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Why form a debt commission? Obama's budget skirts asked-for advice

On February 18, 2010, President Obama signed an executive order creating the National Commission on Fiscal Responsibility and Reform. Almost a year later, in the 2012 budget issued Monday, many of the major proposals made by the 18-member "debt commission" were not included.

Limiting those cherished mortgage interest tax breaks? Not on the table. Raising the social security eligibility age? Not part of the plan. Charging wealthy seniors more for Medicare? Not in the budget, either. The major pieces of the debt commission's plan were not endorsed in the budget. Which raises the question: Why bother forming it?

White House budget director Jacob Lew defended the administration's incorporation of "many, many ideas" by the commission on CNN on Sunday. These include proposals to limit malpractice lawsuit awards, revamp the corporate tax code and freeze salaries for federal employees, he said. But the most substantial--and therefore, controversial--proposals, which would help to trim federal shortfalls by $4 trillion over a decade, versus the budget's $1.1 trillion, were not part of the plan announced Monday.

Lew may have been right when he told Bloomberg Television that if there's not a bipartisan discussion in place, "big, bold proposals" won't be able to move forward. The smaller and less controversial cuts proposed by Obama might be a first step toward reducing the deficit, and they're better than nothing--which might have been all we'd get if the proposals were so bold that they brought discussions to a screeching halt. After all, some of the proposals (limiting the mortgage interest tax deduction, for instance) are such political dynamite that they could effectively end negotiations on more possible cuts.

But even if that's the case, one has to wonder why the president would establish a panel of experts and seek their recommendations if their biggest proposals are to be ignored. At the very least, the president could offer a more complete explanation about why some of the commission's major proposals were not endorsed. Even better would have been to offer alternative ways to address some of the big spending areas--Social Security and Medicare, for instance--with equally big results.

Calling in outside luminaries and widening an organization's brain trust is part of any leader's arsenal of tools for brainstorming, change management and strategic planning. But to be taken seriously, their most substantial ideas must be implemented, addressed or challenged by offering an alternative. Otherwise, their credibility can be lost.

Related content:
Obama and Boehner's Lilliputian budget cuts

By Jena McGregor

 |  February 14, 2011; 10:13 AM ET |  Category:  Bad leadership , Economic crisis , Government leadership , Presidential leadership Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
Previous: The weight of Panetta's words | Next: Little excuse for the thin U.S. leadership bench in Afghanistan

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FWPerkins:

The debt burden "costs the average American about $6.00 per day."

So for my family of 5, that is $30/day, $210/week, or $10,470/year. Just on debt. That is not peanuts. I get nothing for that $$.

Posted by: jpfred | February 16, 2011 4:58 PM

Yesterday in a Post discussion I got Marc Goldwein to agree with me that the real unstated budget issue is income redistribution. Here is the the interchange:


"Q.
HOW PROGRESSIVE IS THE ENTIRE TAX SYSTEM?
Mr Goldwein, It appears to me that the basic unstated conflict about the deficit regards how progressive our entire tax system (State, Fed, SS, Medicare, sales, etc.) really is. When all are totaled up it has become increasingly regressive, something you seem to be aware of as you slithered out of a previous commentators point about taxes for the wealthy being the lowest in 60 years Is this not the battle... the wealthy want more and the only place it can come from if from the middle class and the poor?
– February 14, 2011 1:07 PM Permalink
A.
MARC GOLDWEIN :
You are right that distribution matter, but I don't think it's that hard to reduce the deficit AND make the budget and tax code more progressive.

The Fiscal Commission recommendations -- which had the support of some very conservative Republicans and some very liberal Democrats -- did just that. We made the Social Security program far more progressive by slowing benefits for high earners and creating a "minimum benefit"."

End of Interchange


Until we agree on how income is to be distributed, we will continue to have budget stalemate after budget stalemate. I suspect if we look at ALL taxes and ALL tax expenditures and agree on objectives relative to income distribution we may start to get somewhere. For the moment, the wealthy are getting wealthier because the non-wealthy have been snookered into Republican support via social issues.


Posted by: billsecure | February 15, 2011 11:20 AM

The point was to cover Obama's backside but then he just couldn't bring himself to exercise the courage and leadership necessary to take such bold actions. His solution . . . make more debt.

Posted by: rplat | February 15, 2011 8:55 AM

Jena asked:"What was the debt commission's point?"
----------------------------------------
Well, Jena since you are quite bright enough I'll tell ya. It was as many of us said when Obie 1st made the announcement. Obie banks on this axiom: You can fool a lot of the people all the time.

Now you know what camp you are in as you got taken by him, again.

Posted by: illogicbuster | February 15, 2011 8:40 AM

A little reality, if I may. This 'crushing debt burden' costs the average American about $6.00 per day. Add in the rest of the federal budget and you get a per capita daily cost of about $20.00. That's it. I can think of a lot of things I do, such as posting a note to you based on rules and technical developments paid for by said government, that are worth lots more than the $20.00 I pay each day.

It would be great if reporters and columnists reported with at least an attempt at depth some context for the hyperbolic rants of the professional politicians. If cost vs. benefit were to assume its proper place in economic discussions, people might be less inclined towards the dystopian illusions of the reactionary elite.

