The biggest threats to U.S. national security are the nation's domestic policies and not Iran, China, North Korea or Russia says Richard Haass, the president of the Council on Foreign Relations.

"What we do to improve our schools, our infrastructure, what we do to reduce the budget deficit…this is going to be critical in years and decades ahead," Haass says in an interview with The Daily Ticker. "The most important national security question for the coming year is actually the domestic set of issues that involves the economy."

A Council on Foreign Relations Task Force released a report last month that found the nation's ailing public school system "threatens the country's ability to thrive in a global economy and maintain its leadership role" and "educational failure puts the United States' future economic prosperity, global position, and physical safety at risk."

Haass says these policy failures and intransigence by lawmakers to seriously and vigorously tackle the looming budget crisis portends a weaker U.S. in an increasingly competitive global economy.

"The United States right now has put itself in a position of some vulnerability," he says. "We're vulnerable to the inflows of dollars, we're vulnerable on the energy front, and the challenge for the United States in the national security realm is to do things that reduce our vulnerability to the decisions and behaviors be it foreign governments or markets."

Entitlement reform, typically a "third rail in American politics," will be the top priority after the November election, regardless of who wins the White House, says Haass. The nation's current fiscal situation cannot be reversed without changes to these entitlement programs, but it's "unrealistic to look to campaign positions as a serious guide" to how the 2013 White House will fix these critical budgetary obstacles.

Budget proposals put forth by both President Obama and Republican Congressman Paul Ryan address Medicare and Medicaid spending. But there "has to be bipartisan governance moving forward" for any reform to happen, Haass says.

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