[Congressional Record Volume 157, Number 120 (Tuesday, August 2, 2011)]
[Senate]
[Pages S5201-S5223]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           AMENDING THE EDUCATION SCIENCES REFORM ACT OF 2002

  Mr. REID. Madam President, I ask the Chair to lay before the Senate 
the House message to accompany S. 365.
  The ACTING PRESIDENT pro tempore. The Chair lays before the Senate a 
message from the House, which the clerk will report.
  The assistant legislative clerk read as follows:

       Resolved that the bill from the Senate (S. 365) entitled 
     ``An Act to make a technical amendment to the Education 
     Sciences Reform Act of 2002'' do pass, with an amendment.

  Mr. REID. Madam President, as provided under the previous order, I 
now move to concur in the House amendment to S. 365.
  The ACTING PRESIDENT pro tempore. The motion is pending.
  Mr. REID. Madam President, Senator McConnell and I have completed our 
statements.
  The ACTING PRESIDENT pro tempore. The Senator from Tennessee.
  Mr. ALEXANDER. I ask unanimous consent to speak for 10 minutes under 
the time allocated to the Republican side.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. ALEXANDER. Madam President, finally, Washington is taking some 
responsibility for spending money that we don't have. At a time when 
the Federal Government is borrowing 40 cents of every dollar it spends, 
this is a welcome change in behavior. I gladly support it. Make no 
mistake, this is a change in behavior--from spend, spend, spend, to 
cut, cut, cut. Let me give you one example.
  On Christmas Eve 2010 Congress raised the debt ceiling and attached 
to it $1 trillion in new spending over 10 years in the new health care 
law. This time, for every dollar we are raising the debt ceiling, we 
are reducing spending by a dollar, not adding to it. This reduction in 
spending over 10 years is about $2.4 trillion.
  Here is another example: According to Senator Portman, who used to be 
the Nation's budget director, the CBO would say if Congress did this 
kind of dollar-for-dollar reduction for spending every time a President 
asked us to raise the debt ceiling, we would balance the budget in 10 
years.
  Here is another: The Wall Street Journal reported yesterday that 
because of these spending cuts, the discretionary part of the budget, 
which is about 39 percent of the entire Federal budget, will grow over 
the next 10 years at a little less than the rate of inflation. If we 
could control the rest

[[Page S5202]]

of the budget so that it would grow to anything close to the rate of 
inflation, we would balance the budget in no time.
  Balancing the budget is exactly what our goal ought to be. I did it 
every year as Governor of Tennessee. Families in America do it every 
day. It is time to balance the government's books and live within our 
means.
  These spending reductions are an important step, but they are just 
one step, and no one should underestimate how difficult the next steps 
will be. These spending cuts do almost nothing to restructure Medicare 
and Social Security so that seniors can count on them and taxpayers can 
afford them.
  The President's budget projections still double and triple the 
Federal debt. Under the President's budget, according to the CBO, in 10 
years we will be spending more in interest on the debt than we now 
spend on national defense.
  In January 2013, the very first thing the next President will have to 
do is to ask the Congress to increase the debt ceiling. This problem 
wasn't created overnight, and it will not be solved overnight. If I 
were sitting at Union Station trying to catch a train to New York and 
someone offered me a ticket to Philadelphia or Baltimore, I would take 
it, and I would find a way to get to New York from there.
  Today's vote is an opportunity to take an important step in the right 
direction, toward stopping Washington from spending money it doesn't 
have. We should take it and then get ready to find ways to take the 
next steps.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Illinois.
  Mr. DURBIN. Madam President, this is a historic vote. It is one that 
has involved a lot of emotion and soul searching and a lot of hard 
work. The leaders are on the Senate floor--the Democratic and 
Republican leaders of the Senate, Senators Reid and McConnell. I salute 
both of them for working so hard to bring us to this moment where we 
have an opportunity to vote.
  The House has passed this legislation, the so-called Budget Control 
Act. The Senate will take it up shortly. It is my belief it will also 
pass in the Senate. But my vote for this legislation does not come 
without some pain.
  We are told in life to follow our conscience. On this matter, my 
conscience is conflicted. If this bill should fail, we will default on 
our Nation's debt. That will be the first time that has ever happened. 
If we should default at midnight tonight on our Nation's debt, terrible 
consequences will ensue. We will find America's credit rating in the 
world diminished, the interest rates we pay as a nation increased, and 
the cost of money for businesses and families across the United States 
will increase--at exactly the wrong time, in the midst of recession.
  If we fail to pass this legislation, tomorrow the Secretary of the 
Treasury will sit down with the President and decide in the month of 
August which Americans who were expecting a check will actually receive 
one. Will we pay Social Security recipients? Will we pay the members of 
our military? Will we pay the Central Intelligence Agency? It is an 
impossible choice that the President would face if we fail.
  But there is another side to the story. If this bill passes, we will 
reduce spending on critical programs. We have to be honest about it. 
Fewer children from poor families will be enrolled in early childhood 
education. Working families and their children will face even more debt 
to pay for a college education. Medical research will likely be cut. 
And the list goes on. So from where I stand, it is not the clearest 
moral choice.
  I spoke to our Chaplain before we started the session about a line in 
Shakespeare I have always struggled to understand. It is from Hamlet, 
and it is the line in his famous soliloquy, when he said: ``Conscience 
makes cowards of us all.''
  This morning, I still cannot clearly articulate what it means, but I 
feel it--struggling with this conscience question of defaulting on our 
debt, with all of the consequences on innocent people across America, 
and passing this bill with all of the consequences on innocent people 
in America. I have spent the last year and a half focused on this debt 
situation as I have never been focused before. I understand it a little 
better today than I did when I started.
  I have come to the conclusion that if we are going to be honest about 
our debt and about reducing it, we have to be honest about how it will 
happen. Sure, we must cut spending; that is where we have to start. But 
we also have to understand it goes beyond that.
  We have to be prepared to raise revenue. In the Bowles-Simpson 
Commission and the Gang of 6, I thought we came up with an honest 
answer to that question. It was a balanced approach and put everything 
on the table. Well, this bill makes a serious and significant 
downpayment in spending cuts. Now a joint committee is created to take 
the next step.
  I will say this: If the next step is to be fair, if the next step is 
to be serious, it has to go beyond spending cuts. It has to look at 
serious questions about how we can save money in entitlement programs 
without compromising our commitment, and how we can ask those who have 
profited so well in America, who live so comfortably, to join us in 
this effort by paying more in taxes. That is the stark reality.
  If we continue to move toward more and more spending cuts, we will 
literally disadvantage the poor and working families of America to the 
advantage of those who are well off. That is not fair, and it is not 
right. Many people have criticized this, saying we don't even read 
these bills we vote on.
  Yesterday, I sat down to read this bill--it is not that long. I have 
to say, the front end of the bill is almost unintelligible. A person 
needs someone from the Budget Committee sitting next to them to explain 
each paragraph. I basically understand that portion of it. I also 
understand the portion that Senator McConnell proposed on how we will 
sequence requests for increases in the national debt. I certainly 
understand, and am puzzled in some ways, by the joint committee's basic 
charge to find in 10 weeks anywhere from $1.2 trillion to $1.5 trillion 
in savings over the next 10 years--in 10 weeks, these 12 members of the 
House and Senate are to reach an agreement. It is a daunting task.
  There is one provision I want to call to the attention of the Senate. 
It troubles me greatly. It is a provision that requires that the Senate 
and House of Representatives, before December 31 of this year vote on a 
constitutional amendment to balance the budget. I searched this bill 
long and hard to find the language of that constitutional amendment 
because I thought, if we are going to have to face the prospect of 
amending the Constitution, I want to know what the language is. This is 
an awesome responsibility.
  One can read this bill from top to bottom, and there is not one word 
of substance about that amendment. All it says is, the House and Senate 
shall consider a bill that is a ``joint resolution to amend the 
Constitution of the United States to balance the budget.'' End of 
sentence, end of reference in this bill.
  It gets better. Not only do they require us to take a balanced budget 
amendment and fail to include the language of that amendment--listen 
closely--this bill says there shall be no amendments to the proposed 
resolution in committee in the House or on the floor of the House, in 
the committees of the Senate nor on the floor of the Senate--take it or 
leave it.
  As I say these words, I can imagine Robert C. Byrd descending from 
heaven, standing at that desk and waving this Constitution and 
reminding Members of the Senate that one of the few times in our lives 
when we have taken a solemn oath, Members of the Senate swore to uphold 
and defend this document, this writing. He would find it nothing short 
of outrageous that we are mandating a vote on a constitutional 
amendment that is not even written, that we are prohibiting the House 
and the Senate from even considering the change of one word in that 
proposed constitutional amendment.
  Madam President, I think the language of this bill entirely 
discredits this effort toward a constitutional amendment. We cannot 
take it seriously if we take our oath seriously to uphold and defend 
this document.
  At the end of the day, I will vote for this measure, obviously with a 
heavy heart. There are parts of it I will struggle to explain and 
defend, but I can't let this American economy descend into chaos if we 
fail to extend the debt

[[Page S5203]]

ceiling. The job ahead will be hard, but let's hope we will, in 
reducing this deficit further, do it in a balanced and fair way, with 
everything on the table.
  At the end of the day, Members of Congress and people in higher 
income categories should feel they too are called to sacrifice. If we 
ask that of the poorest in America and of working families, we can ask 
no less of Members of Congress and those who are well off in this great 
Nation.
  Madam President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The other Senator from Illinois.
  Mr. KIRK. Madam President, although this bill reflects a balanced 
approach, Americans also expect a balanced budget. We need to apply the 
common sense of the heartland to spend within our means, as each family 
does with their monthly budget.
  The battle over this legislation was hard fought. We have finally 
started to change a 40-year culture of overspending and overborrowing 
in just 40 days. We hear the American people, and we respect their 
judgment. They tell us they are not undertaxed. They tell us Washington 
overspends.
  We have a government that claims to support a strong economy but 
urges tax increases that will weaken it. We hear speeches from some who 
want to expand employment but then attack employers. They argue for 
more access to credit but then assail the banks that would provide it. 
They call for more American energy but decry the very explorers who 
would find it. We need more straight talk and accountability.
  Small businesses provide the most jobs, and we should reward them. 
Inventors create new economies, and we should encourage them. Many 
government programs fail in their objectives, sometimes for decades, 
and we should cancel them. We face mounting government debt. The way to 
pay this debt is to generate more jobs, creating more taxpayers who 
will provide additional revenue, not new Federal job-killing taxes.
  Given the views of our President and the economically liberal Members 
of this Senate, the legislation before us is the best deal we can get. 
This legislation caps regular appropriations of the Congress. It 
eliminates procedural impediments so that we will vote on how to cut 
automatic spending programs. We even installed automatic spending 
programs regardless of congressional gridlock as a backstop to ensure 
fiscal responsibility. This bill prevents a crisis from breaking out 
this week. It also begins to control automatic spending programs, many 
of which have run without much accountability since the 1960s. All of 
this is a downpayment on further ways to bring commonsense 
accountability and control to the spending of our government.
  These basic values are the foundation of America's 200-year 
experiment in self-government. If we fail, we deliver a free people 
into the hands of a financial bondage. If we succeed, we honor the 
promise of limited government that offers greater and greater liberties 
to each generation of Americans so that they can reach their own 
potential.
  I will vote for this legislation because it begins to make the hard 
choices to keep us free. But it is only a first step, and a crucial 
one, to increase the transparency, the performance, and results we 
should demand from America's government.
  This bill sets an important precedent to reform automatic spending. 
If we use that precedent again, then I can imagine an America that once 
again becomes the best place on Earth for inventors and families to 
start and expand businesses that will provide for their children and, 
in a few cases, will span the globe with American exports to each 
market of the planet.
  Madam President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from New Mexico.
  Mr. UDALL of New Mexico. Madam President, over the past 2 years, our 
country has been struggling to recover from one of the worst economic 
recessions in our history. Democrats have worked to pass legislation 
that would create jobs. It has been our top priority. But at every 
turn, we faced resistance from ideologues who care more about winning 
political points and protecting the wealthy than doing what is right 
for hard-working American families.
  That is exactly what happened during this debt-ceiling debate. 
Instead of passing a clean extension and getting to work on our 
economy, we have been forced to vote on a last-minute deal to prevent 
the economic catastrophe that would result in default.
  I spent the last few weeks and months highlighting the real-life 
consequences of default for New Mexico families. At a time when 
families are already dealing with extremely tight budgets, a default 
would mean increased costs for just about everything, from food, to 
gas, to housing, to sending the kids to college. It would also 
jeopardize critical Federal benefits that veterans, seniors, and others 
depend on to pay the bills and stay healthy. It would mean more than 
360,000 New Mexicans would be in danger of losing their Social Security 
benefits. It would mean another 300,000 who rely on Medicare seeing 
their health care disrupted. It would mean 174,000 New Mexico veterans 
may not receive their benefits, and more than 1,400 Active-Duty 
military personnel may not receive paychecks for their services.
  But it wouldn't stop there. Even if you don't depend on a check from 
the Federal Government every month for health care or retirement or 
other benefits, you would still feel the financial pain of default. 
That is because mortgage payments would increase by more than $1,000 
for the average family and credit card interest would go up by $250. 
Why is that, you ask. Because the interest you pay on just about every 
loan you have, whether it is a house or a car or college tuition, is 
based on the interest rates the Treasury pays, and if that interest 
rate rises, as it would in a default, so does the interest rate on just 
about everything else. New Mexicans can't afford that. America can't 
afford that. And it is to prevent New Mexico families from these 
repercussions that I will vote for this legislation. But that is the 
only reason because, to be frank, almost everything else about this 
deal stinks, and it stinks to high heaven.

