On February 18, 2010, the President signed an executive order (EO) to establish the "National Commission on Fiscal Responsibility and Reform," co-chaired by President Clinton's former White House Chief of Staff, Erskine Bowles, and former Senator Alan Simpson (R-WY). According to the White House, the commission "will build bipartisan consensus to put forth solutions to tackle our long-ignored fiscal challenges." However, the commission fails to take tax increases off the table and would not require a vote on the final recommendations by Congress until after the elections in November (or ever). In reality, the commission amounts to little more than a political gimmick, allowing Democrats to talk about fiscal responsibility while they continue to bury future generations with record spending, deficits, and debt.
The President's EO establishes the National Commission on Fiscal Responsibility and Reform with the expressed mission of "identifying policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run."
Membership: The commission would be comprised of 18 members who would be appointed by the President, the Majority and Minority leaders of the Senate, and the Speaker and Minority leader of the House. Under the EO, 12 members would be selected by Congress. Three Senators from each party would be appointed by their respective Senate Majority and Minority leaders. Likewise, three House of Representative members would be selected by the Speaker of the House and three by the Minority Leader. The final six members would be selected by the President. The President would be barred from selecting more than four members from the same political party, meaning the President would likely choose four Democrats and two Republicans. Under that scenario, the commission would be comprised of eight Republicans and 10 Democrats, but Democrats would have control of 12 appointments compared to the GOP's six. This means that Democrats would choose which Republicans are on the panel.
Mission: The commission would be charged with identifying and presenting policy recommendations "designed to balance the budget," including policies to cut deficits by increasing taxes and slowing the growth in entitlements. According to the White House, "primary balance" in the budget is defined as "achieving deficits of about 3 percent of GDP," as compared to the projected FY 2010 deficit of 10.6 percent of GDP. Over the next ten years, deficits will average 5 percent of GDP under the President's budget. Specifically, the EO requires the commission to propose "changes to address the growth of entitlement spending and the gap between the projected revenues and expenditures of the Federal Government."
Report: The commission would be required to vote to approve a report containing their final recommendations by December 1, 2010. The final report must be affirmatively voted on by 14 of the 18 members of the commission, meaning that at least four Republican members of the commission-presumably including the two appointed by President Obama-must vote for the recommendations. Following the issuance of the report, Congress would not be required to act upon the recommendations.
Issues of Concern
A Powerless Commission: The commission would be established by an executive order, rather than by a binding statute as other deficit-panel proposals have sought to do. A commission established by an executive order cannot compel Congress to act on its proposals. Democrat leadership may say that it would bring the commission's recommendations to the floor if they retain their Majority, but they could easily change their position or simply ignore the suggestions. Democrats could also choose to act on "bipartisan" recommendations which they support, like tax increases, and reject the spending cuts.
Taxes on the Table: Given the Democrats' track record of raising taxes, it has been widely speculated that the Obama commission could be used by Democrats to propose supposedly "bipartisan" tax increases. Democrats could use the "bipartisan" panel as a means to say that tax hikes are supported by Republicans. Many Members may believe that the current recession is the worst possible time for crushing tax hikes and that tax increases need to be explicitly taken off the table.
Politically Imbalanced: When introducing the commission, the President stated, "the Commission I'm establishing today will build a bipartisan consensus to put America on the path toward fiscal reform and responsibility." In actuality, the commission is politically imbalanced as Democrats control 20 percent more of the panel and two of the Republicans will be selected by the Democrat President.
Timing: The Commission would not be required to report its final recommendations for nearly a year, well after the federal government spends a record $3.72 trillion in FY 2010. Many Members believe that the nation's fiscal crisis must be faced immediately, not sometime down the road. In addition, the commission would likely conceal its recommendations from the American people until after the November elections. Some Members may be concerned that the panel is designed to hide its final proposals from the people until after they have voted.
A Lack of Credibility: Democrats would control a majority of the commission and ultimately decide what tax increases or spending changes to recommend. Unfortunately, since taking over Congress and the White House, Democrats have an atrocious record of increasing spending, deficits, and taxes. Since Democrats took control of Congress and started passing their budgets in 2007, the national debt has grown by 42.8 percent. In 2009 alone, House Democrats passed a "stimulus" bill-which the Congressional Budget Office (CBO) now predicts will cost $862 billion-a $1.3 trillion health care takeover that raises taxes by more than $700 billion, a $873 billion national energy tax on every American, two omnibus spending bills totaling more than $855 billion, and increased non-defense discretionary spending by 12 percent.
Facing political pressure, Democrats are desperate to feign interest in the rising deficits. As a result of its nonbinding nature, many Members may believe that this commission constitutes an empty political tactic to convince Americans that something is being done, without actually addressing difficult fiscal realities.