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(c) ADJUSTMENTS.—The chair of the Committee on 
the Budget may adjust the allocations, aggregates, and 
other appropriate levels for legislation reported by the 
Committee on Oversight and Government Reform that re-
forms the Federal retirement system, if such adjustments 
do not cause a net increase in the deficit for fiscal year 
2014 and the period of fiscal years 2014 through 2023. 
SEC. 606. APPLICATION AND EFFECT OF CHANGES IN ALLO-
CATIONS AND AGGREGATES. 
(a) APPLICATION.—Any adjustments of the alloca-
tions, aggregates, and other appropriate levels made pur-
suant to this concurrent resolution shall— 
(1) apply while that measure is under consider-
ation; 
(2) take effect upon the enactment of that 
measure; and 
(3) be published in the Congressional Record as 
soon as practicable. 
(b) EFFECT OF CHANGED ALLOCATIONS AND AG-
GREGATES.—Revised allocations and aggregates resulting 
from these adjustments shall be considered for the pur-
poses of the Congressional Budget Act of 1974 as alloca-
tions and aggregates included in this concurrent resolu-
tion. 
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(c) BUDGET COMPLIANCE.—(1) The consideration of 
any bill or joint resolution, or amendment thereto or con-
ference report thereon, for which the chair of the Com-
mittee on the Budget makes adjustments or revisions in 
the allocations, aggregates, and other appropriate levels 
of this concurrent resolution shall not be subject to the 
points of order set forth in clause 10 of rule XXI of the 
Rules of the House of Representatives or section 604. 
(2) Section 314(f) of the Congressional Budget Act 
of 1974 shall not apply in the House of Representatives 
to any bill, joint resolution, or amendment that provides 
new budget authority for a fiscal year or to any conference 
report on any such bill or resolution, if— 
(A) the enactment of that bill or resolution; 
(B) the adoption and enactment of that amend-
ment; or 
(C) the enactment of that bill or resolution in 
the form recommended in that conference report; 
would not cause the appropriate allocation of new budget 
authority made pursuant to section 302(a) of such Act 
for that fiscal year to be exceeded or the sum of the limits 
on the security and non-security category in section 251A 
of the Balanced Budget and Emergency Deficit Control 
Act as reduced pursuant to such section. 
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SEC. 607. CONGRESSIONAL BUDGET OFFICE ESTIMATES. 
(a) FINDINGS.—The House finds the following: 
(1) Costs of Federal housing loans and loan 
guarantees are treated unequally in the budget. The 
Congressional Budget Office uses fair-value account-
ing to measure the costs of Fannie Mae and Freddie 
Mac, but determines the cost of other Federal hous-
ing programs on the basis of the Federal Credit Re-
form Act of 1990 (‘‘FCRA’’). 
(2) The fair-value accounting method uses dis-
count rates which incorporate the risk inherent to 
the type of liability being estimated in addition to 
Treasury discount rates of the proper maturity 
length. In contrast, cash-basis accounting solely uses 
the discount rates of the Treasury, failing to incor-
porate risks such as prepayment and default risk. 
(3) The Congressional Budget Office estimates 
that the $635 billion of loans and loan guarantees 
issued in 2013 alone would generate budgetary sav-
ings of $45 billion over their lifetime using FCRA 
accounting. However, these same loans and loan 
guarantees would have a lifetime cost of $11 billion 
under fair-value methodology. 
(4) The majority of loans and guarantees issued 
in 2013 would show deficit reduction of $9.1 billion 
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under FCRA methodology, but would increase the 
deficit by $4.7 billion using fair-value accounting. 
(b) FAIR VALUE ESTIMATES.—Upon the request of 
the chair or ranking member of the Committee on the 
Budget, any estimate prepared by the Director of the Con-
gressional Budget Office for a measure under the terms 
of title V of the Congressional Budget Act of 1974, ‘‘credit 
reform’’, as a supplement to such estimate shall, to the 
extent practicable, also provide an estimate of the current 
actual or estimated market values representing the ‘‘fair 
value’’ of assets and liabilities affected by such measure. 
(c) FAIR VALUE ESTIMATES FOR HOUSING PRO-
GRAMS.—Whenever the Director of the Congressional 
Budget Office prepares an estimate pursuant to section 
402 of the Congressional Budget Act of 1974 of the costs 
which would be incurred in carrying out any bill or joint 
resolution and if the Director determines that such bill 
or joint resolution has a cost related to a housing or resi-
dential mortgage program under the FCRA, then the Di-
rector shall also provide an estimate of the current actual 
or estimated market values representing the ‘‘fair value’’ 
of assets and liabilities affected by the provisions of such 
bill or joint resolution that result in such cost. 