  As my friend the good Senator from Vermont said yesterday, this 
package is grotesquely unfair and bad economic policy. While I firmly 
believe we must take steps to rein in our deficit, this package is far 
from the ideal way to do so.
  I hear every day from New Mexicans about the need to rebuild our 
economy. We should be investing in innovation and infrastructure and 
creating new jobs, but we don't do that with this deal. Instead of 
cutting excess and investing wisely in programs that create jobs, this 
package will mean fewer dollars for job training, education programs, 
and housing, hampering our ability to create a long-term recovery.
  Poll after poll shows a majority of Americans support shared 
sacrifice in this recovery. Unfortunately, this package also falls 
woefully short on that count. While we did manage to protect important 
programs such as Social Security, Medicare, Medicaid, and nutrition 
assistance programs, there are still many important programs that will 
be on the chopping block, initiatives such as housing assistance, help 
for small businesses, and rural economic development programs, just to 
name a few--this all the while the tax cuts for the wealthiest 
Americans and large corporations remain untouched.
  This package is what happens when ideologues bent on nationalizing 
their extreme agendas get their way. The fracture we have seen among 
Republicans in the House over the last few months has much broader 
effect than just in that Chamber. Their staunch refusal to compromise 
at the expense of struggling families has pushed this debate and our 
Nation to the brink.
  Instead of having a frank conversation about how we can repair our 
economy and reach a simple compromise, we have been forced to vote 
today to avoid default. With this plan, we get nowhere near the heart 
of our economic problems. Instead, we kick the can down the road a 
couple of years, all the while the problem continues to grow, impeding 
our recovery and crippling our economic competitiveness.
  Once this vote is taken and the immediate crisis is passed, it will 
be all too easy to stick our heads back in the sand and pretend 
everything is OK. I rise today to say this: Everything is not OK, and 
it won't be OK until we have the courage and leadership to institute 
tax reform--not just trimming

[[Page S5204]]

around the edges or rearranging the numbers to create the illusion of 
savings when, in fact, nothing has changed; I am talking about 
substantive tax reform that is the result of a national conversation 
about our priorities as a society. We have the opportunity to do just 
that with the commission being created by this plan, but it will take 
guts and leadership and hard choices.
  Our national deficit is a burden that drags us down competitively and 
requires serious negotiations, not just concessions to those who see 
this as a political opportunity to push their personal agendas. We must 
all come to the table and do what is best for our Nation.
  I see the Senator from Florida is here. I know he is a wise gentleman 
who has much to say to us.
  So with that, Madam President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Florida.
  Mr. NELSON of Florida. Madam President, again I say to my colleague 
from New Mexico what a fine Senator he is, as is the Senator presiding. 
What a privilege it is to serve with the likes of the both of you. 
Indeed, the Members of this body are extraordinary individuals, and we 
have all anguished with what we have been through as the clock was 
constantly ticking down to midnight tonight and knowing the 
consequences.
  This Senator always had the feeling that it was going to work out, 
that we were going to reach agreement. Interestingly, the financial 
markets had that same feeling as well because the financial markets 
never did go off a cliff. Even the Asian financial markets felt the 
same thing as we were coming out of the weekend. Even though we, in 
this capital city of our Nation, have gone back and forth over ways to 
cut this public debt, here we are, we have an agreement. Members of 
this body, as well as the other body down at the other end of the 
Capitol, clearly are sincere in their differences. But I think what we 
saw in the overwhelming vote yesterday in the House of Representatives 
was most of the Members agree that gridlock doesn't do anything to help 
the country, and especially the economy. So we have this compromise 
plan in front of us, and later today one of two things will be true: 
Either we will have done what is in the best interests of the American 
people or we will have failed. I think, overwhelmingly, what we will 
see when we vote at noon today is that there may be as many as 75 
Members of this 100-Member Senate who will vote in favor of this 
package.

  I think not only is it obvious this package is the way to avoid 
default, but it starts us on the path of getting serious about what we 
have to do. The plan contains more than $2 trillion to bring down the 
deficit over the course of the next 10 years, according to the 
Congressional Budget Office, and it is going to cut about half of that 
now. It leaves the rest of it up to a supercommittee of 12 Members--
half from the House of Representatives, half from the Senate--with each 
half appointed by its respective leaders of the Chambers.
  It is possible this supercommittee will deadlock, but I think with 
the concern about the financial precipice we have been teetering on, 
that supercommittee is going to come up with a plan for significant 
deficit reduction. They have a target of an additional $1\1/2\ trillion 
over the next 10 years, but they are not limited to that, and 
everything is on the table. What they could do--and this is a moment, 
if we can seize it, that would be tremendous--is set us on the path to 
do major tax reform. No one is happy with the existing Tax Code. We 
talk about all these tax loopholes--the technical term is tax 
expenditures--and they are simply special interest tax preferences for 
individual special interests. It blows my mind to realize they will 
cost $14 trillion over the next 10 years. Why should this one special 
interest have a tax preference and this one have a tax preference, and 
yet we find it difficult, as we go through this harangue here in our 
debate, as to what is the level of the tax bracket for taxation on 
ordinary people?
  What we could do--and the supercommittee can do this--is take a lot 
of those tax preferences--that $14 trillion worth of them--and by 
taking only 15 or 20 percent of those away and utilizing that revenue, 
we could simplify the Tax Code into three tax brackets for individuals 
and lower everybody's tax in that income bracket, and we could lower 
the corporate income tax. That is a real possibility for this 
supercommittee. They could give the instructions back to the Ways and 
Means Committee in the House and the Finance Committee in the Senate 
and then start to do reform, as well as bringing down the national 
annual deficit. The backup, if this supercommittee fails to agree, is a 
series of spending cuts that automatically happens.
  This agreement also calls for a vote on a balanced budget amendment. 
I have voted for balanced budget constitutional amendments in the past, 
and we are going to have another opportunity to vote for one. I assume 
we are going to have a vote for two different versions. The version 
that is being offered by Senator Udall is the one I intend to vote for.
  So here we are with a plan that is not a perfect plan, although it 
clearly avoids default. But all of us agree on what it must do: 
Government spending must be cut, the public debt must be reduced; 
otherwise, our economy will not recover and America will no longer be 
in good standing around the world. That is the bottom line.
  I often quote from the Book of Isaiah, in which the Lord is speaking 
to the people and he says:

       Come now, let us reason together.

  Isn't that so true here? And was it not avoided for so long, where 
reasonable people of good will--and every one of these Senators is a 
person of good will--could not get out of our ideological rigidity and 
out of our momentary excessive partisanship so that we could, as the 
Good Book says, ``Come now, let us reason together?'' But I think now 
that is what we have done.
  So when we pass this legislation--and it will be an overwhelming 
vote--in about 2 hours, and the President then signs it into law, we 
can turn our attention back to the economy and creating jobs, which we 
so desperately need to bring us out of this recession that has been 
lingering far too long.
  Madam President, I thank the Chair for this opportunity, and I yield 
the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Michigan.
  Mr. LEVIN. Madam President, I understand we are alternating?
  The ACTING PRESIDENT pro tempore. That is correct.
  Mr. LEVIN. I would request, after the Senator from Kentucky, who is 
here to speak--
  The ACTING PRESIDENT pro tempore. I am sorry, the Parliamentarian has 
corrected me. There is no agreement to alternate.
  Mr. LEVIN. In that case, I believe I was here on the floor before the 
Senator from Kentucky, so I will proceed.
  The ACTING PRESIDENT pro tempore. The Senator from Michigan.
  Mr. LEVIN. Madam President, to say the legislation before us is not 
ideal is truly an understatement. The notion that our deficit problem 
can be solved solely by cutting spending flies in the face of our 
experience, when in fact unwise tax cuts for the wealthy and egregious 
tax loopholes are significant culprits in our fiscal crisis. I believe 
too many Republicans are influenced by an ideology so extreme that it 
promised to wreak economic havoc if they did not get their way. ``No 
additional revenues'' became the battle cry--an approach that prevents 
the balanced deficit reduction the American people rightly support. The 
result is that this legislation incorporates some policies that are 
profoundly unfair to middle-income Americans.
  Seen in isolation, Madam President, this is not a good bill. But no 
public policy exists in a vacuum. Despite its many flaws, this 
legislation must pass. Let me explain why.
  While there will be a number of negative consequences as a result of 
this bill's passage, there will be more dire consequences if it fails 
to pass. The choice here is between a faulty piece of legislation on 
the one hand and severe damage to our economy and even greater 
joblessness on the other. The choice we face with this vote today is 
whether to accept a flawed bill or to watch the United States--the 
globe's preeminent economic power--default on its obligations to senior 
citizens, students, and veterans, as well as to

[[Page S5205]]

those who have invested in our country by the purchase of our bonds and 
our Treasury notes. We have taken many steps in the past 3 years to try 
to restart job creation in this country. Those efforts would come 
undone in the crisis that would follow our failure to pass this bill.
  One of the things that is right about this legislation is that it 
avoids a misguided demand that we have another round of crisis and 
negotiation over this issue in a few short months. A short-term 
increase in the debt limit, as House Republicans demanded, would surely 
have led to a damaging downgrade of the government's credit rating. It 
would have frozen financing for businesses and consumers. We simply 
cannot put the American people and the American economy through that 
again.
  Despite this bill's imbalance in focusing solely on spending cuts, it 
does contain a mechanism that can force acceptance of what our 
Republican colleagues have refused to accept--the reality that revenue 
must be a part of real deficit reduction and that fair and effective 
deficit reduction efforts require shared sacrifice. The year 2011 is 
the year of unbalanced spending cuts, and 2012 must be a year of shared 
sacrifice, one in which the President uses the bully pulpit to lead the 
Nation to accept the notion that everyone--including, surely, the 
wealthy--must play a role in reducing deficits.
  Democrats have repeatedly emphasized this point. It is a simple fact 
that among the largest factors contributing to our deficits is the Bush 
tax cuts--tax cuts that greatly increased the growth of the gap between 
the wealthiest among us and working families. Today, median household 
income--the income of the typical American household--is lower than it 
was in the mid-1990s, and yet the wealthiest Americans not only do 
extremely well, they are doing better and better all the time. A few 
decades ago, the wealthiest 1 percent of all Americans took in 10 
percent of all income. Today it is 24 percent.
  These numbers are not aberrations or actions of a free market. They 
reflect policy choices. Too often the choice has been to pay lip 
service to the middle class while driving income inequality to levels 
not seen in 80 years in this country. The failure to ask all Americans 
to join in the sacrifices required to reduce our deficit flies in the 
face of logic and fairness and threatens to increase the growing gap 
between upper income and middle-income families.
  Democrats have proposed commonsense steps to address the failure to 
include more revenue and to promote shared sacrifice. We have proposed 
restoration of the 39.6-percent tax bracket for the wealthiest 
Americans who make nearly $400,000 a year or more. Most Democrats 
support the end of tax breaks for the massively profitable oil 
companies. We seek to close loopholes that now allow tax dodgers to 
hide income and assets in overseas tax havens to avoid the taxes they 
rightly owe and to end tax breaks that let highly-paid hedge fund 
managers enjoy a lower income tax rate than the rate their employees 
pay.
  So far, too many have denied the need for these changes. But there is 
a chance at least that this legislation may finally force consideration 
of added revenues, added fairness in the Tax Code, and the shared 
sacrifice that is so missing from the cuts in the legislation before 
us.
  Why is that? Under this legislation, we will face a stark choice. We 
must agree before the end of this year to deficit reduction of at least 
$1.2 trillion over 10 years, or stand by as an automatic budget cut 
kicks in to accomplish that goal. A bipartisan joint committee of 12 
Members of Congress will meet and develop a deficit reduction plan that 
avoids those automatic cuts. That joint committee will have broad 
powers to review and propose changes to spending and to the Tax Code, 
and to add revenue. Revenues will finally be back on the table where 
they have always belonged.
  Meeting that $1.2 trillion goal will not be easy, but it will be 
achievable--achievable, that is, if those who so far have been 
unwilling to compromise will recognize that revenue must be part of the 
equation. Nobody should be eager for the automatic cuts that would 
otherwise take effect. Many of those cuts would be unacceptably painful 
and damaging. But the very idea of those automatic cuts is that they 
are so unacceptable that few of us will want to see them enacted and 
most of us will be willing to compromise in order to avoid them.
  Congress used this approach once before. In 1985 we passed Gramm-
Rudman-Hollings, which set forth specific deficit targets and required 
cuts if those targets were not met. The framework for today's 
legislation is based on that model. As one of the authors of the Gramm-
Rudman-Hollings act, Senator Gramm put it:

       It was never the objective of Gramm-Rudman to trigger the 
     sequester; the objective of Gramm-Rudman was to have the 
     threat of the sequester force compromise and action.

