A bill to prevent a fiscal crisis by enacting legislation to balance the Federal budget through reductions of discretionary and mandatory spending.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``One Percent Spending Reduction Act 
of 2011''.

SEC. 2. CONGRESSIONAL FINDINGS AND PURPOSE.

    (a) Findings.--The Congress finds the following:
            (1) The fiscal crisis faced by the Federal Government 
        demands immediate action.
            (2) The dramatic growth in spending and debt in recent 
        years threatens our economic and national security:
                    (A) Federal spending has grown from 18 percent of 
                GDP in 2001 to 24 percent of GDP in 2010.
                    (B) Total Federal debt exceeds $14 trillion and has 
                increased $4 trillion in the past three years alone.
                    (C) Without action, the Federal Government will 
                continue to run massive deficits in the next decade and 
                total Federal debt will rise to $24 trillion by 2021.
                    (D) Interest payments on this debt will soon rise 
                to the point where balancing the budget as a matter of 
                policy is beyond the reach of Congress.
            (3) From 1980 to 2010, Federal revenues averaged 18 percent 
        of GDP and are projected to return to that level within the 
        next decade.
            (4) Absent reform, the growth of Social Security, Medicare, 
        and Medicaid will overwhelm all other Federal programs and 
        consume all projected tax revenues.
    (b) Purpose.--The purpose of this Act is to address the fiscal 
crisis by--
            (1) acting quickly to balance the Federal budget and 
        eliminate the parade of deficits and ballooning interest 
        payments;
            (2) achieving balance by reducing spending one percent per 
        year until spending equals projected long-term revenues; and
            (3) reforming entitlement programs to ensure long-term 
        fiscal stability and balance.

SEC. 3. ESTABLISHMENT AND ENFORCEMENT OF SPENDING CAPS.

    (a) Outlay Caps.--The Balanced Budget and Emergency Deficit Control 
Act of 1985 is amended by inserting after section 253 the following new 
section:

``SEC. 253A. ESTABLISHING OUTLAY CAPS.

    ``(a) Outlay Caps.--In this section, the term `outlay cap' means:
            ``(1) Fiscal year 2012.--For fiscal year 2012, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2012 shall be $3,382,000,000,000, less one percent.
            ``(2) Fiscal year 2013.--For fiscal year 2013, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2013 shall be the amount computed under paragraph (1), less one 
        percent.
            ``(3) Fiscal year 2014.--For fiscal year 2014, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2014 shall be the amount computed under paragraph (2), less one 
        percent.
            ``(4) Fiscal year 2015.--For fiscal year 2015, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2015 shall be the amount computed under paragraph (3), less one 
        percent.
            ``(5) Fiscal year 2016.--For fiscal year 2016, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2016 shall be the amount computed under paragraph (4), less one 
        percent.
            ``(6) Fiscal year 2017.--For fiscal year 2017, the 
        aggregate outlays (less net interest payments) for fiscal year 
        2017 shall be the amount computed under paragraph (5), less one 
        percent.
            ``(7) Fiscal year 2018 and subsequent fiscal years.--(A) 
        For fiscal year 2018 and each subsequent fiscal year, the 
        aggregate outlays shall be 18 percent of the gross domestic 
        product for that fiscal year as estimated by OMB prior to March 
        of the previous fiscal year.
            ``(B) Notwithstanding paragraph (A), for any fiscal year 
        beginning with fiscal year 2019, the aggregate projected 
        outlays may not be less than the aggregate projected outlays 
        for the preceding fiscal year.
    ``(b) Sequestration.--
            ``(1) In general.--
                    ``(A) Excess spending.--Not later than 45 calendar 
                days after the beginning of a fiscal year, OMB shall 
                conduct a sequestration to eliminate the excess outlay 
                amount.
                    ``(B) Definitions.--
                            ``(i) For fiscal years 2012 through 2017 
                        and for purposes of this subsection, the term 
                        `excess outlay amount' means the amount by 
                        which total projected Federal outlays (less net 
                        interest payments) for a fiscal year exceeds 
                        the outlay cap for that fiscal year.
                            ``(ii) For fiscal year 2018 and in 
                        subsequent fiscal years and for purposes of 
                        this subsection, the term `excess outlay 
                        amount' means the amount by which total 
                        projected Federal outlays for a fiscal year 
                        exceeds the outlay cap for that fiscal year.
            ``(2) Sequestration.--
                    ``(A) On August 15 of each year, CBO shall issue a 
                sequestration preview report as described in section 
                254(c)(4).
                    ``(B) On August 20 of each year, OMB shall issue a 
                sequestration preview report as described in section 
                254(c)(4).
                    ``(C) On October 31 of each year, OMB shall issue 
                its final sequestration report as described in section 
                254(f)(3). It shall be accompanied by a Presidential 
                order detailing uniform spending reductions equal to 
                the excess outlay amount as defined in this section.
                    ``(D) The reductions shall generally follow the 
                process set forth in section 253 and 254, except as 
                provided in this section.
            ``(3) Congressional action.--If the August 20 OMB report 
        projects a sequestration, the Committees on Budget of the 
        Senate and House of Representatives may report a resolution 
        directing their committees to change the existing law to 
        achieve the spending reductions outlined in the August 20 
        report necessary to meet the outlay limits.
    ``(c) No Exempt Programs.--Section 255 and section 256 shall not 
apply to this section, except that payments for net interest (budget 
function 900) shall be exempt from the spending reductions under 
sequestration.
    ``(d) Look Back.--If, after November 14, a bill resulting in 
outlays for the fiscal year in progress is enacted that causes excess 
outlays, the excess outlay amount for the next fiscal year shall be 
increased by the amount or amounts of that breach.''.
    (b) Conforming Amendments to BBEDCA.--
            (1) Sequestration preview reports.--Section 254(c)(4) of 
        the Balanced Budget and Emergency Deficit Control Act of 1985 
        is amended to read as follows:
            ``(4) Outlay cap sequestration reports.--The preview 
        reports shall set forth for the budget year estimates for the 
        following:
                    ``(A)(i) For each of budget years 2012 through 
                2017: the aggregate projected outlays (less net 
                interest payment), less one percent.
                    ``(ii) For budget year 2018 and each subsequent 
                budget year: the estimated gross domestic product (GDP) 
                for that budget year.
                    ``(B) The amount of reductions required under 
                section 253A.
                    ``(C) The sequestration percentage necessary to 
                achieve the required reduction under section 253A.''.
            (2) Final sequestration reports.--Section 254(f)(3) of the 
        Balanced Budget and Emergency Deficit Control Act of 1985 is 
        amended to read as follows:
            ``(3) Outlay caps sequestration reports.--The final reports 
        shall contain all the information required in the outlay cap 
        sequestration preview reports. In addition, these report shall 
        contain, for the budget year, for each account to be 
        sequestered, estimates of the baseline level of sequestrable 
        budgetary resources and resulting outlays and the amount of 
        budgetary sources to be sequestered and result in outlay 
        reductions. The report shall also contain estimates of the 
        effects on outlays on the sequestration of each outyear for 
        direct spending programs.''.
            (3) Repeal of expiration date.--Section 275 of the Balanced 
        Budget and Emergency Deficit Control Act of 1985 is repealed.
    (c) Enforcement.--Title III of the Congressional Budget Act of 1974 
is amended by adding after section 315 the following:

