[Congressional Record Volume 157, Number 114 (Wednesday, July 27, 2011)]
[Senate]
[Pages S4930-S4933]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE DEBT CEILING
Mr. BINGAMAN. Mr. President, we have three separate issues facing the
Congress. First, the authority of the Treasury Department to borrow to
meet the Nation's obligations will be reached on Tuesday. In order for
borrowing to continue after Tuesday, Congress needs to raise the debt
ceiling. That is the first of the three issues.
The second issue we face is the need to help our economy to become
prosperous again. Unfortunately, the debate in Congress has totally
lost sight of this issue, the issue of how we can grow the economy and
how we can create jobs.
The third of the three issues is the need to put in place a long-term
plan to reduce the deficit and the debt. The issue of raising the debt
ceiling and reducing the long-term deficit and debt have,
unfortunately, come to be seen by many in Congress as a single issue.
So I want to urge all colleagues to take a step back and to recognize,
first, that these issues are separate and, second, that failure to
responsibly deal with the first of these issues; that is, failure to
raise the debt limit, will greatly hamper our ability to deal with the
other two issues that I mentioned.
The failure to raise the debt limit will not return our economy to
prosperity; instead, it will postpone the day when that prosperity
returns. Failure to raise the debt limit will not help reduce our debt
and deficit. It will add to the debt and deficit by raising interest
rates for the government and for all Americans.
So let's review how we got here.
Since the beginning of this Congress nearly 7 months ago, the
Republican majority in the House has had a laser focus on one issue;
that is, cutting spending. To achieve that objective, the first
strategy adopted by the Republican leadership in the House was to
threaten a shutdown of the government unless sufficient spending cuts
were agreed to. Spending cuts were agreed to, and at the final hour
Republicans agreed to pass the bill that was needed to fund the
government for the balance of the fiscal year. By that I mean through
September 30 of this year.
So as soon as that crisis was averted and the threat to close down
the government was behind us, at least for a few months, the effort
shifted to a new strategy. This strategy was to threaten a first-in-
history default by the government on its financial obligations if
enough additional spending cuts were not agreed to; that is, spending
cuts in addition to what were agreed to, in order to avert a shutdown
of the government. The device for bringing about that default was
refusal to extend the debt ceiling when the government's borrowing
authority was scheduled to be reached August 2, next Tuesday.
We should remind ourselves of what an artificial device is being used
for leverage in this negotiation. Congress passes the laws that
determine how much revenue the Federal Government collects, and
Congress passes the laws that determine how much we obligate the
government to spend. When the revenue we collect is less than the
amount we are committed to spend, the Secretary of the Treasury has no
alternative but to borrow money to meet the obligations that Congress
has taken on.
So in a period like today, when the government is receiving in
revenues much less than is required to meet its obligations, there are
two logical actions for Congress to take. First, it can raise more
revenue; second, it can reduce the obligations of the government. But
in refusing to allow the Secretary of the Treasury to borrow, we are
taking neither of these logical steps. Instead, we are telling the
Secretary of the Treasury to default on the obligations which this and
previous Congresses have already taken on on behalf of the American
people.
We are told by the Secretary of the Treasury that unless Congress
acts he will be forced to default or renege on our obligations
beginning next week, August 2. The refusal to raise the debt ceiling
and the threatening of default on our obligations has achieved much of
what Republicans set out to achieve in this Congress. It has
precipitated a crisis and in order to avoid that crisis,
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Democrats have agreed to or acceded to the primary demands the
Republican majority in the House have made.
What are those demands? There are two primary demands. The first of
those demands was that all of the deficit reduction be accomplished
with cuts in spending. No revenue could be raised from the wealthiest
in our society to help close this gap between revenues and spending; no
loopholes could be closed; no subsidies could be eliminated from the
Tax Code.
Democrats have agreed that the deficit reduction would not be
accomplished with a balanced package of spending cuts and revenue
increases as the previous deficit reduction packages have been under
President Reagan, under President George H.W. Bush, and of course under
President Clinton. This deficit reduction that we are now considering
would be done with spending cuts only. So that was the first demand and
it was one that Democrats have acceded to.
The second demand of the Republican leadership was the totally
arbitrary demand that the size of the increase in the debt ceiling not
exceed the amount of spending cuts projected in the Federal budget over
the next 10 years. This is a demand totally lacking in any logical
justification, but, again, Democrats have agreed in order to achieve a
solution to the immediate impasse.
