The co-chairs of President Barack Obama's National Commission on Fiscal Responsibility and Reform have released a preliminary proposal to reduce the national deficit by $4 trillion over the next decade.
According to CNN, three quarters of the cuts would be achieved through spending reduction beginning in 2012, while the rest would be accrued through tax revenue. The report from Erskine Bowles and Alan Simpson proposes significant cuts to the defense budget, including a freeze on noncombat military pay at 2011 levels for three years and a reduction in pay to overseas bases by one-third.
In response to the report, the Aerospace Industries Association said the cuts in defense resources will compromise America's security efforts. The group added that history provides examples that cuts in defense spending were followed by the rise of threats that the U.S. was unable to meet.
Outside of the defense cuts, the proposal recommends eliminating 250,000 contractors, saving $18.4 billion, and freezing Federal pay for three years, saving $15.1 billion. In addition, the report aims to alter Social Security by lessening benefits for wealthier recipients and raising the retirement age to 68 by 2050.
The report recommends capping Federal health spending to the rate of economic growth plus 1 percent, which would limit growth of Medicaid and other health insurance subsidies.
While the the commission's framework has garnered criticism from some organizations, it has been praised by the Concord Coalition, a non-partisan advocate of fiscal responsibility.
"Bowles and Simpson have delivered a valuable and sobering fiscal reality check," said Concord Coalition executive director Robert Bixby. "Their recommendations put aside partisan rhetoric and get at the essential trade-offs we need to confront among spending, taxes and debt."