Momentum builds for special commission to tackle $34T in US debt

Momentum is building in Washington for a special commission to tackle the nation’s nearly $34 trillion debt, but the idea is drawing mixed reviews from some lawmakers amid skepticism of its chances of success in a divided Congress.

Members across Congress have been pressing for a fiscal commission aimed at exploring ways to reduce the nation’s debt, particularly as Washington feuds over how the government should be funded for most of next year.

“The urgency to actually establish a commission to look at our spending and taxing has increased dramatically since Simpson-Bowles made an effort a decade ago,” Sen. Mitt Romney (R-Utah) told The Hill this week, referring to the Obama-era fiscal commission spearheaded by Alan Simpson and Erskine Bowles in 2010.  

“At that time, debt as a percentage of the GDP was about 60 percent. It’s up twice that now, and our interest bill is two or three times larger,” Romney said. “So, the urgency has grown, and a commission seems to be the only possible step that would make a difference.” 

Romney, who joined Sen. Joe Manchin (D-W.Va.) earlier this month in leading a push for a bicameral commission focused on reducing the debt, will testify along with the West Virginia Democrat before the House Budget Committee on the issue Wednesday. 

The bill is one of three bipartisan proposals the committee plans to review as part of the hearing, which will examine the need for a fiscal commission, particularly as some hard-line conservatives dial up the pressure on GOP leadership for the effort in recent months.  

Opposition to possible plan emerges

But not everyone is as hopeful about the push. 

Senate Finance Chair Ron Wyden (D-Ore.) called the potential lift “awfully far-fetched” in remarks this week and touched on some of the distrust among members that could pose a hurdle to the effort in the months ahead. 

“The history of these things is, you know, Republicans are big on the spending cuts, but then decide they want to let the billionaires get off the hook on revenue,” Wyden told The Hill.  

His comments come just weeks after House GOP leadership’s proposal targeting funding for the IRS drew criticism from fiscal experts who said it undercut the party’s agenda to reduce the national debt.

The measure sought to cut more than $14 billion in funding for the IRS to offset new aid for Israel.

But analysis showed pulling back investments for the revenue service could actually end up adding billions of dollars to the nation’s deficits. 

“You can’t responsibly reduce the deficit without having revenues be a central component of any type of plan,” said Joel Friedman, senior vice president for federal fiscal policy at the Center on Budget and Policy Priorities. 

“You really need some type of commitment, upfront and clear, that revenues will be part of this. Otherwise, you’re just setting it up for failure,” Friedman said Monday when pressed about proposals for a fiscal commission. “And then it’s sort of, you know, what’s the point of doing a commission if it’s just going to fail?” 

Public support for the idea may be solid

As the national debt continues to climb, some polling has indicated strong public support for the idea, regardless of party. 

A survey released by the Peter G. Peterson Foundation last month found that 9 in 10 voters supported a bipartisan fiscal commission, with 90 percent of Democrats and Republicans backing the push, along with 87 percent of independents.  

Research from the Pew Research Center also showed an uptick in Americans’ concern about the nation’s deficit earlier this year, as both major parties battled over how to raise the country’s debt ceiling and ward off what experts say could have been an unprecedented and catastrophic national default.

Congress narrowly avoided the threat after both sides agreed to a deal that would suspend the debt ceiling into 2025, along with new limits on annual government funding that Republicans pushed for.

But the high stakes fight also played a role in the U.S. seeing its credit rating downgraded by another top rating agency months later.

“These budget skirmishes and brinksmanship do not really solve the problem at all, and instead they bring us closer to various crises,” said Michael Peterson, chief executive officer at Peterson, while acknowledging the “current budget discussion has not been successful in terms of bringing out more serious long term fiscal solutions.” 

Peterson said a commission would provide a chance for members to come up “with the right mix of policy solutions that can garner support from both parties.” 

“Given the difficulty of these issues, both policy wise and politically, getting a smaller group into a structure that allows them to put everything on a table and have serious discussions over a significant period of time,” he said.

How would a special commission work?

Some lawmakers say the idea could allow for fiscal solutions beyond the annual government funding fights, including potential changes on the mandatory spending side, which covers funding for major programs such as Social Security and Medicare.  

However, there is disagreement among experts over how effective a commission could be, especially when compared to the Bowles-Simpson effort.

Discussing the push, Friedman argued that, despite the recommendations made on the revenues side at the time, “the only thing that really came out of commission that ended up being used were cuts on the spending side.” 

“The only thing that was enacted through the Budget Control Act that was nominally related to the Bowles-Simpson things were these caps on discretionary spending,” he said, adding that those caps “were further lowered and ended up causing — even though some of it was given back over the years — ended up imposing some real damage on the discretionary side of the budget.” 

While Friedman said commissions can put ideas on the table, on whether an agreement put forward by a commission could survive an up or down vote in this Congress, he added, “I don’t see it.”