  And it did. For example, in 1990, when facing the possibility of 
unacceptable cuts in defense and other important programs, President 
Bush and bipartisan leaders in Congress adopted a balanced deficit 
reduction plan that included significant new revenues. The Damocles 
sword of the Gramm-Rudman-Hollings deficit reduction act was the reason 
for that outcome. I believe that any plan from the bipartisan committee 
that fails the test of balance will have no chance of passage in the 
Senate. That means members of the committee must truly be willing to 
lead, to put aside partisanship and rigid ideology, if we are to avoid 
triggering unacceptable cuts. Success also is going to require 
Presidential leadership and stronger use of his bully pulpit.
  Democrats have demonstrated that we are willing to put forward 
serious deficit reduction proposals, plans that include painful cuts to 
important priorities. With a vote to approve this bill, which we must, 
it is my hope that we have reached the high tide of an ideological 
movement that has sought to hold tax cuts for the wealthy sacred while 
imposing increasingly Draconian cuts on programs for American families 
and threatened economic calamity if that movement did not get its way. 
The era of slashing programs that help middle-class Americans, with no 
shared sacrifice by the wealthiest among us, must end and give way to 
an era in which fairness and balance guide our efforts. Passing this 
legislation today hopefully will drive us to make that transition.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Kentucky.
  Mr. HATCH. Will the Senator yield?
  Mr. PAUL. I will.
  Mr. HATCH. I ask unanimous consent that I be permitted to give my 
remarks immediately following the Senator.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  The Senator from Kentucky.
  Mr. PAUL. Madam President, America will not default on her debt 
today. In fact, there was never any doubt that America would pay her 
bills. But mark my words, America will default. America will default, 
not by not paying its bills, not by not raising the debt ceiling, but 
we will default in a more insidious way. America will default by 
increasingly paying our bills with money that is worth less and less 
each year.
  A nation pays for its debt in three ways. We can either tax people, 
we can borrow the money, or we can simply print the money. They all 
have repercussions.
  We are approaching our borrowing limit as a nation. We now owe China 
over $1 trillion. We owe Japan nearly $1 trillion. We even owe Mexico. 
As we reach our borrowing limit, interest rates will rise and the 
prices in the stores will rise. You are already seeing this in your 
grocery stores. You are already seeing this in your gas prices. They 
are not rising de novo, out of nothing. Your prices are rising because 
the value of your dollar is falling. The value of your dollar is 
falling because they are printing up money to pay for this exorbitant 
debt.
  In 2008 we went through a banking crisis and we doubled the monetary 
supply in 4 months. We bought things. The Federal Reserve bought toxic 
assets. They bought bad car loans and bad home loans. Where once upon a 
time your dollar was backed by gold, your dollar is now backed by toxic 
assets--not a very comforting thought.
  Many pundits are arguing that the tea party has won this battle. They 
misunderstand the debate. This battle is not about winners and losers, 
it is about the future of our country. It is

[[Page S5206]]

about saving ourselves from ourselves. We are headed toward ruin if we 
continue on this path of spending money we do not have.
  For decades, America has lived beyond her means. A nation that lives 
beyond her means will eventually live beneath her means. That day is 
coming. A day of reckoning looms. That day was never August 2. That day 
is when the dollar teeters and falls from its perch. That day is when 
prices soar. That day is when unemployment and a declining standard of 
living foment discontent and unrest in the street.
  As Erskine Bowles put it, there has been no more predictable crisis 
in our history. We have been given all the warning signs. It comes, and 
this deal will not escape the facts that are looming for us. The 
President thinks that we need a balanced approach. America thinks we 
need a balanced budget and that we should not spend money we do not 
have; that since American families have to balance their budgets, why 
in the world would we not require our Government to balance its budget? 
What America needs is a balanced budget in an economy that grows and 
thrives and creates jobs.
  Yes, a malaise hangs in the air. America is a ship without a captain. 
Instead of the President chastising job creators and preaching class 
envy, we need a President who will show us leadership. The President 
needs to accept responsibility for an economy that has worsened under 
his failed leadership. Unemployment is up, gas prices have doubled, and 
this President will add more debt than all 43 Presidents combined.
  America got a deal on August 2 but not a solution. What America wants 
is a solution, not a deal. I hope in the next 6 months the President 
will find it within himself to lead the Nation, the courage to lead and 
embrace reform, the reform that is necessary to get this great country 
going again.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Utah.
  Mr. HATCH. Madam President, I compliment the senior Senator from 
Kentucky for his good remarks on the floor and for allowing me that 
unanimous consent request.
  We are coming down to the wire here. We will soon be voting on a 
proposal that would couple some deficit reduction with an increase in 
the statutory debt limit. There are some positive features in this 
legislation, and the Senate's minority leader, the Speaker of the 
House, and conservatives throughout the country should be commended for 
insisting on them.
  First, the President asked for a clean debt limit increase, and 
conservatives refused. They held the line and made clear that any 
increase in the debt limit required matching deficit reduction.
  Second, having lost the fight over a clean debt limit increase, the 
President insisted on a balanced approach to deficit reduction, by 
which he meant reducing the deficit by raising taxes. But conservatives 
again fought this back. They knew that the primary driver of our debt 
is spending. Regardless of the President's talking points, nondefense 
discretionary spending is at historic levels. We are set for our third 
straight trillion dollar deficit. We have a national debt of $14.5 
trillion, and the President's budget would give us $13 trillion more in 
debt. The answer to this is not giving the government more money to 
spend.
  And third, conservatives resisted the effort by the President's 
allies to push most of the deficit reduction in this package down the 
road.
  So there are some achievements in this proposal that conservatives 
can hang their hat on.
  But I regret to say that I will not be able to support it, because it 
does not sufficiently provide us with the solution to the debt crisis 
that the markets are demanding. Last week, Moody's made clear that the 
real threat to America's Triple A rating is not default, which even the 
administration now acknowledges was never going to happen. The real 
threat of a downgrade comes from a failure of will. It comes from a 
failure of presidential leadership in getting federal spending under 
control.
  There is a solution to this spending crisis. It is cut, cap, balance, 
which I was an early supporter of. In addition to providing short term 
relief by cutting and capping spending, it provides for a long-term 
solution through passage of a strong balanced budget amendment.
  This proposal falls well short of cut, cap, balance, and I cannot 
support it.
  I would like to address a technical point about this package that 
raises concerns for me--whether the President is looking to the deficit 
reduction committee as an opportunity to raise taxes. He says that he 
is, as have some of my colleagues in the Senate.
  I do believe that it will be very difficult, given the committee's 
charge to reduce the deficit, to raise marginal tax rates. However, I 
worry that some Democrats will be looking at tax expenditures in order 
to hit the committee's required deficit reduction targets.
  This would be a mistake for a number of reasons. The President has 
referred to tax expenditures as ``spending through the Tax Code.'' But 
rhetoric aside, tax expenditures are an opportunity for individuals and 
businesses to keep more of the money that they earn. And getting rid of 
tax expenditures, without corresponding reductions in tax rates, will 
result in a net tax increase on the American people.
  The President would have you believe that getting rid of tax 
expenditures is acceptable, because they only impact the rich. That is 
why he talks about bonus depreciation for jets and yachts used as 
second homes. Yet in a series of speeches, I have attempted to show 
that this rhetoric of class warfare might work politically, but as a 
description of tax reality it is lacking. The fact is, the largest tax 
expenditures, those that the President and Democrats would have to look 
to in order to raise revenue for deficit reduction, benefit middle 
class itemizers the most.
  Consider the example of the home mortgage interest deduction. Since 
adoption of the 16th amendment to the Constitution in 1913--98 years 
ago--the United States has had an individual income tax. And for that 
entire time home mortgage interest has been deductible in calculating 
taxable income.
  Most of our fellow Americans, when buying a home, do not pay cash for 
the entire purchase price. Rather, they typically pay a certain 
percentage in cash and borrow the rest. It is common that the money 
borrowed is repaid in monthly increments over the course of 15 or 30 
years. Those payments from the homeowner to the lender to compensate 
for the borrowing of money are interest payments. If you itemize your 
deductions, you get to subtract home mortgage interest from adjusted 
gross income--or AGI--in arriving at taxable income.
  The most significant of the itemized deductions available to 
taxpayers is the home mortgage interest deduction. The mortgage 
interest deduction is the second largest tax expenditure identified by 
the Joint Committee on Taxation, and it is not primarily a benefit for 
the wealthy. Thirty percent of the benefit of the mortgage interest tax 
expenditure goes to taxpayers over $200,000. Taxpayers with income 
below $200,000 receive 70 percent of the benefit of the mortgage 
interest deduction. By a ratio of almost 2 to 1, taxpayers under 
$200,000 benefit from the mortgage interest deduction. Since $200,000 
basically fits the definition of rich used by my friends on the other 
side of the aisle, we can see that the nonrich or middle income group 
disproportionately benefit from the mortgage interest deduction.
  There have been proposals over the decades to eliminate the home 
mortgage interest deduction, but none of them have succeeded. In 1986, 
during the last major tax reform effort, there were active proposals to 
get rid of the home mortgage interest deduction.
  President Clinton attacked some of the tax benefits associated with 
home ownership back in the 1990s. Specifically, President Clinton 
proposed taxing the imputed income associated with home ownership. A 
homeowner by living in his home enjoys a certain benefit--the ability 
to live in his home. That is, he could have rented the home out for a 
certain amount of money, but he instead decided to live in the home. It 
is as if he received the rental money for the home, and then spent it 
on rent so that the owner himself could live in the home.
  As policy this is somewhat convoluted. Generally, Congress has been 
reluctant to tax people when they have

[[Page S5207]]

received no cash. In addition, those on a fixed income would have found 
it difficult in many cases to get the cash to pay the tax. Finally, 
there would be significant administrative concerns--just what would the 
rental value of a home be? How would that be determined? It would be 
quite difficult. Thus, in a bipartisan fashion, Congress rejected the 
President's proposal to tax imputed income arising from owner-occupied 
housing.
  Now President Obama is taking another crack at it because he wants to 
raise money to reduce the deficit. President Obama has proposed, 
reproposed, reproposed again, and reproposed yet again to reduce the 
benefit of the home mortgage interest deduction. I am speaking of 
President Obama's proposed 28 percent limitation on itemized 
deductions. President Obama has proposed to limit the tax rate at which 
high-income taxpayers can take itemized deductions to 28 percent. This 
is meant to lessen the benefit to higher income taxpayers of itemized 
deductions--the home mortgage interest deduction being the most 
significant of the itemized deductions. The Joint Committee on Taxation 
says that this provision would mean the Federal Government would 
collect an additional $293 billion in taxes over 10 years.
  To understand this provision, allow me to tell you about two 
taxpayers: William and Spencer. Let's assume that William is in the 15 
percent tax bracket, and that Spencer is in the 35 percent tax bracket. 
Under current law, an additional itemized deduction of $100 is worth 
$15 to William, and $35 to Spencer. That is, an additional itemized 
deduction of $100 will reduce William's tax bill by $15, but Spencer's 
tax bill would go down by $35. If the President's 28 percent limitation 
proposal were to go forward, however, although the itemized deduction 
would still be worth $15 to William, it would now be worth only $28 to 
Spencer.
  Of course, one may think--well why should high-income Spencer get a 
more valuable tax benefit from an itemized deduction than low-income 
William? But that mischaracterizes things. First of all, high-income 
Spencer, even under current law, still pays significantly more tax than 
low-income William. That is not only true in absolute dollar terms, but 
also in terms as a percentage of their respective incomes. Furthermore, 
the 35 percent bracket was set by Congress with an understanding and 
realization that itemized deductions would allow a significant tax 
benefit. That is, had Congress known that higher income taxpayers would 
be disallowed some of their itemized deductions, as the President now 
proposes, undoubtedly Congress would have created a lower maximum tax 
rate bracket than the current 35 percent tax bracket. So, to take away 
some of the benefit of itemized deductions to higher-income taxpayers 
but leave the high-income tax rates at their current high levels is to 
upset the balance struck by prior Congresses. Obviously, Congress is 
allowed to do that. But let's not pretend that current law is somehow 
an oversight, or unintended consequence, from prior legislation.
  Some of the President's advisers defend the proposed 28 percent 
limitation on the grounds that 28 percent was the tax benefit one would 
get during the later Reagan years. Yes, that is true. But it is only 
true because 28 percent was the highest tax bracket after the Reagan 
tax reform!
  The larger point is this, however. To the extent that the home 
mortgage interest deduction, or any tax expenditure for that matter, 
should be addressed by Congress, it should be addressed through the 
context of a comprehensive, revenue neutral tax reform that lowers 
rates. These tax-expenditures should not be cherrypicked by the 
President and his liberal allies to pay for the checks that his 
administration has written.
  I have made this point many times, but today, it is important to make 
it again. To the extent that any tax expenditures are taken away, tax 
rates should come down, so that the net effect to government revenues 
on a static-score basis is neutral. That's what tax reform is all 
about-- getting rid of tax expenditures so as to reduce tax rates. By 
reducing tax rates, we will unleash the free-market. By unleashing the 
free market, we will grow the economy. By growing the economy, tax 
receipts will increase, even though on a static-scoring basis, tax 
reform would be revenue neutral. If we get rid of tax expenditures 
without an offsetting tax-rate reduction, then we have simply made the 
task of tax reform that much harder. We have squandered an important 
opportunity.
  I would like to make a last procedural point about where we go from 
here. Even if Congress passes, and the President signs, this deficit 
reduction package, we are going to be back at this again before the 
year is out. The President will be asking Congress to raise the debt 
ceiling again. Given that, I would like once again to address the 
failure by the Treasury Department to respond to repeated requests I 
have made over the past week about Treasury's short-term cash position, 
and the failure by almost every member of the so-called Financial 
Stability Oversight Council--or, F-SOCK--to provide Congress with 
information about their contingency plans in the event there is a 
ratings downgrade on U.S. debt in the future.
  Does Treasury still think it will run out of cash by midnight 
tonight? I have been given only limited information. Treasury continues 
to say we will run out of cash today and will not be able to pay our 
bills, the same date they estimated way back in May. But, Treasury 
won't show me how they are arriving at that estimate. I have not been 
informed, Congress has not been informed, and Americans counting on 
timely Social Security payments have not been informed. Almost every 
member of the F-SOCK, including Treasury and the Federal Reserve, has 
refused to provide me with any information about their contingency 
plans for ratings downgrades. Even if the debt limit is raised, there 
is no assurance that we won't face a downgrade. We need to know the 
government's plans.
  As I have said repeatedly, this is unacceptable. I want to be clear 
about two things. First, Congress will have to look into this matter 
very carefully, and investigate whether Treasury and most of our major 
financial regulators have been deliberately withholding information 
from Congress, and if so for what purposes.
  Second, assuming that down the road Treasury will present Congress 
with another default date, I want to put them on notice that this fall 
I will be demanding timely substantiation of Treasury's assessment and 
the government's cash position. Absent this cooperation, I will stand 
in the way of any debt limit increase demanded by an unsubstantiated 
Treasury-determined deadline.
  In closing I want to be clear. I cannot support the outcome of these 
negotiations. But my opposition is not owing to the failure of 
conservatives or the Republican leadership in the House and Senate. It 
is owing to what is clearly amounting to the failed presidency of 
President Obama. He and his allies are ideologically committed to more 
spending. Fortunately, the American people will have the final verdict 
on this economic philosophy in 2012.
  The PRESIDING OFFICER (Mr. Bingaman). The Senator from Oregon.
  Mr. MERKLEY. Mr. President, I rise to address the Obama-Boehner debt 
deal. I must say it is an issue on which I have been immersed in 
wrestling to understand the impact on unemployment, the impact on 
investments that will strengthen our Nation down the road; certainly an 
impact on programs that strengthen our families. It is in that context 
we try to understand how do we build the strongest possible Nation for 
working families. How do we do that? Is the Obama-Boehner debt deal the 
right path? I must conclude that it is not the right path. I conclude 
that for four reasons.
  The first is the impact on jobs. We are facing a gathering storm on 
the job front. We have 5 to 8 million additional foreclosures that are 
suppressing the success of our construction market, driving down the 
value of houses and having a devastating impact on the attempts at a 
recovery.
  Second, the unemployment benefits. The extended unemployment benefits 
expire this year, and the rough estimate is that that will result in a 
reduction of around 500,000 jobs. That is a tremendous blow in 2012. 
Then we have the termination of a payroll tax holiday and the estimate 
is that may well produce losses of jobs of more than 900,000 across 
America. Add them and you are talking about nearly 1.5 million lost 
jobs that we will face in 2012.

