Obama to Create Panel to Study Deficit

• IggyPride00

  

  http://www.nytimes.com/2010/01/20/us/politics/20commission.html
  
  I saw this article yesterday and was happy to see they are finally getting the ball rolling with it.
  
  Konrad and Gregg had proposed making something like this a law, but (here's a shocker) there aren't apparently enough votes in the Senate to pass such a bill.
  
  The fallback is Obama will create it by executive order.
  

  The deal calls for an 18-member panel, with a dozen members named by Congressional leaders and six by the president, several Democrats said. The presidential appointees could be administration officials or outside experts, but it remained unclear whether all 12 Congressional appointees would be incumbent lawmakers or if some outsiders might be included.
  
  For the commission’s recommendations to go to Congress for a vote, 14 of its 18 members would have to agree to them.

  Also of interest:
  

  Besides the budget commission, the deal anticipates that Congress will approve an increase this week in the nation’s debt limit, now at $12.4 trillion, so the government can continue borrowing through this year to cover its operations.
  
  Also, the Senate will agree to vote, and probably pass, a House bill that writes into law a pay-as-you-go requirement. It would mandate that new spending and tax cuts be offset by spending cuts or tax increases to avoid adding to deficits.

  The commission idea has been used before to with hot button issues as a way of trying to diffuse issues that need to be dealt with but partisianship just does not allow for.
  
  Realistically anyone who is being serious and realistic about our fiscal situation understands it is going to take a combination of large (politically unpopular) spending cuts on entitlement programs, defense, and else where as well as an increase in taxes if we are seriously going to balance the budget.
  
  If a blue ribbon 9/11 style panel like this that would be bi-partisan agrees to a package that economically is the right course of action it might make it politically more palatable to vote for that if it came from Boehner or Pelosi where the political attacks would be out before the ink dried on the proposal.
  
  Does anyone else agree that ultimately a framework like this is the best path to take in terms of finally broaching the issue of getting the deficit under control?
  
  Also, let's keep our fingers crossed that pay-go finally becomes binding law because it would be another step toward fiscal sanity. Letting it expire in 2002 was ultimately a bad decision, so lets hope if it does pass (and again it may be lacking votes necessary to pass) it doesn't expire a few years later like last time.
• fish82

  

  In theory, I have no problem with this approach...albeit "commissions" created to "study" an issue rarely hold much appeal for me.
  
  A commission isn't needed anyway. It's a common sense solution that you've already nailed several times. Cut spending across the board...nothing is off the table.
  
  Once the economy starts to improve, if the increased tax revenue from that isn't enough to finish the job, then look at tax increases. For everybody.
• CenterBHSFan

  

  ^^^ Makes sense to me.
• BCBulldog

  

  I nominate Dave Ramsey to be the lead member of this panel.
• nmeccc

  Stop spending! Including more money for a panel. There is nothing to study! If you spend money, especially trillions of dollors, that you don't have, then you are in trouble! Pretty simple!
• queencitybuckeye

  The "whats" can be debated, but the "how" really isn't all that complex. Money out <= money in. What a concept.
• FatHobbit

  

  queencitybuckeye wrote: The "whats" can be debated, but the "how" really isn't all that complex. Money out <= money in. What a concept.

  You should be on the panel.
• majorspark

  

  queencitybuckeye wrote: The "whats" can be debated, but the "how" really isn't all that complex. Money out <= money in. What a concept.

  And as nmecc pointed out we will be more than likely paying these wizards of smart hundreds of thousands of dollars to do their "study".
• RedRider1

  

  ^^and then state the obvious.
  
  I 2nd Dave Ramsey being the head of the panel.
• Writerbuckeye

  

  So not necessary.
  
  This is just one more way to try and slip some of the responsibility off to somebody else.
  
