Isakson Pushes Bill to Reduce Federal Spending

Co-Sponsors Commitment to American Prosperity (CAP) Act

Feb 01, 2011

WASHINGTON – U.S. Senator Johnny Isakson, R-Ga., today joined a bipartisan group of his Senate colleagues in co-sponsoring the Commitment to American Prosperity Act, or the “CAP Act,” to significantly reduce total federal spending – both mandatory and discretionary spending – over the next 10 years through limits and caps.

Specifically, the “CAP Act” would establish federal spending limits that will be gradually reduced over 10 years to 20.6 percent of the nation’s gross domestic product, the historical average of federal spending.

“We must get back to a point of fiscal sanity in Congress. American families have had to live within their means and it is time that the federal government does the same. Some in Washington want to cherry-pick ways to cut spending whereas I believe we need a macro approach if we are truly serious about reducing spending,” said Isakson. “This bill is a long-term, macro approach that would serve as a guide to accomplish the goal of ending the spending spree that is currently plaguing our country.”

The “CAP Act” was introduced by U.S. Senators Bob Corker, R-Tenn., and Claire McCaskill, D-Mo., and cosponsored by Isakson as well as Senators Lamar Alexander, R-Tenn., Richard Burr, R-N.C., Saxby Chambliss, R-Ga., Jim Inhofe, R-Okla., Mark Kirk, R-Ill., and John McCain, R-Ariz.

In fiscal year 2009, the federal government had a deficit of $1.4 trillion, borrowing almost 40 cents of every dollar. The gap between spending and revenue is almost four times the historic average. Even when the United States reaches historic revenue levels, we are still projected to be spending nearly 6 percent more of our gross domestic product than we take in, and the gap will continue to widen. By 2035, on our current trajectory, U.S. debt will reach 185 percent of GDP.

The “CAP Act” would, for the first time, eliminate the deceptive “off-budget” distinction for Social Security – providing a complete and accurate assessment of all federal spending. The legislation would also put in place a 10-year glide path to cap all spending (discretionary and mandatory) at a declining percentage of the country’s gross domestic product, eventually bringing spending down to the historical average of 20.6 percent of GDP, and if Congress fails to meet the annual cap, authorize the Office of Management and Budget to make evenly distributed, simultaneous cuts throughout the federal budget to bring spending down to the pre-determined level. Only a two-thirds vote in both houses of Congress could override the binding cap.