In order to avoid the threatened default on our obligations, Senator
Reid has put forward a proposal that would lock in, according to the
Congressional Budget Office, about $2.2 trillion of deficit reduction
over 10 years with cuts in both discretionary spending and mandatory
spending. The Treasury Secretary would be given authority to borrow to
meet the obligations that Congress has undertaken for approximately
another 18 months. The proposal also puts in place a bipartisan and a
bicameral committee with responsibility to present Congress with
legislation to further reduce the deficit.
Unfortunately, it appears this proposal that Senator Reid has made
will be opposed by many on the Republican side. Some say the cuts are
not sufficiently deep and that they would rather push the country into
default rather than agree to a mere $2.2 trillion in spending cuts.
Some others say they want to extend the debt ceiling for a shorter
period so we can have another showdown with another threatened
government default 6 or 7 months from now. Some say that causing the
Federal Government to default will not have the adverse consequences
the Secretary of the Treasury has predicted and that in fact it will
have a salutary effect on both our economy and our politics.
I strongly disagree with all of these views. I believe a refusal to
honor our obligations will have a major adverse consequence for our
economy. I believe Congress should act now to raise the debt limit in
order to avoid these adverse consequences and that, although the
proposal Senator Reid has brought forward fails the test of balance
between spending cuts and revenue increases which I would prefer, it is
a plan I am willing to support in order to head off a default on our
Nation's obligations. I understand additional deficit reduction will be
required in the months and years ahead, but clearly the responsible
course is to do what can be done today and that is adopt the Reid plan.
Only by doing so can we once again focus on the steps we can take to
return our economy to prosperity. That is the first priority for most
Americans today. It should be our first priority as well.
Mr. President, I yield the floor.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BROWN of Ohio. Mr. President, I ask unanimous consent that the
order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BROWN of Ohio. Mr. President, this week we have a unique
opportunity to reduce the deficit to the tune of $2.2 trillion. That is
$2.2 trillion to protect Medicare, to protect Social Security, to
protect Medicaid, and to make sure the United States of America doesn't
do something we have never done; that is, go into default.
We can debate how we got here. We can debate why we have this huge
budget deficit. We can debate whether it is Barack Obama's fault or
George Bush's fault. We can debate whether it was the Recovery Act or
whether it was the two wars President Bush didn't pay for. We can
debate whether it is the health care bill of President Obama or the
giveaway to the drug and insurance companies that President Bush did in
the name of Medicare privatization. We could talk about President
Bush's tax cuts. We could do any of that, but the urgency of this
situation is not a question for debate. Never before has the full faith
and credit of the United States of America been held hostage to a major
budget agreement.
In the past three decades before President Obama--so let's take him
out of this picture for a minute--we have avoided default by raising
the debt limit 38 times in the last 30 years before President Obama.
Out of those 38 times, 34 of those times--almost 90 percent--were under
Republican Presidents. Again, 34 of 38 times were under Republican
Presidents. We didn't do a hostage-taking. We didn't try to scare
people. Even if we didn't like doing it, we simply raised the debt
ceiling.
As I and many Democratic colleagues have said, we can balance the
budget as we did under President Clinton. I came to office in 1992 in
the House. I voted for a controversial budget. No Republicans joined
us. We had almost 8 years of economic growth, with 21 million net
private sector jobs created, and we got to a balanced budget. We know
how to do that. We do it with a balance between spending cuts and
revenues, especially closing tax loopholes, giveaways to the oil
companies, tax breaks for companies that outsource jobs, and tax breaks
for hedge fund operators on Wall Street. We can close those tax
loopholes. We can do spending cuts, and we can do what we need to do to
move toward a balanced budget.
During those 38 times, there were freestanding votes. Each time it
was raised, there was a freestanding vote. Neither party played these
games. Neither party held our Nation hostage to these political games.
Rather than a freestanding vote on the debt limit, we are in a last-
minute scramble. Democrats have said: OK, we will reach an agreement.
Never has one party insisted that the amount of the increase in the
debt limit be offset by an equal amount of spending cuts. We have even
agreed to that approach. Never before has one party insisted that a
major budget agreement exclude provisions that address revenue. We have
even said yes to that. Now having had their demands met, the people in
the party who insisted on all these conditions are saying no. They are
saying no again.
The debate on the debt and the deficit has been complicated, it has
been contentious, it has been angry, but a default should be
unimaginable. A default should be unimaginable. A default would risk
what would amount to a permanent tax hike.
