REDUCE Legislation Aims to Cut Deficit by $70 Billion
Today, four Democratic congressmen—Reps. Gary Peters, John Adler, Jim Himes, and Peter Welch—introduced four-pronged legislation, called the REDUCE Acts, meant to reduce the national deficit by more than $70 billion over the next decade. This series of bills proposes to achieve this goal through a combination of reduced spending and the elimination of “inefficient programs and costly industry subsidies.”
Each of the four congressmen has spearheaded one of the proposals within this legislation. Rep. Peters is sponsoring the energy portion, which will most notably eliminate tax loopholes for oil giants, stop the expansion of the strategic petroleum reserve, and sell federally-owned energy facilities to private utility companies—which Peters claims will save the government almost $4 billion in 2011 and almost $60 billion over 10 years.
Rep. Adler is sponsoring the Treasury and housing component. Including the implementation of electronic payroll for Treasury employees, and the elimination of the rarely-used Advanced EIC, and the Overseas Private Investment Corporation (which subsidizes U.S. companies’ investment abroad), this is estimated to save $169 million in 2011 and $3.7 billion over 10 years. Rep. Himes focuses on agriculture, proposing cuts to private agriculture subsidies and the reduction of commodity payments to wealthy farmers. He also proposes reductions in the federal reimbursement rate for private crop insurers, saving in total about half a billion dollars in 2011 and just over $6 billion in 10 years.
Finally, Rep. Welch’s defense cuts include the termination of three systems which the Defense Department supports eliminating, saving $2.6 billion in 2011 and at least $4.1 billion over the next decade.
The hard work of these four congressmen in drafting this plan only highlights the increasing importance we must place on finding specific ways to bring down deficits as the economy recovers. Those who disagree with the specifics of these bills should step forward with their own proposals for how to reduce deficits over the medium-term.
We eagerly await the future of the REDUCE bills.