Senate Majority Leader Harry Reid introduced the Senate Democrats’ plan to raise the debt limit and lower the deficit in a press conference Monday afternoon.
Reid’s plan would raise the debt limit through the end of 2012, while cutting the deficit by $2.7 trillion.
His deficit reduction package would not include entitlement reform or tax increases, but includes $1 trillion in savings from the wars in Iraq and Afghanistan.
$1.2 trillion would come from cuts to discretionary spending, while another $400 billion would come from interest savings. The plan does not detail where the discretionary program savings would come from.
Reid added that all of the spending cuts he included have previously been endorsed by Republicans.
He said he would put his plan on the Senate floor today.
The full plan is below:
Details Of The $2.7 Trillion Senate Democratic Package:
$1.2 Trillion in Discretionary Spending Cuts. The $1.2 trillion in discretionary spending cuts include both defence and non-defence spending. Before Speaker Boehner broke off talks with the White House on Friday, he had already agreed to $1.2 trillion in discretionary spending cuts.
$100 Billion in Mandatory Savings. The proposal includes $100 billion in mandatory savings that were negotiated by Democrats and Republicans participating in the negotiations led by Vice President Biden. These savings will not impact Medicare, Medicaid, or Social Security benefits in any way. The mandatory savings will include:
$40 billion in Program Integrity Savings. The proposal saves $40 billion by reducing fraud and abuse in mandatory programs. This includes: Continuing Disability Reviews and SSI redeterminations, Internal Revenue Service tax enforcement, health care fraud and abuse control, and Unemployment Insurance improper payment reviews.
- $30 Billion In Fannie Mae/Freddie Mac Reforms.
- $15 Billion In Spectrum Sales
- $10 -15 Billion In Agricultural Reforms
- Higher Education Program Reforms Whose Savings Go To Sustain The Pell Grant Program
$1 Trillion in Savings From Winding Down the Wars in Iraq and Afghanistan. Winding down the wars in Iraq and Afghanistan will save $1 trillion. Paul Ryan’s budget also included this savings in its deficit reduction calculation, which was supported by 235 House Republicans and 40 Senate Republicans.
$400 Billion in Interest Savings. The package includes $400 billion in interest savings, $220 billion from the discretionary spending cuts and $180 billion from winding down the wars in Iraq and Afghanistan. Both the Ryan budget and the House Cut, Cap and Balance plan similarly included interest savings in their total calculation.
Establishes Joint Congressional Committee to Find Future Savings. In addition to $2.7 trillion in concrete savings, the Senate package will establish a joint, bipartisan committee, made up of 12 members, to present options for future deficit reduction. The committee’s recommendations will be guaranteed an up-or-down Senate vote, without amendments, by the end of 2011.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.