House Republicans on Tuesday revealed a budget and taxation plan that would reduce the deficit and simplifyy the tax code, but it has "little chance of becoming law," Reuters reported.
While the plan would still produce deficits, the level would be lower than the current projected deficit under spending by President Obama. The Republican plan would generate deficits of "$3.13 trillion over the next 10 years - significantly below the $6.39 trillion in deficits that the Congressional Budget Office says Obama's fiscal 2013 budget plan would produce," Reuters said.
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The New York Times reported that "tax revenues would remain unchanged," and so spending would slowly shift from deficit to surplus, which would take "decades." "Significant changes to Medicaid and Medicare, the federal health care plans for the poor and the elderly, would help bring the budget into balance," it said.
In addition, the plan calls for simplifying the tax code into two brackets: ten percent and 25 percent, four fewer than the six brackets currently in use. Corporate taxes would also be lowered to 25 from 35 percent, and taxes would be mostly cut on American companies' overseas profits.
The Times wrote that the proposal "amounts to a political bet, with high stakes wagered by both parties," since Representative Paul Ryan, the Republican chairman of the House Budget Committee, is angling to frame the debate for Republican candidates - and Democrats - going into the 2012 elections.
Republicans think voters want to "transform and shrink" government, and Democrats think cuts to Medicare "without raising taxes on the rich" will backfire for Republicans.
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NPR's Tamara Keith said the new budget had a "somewhat less severe" Medicare proposal than the 2011 plan, partly because "dealing with Medicare last year didnt go entirely well for House Republicans."
Below is a video produced by the House Budget Committee about the new blueprint.