WASHINGTON – President Barack Obama on Thursday plans to sign an executive order establishing a bipartisan commission to recommend ways to rein in the nation’s escalating federal debt.
University of North Carolina President Erskine Bowles, a Democrat, and former Wyoming Sen. Alan Simpson, a Republican, will lead the panel.
Obama turned to the executive order after Congress last month failed to pass its own bipartisan plan creating a debt commission.
The most recent estimates put the annual federal budget deficit at $1.56 trillion this year, and the national debt at $8.8 trillion, or 60 percent of gross domestic product, the annual value of the nation’s goods and services. The debt-to-GDP ratio is expected to climb to 72.9 percent by 2015, and history suggests that such huge debt slows a nation’s economic growth and hurts its standard of living.
White House aides declined Tuesday to discuss the specifics of the forthcoming order.
A debt commission with teeth could force congressional votes on changes in politically sensitive programs that lawmakers are traditionally reluctant to change – and that are headed toward insolvency – such as Medicare and Social Security.
In Bowles and Simpson, Obama is tapping two Washington veterans, both of whom were deeply involved in reaching bipartisan budget deals in the 1990s.
Simpson, 78, was a three-term senator who worked across the aisle with Democrats and chaired a Senate subcommittee on Social Security. He’s also a longtime friend of former Vice President Dick Cheney, a top critic of the Obama administration.
Bowles, 64, was President Bill Clinton’s chief of staff from 1996 to 1998 and a key player in getting a 1997 bipartisan budget agreement. He also previously headed the Small Business Administration.