New Bipartisan Commission Would be Charged with Reducing Deficits, Debt
Congress again escaped a partial government shutdown last week by the skin of its teeth, giving itself more time to pass logjammed appropriations. On a separate but related track, the House Budget Committee voted to create a bipartisan fiscal commission to figure out a more stable way to handle federal spending and national debt.
The latest stopgap funding measure, which started with bipartisan negotiation in the Senate, easily passed the House with Democratic support despite opposition from conservative Republicans. Unlike a previous stopgap funding compromise, this one didn’t spark an effort to oust Speaker Mike Johnson.
In an optimistic and ironic twist, Johnson wants to attach the fiscal commission bill to the last of 12 pending appropriations bills. Johnson faces a political challenge to get all those stalled appropriations to the House floor and passed that contain culture war provisions and significant spending cuts. With two recent GOP resignations, including by former Speaker Kevin McCarthy, House Republicans now have a narrower majority.
The fiscal commission would have 16 members evenly divided between House and Senate members and Republicans and Democrats, and include four nonvoting members from outside Congress. The commission would be charged with writing a report and legislation to improve the long-term fiscal condition of the government, reduce deficits and debt, achieve a sustainable ratio of debt to gross domestic product by fiscal 2039 and improve the solvency of federal trust funds, including Social Security and Medicare.
The track record for similar previous commissions is not encouraging.
An Earlier Bipartisan Commission
This new effort is reminiscent of the 18-member National Commission on Fiscal Responsibility and Reform created by President Obama in 2010 charged with identifying “policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run”. It was known as the Bowles-Simpson Commission. Erskine Bowles, then president of the University of North Carolina with ties to the Clinton administration, and former Wyoming Senator Alan Simpson.
The commission’s controversial recommendations included across-the-board spending cuts, tax cuts, an increase in the Social Security retirement age and reduced interest payments to reduce the national deficit by $4 trillion. The original idea for the commission sprung from bipartisan congressional legislation. True to form, there was bipartisan support on the commission for its final report as well as bipartisan opposition.
Oregon Senator Ron Wyden expressed support for the commission’s recommendations, as did New York Mayor Michael Bloomberg. Wyden, who now chairs the Senate Finance Committee, ripped the new commission as a “backdoor scheme” to cut Social Security. Economist Paul Krugman vigorously opposed large cuts in income tax rates. Union officials opposed cuts in Social Security. Republican House Speaker Paul Ryan, a member of the commission, opposed recommended gas tax increases. House Democratic Leader Nancy Pelosi initially opposed the recommendations, but later supported them.
While the commission’s report wasn’t approved, it continues to be a reference point for current-day conversations for fiscal responsibility. One element of the recommendations id become law in the Budget Control Act of 2011.
“To suggest that the Greenspan Commission provides a model for
resolving questions would be laughable if it were not so dangerous.”
An Even Earlier Commission
In 1981, President Reagan established by executive order the National Commission on Social Security Reform, which became better known as the Greenspan Commission, named after Alan Greenspan, who chaired the commission and later chaired the Federal Reserve for 19 years. The bipartisan commission consisted of 15 members, with five each selected by the President, Senate and House. Seven congressional members served on the commission.
A year after its creation, the commission had failed to reach a consensus on Social Security reforms. A small group of commission members then met privately and identified partial solutions that were forwarded to Congress. The final report became the basis for the Social Security Amendments of 1983.
Robert Ball, a former commissioner of Social Security who sat on the commission as Speaker Tip O’Neill’s nominee, wrote a book about the commission with this summation:
“Nothing should obscure the fact that the National Commission on Social Security Reform was not an example of a successful commission. The commission itself stalled after reaching agreement on the size of the problem that needed to be addressed. As a commission, that was as far as it got. To suggest that the Greenspan Commission provides a model for resolving questions would be laughable if it were not so dangerous.”
Some members of Congress have urged a new fiscal commission based on the Greenspan Commission model.
The Latest Fiscal Commission
Despite concerns that the newly proposed fiscal commission will be a vehicle to make cuts to Social Security and Medicare, three Budget Committee Democrats, including Oregon Congressman Earl Blumenauer, voted to advance the idea to the House floor.
Blumenauer, who is retiring, said it’s possible a commission can do some good. But he added, “It’s no substitute for Congress not doing its job.” The Century Foundation, a progressive independent think tank echoed his thought. “Fiscal commissions have, since the 1980s, been a way for Congress and presidential administrations to outsource discussing and solving the most difficult political problems to a process that avoids democratic debate and legislative safeguards.”
If passed into law, the commission would have until December 12, 2024 to issue its report, which would mean any action called for wouldn’t be considered until a new Congress and possibly a new President is seated next year.
Pennsylvania Congressman Brendan F. Boyle the ranking Republican member on the committee, said no commission can substitute for congressional action. ”At the end of the day, regardless of process, it comes down to lawmakers making a decision on raising revenue, cutting spending or a combination of both.” He said Social Security and Medicare trust funds need more revenue.
Texas Democratic Congressman Lloyd Doggett predicted the commission, if actually approved, would earn the nickname of the “Cut Social Security Commission”.
In addition to the commission vote, the Budget Committee approved two other measures. One would require a debt-to-GDP ratio be included in presidential submissions and congressional resolutions on the annual budget. The other would require a joint meeting of Congress to hear a report from the Comptroller General on the fiscal condition of the government.