Lawmakers Say Proposal to Create Debt Panel Faltering (Update1)

Jan. 15 (Bloomberg) -- A push to set up a special commission whose recommendations for reducing the U.S. government’s debt would be guaranteed a vote in Congress faces an uphill battle, lawmakers said.

Senator Judd Gregg, a New Hampshire Republican who is one of the commission’s main advocates, said in an interview yesterday that proponents remain short of the 60 votes needed for Senate approval. He is leading the effort with Senate Budget Committee Chairman Kent Conrad, a North Dakota Democrat.

Gregg said President Barack Obama’s administration and House Speaker Nancy Pelosi are “undermining” the effort by promoting an alternative in which the commission would be created by the president through an executive order.

Gregg called that a “cynical game” and “phony exercise” because Congress could ignore recommendations by such a group. The measure proposed by Gregg and Conrad would require lawmakers to vote on the commission’s recommendations.

Ways and Means Committee Chairman Charlie Rangel, a New York Democrat who opposes Gregg’s plan, agreed that a commission created by presidential order probably would be ignored by lawmakers.

“We can’t stop an executive order, but I can’t see where the executive order would have any teeth,” Rangel told reporters today. “You need the Congress’s agreement.”

House Majority Leader Steny Hoyer, a Maryland Democrat, said Jan. 13 any debt panel would probably have to be created by Obama because “neither Gregg nor Conrad think they have the votes” for their plan.

AARP Opposition

A spokesman for the White House Budget Office didn’t respond to a request for comment. A spokesman for Pelosi, a California Democrat, declined to say which approach she favors.

The AARP, the advocacy group for the elderly, urged lawmakers yesterday to reject Gregg and Conrad’s proposal. The AARP cited the potential for cuts affecting Medicare and Social Security beneficiaries.

The Senate will begin debating the commission measure as soon as next week when lawmakers begin considering a long-term increase in the federal debt limit. The Congressional Budget Office projects the government will pile up $9 trillion in deficits over the next 10 years.

Conrad, Gregg and others blocked action on a long-term increase in the debt limit last month and got Senate Democratic leaders to agree to allow a vote on their commission proposal. Under the plan, the 18-member panel would offer deficit-cutting suggestions after this year’s midterm elections in November.

Its recommendations wouldn’t be subject to amendment by the House or Senate, and a three-fifths majority in each chamber would be needed to enact the proposals. Lawmakers including Senate Finance Committee Chairman Max Baucus, a Montana Democrat, opposed the idea because it would take power away from their committees.

To contact the reporter on this story: Brian Faler at bfaler@bloomberg.net