New York (CNNMoney.com) - President Obama issued an executive order on Thursday that formally creates a bipartisan fiscal commission, a first step to forcing painful decisions needed to get the U.S. debt load under control.
Raising taxes, cutting spending and reforming Medicare and Social Security are all fair game, and thought to be impossible without the backing of both Republicans and Democrats.
"Everything's on the table. That's how this thing is going to work," the President said immediately after signing the order.
The commission must deliver a report to the President by Dec. 1 that makes recommendations for bringing annual deficits to no more than 3% of the size of the economy, as measured by gross domestic product, or GDP. Currently annual deficits for the next decade are on track to be well above that level.
The commission will also be expected to suggest ways to permanently lower the country's total debt – currently expected to hit 77% of GDP in 2020, according to the White House Budget Office.
The President formally named the two co-chairmen he has chosen for the commission: Alan Simpson, a former Republican senator from Wyoming, and Erskine Bowles, a Democrat who served as White House chief of staff under President Clinton.
He said the two men "are taking on the impossible: they're going to try to restore reason to the fiscal debate."
The commission will have 18 members. Six of them, including the co-chairmen, will be chosen by the president. Another six of them, divided evenly between the parties, will be chosen by the majority and minority leaders in the House. And six of them will be chosen by the leaders of both parties in the Senate.
It's not clear yet when the Democratic leadership will name their choices.
It was also not clear before the President signed the executive order whether House and Senate Republicans would even choose to participate.
After the President signed the order, a spokesman for Senate Minority Leader Mitch McConnell, R-Ky., told CNNMoney.com that McConnell will name three Senate Republicans to the panel. But his instructions to them will be to focus more on spending cuts than tax increases.
"After trillions in new and proposed spending, Americans know our problem is not that we tax too little, but that Washington spends too much – that should be the focus of this commission," McConnell said in a statement.
A spokesman for House Minority Leader John Boehner, R-Ohio, gave some indication that House Republicans might participate but didn't say it was confirmed.
"We still haven't heard from the President on our proposal to start cutting spending right now," the spokesman said. "That doesn't mean we won't participate in this commission, but it does indicate that Washington Democrats aren't serious yet about shutting down their spending binge."
Earlier this month, Boehner had asked the President if he would use certain legislative procedures to ensure that the House cannot ignore White House spending cut proposals.
Deficit hawks say that the country cannot adequately address the looming fiscal shortfalls without addressing both taxes and spending.
Since the commission is being created by presidential order and not by statute, Congress isn't legally required to vote on its recommendations. The Senate last month voted down a statutory commission which would have guaranteed that the commission's recommendations would be given an up-or-down vote in the House and Senate – no amendments, no filibuster.
Nevertheless there is a chance that recommendations from the presidential commission will be given serious consideration. Senate Majority Leader Harry Reid, D-Nev., and House Speaker Nancy Pelosi, D-Calif., have given their assurances - in writing - that they will bring the group's recommendations to the floor for procedural votes before the end of the year. The House will only take them up, however, if they pass the Senate first.
Voting for the commission's recommendations will likely be a tough pill for both parties. But the idea behind a bipartisan panel is that it can give political cover to lawmakers since no recommendation can be made unless it has the support of 14 of the 18 commissioners.
Whether lawmakers choose to face the challenge of addressing the country's long-term fiscal challenges head-on is a matter of political will. So far that will has not been in evidence. It remains to be seen whether a bipartisan commission dedicated to the task can help turn that around.
"This is not a Republican or Democratic problem – this is a challenge for America," Bowles said in a White House statement announcing the commission.
Even if the panel's work can't push Congress to overcome its inertia on the issue, Simpson said, "The American people are going to know about a lot more where we are headed with an honest appraisal of our situation."
Too little too late,now study the debt after running up a debt like a drunk sailor on speed.What will this clown do next?Maybe another panel on healthcare.
Quadruple the deficit-raise the debt limits-take 862 billion -start a cash for clunkers-then spend all these available funds on pork and dead end projects.
Another waste of money. If nobama and the demorats wanted to cut spending then they would simply stop spending. They will ignore anything from this panel and continue with their tax and spend. CHANGE IS COMING for real in 2010 and 2012.
This is how politicians will avoid making the difficult choices to cut governement spending. "Lets Form a Committee" is rule number 1 in the game of CYA.
HA! WHAT A JOKE! This is like the fox guarding the chicken coop. Anytime a problem captures the attention of the media and the American people, Obama has to create either a panel or a czar position, so that when the solution fails and the problem gets worse, Obama will have someone he can blame. Obama wants to be a leader, but one with no responsibility.
Let's start by firing all the czars, followed by this new panel, and again followed by the big "O" (take Oprah with you). Add back into the equation line item veto, min 30% reduction in politican perks plus put them on the same retirement & health as the rest of us, and 2 term limits. After that, I'm available for further consultation.
Well, we just saved or created two more jobs which congress and the White House could have handled on their own without additional cost to the taxpapers. Well, 8 million+ more jobs to go.
I don't know, but it sounds to me like the President is "the real deal." He asked Congress to form a task force, they wouldn't, but America NEEDS BIPARTISAN SUPPORT FOR REAL DEBT RESOLUTION/DEBT REDUCTION and President Obama is not taking "NO" for an answer.
Republicans AND Democrats need to step up and take the hits they have coming for the mess that they let us get into while they protected their own jobs.
We need to send them all home and get House and Senate representation for "We The PEOPLE!"
Well, we just saved or created two more jobs which congress and the White House could have handled on their own without additional cost to the taxpayers. Well, 8 million+ more jobs to go.
Glad to see Boehner and McConnell will actually appoint people to the bi-partisan panel they voted against. I sure wish they would have funded the wars and the medicare drug plan from the previous administration.
"This is not a Republican or Democratic problem – this is a challenge for America."
Wrong. This is a Democratic problem, with the 2010 budget passed without a single Republican vote. You own it now. The GOP won't provide bipartisan cover for the spending orgy, and will sign on to the toothless "deficit commission" only if Dems agree in advance that tax increases are off the table.
Good idea to wait until after the November elections President Obama.
When you receive the report on Dec 1st, you can use it to wipe the tears from your eyes. A good cry will help you cope with the Democratic losses in the House and the Senate.
One man's tears are another mans cheers!
I don't know what to laugh or cry about first, here.
This is another act of political theater and cover your ass subterfuge! There are really only two choices, cut spending or raise taxes and President Obama and the Congressional Democrats have shown no will power to do the former so look out for the latter.
"Everything's on the table." Let's see how that works out if they recommend cutting Obama's bloated budget increases which he already excluded from his save a penny, spend a pound sham of a spending cut starting next year. It's similar to his open, bipartisian meeting on health care where they are expected to start with the current health care bills and march forward.
The only real answer is to cut spending because there aren't enough evil rich people and big business to tax to pay for all of Obama's political agenda.
Wow, by December 1 ? Such urgency BO.
Another publicity stunt and more wasted taxpayer money.
Hey, did you hear the latest one ?
How many Tzars does it take to screw in a light bulb ....