Capitol Hill is finally starting work on its overdue budget. Yesterday, a Senate panel approved a $3.7 trillion budget plan.

The proposed budget, as outlined by Senate Democrats, would cut spending as a share of the total economy (i.e. GDP, or gross domestic product) by 11 percent.  That cut would reduce spending as a share of GDP from 25 percent to 22 percent in three years.

Democrats would accomplish this by freezing all non-security spending.  The budget also cuts the deficit as a percent of GDP by 70 percent, from 9.8 percent this year to just 3 percent in 2015.

Despite these cuts, the proposed budget adds to the nation’s already burdensome debt. It adds $3.9 trillion over the next five years.  Furthermore, it raises dividend taxes from 15% to 40%.  Investors, seniors, and, ultimately, the economy as a whole would feel the consequences of such an increase.

House leaders remain pessimistic about passing a budget as many Democrats from conservative districts will avoid appearing to support large deficits.  The House Budget Committee may begin its work next week.

Better late than never – that is, if Congress holds to its promise to reign in spending through the rest of the budget process and appropriations season.