(d) ENFORCEMENT.—If the Director of the Congres-
sional Budget Office provides an estimate pursuant to 
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subsection (b) or (c), the chair of the Committee on the 
Budget may use such estimate to determine compliance 
with the Congressional Budget Act of 1974 and other 
budgetary enforcement controls. 
SEC. 608. TRANSFERS FROM THE GENERAL FUND OF THE 
TREASURY TO THE HIGHWAY TRUST FUND 
THAT INCREASE PUBLIC INDEBTEDNESS. 
For purposes of the Congressional Budget Act of 
1974, the Balanced Budget and Emergency Deficit Con-
trol Act of 1985, or the rules or orders of the House of 
Representatives, a bill or joint resolution, or an amend-
ment thereto or conference report thereon, that transfers 
funds from the general fund of the Treasury to the High-
way Trust Fund shall be counted as new budget authority 
and outlays equal to the amount of the transfer in the 
fiscal year the transfer occurs. 
SEC. 609. SEPARATE ALLOCATION FOR OVERSEAS CONTIN-
GENCY OPERATIONS/GLOBAL WAR ON TER-
RORISM. 
(a) ALLOCATION.—In the House, there shall be a sep-
arate allocation to the Committee on Appropriations for 
overseas contingency operations/global war on terrorism. 
For purposes of enforcing such separate allocation under 
section 302(f) of the Congressional Budget Act of 1974, 
the ‘‘first fiscal year’’ and the ‘‘total of fiscal years’’ shall 
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be deemed to refer to fiscal year 2014. Such separate allo-
cation shall be the exclusive allocation for overseas contin-
gency operations/global war on terrorism under section 
302(a) of such Act. Section 302(c) of such Act shall not 
apply to such separate allocation. The Committee on Ap-
propriations may provide suballocations of such separate 
allocation under section 302(b) of such Act. Spending that 
counts toward the allocation established by this section 
shall be designated pursuant to section 251(b)(2)(A)(ii) 
of the Balanced Budget and Emergency Deficit Control 
Act of 1985. 
(b) ADJUSTMENT.—In the House, for purposes of 
subsection (a) for fiscal year 2014, no adjustment shall 
be made under section 314(a) of the Congressional Budget 
Act of 1974 if any adjustment would be made under sec-
tion 251(b)(2)(A)(ii) of the Balanced Budget and Emer-
gency Deficit Control Act of 1985. 
SEC. 610. EXERCISE OF RULEMAKING POWERS. 
The House adopts the provisions of this title— 
(1) as an exercise of the rulemaking power of 
the House of Representatives and as such they shall 
be considered as part of the rules of the House of 
Representatives, and these rules shall supersede 
other rules only to the extent that they are incon-
sistent with other such rules; and 
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(2) with full recognition of the constitutional 
right of the House of Representatives to change 
those rules at any time, in the same manner, and to 
the same extent as in the case of any other rule of 
the House of Representatives. 
TITLE VII—POLICY STATEMENTS 
SEC. 701. POLICY STATEMENT ON ECONOMIC GROWTH AND 
JOB CREATION. 
(a) FINDINGS.—The House finds the following: 
(1) Although the U.S. economy technically 
emerged from recession roughly four years ago, the 
recovery has felt more like a malaise than a rebound 
with the unemployment rate still elevated and real 
economic growth essentially flat in the final quarter 
of 2012. 
(2) The enormous build-up of Government debt 
in the past four years has worsened the already 
unsustainable course of Federal finances and is an 
increasing drag on the U.S. economy. 
(3) During the recession and early stages of re-
covery, the Government took a variety of measures 
to try to boost economic activity. Despite the fact 
that these stimulus measures added over $1 trillion 
to the debt, the economy continues to perform at a 
sub-par trend. 
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(4) Investors and businesses make decisions on 
a forward-looking basis. They know that today’s 
large debt levels are simply tomorrow’s tax hikes, in-
terest rate increases, or inflation – and they act ac-
cordingly. It is this debt overhang, and the uncer-
tainty it generates, that is weighing on U.S. growth, 
investment, and job creation. 
(5) Economists have found that the key to 
jump-starting U.S. economic growth and job cre-
ation is tangible action to rein in the growth of Gov-
ernment spending with the aim of getting debt 
under control. 
