The New York Times columnist and Nobel Prize-winning economist recently wrote a column attacking a bipartisan proposal to reduce the nation’s debt problems, arguing, “We’re not facing any kind of a fiscal crisis.” He maintains that President Barack Obama, if reelected, should reject calls to resurrect the debt-reduction blueprint.

The only problem with Krugman’s critique? It is hard to find anyone who actually agrees with him. He’s certainly not getting assent from Alan Simpson and Erskine Bowles, who headed the panel that crafted the ideas Krugman is now attacking. Nor will the economist find much support from the 44 CEOs of Fortune 500 companies who are now advocating the plan. And most notably, perhaps, he’s not charming former President Bill Clinton, for whom Bowles served as chief of staff. Clinton’s office provided me with the following statement when I called for comment. It’s a damning retort to Krugman — and a bold statement about a plan the Obama administration has failed to embrace, even though the President commissioned it:

“While everyone can find things to disagree with in the recommendations of the Simpson-Bowles commission, I believe it got some big things right: The debt will become a much bigger problem when normal economic growth returns and causes interest rates to rise; passing a credible 10-year plan now will keep the government’s borrowing costs much lower than they will be without one; it’s important not to impose austerity now before a growth trend is clearly established, because as the austerity policies in the eurozone and the U.S. show, that will slow the economy, cut jobs, and increase deficits; and any credible deficit-reduction plan requires three things — spending reductions, revenue increases, and economic growth.”

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Let me add a few numbers to give context to Clinton’s comments. America took in $2.45 trillion last year and spent $3.54 trillion, leaving us with a deficit of about $1.1 trillion. A nation with as much goodwill as ours can do that from time to time, but this marks the fourth year in a row we’ve spent over $1 trillion more than we took in. Just in that time, we’ve borrowed more than $17,000 for each man, woman, and child in the country.

The interest payments on all that debt are a potential tsunami of their own. We’re spending $258 billion a year on interest payments for our massive debt. That’s more than we spend on the departments of Commerce, Education, Interior, Energy, State, Homeland Security, and Justice combined. And the Congressional Budget Office projects that if we don’t tackle some of this debt, our interest payments will soar to $1 trillion a year just over a decade from now.

As for our entitlements, the situation is equally dire. As the law is currently written, the Social Security trust fund will run dry in 2033. If nothing changes before then, Social Security recipients will have their benefits cut by 25%. Simpson-Bowles tries to keep the program solvent by putting in modest steps to raise the retirement age gradually far into the future — by one year in 2050 and another in 2075 — so as not to change the social promises made to people who are nearing retirement age now. But the longer we wait to discuss the real problems in entitlement programs and enact changes like this, the more draconian the fix will need to be.

That’s why Krugman’s claim that there is no fiscal crisis isn’t just laughable, it’s downright dangerous. Krugman throws down the gauntlet when he calls Simpson-Bowles “a really bad plan.” As President Clinton notes, nearly every constituency will find some part of it hard to swallow. But the beauty of the plan is that it attempts to unify the country through shared sacrifice that is also grounded in some form of fiscal reality. And there’s nothing “really bad” about that.

This story is from the November 12, 2012 issue of Fortune.