"The Moment of Truth" or the Simpson-Bowles Report by the National Commission on Fiscal Responsibility and Reform, Circa 2010
Nashville financial adviser grabs deficit ax
Nashville Business Journal by Brian Reisinger, Staff Reporter
Date: Friday, April 27, 2012, 5:00am CDT
Tim Pagliara is chairman and CEO of CapWealth Advisors in Franklin.
Nashville financial adviser Tim Pagliara is spending tens of thousands of dollars - and untold time - spreading the gospel of a bipartisan plan to slash the nation’s debt after last year’s congressional impasse enraged him.
But it was on a flight to Florida in a random chat with Bill Cunningham, a director for Southwest Airlines, that it clicked.
What this country needs, he said, is a grassroots network of CEOs.
“That’s my role,” Pagliara said in an interview from his Franklin office. “There’s too much conversation around the (Washington beltway).”
The chairman and CEO of CapWealth Advisors is launching the latest phase of his public advocacy effort: Jet-setting around the country to recruit CEOs in New York, Washington, D.C., the West Coast, here in Nashville and elsewhere.
His C-level crusade comes after a March announcement that he had launched Citizens for Enacting the Simpson-Bowles Plan - a nonprofit managing a website and running an advertising campaign - and as the Tennessee congressional delegation becomes more engaged on the issue. Whether Washington ultimately solves the debt woes, experts say, affects the long-term stability of the U.S. economy, as well as everything from interest rates to government spending that directly impact the business environment.
Pagliara’s case is relatively simple, but he’s tackling a complex problem.
The financial adviser said Simpson-Bowles - hashed out by the National Commission on Fiscal Responsibility and Reform - is a balanced solution that proposes both spending cuts and reform to the tax code. Frustrated as financial markets gyrated wildly during the congressional battle last fall, the 55-year-old Pagliara studied the plan, watched hours of testimony and emerged a believer.
His effort was enough to get a phone call from Erskine Bowles, the former chief of staff to President Bill Clinton who chaired the commission with Wyoming Republican Alan Simpson. In a phone call this week, Bowles said Pagliara’s push and others like it contribute to a critical mass to solve the “most predictable economic crisis in history.”
“I thought it was exactly what needs to be done,” he said of Pagliara’s effort.
Now, Pagliara is gearing up for a pitch to a “short list of very influential CEOs,” and said he’s gotten initial commitments from business leaders awaiting his full plan. He’s already put up more than $50,000 of his own money toward his nonprofit’s advocacy. Experts say tackling the debt crisis is worthy, but difficult.
“It’s a political thicket because you can’t make everybody happy, completely,” said John Geer, a political science professor at Vanderbilt University. “There are just land mines and quicksand all around.”
Among the land mines: Scores of interest groups with money, influential members and, in some cases, grassroots constituencies of their own, all with different ideas about how to reform federal spending. Geer said Pagliara’s group could break the impasse if it was able to convince Republicans they’ll have to accept some tax increases.
The Bowles-Simpson plan proposed some tax increases, technically, but Pagliara said the area of opportunity is tax reform. Getting rid of tax loopholes and lowering rates, Pagliara said, can increase revenue without meaning broad tax increases, and entitlement spending also can come down in a balanced way. He’s traditionally voted Republican, but said there’s enough blame to go around on both sides.
Upcoming moves include connecting with friend Ron Baron - an influential New York investment manager who has agreed to help - and his Rolodex of CEOs, and Pagliara said he has sages in other parts of the country lined up as well. He also figures about 5,000 people — clients and their attorneys, accountants and business managers - have heard his pitch through various talks, quarterly newsletters and other venues.
For Pagliara - a St. Louis native who has climbed Mt. Kilimanjaro - the solution lies in showing enough “tenacity” to get business leaders and voters engaged.
“Sometimes the simplest ideas are the best ones,” he said.