[[Page S5208]]

So on top of this gathering storm comes the Obama-Boehner debt deal 
that is estimated to produce another job loss--and by varying 
estimates--from 100,000 to 300,000. Doesn't this deal take us in the 
wrong direction? Shouldn't we be on this floor working to create jobs, 
not to destroy jobs? The success of our families depends on it.
  My second major reservation about the Obama-Boehner debt deal is its 
impact on working families through the concentration of cuts on the 18 
percent of the budget that is the nondefense discretionary portion. 
This is the portion of the budget that involves Head Start and Pell 
grants--in other words, an opportunity for our children, our smallest 
children, success for university education for our college-bound 
students. It is the area of the budget that involves investments in 
clean energy. It involves our small business programs that support the 
success of our small businesses. It involves job training that helps 
families adjust to a changing dynamic in the economy, and so much more.
  In this 18 percent of the budget is where the cuts will hit. What 
with the phase I required cuts, or title 1 cuts, in combination with 
the cuts under title 3, you have essentially 15 percent cuts from the 
2011 March CBO baseline. Understand that baseline for 2011 is a very 
low baseline, much lower than 2010, much lower than 2009. It takes us 
back many years earlier. We have a very low baseline and we are going 
to cut 15 percent more out of the core programs supporting the success 
of our working families, supporting the success of our smallest 
children, supporting the success of our college-bound children. This is 
not the path that builds a stronger America.
  The third factor is that while our children in Head Start and our 
children headed for college and our citizens seeking job training are 
going to take these blows, the wealthy and well-connected do not 
contribute one slim dime. As some of my colleagues have argued: Well, 
you know what, there are some of those programs embedded in the Tax 
Code that actually help the middle class. My colleague from Utah was 
just making that argument. Then the argument is extended: So don't 
touch any of those programs. Well, if we take that same attitude toward 
our spending programs, we would say some benefit the middle class, so 
don't touch any spending programs. Obviously, it is an absurd argument. 
Why is it made on the revenue side, to those programs there, but not in 
the programs that are on the appropriations bill? Why is the tax bill 
protected from not only that argument but the spending bills are not? 
One simple answer: The programs for the wealthy and well-connected are 
in the tax bill. So this false argument is used to defend the 
accumulation of wealth, the expansion of prosperity for the few--for 
the powerful few--at the expense of families across this Nation.
  My fourth concern about the Obama-Boehner debt deal is that simply it 
was forged out of a process of extortion. If you look through the 
editorials, you see words such as ``hostage taking'' and ``extortion'' 
and ``lunacy.'' We only have to turn back to Ronald Reagan to remember 
what he had to say on this. He said: This brinksmanship threatens the 
holders of government bonds and those who rely on Social Security and 
veterans' benefits. Interest markets would skyrocket, instability would 
occur in the financial markets, and the Federal deficit would soar. The 
United States has a special responsibility to itself and to the world 
to meet its obligations.
  Those who have threatened, for the first time in U.S. history, for 
the United States not to meet its obligations, which would result in a 
devastating impact for families across this Nation, those who carried 
out that threat did so in the wrong spirit--not the spirit of America 
pulling together, but in the spirit of creating a situation of hostage 
taking and extortion designed to protect the most powerful and wealthy 
at the expense of families across this Nation.
  Because this deal does damage to jobs and contributes to a gathering 
storm in 2012 that threatens to take us back to a double-dip recession, 
because the cuts are concentrated on the programs such as education and 
Head Start and Pell grants that support the success of our children and 
the success for our future economy, because it doesn't take one slim 
dime of contribution from those who are most able to contribute in our 
society, and because it was forged out of a fundamentally inappropriate 
use of extortion against the American family--for those four reasons I 
will oppose this deal.
  Thank you, Mr. President.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Missouri is recognized.
  Mr. BLUNT. Mr. President, I rise in support of the bill. I would say 
for the second time in about a week I have come to the floor to speak 
after one of my friends on the other side who is talking about what we 
ought to be talking about, and both times they were right. They said we 
should be talking about private sector job creation. I say where are 
the bills to do that?
  We have been here the week of the Fourth of July. We were here and we 
had two votes that week. One was to compel the Senators who didn't show 
up to show up. The other one was on some motion to proceed to cloture 
on something that had nothing to do with job creation or any of the 
other issues we should be talking about. We could talk about what we 
ought to be talking about, and that would be one thing. Of course, what 
we are talking about today is the moment we have arrived at, the date 
that was set by the administration. Apparently they were right in 
speculating when we need to look at the borrowing limit again, and that 
is today.
  I rise in support of the bill. I said for months the only thing worse 
than not raising the debt limit would be raising the debt limit and not 
changing behavior. In fact, I think that is what all the rating 
agencies that everybody is talking about now, whether they are going to 
and how they are going to rate our bond rating in the future--they have 
all said--and they said long before they talked about the debt limit--
that we are spending more money than we can afford to spend as a 
Federal Government or as a society. We are spending $1 out of $4 that 
the society can produce, and that is about 25 percent more than we 
spent in 2008. It is 25 percent more than we spent on the average from 
the 40 years from 2008 going backward four decades, and that is 
important. I think this bill does begin the process of changing 
behavior. The way we approached the debt limit this time was everything 
but business as usual.
  This is a totally different discussion than we have had before about 
the debt limit, and the country has almost always had debt. I think 
there have been only a couple of times in our history where Andrew 
Jackson paid off the debt and there was one other time we paid off the 
debt--only a couple of times in our history when we didn't have some 
kind of debt. In the tradition of that debt, we have always said: Okay, 
let's borrow more money because we need more money. This time, for the 
first time, we said: Why do we need more money? Why is it that we are 
increasing debt? Why is it we are increasing debt so rapidly? We had a 
$10 trillion debt in January of 2009, and 30 months later we have a $15 
trillion debt. Obviously that trajectory cannot continue and the 
framework for the decision that is made in this bill says it won't 
continue.
  Do we continue to add debt over the next decade? We wouldn't have to. 
There is a study out that says every time the debt ceiling comes up 
over the next 10 years, we make the same kind of determination that for 
every dollar we increase the debt ceiling, we are going to find a 
dollar in savings over the next decade. That study would indicate that 
in 10 years we balance the budget. Of course, that is what we should be 
doing, balancing the budget. This body, before I served here, before I 
served in the House, before I was in the Congress at all, in 1995 came 
within one vote of the balanced budget amendment, one vote of passing 
the amendment that had passed the House. In 1996 it came within two 
votes of passing that same amendment that had passed the House again. 
If that one vote would have changed in 1995 or the two votes would have 
changed in 1996, we would not be having this discussion today because 
we would have a balanced budget today and would be moving in the way 
that every State but one has to function and every family in America 
eventually has to come to grips with the fact that they cannot spend 
more than they have.

[[Page S5209]]

  The truth is, this agreement, while it is a 10-year agreement, is 
only enforceable for a couple of years. I believe we will do what this 
agreement says this year and next year. I am hopeful and optimistic the 
select committee will do its job and come back with another $1\1/2\ 
trillion or more of cuts to spending, and that is going to happen--that 
select committee is going to report this year. The budget cap is set 
for this year and next year.
  But elections matter, and who is elected in 2012 to the House and the 
Senate and the Presidency will finally and ultimately make a decision 
about whether this track we are on now gets better than it is now or, 
frankly, heads back in the other direction. I think the campaign 
pledges are important. While I support the bill, I am also fully 
appreciative of everyone who feels as though they can't.
  Frankly, if some campaign pledges hadn't been made in 2010, we 
probably wouldn't be at this moment. And if that is somehow 
extraordinary--that people run for office and say that is what they are 
going to do and then they come here and do that--that is what the 
process is all about and how it is supposed to work.
  Is this my sense of what would have been the best way to deal with 
these spending cuts? We would have more spending cuts if I were writing 
this bill. But the fact is, in Washington today no one party controls 
anything. My party, the Republican Party, controls one-third of what it 
takes to get a bill to become law, and the other party controls two-
thirds. At the end of the day, by definition, nobody is going to be 
totally happy with this bill.
  But as Senator Pat Roberts said yesterday in a meeting I was in, 
using an old legislative saying: This is not the best possible bill, 
but it is the best bill possible. It is the best we can do right now.
  I think we take this victory and use it as a way to move forward to 
the future.
  Mr. President, I rise, again, in support of this bill.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. LIEBERMAN. I thank the Chair.
  Mr. President, I come to the floor to express my support for the 
measure before us, as my colleague from Missouri who has just spoken, 
and as everyone else I have heard express their support for this 
proposal. No one seems perfectly satisfied with it, but that is 
inevitable. I think we have come to one of those classic moments of a 
very big challenge our Nation faces--this enormous debt--and whether in 
this agreement we see this glass half full or the glass half empty and 
whether what encourages us in the agreement outweighs what disappoints 
us.
  For me, the positive outweighs the negative. I am going to vote for 
my hopes about what this agreement means as opposed to my fears that we 
are not doing enough in this agreement.
  What makes me most happy about it is this is a bipartisan compromise 
that turns the corner, turns the ship of America's state away from 
greater and greater deficits and a greater national debt and in the 
direction of balancing our budget once more. It turns us in the 
direction of reestablishing classic American values of discipline and 
thrift and concern about our future and investment in our future, which 
we have lost in our Federal Government through the work of both parties 
in the executive and legislative branches of our government.
  It is a bipartisan agreement at a time when this Chamber and this 
city have become reflexively and destructively partisan, and that is 
encouraging to me, that it is bipartisan. It is a compromise at a time 
when this city has become ideologically rigid, and it is clear, if we 
look at our history, that we only make progress when we compromise. 
That is because we are such a big, diverse country with so many 
different opinions and points of view. So this is a bipartisan 
compromise. It is the beginning of a long, hard march back to fiscal 
responsibility in our country--back to a balanced budget.
  So what troubles me about it? What troubles me about it is that the 
bipartisan compromise also represents a kind of bipartisan agreement by 
each party to yield to the other party's most politically and 
ideologically sensitive priority. In the case of Democrats, it is to 
protect entitlement spending, and in the case of Republicans it is to 
not raise taxes. The reality is that we have to do some of both if we 
are going to get our country back into balance.
  Because this agreement doesn't really touch the entitlement 
programs--particularly Medicare, which is growing faster, bigger than 
any other government program--it puts all the burden of getting back 
toward balance in our budget on the so-called discretionary spending 
part of the budget. That is about one-third of Federal spending. About 
60 percent is the entitlement or mandatory programs. So we have the 
beginning of a system that forces cuts in the discretionary third of 
the budget--defense and nondefense--which they have to do, they have to 
cut--but it doesn't ask much of anything of the 60 percent that is 
growing so rapidly, which is entitlement spending.
  As a result, if the special committee created in this agreement--
which is the great hope of the agreement, I think--doesn't work its 
will and involve itself in entitlement reform and tax reform, and 
Congress doesn't accept it, then the trigger, the automatic spending 
cuts are also all from discretionary spending, asking that one-third of 
the budget to pay the way, even though it is a small part of the 
responsibility for the increase in government spending. That would have 
a devastating effect on our national security because it would 
dramatically undercut our defense, as well as some of the programs that 
are the great investment programs of our future: education, energy, et 
cetera, et cetera. So I hope the special committee will redeem our 
hopes and Congress will too by dealing with entitlement reform.
  I wish to say here that Senator Tom Coburn of Oklahoma and I, in 
June, introduced a proposal that would take steps to save Medicare for 
the almost 70 million people who will be on Medicare in a decade and 
reduce the enormous costs it places on our taxpayers. I think a lot of 
people in our country think the payroll deductions and the premiums 
they pay, pay the total benefits of Medicare. Unfortunately, that is 
not so. The average Medicare beneficiary in their lifetime takes $3 or 
$4 out of the system for every $1 they put in, and we just can't run a 
program long term like that. Who picks up the rest? The taxpayers, the 
budget. That is a big part of why we are heading into deficit. So we 
can't save Medicare by leaving it as it is. We can only save Medicare--
and I want to save Medicare because I believe in the program--if we 
change it.
  Senator Coburn and I put forward this plan that will save over $600 
billion in Medicare costs over the next decade. It will extend the 
solvency of Medicare by at least 30 years and reduce Medicare's 75-year 
unfunded liabilities by $10 trillion.
  Now, I know our plan contains some strong medicine, but that is what 
it will take to keep Medicare alive, and we believe our plan 
administers this medicine in a fair way. Senator Coburn and I are going 
to forward our proposal, which is in legislative form, to the joint 
select committee for their consideration, and we hope they will include 
parts of it in their recommended legislation.
  I also believe it is essential for the joint committee to act to 
bolster the solvency of Social Security. Many think Social Security is 
not contributing to the deficit because it has a positive balance in 
the Social Security trust fund. But what is in that trust fund? It is 
notes that the United States Government has given to the Social 
Security trust fund every time we have borrowed from it. Of course, we 
are bound to pay that money back.
  The fact is, today Social Security is running a deficit on a cashflow 
basis. In other words, the payments into the system are not as great as 
the payments out, and they will continue to do that in increasing 
numbers for the foreseeable future.
  What does that mean? It means the Social Security trust fund has to 
come to the Federal Government to redeem the bonds the government gave 
Social Security when it borrowed the money. How does our government pay 
back the Social Security trust fund? By borrowing over the next two 
decades $2.6 trillion, currently held in IOUs, plus interest. If we 
don't do something to save Social Security, when we hit the year of 
2036, Social Security will only

