The President's Budget to the Chairman's Plan
April 6, 2011
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House GOP Budget Plan Proposes Dramatic Spending Cuts and Policy Changes
On April 5, House Budget Committee Chairman Paul Ryan (R-WI) released “Path to Prosperity,” his budget proposal for FY2012, with projections through FY2021. The plan cuts $6.2 trillion in spending over the next decade from the budget projections released with President Obama's proposed budget for FY2012.
NPP provides a two-page analysis of the Chairman's proposal, looking at the proposed cuts in FY2012, long-term funding, deficit projections and significant proposed policy shifts for major federal programs like Social Security and Medicare.
Highlights of Chairman Ryan's Plan
- Places a five-year cap on "non-security" discretionary spending at 2008 levels
- Ties the cap on total annual "non-security" discretionary spending to a percentage of Gross Domestic Product (GDP) that would be enforced by across-the-board cuts to "non-security" funding if spending exceeds the prescribed percentage of GDP
- Exempts "security" spending from the discretionary cap, and provides real growth in "security" funding for each fiscal year for the next decade, adding a total of $214 billion in new funding
- Reduces top income tax rates for corporations and individuals from 35 percent to 25 percent
- Adds $5.1 trillion to the federal debt through 2021, an average of 71.6 percent of Gross Domestic Product (GDP) annually
- Reduces the FY2012 deficit only by approximately 15 percent despite significant program cuts
- Proposes significant cuts and policy reform within the major entitlement programs – Social Security, Medicare and Medicaid