I hear many of the radicals in the House of Representatives who say
they will never vote for a debt increase, as if it is something we
should never, ever do in a country. They all talk about tax cuts, but a
default on the part of the United States of America would amount to a
permanent tax hike on all Americans. Interest rates would rise for
anyone owning a home, paying a home mortgage, applying for a home
mortgage, anyone with a car loan, anyone with a college loan. Credit
costs for all borrowers would climb for governments at every level,
businesses, nonprofits, small businesses, large businesses, credit card
holders. There would be repercussions for pension funds and money
market funds that guard the retirement savings of middle-class
families.
Basically, everybody in the Presiding Officer's home State of
Minnesota, in my home State of Ohio--everybody would be afflicted with
this tax increase, if you will, from higher interest rates. Several
States have already been placed on a credit watch. Every State would be
hurt by a Federal default, which is why Governors of both parties are
saying: Make a deal; get to this. This is not alarmist thinking.
There is a reason Ronald Reagan went to Congress 18 times to raise
the debt ceiling. Here is what President Reagan said:
The full consequences of a default--or even the serious
prospect of a default--
[[Page S4932]]
That is where we are right now, in a serious prospect of default--
by the United States are impossible to predict and awesome to
contemplate. Denigration of the full faith and credit of the
United States would have substantial effects on the domestic
financial markets and the value of the dollar.
None of us is being alarmist because we really don't know, but we
know people whom most Americans respect--President Reagan, President
Clinton, others who have asked for a debt ceiling increase, economists,
businesspeople--nobody knows for sure what would happen, but nobody has
ever wanted to take that risk. We have always paid our bills. Default
could affect Ohioans receiving Medicare and Social Security. It could
affect veterans in hospitals and universities. President Obama has said
he can't guarantee payments to senior citizens, to bondholders, or
other obligations of the United States of America. You cannot fake
cashflow. These are real consequences.
When it comes to jobs, to seniors living on fixed income, in the
midst of an economic growth that is as fragile as ours is, lawmakers
ought to suspend their politics. Today, the harm of inaction would be
immense.
President Obama put several proposals forward to reduce the deficit
in a big way, modeled after these bipartisan commissions where there
has been pretty good bipartisan agreement. But efforts to forge a grand
compromise bringing the deficit down by $4 trillion have been abandoned
by Republican leaders over and over.
I have not supported every detail on these grand compromise efforts.
I don't want to do anything to undermine Medicare or Social Security or
Medicaid, programs that have worked for generations now and programs
that millions of Ohioans depend on, from Middletown to Ashtabula, from
Toledo to Athens and Gallipolis. I wanted a more balanced approach. I
know the Presiding Officer did too. But as days and weeks and months go
by, we are now only days away from default. We are simply running out
of time. That is what the Senate bill is about--protecting us from
default.
In the spirit of continued compromise, again, the majority leader has
come forth with a plan to reduce the deficit by $2.2 trillion. It is
truly a compromise because it meets the Republicans' main criteria. It
contains spending cuts to roughly match the debt ceiling increase
through 2012. The spending cuts in the Reid plan are ones to which
Republicans have previously agreed. It contains no revenue increases.
All three of those have been what Republicans asked for. But now it is
not good enough. What do they want to do when we basically met their
demands?
Beyond all that, this compromise we have offered--mostly what they
have asked for--contains an important priority of mine--not one of the
Republicans, to be sure--and that is that we protect Social Security,
Medicare, and Medicaid.
I know that major Republican budgets--the so-called Ryan budget, the
Republican House budget--undercut our major important programs,
Medicare and Medicaid especially. We know the so-called cut, cap, and
balance proposal the Republicans have passed that is being voted on
here didn't protect Medicare, Medicaid, and Social Security. So we know
Republicans want to go after those programs. Under this compromise, we
have been able to protect that, but we need to make sure we put country
ahead of party, national interest above partisanship. That is why we
have been willing to compromise.
Speaker Boehner's plan is being revised, but so far it provides
significantly less than the savings in the Reid proposal. By design,
the Boehner plan would put us back in this situation in a few months.
What rational economist, what responsible elected official, what
businessperson in St. Paul or Columbus, in Rochester or Mansfield--what
businessperson would say: Let's put the U.S. in this situation again in
6 months?
We know what has happened in this country in the last month or so. As
we approach default, as businesses particularly watch the way this is
being debated and how this is being handled, people are way less
certain, people are way more concerned about our ability to raise the
debt ceiling and keep us out of default. Businesses are holding on to
their cash reserves because they are not willing to invest now because
they don't want this to happen.
So why would we want to go through this again in 6 months? Why would
we possibly think this is good for the United States--for people in
Chillicothe and Dayton, in Youngstown and Akron, in Canton and Kenton,
Wauseon and Bowling Green? Why would we want businesses in our country
to go through this again in 6 months?
