–Senate Budget Chair Conrad Says His Budget Would Help Fix Short Term
–Sen. Conrad: Budget Would Reduce Deficit To 3% of GDP in 2015
–Sen. Conrad: ‘Absolutely Imperative’ To Fix Structural Deficit
–Top Republican Sen Gregg: ‘On Course’ To Have ‘Junk Bond’ Government
–Sen. Gregg: Fiscal Problem Primarily Due To High Spending

By John Shaw

WASHINGTON (MNI) – Senate Budget Committee Chairman Kent Conrad and
Senator Judd Gregg, the ranking Republican on the Budget panel, differed
sharply Wednesday on the merits of Conrad’s new budget proposal, but
agreed the U.S.’s long-term fiscal outlook is grim.

Conrad formally unveiled his five year fiscal plan to the Senate
Budget Committee Wednesday afternoon, arguing that it would ratchet
budget deficits down from $1.4 trillion in fiscal year 2010 to $545
billion in FY’15.

A deficit of $545 billion in FY’15 would represent about 3% of GDP,
Conrad said.

“More must be done over the longer-term,” Conrad said, adding that
he is eager to review the findings of a presidential deficit reduction
commission that is due to report in December.

Conrad said his budget would allow for about $780 billion in net
tax cuts over five years and said this should be used to renew the 2001
and 2003 tax cuts for middle and low income taxpayers that are set to
expire.

Even if his budget is passed, Conrad said, the U.S. “remains on an
unsustainable course that must be addressed.”

Conrad said it’s “absolutely imperative” to address long-term
fiscal challenges.

Gregg said Conrad’s new budget effectively “kicks the can down the
road” and avoids making critical decisions to control spending and debt.

“It really doesn’t do a lot,” he said.

“I wish it were more aggressive on the debt, especially outyear
debt,” Gregg said.

Soaring debt levels threaten to “strangle” the nation, Gregg said.

“We are on an unsustainable path … . We are on course to have a
junk bond government,” Gregg said.

Gregg said policymakers must control the growth of Medicaid,
Medicare and Social Security.

“We know where the money is. It’s primarily the entitlement
accounts,” he said.

The Senate Budget Committee will begin voting on amendments to
Conrad’s plan Thursday.

Budget resolutions are non-binding congressional blueprints that
set spending and revenue goals and made budget deficit predictions.

Budget resolutions are important for setting the ceiling on
discretionary spending for the coming fiscal year.

Conrad has said that his plan will allocate $4 billion less on
FY’11 discretionary spending than does Obama’s plan which seeks $1.1
trillion.

** Market News International Washington Bureau: (202) 371-2121 **

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