January 23rd, 2010
09:21 PM ET
5 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. Sandra Bishop

    Has our esteemed president lost sight of the fact that he has ADDED to our debt. Perhaps he should take a pay cut and begin paying into Social Security and stop spending on new china and draperies, etc.

    January 24, 2010 12:04 am at 12:04 am |
  2. Texas Logic

    He said the "Obama's support shows that he is determined to do what is necessary to put us back on a sound long-term course."

    That is NOT what is shows. It shows that it takes him and his party gettin hit over the head with a club (Brown winning the Senate) for him to start thinking about what might actually be good for the country as a whole and not just what's on his little agenda that he hopes to one day be famous for.

    He doesn't care about anyone but himself and his party.

    January 24, 2010 12:09 am at 12:09 am |
  3. mollyd

    Who is Obama going to appoint to this commission? Thieving Wall Street Bankers who are the cause of our current situation, the same ones who continue to to reap the benefits (bonuses) of the most corrupt system in the world?

    Obama is in bed with so many lobbyists. He's the same as all the rest of the politicians. Corrupt and easily bought.

    January 24, 2010 12:11 am at 12:11 am |
  4. MatthewDetroit

    What Crap....

    A Fiscal commission... a group of the idiots spending all the money are going to tell us how they spend all the money.

    Instead of a commission there CHAVEZ..... Why dont you just STOP spending money. Barack is such a liar. In one voice he states how he wants to lower then debt... in his other voice he has spent 1.5 trillion OVER budget added to the national debt in only 1 Year.

    RECORD SPENDING. 3 TIMES more then any other president.

    He is a socialist and he is a spender.
    He is a thief and he is a liar.
    Stop spending. CUT the budget. Cut Spending. CUT the size of goverment. CUT the Czars. Cut the pay of congress. CUT Goverment spending.
    CUT social programs.
    CUT entitlement programs.
    CUT MEDICAID.
    USE Socials Security ONLY for social security and ONLY for those who have paid into social security.

    YOU are a SOCIALIST barack. Oh yeah, and a LIAR.

    January 24, 2010 12:11 am at 12:11 am |
  5. mollyd

    Who is Obama going to appoint to this commission? Thieving Wall Street Bankers who are the cause of our current situation, the same ones who continue to to reap the benefits (bonuses) of the most corrupt system in the world?

    Obama is in bed with so many lobbyists. He's the same as all the rest of the politicians. Corrupt and easily bought.

    January 24, 2010 12:12 am at 12:12 am |
  6. Mike

    some "change". first promises no tax increases, then spends upwards of 800 billion dollars on a stimulus that didnt work, considered another that smartly got shot down. trying to pass a 800 billion dollar health care bill AND NOW WAKES UP TO THE FACT THAT WE CANT PAY FOR ALL OF THIS...BRING ON THE TAX INCREASES!!!! Too boot instead of taking responsibility for is unrealistic goals he blames it on bush. WAKE UP AMERICA...THE WORLD IS GOING TO HELL!!!

    January 24, 2010 12:16 am at 12:16 am |
  7. Steve

    After record-setting spending that has driven up our national debt that threatens the future of our country for our children now Obama wants to play a fiscal conservative? I'll believe it when I see it.

    January 24, 2010 12:18 am at 12:18 am |
  8. Jon

    maybe he shouldn't have spent all the money, dont spend so much you wont need to raise taxes moron.

    January 24, 2010 12:18 am at 12:18 am |
  9. DataElf

    Sure, this is a safe bet for Obama. Whatever happens he will be blameless. Bring on the tax hikes, and with them an increase in unemployment. The end result will be the same. what we need is for a fiscally conservative government to step forward, stop the spending and figure out how to balance the federal budget. Yes, this means cutting programs, yes this means not expanding government. You can not take this out of the middle class. For too long the folks in Washington have reaped the rewards from the working class and paid little back.

    Congress – I challenge you to cut your health plans, retirement packages, and salaries in half for just one year. If you are going to cut benefits to the "rest of us", you best show us the way. Talk is cheap.

    January 24, 2010 12:23 am at 12:23 am |
  10. ThinkAgain

    The only problem is the Republicans have absolutely no desire to do what is right for our country; all they want is for President Obama and our country to fail, in their attempts to regain power.

    I know that the Republicans will do everything they can to screw the American public; that's all they did under Bush/Cheney and if anything, they've gotten worse over the last year.

    January 24, 2010 12:23 am at 12:23 am |
  11. Jay Delgado

    People are hurting, the economy is teetering on the brink of a Depression and President Obama proclaims that *now* is the time to start raising taxes on people?
    That the *only* way to pursue 'fiscal responsibility' is to start taxing people more?
    What about CUTTING the amount of money that the Government expends, President Obama? Why isn't *that* being considered?
    It's what I have to do when I find I don't have enough money at the end of the month.

