1.This Act may be cited as the Targeted Deficit Reduction Act of 2010
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2.Congress finds that—
(1)the Federal deficit in 2009 was more than $1.4 trillion, or 9.9 percent of the United States gross domestic product (GDP);
(2)our current deficits are unsustainable: under realistic assumptions, the level of public debt will double over the next ten years;
(3)the Federal debt held by the public at the end of 2009, as estimated by the Congressional Budget Office (CBO), was approximately $7.5 trillion or 53 percent of GDP;
(4)in a conservative CBO estimate assuming tax cuts will expire by 2012, the debt will climb to $15 trillion by the end of 2020, or 67 percent of GDP;
(5)other analysts, which take account many factors that the CBO does not utilize, estimate that by 2020 publicly held debt will be closer to 80 percent of GDP;
(6)in 2009, payment of interest on the national debt was the fourth largest item in the Federal budget, reducing funds available to vital programs such as education, homeland security, and veterans affairs;
(7)United States debt held by foreign individuals and nations whose interests are not always compatible with United States interests has grown dramatically: at the close of 2009 overseas ownership of United States securities totaled nearly $3.6 trillion and nearly $800 billion was held by China;
(8)creditors’ willingness to lend to the United States is decreasing, which greatly restricts the ability of the Nation to respond to crises, both foreign and domestic;
(9)a growing debt directly increases inflation, further eroding the power of the United States dollar abroad and weakening the economy;
(10)succeeding generations will face greatly lower standards of living because of the fiscal future created by prolonged deficit spending;
(11)international trade has made the United States economy the largest in the world, but tightened credit and weakened international standing will reduce the Nation’s ability to compete in a global marketplace and will restrict the growth of the economy;
(12)the United States supplies the International Monetary Fund (IMF) with a great deal of its funding and is a leader in formulating IMF economic policies that are promoted through the world, yet the United States is dangerously close to exceeding the IMF guideline limit of 60 percent debt-to-GDP;
(13)without a significant commitment to rein in our deficits and debt, our economic and national security will be threatened;
(14)the Federal budget should be developed each year toward a target of attaining a maximum ratio of 60 percent debt-to-GDP and achieving complete budget balance within ten years (by fiscal year 2020);
(15)an interim goal, the Federal budget should achieve primary balance, in which spending equals revenue excluding the debt service, within five years (by fiscal year 2015);
(16)the reconciliation process is currently an optional procedure under the Congressional Budget and Impoundment Control Act of 1974 (Public Law 93–344), as amended) designed to enhance the ability of Congress to reduce the deficit; and
(17)this Act creates achievable, long-term goals and imbeds a process for annual progress toward that goal in the Congressional budgetary process.
3.Targeted deficit and debt reduction
(a)Title III of the Congressional Budget Act of 1974 is amended by adding at the end the following new section:
316.Targeted deficit and debt reduction
(a)Content of concurrent resolution on the budgetIn addition to the items required to be included in a concurrent resolution on the budget under section 301(a), the concurrent resolutions on the budget for fiscal years 2011 through 2020 shall each include, as applicable, reconciliation directives described in section 310 to reduce the deficit to achieve the goals set forth in subsection (b).
(b)Goals To be achieved through reconciliation
(1)Primary budget balance by fiscal year 2015.
(2)Full budget balance by fiscal year 2020.
(3)A debt-to-GDP ratio of 60 percent by fiscal year 2020. Any committee that receives reconciliation directives to achieve any of these goals shall be ordered to report a reconciliation bill not later than 45 calendar days after the concurrent resolution on the budget containing such directives is agreed to.
(c)On or before February 15 of each year through 2019, the Director of the Congressional Budget Office shall submit to the Committees on the Budget of the House of Representatives and the Senate a report for the fiscal year commencing on October 1 of that year containing the target deficit reduction for that fiscal year necessary to achieve the applicable goals set forth in subsection (b) and the anticipated glide path for each such fiscal year until fiscal year 2020. In determining the necessary deficit reduction required for each fiscal year through fiscal year 2020, the Director shall endeavor to have such deficit reduction as uniform as possible for each such fiscal year. Each such report shall also include the estimated deficit, debt, and GDP for each fiscal year though fiscal year 2020.
(d)For purposes of this section—
(1)the term primary budget balance
means outlays equal receipts during a fiscal year, not counting outlays for debt service payments;
(2)the term full budget balance
means outlays equal receipts during a fiscal year;
(3)the term GDP
means the gross domestic product of the United States; and
(4)the term debt-to-GDP ratio
means, for a fiscal year, the quantitative relationship between the face amount of obligations described in section 3101(b) of title 31, United States Code, estimated to be outstanding at the end of that year and the estimated GDP for that year. .
(b)The table of contents set forth in section l(b) of the Congressional Budget and Impoundment Control Act of 1974 is amended by inserting after the item relating to section 315 the following new item:
Sec. 316. Targeted deficit and debt reduction. .