[[Page S5210]]

be able to pay benefits to the extent that they are covered by incoming 
receipts, and that will mean a sudden, shocking, painful 23-percent cut 
in benefits for senior citizens.
  We have to begin to enact reforms now to slowly save Social Security, 
and we can do it. I wish to indicate today to my colleagues that 
Senator Coburn and I are working again on a bipartisan proposal to 
secure Social Security for America's seniors for the long term, and we 
hope to have that done in time to also forward to the special committee 
for their consideration.
  So the bottom line: We can't protect these entitlements as well as 
have the national defense we need to protect us in a dangerous world 
while we are at war against Islamic extremists who attacked us on 9/11, 
and will be for a long time to come. We can't not touch the 
entitlements or raise taxes and create a tax reform proposal and expect 
to protect all the programs of investment in our future that mean so 
much to America's families: education particularly, alternative energy, 
investments in our transportation system.
  To be able to do all that in the right way, we need this special 
committee and Congress to take the next steps. But this is a 
significant beginning, as imperfect as it is.
  If I may, finally, for all of us--and particularly for the President, 
the Speaker, the majority leader, the Republican leader in the House, 
and the Democratic leader in the Senate, and everybody who worked so 
hard, coming close to the kind of grand bargain I think we needed, that 
the Simpson-Bowles Commission adopted, that the Gang of 6, our 6 
colleagues, recommended to us, which I support, and that the President 
and the Speaker, President Obama and Speaker Boehner, were close to but 
unfortunately fell apart--there is disappointment that a lot of us 
feel. But perhaps to put it in a broader context, I wish to quote from 
an op-ed piece in the Wall Street Journal today written by David Rivkin 
and Lee Casey, who are two lawyers whose work I have long admired. Here 
is what they say to take us back and perhaps remind us that we fill 
these seats for a short period of time. We act within the system 
created by our Framers, and we do our best. They wrote:

       The debt-ceiling crisis has prompted predictable media 
     laments about how partisan and dysfunctional our political 
     system has become. But if the process leading to the current 
     deal was a ``spectacle'' and a ``three-ring circus,''

  As someone put it--

     the show's impresarios are none other than James Madison and 
     Alexander Hamilton. Our messy political system is working 
     exactly the way our Founders intended it to.

  Then I go toward the end of their op-ed piece:

       The key point has been made--

  Excuse me. Let me start a paragraph ahead:

       Rarely in our system do the participants--

  Whether in the White House, Senate, or House--

     achieve all or even most of their goals in a single political 
     battle. . . . The key point has been made. Few now suggest 
     that we can continue on our current spending binge. That is 
     the beginning of a consensus, and a good start towards 
     genuine change.
       The Framers would be pleased at the spectacle.

  I thank the Chair, and I yield the floor.
  Mr. LEAHY. Mr. President, this is not a solution I would have 
preferred, but the compromise finally reached by the White House and 
congressional leaders has the potential to end this manufactured 
crisis. It is a solution that puts common sense and the national 
interest above partisanship and ideology.
  The country has been pushed to the brink of catastrophe. The choice 
at hand is not this bill or something better. The choice is between the 
only bipartisan practical solution to the debt ceiling crisis, or a 
devastating default on the Nation's debts for the first time in our 
history. A default would send shock waves throughout our fragile 
economy. It would slap a credit rate tax on every household and every 
business in Vermont and across the country.
  The solution before us includes $3 trillion in spending reductions 
reached through bipartisan negotiations that will yield the greatest 
overall budget savings ever. Just as Vermont families are having to 
make difficult financial decisions, we need to make long-term budget 
reforms, and the country should be spared the ordeal of having to go 
through this same kind of torment again just a few months from now.
  The special congressional committee chartered by this legislation to 
recommend future deficit reduction can consider revenue measures, and I 
will continue to push for an end to outdated tax loopholes for giant 
oil firms and companies that ship American jobs overseas. I also 
continue to believe that the wealthiest Americans should pay their fair 
share in these solutions.
  If the special congressional committee fails to make bipartisan 
recommendations, then the agreement calls for cuts in defense spending 
and protections for Social Security, Medicare benefits, Medicaid, 
veterans benefits and child nutrition. I strongly support these 
protections.
  All along the American people have wanted this debt-limit crisis 
resolved promptly and fairly through the give-and-take of our 
representative government. It is extremely unfortunate that many who 
manufactured this crisis in the first place then stood in the way of a 
solution for weeks on end, threatening the first default on United 
States obligations in our history.
  Many in this body recall, as I do, the period just two short decades 
ago when Congress and a Democratic President were able to balance the 
Federal budget and create budget surpluses that were on their way to 
paying off the national debt altogether. I remember also the key Senate 
vote to put us on that path, which had to be achieved without any 
support from the other side of the aisle. Those balanced budgets and 
surpluses also were achieved without any constitutional amendment 
requiring them. And those surpluses grew, until subsequent decisions 
were made by a new administration, and ratified by a new Congress, that 
squandered the surpluses and piled the debt up once again.
  What the American people want, need, and deserve right now is a 
return to wise and disciplined leadership. We need the return of a 
willingness to cooperate and to forge solutions across partisan lines 
to solve the most pressing issues facing the country. The economic 
health of the Nation and the jobs of thousands of hardworking Americans 
should not be mired in politics.
  The Senate throughout history has shown its remarkable ability to 
rise up in times of crisis to reflect the conscience of the Nation. Now 
is such a time, for the good of the country, for Democrats and 
Republicans in both chambers to rise to the occasion and put an end to 
this contrived crisis that has put our entire economy at risk.
  The PRESIDING OFFICER. The Senator from Georgia is recognized.
  Mr. ISAKSON. Mr. President, I commend the Senator from Connecticut on 
his remarks and, particularly, his closing. I associate myself with 
what he said. I will support this bill when it comes to the floor at 12 
o'clock today.
  On Saturday, I came to the floor at 2 o'clock out of frustration and 
made a speech critical of the negotiators as we were letting the clock 
run and had no deal. I was critical because we had pretty much had an 
agreement we were going to cut. We pretty much had an agreement we were 
going to establish a select committee to do the cutting. But we had not 
agreed to a balanced budget amendment. We had not agreed to an 
enforcement mechanism on the committee to make sure they did the 
cutting. Probably most importantly of all, we had not agreed to 
triggers on the debt ceiling increase for accountability.
  I come to the floor today not frustrated but feeling somewhat 
rewarded because on the three solutions negotiated to those three 
component parts of this particular piece of legislation, the genie is 
out of the bottle, and history is about to be made.
  No. 1, on the debt ceiling increase, when the trigger was finally 
established, it means from now on whenever this debt ceiling increase 
is asked for by a Republican or Democratic President, it will be 
demanded that there be spending cuts commensurate with any increase. 
That is historic. That is the first step in the right direction of 
sanity, accountability, and fiscal responsibility.
  Secondly, they finally came together and agreed there would be a 
balanced

[[Page S5211]]

budget amendment vote in the House and the Senate before this year end, 
with incentives for us to vote for that balanced budget amendment. For 
the first time since 1995--the first time in 16 years--the Congress of 
the United States will be debating, forcing itself to do what every 
American family has to do. There is not a family within the sound of my 
voice who has not had to sit down in the last 3 years in this country--
because of our recession and our economy and because of spending--and 
reprioritize how they spend their money to balance their budget, to 
live within their means. It is about time the Congress of the United 
States asked of itself what it imposes on every family in America.
  As far as the select committee, there was a fear among many that it 
would only be a paper tiger; that it would not have the claws or the 
teeth to actually do what it needs to do on the cuts. While I would 
have done a different type of sequestration, I commend those who 
negotiated this sequestration on putting one in that has enough teeth 
and enough fear to force this select committee to do what it needs to 
do.
  Today, when I vote in favor of this agreement, I will be voting for 
us to cut spending where we need to--not as much as I would have liked 
but a lot more than we have ever seen before--but, most importantly, 
voting for the assurance that never again will a debt ceiling go up 
without a debate for commensurate cuts in spending. That is important. 
I will be voting for this because we will have a balanced budget 
amendment on the floor of the Senate and on the floor of the House of 
Representatives that we have long needed since the last one failed 16 
years ago. And we finally have a sequestration mechanism or an 
enforcement mechanism to enforce the select committee to do what it is 
charged to do in this particular legislation.
  My frustration I expressed on Saturday is gone. My pride in the 
Senate is restored, and I look forward to casting my vote in favor of 
this agreement at 12 o'clock today.
  I yield back.
  The PRESIDING OFFICER. The Senator from Kansas is recognized.
  Mr. MORAN. Mr. President, thank you for recognizing me.
  I am honored to be, once again, on the Senate floor. I have spoken 
many times about the issue that is now before us for a vote in just a 
few minutes.
  This is a significant point in our country's financial history--a 
time in which politics has played its course and decisions have to be 
made. I come here at this moment with no real joy. I think we have put 
the American people through a lot--certainly, over the last several 
months--as we asked them to follow along as we discussed this idea of 
raising the debt ceiling.
  There was some thought by many of us that we could use this moment of 
raising the debt ceiling to make some significant changes in the way we 
do business in Washington, DC. In fact, on March 22 of this year, I 
wrote President Obama a letter indicating I could not vote to raise the 
debt ceiling unless I saw substantial reductions in spending and 
structural changes in the way we do business in the Congress and 
Washington, DC.
  Why I say there is no joy for me to be here today, in my view, we 
have failed to do either one. There are no substantial reductions in 
spending, and there are no significant changes in the way Washington, 
DC, does business.
  This country needs certainty, and I have said all along we need to 
raise the debt ceiling. There needs to be that certainty. I have said 
it would be irresponsible for us not to raise the debt ceiling, but I 
have said all along it would be equally as irresponsible if we raised 
the debt ceiling without meeting the criteria I have outlined.
  While we will have a discussion among all of us that continues 
today--and we will probably play quarterback and Friday morning 
quarterback after this is over to figure out what we have 
accomplished--but, in my view, it is important to know there are no 
cuts in this bill. There is only a reduction in the growth of spending, 
and that reduction is so small--$21 billion reduced in the first year 
in the growth in spending.
  In Kansas, when we hear the word ``billion,'' we think that is a lot 
of money, and it is. So I think Kansans will hear the words ``$21 
billion'' and think: Oh, my, they are finally doing something 
significant. But the truth is, we spend $4 billion more each day than 
we take in, and that $21 billion, if realized, in the slowing of the 
growth of spending, will be gone in less than a week. This legislation 
does not cut spending.
  While we promote a balanced budget amendment, which I think is so 
critical to our success in changing the structure of how we do things, 
there is no balanced budget amendment to the U.S. Constitution in this 
agreement or one that will necessarily be sent to the States for 
ratification. Our national debt will continue to grow and, in fact, at 
the end of 10 years, if everything in this legislation is 
accomplished--and I think we have to be skeptical about that--our 
national debt will grow and reach $22 trillion. We are at $14.3 
trillion or $14.4 trillion now. Ten years from now, with this 
legislation in place, $22 trillion. Over the next three decades, our 
debt will become three times the size of our entire economy.
  We have talked about changing the way we look at things in 
Washington, DC. For the first time--and I agree with this--we are 
talking about reducing the growth of spending by the amount we are 
raising the debt ceiling. But can you imagine a family back in Kansas 
congratulating themselves for changing the topic without ever changing 
their spending patterns? Kansas families, when they are in trouble for 
spending too much money, cut the budget today. We are not doing that. 
They do not just slow the growth, and they do not wait for 10 years to 
see it realized.
  The problem is today, and I think this is a significant problem. 
People will say we need to raise the debt ceiling today or our credit 
worthiness will be judged by the rating agencies and we will be 
downgraded. I worry that even with the passage of this bill, its 
effects are so minimal in spending that the downgrade will occur 
regardless.
  So this is a time for us to make the tough choices as compared to 
kicking the can down the road one more time.
  It is an honor to serve in the Senate. Nothing in my life, my 
background, would ever suggest I would have this opportunity. I am 
honored to serve Kansans, and I will do my best to make the right 
decisions on their behalf. But as I have listened to Kansans for the 
last 2 years on the topic of what is important to them, the economy 
matters, and the first thing we have to do is get our fiscal house in 
order so the economy can grow and people can find jobs and get better 
jobs.
  While my assumption, based upon the news reports, is the legislation 
I oppose will pass today, I pledge myself to my Kansas constituents 
that I will work hard to see that every dime that is possible to be 
saved occurs, and I will redouble my efforts to see we grow the economy 
and put Americans back to work because the revenues we need to balance 
our books are not increases in taxes.
  The revenue we need to balance our books is a strong and growing 
economy so every American can put food on their family's table, save 
for their children's education, and prepare for their own retirement, 
and that we are blessed with the opportunity in this country to see 
every American child be able to pursue the American dream.
  I thank the Presiding Officer.
  The PRESIDING OFFICER. The Senator from New Hampshire is recognized.
  Ms. AYOTTE. Mr. President, for weeks, Americans have watched the 
debate about raising our Nation's debt ceiling. I know it is has been 
difficult and often frustrating to watch what is happening, but the 
discussion could not have been more important for the future of 
America. We have been talking, again, about whether we would increase 
America's borrowing limit.
  In doing so, we have rightly focused on how to prevent a default on 
America's credit, but also, just as important, rather than just 
reflexively continuing to borrow money we do not have from Chinese 
bankers, how we are going to confront the fundamental behavior in 
Congress that has led us to this culture of borrowing and overspending.
  I have said from the beginning of this debate that we owe it to the 
American people, and I owe it to my constituents in New Hampshire, to 
confront both issues--to avoid default and, finally, to

