US Senate News:
Source: United States Senator for Kentucky Rand Paul
FOR IMMEDIATE RELEASE:
September 25, 2024
Contact: Press_Paul@paul.senate.gov, 202-224-4343
Dr. Rand Paul Forces Vote on Six Penny Plan to Balance the Federal Budget in Five Years
Senate Votes 39-56 on Dr. Paul’s Six Penny Plan
WASHINGTON, D.C. – Today, U.S. Senator Rand Paul (R-KY) forced the Senate to vote on his “Six Penny Plan” federal budget that will balance within five years. Dr. Paul spoke on the Senate floor ahead of the vote, below are excerpts from his remarks.
“This year, the United States will spend over $6 trillion while only bringing in $4 trillion in revenue. That’s a profound gap, $2 trillion will be borrowed this year. To add insult to injury, Congress spends like drunken sailors without even bothering to pass a budget…In fact, over the past 20 years, Congress has passed a budget less than half the time. So, today, I will attempt to do what both parties have failed to do and that is pass a budget…The Penny Plan that I offer today will balance the budget in 5 years.
“Americans will pay dearly for Congress’s insatiable appetite for more and more spending. The high level of spending that is currently crushing the American family is just the beginning. If we continue down this unsustainable path, American families will be forced to deal with even higher inflation, confiscatory tax rates, rising interest rates, and a weak economy. It will be harder to find a job and provide for a family because the deals made in the halls of Congress always stick the taxpayers with the bill.
“As interest payments on the national debt crowd out the rest of the government’s budget, tax increases, inflation, and an eventual default on the debt are what lie ahead for the American economy. Unfortunately, a debt crisis will not just stop with our economy. A threat to our financial security is also a threat to our national security.
“Even the Biden-Harris Administration’s own Treasury has admitted that our current path is unsustainable. The math is clear, and I urge my colleagues: do not get in an argument with math. You will lose.
“Our current trajectory weakens our national security and drains productivity from our economy. History will remember those who had the courage to make the hard choices now and who chose to leave their children with less of the burden. For just six pennies on the dollar, we can reverse this dismal trajectory. In just five years, we can restore trust in the U.S. dollar, the U.S. economy, and walk the U.S. government off the fiscal cliff. Vote yes on this plan, vote yes on restoring fiscal sanity, vote yes on securing a future for our country.”
You can watch Dr. Paul’s full floor remarks HERE and HERE.
Background:
The Six Penny Plan is a federal budget resolution that will balance on-budget outlays and revenues within five years by cutting six pennies off every dollar projected to be spent in the next five fiscal years. This plan is the most recent in a series of plans that Dr. Paul has introduced to address an ever-worsening budget crisis:
In the 100 days between CBO’s February and June budget baselines, the federal government added an additional $540 billion to the national debt (an additional $1,600 per U.S. citizen).
CBO’s June estimates increased projected deficits by $2.5 trillion over CBO’s February estimates.
Interest payments on the debt account for more spending than our entire defense budget.
At over $35 trillion, the national debt is nearly double the amount of total bank deposits in the U.S. In other words, emptying every bank account in the U.S. would only cover half of the government’s debt.
In 2017, Dr. Paul introduced a budget that would have only required a spending freeze to balance in five years. An annual six percent cut is now required to achieve the same results. Dr. Paul’s Six Penny Plan implements these cuts while preserving congressional discretion regarding how to achieve these spending targets. This plan would:
Reduce spending by $329 billion in the first year. The plan would continue to cut six percent until balance in year five, then allows spending to rise with the pace of revenues in the five years remaining.
Make no specific policy assumptions. All savings are reflected in the newly defined budget function 930: New Efficiencies, Consolidations, and Other Savings. The budget sets a goal of balance and then calls on Congress to make the changes needed to achieve this objective.
Assume the 2017 Tax Cuts and Jobs Act is made permanent (originally set to expire in 2027). Since CBO originally assumed this would expire and federal revenues would increase, this plan accounts for the decrease in projected revenues if TCJA were to be made permanent.
You can read the Six Penny Plan HERE.
Dr. Paul’s Six Penny Plan has wide support:
“For decades, the government has spent beyond its means and expected hardworking taxpayers to foot the bill. This reckless spending in Washington has delivered nothing but record inflation, leaving the American people unable to make ends meet. It’s past time for Congress to make the hard decisions required to put our financial house back in order. Heritage Action thanks Sen. Paul for his consistent support for fiscal responsibility and backs his ‘Six Penny Plan’ to balance the budget,” said Ryan Walker, Executive Vice President of Heritage Action.
