This afternoon on the radio, Rep Connie Mack talked about the “One Percent Spending Reduction Act," legislation – also known as the "Penny Plan" – that was introduced by Senator Mike Enzi (R-WY) last week, and authored by Congressman Connie Mack (R-FL) last spring in the U.S. House of Representatives.
The Penny Plan balances the budget by:
• Cutting total federal spending by one percent each year for six consecutive years,
• Setting an overall spending cap of 18 percent of gross domestic product in 2018, and
• Reducing overall spending by $7.5 trillion over 10 years.
If Congress and the President are unable to make the necessary cuts, the bill’s fail-safe triggers automatic, across-the-board cuts to ensure the one percent reductions are achieved.
This plan makes perfect sense and will dig us out of the financial hole we’re in. But Mack said that the House was unwilling to even vote on the plan. I can only guess it’s because this plan actually has some teeth and Congress isn’t serious about solving the debt crisis.
The Boehner plan on the other hand, calls for cuts, but they’re not actual reductions in current spending, but rather cuts to the automatic increased spending that’s part of Congress’ baseline budgeting. If passed, the “cuts” are to be made over the next 10 years, which would NOT decrease the annual deficit, would continue to increase the national debt, and aren’t likely to ever happen at all if a future Congress doesn’t want to implement them.