January 23rd, 2010
09:21 PM ET
8 years ago

Under pressure, Obama backs fiscal commission

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In a dramatic concession to senior Democratic and Republican lawmakers, President Obama abruptly shifted his position Saturday and declared his public support for creating a fiscal commission.

In a dramatic concession to senior Democratic and Republican lawmakers, President Obama abruptly shifted his position Saturday and declared his public support for creating a fiscal commission.

Washington (CNN) - In a dramatic concession to senior Democratic and Republican lawmakers, President Obama abruptly shifted his position Saturday and declared his public support for creating a fiscal commission that could propose sweeping tax increases and spending cuts to try to slash the soaring federal debt.

The White House released an unexpected written statement from Obama saying he now backs putting together a powerful commission created through a federal statute, a reversal from earlier this week when Vice President Joe Biden signaled in a private meeting with Sen. Kent Conrad, D-N.Dakota, and other key lawmakers that the administration would only support a weaker version of the commission by forming it through an executive order.

"The only way to solve our long-term fiscal challenges is to solve it together – Democrats and Republicans," Obama said in the written statement. "That's why I strongly support legislation currently under consideration to create a bipartisan, fiscal commission to come up with a set of solutions to tackle our nation's fiscal challenges – and call on Senators from both parties to vote for the creation of a statutory, bipartisan fiscal commission."

Conrad applauded Obama's decision in a written statement.

"The president is demonstrating exactly the kind of leadership we need to tackle our nation's long-term fiscal challenges," Conrad said. "His support shows that he is determined to do what is necessary to put us back on a sound long-term course."

A senior Senate source familiar with Biden's meeting last week with Conrad and other key senators suggested the administration's reversal came because lawmakers were adamant that they would not support an increase in the debt ceiling unless the administration supported the full-scale statutory fiscal commission as called for in the Conrad-Gregg proposal.

An increase in the nation's debt ceiling is coming up for a vote in the Senate on Tuesday, and there has been fear that failing to lift the amount of money the U.S. can borrow might further rattle the financial markets.

Conrad and the other Senators insisted to Biden that Obama had to support enactment of the statutory commission if he wanted to pass the debt ceiling increase, according to the senior Senate source familiar with the discussions, and that creating the commission through an executive order was not credible. A second Senate aide added that the upcoming debt ceiling vote, coupled with pressure from Tuesday's special election in Massachusetts, helped tip the administration.

It's still unclear whether the legislation sponsored by Conrad and Sen. Judd Gregg, R-New Hampshire, will pass on Tuesday. The senior Democratic aide said Obama's support will help bring along Democrats, but it's uncertain whether the bill will get the 60 votes needed to overcome a possible filibuster.

The Conrad-Gregg legislation would create a commission with 10 Democrats (eight members of Congress and two Obama officials) and eight Republicans (all from the House and Senate). It would have several months in 2010 to study the problem and then vote after the midterm elections on a reform package that could include dramatic tax hikes and spending cuts. If 14 of the 18 members approve the package, giving it a bipartisan nod, it would force an automatic up-or-down vote in the House and Senate on whether to implement the recommendations.

Such recommendations could include cuts to popular programs like Social Security and Medicare, which is why some liberals are opposed to formation of the commission; or proposals to drastically raise taxes to make up for budget shortfalls, which is why some conservatives have blasted the idea.

CNN first reported in December that Obama was privately giving serious thought to setting up such a commission, and that there was division within the administration about whether to give the panel real teeth by creating it with a federal statute or give it less power by forming it through an executive order that would not require up-or-down votes in Congress on the potentially explosive recommendations.
While some critics charge a commission would be a cop-out because it would punt Congressional decisions to an outside panel, the Senators pushing the plan believe the current system is broken and it will take a new mechanism to enact the wrenching changes that will be needed to get the budget back into balance.

"Our statutory task force proposal provides the best chance for developing a truly bipartisan solution to this problem," Conrad said in his statement. "No one political party can solve this on its own. We need both sides of the aisle committed to working together to confront the threat of runaway debt."

But Obama hinted at the partisan divide such a commission would face in his statement, which began by blaming the current situation squarely on the Bush administration.

"The serious fiscal situation that our country faces reflects not only the severe economic downturn we inherited, but also years of failing to pay for new policies – including a new entitlement program and large tax cuts that mostly benefited the well-off and well-connected," Obama said. "The result was that the surpluses projected at the beginning of the last administration were transformed into trillions of dollars in deficits that threaten future job creation and economic growth."

Filed under: Congress • national debt • Popular Posts • President Obama
soundoff (123 Responses)
  1. Mark Bittner

    This guy is all over the board...

