GOP Group Proposes $2.5 Trillion in Federal Budget Cuts Over Next Decade

CBS
CBS

The Republican Study Committee, a GOP House caucus made up of 165 conservative members, on Thursday released a proposed set of federal budget cuts that would reduce federal spending by $2.5 trillion over the next decade.

The proposal hinges on cutting non-security discretionary spending to 2006 levels through 2021, starting in the 2012 fiscal year. In addition to eliminating automatic increases for inflation, the committee proposes $330 billion worth of cuts to a long list of government-subsidized entities - including Medicaid, the Department of Energy, the National Endowment for the Arts, the National Endowment for the Humanities, the Legal Services Corporation, the Corporation for Public Broadcasting and the U.S. Agency for International Development.

The RSC's plan comes amid a Republican push to reduce federal spending which has thus far been relatively thin on details, in part out of fears of blowback for cutting popular programs.

The plan calls for an $80 billion cut to the current continuing resolution that will fund the government through the rest of the 2011 fiscal year. It also prohibits the expenditure of any federal funds to either carry out the health care reform bill or defend it against legal challenges.

The larger goal, which is slated for "rest of the ten-year budget window," involves eliminating or reducing funding for government programs, privatizing Fannie Mae and Freddie Mack, cutting "all remaining 'stimulus' funding," and eliminating 15 percent of the federal workforce through a process of attrition. That means for every two federal employees who leave their positions, only one will be replaced.

When asked by The Hill how privatizing Fannie and Freddie could be achieved "without devastating the housing market," Scott Garrett, RSC member and Chairman of the Financial Services Committee's subcommittee on Capital Markets and Government-Sponsored Enterprises, said the key was avoiding bailouts of the companies in the future.

"First and foremost, what we need to do with Fannie and Freddie is to make sure that the American public is no longer on the hook going forward. We are already on the hook or out of pocket to the tune of $150 billion or a little less than that already," he said. "I was just meeting with some of the regulators, and their projections is that there will be more times when they will be coming back to you and I asking for more money to bail them out."

A spokesperson for House Speaker John Boehner, Michael Steel, was not clear on whether Boehner supported the plan. Steel told the Huffington Post that "our immediate goal [is] to cut spending to pre-bailout, pre-stimulus levels," but added that "that will be the beginning, not the end, of our efforts to cut spending and create jobs."

"I applaud the Republican Study Committee for proposing cuts in federal spending, and I look forward to the discussion on reducing spending that our country so desperately needs to have," House Majority Leader Eric Cantor added in comments tothe Huffington Post. "As promised, we will have an open process when it comes to spending bills. I look forward to these cuts and others being brought to the floor for an up-or-down vote during consideration of the CR, and I support that effort."

Watch CBS News' Bob Orr's interview with Republican Study Committee member Rep. James Lankford (R-Okla.) on Friday's Washington Unplugged here