(6) Stanford economist John Taylor has con-
cluded that reducing Government spending now 
would ‘‘reduce the threats of higher taxes, higher in-
terest rates and a fiscal crisis’’, and would therefore 
provide an immediate stimulus to the economy. 
(7) Federal Reserve Chairman Ben Bernanke 
has stated that putting in place a credible plan to 
reduce future deficits ‘‘would not only enhance eco-
nomic performance in the long run, but could also 
yield near-term benefits by leading to lower long- 
term interest rates and increased consumer and 
business confidence.’’ 
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(8) Lowering spending would boost market con-
fidence and lessen uncertainty, leading to a spark in 
economic expansion, job creation, and higher wages 
and income. 
(b) POLICY ON ECONOMIC GROWTH AND JOB CRE-
ATION.—It is the policy of this resolution to promote fast-
er economic growth and job creation. By putting the budg-
et on a sustainable path, this resolution ends the debt- 
fueled uncertainty holding back job creators. Reforms to 
the tax code put American businesses and workers in a 
better position to compete and thrive in the 21st century 
global economy. This resolution targets the regulatory red 
tape and cronyism that stack the deck in favor of special 
interests. All of the reforms in this resolution serve as 
means to the larger end of growing the economy and ex-
panding opportunity for all Americans. 
SEC. 702. POLICY STATEMENT ON TAX REFORM. 
(a) FINDINGS.—The House finds the following: 
(1) A world-class tax system should be simple, 
fair, and promote (rather than impede) economic 
growth. The U.S. tax code fails on all three counts 
– it is notoriously complex, patently unfair, and 
highly inefficient. The tax code’s complexity distorts 
decisions to work, save, and invest, which leads to 
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slower economic growth, lower wages, and less job 
creation. 
(2) Since 2001 alone, there have been more 
than 3,250 changes to the code. Many of the major 
changes over the years have involved carving out 
special preferences, exclusions, or deductions for var-
ious activities or groups. These loopholes add up to 
more than $1 trillion per year and make the code 
unfair, inefficient, and very complex. 
(3) These tax preferences are disproportionately 
used by upper-income individuals. For instance, the 
top 1 percent of taxpayers reap about 3 times as 
much benefit from special tax credits and deductions 
(excluding refundable credits) than the middle class 
and 13 times as much benefit than the lowest in-
come quintile. 
(4) The large amount of tax preferences that 
pervade the code end up narrowing the tax base by 
as much as 50 percent. A narrow tax base, in turn, 
requires much higher tax rates to raise a given 
amount of revenue. 
(5) The National Taxpayer Advocate reports 
that taxpayers spent 6.1 billion hours in 2012 com-
plying with tax requirements. 
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(6) Standard economic theory shows that high 
marginal tax rates dampen the incentives to work, 
save, and invest, which reduces economic output and 
job creation. Lower economic output, in turn, mutes 
the intended revenue gain from higher marginal tax 
rates. 
(7) Roughly half of U.S. active business income 
and half of private sector employment are derived 
from business entities (such as partnerships, S cor-
porations, and sole proprietorships) that are taxed 
on a ‘‘pass-through’’ basis, meaning the income 
flows through to the tax returns of the individual 
owners and is taxed at the individual rate structure 
rather than at the corporate rate. Small businesses 
in particular tend to choose this form for Federal 
tax purposes, and the top Federal rate on such small 
business income reaches 44.6 percent. For these rea-
sons, sound economic policy requires lowering mar-
ginal rates on these pass-through entities. 
(8) The U.S. corporate income tax rate (includ-
ing Federal, State, and local taxes) sums to just 
over 39 percent, the highest rate in the industri-
alized world. The total Federal marginal tax rate on 
corporate income now reaches 55 percent, when in-
cluding the shareholder-level tax on dividends and 
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capital gains. Tax rates this high suppress wages 
and discourage investment and job creation, distort 
business activity, and put American businesses at a 
competitive disadvantage with foreign competitors. 
(9) By deterring potential investment, the U.S. 
corporate tax restrains economic growth and job cre-
ation. The U.S. tax rate differential with other coun-
tries also fosters a variety of complicated multi-
national corporate behaviors intended to avoid the 
tax, which have the effect of moving the tax base 
offshore, destroying American jobs, and decreasing 
corporate revenue. 
(10) The ‘‘worldwide’’ structure of U.S. inter-
national taxation essentially taxes earnings of U.S. 
firms twice, putting them at a significant competi-
tive disadvantage with competitors with more com-
petitive international tax systems. 