    January 23, 2010 11:06 pm at 11:06 pm |
  2. James Monroe, Wiggins, Mississippi

    This joker would throw his own grandmother under the bus and sacrifice every Democratic Congressman and Senator to save his own hide. He is the most pathetic excuse for a president we have ever had, and we have had a few pathetic ones. He has no idea whatever about what is actually going on. Thank God we will have him for only 3 more years. Without total control of Congress, we may be able to survive one tero of this farce.

    January 23, 2010 11:07 pm at 11:07 pm |
  3. lifelong democrat

    Somebody please put a DUCTAPE on Obama's mouth, every time he give his speeches and tvinterview, stockmarket goes down, the dollar DEVALUES!

    I would appreciate it very much if he'll shut up for AT LEAST 30 days.

    Once a liar, always a liar, whatever Obama say from here on out cannot be believed anymore. He lied too much, to the point his lies become his own truth, but remain a lie to us ordinary people.


    January 23, 2010 11:09 pm at 11:09 pm |
  4. valwayne

    A commission is an admission of malfeasance and negligence on the part of all of our national elected leaders. They tell us when they run for election that they'll make the hard decisions and work day and night. When they get there they hire a commission and pay them to do their job. So lets go with a commission and hope it doesn't give us the Louisiana Purchase and Cornhusker Kickback, but while the commission is doing the job our Congressman, Senators, and President are suppose to be doing we should suspend the pay of all Congressman, Senators, and the President. If we're going to pay someone else to do their job why should we pay them? Another failure of Obama, Pelosi, and Reid!! We need to get rid of all these people in Nov.!!!!!

    January 23, 2010 11:11 pm at 11:11 pm |
  5. Dale

    Cut all the waste he created?

    January 23, 2010 11:11 pm at 11:11 pm |
  6. Batnit

    Of course he's changing. Maybe he's listening now to the people. Obama is as stubborn as they come. I work at the website Storyburn and I see the pain across America over home foreclosures and record job losses and I have to wonder why we he doesn't listen to us when we say that this health bill will cause more firings not hirings

    January 23, 2010 11:14 pm at 11:14 pm |
  7. William

    Good! This is an important piece of legislation, and hopefully the commission can come up with more substantive recommendations than the usual spending cuts on the most efficient and underfunded programs in the Federal Government, like education and cancer and AIDS research.

    Also, it would be nice to be able to consider well-planned tax increases for the right things, in contrast to the current spend-but-don't-tax mentality in Washington. Of course, this will somehow be criticized by the president's opponents, but c'est la vie.

    January 23, 2010 11:14 pm at 11:14 pm |
  8. Andy from CA

    Just how bi-partisan and powerful remains to be seen. Do these public servants have the guts to make cuts and raise taxes without prejudice? I doubt it!!

    January 23, 2010 11:15 pm at 11:15 pm |
  9. Gyrogearloose

    The problem with abrupt changes in position is that they make you wonder how well thought out they are. I sure hope the president is thinking rather than just reacting to recent events.

    January 23, 2010 11:21 pm at 11:21 pm |
  10. Jeff of Peoria

    Now this is change u can believe in. Will anything come out of this – who knows. Not what Obama had in mind but he HAS to shift now.

    January 23, 2010 11:26 pm at 11:26 pm |
  11. Keith in Austin

    Hey Barry! For starters, why not repeal the unspent stimulous money vs. your proposed tax hikes on hard working Americans?

    Rather than waging your left-wing war on Corporations, you need to reconsider your socialistic inbreeding and realize that embracing capitalism is how you will create jobs and strengthen the economy!

    Every time Barry attacks the banking industry, punishes businesses with more strangling taxes and spends money we don't have, unemployment goes higher, the Stock Market tanks and he sucks the life out of our economy. Now he wants to raise the debt ceiling and pay for it by significant tax hikes on all of us!

    Progressive liberalism and Obarry's words pale in the light of his actions! He is a dishonest, narcicistic, radical that will stop at nothing to wage complete governmental control over all Amricans! This guy is Really Bad News!

    January 23, 2010 11:27 pm at 11:27 pm |
  12. Dan Frey

    What a joke. This has been so evident since day one, but did he run on it? As a person who is in the highest marginal bracket, I hope the rest of the nation will enjoy the higher taxes. BO is not a leader, rather, he is simply a follower. He is very weak and he is just what we thought he was. ONE TERM!

    January 23, 2010 11:28 pm at 11:28 pm |
  13. Tom C

    Republicans do not want compromise. They want their way or the highway. After all the posturing, next week they are going to come out with their new plan for health insurance. Where was it 6 months ago.

