuts would surely be unacceptable to almost every one remotely affected and the uncertainty itself of this approach is unhealthy, disruptive and inconsistent with competent government.

We are on a speedy train to a disaster with a vacuum in national political leadership. Like nature, the economy abhors a vacuum. In fact, this vacuum represents a huge opportunity for those who create jobs to take leadership and provide a solution. Specifically, American business leaders have an unprecedented opportunity to present a way out of this morass that will not only solve the certain impasse, but also boost the economy and create jobs.

Any grand plan business proposes must address both spending and revenue.

On the spending side, who better than business to look systemically at entitlements and make tough calls on raising the retirement age, means-testing benefits and competitive sourcing for health care? No business would spend money like the federal government does today on, say, drugs, where the government pays sole source supplier drug companies any price they ask. Businesses would also address the disincentives for Americans to pay taxes through the cash economy and seek meaningful work. And business will be able to suggest ways that new businesses and jobs can be created and formed.

A business-led solution, not subject to party constraints and pledges, would address revenue (or what we used to call taxes). A business-led plan could be modest and enhance revenue by simply advocating that all the Bush tax cuts expire. With American youth fighting two wars, I suspect most Americans would pay more in taxes if business and political leaders agreed it was appropriate and if they knew that the money was well spent.

More ambitiously, business could suggest a complete overhaul of the tax code, eliminating favored credits and deductions and moving toward a fair tax, flat tax or simply lower rates to make U.S. companies competitive world wide and individual taxpayers more equal. Business favorites such as the R&D tax credits, accelerated depreciation, and even charitable deductions would be eliminated. Also, the mortgage interest deduction could fade away, and suddenly renters would be as favored as home buyers.

Time is running out on the United States as the world's economic leader. That's why we need a business-led grand plan. Facing the possibility of decline, most Americans will sacrifice if properly inspired with real leadership. Red-blooded Americans want a strong, healthy America and a real future for their children.

Our generation may be the first that fails to give its children a better country from what we inherited. So we can no longer let our political leaders define the future. They have been defined by their left and right wings while the American people are increasingly declaring themselves independents.

With the recent and growing Occupy Wall Street anti-business demonstrations, corporate leaders would be wise to be constructive with shared sacrifice solutions today, rather than face a larger more hostile public sentiment tomorrow. It is time for business leaders to step forward and stand up to offer a vision and a plan for a national future which focuses less on filling our short term desires and more on our children's right to inherit a better country.

Gary Shapiro is president and CEO of the Consumer Electronics Association (CEA), the U.S. trade association representing more than 2,000 consumer electronics companies and author of the "New York Times" bestselling book,"The Comeback: How Innovation Will Restore the American Dream."