[[Page S5212]]

confront our debt once and for all, and to change the direction in 
which we are headed as a country.
  To address only default and to continue to kick the can down the road 
on making the tough decisions to fundamentally change the path we are 
on will surely lead to a downgrade of our credit rating. It will sap 
our economic strength and will lead to the insolvency of the greatest 
country on Earth.
  While I appreciate the difficult work done by the Speaker of the 
House and our Senate leadership in coming up with an agreement that 
avoids default, I am unable to support a bill that delivers the largest 
debt ceiling increase in the history of our Nation but does very little 
to confront the underlying problems that have brought us here--problems 
that have led us to over a $14 trillion debt and which will increase in 
the next 2 years to over $16 trillion in debt.
  I have not come to this decision lightly. I have had countless 
meetings over the last months and weeks with my colleagues on both 
sides of the aisle to talk about this issue and how we can confront 
this crisis now. I have said from the beginning we need fundamental 
changes in the way we do business in Washington, including budget 
reforms, enacting a responsible budget.
  I am a member of the Senate Budget Committee--the newest member of 
that committee--and it has been terribly disappointing to me that the 
Senate hasn't allowed the Budget Committee to do its work and come up 
with a budget for the United States of America.
  So we do need fundamental budget reforms. I have said we need major 
spending reductions, and we need to reform our entitlement programs. I 
cannot in good conscience agree to a deal that continues to perpetuate 
the culture of overspending and borrowing in Washington.
  In coming to this decision, I have asked myself several questions: 
The first question I have asked is, Does this agreement significantly 
reduce spending? Unfortunately, the answer is no. While it claims to 
reduce the deficit by $917 billion over the next 10 years, only in 
Washington would this be called a spending reduction. Because of 
baseline budgeting, a reduction of $917 billion in the deficit, as it 
is claimed, is no reduction at all. Over the next 10 years, under this 
agreement, we will spend over $830 billion more in discretionary 
spending.
  So there is no reduction in spending. If you just look at the 
reduction from what we will spend in fiscal year 2012, it is really 
only a $7 billion reduction in spending between what we will spend in 
2011 and 2012. We borrow $4 billion a day to sustain our government. So 
the spending reductions between what we spend in 2011 to 2012 is not 
even 2 days of borrowing for the United States of America.
  Many of the cuts are in the outyears. And you know what happens in 
Washington when the cuts are in the outyears. Unfortunately, our 
history has been that they do not get done. That is why I am concerned 
about even the $917 billion claim in reductions, which is not a 
reduction in spending.
  I have also asked myself, Does this agreement in any way reduce the 
size of government? We know this government has continued to grow even 
as State governments and families have made the tough decisions to 
downsize, to reduce, to live within their means. This deal does not cut 
or end one government program.
  In March, the GAO came out with a report that identified hundreds of 
duplicative programs that happen here in Washington where we could save 
billions of dollars. My colleague from Oklahoma, Dr. Tom Coburn, has 
done the hard work of identifying hundreds and hundreds of duplicative 
programs where we could save billions of dollars. Yet this agreement 
does not reduce the size of government at all or end one of those 
programs.
  Does it avoid a downgrading of our credit? Unfortunately, I think 
this agreement will also lead us to a downgrade. And why does that 
matter? Because it will hurt the economic strength of America and our 
economic growth, our borrowing costs. It will hurt our job creators 
when now more than ever we need to create jobs in this country and put 
people to work. Yet our failure to get our fiscal house in order here 
in Washington is hurting the hard-working people in New Hampshire and 
America.
  The credit rating agencies and even the President's own fiscal 
commission have said that the minimum amount of debt reduction that we 
need over the next decade is $4 trillion just to stabilize our debt and 
to ensure our AAA credit rating is not downgraded. But with this 
agreement, even if everything happens and this congressional committee 
does all of its work, we will only see a maximum reduction of $2.4 
trillion. And that is assuming everything in those outyears gets done, 
which we do not always have a good history of here in Washington.
  Finally, does it change the trajectory of where we are going with our 
debt to preserve our country? No. Under this agreement, we will 
continue to about $1 trillion a year to our debt--a debt that is 
already $14 trillion.
  It does nothing to strengthen our entitlement programs. We know from 
the trustees of Medicare that program is going bankrupt in 2024. We 
know from Social Security that program is going to be bankrupt in 2036. 
Yet we have not taken on that fundamental problem in this agreement. 
How do we reform those programs to preserve them for Americans that are 
relying on them and to sustain them for future beneficiaries?
  While I appreciate that we are beginning to change the discussion 
here in Washington, I cannot support this agreement. I appreciate that 
it is very important that we avoid default, but I know we are better 
than this. I know we can do more to make sure we preserve the greatest 
country on Earth. We need to take on the fundamental problems, the 
chronic overspending in Washington. We cannot continue to say that a 
reduction is a reduction when it is not, when we are continuing to 
spend more money, because at home people look at that and say: Give me 
a break. That is not how I do my family budget.
  We have to tell the truth to the American people and make the hard 
decisions. I know we can come together and get something done that will 
fundamentally change the direction in which we are headed. That is why 
I am disappointed about this agreement, because it does not do that.
  We must do more than avoid default. We must save our country for the 
sake of our children. I have often come to this floor and talked about 
the fact that I am the mother of two children.
  The PRESIDING OFFICER. The Senator has used 10 minutes.
  Ms. AYOTTE. Mr. President, I ask unanimous consent for 1 additional 
minute.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. AYOTTE. I am the mother of a 6-year-old and a 3-year-old. This 
discussion goes beyond those of us who are serving right here; it is 
about what kind of country are we going to leave for the next 
generation. And I know I will not look my children in the eye and have 
them say: Mom, what did you do about it?
  We have to solve this crisis now. I know we can. I look forward to 
working with my colleagues on behalf of the people of New Hampshire, to 
really rolling up our sleeves, finally cutting spending, and saving the 
greatest country on Earth.
  Mr. GRASSLEY. Mr. President, during the past few weeks and months, 
Congress and the President have been involved in discussions to raise 
the debt ceiling, and reduce spending, deficits and debt. This 
discussion is a result of the elections last year. The voters sent a 
strong message that it was time for Washington to stop the spending 
spree. And it is because of that message that we are even having this 
debate. Even the President now agrees that to address our fiscal 
situation we need to reduce spending.
  That has not always been the case, though. Just last year President 
Obama refused to endorse or advance the findings of his own National 
Commission on Fiscal Responsibility and Reform. On February 14, 
President Obama submitted his budget proposal to Congress that refused 
to address our looming deficits and debt. Over the next 10 years, his 
budget would have added another $13 trillion to our national debt. 
President Obama's budget was so out of touch that it was rejected in 
the Senate by a vote of 97-0. Then he delivered a speech in April that 
magically found $4 trillion in spending cuts.

[[Page S5213]]

In just a matter of weeks, President Obama found $4 trillion in 
spending that no longer needed to be spent.
  The American people have to wonder how Washington can be serious 
about budgets and spending if the President, in a matter of weeks, can 
find $4 trillion of spending that was of national importance on 
February 14, but is no longer necessary on April 13. It is this type of 
behavior that leads people to be cynical of Washington and the Federal 
Government. It is little wonder that lofty commitments from Washington 
are received in Middle America as just more empty promises and 
political rhetoric.
  Up until a few months ago, President Obama and members of his 
administration were calling for a clean debt limit increase with no 
spending cuts. He simply wanted Congress to provide him a blank check.
  The debate has shifted. We are no longer discussing spending 
increases. The entire debate today is about cutting spending, how much 
and from where. The fact that we are here today in agreement on the 
need to cut spending is an enormously important development. I commend 
all of those who worked and insisted that spending cuts be included in 
this agreement, and I thank those who were involved in working out this 
hard fought agreement.
  Unfortunately, this bill does too little to address our overspending, 
deficits and debt. Virtually none of these cuts in this bill come in 
the next few years. It is all back loaded with no guarantee that 
Congress won't reverse course, and undo these spending reductions. And, 
there is no guarantee that entitlement programs that are driving the 
long-term fiscal problems will be reformed. These programs need reform 
so they remain viable, affordable and available for generations to 
come. But this bill has too little to ensure those reforms take place.
  The American people sent us to Washington to confront these problems. 
They want us to stop overspending. They want us to chart a path to 
fiscal responsibility, where Washington spends only what we take in, 
like the American people themselves must do. And, while this bill is a 
small step in the right direction, I believe the American people expect 
and deserve a giant leap in the right direction.
  In addition to its timidity on spending reductions, I fear that this 
bill will set up a process to increase taxes on the American people in 
the belief that more tax revenue would lower deficits. This bill 
creates a bicameral, bipartisan committee that will be tasked with 
producing the second tranche of deficit savings. Despite the fact that 
our government has a spending problem and not a revenue problem, 
President Obama continues to insist that higher taxes must be a part of 
a major deficit reduction plan. It is his desire for bigger government, 
and higher levels of taxation that will likely prevent any serious 
follow-on deficit reduction or entitlement reform package.
  I want to be clear. I do not wish for the government to be launched 
toward a threat of default. My vote against this bill is not a signal 
that I would prefer default. I would not. But, I am compelled to vote 
against this package because I see this as a missed opportunity. We are 
providing President Obama with the largest increase in the national 
debt ceiling in history. But, instead of using this opportunity to 
address our near term and long term spending and fiscal problems, we 
are cutting a little now, and kicking the can further down the road.
  This bill grants a $2.4 trillion increase in our Nation's debt limit, 
the largest increase in our history. The challenge for Congress and 
President Obama was to sketch a deficit reduction plan to address 
deficits and debt in a significant way. The uncertainty about 
Washington's fiscal management gets in the way of private-sector job 
creation and economic recovery. But this bill is insufficient in 
putting us on a path to live within our means.
  To me, this is also a moral issue. It's wrong for this generation to 
over-spend and leave the bills for the next generation to pay. The 
trajectory of our debt is alarming. It will soon undermine our economy 
and our economic growth. If we do nothing, our children and 
grandchildren will have fewer economic opportunities than we have had. 
Without a plan to put our fiscal situation on a better path, the next 
generations will have a lower quality of life than the one we've 
experienced. We can't let that happen. But, I am afraid this bill will 
accomplish too little in this regard.
  Again, I recognize that this hard fought compromise is a step in the 
right direction, and I am pleased that Congress and the American people 
have recognized the terrible fiscal path our nation is on. I only wish 
that this plan was proportional to the size of the problems we face.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Kansas.
  Mr. MORAN. Mr. President, I ask unanimous consent that the time 
during any quorum call be equally divided.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. MORAN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. LEE. 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. LEE. Mr. President, I stand today to explain my reasons for 
voting against the debt limit increase we will be voting on in just 
about half an hour from now.
  This is a crisis that America faces. It is an ongoing crisis that 
will neither be created nor eliminated with today's vote. It is a 
crisis that has been building gradually over the course of years--
decades, in fact. It is a crisis that we certainly have known about 
ever since this Congress was sworn in in January of this year.
  This is a crisis that threatens potentially every Federal program, 
from defense to entitlements, because as we continue to borrow more 
money as a nation, adding to the already almost $15 trillion we have 
accumulated in national debt--roughly $50,000 for every man, woman, and 
child in America; roughly $150,000 for every taxpayer in America--as we 
continue to add to that enormous debt, we get closer and closer to the 
unknown but nonetheless existing point at which we will no longer be 
able to borrow, at least not at interest rates that will make this kind 
of borrowing sustainable.
  If interest rates were to go up even to their historically average 
levels, within just a few years we could be spending something closer 
to $1 trillion every single year. Just to pay the interest on our 
national debt, we could be paying more than we pay on Social Security 
in an entire year, more than Medicare and Medicaid combined, and more 
than national defense in an entire year. What happens when we get to 
that point? Where does that money come from? The reality is that every 
Federal program, from defense to entitlements, could see its coffers 
raided in an unfortunate Draconian display of fiscal irresponsibility 
if we continue to punt this problem and not to address it.
  The legislation at issue today addresses this problem by perpetuating 
it. I am pleased, of course, that this legislation does certain things 
and has invigorated a new conversation on the sorts of strategies that 
need to be in place if we are ever going to address this problem on a 
long-term basis.
  Some 7 or 8 months ago, there were still people in this town of 
Washington, DC, who were saying things along the lines of ``we need 
another stimulus package'' or ``we need more Federal spending of one 
sort or another.'' They are no longer saying that. Now the discussion 
focuses not on whether to cut but how much.
  There is, of course, renewed discussion about the need for a balanced 
budget amendment. But talk is different from outcomes. What we need are 
outcomes. What we need is a fundamental change to the way we spend 
money in Washington. What we need is to restrict Congress's authority, 
granted by clause 2 of article I, section 8, of the Constitution, to 
incur debt in the name of the United States. That power needs to be 
restricted. The only way we can restrict that on a permanent basis, one 
that will bind not only this Congress but future Congresses that come 
after us, is through an amendment to the Constitution.
  This legislation raises the debt limit by about $2.5 trillion. This 
is a recordbreaking sum. Not too many years ago,

