The proposal, offered as an amendment to the debt limit bill, establishes an 18-member bipartisan taskforce that would review all aspects of the current and long-term financial condition of the federal government. Fourteen of the 18 voting taskforce members – comprising eight Republicans and ten Democrats – would have to agree on recommendations to submit to Congress where they would be considered under expedited procedures.

"These deficits did not happen overnight, and they won’t be solved overnight. We not only need to change how we pay for policies, but we also need to change how Washington works. The only way to solve our long-term fiscal challenge is to solve it together – Democrats and Republicans," Obama commented.

"That’s why I strongly support legislation currently under consideration to create a bipartisan, fiscal commission to come up with a set of solutions to tackle our nation’s fiscal challenges – and call on Senators from both parties to vote for the creation of a statutory, bipartisan fiscal commission," he added.

The taskforce, which would also include the Treasury Secretary and another administration official chosen by the President as non-voting members, would review projected federal revenues and expenditures and analyze their impact on the future financial position of the federal government. The panel would then make recommendations with legislative text about spending and revenues in a bid to correct long-term federal fiscal imbalances.

The US federal deficit hit USD1.4 trillion last year, equivalent to around 10% of the US economy, and it is projected to moderate only slightly this year, to USD1.35 trillion.

“Our statutory taskforce proposal provides the best chance for developing a truly bipartisan solution to this problem," said Conrad, a North Dakota Democrat and Chairman of the Senate Budget Committee.

"No one political party can solve this on its own. We need both sides of the aisle committed to working together to confront the threat of runaway debt," he added.

Gregg, Budget Committee Ranking Member, warned that US debt, which is approaching a level of 60% of US gross domestic product (GDP), is rapidly nearing a "tipping point" from which it would be very difficult for the country to pull back. Gross debt of 100% of GDP is possible "within a few years," he warned.

“We are facing an imminent crisis – the nation’s debt is at historic levels, and a few years down the road we will encounter a fiscal avalanche of unfunded obligations as the Baby Boomers enter full retirement. We must take steps to start managing this problem now," the New Hampshire Republican stated.

"It is unfortunate that Congress, under its existing practices, cannot take even the initial steps to try to address this problem. History has proven that only a bipartisan, expedited legislative process that is insulated from political attacks will achieve the legislative results that we so desperately need in the area of fiscal reform,” he added.