JIM LEHRER: The president signed an executive order today setting up a bipartisan commission on the federal deficit. He did so as the issue grows in political urgency.
Judy Woodruff has our coverage.
U.S. PRESIDENT BARACK OBAMA: There you go.
JUDY WOODRUFF: It was a simple pen stroke to take on a gargantuan task: finding ways to cut red ink projected to hit $1.6 trillion this year alone.
BARACK OBAMA: Without action, the accumulated weight of that structural deficit of ever-increasing debt will hobble our economy, it will cloud our future, and it will saddle every child in America with an intolerable burden.
Now, this isn't news. Since the budget surpluses at the end of the 1990s, federal debt has exploded.
JUDY WOODRUFF: That explosive growth has been fed by the cost of two ongoing wars, ever-expanding Social Security and Medicare payments, and, since the financial crisis, bank and automaker rescues, and falling tax revenues.
The president's solution: an 18-member Commission on Fiscal Responsibility and Reform, with appointees from both parties, at its helm, co-chairs Democrat Erskine Bowles who was White House chief of staff for President Clinton, and Alan Simpson, the former Republican senator from Wyoming.
BARACK OBAMA: I'm asking them to produce clear recommendations on how to cover the costs of all federal programs by 2015, and to meaningfully improve our long-term fiscal picture.
JUDY WOODRUFF: Mr. Obama said, everything is on the table, in a bid to cut the deficit to 3 percent of the nation's gross domestic product, down from well over 10 percent this year.
The recommendations will not be binding. But Republicans immediately warned that the panel will be weighted toward Democrats and liberal groups and is likely to focus on higher taxes.
In a statement, Senate GOP Leader Mitch McConnell said: "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."
Mr. Obama had wanted Congress to form a commission with the power to force lawmakers to vote on deficit cuts after the November elections. That idea failed in the Senate last month.
I sat down with the two chairs of the president's new commission in the Eisenhower Executive Office Building this afternoon.
Erskine Bowles, Senator Alan Simpson, it's good to see both of you.
ERSKINE BOWLES, co-chairman, National Commission on Fiscal Responsibility and Reform: Thank you. It's great to be here.
ALAN SIMPSON, co-chairman, National Commission on Fiscal Responsibility and Reform: Good to be here.
JUDY WOODRUFF: Senator Simpson, you told a Montana newspaper this is like being on a suicide mission.
Did you really mean that?
ALAN SIMPSON: Well, I hate -- it's a dual suicide. I'm taking him with me off the cliff.
ALAN SIMPSON: Let me tell you, in all the humor of it, this is dead serious stuff.
And when the two of us were called by the president, you -- you respond. It doesn't matter who the president is. You respect the office. And, when I was contacted, and they said you're going to be in it with Erskine Bowles, and then there are going to be a commission of 18, and I called Erskine, and he said, you know, what we need to do is just push the ball forward, and do it for our grandchildren.
And that's what we're here for. It sounds corny, I know, but that's the way it is.
JUDY WOODRUFF: Erskine Bowles, help people understand, how overwhelming is the job that you have been asked to do?
ERSKINE BOWLES: It's -- it's staggering.
We have a deficit-to-GDP ratio today of 10.6 percent. We got $1.6 trillion in new debt coming on to the country. You know, Judy, I'm at the University of North Carolina now. And I know that, if we don't get our people better educated, we're going to be a second-rate power before you know it.
And I can tell you, if you just think about the interest on the national debt over the next 10 years, it's going to increase by $650 billion. That's $650 billion we could spend on innovation, on research, on education. You know, if we don't do things like that, we -- we're not going to be able to compete in a knowledge-based global economy. This is a big, big issue.
JUDY WOODRUFF: It's a big issue, Senator, but it's something that nobody else has been able to do for the last several decades. What -- what makes you think you can get something done?
ALAN SIMPSON: Well, I have been on some groups that did that. I was on the Select Commission on Immigration and Refugee Policy, which was chaired by Father Ted Hesburgh. And we came up -- I think it was the first commission I had been on where we came up with legislation.
We did a legal immigration bill and an illegal immigration bill. And then I was on the Iraq Study Group, where, you know, 10 Americans, five Democrats, five Republicans, unanimously agreed. I know it can work if people are of good will.
JUDY WOODRUFF: Well, some people, mainly Republicans right now, are arguing, what's really needed are tax cuts, that, even if it raises the deficit in the short term, that this would get government out of the way of business, business could grow, and the deficit will take care of itself.
ALAN SIMPSON: Well, I'm not smoking that same pipe.
ALAN SIMPSON: I just -- everything is on the table. But, if we're just going to use flash words like cutting children's benefits or cutting veterans or raising taxes, it will be a tougher struggle.
Everything is out there. We -- I know how to -- how people use emotion, fear, guilt, and racism. I have been through that old stuff with immigration. If those -- I say to them, I don't use those. I use facts. And we're going to do a lot of facts.
JUDY WOODRUFF: So, Erskine Bowles, most economists who sit down and you talk to them seriously will say, it's got to be a combination of tackling the entitlement programs, like Social Security, like Medicare, modifying the way those programs work, and, frankly, raising taxes.
I mean, are those things that you're going to be seriously considering?
ERSKINE BOWLES: Judy, I think the great thing is, when Alan and I talked to the president the very first time and every time since, he stressed two things: This has got to be bipartisan to work. It can't be a Republican, it can't be a Democrat thing. This is a challenge for the country.
And, second, he has insisted that everything be on the table. And that's everything.
JUDY WOODRUFF: And that includes tax increases for the middle class?
ERSKINE BOWLES: If you start by taking something off, we will never get there. He has said, everything is on the table.
