House Speaker Kevin McCarthy is turning to history when considering appointing a mix of business leaders and lawmakers as he lays the groundwork for a new commission to tackle the nation’s growing debt.
The speaker is fresh from his political victory of negotiating the bill that suspends the debt ceiling until January 2025 while producing a predicted $1.5 trillion deficit savings over the next decade. However, the legislation only focused on a small portion of federal spending each year and excluded programs, including Medicare, Medicaid, and Social Security, that comprise the majority of government spending and are the biggest generators of debt.
McCarthy has embraced establishing a new commission to locate additional deficit reductions. Although similar commissions have found some success, the most recent ones needed more support from Congress to move on with their recommendations. The speaker has asked GOP Representative Garret Graves of Louisiana to work with him on the issue, which follows Graves’ work as one of the critical debt ceiling negotiators in talks with the White House.
“I’m studying different angles to see what would best work, some with members. And should I bring in some people from the outside so you have some modern people in the business world that have taken companies and looked at them to streamline and modernize for efficiencies?” said McCarthy. “I think that combination would work well, but right now, I’m spending a lot of time on how to put that together.”
Analysts say it will take a combination of tax hikes and spending cuts to change the country’s financial trajectory meaningfully. However, that is where the problem lies. Many Republicans won’t consider raising taxes, while Democrats won’t consider any cuts in benefits.
Speaker McCarthy refused to accept tax increases as part of the debt ceiling talks. When asked if he had any red lines for the debt commission, he said he is currently focused on structuring the commission right. Still, he added that the revenue coming into the government’s coffers, around 19.2% of last year’s gross domestic product, is at the high end of the 50-year average.
Democrats are wary of the commission
Democrats continue to tread warily. “I’m not sure what he envisions, but I look forward to having that discussion,” Democrat Minority Leader Hakeem Jeffries of New York said. “I have no idea what the contours of the commission would even look like, so it’s hard for me to commend up or down at this point.”
GOP Representative Steve Womack of Arkansas said he likes the idea of a commission.
“We need to get as much of the politics out of it as we can and just give the facts,” said Womack. “…And the facts are that 70% of this whole federal budget is on autopilot right now.”
Womack stated he isn’t calling for Congress to “cut a lot of these programs, but we do have to make these programs sustainable in the future.”
The second-ranking Republican on the Senate side, Senator John Thune, endorsed the commission concept and said: “We got to start taking this stuff on.”
“I think that makes all the sense in the world. Let’s get the best experts in the room and figure out what’s the best way to fix these issues, make these programs sustainable and see if we can’t do something to address deficits and debt in a meaningful way,” said Thune.
Conversely, the Democratic chair of the Senate Finance Committee, Senator Ron Wyden, said he sees it as a way for Republicans to pursue “ideological trophies.”
“Everything I’ve heard about it, it’s a prescription for trouble,” said Wyden, adding, “They’re looking at a glide path to reduce benefits.”
The most recent efforts to reduce deficits using a commission failed. In 2010, the Simpson-Bowles Commission fell three votes short of the 14-vote threshold required to send the package to Congress for an up-or-down vote.
After Simpson-Bowles, Congress approved legislation that formed a Joint Select Committee on Deficit Reduction the following year. However, the “supercommittee” failed only two months later and could not produce a deficit-cutting plan.