  You're the damn president. You know what has to be done to stop deficit spending -- it's just a matter of having the balls to make the call.
• nmeccc

  Let me guess...The panel will find that the deficit is GW's fault and Obama is on the right track to fixing it. What are the Vegas odds on that one?
• redstreak one

  

  ^^^^^^Wouldnt touch it with a ten foot pole! lol
• tk421

  

  Total waste of money. Why would anyone create a panel that is going to add to the deficit to "study" the deficit. Typical political thinking, there is no common sense. This is so stupid, just cut spending.
• believer

  

  Let me try to understand this....BHO thinks it's time to create a panel to "study" the federal deficit.
  
  Isn't this like a professional bank robber asking fellow thieves to determine if stealing should be against the law?
  
  In all seriousness this is a complete political ploy and a total waste of time...and, ironically, taxpayer money.
• IggyPride00

  

  Total waste of money. Why would anyone create a panel that is going to add to the deficit to "study" the deficit. Typical political thinking, there is no common sense. This is so stupid, just cut spending.

  They're going to make a legislative proposal with the goal being Congress votes on it.
  
  Gregg and Konrad's bill would call for a mandatory up or down proposal on the panel's recommendation.
  
  To anyone poo-pooing this, this is exactly the framework Reagan used in the 80's when he used the Greenspan Commission panel to develop a plan to save social security because Congressional members would never take the heat for cutting benefits or raising taxes on their own. In the framework of acting on the panel's recommendations though they actually got something done.
  
  The President appoints 6 people (4 democrats 2 republicans), and Congress Republicans and Democrats appoints 6 members each.
  
  To have a recommendation from the committee that would be subject to a Congressional vote, 14 of 18 panel members would be required to endorse it. As you can see by the make-up, it would require bipartisanship in the final product.
  
  Everyone can agree we need to make major budget cuts. This is the only way to do it because it would eliminate the ability for either side to demagogue and use cutting entitlement benefits as a political weapon.
  
  Let's say hypothetically tomorrow Democrats proposed a bill that would massively cut S.S and Medicare benefits that realistically put us on the path to a balanced budget.
  
  Sure as the sun comes up Republicans would vote in unison against it and mobilize the entire 2010 campaign against them for leaving seniors on the streets and wanting them to die by taking their healthcare away. Even though they deep down would most likely love the cuts, it is just too tempting of a political football as it would be easy to get them all thrown out of office behind a faux populist don't let them do it campaign.
  
  Now you can just apply the scenario I described above to how Democrats would respond if Republicans did the exact same thing.
  
  That is why it is vital to ultimatley get an independent 3rd party to basically make the hard decisions for them. Reagan realized we needed to reform Social Security, but with a split Congress they would never have the political will to do it. So by taking the process out of their hands, it took heat off the members who ultimately voted to implement the final recommendations which weren't terribly politically popular.
• believer

  

  ^^^If it sounds too good to be true it usually is.
• tk421

  

  believer wrote: ^^^If it sounds too good to be true it usually is.

  I agree. I doubt 100% that anyone is going to cut anything in the budget. This is just a political ploy so that Obama and the Dems can say they did something about the deficit.
• IggyPride00

  

  I agree. I doubt 100% that anyone is going to cut anything in the budget. This is just a political ploy so that Obama and the Dems can say they did something about the deficit.

  Was it a ploy when Reagan did it in the 80's because it was clear that S.S needed saving?
• Footwedge

  The main reason for the national debt is the expansion of the welfare and warfare states. This is done in an effort to keep the masses employed.
  
  I would much rather have a committee roundtable why the number of jobs from the private sector are dwindling. If private industry booms, then the national debt gets reduced.
• Footwedge

  IggyPride00 wrote:

  I agree. I doubt 100% that anyone is going to cut anything in the budget. This is just a political ploy so that Obama and the Dems can say they did something about the deficit.

  Was it a ploy when Reagan did it in the 80's because it was clear that S.S needed saving?

  Unfortunately, the resolution to the SS crisis was to increase payroll taxes.
  
  My guess is that the comittee will come to the same conclusion. At this juncture, raising taxes is just as unfeasable as letting the runaway debt continue.
• tk421

  

  IggyPride00 wrote:

  I agree. I doubt 100% that anyone is going to cut anything in the budget. This is just a political ploy so that Obama and the Dems can say they did something about the deficit.