ALAN SIMPSON: And, again, it's just a flash word.
The last time they did the Social Security correction, they tweaked the system. I think it was one-tenth-of-1-percent of the payroll tax. Well, if that makes people shriek and go over the edge of the cliff -- you have two choices with Social Security. You either -- you either raise the payroll tax or decrease the benefits, or start affluence-testing, try that one on.
Man, oh, man, there's a big one. But the rest of it is B.S. And if the people are really ingesting B.S. all day long, their grandchildren will be picking grit with the chickens.
JUDY WOODRUFF: But there are people out there just waiting for something like that to happen.
In fact, there was a congressman from Georgia today, Tom Price, a Republican, who said, the fact that the president is already putting I think a couple of more Democrats on this 18-member commission than he is Republicans means, he said, the odds are high that your recommendations are going to be heavy on tax increases and light on spending recommendations.
ERSKINE BOWLES: That's -- to jump to that conclusion just doesn't make any sense, because, first of all, you know, it takes 14 votes out of the 18 to make any recommendation at all.
So, the six people being appointed by the Republican members of Congress are going to be able to veto any legislation or anything coming out of this.
ALAN SIMPSON: See, this guy is missing the boat.
ERSKINE BOWLES: Yes.
ALAN SIMPSON: This is sound...
ERSKINE BOWLES: Yes.
ALAN SIMPSON: This is sound bite business. And that's great. That gets you reelected. But it won't help the country.
JUDY WOODRUFF: You -- you -- Senator Simpson, there is, at the same time, an atmosphere in this city, people call it a hyper-partisanship, of just a bitter division between the two parties.
And, right now, you have got, quite candidly, leaders in the Republican Party, Majority Leader Boehner, Senator McConnell, who initially resisted the idea of even appointing anybody to this commission.
ALAN SIMPSON: But now they're going to do it. And I visited with both John and Mitch and told them what I was going to do. And I said, I hope you can help. I hope you will appoint some good people.
And they said, we will talk. And I understand that they're making -- they're going to make selections. That's all we can ask.
JUDY WOODRUFF: Speaking of this atmosphere of partisanship, Erskine Bowles, how much harder does it make your work? I mean, how do you compare it to the time you were in Washington with President Clinton?
ERSKINE BOWLES: Yes. Look, this is going to be very difficult. Make no mistake about it.
But I can tell you, when President Clinton announced he was bringing me back to Washington to be chief of staff to -- quote -- "balance the budget," I can remember going on Tim Russert's show. And nobody, not even Tim, believed it was possible that we had a chance of bringing both sides together.
And we negotiated what became the first balanced budget in a generation. And I believe we have a chance, if we deal with trust, we put all the facts on the table, to make progress.
JUDY WOODRUFF: But don't you think the -- that the partisanship is even worse now?
ERSKINE BOWLES: I think it's very tough, yes.
ALAN SIMPSON: I think it's worse than I have ever seen, but that doesn't mean that we should just hang up the phone and let this engine come down the track with no brakes on. And that's what's happening. This is an engine with no brakes.
JUDY WOODRUFF: Finally, you mentioned what Congress tried to do, it didn't work, the congressionally created commission to tackle the deficit.
Unlike that commission, this commission doesn't have -- whatever you recommend is not going to be binding. You're going to make some recommendations, but they're not going to -- nobody in Congress is required to enact this.
So, how do you make it -- how do you translate what you do into...
ERSKINE BOWLES: I think, if you go back and look at Alan's commission, the one that you just did, the Iraq Study commission, you know, over 40 of their recommendations have been, you know, brought into law today.
I believe that if we put the facts on the table and provide the administration and provide the members of Congress some real information, and the American people understand that you can't just tweak this and get to the bottom line, then I think we have got a chance to really advance the ball.
ALAN SIMPSON: But we may be -- we will be called naive. I will be called a Republican toady. Rush babe will be after me day and night. I mean, it's going to be a thrilling experience. But I have been there before.
But this is bigger than me or Erskine or you. This is about your children. This is about the future of America. This country is going to go to the bowwows unless we deal with the entitlements and Social Security and Medicare.
ERSKINE BOWLES: I will have the same problem from the left when we start talking about entitlements. But we have to tell the truth.
ALAN SIMPSON: And we're going to.
ERSKINE BOWLES: Yes.
ALAN SIMPSON: If -- if -- I think people will trust us. I hope that's the case. At least, so far, so good. They will say, I don't like Simpson, but the nut is half-right sometimes.
And -- and, so, I have no illusions about this. My dear wife, Ann, who you know, she said, Al, what are you doing?
And I said, well, it's for the cause. It's for our grandkids.
She said, the old carry on. Here's a sandwich, and head out the door, and a brown-bag lunch.
JUDY WOODRUFF: So, do -- you do expect to take flak?
ALAN SIMPSON: Oh.
ERSKINE BOWLES: You bet.
ALAN SIMPSON: We -- and you know how we will beat them? With humor. Humor is the universal solvent against the abrasive elements of life. And when they begin to hammer on us -- the people who hammer on you are humorless. They don't know what a smile is or laughter.
They have got -- they're hundred-percenters. They have got B.O. and heartburn and gas.
ALAN SIMPSON: And they just come at you. And, so, those people are easy to handle. They get irritated. They call us silly people. See, that's how that works.
JUDY WOODRUFF: We will be watching both of you.
ALAN SIMPSON: I know you will.
JUDY WOODRUFF: Thank you very much.
ERSKINE BOWLES: Thanks.
JUDY WOODRUFF: Senator Alan Simpson, Erskine Bowles, thank you both.
ERSKINE BOWLES: Thank you.
ALAN SIMPSON: Thank you.