Chicago, Ill. - Speaking at the opening session of the Clinton Global Initiative America conference on Wednesday, former President Bill Clinton called the national debt a "cancerous threat" that must be tackled.

However, he cautioned against cutting too much spending too soon, predicting that Britain's strategy of slashing government spending in the short term won't work, and suggested that current tax rates should be increased.

"We can't afford to spend 25 percent of GDP on government expenditures," he said. "I don't think we can afford to tax at only 15 percent of GDP either."

As he voiced support for tax increases, however, he issued a warning for Democrats.

"My party needs to be careful about over-exaggerating how low the taxes are," Clinton said.

The former president appeared on a panel at the conference with Mississippi Gov. Haley Barbour; Simonida Cvejic, founder and CEO of the Bay Area Medical Academy; Peter Peterson, founder and chairman of his eponymous foundation; Michael Thurmond, former Georgia labor commissioner; and Laura Tyson, who served as chair of the Council of Economic Advisers during the Clinton administration.

The two-day conference in Chicago is the first Clinton Global Initiative event devoted entirely to issues facing the United States. The opening plenary session focused on the nation's job situation at a time when unemployment sits at 9.1 percent and 13 million Americans are out of work.

Clinton opened the session by urging the panel to focus on the problem of misaligned skills among the workforce.

"One of the biggest challenges of the current moment is that posted job openings . . . are being filled only half as fast as they were filled in all previous recessions since World War II," he said.

Thurmond touted Georgia Works, a program he started as labor commissioner that paid employers to train prospective employees before hiring them.

Barbour highlighted his efforts in Mississippi to bring community colleges and employers together to help create a more skilled workforce and emphasized the importance of trade training.

"We have got to quit stigmatizing skills training and trades in the United States," he said.

Peterson, whose foundation focuses on increasing awareness of the fiscal challenges facing America, issued the most forceful warning on the panel about the national debt, warning that a crisis could take place "sooner than we think, as we've discovered in Europe." He urged the country to come together behind a long-term deficit reduction plan, arguing that it will help create jobs.

Clinton went on to highlight the "long-term structural feeders of the government debt," including entitlements and defense spending, calling Medicare "our toughest problem."

Barbour argued that politicians can win support for entitlement reform by being honest with the American people.

"People are smarter than politicians give them credit for," he said. "People are up to hearing the truth, and they will deal with the truth."

Though the panelists remained civil throughout and did not engage in any direct debate, a sharp ideological divide was on display between Barbour and Thurmond.

While the Mississippi governor pushed for a downsizing of government, arguing that "a bigger government means a smaller economy," Thurmond issued an impassioned defense of government, highlighting his roots as the son of a sharecropper and his rise through the public education system.

"Anybody who thinks that government does not have a role to play is just not real," he said.

Clinton opened the conference by praising Chicago and its new mayor, Rahm Emanuel, who worked for the former president as a senior adviser.

"I predict to you that his tenure as mayor of Chicago will be one of the most brilliant chapters in the city's long and storied history," Clinton said.