National Commission on Fiscal Responsibility and Reform

In an effort to find ways to reduce the mounting federal debt, The National Commission on Fiscal Responsibility and Reform is a bipartisan panel created to in February. On Dec. 3, 2010, a plan put forward by the panel’s two chairmen won the support of 11 of its 18 members. The move fell short of the supermajority of 14 needed to send a proposal to Congress for a vote. The surprisingly strong showing, which caught even the panel’s members off guard, led supporters and opponents to say that it would like it to serve as a template for coming debates on long-term deficit reduction. President Obama instituted the commission by executive order after legislation to create a similar panel was defeated hard money lenders in the Senate by a group of Republicans who dropped their previous support for the bill. Mr. Obama told the commission members that “everything has to be on the table” as they think about options for reducing spending and increasing tax revenue. Nevertheless, the Democrats on the panel were obviously loath to consider reductions in Social Security as most of the Republicans were ill-disposed to tax increases. After the midterm elections in November, a draft plan was released by the chairmen Erskine Bowles, the president of the University of North Carolina system and a former White House chief of staff under President Bill Clinton, and Alan K. Simpson, a former Republican Senate leader from Wyoming. It demanded profound cuts in domestic and military spending beginning in microdermabrasion machines 2012. It would overhaul the tax code, taking out or reducing the $1 trillion a year in popular tax breaks for individuals and corporations and using the revenues mostly to slash income tax rates but also to reduce deficits. And to make Social Security solvent for 75 years, it would raise payroll taxes for the rich and reduce future benefits, including by gradually raising the retirement age for complete benefits to 69 from 67 by 2075. They said the plan would trim down deficit spending by about $4 trillion over the coming decade. The ideas were originally met with rampant opposition from video camera stabilizer both Republicans, who disapproved of its tax increases for upper-income Americans, and Democrats, who resisted the scale of proposed reductions in future health care and Social Security programs. After the chairmen made some changes to the proposal, it won the support of six of the 12 elected officials on the panel and five of the six private citizens. There are six Republican members of Congress, six Democratic members of Congress and six unelected commissioners on the panel. The Republican and Democratic leaders of the Senate Budget Committee, Judd Gregg and Kent Conrad, endorsed the package, as did the two other Senate Republicans on the panel. Senator Dick Durbin of Illinois, the number two Democrat in the Senate, voted in favor of the plan, emphasizing that he thought it needed changes but was a beneficial metal detector starting point for the debate. Perhaps more significantly, all three House Republicans—all of whom will hold important positions when Republicans control the chamber in the next Congress—went against it, saying it did not cut spending deeply enough and did not include a repeal of the Democratic health care law. Mr. Obama issued a statement in support of the committee’s findings without espousing any of its specific recommendations for spending cuts or tax increases. While tankless water heaters he said his direct goal is creating more jobs—an acknowledgement of the rise in the unemployment rate announced Friday morning and the political pressure that continual high levels of joblessness has put on him—he implied that he might use some components of the plan as the foundation for his own proposals to address the nation’s long-term fiscal imbalances. The proposals will create a test or an chance for Mr. Obama as he adjusts to the election thrashing that cost his party control of the House and reduced its Senate majority—depending on whether he tacks to the political center and embraces them in his own budget early next year, or shifts more to the left and leaves them on the shelf. The chairmen’s proposals will offer a challenge also to Congressional Republicans by challenging their disputation that the budget can be balanced by spending cuts alone—a claim that even many conservative economists and budget analysts reject, given the size of projected debt as the Baby Boom generation retires and claims federal benefits. The Bowles-Simpson plan is not the only one on offer. Another bipartisan panel, led by former Senator Pete V. Domenici of New Mexico, who was the senior Republican on the Senate Budget Committee for more than a quarter-century, and Alice M. Rivlin, who served both Congress and President Bill Clinton as budget director, weighed in with one that would reduce predicted deficits by nearly $5.9 trillion from 2012 through 2020. Their plan calls for a payroll tax holiday in 2011 to stimulate the economy, to be followed by deeper budget cuts.