Today, U.S. Senator Rob Portman (R-Ohio) introduced the Dollar-for-Dollar Deficit Reduction Act, a bill that will promote spending reform by preventing Congress from raising the debt limit unless that legislation also cuts commensurate spending over the next decade. The entire amount should be offset within federal programs, allowing the interest savings on the national debt to provide additional savings above the debt limit increase amount.
"As we begin the latest in a string of battles over raising the debt limit, it's time to address the underlying problem - why is Washington's spending so out-of-control that it has to borrow money to pay our bills? Our economy has not exhibited the robust growth we all hope for, and continuing this pattern of soaring spending will only worsen matters by piling onto our record-high debt and dumping an unconscionable burden on future generations," Portman said.
"Washington cannot continue to raise the debt limit while kicking the can down the road on deficit reduction. In order to spur job creation and get our economy back on the right track, we must restore fiscal responsibility, and this starts by stopping Washington's reckless pattern of spending money we don't have," Portman added.
Far from a simple procedural vote, the debt limit has provided Congress with an opportunity to rein in the expanding national debt. The 1985 Gramm-Rudman-Hollings Act, which helped reduce the deficit, was attached to a debt limit bill. The three largest deficit reductions bills in the 1990s -- in 1990, 1993, and 1997 -- were each linked to debt limit legislation, as was the Statutory Pay-As-You-Go Act of 2010. Finally, the debt limit was the impetus for the 2011 Budget Control Act, estimated to save $2.1 trillion over the decade. In short, nearly every significant deficit reduction law of the past 27 years has been linked to a debt limit debate.
The Dollar-for-Dollar Deficit Reduction Act will make the "dollar-for-dollar" rule a permanent debt-limit policy to ensure that any increase in the debt limit corresponds with spending cuts. The bill requires that the Treasury Secretary notify Congress 60 calendars days before the debt limit is to be reached and extraordinary measures undertaken. In addition, the Dollar-for-Dollar Deficit Reduction Act:
Requires that any Presidential request to raise the debt limit be accompanied by a proposal to cut non-interest spending by an equal or greater amount over the next decade;
Requires that any legislation to increase the debt limit include non-interest spending cuts of an equal or greater amount over the next decade, subject to a point of order; and
Prohibits the use of timing shifts and expiring emergency spending (Such as overseas contingency operations) to reach the spending savings target.
The Dollar-for-Dollar Deficit Reduction Act will:
Reduce spending by more than $3 trillion over the next decade;
Reduce spending below 20 percent of GDP by 2022;
Reduce the budget deficit to just 1 percent of GDP by 2022, paving the way for a fully balanced budget.