The Deficit Reduction Process
Overview
The U.S. currently has a debt of over $14.7 trillion. By law, Congress must raise the debt ceiling in order to avoid a default. On July 31, 2011 Congress reached a bipartisan deal that lifted the federal debt limit in two stages by at least 2.1 trillion dollars.
The Budget Control Act increased the debt ceiling by $400 billion in August 2011, and required the federal government to make $917 billion in spending cuts over a ten-year period as a first installment toward a total of $2.1 trillion in deficit reduction over 10 years.
The next installment, $1.5 trillion, is to be decided through future legislation being drafted by the Joint Select Committee on Deficit Reduction, or “supercommittee.” The committee will have until Nov. 23 to propose ways to reduce deficits. Those proposals must be voted on in Congress by Dec. 23.
If the committee process fails to produce a debt reduction plan, up to $1.2 trillion in across-the-board cuts would kick in - evenly divided between defense and non-defense spending. This would take place through a process called sequestration.
Supercommittee Membership
The joint committee consists of 12 members selected by the congressional leadership, with three each of Democratic senators, Republican senators, Democratic representatives and Republican representatives, and co-chairs appointed by the House speaker and Senate majority leader. The members are:
Rep. Jeb Hensarling (R-Texas), Co-Chair
Sen. Patty Murray (D-Wash.), Co-Chair
Sen. Max Baucus (D-Mont.)
Rep. Xavier Becerra (D-Calif.)
Rep. Dave Camp (R-Mich.)
Rep. Jim Clyburn (D-S.C.)
Sen. John Kerry (D-Mass.)
Sen. Jon Kyl (R-Ariz.)
Sen. Rob Portman (R-Ohio)
Sen. Pat Toomey (R-Pa.)
Rep. Fred Upton (R-Mich.)
Rep. Chris Van Hollen (D-Md.)
Timeline
October 14: House and Senate committees may make their recommendations to the supercommittee on how to reduce the deficit.
November 23: The supercommittee must vote to put forward its debt-reduction proposal. A majority vote is required for the plan to be approved.
December 2: If the proposal passes the supercommittee, the panel must submit its report and legislative language to the White House and congressional leaders by this date.
December 9: Any House or Senate committee to which the supercommittee bill is referred must report it to the full House, as favorable, unfavorable, or with no recommendation. Committees may not make amendments.
December 23: The House and Senate must vote on passage of the supercommittee bill no later than this date. The bill is subject to a simple up or down vote in Congress - without any amendments or House “majority of the majority” blocks or Senate filibusters possible.
January 15, 2012: Deadline for the President to sign a passed bill or the “trigger” leading to $1.2 trillion of future spending cuts goes into effect starting in 2013, if the committee’s legislation has not been enacted.
January 31, 2012: Supercommittee is dissolved.
