The so-called "Penny Plan" would, according to its sponsors, balance the federal budget in two years by using just a 1 percent reduction in spending.
The lawmakers are pitching the plan in the simplest terms -- cutting a penny from every dollar the government spends so that spending will soon equal revenue. They cast the plan as a pick-and-choose alternative to the sequester's across-the-board budget cuts.
"Everybody should be able to live with one percent less in order to help bring this country back from the brink of catastrophic failure," bill sponsor and Wyoming Republican Sen. Mike Enzi said in submitting the legislation just before August recess.
Enzi is joined by fellow GOP Sens. Rand Paul, of Kentucky; John Barrasso, of Wyoming; Jim Risch, of Idaho; David Vitter, of Louisiana; Johnny Isakson, of Georgia; and Marco Rubio, of Florida.
Republican Georgia Rep. Austin Scott introduced similar legislation in the House.
Senate sponsors warn that federal spending over the past 11 years has increased from 18 percent of the country's GDP to nearly 23 percent. And without intervention, they say, the national debt will go from roughly $16 billion to $25 billion by 2023, increasing interest payment so much that balancing the budget will go "beyond the reach of Congress."
The 1 percent cut would last two years, followed by a cap on total annual spending -- equal to roughly 19 percent of GDP. Supporters say it also will cut spending over roughly 10 years by about $5.8 trillion, based on currently projected levels.
For the full story: http://www.foxnews.com/politics/2013/08/07/hill-republicans-revive-penny-plan-as-sequester-alternative-to-balance-budget/
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