WASHINGTON – For Mike Johnson, it was effectively a day one priority.
It’s past time, the newly elected House speaker said in October, to establish a bipartisan commission to deal with the federal government’s mounting $34.6 billion in debt. “The consequences if we do not act now are unbearable,” he said, echoing the warnings of his predecessor and other House Republicans.
More than six months later, the proposal appears all but dead, extinguished by vocal opposition from both the right and the left.
The collapse underscores an unshakable dynamic in Washington, with lawmakers in both parties reluctant to consider the unpopular tradeoffs that would be needed to stem the country’s rising tide of red ink — particularly in an election year. Faced with the reality that any tax commission would almost certainly suggest that Americans pay more or receive less from their government, lawmakers have repeatedly done what they do so well: throwing the problem to the next Congress. And they seem prepared to do it again.
Many Democrats and left-leaning advocacy groups oppose the commission because they fear it will recommend cuts to Social Security benefits. Some Republicans and right-wing groups are also against it, fearing the panel will recommend tax increases. They labeled the commission a “tax trap.”
“I’m disappointed we didn’t have as much momentum as I thought we would,” said Rep. Jodey Arrington, Republican chairman of the House Budget Committee. “The speaker supported it, endorsed it from the beginning. But I think there are some outside groups that have contributed, that have said this is a backdoor way to raise taxes, and that has scared some of my Republican colleagues.”
Sen. Joe Manchin, D-W.Va., sponsor of the Senate debt committee bill, was even more pessimistic.
“Nobody seems to care,” Manchin said. “It’s a shame, a debt of 34.6 billion dollars. Nobody cares about that.”
The debt commission legislation, modeled after previous efforts, would create a 16-member panel to recommend steps that could be taken to balance the federal budget as soon as possible and improve the long-term fiscal health of Medicare and Social Security . The commission would have 16 members – 12 from Congress, divided equally by party, and four external experts without voting power. The GOP-controlled House Budget Committee advanced the bill 22-12.
The fiscal realities that any commission would face are well documented and largely center on Social Security and Medicare, which consume an increasing share of the federal budget, and interest payments on the nation’s debt.
For Social Security, reserves in the Old-Age and Survivors Insurance Trust Fund will be exhausted in 2033. At that time, the program will have enough tax revenue to pay about 79% of scheduled benefits. For Medicare, the trust fund that covers hospital stays, hospice care, and skilled nursing facility stays has enough funds to pay all benefits through 2036. At that point, spending cuts of 11% would be needed to match the revenues received.
The last fiscal commission more than a decade ago – chaired by Erskine Bowles and Alan Simpson – recommended $4 billion in deficit reduction over a decade through a combination of tax increases and painful spending cuts. But the 11-7 vote in favor of the package was not enough to force Congress to consider it in 2010.
Supporters of a new debt panel noted that they based their law on something that has been successful in the past — commissions to consolidate the country’s military bases. The new commission would operate under a similar structure, with legislation requiring each chamber to quickly vote on its final proposal.
Still, Democratic lawmakers and the White House are skeptical about forming a debt commission. Shalanda Young, director of the White House Office of Management and Budget, told lawmakers at a recent hearing that the administration was concerned that the only thing on the committee’s table were cuts to Social Security benefits, and not asking Americans for high income that paid higher taxes.
“It will be supported by those who have paid into the system and depend on this program to retire in peace,” Young said.
More than 100 Democratic lawmakers also signed a letter opposing the commission in January, when powerful groups such as the AFL-CIO and AARP voiced their concerns.
When Republican-aligned groups also spoke out against the bill, including Americans for Tax Reform and the Club for Growth, prospects for moving forward diminished considerably. Their opposition has weakened the influence of Republican Party leadership by tying the commission to an annual spending bill or other mandatory measure.
“There is no guarantee about the result. I think that’s what scares the most people, and this city likes to know what the outcome will be,” said House bill author Rep. Bill Huizenga, R-Mich.
Grover Norquist, president of Americans for Tax Reform, said any mechanism that allows tax increases hurts former President Donald Trump and other Republicans running for office on a tax-cut platform. He said the focus should be strictly on spending reductions, and “tax increases are what politicians do instead of making difficult decisions and choices.”
“The modern Republican Party is not going to put tax increases on the table as if they are part of the solution to something,” Norquist said. “Tax increases don’t solve any problems.”
That approach also makes Democrats like Rep. Lloyd Doggett of Texas wary of a commission.
“We cannot solve our problems by cutting completely. It has to be with some additional income. Unless revenues are at stake, I’m no good. It has to be both,” Doggett said.
As bleak as things look for the bill now, Rep. Scott Peters, D-Calif., said passing legislation through Congress is often a long game. Getting a House committee to approve the commission was an important step, he said. “We are more advanced than ever.”
Supporters said they will continue to push for a commission to be approved by the end of this Congress. Manchin mentioned the possibility of attaching it to legislation in a lame-duck session after the election and before the new Congress takes office.
“We’re in that classic position where everyone hates us,” said Peters, one of three Democrats who voted for the bill in committee and is a co-sponsor. “We must be doing the right thing.”
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