    Wouldn't living within a budget be the more prudent thing to do? Based upon statements like this that President Obama has made, it is becoming painfully plain to see that he is completely disconnected from reality....

    Time to replace him...and soon.

    January 24, 2010 12:23 am at 12:23 am |
  12. Todd

    Mr. President, my best advice is open up the Ronald Wilson Regean play book and engage the machine that made America great. Cut taxes in half, and give bussinesses a 100% tax write off on any medical expences. I.E. if your company provides medical coverage the company can write off 100% of the cost. And if small bussiness owners, such as independent truckers who buy thier own coverage could also write off 100% of the cost come tax time. Mr. President any further problems i can solve for you i am always available.

    January 24, 2010 12:24 am at 12:24 am |
  13. Gordon Shumway

    I'd settle for him telling the truth!

    January 24, 2010 12:27 am at 12:27 am |
  14. Four and The Door

    "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.
    ______________________________________________________
    This coming from the same guy who abused his rubber stamp filibuster-proof congress to blow $1 trillion in the name of jobs only to see the doubling of the unemployment rate after it passed, who spent 3 times NASA's annual budget to prop up auto manufacturers who eventually went bankrupt anyways and then tried with everything he could throw at it to spend another $1 trillion on a plan that would actually raise the cost of health care.

    One big part of the message sent by Massachusetts voters was," We are not all as stupid as your political advisors tell you we are. ". He must not have heard that clearly enough.

    January 24, 2010 12:35 am at 12:35 am |
  15. UtahProf

    Sweeping tax increases??? If they think the voters are angry today, wait until they start raising taxes to pay for their mistakes and the indiscretions of the wealthy. Personally, I pay too much tax as it is and will not tolerate ANY increase – I think it is tax revolt time fellow Americans!!!

    January 24, 2010 12:46 am at 12:46 am |
  16. J.V.Hodgson

    If the Republicans filibuster (or vote down) the establishment of this commission, it would be a huge tactical mistake as it is clearly Bi partisan.
    personally I hope they do as then Obama has every justification for setting something up by executive order.
    Me I would do it the latter way anyway and put all the sessions on CSpan and note the abscence of republicans every time the panel met. Also I would Cspan the vote debate in the house and Senate.
    A straight filibuster would show republicans as they really are not just the party of No but also no ideas other than tax reduction to generate more taxes, in a recession, sorry guys, that does not work.
    Regards,
    Hodgson.

    January 24, 2010 12:50 am at 12:50 am |
  17. USN

    Maybe he is starting to worry about large mobs with torches and pitch forks.

    January 24, 2010 12:52 am at 12:52 am |
  18. Lee, Ann Arbor Michigan

    Finally people are seeing what we knew all along...Obama is unqualified to be President. His background as a "community organizer" was not enough experience to be President.

    His drastic move to socialism/marxism is being rejected by America.

    He will go down in history as "Jimmy Carter the 2nd."

    January 24, 2010 12:55 am at 12:55 am |
  19. Allen, PA

    If the Democrats and Republicans try to put in a commission to take the onus off them for raising taxes there will be a cry worse than anything they have heard to date. Such a commission, if one must be put into existence which I seriously doubt, should offer recommendations on budget reductions only! This would be in the same spirit as the base closing commission.

    But to allow the politicians to hide behind a commission to raise taxes is not acceptable.

    January 24, 2010 12:56 am at 12:56 am |
  20. Nea

    We will see how much the Republicans is willing to be bypartisan by working with this President. They can talk a good game of bypartisanship until things are not going the way they want and then they will say no to everything President Obama propose.

    January 24, 2010 12:57 am at 12:57 am |
  21. Limbaugh is a liberal

    i.e. The administration didn't actually reverse it's position. It was just yet another Biden gaffe, not knowing what the heck he's talking about.

    January 24, 2010 01:02 am at 1:02 am |
  22. Clark

    Excuse me Senator Conrad .... How does a President with an "integrity" that blows with the shifting winds provide "exactly the kind of leadership we need"?

    Who will this "commission" report too and who will hold them accountable? What this sounds like to me is a commission is being created to provide a "plausible" smoke screen which will be used by incumbent congressmen and presidents to hide behind when voting season comes around.

    January 24, 2010 01:02 am at 1:02 am |
  23. Rpearce

    " 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."
    Without raising the debt ceiling there is no way to get out of this giant mess and this train was already rolling down the tracks before Obama was voted in. Both sides are able to force consessions when anything comes up for a vote, I am just trying to hang on until the real revolution begins.

    January 24, 2010 01:03 am at 1:03 am |
  24. Babs

    Ok, now just waiting to see how the Republicans turn this into another negative. Anyone with any thinking power knows that the Republicans have no intention of working together with the President.

    January 24, 2010 01:03 am at 1:03 am |
  25. Mike

    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."

    This President is a big, fat zero. Please obuckethead, resign now.

    January 24, 2010 01:03 am at 1:03 am |
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