Romina Boccia
Following the Fiscal Responsibility Act’s passage, many legislators remain rightfully concerned that the May 2023 debt limit deal doesn’t do nearly enough to rein in out‐of‐control federal deficits and debt. Now Fitch Ratings has given them a wake‐up call by downgrading the U.S. credit rating from AAA (the highest possible rating) to AA+. The good news: some members are grappling seriously with fiscal governance issues and voicing support for an independent fiscal commission to address the growth in public debt. Critics charge that relying on an independent commission, especially one whose recommendations would be fast‐tracked, would be an abdication of Congress’s fiscal responsibilities. This view is misguided.
Within mere days of the debt limit deal crossing the finish line, House Speaker Kevin McCarthy (R‑CA) floated the idea of a BRAC‐like fiscal commission to address the critical part of the federal budget that was left completely out of debt limit negotiations: rapidly growing entitlement spending. BRAC stands for Base Realignment and Closure and refers to a particular commission structure that helped Congress overcome gridlock in closing military bases. Congress completed five rounds of BRAC from 1988 to 2005, closing more than 100 defense facilities as a result. BRAC offers a powerful model for helping Congress resolve challenges in another politically fraught area: entitlements. According to Rep. Steve Womack (R‑AR), who supported the idea:
“We need to get as much of the politics out of it as we can and just give us the facts… And the facts are that 70% of this whole federal budget is on autopilot right now.”
A BRAC‐like fiscal commission is a promising idea for overcoming political obstacles to entitlement reform. To increase the commission’s odds of success, it should be composed of independent experts, tasked with a clear and attainable objective, such as stabilizing the growth in the debt at no more than the GDP of the country, and empowered with fast‐track authority, such that its recommendations become self‐executing upon presidential approval, without Congress having to affirmatively vote on their enactment.
That last part, that the commission proposal be self‐executing unless Congress objects, is key for giving legislators political cover to vocally object to reforms that will create inevitable winners and losers, without re‐election concerns undermining an outcome that’s in the best interest of the nation. According to Colton Campbell in his book, Discharging Congress: Government by Commission:
“Congress occasionally uses an ad hoc commission to distance itself from a politically risky decision. Members struggle when local interests collide with larger policy needs. They may want to see things go well for the nation, but they also want to get reelected. Typically, these conflicting preferences are such that no one can reconcile them, because most congressional representatives see themselves as agents of their constituents and are therefore unwilling to sacrifice their districts to the collective good… [A commission] mechanism paradoxically enables affected legislators to become advocates for their constituents rather than bearers of bad news. They can passionately plead the case for their constituents but also confront a national policy need.”
Legislators may have legitimate concerns about delegating extensive legislative responsibility to an independent commission, including that such a mechanism would reduce democratic accountability. Unelected officials do not represent constituents in the way members of Congress do. And that’s exactly the point of empowering a commission to make fiscal reforms which have repeatedly eluded Congress.
Discussions concerning the original Base Closure and Realignment Commission are telling in this respect. The late Senator McCain (R‑AZ), in responding to Senator Cohen’s (R‑ME) objection that Congress is abdicating its responsibility to decide over the funding for military bases by delegating the task to a commission, argued:
“The Congress has probably abdicated its responsibilities… However, I would like to point out that it is very clear that we are at a condition of gridlock as far as base closings are concerned…history indicates that we are incapable of acting in any other way because of the enormous political repercussions which result in each of our States as a result of a move to close a base or a military installation.”
Others worry that an expansive fiscal commission with fast‐track authority could violate Congress’s constitutional Article I power that “All legislative Powers herein granted shall be vested in a Congress of the United States.” Legislators can make sure to design a BRAC‐like fiscal commission such that it respects Congress’s legislative powers.
Congressional delegation is constitutionally acceptable so long as Congress establishes clear directives, such as tasking the commission with achieving a specified outcome (i.e. stabilizing debt at no more than 100 percent of GDP within the 10‐year budget window), and puts in place oversight functions (i.e. reporting requirements), and for as long as Congress retains ultimate legislative say (i.e. the ability to reject the commission proposal). As the Supreme Court noted in Yakus v. United States, “Congress is not confined to that method of executing its policy which involves the least possible delegation of discretion to administrative officers.”
Contrary to what some legislators and their staff seem to believe, there’s no need for Congress to take an up‐or‐down vote on a fiscal commission proposal. Whether Congress decides to empower a fiscal commission with fast‐track authority is a way to assess whether legislators are serious about tackling the country’s fiscal challenges or kicking the can down the road with yet another fig leaf commission. According to J.D. Foster, a former Heritage Foundation economist who previously served as chief economist for the Office of Management and Budget under George W. Bush:
“A distinguishing feature between a useful and a useless deficit commission is whether Congress is required to vote on its recommendations. Unless Congress expressly legislates to the contrary at the outset, a presidential commission’s recommendations are little more than dust in the wind.”
BRAC discussions in the House of Representatives during the 100th Congress reflect a similar view. As Representative Jon Kyl (R‑AZ) stated:
“I do not think we are fooling anyone when we say we are all for closing obsolete bases, but then we attach so many preconditions to it that we know we are never going to end up closing the bases. One of these is the difference between automatic closure and the provision that would require Congress to affirmatively act. Who among us believes that we will actually close bases if we have to affirmatively act?”
It’s difficult to believe Congress would find it any easier to affirmatively vote for entitlement benefit changes than for base closures. Prudent legislators must confront the political reality of complete gridlock on the entitlement spending issue and act accordingly. With Medicare and Social Security responsible for 95 percent of long‐term unfunded obligations, according to the Treasury Financial Report, there’s simply no way that any serious fiscal reform effort can leave these programs untouched.
Congress long ago decided to abdicate its fiscal responsibilities by putting large and far‐reaching government programs on autopilot, without any meaningful requirement for regular review. Entitlement programs like Social Security and Medicare have grown without course correction for decades. It becomes clear to even casual observers of congressional budget battles that legislators seem paralyzed in addressing exploding entitlement spending. Few legislators—or presidential candidates—are even willing to talk about the need to reform programs like Medicare and Social Security.
At least a few legislators are beginning to consider a new mechanism for forcing action on the growing debt issue. Delegating debt stabilization to an independent commission with fast‐track authority is a sign of Congress taking responsibility for correcting the fiscal course, it is not an abdication of duty. And addressing the unsustainable growth in Medicare and Social Security spending is also the one meaningful way to restore the U.S. credit rating for the long‐term.