Here’s a quick-and-dirty summary of the Boehner bill, as it stood on Tuesday afternoon. Note that parts are being reworked to increase the size of the spending cuts, so this is already a bit out of date.
- As initially drafted, CBO projected the plan would cut spending by $850 B over the next decade. That is less than was anticipated, so the Speaker is retooling the bill to meet his dollar-of-spending-cuts-for-dollar-of-debt-increase principle. I think his new goal is $1 T of spending cuts over the next decade. Update: The new version cuts spending $917 B over 10 years.
- These savings come from discretionary spending cuts and a bit from student loans.
- It would create statutory caps on discretionary spending and a sequester to enforce those caps.
- The Secretary of the Treasury would be authorized to increase the debt limit by $900 billion upon enactment.
- It would create a new Joint Select Committee of 12 members of the House and Senate, with three each appointed by Boehner, Pelosi, Reid, and McConnell. The committee’s goal is to reduce the deficit by $1.8 T over the next decade, and to produce a bill that would “significantly improve the short-term and long term fiscal imbalance of the Federal Government.”
- IF seven members of that committee recommend legislation by November 23rd of this year, then that legislation enjoys an expedited “fast track” legislative process in the House and Senate, with votes in both bodies required by December 23rd of this year.
- If that fast track legislation resulting from the new committee is enacted into law and it reduces the deficit by more than $1.6T, the Secretary of the Treasury can raise the debt limit by another $1.6 T.
- The House and Senate would be required to vote on a Balanced Budget Amendment in the fourth quarter of this year (I’m still a bit confused at how a law can require a vote).
- The bill contains no tax increases.
Without too much trouble you can see the conceptual outline of “Cut, Cap, and Balance” within this bill.
I hope this is helpful.