(USNewsMag.com) – The Dollar-For-Dollar Deficit Reduction Act was proposed March 1. The proposed legislation requires proposals to Congress for raising the debt ceiling to include proposals which would reduce spending at the same amount over a period of 10 years.
The proposed legislation requires the Treasury must inform both the Senate Finance Committee and the House Ways and Means Committee 60 days prior to a date of potential default for debt. It also requests transparency about the measures being used to not to default on the debt.
Ways and Means Committee member and Iowa Rep. Randy Feenstra along with Senate Republican Conference chairman and Wyoming Sen. John Barrasso introduced the proposed legislation. At a later date, Barrasso is expected to introduce similar legislation in the Senate.
While Republicans have said they want to cut spending as part of the debt ceiling negotiations, this is one of the first pieces of legislation to unveil a plan to do so.
On Feb. 28 a plan was also unveiled by House Republicans to reduce spending by restricting earmarks for discretionary spending in appropriations bills to no more than half of a percent. Earmark dollars for individuals or entities would be scrutinized. Also, in annual appropriations bills earmark dollars would not be able to be requested for the Defense, Labor, and Health and Human Services Departments.
The proposed pieces of legislation are in response to a warning that the U.S. had reached its debt ceiling limit of $31.4 trillion debt ceiling by Treasury Secretary Janet Yellen. She said the Treasury was using “extraordinary measures” to pay its obligations such as Medicare and Social Security.
In response to the warning, Democrats have asked for a clean debt ceiling increase while Republicans are asking for spending cuts to be included as part of any proposals to raise the debt ceiling.
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