President Obama's new 18-member National Commission on Fiscal Responsibility and Reform held its first meeting on Tuesday, followed the next day by a conference on the nation's burgeoning budget deficit and debt problems, headlined by former President Clinton. President Obama has asked the bipartisan panel of 10 Democrats and eight Republicans to come up with recommendations for cutting hundreds of billions of dollars from deficits through 2015 and even more over the long term. If 14 of the 18 members agree on recommendations to present to Congress, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid have agreed to hold an up-or-down vote on them.
Even though many observers give the panel little chance at bridging the liberal-conservative divide to come up with major proposals, for budgeteers it's the only game in town in 2010.
Here are five questions facing the commission as it gets under way.
1. What's your ambition?
The panel's members must decide what they want to accomplish, and whether they want to think big or go small.
Republican Co-Chairman Alan Simpson, the former Wyoming senator and minority whip, said a first step could be simply reaching consensus on the scope of the problems facing the country -- the level of debt, the unfunded liabilities in Social Security and Medicare, the expected gap between revenue and spending. Another option is the Baucus approach: Senate Finance Chairman Max Baucus, D-Mont., suggested focusing on waste, fraud and abuse in the tax system, in spending programs and in government operations. The Conrad approach -- championed by Senate Budget Chairman Kent Conrad, D-N.D. -- would be to set aside Obama's 2015 goal and instead focus on long-term issues like entitlements and the out-year spending-revenue gap.
Robert Greenstein, head of the liberal Center on Budget and Policy Priorities, said at Wednesday's conference that simply informing the public of the scope of the problem would be a worthwhile goal -- rather than setting a big, unrealistic deficit reduction target. "One thing we don't need is a story line that we had another failure," Greenstein said. "Some broader education of the public of the nature of the choices would be helpful." Rep. Jeb Hensarling, R-Texas, a key conservative on the panel, said he's starting off with "high hopes and low expectations." Probably the right approach.
2. How do you tackle health care after health care reform?
The great unfinished business on health care reform is cost control. Neera Tanden, chief operating officer at the liberal Center for American Progress, said at Wednesday's conference that the recently passed health care reform legislation provided only a "framework" for dealing with the country's out-of-control health care costs. "All of that for a framework?" moderator Gwen Ifill joked.
But many budget experts agree that the biggest driver of spending increases in the government's long-term budget outlook is health care. "Let's just be concrete here: we're talking about a broken health care system," Dean Baker, economist and co-director of the Center for Economic and Policy Research, said on a conference call Tuesday organized by the liberal Campaign for America's Future.
House Ways and Means Committee ranking member Dave Camp, R-Mich., argued for re-opening some of the health care law's provisions. "[Congressional Budget Office] and Medicare actuaries have confirmed the health care law does not reduce health care costs. It increases them," Camp said at the commission's first meeting. Liberals don't agree with that, but everyone sick of talking about health care will have to face the fact that health care will be a budget issue long into the future.
3. When should deficit reduction kick in?
Many liberals are scoffing at Obama's 2015 deficit reduction goal, given that economists predict unemployment levels to remain above 8 percent for several years to come. The government needs to keep up fiscal stimulus -- and budget deficits -- until a recovery is fully under way, they argue. Conservatives counter that the fiscal stimulus employed by the Obama administration and the Democratic Congress hasn't worked, and that spending should be reduced as soon as possible. The conflict between the two sides could make the 2015 goal harder than the long-term goal, even though the long term involves bigger numbers.
4. How transparent will you be?
Conservatives like House Minority Leader John Boehner, R-Ohio, and liberals like House Judiciary Chairman John Conyers, D-Mich., have argued for all deliberations of the commission to be held in public. But Negotiations 101 argues for closed-door meetings where members can hash out agreements without the glare of the klieg lights encouraging them to posture for their bases. One problem is that now that we are squarely in the Internet age, there's a growing public expectation for public access and against back-room dealmaking. Groups opposed to recommendations the commission makes could paint their proposals as shady inside-Washington affairs. But no agreement may be possible with the cameras rolling on a group of politicians.
5. Is Alan Simpson crazy -- or crazy like a fox?
No one has been more quotable this week than Simpson. He's blasted conservatives for saying that taxes should be off the table and imitated senior citizens wary of Social Security and Medicare changes. And he's thrown around odd remarks like a modern-day James Traficant. But he's certainly drawing attention to the commission, which could have been a boring backwater of budget wonks. If the goal is ultimately getting the public to pay attention, then quips like this will certainly do the trick: "I was in that Senate for 18 years, and the cry to me was always, 'Al, go bring home the bacon.' Well, the pig has died. And the confectionery store window will close. And an evil witch with a boil on her nose will be servicing the candy counter."
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