Thank you very much. Mr. President, I want to first thank Senator Murray again for her leadership on the Budget Committee. Day in and day out, month in and month out, she has been working on this budget and she has achieved along with committee a smart balance proposal for meeting our country's fiscal challenges.
This is not the first time I have come to the Senate floor to talk about the critical need for a balanced approach and to bring down our debt in a balanced way, but this is the first time in a long time that I have actually felt optimistic that we're going to get a budget through the United States Senate, that I feel optimistic that there are a lot of stirrings of bipartisanship and compromise while our budget has been pointed out and I will point out is very different than the House budget. I think there are still grains of compromise there.
Well, we have seen this willingness in the Senate with our Republican colleagues to talk about bringing the debt down, whether it's the gang of six, whether it's the gang of eight, whether it's the work that we have seen with Simpson-Bowles or the works done with the Rivlin-Domenici group. These are all reasonable proposals. We don't agree with everything in them, but they are all reasonable proposals, and they contain some balance.
The other reason that I'm optimistic is that we have a great opportunity here. I was reminded of this last week when former Republican Senator Judd Gregg testified before our Joint Economic Committee. He actually paraphrased the Foreign Minister of Australia saying the United States is one debt deal away from leading the entire world out of economic doldrums.
Well, I couldn't agree more. Look at the economic news we've had in just the last month. We know there is so much work to do, that there are too many people unemployed, that there is too much investment that's not being made, but we also know that we saw the best month for unemployment numbers that we've seen in four years. We're seeing a turnaround in the construction market, we're seeing a turnaround in the housing market, and I can tell you that in my state, we have unemployment that's at about 5.6%, so we are seeing progress but we have more to do.
And the last thing we need to do now, Mr. President, is to go backwards. We need to go forward, and that's what Senator Murray's budget does in a very balanced way. As I’ve said many times before, we're talking about balance. I believe the Senate budget achieves the right equilibrium. It has spending cuts and new revenue from closing loopholes and ending wasteful spending in the tax code.
Our proposal builds on the $2.4 trillion in deficit reduction we have already received. I don't think every citizen knows that, Mr. President. $2.4 trillion. Let's remember 70% of that was tax cuts -- excuse me. 70% of that was spending cuts. 70% was spending cuts, and the other 30% was revenue. That is a balance. It's not exactly the balance that we wanted on our side of the aisle, but if we were to adopt the House budget right now, we would be at, if you include the past revenue, 10-1 spending cuts to revenue. That is not the balance we're seeing in the other proposals that have been made by these bipartisan groups.
How does our budget do this? The additional -- the additional deficit reduction to the $2.4 trillion that we've done to get to over $4 trillion in deficit reduction, well, first of all, $975 billion in targeted cuts and $975 billion in revenue. Again, this will help us to surpass the bipartisan goal of $4 trillion and put our debt to GDP ratio at about 70%.
Some of the most important points in the Senate budget include the fact that it replaces sequestration, which is really just a hammer, replaces it with smart, targeted cuts while also making critical investments in areas like education, work force training and infrastructure.
When I get out in our state with our unemployment rate at 5.6%, I hear time and time again that there are jobs unfilled, that we need to train workers, that we need our high school kids to be going into trades again, to be going into technology and math and science. This budget accounts for that. It produces savings in Medicare and Medicaid by eliminating waste and fraud, promoting efficiency and emphasizing cost align many.
We know a little bit about this in Minnesota with the Mayo Clinic and the way we deliver health care in a high-quality, low-cost way. One study out of Dartmouth showed that if they simply used in the rest of the hospitals across the country the cost-effective ways of the Mayo Clinic, you could save $50 billion, over $50 billion in five years with chronically ill patients. That just gives you a sense of what we're talking about when we talk about high-quality, low-cost care.
Our budget recognizes there is a tremendous amount of spending through the tax code to the tune of $1 trillion a year in tax expenditures. I come from a state with a thriving renewable energy sector and two years ago we agreed to let the tax credit expire. That was $60 billion in ten years, Mr. President, $60 billion. I don't understand why the oil industry can't follow ethanol's lead. I’ve seen the drilling in North Dakota. It's increased our domestic oil production and decrease our dependency on foreign oil but i don't need the oil companies need $40 billion. That's a lot of money to reduce the debt.
We can make other commonsense changes. One I would propose is with the home mortgage deduction, near and dear to everyone's heart, cap it in $500,000 in a home. If you buy a million dollars home, great. You get up to $500,000 in that home.
All told, the proposal coming out of Senator Murray's budget reduces the deficit by approximately $2 trillion. If enacted, our debt will continue in a downward path where our debt-to-GDP ratio would be 70%. Once in that range would result in a 1% increase in the size of the economy in that year. We can't discount the impact that a growing economy can have on deficit reduction. CBO expects GDP growth to be above 3% in three of the next four years.
As the economy grows, Mr. President, we'll see more revenue and we'll see lower deficits. Former CBO director Alice Rivlin who just testified last week at our Joint Economic Committee hearing on the very topic of debts and deficits, said this. She said the really important thing is to keep the debt from growing faster than the economy. I couldn't agree more. Deficit reduction must be paired with economic growth.
This is where we need to be and I'm optimistic ultimately, while we have many differences we'll hear a lot about today, ultimately we're going to come together on something that works for America. Unlike the proposal in the House, I will tell you the Senate budget preserves and protects Medicare, ensuring it's there for our seniors today and strong for our children and grandchildren tomorrow. I firmly believe we can make some reforms to our Social Security safety net and that those reforms, that money can go right back into social security to keep it solvent.
On the Medicare front there are many things we can do without reducing the benefits on our current seniors, on the people that deserve that help, look at what we can do. The VA, they negotiate prescription drug prices and get much less expensive drug prices for high quality drugs. We don't do that with Medicare. By negotiating prescription drug prices under Medicare Part D, Mr. President, you could produce $240 billion in savings over ten years right there. Why not leverage the power of America's seniors? They have a lot of power.
We all agree that we need to reduce our debt but our ultimate goal isn't simply a balanced budget, it's a budget that's balanced. Let's look at what goes on with the Ryan budget. Well, the Ryan budget gives millionaires a tax cut, drastically lowering their rate from 39.6% to 25%. Last year the Joint Economic Committee on which I serve estimated that a similar plan introduced would have given millionaires an additional $285,000 in tax breaks while hitting the middle-class family with a $1,300 tax hike.
He also claims that his tax cuts for the wealthy which would cost about $4.5 trillion -- and I say that because I believe they would be paid for by the middle class -- won't add to the deficit. But Ryan refuses to name one specific loophole or expenditure that his budget would eliminate to pay for the tax cuts. Some experts project that such extreme cuts as we would see in this budget would cost jobs and I believe that's true.
That's why as we're seeing this improvement in stabilization of our economy, we need to do things in a balanced way over the long term. We need to send a clear message we're reducing this debt and get to our goal of $4 trillion in deficit reduction in ten years. But we simply can't do it by doing it on the backs of the middle class who are still struggling in this country.
I urge my colleagues to support this budget proposal. It's time to get it done. I truly see this as a time of opportunity not only in the next two days, to get the budget done, but also in the next few months as we negotiate with our colleagues across the aisle to get a budget for America. Thank you very much, Mr. President