Proposal to tackle
runaway spending and borrowing, reduce
deficit
July 27th, 2010
- WASHINGTON, DC - U.S. Senator John Thune today introduced legislation
that will begin to tackle the nation's ballooning $13 trillion debt by
reforming the budget process and cutting federal spending and
borrowing.
“As families across our country make tough financial choices to
live within their means, Washington continues to spend borrowed money
at an alarming and dangerous rate,” said Thune. “My bill would cut and
cap spending, reform the broken budget process, end the trust fund
dishonesty, and create a new permanent joint Congressional committee
tasked with continuously cutting the deficit without raising taxes.
While my proposal will not be a cure-all for our nation's economic
woes, it would fundamentally change the way Congress does business.
“Our dangerous national debt is not an issue we can continue to
pass along to future generations of Americans. This legislation is a
necessary first step toward reining in Washington's runaway spending
habits, while restoring fiscal accountability to our government.”
Thune's budget reform legislation, The Deficit Reduction and Budget
Reform Act of 2010, takes a three-pronged approach to reducing the
rapidly expanding burden of growing debt and deficits for American
families and businesses. By imposing strict new limits on federal
spending, reforming the budget process, and creating a new standing
committee of Congress for budget deficit reduction, Congress can prove
to the American people that it is serious about cutting spending and
growing our economy.
Details of Thune's legislation are outlined below.
Part I: Eliminating Wasteful Spending
Discretionary Spending Caps
Establishes binding discretionary spending caps for all
non-defense, non-veteran, non-homeland security discretionary spending
from 2011 to 2020. Discretionary spending caps are set at Fiscal Year
2008 levels adjusted for inflation, and any bill that exceeds the
spending caps is subject to a point of order.
Stop Stimulus Spending
Ends unobligated stimulus spending on September 30, 2010. Stimulus
tax provisions would be allowed to expire on December 31, 2010 as
enacted by the stimulus bill.
Part II: Budget Reform
Improving PAYGO and Trust Fund Accounting
Reforms PAYGO rules to prevent the double-counting of new revenues
or reduced spending in trust funds for the purposes of offsetting other
expenditures. Over $600 billion in trust fund offsets were used to pass
the health care reform bill and earlier this year an attempt was made
to increase the per-barrel tax for the Oil Spill Liability Trust Fund
to offset other non-related tax measures. By preventing these changes
from being used as an offset under PAYGO rules in the future, this
provision would end the practice of double accounting these spending
reductions and revenue increases.
Binding Federal Budget
Reforms the budget process by requiring a binding joint budget
resolution. Since the joint resolution would have to be signed into
law, the Administration and Congress are forced to work more closely on
the joint budget resolution and Congress would have less flexibility to
violate this resolution.
Biennial Budget
Establishes a biennial budgeting timeline. In odd numbered years,
Congress would pass two-year biennial budgets. In even numbered years,
Congress would pass two-year appropriation bills. A biennial budget
would give Congress more time for oversight of government spending
during even numbered years. This provision is particularly important
because Congress has only completed all of the annual appropriation
bills on time in four of the last 34 years.
Legislative Line-Item Veto
Creates a legislative line-item veto. The President may propose to
Congress a cancellation of any discretionary spending item, direct
spending item, limited tariff benefit or targeted tax benefit contained
within a bill or joint resolution. Upon Congressional approval, any
cancellations must be applied to reducing the deficit or increasing a
surplus.
Part III: New Joint Committee on Deficit Reduction
Standing Joint Committee of Congress on Deficit Reduction
Creates a permanent Joint Committee on Deficit Reduction composed
of a bipartisan group of 20 members—10 from the House of
Representatives and 10 from the Senate. Every other year, the new Joint
Committee must introduce legislation that eliminates or reduces
spending on wasteful government programs and achieves a savings of at
least 10 percent of the previous year’s budget deficit. The legislation
to reduce spending or wasteful programs would receive expedited
consideration in the House and Senate.