[[Page S5214]]

when I was in high school, this was roughly equivalent to our entire 
national debt. Now, through one piece of legislation, we are 
increasing, expanding our already huge national debt by roughly that 
same sum, and it does not contain any permanent, binding structural 
spending reform mechanisms of the sort that would be necessary to make 
sure we get out of this problem, to make sure we end the problem we 
have created through Congress's reckless pattern of perpetual deficit 
spending.
  That is why I have insisted since before I was even sworn into office 
that before we raise the debt limit, we need to pass a balanced budget 
amendment and submit it to States for ratification. Nearly every State 
balances its budget each and every year. It is not news when a State 
does this. I look forward to the time when it will no longer be news 
when Congress does the same.
  There are significant cuts discussed in this legislation and 
proposed, but I want to be clear on one thing: Although these cuts are 
large on a long-term basis, on a short-term basis they are less so. On 
a short-term basis, within the next year, this proposes to cut about $7 
billion out of the fiscal year 2012 discretionary spending budget. Some 
dispute this number and suggest, as some of my colleague have already, 
that, in fact, the fiscal year 2012 budget will spend $23 billion more. 
Others concede the point and say: OK, let's assume for purposes of this 
discussion that it does, in fact, cut $7 billion from what otherwise 
would be new deficit spending. Now, $7 billion is roughly equivalent to 
the amount of debt we have added to our total debt portfolio just in 
the last 30 hours or so, roughly the period of time that has elapsed 
since this legislation was announced late Sunday night until this very 
moment, because we are borrowing about $4 billion of new debt every 
single day. Stated differently, this amounts to less than two-tenths of 
1 percent of a cut.
  I do believe we have made progress. I commend our leadership for 
working so hard to focus the discussion on the need for cuts.
  We have, unfortunately, had Democratic leadership in this body that 
has been bent on delaying the announcement of any deal as long as 
possible and preventing legislation such as the Cut, Cap, and Balance 
Act from coming to the floor, where it could have been subjected to an 
open debate, discussion, and amendment process, as well it should be. I 
regret the fact that it didn't come to that, the fact that that 
legislation, which could have solved this problem and would have put us 
on a path toward fiscal responsibility, toward ending this problem once 
and for all, was not even allowed its day in the Senate to be debated 
and discussed on the merits.
  At the end of the day, we have to come to terms with the fact that 
the course we are on, from a fiscal standpoint, is utterly 
unsustainable, and adding more debt to our now-bursting portfolio of 
debt will only contribute to this problem--unless we adopt a balanced 
budget amendment. The time to do that is right now.
  The American people overwhelmingly support a balanced budget 
amendment, to the tune of about 75 percent. To my great astonishment, 
some of my colleagues and even the President have suggested that a 
balanced budget amendment is somehow a radical idea--so radical as to 
be absurd and not worth considering--even though three out of four 
Americans believe we need a balanced budget amendment.
  I will close by referring to a quote by a man named William Morris, 
who said this in the late 1800s:

       One man with an idea in his head is in danger of being 
     considered a madman; two men with the same idea in common may 
     be foolish, but can hardly be mad; ten men sharing an idea 
     begin to act, a hundred draw attention as fanatics, a 
     thousand and society begins to tremble, a hundred thousand 
     and there is war abroad, and the cause has victories tangible 
     and real; and why only a hundred thousand? Why not a hundred 
     million and peace upon the earth? You and I who agree 
     together, it is we who have to answer that question.

  It is not just one or two of us who have this idea in our head that 
we need to restrict Congress's borrowing power because it has been so 
severely abused over such a prolonged period of time; it is three out 
of four Americans. I urge my colleagues in the Senate and our 
counterparts in the House of Representatives to join the American 
people in at least the same proportion in supporting the idea that 
never again should we raise the debt limit without a balanced budget 
amendment in place.
  This is a permanent, long-term problem. It requires a permanent 
solution. The only permanent solution is that which involves an 
amendment to the Constitution.
  Ms. MIKULSKI. Mr. President, through serious negotiation, leaders 
from both parties and the President have reached a bipartisan solution 
that will lift our debt ceiling and prevent a downgrade of our credit.
  Make no mistake, this agreement is stark and stern but necessary. It 
includes cuts that I would have never voted for under different 
circumstances. However, if we fail to take action, the economy will be 
irrevocably fractured.
  While it is far from perfect, the agreement meets my principles for 
avoiding default and downgrade. It provides a long-term extension of 
the debt ceiling, a significant downpayment on cuts, and a path forward 
to reform tax earmarks and entitlements.
  The consequences of a default and downgrade would be significant and 
severe and would alter the course of the United States for a century. 
Default would have led to sky-high interest rates that would have 
created a new tax on every single American. It means if you have a 
variable rate mortgage, it would skyrocket. If you have a student loan, 
the interest would increase. And if you have a car loan, the payments 
would be greater.
  Under default, the President would also have to prioritize what 
obligations to pay. First, we would have to pay our troops. Then we 
would have to meet our obligations to seniors and veterans. Federal 
funding for State and local governments would run out. This would 
affect infrastructure projects, funding for schools and teachers and 
firehouses and police stations. Contractors who work for the Federal 
Government would face layoffs without pay, and businesses would reduce 
hiring. The economy would be further weakened, and it would be a self-
inflicted wound. I could not allow this to happen.
  I took an oath to protect and defend the Constitution. The 14th 
amendment says that the validity of America's debt must not be 
questioned. While the lawyers made the interpretation complicated, the 
framers made it simple. America pays its debt with no exceptions. 
Failure to reach an agreement would be a violation of the American 
people and our creditors' trust. And it would have violated my oath to 
the Constitution.
  America must meet its obligations to its creditors. We must also meet 
our obligations to each other. Throughout this debate, I have insisted 
on no benefit cuts to soldiers, seniors, and veterans, and I will 
continue to do so. Obligations made must be obligations kept.
  I will also fight to fulfill our obligations to the next generation 
who will lead us through the 21st century. We can't cut our way to a 
new economy. We need to invest in it by rebuilding roads, bridges, and 
increasing access to broadband. This is what will lead to new jobs, new 
opportunity, and new prosperity.
  We also need to invest in education, science, research and 
technology. These investments will lead to jobs of the future and 
prepare students and workers to compete in a global economy. This means 
making sure kids have access to higher or career education. It means 
supporting scientists who are finding cures for the most devastating 
diseases. And it means giving businesses the tools they need to develop 
new products. We can't afford not to make these investments.
  After wrenching analysis, I will vote for this bipartisan agreement 
because it is an achievable and pragmatic solution to the crisis that 
would be caused by inaction. It will require tough action and strong 
medicine down the road, but it is necessary to honor our obligations to 
the greatest generation and the next generation.
  Mr. McCAIN. Mr. President, I support the legislation before us today 
to raise the debt ceiling and at the same time curb government spending 
without raising taxes. The United States cannot default on our 
obligations, and this

[[Page S5215]]

