WASHINGTON – U.S. Senator Bob Corker, R-Tenn., said the long-term budget outlook released today by the Congressional Budget Office underscores the need for Congress to put in place a fiscal straitjacket like the CAP Act.
The report is available at: http://www.cbo.gov/ftpdocs/122xx/doc12212/06-21-Long-Term_Budget_Outlook.pdf.
“Today’s long-term budget outlook from the non-partisan Congressional Budget Office, widely considered the most realistic estimate of our country’s fiscal future, reinforces the fact that we cannot let this seminal moment pass us by without putting in place an enforceable mechanism like the CAP Act to slash unsustainable spending. Even with revenue returning to historical norms, our current spending path will more than double our public debt in the next ten years, adding $12.5 trillion in additional debt to our balance sheet,” Corker said.
The CAP Act, S. 245, would, for the first time, set an across-the-board, binding cap on all federal spending. The fiscal straitjacket created by the CAP Act would result in $7.6 trillion less spending over a 10 year period. Specifically, the bill would:
(1) Put in place a 10-year glide path to cap all spending – discretionary and mandatory – to a declining percentage of the country’s gross domestic product, eventually bringing spending down from the current level, 24.7 percent of gross domestic product, to the 40-year historical level of 20.6 percent, and
(2) If Congress fails to meet the annual cap, require the Office of Management and Budget to make evenly distributed, simultaneous cuts throughout the federal budget to bring spending down to the pre-determined level. Only a two-thirds vote in both houses of Congress could override the binding cap, and
(3) For the first time, eliminate the deceptive “off-budget” distinction for Social Security – providing a complete and accurate assessment of all federal spending.
The growing list of Senate sponsors of the CAP Act includes Bob Corker (R-Tenn.), Claire McCaskill (D-Mo.), Lamar Alexander (R-Tenn.), Kelly Ayotte (R-N.H.), Richard Burr (R-N.C.), Saxby Chambliss (R-Ga.), Mike Crapo (R-Idaho), John Hoeven (R-N.D.), Jim Inhofe (R-Okla.), Johnny Isakson (R-Ga.), Ron Johnson (R-Wis.), Mark Kirk (R-Ill.), Jon Kyl (R-Ariz.), Joe Lieberman (ID-Conn.), Joe Manchin (D-W.V.) and John McCain (R-Ariz.).
Representatives Jim Cooper (D-Tenn.) and Jimmy Duncan (R-Tenn.) have introduced a companion version of the bill in the House.