We need to get this done quickly. We have to raise the debt ceiling
to keep us out of default. We need to make sure we focus on deficit
reduction, and we need to put our efforts into job creation. People all
over my State--when I am in Dayton, Springfield, Cuyahoga County or
Mahoney County, as I was this past weekend--people are mostly saying
they want us to focus on job growth. We need to do budget cuts and
raise the debt ceiling to keep us out of default. We mostly need to
make sure we move forward on job creation.
We prevent a default and reduce the deficit with the Reid plan--a
critical imperative for our children and our grandchildren. It protects
Medicare and Social Security and Medicaid.
My office is being swamped with calls and e-mails from Ohioans who
simply can't believe we are this close to default. Within the week,
Congress must pass and the President must sign an increase in the debt
ceiling. It is essential if we want to prevent an absolutely
unnecessary, an absolutely uncalled for, yet catastrophic default. It
is necessary to move on to address the issue of jobs. Too many recent
college graduates, too many people who have been in the workforce for
too many years, too many people who are unemployed are looking for
jobs. That is where our focus should be.
We need to pass the Reid plan, work on deficit reduction, and work on
job growth.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mr. Udall of New Mexico). The clerk will call
the roll.
The legislative clerk proceeded to call the roll.
The PRESIDING OFFICER. The Senator from Colorado.
Mr. UDALL of Colorado. Mr. President, I ask unanimous consent that
the order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. UDALL of Colorado. Mr. President, I come to the floor today, as I
think many of my colleagues have, to speak to the topic at hand, which
is the debt ceiling debate we are having in the Congress of the United
States.
I have to say, I think Americans across the country are looking at us
with disbelief, anxiety, and--I think rightly--anger. They awoke this
morning hoping to find that cooler heads had prevailed and that all of
us were working together on a plan that keeps our country from default
and our economy from looming collapse. Instead, the headlines read that
the Speaker of the House was again refusing to negotiate and that he
is, in fact, delaying action in the House because of Republican
upheaval against his own plan.
I have to say, even if the House of Representatives passed a bill
preventing default this evening, within hours, we would still be
pushing our country right up to the edge of an economic catastrophe. In
other words, what I am saying is, even though economists, market
analysts, business leaders, credit rating agencies, world leaders, and
the American people are begging us to find an agreement to avoid
default on our debt obligations, we are no further along today than we
have been in the many weeks we have been debating this issue.
As the Presiding Officer knows, as a former Member of the House, I
take no pleasure in criticizing the people's House. But it does take
two to tango, and when it comes to courting the House of
Representatives, it feels as though they have one shoe nailed to the
dance floor. I can't figure out for the life of me what it is going to
take to reach an agreement on behalf of the American people. The House
of Representatives just can't take yes for an answer.
The real problem, at least in my estimation, seems to be that a small
group of people are set on running up the political score rather than
doing the
[[Page S4933]]
right thing for our country. If that is the case, now is the time to
finally come to the table.
Here is the truth: Many of us here are trying to prevent our economy
from driving off a cliff, but others seem to be busy cutting the brake
lines. On that point, I was proud of the Senate and the Democrats and
Republicans who came together on the bipartisan Bowles-Simpson
Commission and came up with a plan on reducing the deficit. They were
willing to be a part of the solution.
The Bowles-Simpson Commission recommended taking important but
difficult steps to reduce our debt by $4 trillion over the next decade.
That plan is the right one for the country, and despite the significant
political risks attached to taking those positions, Senators in both
parties were willing to support it. The House Members, on the other
hand, when the fiscal commission offered them the bipartisan deficit
reduction plan, walked away, both Democrats and Republicans, to be
fair.
Unfortunately, this has become a pattern. When Vice President Joe
Biden and House Majority Leader Eric Cantor were close to finally
reaching an agreement on a deficit reduction plan, it was the House
Republicans who walked away. When President Obama and Speaker Boehner
sought to strike a ``grand bargain,'' to do something great for the
country, the House walked away. President Obama likened this to being
left at the altar, but I cannot think of any description that is more
apt than ``irresponsible.''
For my friends and my colleagues who know me, I am not quick to
anger. But I have to say, time is not our friend here and we cannot
delay action any longer. I was pleased to see Senator Alexander, the
third ranking Republican in the Senate, say last night:
What would be best, instead of having a Republican plan
competing with a Democratic plan, would be to have the
Speaker, Senator Reid, and Senator McConnell recommend to us
a single plan.