Posted by: FWPerkins | February 15, 2011 7:59 AM

The fact that the Commission members themselves couldn't agree is a pretty good measure of the difficulty of the process: nobody is going to make any headway without cutting all federal programs, not just the 15% targeted by the GOP and the proposed Administration budget, and without an honest effort to reform and potentially even raise taxes.

Some GOP Commission members were so scandalized at the very idea of a raise in taxes that they apparently wouldn't even talk to the majority. And the current House GOP proposal would, among other things, deeply slash prenatal health care and eliminate the federal grant to DC Metro. These reflect a distressing unwillingness to meet the responsibilities of a government.

Obama has also avoided the responsible approach, by avoiding the sacred 85% of the budget and dipping only one tiny toe into the idea of raising taxes -- and that, only a small increase on the wealthiest among us, folks who have somehow acquired an exploding share of the whole country's worth in the last 20 years.

Not that I can really blame him: the GOP's track record these past two years gives ample assurance that if Obama actually tried to address the tax code and the holy 85% of the budget, they'd not only fail to meet him halfway, they'd turn the whole exercise into a soundbite and run against him on it for the next two years.

When do you suppose a grownup is going enter into the discussion on the Hill?

Posted by: thmas | February 15, 2011 12:23 AM

Alan Simpson today backtracked a little on Parker-Spitzer calling for more taxes on everyone rich and poor.

Posted by: jameschirico | February 14, 2011 10:35 PM

The point was to privatize Social Security.

Posted by: knjincvc | February 14, 2011 6:50 PM

That should have been daring the coffers.

Posted by: Philly33 | February 14, 2011 5:41 PM

Until we realize that those who have never done anything shouldn't get anything we are screwed. We will be quite willing to cheat the retired military and veterans out of what was promised to them in order to give to the illegal aliens and others who are daring the coffers without ever having made a deposit.

Posted by: Philly33 | February 14, 2011 5:41 PM

The Catfood Commission came out with 3 basic premise, designed to enrich the plutocracy and impoverish the middle class.

1) Lower tax rates for the rich
2) End middle class tax breaks like 401k and home mortgage
3) Slash all public services, especially to the poor.

Any system designed to rob from the poor and give to the rich while pushing the middle class out of existence is doomed to fail. Even if it succeeds, it's going to create so much unrest that it would be better off failing. Social Security will not be cut because the public has stated it prefers tax hikes to entitlement cuts.

This plan goes against the best interests of 90% of voters, so it should have never been offered in the first place. It requires no sacrifices from Baby Boomers because all its entitlement cuts goes to their children. It raises the deficits until 2020, and then imagines a Congress and President willing to abide by their plan and defy 2020 voters.

The way to balance the budget is to phase out the Bush Tax Cuts, lift the cap on FICA, lower FICA to 4%, cut DoD down to size so that it doesn't out gun the entire world combined, and phase out corporate subsidies, especially Big Oil and Big Ag.

Posted by: AxelDC | February 14, 2011 5:04 PM

The Debt Commission was put in place in order to give the impression to the public that elected officials would take their advice and at least seriously discuss it.
This is typical of all illusionists and stage magicians....distract the audience from the reality and focus on the illusion.
The people in power, Republican ,Democrat, Independent, Socialist, Libertarian, etc are only interested in promoting THEIR specific agenda based on what THEY believe to be reality and what is in THEIR best interest. American business is intently focused on profits and gains ill gotten or legitimate. The plutocracy of elites say : To hell with the rest of the country , the environment and the people in it. These "leaders" have no real regard for the remaining citizenry, Constitutional founding principles or ethics or morality.

Posted by: wek41 | February 14, 2011 4:37 PM

Panel of experts? There was one economist and she is a ding bat. The "intellectuals of the Republican party were Simpson,Coburn,and Ryan. For the Dems Bowles (RINO), Baucaus (the man from La Mancha, Montana), and Conrad. Not exactly MENSA like material if you combined their minds. The report reflected a lack of imagination and thoughtfullness consistent with the authors.

Posted by: sauerkraut | February 14, 2011 4:35 PM

And GreenJeans; the real, real fiscal problem besides political stupidity and greed is the military! It ain't doing us any good! It wastes lives, treasure, environment, everything and keeps on taking, and taking, and taking, and taking.....

Posted by: CHAOTICIAN101 | February 14, 2011 4:20 PM

Like everything in Washington; only face time and money matter! That's it, That's all, power is the only aphrodisiac, money the only vote that counts!

Posted by: CHAOTICIAN101 | February 14, 2011 4:17 PM

Here's an explanation: McGregor studiously omits mentioning that the Commission failed to reach a consensus. The panel made no recommendations.

As for the "bipartisanshp" charade, the Republicans have no interest in problem solving or consensus. They just want power. Committing to hard choices can be unpopular. That's why they've put forth no credible economic plan.

The biggest piece of the fiscal problem is healthcare costs. The Affordable Care Act didn't go nearly far enough to help alleviate this problem.

That's the real-time takeaway here.

Posted by: greenjeans1 | February 14, 2011 3:39 PM

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