So with that I'd like to turn to the focus of my remarks today, which is first of all on the budget. I want to thank Senator Murray for her leadership on the Budget Committee and for all her hard work in advancing a smart, balanced budget to meet our country's fiscal challenges.
This is not the first time I've come to the Senate floor in the last year or in the last several years to stress the critical need for Democrats and Republicans to come together and focus on smart solutions to reducing our debt. I think it's a good sign that both the House and the Senate have passed budgets and that the President introduced his budget last month. I see this time as a real opportunity to come together to work through this budget process and get a deal done. That's why we must take the next step in the process, which is to move forward under regular order and have the House and Senate conference on a budget deal. For years we've been hearing from our colleagues across the aisle about how the Senate doesn't have the budget.
Well, the Senate passed a budget, and all we want to do is move this into conference committee so the House and Senate can work together so that we can get a budget for this country. There's growing bipartisan support for going to conference and starting the conversation so that we can come to an agreement on a long-term budget. Senators McCain and Collins last night came to the floor and talked about how we need to return to regular order in the senate and regular order means going to conference to come to a budget deal. Doing so will allow us to stop lurching from crisis to crisis and address our fiscal challenges in an open, bipartisan way. I believe this is what folks outside of Washington, especially the people I talk to in Minnesota, want. For us to put politics aside for the good of the country and come together on a budget deal that reduces our deficit in a balanced way, but also lays a foundation for sustained economic growth.
In the past two years, Congress has made some progress in reducing the deficit. We've already achieved $2.4 trillion in deficit reduction with a goal of a $4 trillion reduction within our grasp. Last week the CBO reported that the deficit will fall to $642 billion this year, $200 billion less than what the CBO projected just three months ago. The better numbers reflect good news in housing and larger than expected increases in tax revenues. But, I believe that resting on those numbers would be a mistake and if we are to get closer to reaching a new deficit agreement, it's only going to happen if we work in a bipartisan way through regular order to get a deal done.
Along with addressing our fiscal challenges, working through the budget process and coming to agreement will create a stronger, more resilient framework for economic renewal. We certainly see how we can get a major bill done through the Judiciary Committee last night when we were able to get the immigration bill done. There is no reason that a conference committee shouldn't be at work right now taking the Senate budget that we've heard for years needs to be done and pairing it up with the House budget and coming together.
In the bigger picture, this presents an opportunity for us to reinforce our role as a world leader in innovation, entrepreneurship, exporting and education, in other words, the things we've always prided in this country. We need to be a nation that makes things again, that exports to the world and part of that is showing the world that we have our fiscal house in order.
I believe the Senate proposal is the right blueprint for moving us forward. On the most immediate front it will allow us to build on the progress we're already seeing in the economy. Last month, the national unemployment rate dropped to 7.5 percent, the lowest level in four years. Our housing market is turning around. Consumer spending has picked up in the first month of this year, as has private business investment. The unemployment rate in Minnesota is 5.4 percent, but even with this progress, our economy remains vulnerable to headwinds.
Mr. President, we should keep this good economic momentum going, but only if we are willing to find common ground on a budget plan that also moves our economy forward. We need to take a balanced approach to deficit reduction, but you don't have to take my word for it. Nearly every commission that has offered ideas for reducing our debt has stressed the importance of balance. This includes the original Bowles-Simpson plan, the Rivlin-Dovenici plan and even the revised Bowles-Simpson, which calls for an additional $2.4 trillion in deficit reduction - a quarter of which would come from new revenue totals.
We don't need just a balanced budget. We need a budget that is in balance. I believe the Senate's budget achieves that goal. It includes an equal mix of responsible spending cuts and new revenue from closing loopholes and ending wasteful spending in the tax code. Our budget builds on the $2.4 trillion in deficit reduction we have already achieved in the last two years with an additional $975 billion in targeted cuts and $975 billion in new revenue, surpassing the bipartisan goal of $4 trillion.
Just this morning, I was at the Joint Economic Committee -- I am the Senate chair of that committee, as were you, Mr. President -- where chairman Bernanke testified, and he warned us about the negative impact with cuts that solely focus in the short term and what that would do with economic growth. He noted that policies like sequestration are creating headwinds against short-term economic growth and that Congress needs to take a broader, long-term view toward our debt and deficit.
That's what this conference committee is about. That's what regular order is about. We have a Senate budget. We have a House budget, and we have that opportunity to bring those budgets together in a conference committee. Some of the most important points in the Senate budget include the fact that it replaces sequestration with smart, targeted cuts while also making critical investments in areas like education, work force training and infrastructure. It produces savings in Medicare and Medicaid by eliminating waste and fraud, promoting efficiency and emphasizing cost alignment. Our budget also recognizes that there is a massive amount of spending that takes place through the tax code, to the tune of over $1 trillion per year in tax expenditures. The Senate budget eliminates wasteful tax loopholes and subsidies.
All told, the Senate budget cuts the deficit by approximately $2 trillion. This continues us on a downward path where our debt to GDP ratio will be about 70% by 2023. Getting the federal budget on a sustainable path will only promote growth and stability.
The American people want us to get this done, Mr. President. They want us to compromise, and they want us to work together to get the economy on the right track. I urge my colleagues to support moving to conference so that we can begin the work of finding solutions to a very important matter.