    January 23, 2010 11:29 pm at 11:29 pm |
  14. Marvin

    What? Obama supporting a commission that he does not directly control? Wow! That is a change! Maybe there is hope after all.

    January 23, 2010 11:33 pm at 11:33 pm |
  15. AJ

    As Obama frets about his Presidency he runs cowering to the center and cedes all authority to Republicans. Can we hear another "yes we can!" from all of his delusional supporters?

    January 23, 2010 11:35 pm at 11:35 pm |
  16. Nocona Texas

    Still blaming Bush. When is this Whiner in Chief going to
    step up to the mark and admit he doesn't know squat about
    running the business of our government? His deep background in
    community organizing has only brought us the likes of
    Rahm Emmanuel & Tim Geihtner(sp?)...what a group of losers!
    I am marking the days on my calendar until he is history.

    January 23, 2010 11:42 pm at 11:42 pm |
  17. patrick j

    Great job MR President!!!!!!!!!!

    January 23, 2010 11:45 pm at 11:45 pm |
  18. Mandemus

    Hey nice bait and switch. Not one single penny in new taxes Obama promised. So he spends us into bankruptcy in one short year and out come the taxes. Is there a single promise this guy is going to keep?

    Immediate withdraw from iraq.
    Immediate laser like focus on Afghanistan.
    Transparent government.
    Close the prison in Cuba.
    Bologna smugglers in the military.
    Health Care negotiations on Cspan.

    So with this sort of track record, what am I to make of your promise to tackle tort reform? Uh huh, I thought so. So much for Hopey-Change!

    But hey, all his failures are Bush's fault amirite? At least that's what the tele-prompter tells us.

    January 23, 2010 11:50 pm at 11:50 pm |
  19. Spider


    Way to stick to your guns Mr. President. Massive backbone.

    January 23, 2010 11:52 pm at 11:52 pm |
  20. IVOTE

    Well it looks like the teabaggers and friends are going to get their social security and medicare cuts in service they have campaigned for. I doubt very much the republican fat cats are going to stand for a "dramatic " tax hike.

    January 23, 2010 11:54 pm at 11:54 pm |
  21. J.C. - Independent 4 Public Option

    Medicare should be cut to keep it from going bankrupt.
    How? Stop fees for services to keep our seniors under better care at lower costs.

    Wall Street Journal recently reported that Johnson & Johnson paid tens of millions of dollars in kickbacks to Omnicare Pharmacy so nursing homes would put more patients on its blockbuster schizophrenia medicine and other drugs. Our seniors in nursing homes are unnecessarily drugged and J & J is getting richer. Medicare and Medicaid are going broke.

    How can Omnicare Pharmacy manage to cover half of all the beds in nation's nursing homes? Where is anti-trust when we need it? We all grow old some day. Let's protect our seniors.

    January 23, 2010 11:54 pm at 11:54 pm |
  22. Jeff

    Quite coincidental that Obama now has the votes needed to confirm Bernake.

    January 23, 2010 11:55 pm at 11:55 pm |
  23. jamyers291

    what did Axelrod tell Obama to do now?
    Axelrod is the president and Obama is his spokesman
    and chief teleprompter reader.

    January 23, 2010 11:56 pm at 11:56 pm |
  24. Snoopy

    Does this mean Obama wants to put the interest of the American people first or does he just want to be partisan? Will the GOP say this decision makes Obama a terrible president? Do the Dems see this as giving in to Repubs?

    So much BS going on in DC that both parties truly suck, while we continue to bankrupt the country with our current system of Healthcare. Why arent other countries with national healthcare falling off the face of the earth?

    The deficit is high and continues to go up with the borrowing, but did we just start borrowing in 2009? If these idiots free losing their 'gravy train' in Nov, why would they do anything to help me?

    January 23, 2010 11:58 pm at 11:58 pm |
  25. George Guadiane - Austerlitz, NY

    Republicans will say "Democrats want to tax the rich to get us out of this fiscal mess. If we don't get tax breaks, we won't make jobs." Meanwhile, by every measure, compared to middle and lower income citizens, the rich just "keep on getting richer." By the way, it was the Corporatocracy that got us into this fiscal mess in the first place, INCLUDING home loans repackaged and sold as derivatives.
    Democrats will say "Republicans want more, bigger tax cuts and less government oversight. They say that they want a free market. Well, as this crisis shows, they want a free market till the check comes due." SPINELESS Democrats, in my opinion have it more right... The problem is, Democrats don't know how to sell the truth an Republicans have been selling "Capitalism" for generations.


    January 24, 2010 12:01 am at 12:01 am |
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