I understand the Senate leaders are speaking frequently, and I have
all the faith in the world that the Senate could work this problem out.
But that is only half the problem. We need statesmen, we need patriots,
we need problem solvers over in the House to emerge. Campaign politics
and partisan talking points do not take courage. Now is the time for
courage and leadership.
Instead of going back to the drawing board on the Boehner plan, we
need to refocus our efforts on a plan that meets three tests. Such a
plan has to, No. 1, raise the debt limit to avoid a first ever Federal
Government default; No. 2, provide enough certainty to investors that
America will pay its bills to stave off a downgrade in our credit
rating; and, No. 3, reduce the deficit enough that we can begin the
hard work to get our fiscal house in order.
The Reid plan, in my estimation, achieves each of those goals. While
I am disappointed we could not all come together on a larger $4 to $5
trillion deficit reduction package that would be both bipartisan and
comprehensive, the Reid plan adequately addresses the most pressing
issues that confront us, which are preventing a default and staving off
a downgrade in our credit rating.
The Boehner plan, on the other hand, is only a short-term fix, and a
host of economic forecasters and business leaders have said it would
almost certainly lead to a downgrade in our, in America's, credit
rating, which would raise interest rates, could sabotage seniors'
retirement savings, and increase consumer costs on almost every
American.
Bank of America, Standard & Poor's, JPMorgan Chase, and other major
players have all warned us that future economic instability and short-
term political solutions will almost certainly lead to a downgrade in
our credit rating. That is some serious business.
What is sad about all of this is that the unstable political
climate--which one observer called ``amateur hour on Capitol Hill''--
itself may lead to a downgrade.
I respect the Speaker's desire to go back to the drawing board to try
to secure more Republican votes, but the fact is we do not have time.
The Reid plan is ready to go, and it meets the three-part test I laid
out. In fact, the Congressional Budget Office stated that the Reid plan
reduces the deficit by twice as much as the House Republican plan. As
reported this morning ``in the battle of budget scores, the Senate
Democrats deficit reduction bill is the clear winner thus far.''
Our economy has been in critical condition, and I think we are
feeling recently that it is beginning to come back to life, that we
have been nursing it back to health. The last result we need is a self-
inflicted heart attack caused by an overdose of partisanship. People
wonder why we cannot get it done.
I know the Presiding Officer is a mountain climber, as am I, and we
are both, I guess, old mountain climbers in more ways than one. I can
tell you that there are some similarities between attempting to climb
the world's highest peaks and our work here in Washington. But the
difference seems to be, especially when the going gets tough here on
Capitol Hill, that not only are you trying to conquer mountainous and
challenging and difficult terrain, you seem to have a team of saboteurs
here who are trying to push the rest of us off the mountain as we are
trying to climb it. The Scots have a saying: It is not the falling off
that hurts. It is the sudden stop at the bottom. I can tell you, if we
do not raise the debt ceiling, that is going to involve a sudden stop
at the bottom for all of us.
The people of Colorado have told me--and I suspect the rest of the
Nation feels this way--they do not care who wins politically. Frankly,
I do not care who wins politically either. What I care about is passing
legislation that will stave off government default and a downgrade in
our Nation's credit rating. At this point, the Reid plan is the only
option that meets that criteria. Let's get it done. Let's get it done.
Tribute To Hillary Daniels
Mr. President, as I close, I want to change the tone of my remarks a
little bit because there are wonderful people who work here on Capitol
Hill and make a difference day in and day out, and I want to recognize
Hillary Daniels, who has been one of my budget and appropriations
legislative assistants, who joined my team when I first came to the
Senate 3 years ago.
She is a native of Colorado's western slope, the great county of Mesa
and the town of Grand Junction. She is going to be leaving my office
next month to go to law school at Washington University in St. Louis,
MO.
She has been an invaluable team member, and I can speak for my entire
staff when I say we are both excited for her to take this next step in
developing her career and I am very grateful for the guidance she has
given me over the last few years.
It is for the Hillary Daniels of the world, who will be leaders of
our country in the next decade and the decade after that, that I think
we owe an obligation to getting this job done as soon as we possibly
can, assuring the markets that the full faith and credit of the United
States will be preserved and protected and nurtured.
Let's turn back to job one here, which is to focus on our economy and
job creation. The longer we are stalled out in a political crisis of
our own making, the less we are concerned and focused on putting the
American people back to work.
Mr. President, thank you for your interest, thank you for your
attention.
I yield the floor.
The PRESIDING OFFICER. The Senator from Illinois is recognized.
____________________