(11) Reforming the U.S. tax code to a more 
competitive international system would boost the 
competitiveness of U.S. companies operating abroad 
and it would also greatly reduce tax avoidance. 
(12) The tax code imposes costs on American 
workers through lower wages, on consumers in high-
er prices, and on investors in diminished returns. 
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(13) Revenues have averaged 18 percent of the 
economy throughout modern American history. Rev-
enues rise above this level under current law to 19.1 
percent of the economy, and – if the spending re-
straints in this budget are enacted – this level is suf-
ficient to fund Government operations over time. 
(14) Attempting to raise revenue through tax 
increases to meet out-of-control spending would sink 
the economy. 
(15) Closing tax loopholes to fund spending 
does not constitute fundamental tax reform. 
(16) The goal of tax reform should be to curb 
or eliminate loopholes and use those savings to lower 
tax rates across the board – not to fund more waste-
ful Government spending. Tax reform should be rev-
enue-neutral and should not be an excuse to raise 
taxes on the American people. 
(b) POLICY ON TAX REFORM.—It is the policy of this 
resolution that Congress should enact legislation during 
fiscal year 2014 that provides for a comprehensive reform 
of the U.S. tax code to promote economic growth, create 
American jobs, increase wages, and benefit American con-
sumers, investors, and workers through revenue-neutral 
fundamental tax reform, which should be reported by the 
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Committee on Ways and Means to the House not later 
than December 31, 2013, that— 
(1) simplifies the tax code to make it fairer to 
American families and businesses and reduces the 
amount of time and resources necessary to comply 
with tax laws; 
(2) substantially lowers tax rates for individ-
uals, with a goal of achieving a top individual rate 
of 25 percent and consolidating the current seven in-
dividual income tax brackets into two brackets with 
a first bracket of 10 percent; 
(3) repeals the Alternative Minimum Tax; 
(4) reduces the corporate tax rate to 25 per-
cent; and 
(5) transitions the tax code to a more competi-
tive system of international taxation. 
SEC. 703. POLICY STATEMENT ON MEDICARE. 
(a) FINDINGS.—The House finds the following: 
(1) More than 50 million Americans depend on 
Medicare for their health security. 
(2) The Medicare Trustees Report has repeat-
edly recommended that Medicare’s long-term finan-
cial challenges be addressed soon. Each year without 
reform, the financial condition of Medicare becomes 
more precarious and the threat to those in or near 
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retirement becomes more pronounced. According to 
the Congressional Budget Office— 
(A) the Hospital Insurance Trust Fund 
will be exhausted in 2023 and unable to pay 
scheduled benefits; and 
(B) Medicare spending is growing faster 
than the economy and Medicare outlays are 
currently rising at a rate of 6.2 percent per 
year, and under the Congressional Budget Of-
fice’s alternative fiscal scenario, direct spending 
on Medicare is projected to exceed 7 percent of 
GDP by 2040 and reach 13 percent of GDP by 
2085. 
(3) The President’s health care law created a 
new Federal agency called the Independent Payment 
Advisory Board (‘‘IPAB’’) empowered with unilat-
eral authority to cut Medicare spending. As a result 
of that law— 
(A) IPAB will be tasked with keeping the 
Medicare per capita growth below a Medicare 
per capita target growth rate. Prior to 2018, 
the target growth rate is based on the five-year 
average of overall inflation and medical infla-
tion. Beginning in 2018, the target growth rate 
will be the five-year average increase in the 
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nominal Gross Domestic Product (GDP) plus 
one percentage point; 
(B) the fifteen unelected, unaccountable 
bureaucrats of IPAB will make decisions that 
will reduce seniors access to care; 
(C) the nonpartisan Office of the Medicare 
Chief Actuary estimates that the provider cuts 
already contained in the Affordable Care Act 
will force 15 percent of hospitals, skilled nurs-
ing facilities, and home health agencies to close 
in 2019; and 
(D) additional cuts from the IPAB board 
will force even more health care providers to 
close their doors, and the Board should be re-
pealed. 
(4) Failing to address this problem will leave 
millions of American seniors without adequate health 
security and younger generations burdened with 
enormous debt to pay for spending levels that cannot 
be sustained. 
(b) POLICY ON MEDICARE REFORM.—It is the policy 
of this resolution to protect those in or near retirement 
from any disruptions to their Medicare benefits and offer 
future beneficiaries the same health care options available 
to Members of Congress. 
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