July 15, 2011
Cuts total spending by $111 billion in FY 2012. The savings is divided as follows:
- Reduce non-security discretionary spending below 2008 levels, which saves $76 billion.
- $35 billion cut to non-veterans, non-Medicare, non-Social Security mandatory spending.
- Defense budget at President’s level.
Total federal spending is scaled back based on the glide path for the fiscal years below:
- 2012, 22.5% of GDP.
- 2013, 21.7% of GDP.
- 2014, 20.8% of GDP.
- 2015, 20.2% of GDP.
- 2016, 20.2% of GDP.
- 2017, 20.0% of GDP.
- 2018, 19.7% of GDP.
- 2019, 19.9% of GDP.
- 2020, 19.9% of GDP.
- 2021, 19.9% of GDP.
Requires the passage of a Balanced Budget Amendment before raising the nation’s debt limit.
DEBT CEILING INCREASE CONTINGENT ON BBA
Provides for the President’s request for a debt ceiling increase if a qualifying Balanced Budget Amendment passes Congress and is sent to the states for ratification.
Q&A: The Cut, Cap, and Balance Act of 2011
How much is the first year spending cut in the “cut” portion of the bill?
- The legislation reduces spending by $111 billion in FY 2012.
Why $111 billion?
- This savings total meets the promise to enact immediate spending cuts as part of any debt ceiling bill, and would cause the deficit to finally get back down below $1 trillion next year (a reduction to the previous year’s deficit of more than $400 billion).
Does the legislation make any changes to Social Security or Medicare?
Does the legislation make any changes to veterans spending?
What does the legislation mean for defense spending?
- It is at the same level as the House-passed FY 2012 budget.
Why cap spending at 19.9% of GDP?
- This would place spending in line with average spending over the last 30 years.
What are the details of the Balanced Budget Amendment?
- The legislation would require that any Balanced Budget Amendment include the following:
- A balanced budget component;
- A super-majority requirement to raise taxes; and
- A limit on spending as a percentage of GDP.
What is the process for the debt ceiling being increased?
- Provides for the President’s request for a debt ceiling increase if a Balanced Budget Amendment passes Congress and is sent to the states for ratification.
Why $2.4 trillion debt ceiling increase?
- The President has requested that the debt limit increase by this amount. This amount is less than the amount of the spending cuts in this bill. A debt limit increase of this magnitude is a major sacrifice on the part of House Republicans, which is why it is made contingent on measures to ensure that the federal budget is permanently under control.
For more information, contact Mike Jerman in Rep. Chaffetz’ office at email@example.com or at 225-7751
For additional information, contact:
The House Republican Conference Policy Office