After voters expressed unequivocal outrage at a ballooning national debt in the United States, which soared past $13 trillion last summer, the hunt for fiscal responsibility is on.

As Washington’s policy makers bring national spending under control, they ought to make retirement savings and business growth two of their most pressing priorities, Robert Reynolds, the chief executive officer of Putnam Investments told the National Press Club in Washington, D.C., on Wednesday.

Reynolds also acknowledged that products engineered to provided guaranteed retirement income, be they annuities or other instruments that replicate them, is the “Holy Grail” for many asset management companies right now.

Reynolds said he supports several pro-business ideas that would presumably get companies to release the estimated $2 trillion in corporate storehouses at the moment. A tax holiday for investors who participate in initial public offering, would be one way to provide capital to growing companies, he said, as would a holiday on payroll taxes to spur hiring.

But first, Reynolds said, comes the major problem of the national debt, which is on pace to grow by $2 million a minute, currently. At that rate, it will account for 80% of the nation’s gross national product by 2020, Reynolds told the group of journalists.

“That is unsustainable. This is a fiscal time bomb, and I think everyone in America can hear it ticking. It is undermining long-term confidence here and at home,” Reynolds said. “I take no comfort in the fact that the Treasury can borrow huge sums at less than 3%.”

Policymakers are setting to work. In about one week, three major bipartisan committees will have discussed proposals and issued proposals on how to tame the country’s debt, and they have quite a task ahead of them. Reynolds lauded the preliminary recommendations from the National Committee on Fiscal Responsibility and Reform, a bipartisan fiscal commission organized by the White House, released last week. It proposed reducing $4 trillion from the deficit between 2012 and 2010 across the board. It would overhaul the tax code to remove a number of tax breaks, take a scalpel to spending on entitlements and defense. Erskine Bowles a top official in the Clinton White House, and Alan Simpson a former Senate Republican leader, are the committee’s co-chairs.

The two-pronged retirement savings system should see decisive overhauls, Reynolds said. The Bowles-Simpson committee calls for middle-class and wealthy Social Security beneficiaries to accept smaller increases in benefits, not absolute cuts. It also called for raising the retirement age to 68 by 2050, which gives current workers in their 20s about 40 years to plan for retirement. The retirement age would be kept at 62 for workers who do arduous physical work. 

“Once you tune out the hysteria and hyperbole from the right and the left, it is clear it does not require draconian measures,” Reynolds said. “It just needs common sense; and uncommon political courage.” Reynolds said he does not believe Social Security needs to incorporate private accounts to make it solvent.

Few inside and outside the Beltway expect all of Bowles-Simpson proposals to be written into law, but it demonstrated that the tone in America had changed.

On the private side, Reynolds said, Congress should act on the proposal to institute a universal individual retirement account system. Also, asset managers are in a race to develop products that provide guaranteed retirement income, effectively duplicating annuities. One idea involves creating a national insurance charter and create an industry-funded capital pool, similar to the Federal Deposit Insurance Corp., and get workers to participate via automatic enrollment and automatic increases.

Reynolds supports taking the best ideas from the public and private sectors, without suggesting draconian measures that would force negotiators to dig in their heels. He said while it is still important to “lift the animal spirits of business owners and entrepreneurs” to get the economy moving again the measures do’t have to wipe out the deficit completely or enforce a balanced budget overnight.

“This is not austerity, this is sanity, and comprehensive retirement reform is a key element,” he said. “It is the foundation for the new solvency.”