[Congressional Record Volume 157, Number 109 (Wednesday, July 20, 2011)]
[Extensions of Remarks]
[Pages E1365-E1366]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   CUT, CAP, AND BALANCE ACT OF 2011

                                 ______
                                 

                               speech of

                             HON. RON PAUL

                                of texas

                    in the house of representatives

                         Tuesday, July 19, 2011

  Mr. PAUL. Mr. Speaker, I rise to speak against H.R. 2560, the Cut, 
Cap, and Balance Act. This bill only serves to sanction the status quo 
by putting forth a $1 trillion budget deficit and authorizing a $2.4 
trillion increase in the debt limit.
  When I say this bill sanctions the status quo, I mean it quite 
literally.
  First, it purports to eventually balance the budget without cutting 
military spending, Social Security, or Medicare. This is impossible. 
These three budget items already cost nearly $1 trillion apiece 
annually. This means we can cut every other area of Federal spending to 
zero and still have a $3 trillion budget. Since annual Federal tax 
revenues almost certainly will not exceed $2.5 trillion for several 
years, this Act cannot balance the budget under any plausible scenario.
  Second, it further entrenches the ludicrous beltway concept of 
discretionary vs. nondiscretionary spending. America faces a fiscal 
crisis, and we must seize the opportunity once and for all to slay 
Washington's sacred cows--including defense contractors and 
entitlements. All spending must be deemed discretionary and reexamined 
by Congress each year. To allow otherwise is pure cowardice.
  Third, the Act applies the nonsensical narrative about a ``Global War 
on Terror'' to justify exceptions to its spending caps. Since this war 
is undeclared, has no definite enemies, no clear objectives, and no 
metric to determine victory, it is by definition endless. Congress will 
never balance the budget until we reject the concept of endless wars.
  Finally, and most egregiously, this Act ignores the real issue: total 
spending by government. As Milton Friedman famously argued, what we 
really need is a constitutional amendment to limit taxes and spending, 
not simply to balance the budget. What we need is a dramatically 
smaller Federal Government; if we achieve this a balanced budget will 
take care of itself.
  We do need to cut spending, and by a significant amount. Going back 
to 2008 levels of spending is not enough. We need to cut back at least 
to where spending was a decade ago. A recent news article stated that 
we pay 35 percent more for our military today than we did 10 years ago, 
for the exact same capabilities. The same could be said for the rest of 
the government. Why has our budget doubled in 10 years? This country 
doesn't have double the population, or double the land area, or double 
anything that would require the Federal Government to grow by such an 
obscene amount.
  We need to cap spending, and then continue decreasing that cap so 
that the Federal Government grows smaller and smaller. Allowing 
government to spend up to a certain percentage of GDP is insufficient. 
It doesn't matter that the recent historical average of government 
outlays is 18 percent of GDP, because in recent history the government 
has way overstepped its constitutional mandates. All we need to know 
about spending caps is that they need to decrease year after year.
  We need to balance the budget, but a balanced budget amendment by 
itself will not do the trick. A $4 trillion balanced budget is most 
certainly worse than a $2 trillion unbalanced budget. Again, we should 
focus on the total size of the budget more than outlays vs. revenues.
  What we have been asked to do here is support a budget that only cuts 
relative to the President's proposed budget. It still maintains a $1 
trillion budget deficit for FY 2012, and spends even more money over 
the next 10 years than the Paul Ryan budget which already passed the 
House.
  By capping spending at a certain constant percentage of GDP, it 
allows for Federal spending to continue to grow. Tying spending to GDP 
creates an incentive to manipulate the GDP figure, especially since the 
bill delegates the calculation of this figure to the Office of 
Management and Budget, an agency which is responsible to the President 
and not to Congress. In the worst case, it would even reward further 
inflation of the money supply, as increases in nominal GDP through pure 
inflation would allow for larger Federal budgets.
  Finally, this bill authorizes a $2.4 trillion rise in the debt limit. 
I have never voted for a debt ceiling increase and I never will. 
Increasing the debt ceiling is an endorsement of business as usual in 
Washington. It delays the inevitable, the day that one day will come 
when we cannot continue to run up enormous deficits and will be forced 
to pay our bills.
  In conclusion, Mr. Speaker, while I sympathize with the aims of this 
bill's sponsors, I must vote against H.R. 2560. It is my hope, however, 
that the looming debt ceiling deadline and the discussion surrounding 
the budget will further motivate us to consider legislation

[[Page E1366]]

in the near future that will make meaningful cuts and long-lasting 
reforms.

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