Sen. Pat Toomey, Pennsylvania Republican, released his “balanced budget proposal” on Tuesday afternoon.
“I’m not aware of any country that has ever dramatically grown its government, generated massive spending beyond its means, run up huge deficits, accumulated massive debt, monetized part of it and then lived happily ever after,” Toomey said. “We won’t be the first. We’re either going to stay on this current path and suffer the consequences that will come from this very irresponsible spending – the consequences of diminished opportunity at best – or we’re going to depart from this path and adopt the fiscal discipline that our constituents expect of us and adopt the pro-growth reforms that will allow our economy to recover and allow us to enjoy another great American century.”
The plan, according to Toomey, balances the budget by 2020 with a “modest surplus” in 2021, reduces publicly-held debt to about 52 percent of Gross Domestic Product (GDP) by 2021 and lowers spending to 18.5 percent of GDP.
Toomey said the plan also repeals Obamacare taxes, spending and entitlement programs, but spends more on Medicare then the president’s budget and the House budget, which House Budget Chairman Rep. Paul Ryan of Wisconsin proposed.
According to a release, the plan makes Medicaid a block grant to individual states, meaning each state would be able to spend its Medicaid money as it sees fit. The plan also reduces non-defense discretionary spending to 2006 levels, or $435 billion in 2012, and freezes it at that level for the next six years. After that, non-defense discretionary spending indexes to the consumer price index (CPI).
Toomey’s plan uses Defense Secretary Robert Gates’ recommendation to slow the growth of defense spending, and assumes the full withdrawal from Iraq and Afghanistan by 2018.
For mandatory welfare spending, Toomey’s budget plan reduces it to slightly-higher-than-2007 levels by 2014, after which they grow in accordance with the CPI.
Republican Sens. Jim DeMint of South Carolina, Marco Rubio of Florida, Tom Coburn of Oklahoma, Richard Burr of North Carolina, David Vitter of Louisiana, Ron Johnson of Wisconsin, Mike Lee of Utah, and James Risch of Idaho have all signed on as co-sponsors of Toomey’s budget plan.