Today Rep. Paul Ryan (R-Wis.) reveals his balanced budget to the Senate and Congress with a ten year time stamp and “an exit ramp from the current mess.” The Senate is expected to present their balanced budget proposal later this week, and it is estimated that the President will provide his balanced budget in April or May.
Paul Ryan challenges entitlement programs, the tax code, federal spending and the deficit for a balanced budget in a decade. This is the third year Ryan is presenting the proposal as chairman of the House Budget Committee. The key difference about this budget than previous versions is the time boundary of ten years is proposed to balance the budget. The balanced budget proposal does not increase taxes and decreases the levels of projected spending.
Ryan has reported, “The reason we do a balanced budget is not to make the numbers simply add up. It leads to a healthy, growing economy that creates jobs. It’s a means to an end. And the means is to get to a good, growing economy to create jobs and opportunity.”
5 Key elements of the Proposed Balanced Budget
1. 10 year time stamp
2. Cut projected spending by $5.7 Trillion
3. Medicare private purchase Option
4. Top Tax Rate reduced to 25 percent
5. Medicare changes impacts individuals 54 and younger
The current economic environment has an alarming unemployment rate. The current unemployment rate for February is 7.9%. This is the lowest it has been since 2008, but it does not represent the annual rate for 2013. Throughout the years, the unemployment rate has significantly increased from 5.8% in 2008 to 9.3% in 2009 and peaking to 9.6% in 2010. Although it has been extremely high, it is showing signs of decrease. It has decreased to 8.9% in 2011 and 8.1% in 2012.
With no results for the past year, the government has been discussing how to minimize the effects of this year’s Sequestration resulting in $85 billion in military defense spending cuts. The government has extended obtaining a resolution until the summer as there is no expectation that these initial impacts of cuts will be too drastic. Some of the immediate effects were not deploying Navy ships for overseas missions, tours of the White House were suspended and the cancellation of U.S. Air Force thunderbirds air shows.
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