Conrad: Spending and tax changes needed to cut deficits

"The harsh reality is that revenue structure in this country is inefficient, is not allowing for the full competitive strength of the United States and is also not fair, we do not have a fair distribution of the burden," Conrad added.

The federal debt under President Barack Obama's budget plan is expected to grow from a level equal to roughly 60 percent of gross domestic product to 90 percent by the end of the decade, according to the Congressional Budget Office (CBO). The annual deficit would go from a level equal to about 10 percent of GDP to roughly 4 percent by the middle of this decade, then it would start to grow due largely to rising entitlement costs, the CBO has projected.

Conrad said Obama's plan doesn't propose enough deficit reduction in the latter half of this decade.

Conrad's budget proposal, which will likely be voted on by the Senate Budget Committee on Thursday, would reduce the deficit to 3 percent of GDP by 2015. It doesn't include fiscal policy beyond that year.

Conrad and other fiscal hawks are looking to the White House fiscal commission to propose more deficit reductions. The 18-member commission, which includes an equal number of Republican lawmakers, Democratic lawmakers and economic experts chosen by Obama, is being asked to make recommendations to reduce deficits in December. A package of proposals supported by 14 of the panel's members would be brought up for votes by the Democratic leaders in both chambers of Congress.

Obama along with GOP and Democratic members of the panel have said they're not ruling out any proposal -- including tax hikes and changes to entitlement programs -- before their first meeting Tuesday.

Conrad, who is one of the commission's three Democratic senators, said drastic deficit reduction measures should start soon after this year, after the economic recovery has set in.

"We've got to put in place a plan that makes sense of economic reality this year, then we've got to begin the pivot... to go after deficits and debt," he said.