  Was it a ploy when Reagan did it in the 80's because it was clear that S.S needed saving?

  I have no idea, I was less than 5 during the 80s. You can't seriously believe that Obama and the Democrats are going to cut the SS/Medicare/Medicaid budget or the Defense budget. That is what needs to be cut, it's not going to happen though.
• gut

  Footwedge wrote: The main reason for the national debt is the expansion of the welfare and warfare states. This is done in an effort to keep the masses employed.
  
  I would much rather have a committee roundtable why the number of jobs from the private sector are dwindling. If private industry booms, then the national debt gets reduced.

  Precisely. And I predict Obama will do exactly what Clinton did, which is largely to leave office with defense and entitlements cuts TARGETED to bring in a balanced budget in the near future. Cuts that will be politically untenable for the incoming President to maintain.
  
  Because what is going to happen, simply, is if Obama cuts entitlements, people will campaign to restore those cuts, and people tend to vote almost completely on their own self-interest (with little forethought to the concept of being better off with a smaller piece of a larger pie).
• IggyPride00

  

  You can't seriously believe that Obama and the Democrats are going to cut the SS/Medicare/Medicaid budget or the Defense budget. That is what needs to be cut, it's not going to happen though.

  They're not going to have a choice, 30 years of runaway spending is bringing home the day of reckoning sooner than later.
  
  Don't kid yourself that the Republicans don't know its not coming as well. In November they are going to run on tax cuts, but the message is going to fall apart when they have to explain how decreasing revenue at a time of huge deficits without offering any specifics as to what type of spending they will cut is a re-run of Reagan and Bush and is not going to fly in this environment.
  
  Both parties know the budget has to be cut, but it hasn't happened because neither will take the political hit of being the party that writes the bill and takes ownership of it as they know how badly the opposition party will demagogue the issue even if it is the responsible thing to do.
  
  That is why it is going to have to be a 3rd party that offers the budget solution because it is going to take a combination of unpopular spending cuts and tax hikes.
  
  The American people know this. If you got in way over your head with credit card debt and couldn't afford your bills, you would need to trim your other expenses and probably get a part-time job to increase your income.
  
  The key is that at some point someone needs to put that proposal on the table and have it properly explained. A blue ribbon panel of Republicans/Democrats that were seen as a credible entity by the public would at least make it politically viable for our politicians to make the sure to be tough choices that will get the budget under control.
• believer

  

  IggyPride00 wrote:The key is that at some point someone needs to put that proposal on the table and have it properly explained. A blue ribbon panel of Republicans/Democrats that were seen as a credible entity by the public would at least make it politically viable for our politicians to make the sure to be tough choices that will get the budget under control.

  Can't disagree but even if this happens or if a viable third party comes along and takes ownership of the draconian measures that would be necessary to right the ship, there are certain "entitlement" programs that will be hard to touch.
  
  For example, as a conservative I believe these things need to happen, but when I retire Social Security better damned well be there. I've been paying into the system for 38 years and counting. The way I see it, I AM entitled to it...it's my friggin money. I have a hunch there are millions of other people out there who would agree with me.
  
  I didn't create Social Security nor do I necessarily agree with it, but I also - by law - didn't have any CHOICE but to participate. Drastic reductions in Social Security and Medicare for those of us who've been forced to pay into the system for decades would - shall we say - not be a pretty thing in many, many ways.
• gut

  I like the idea of privatization of SS. The real reason the govt doesn't want to do this is because that program has partly served as the banker buying it's treasuries to fund the deficit.
  
  If you privatized SS, this would be a boom for capital markets because much of that money would find its way into various investments. Of course, that type of risk runs counter to the idea of a "secure" social program. That sort of stimulus would ultimately be good for the economy, which could help offset some of the hits to entitlement programs. Balance the budget and you don't have major need to hit up the social security surplus for govt loans.