[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H. Res. 360 Introduced in House (IH)]







104th CONGRESS
  2d Session
H. RES. 360

     Affirming the support of the House of Representatives for the 
   preservation of the integrity of the full faith and credit of the 
                       United States of America.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 1, 1996

 Mr. Vento (for himself, Mr. Schumer, Mr. Kanjorski, Mr. LaFalce, Mr. 
 Flake, Mr. Kennedy of Massachusetts, Ms. Velazquez, Mrs. Maloney, Mr. 
  Gutierrez, Mr. Watt of North Carolina, Mr. Ackerman, Mr. Barrett of 
 Wisconsin, Mr. Bentsen, and Mr. Frank of Massachusetts) submitted the 
 following resolution; which was referred to the Committee on Ways and 
                                 Means

_______________________________________________________________________

                               RESOLUTION


 
     Affirming the support of the House of Representatives for the 
   preservation of the integrity of the full faith and credit of the 
                       United States of America.

Whereas the United States has achieved the most secure and highest credit rating 
        of any nation;
Whereas the denigration of the full faith and credit of the United States would 
        have a substantial negative impact on its citizens if the United States 
        were to default on its debt obligations;
Whereas there exist no economic impediments which inhibit the ability of the 
        United States to honor its contractual obligations to pay the debt and 
        interest;
Whereas the majority leadership in Congress has issued contradictory political 
        statements regarding an orderly and rational procedure to increase the 
        debt ceiling to honor United States debt obligations;
Whereas no legal, prudent or practical tools remain for the Secretary of the 
        Treasury to prevent default on February 29 or March 1, 1996, unless 
        Congress increases the debt limit;
Whereas a top credit rating agency, Moody's Investors Services has announced 
        that it is considering downgrading the credit rating of United States 
        Treasury medium- and long-term debt obligations because the current 
        political threats and debate over the budget and the debt ceiling have 
        significantly increased the risk of default on certain Treasury 
        obligations;
Whereas if the United States were to default on its debt the Federal Government 
        would not be able to make $30 billion of Social Security (representing 
        43 million Social Security beneficiaries and 4 million SSI 
        beneficiaries) and other benefit payments;
Whereas if the United States were to default on its debt the Federal Government 
        would not be able to make over $1.5 billion in veterans benefits 
        payments (representing 2.2 million veterans with service-connected 
        disabilities, more than 300,000 survivors of veterans, and nearly three-
        quarters of a million poor war-time veterans and survivors);
Whereas if the United States were to default on its debt the over 1,500,000 
        active duty military personnel of the Army, Navy, Air Force, and 
        Marines, including our troops in Bosnia, would not be paid for their 
        service to the United States;
Whereas if the United States were to default on its debt the cost of home 
        mortgages, home equity loans, student loans, and all consumer debt 
        linked to Treasury securities will permanently increase at least one-
        quarter to a full percentage point;
Whereas if the United States were to default on its debt the cost of an average 
        student loan would rise by $850 over its life if rates on Treasury 
        securities increased by one-half a percentage point;
Whereas if the United States were to default on its debt the average homeowner 
        with a $100,000 ARM at 7.25 percent rate of interest, would pay an 
        additional $840 per year ($70 a month) if rates on Treasury securities 
        increased by one percent;
Whereas if the United States were to default on its debt the American taxpayers 
        would pay an additional $90 billion in interest over seven years, and 
        pension funds would lose $40 billion in the value of assets needed to 
        pay retiree benefits with just a one-half percentage point increase in 
        interest rates;
Whereas if the United States were to default on its debt the value of real 
        estate, pension funds, and other savings will drop;
Whereas the denigration of the full faith and credit of the United States and 
        the sanctity of United States debt instruments would create an economic 
        shock wave and have a substantial negative impact on the domestic and 
        international economy if the United States were to default on its debt 
        obligations;
Whereas if the United States were to default on its debt it would result in a 
        significant and permanent increase in Federal borrowing costs thereby 
        increasing the Federal deficit and hindering efforts to balance the 
        Federal budget;
Whereas if the United States were to default on its debt it would substantially 
        increase the costs of borrowing to State and local government;
Whereas if the United States were to default on its debt (dropping its rating to 
        at best a ``C'') it is uncertain when United States debt obligations 
        would regain their ``AAA'' status even once debt service resumes; and
Whereas this Nation, the United States of America, throughout its two hundred 
        year history, including the Civil War, World War I, World War II, and 
        the Great Depression, has never once defaulted on its debt: Now, 
        therefore, be it
    Resolved, That the House of Representatives should immediately 
enact an increase in the debt limit free of conditions.
    Be it further resolved, That the House of Representatives affirms 
its continued unequivocal support for the full faith and credit of the 
United States of America, and, that the threat of default should never 
be employed, issued or in any way implied in political policy debates 
in such a manner as would jeopardize the credit rating of the United 
States of America by casting doubt on whether the United States will 
honor its debts.
                                 <all>