``SEC. 316. ENFORCEMENT PROCEDURES.

    ``(a) Outlay Caps.--It shall not be in order in the House of 
Representatives or the Senate to consider any bill, joint resolution, 
amendment, or conference report that includes any provision that would 
cause the most recently reported, current outlay cap set forth in 
section 253A of the Balanced Budget and Emergency Deficit Control Act 
of 1985 to be breached.
    ``(b) Waiver or Suspension.--
            ``(1) In the senate.--The provisions of this section may be 
        waived or suspended in the Senate only by the affirmative vote 
        of two-thirds of the Members, duly chosen and sworn.
            ``(2) In the house.--The provisions of this section may be 
        waived or suspended in the House of Representatives only by a 
        rule or order proposing only to waive such provisions by an 
        affirmative vote of two-thirds of the Members, duly chosen and 
        sworn.
    ``(c) Point of Order Protection.--In the House, it shall not be in 
order to consider a rule or order that waives the application of 
paragraph (2) of subsection (b).
    ``(d) Motion To Suspend.--It shall not be in order for the Speaker 
to entertain a motion to suspend the application of this section under 
clause 1 of rule XV.''.

SEC. 4. CONFORMING AMENDMENTS.

    The table of contents set forth in--
            (1) section 1(b) of the Congressional Budget and 
        Impoundment Control Act of 1974 is amended by inserting after 
        the item relating to section 315 the following new item:

``Sec. 316. Enforcement procedures.'';
        and
            (2) section 250(a) of the Balanced Budget and Emergency 
        Deficit Control Act of 1985 is amended by inserting after the 
        item relating to section 253 the following new item:

``Sec. 253A. Establishing outlay caps.''.

SEC. 5. EFFECTIVE DATE.

    This Act and the amendments made by it shall apply to fiscal year 
2012 and subsequent fiscal years, including any reports and 
calculations required for implementation in fiscal year 2012.

Summary: One Percent Spending Reduction Act of 2011 - Amends the Balance Budget and Emergency Deficit Control Act of 1985 (Gramm-Rudman-Hollings Act) to establish the aggregate outlay (outlay cap) (less net interest payments) for FY2012 at $3.382 billion, less 1%.

Reduces each outlay cap for FY2013-FY2017 by 1% of the previous fiscal year's outlay cap.

Requires the outlay cap for FY2018 and each subsequent fiscal year to be 18% of the gross domestic product (GDP) for that fiscal year as estimated by the Office of Management and Budget (OMB).

Prohibits the outlay caps from being less than those for the preceding fiscal year for FY2019 and any ensuing fiscal year.

Requires a sequestration by OMB within 45 days after the beginning of a fiscal year to eliminate any excess outlay amount.

Prescribes requirements for Congressional Budget Office (CBO) and OMB sequestration preview reports and an OMB final sequestration report, accompanied by a presidential order detailing uniform spending reductions equal to the excess outlay amount.

Requires the House and the Senate budget committees to report a resolution directing the committees of their respective chambers to change existing law to achieve the spending reductions outlined in the OMB August 20 report to meet the outlay limits, if a sequestration is projected.

States that if, after November 14, a bill resulting in outlays for the current fiscal year is enacted that causes excess outlays, the excess outlays for the next fiscal year shall be increased by the amount or amounts of that breach.

Repeals provisions of the Gramm-Rudman-Hollings Act terminating Pay-As-You-Go (PAYGO) enforcement mechanisms under such Act.

Amends the Congressional Budget Act of 1974 to make it out of order in both chambers to consider any bill, joint resolution, amendment, or conference report that includes any provision that would cause the most recently reported, current outlay limits in the Gramm-Rudman-Hollings Act to be exceeded. Prescribes procedures for waiver or suspension of this rule.