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What Is the Grace Commission?

By Paul Cartmell
Updated May 17, 2024
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The Grace Commission was officially known as The President’s Private Sector Survey on Costs Control, or PPSSCC. President Ronald Reagan established the commission by a Presidential Executive Order on 30 June 1982 with final reports presented to the U.S. Congress in January 1984. 47 individual reports and a summary report were created by the Grace Commission, which included recommendations on areas for possible savings by the federal government. The findings of the commission and estimates of possible savings are controversial and are disputed by government agencies in the U.S.

President Reagan created the Grace Commission to find areas where the income taxes collected by the U.S. Federal Government were wasted or misused by the departments or agencies to which they were awarded. The commission was made up of prominent managers of private sector businesses and experts in managing private sector companies. J. Peter Grace was appointed to head the PPSSCC, which included contributions from over 2,000 individuals. Private funding was found for the work of the commission estimated to have cost around $75 million.

To create the report on government inefficiency, the members of the commission were split into 36 task forces that focused on the work of individual agencies and departments. During the 18 months that it took to complete the work of the Grace Commission, each of the 36 task forces created a report detailing its findings, with an additional 11 reports created on waste and inefficiency. The final summary report detailing the work of the commission was printed over two volumes and included 650 pages. 748 issues were identified by the PPSSCC that resulted in 2,478 recommendations for eliminating wasteful practices within the government.

Recommendations made by the commission were calculated to produce savings of $429.4 billion between the years 1985 and 1987 if implemented by Congress. In the long term, the U.S. national debt was estimated to be reduced if all of the recommendations of the Grace Commission were implemented from an estimated $13 trillion in 2000 to $5.8 trillion by the same point in history. A major claim made by the commission was that all of the money collected in income taxes was used to pay interest on the national debt and in payments made to welfare programs. Upon its presentation to Congress, the recommendations were largely ignored by the legislative body.

Government agencies disputed the findings and estimates of dollar savings based on the recommendations of the commission. The Congressional Budget Office and General Accounting Office of the U.S. Federal Government argued the many reports produced by the PPSSCC had overlapped and some of the savings reported had been calculated more than once to produce the estimated savings to the national debt. Bias is often reported over the Grace Commission’s work because the original reason for establishing the body was to find evidence backing cuts in income taxes. Reports produced in response to the Commission's findings are created by the departments and agencies criticized in the final reports as being wasteful and inefficient.

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