“The Council for Citizens Against Government Waste supports Sen. Paul’s amendment to cap spending for five years and achieve a balanced budget. His proposal to cut spending by 6 percent annually should be supported by every senator who believes in fiscal responsibility and getting the nation back on the right track,” said Tom Schatz, President of Council for Citizens Against Government Waste.
“Senator Paul has been a true pioneer in new concepts for fiscal responsibility, with his first introduction of a Penny Plan to balance the budget back in 2017. At the time, achieving eventual balance would have only required cutting 1 cent per dollar of federal spending. However, due to continued reckless policies, a Six Penny Plan, requiring annual 6 percent savings to tackle deficits, is now necessary. Senator Paul’s legislation also locks in the pro-growth Tax Cuts and Jobs Act, preventing tax hikes on top of inflation. Also important, the Six Penny Plan wisely proposes scorekeeping reforms to identify duplicate programs in new proposals and strengthened budget enforcement in the Senate. Taxpayers can only hope that Congress acts swiftly on the Six Penny Plan, so Senator Paul won’t need to introduce a Dime Plan or, worse, a Quarter Plan,” said Demian Brady, Vice President of Research, National Taxpayers Union Foundation.
“Senator Rand Paul has been fighting for fiscal responsibility and raising the alarm on federal spending with his Penny Plan since 2017. Had Congress listened to Sen. Paul and passed his plan, the country would have a balanced budget today. Instead, Congress continues to exacerbate inflationary pressures with unprecedented and obscene spending levels. As President of the Taxpayers Protection Alliance, I thank Senator Rand Paul for this commonsense and much-needed solution to balance the budget and protect taxpayers,” said David Williams, President of Taxpayers Protection Alliance.
“Citizens for Renewing America supports Senator Rand Paul’s Six Penny Plan, which offers a real solution to years of reckless spending policies. As Congress continues to avoid addressing the root causes of our growing national debt, Senator Paul’s plan forces genuine cuts to the woke and weaponized federal bureaucracy. This legislation is critical to restoring the fiscal sanity that Washington has sorely lacked and provides the necessary course correction to years of flawed policies that have failed to reduce our national debt or deficits,” said Wade Miller, Executive Director of Citizens for Renewing America.
“Unfortunately, the Biden Administration continues to advocate for inflationary spending plans that would add to the crushing tax burden faced by hardworking Americans. As we face the real threat of stagflation for the first time since the 1970s, we need a major course correction from policymakers in Washington. Senator Rand Paul should be commended for his bold approach to address our $35 trillion national debt, while avoiding economically damaging tax increases. Sen. Paul’s common sense spending reforms put our hardworking taxpayers first by addressing the root cause of our national debt: overspending,” said Jonathan Williams, ALEC Chief Economist and Executive Vice President of Policy.
“Unsustainable federal spending is driving the bloated national debt and contributes to economic weakness and elevated inflation, so I applaud Senator Paul’s Six Penny Plan to get control of the spending crisis,” said Vance Ginn, Ph.D., President of Ginn Economic Consulting and former Chief Economist of Trump White House OMB.
“Senator Rand Paul has long been a champion of balancing the federal budget and protecting the American taxpayer. Senator Paul has a plan that will balance the budget in five years. Interestingly, if Congress had voted for Senator Paul’s plan five years ago, we would not be suffering runaway inflation, economic downturns, slowdowns, severe shortages, and empty shelves at the store. And we’d be celebrating a balanced budget too! And balancing the budget has national security benefits as well. If we wait even longer to take action, we will suffer more inflation, larger and larger deficits, and more economic instability and our national security will slide downhill as well. And then it will take much larger cuts to get things back on track. So now is the time to act before the problem becomes so large that it cannot practically be fixed,” said George Landrith, President of Frontiers for Freedom.
“Senator Rand Paul is one of the few Senators who are serious about the fiscal challenges facing America. Quite simply, the current rate of government spending is unsustainable with interest payments on the debt for the first ten months of fiscal year 2024 reaching a staggering $763 billion fully $202 billion more than the same period the previous year. Net interest payments on the debt surpass every other spending category other than Social Security. It is astonishing that the fiscal apocalypse that we have worried about for decades is now upon us with even defense spending dwarfed by the cost of simply making interest payments on our $35 trillion national debt. Senator Paul’s Six Penny Plan forces an honest discussion about the crisis our nation faces and some of the tough decisions which will be required to reverse course from the almost $2 Trillion in debt our country adds onto the ledger every single year. Higher interest rate payments on more of the debt combined with the spending spree which has raised the debt from $26.9 Trillion on September 30, 2020 to more than $35 Trillion. America is in trouble and Senator Paul is one of the few members of Congress willing to propose solutions,” said Richard Manning, President of Americans for Limited Government Foundation
MIL OSI USA News –