bill prevents that from happening. This deal is not perfect. It is not 
what I would have written, and I have grave concerns about the cuts to 
our Nation's defense spending that may have to occur as a result of 
this bill's passage.
  What this plan does represent is a fiscally sound path forward, and 
therefore I support its adoption. I applaud the courageous leadership 
of Senator McConnell and Speaker Boehner. They have guided Republican 
members on both sides of the Capitol with tremendous skill and 
integrity and fought hard to ensure that our party's core principles 
were not negotiated away. I am proud of them, and I thank them. And I 
would be remiss if I did not also express my gratitude to Majority 
Leader Reid. He has a very difficult job in this body, and he deserves 
a tremendous amount of credit for helping get us to this point. He 
fought hard for his caucus and their priorities, and I congratulate him 
on successfully negotiating a fair compromise on their behalf.
  While I will support this bill, I have a great deal of concern about 
the direction this compromise takes defense spending. I have said many 
times, defense spending since 9/11--which was preceded by nearly a 
decade of drastic reductions in military personnel, equipment, and 
readiness--is not the cause of the economic dilemma in which we find 
ourselves. Cutting defense so deeply that long-term, catastrophic 
damage to our national security interests would result will not solve 
our deficit spending and debt problem.
  Since this year began, the President has already asked the Defense 
Department to cut more than $178 billion by finding efficiencies and 
taking top-line reductions in proposed defense spending over the next 5 
years. But this compromise deal before us will go much further, with 
initial defense cuts of about $350 billion over 10 years as part of the 
initial agreement to raise the debt limit by just over $900 billion.
  The bigger threat of cuts to national security spending, however, 
will come not during this first round but through the actions of the 
joint committee this bill establishes to find another $1.2 to $1.5 
trillion in cuts as an offset to the next increase in the debt limit 
that will be required to get us from early 2012 through the balance of 
the year and into 2013. If the joint committee cannot agree on a 
package of cuts that can be passed in both the House of Representatives 
and the Senate and signed into law by the President, then a 
sequestration process would come into play that would automatically cut 
both defense and nondefense spending in order to pay for the next $1.2 
trillion in debt ceiling increases. Such an across-the-board 
sequestration of defense funding levels could add another nearly $500 
billion to the roughly $350 billion in cuts over the next 10 years.
  At his confirmation hearing on July 26, GEN Martin Dempsey, who has 
been nominated to be the next Chairman of the Joint Chiefs of Staff, 
testified that cuts above the $400 billion in defense spending that 
were already being studied would be ``extraordinarily difficult and 
very high risk.'' I agree. But what concerns me most about our current 
debate is not just the enormous size of the potential reductions but 
that the defense cuts being discussed have little to no strategic or 
military rationale to support them. They are essentially just numbers 
on a page. Our national defense planning and spending must be driven by 
considered strategy, not arbitrary arithmetic.
  These defense cuts, initially about $350 billion over 10 years--but 
especially those that could result from sequestration that could amount 
to another $500 billion--reflect minimal, if any, understanding of how 
they will be applied or what impact they will have on our defense 
capabilities or our national security. While Secretary Panetta has made 
it clear that a comprehensive review will precede any decisions he 
makes on further defense cuts, the Congress currently has no specific 
indication of how the current debt compromise proposals would impact 
the size of our military forces, what changes they would require to our 
compensation system, what equipment and weapons would have to be 
cancelled as a result, or what additional risk to the readiness and 
modernization of our forces and their equipment we would have to 
accept. If Congress is to make informed decisions about our national 
defense spending, we need information like this, and it will have a 
crucial impact on how the joint committee created under this compromise 
goes about its work. And based on that sort of information, we must do 
everything we can to avoid an exercise in blind sequestration of 
defense funds that could come into play if the joint committee cannot 
find a way to find further cuts of $1.2 trillion or more that can be 
enacted into law.
  For many months, we have been engaged in a political tug-of-war over 
whether we should raise the debt limit and allow the President greater 
borrowing authority. I joined my colleagues on this side of the aisle 
in our insistence that any increase in our debt ceiling be accompanied 
by meaningful, real cuts in spending, not just typical Washington-style 
smoke and mirrors. I believe we achieved our goal with this compromise. 
The deal before us provides at least one dollar of actual spending 
cuts, not gimmicks, for each dollar in debt limit increases. It doesn't 
raise a single dollar in taxes. By including upfront cuts, a joint 
committee, a balanced budget amendment, BBA, vote, the debt disapproval 
process and sequesters, it continues the pressure on the President and 
Congress to continue cutting spending through the next election and 
beyond.
  Some of my colleagues from the other side of the aisle have described 
the debate on this issue as a ``manufactured crisis.'' They cite the 
fact that, in the past, we routinely raised the debt ceiling with 
little or no debate, having done so at least 10 times in the last ten 
years. Well, I say to my friends, you are leaving out one very critical 
detail in your analysis--a detail that makes our current situation 
anything but ``routine''--and that is this: Never before in the history 
of this great nation has our debt been $14.6 trillion. Never before in 
our history have we faced the possibility of having our 
creditworthiness downgraded due to our inability to control our 
spiraling debt, which could very well decimate the good faith and 
credit of the United States, which would have a severe impact on our 
standing in the world.
  This measure represents the beginning, not the end, of what I believe 
will be a sustained national focus on getting our fiscal house in 
order. We still have a very long way to go and a great deal of hard 
work to do. Americans are still hurting. Unemployment remains at 
unacceptable levels and is estimated to continue to grow. We need to 
cut spending, spur economic growth, and get people back to work. These 
goals cannot be achieved by raising taxes on individuals and small 
businesses, and they cannot be achieved by expanding the size of 
government and massively increasing federal spending. It is time we 
learned from the lessons of the past, and the past has taught us that 
we cannot spend and tax our way to prosperity. America has been driven 
down that road, and we nearly plunged off of a cliff into economic 
disaster. I believe that this measure will begin to put us on the right 
track.
  I urge my colleagues to seize this opportunity to put America back on 
a path to fiscal solvency and vote in favor of this compromise.
  Mr. KOHL. Mr. President, I rise today to support the budget agreement 
that has been so painstakingly negotiated over these past several 
weeks. This is not a perfect bill, but it will start to get our budget 
deficit under control. Failing to reach an agreement and allowing our 
nation to default is not an option.
  Failing to raise the debt ceiling would mean failing to honor the 
obligations we have already made. Previous Congresses and 
administrations have always recognized this duty, raising the debt 
ceiling over 70 times since 1962. This is not a partisan issue. 
President George W. Bush signed seven debt ceiling increases and 
President Clinton signed four. President Reagan raised the debt ceiling 
18 times.
  We have also agreed to reduce our Nation's debt by over $2 trillion, 
which will help to put us on a more sustainable fiscal path. Much of 
this budget savings will be found by a new joint congressional 
committee. Their recommendations will likely be similar to the Bowles-
Simpson recommendations, the Gang of 6 proposal, and other bipartisan 
efforts.
  I must say that I am disappointed we could not get a broader 
agreement to

[[Page S5216]]

reduce our deficit. We know what we need to do. Every bipartisan 
proposal works by putting everything on the table: domestic spending, 
defense, entitlements, and revenue. It is not a good sign that this 
bill would force only spending cuts if Congress fails to pass the joint 
committee's deficit reduction bill. Refusing to put everything on the 
table means refusing to truly solve our budget problem.
  Our system of government is built on compromise. This deal shows that 
the Senate is still capable of governing, and now we need to return 
immediately to the most important job, getting our people back to work 
and getting the economy back on track.
  Mr. REED. Mr. President, these are challenging economic times and 
Republicans have taken us to the edge of the cliff. In the limited time 
left to prevent government default for the first time in our Nation's 
history, I think we can all agree on at least one thing--the 
consequences of default benefit no one. That is why I made the 
necessary but difficult decision today to support an agreement to 
prevent our economy from being driven off the cliff.
  Default and a downgrade of our credit have the potential to cause job 
loss, higher interest rates, and another economic recession or even a 
depression. Unfortunately, the legislation before us today only staves 
off potential default, while doing nothing to fuel job creation and 
spur economic growth. In fact, it could well increase recessionary 
pressures on the economy.
  As the richest country in the world, we should never have reached 
this crisis point. The United States always pays its bills. And, let's 
be clear, the bills we are talking about are not new ones; they exist 
because of prior policy decisions.
  Fault for the linking default on our debt and an ideological budget 
plan rests with my Republican colleagues. The President thought he 
could negotiate a grand bargain, but it turned out Republicans were not 
interested in compromise.
  Since the onset of the debate surrounding the need to raise the debt 
ceiling, the American people have made their position clear: They want 
a fair and balanced approach to reducing the deficit. Like the majority 
of Americans, I understand the need to get our fiscal house in order, 
and I took tough votes in the 1990s to create a record budget surplus. 
On Sunday, I also voted for a plan that would have controlled spending 
to a greater extent than the bill before us today.
  As in the 1990s, and so many other times in the past, reining in the 
budget deficit has meant spending cuts and revenue from closing 
loopholes in the Tax Code enjoyed by the wealthiest Americans and 
biggest corporations.
  Despite this precedent and the fact that such changes would not take 
effect in the short term, Republicans refused to accept a balanced 
approach.
  Indeed, the price for averting the economic disaster of failing to 
raise the debt ceiling--a failure that some of my Republican colleagues 
were quite willing to see happen, to have our Nation go off the cliff--
was a deal predicated on sacrifice by the middle class and no one else.
  And so the agreement forged by the President and congressional 
leaders is by no measure ideal. It not only makes fundamental 
concessions, but ignores the No. 1 issue on the minds of Americans--
which is how to address job creation and the unemployment situation.
  In doing so, it also evades not only common sense but ignores 
economists who have warned that this trend toward drastic cuts threaten 
to choke off a faltering recovery. Former Labor Secretary Robert Reich 
expressed these sentiments in saying that the agreement: ``[. . .] 
hobbles the capacity of the government to respond to the jobs and 
growth crisis.''
  This agreement doesn't extend unemployment insurance at a time when 
too many Americans remain out of work. It doesn't stave off automatic 
tax increases on employers in distressed States with outstanding loans 
from the UI trust fund. Nor does it include common sense measures to 
save jobs like work sharing, which has proved so effective in some of 
our states and abroad, nor infrastructure spending to create jobs.
  Instead, the first part of this agreement includes spending cuts that 
could hurt the middle class and those in need--nearly $1 trillion--at a 
time when Americans can literally least afford it. While working men 
and women are coping with stagnant wages, 14 million other Americans 
are simply without a job in an economy that is still climbing out of a 
deep economic recession. In Rhode Island the jobs situation remains 
especially difficult and double-digit unemployment persists.
  Rather than set in place a longer term debt reduction agreement that 
would bring much-needed certainty to the economy, this agreement brings 
unnecessary uncertainty by tasking a joint committee to come up with at 
least $1.2 trillion in deficit reduction. These recommendations would 
receive expedited consideration with no amendments before the end of 
the year. A failure of this committee to come up with the required 
level of cuts or a rejection by the Congress or a veto by the President 
of the committee's recommendations would mean sequestration--automatic 
across the board cuts, half to domestic and half to defense spending.
  I support the need to make continued decisions to eliminate wasteful 
and duplicative spending, and I perhaps this committee could come to a 
fair and balanced approach. Yet there remains a real likelihood that 
Republicans could very well dig in again on the question of ending tax 
giveaways to very profitable corporations and millionaires and call for 
drastic changes to Social Security, Medicare, and Medicaid in order to 
meet targeted savings. The Joint Committee could also reverse the gains 
we made to reform health care.
  In fact, Speaker Boehner, in presenting this legislation to his 
Republican conference, said that it would be effectively impossible for 
the joint committee to raise revenue. This means that the joint 
committee could recommend legislation even more austere and imbalanced 
than the $917 billion in cuts we are passing today. Republicans could 
again choose to balance the budget on the back of middle-class 
Americans. What should make us think that a few months down the road 
Washington Republicans will sing another tune and be willing to put 
revenue on the table?
  Cuts are about more than just numbers. They are about priorities, and 
I worry that the cuts from the joint committee or from sequestration 
would continue to be based on Republicans' extreme ideological beliefs, 
and not on common sense priorities like jobs and the well-being of the 
middle class.
  The bill before us has two outcomes as I see it. The unknowns of a 
joint committee that, depending on who you talk to, will either fail 
spectacularly or succeed spectacularly in producing a balanced proposal 
of shared sacrifice. The thought is that the threat of sequestration, 
which should be considered a meat cleaver approach to priorities, could 
produce an equitable compromise by the joint committee. Others believe 
sequestration will somehow be ameliorated or avoided altogether--that 
Congress will somehow pass legislation in the future to blunt its 
impact. I hope those positive predictions prevail, but I am dubious.
  In this spirit, the agreement marks a turning point for our nation at 
an extraordinary time. Following the Great Depression, we faced another 
set of extenuating economic circumstances. And only after years of 
misguided cuts urged by fiscal conservatives, did the Congress finally 
listen to those who voiced the need for spending to buttress economic 
growth.
  It is widely known that the best way to ensure economic recovery is 
to get people working--paying taxes and stimulating demand that has a 
multiplying effect on our economy.
  Of course the irony of the situation lies in how we got here. 
President Bush was handed the biggest surplus on record, $236 billion--
indeed, we had 3 straight years of budget surplus before he drowned our 
Nation in red ink as far as the eye can see.
  In fact, Republicans at the time were concerned the budget surplus--
which was projected to be $5.6 trillion over 10 years--was in itself a 
danger. Federal Reserve Chairmen Greenspan expressed this sentiment: 
``The emerging key fiscal policy need is to address the implications of 
maintaining surpluses beyond the point at which publicly held debt is 
effectively eliminated.''
  The resulting Bush policies--led by the $1.8 trillion tax cuts skewed 
to the

[[Page S5217]]

those making over $250,000--erased this record surplus, and replaced it 
with a $6.2 trillion deficit over this time period. This is an 
extraordinary swing of $11.8 trillion from fiscal year 2002 to 2011. To 
give some comparison, our current-dollar-GDP, the market value of the 
Nation's output of goods and services, is approximately $15 trillion.
  While Americans are hard pressed to make ends meet and find work in 
an economy that isn't creating enough jobs, the largest corporations 
are doing extremely well.
  We are seeing now corporations rack up huge profits. The nonfinancial 
members of the S&P 500 index are sitting on about $1.1 trillion in 
cash. The Federal Reserve indicated similarly that nonfinancial 
businesses have about $1.9 trillion in cash defined as liquid assets. 
We need policies that get businesses to make investments that put 
Americans back to work.
  So a better approach would involve a serious commitment to deficit 
reduction that asks more from all Americans in the interest of our 
Nation's long-term economic wellbeing. It would be bigger than the bill 
before us, perhaps closer to $4 trillion in debt reduction, because it 
would be balanced and would call for shared sacrifice. It would ask the 
wealthiest Americans and largest corporations to pay their fair share 
instead of relying solely on spending cuts that will hurt programs that 
Americans depend on particularly when economic growth remains fragile. 
This view is in line with numerous economic experts who have voiced 
concern about how cutting back too soon could undermine our recovery.
  A better bill would finally discard the perverse tax loopholes that 
reward companies that ship jobs overseas and end ethanol subsidy 
giveaways to profitable corporations. Put simply, a balanced approach 
wouldn't ask nursing home residents to sacrifice without asking the 
same of wealthy folks.
  In fact, I have voted for plans that took this balanced approach in 
1993 and 1997 and helped create a record surplus.
  I have also voted against those proposals that have built up this 
mound of debt--including the unfunded Bush tax cuts skewed to the 
wealthy; an unpaid for war in Iraq for which we have paid dearly; and 
the unpaid for, costly, and ill-designed Medicare prescription drug 
plan.
  We are also missing an opportunity to address the broader problems 
facing middle-class Americans. They are struggling in large part 
because we are going down a road of conservative ideology rather than 
common sense. We need to work on economic growth through education, 
infrastructure, currency exchange fairness, a trade policy that 
supports our manufacturers, and yes even tax reform to simplify our 
system but not as an excuse for more tax giveaways like the Bush tax 
cuts.
  Just as I have taken tough votes in the past to ensure the long-term 
prosperity of our Nation, today's vote was another difficult choice.
  However, this agreement is the only option left to prevent default 
and evade what would be the greatest artificial crisis in our Nation's 
history. It hopefully provides a powerful lever to achieve significant 
and smart deficit reduction in the future.
  In the words of President Franklin Delano Roosevelt during his second 
inaugural address, ``Government is competent when all who compose it 
work as trustees for the whole people.''
  Now is one of those pivotal times in our Nation's history, where we 
face a stark choice that requires us to make sacrifices that put nation 
ahead of self.
  For over 200 years, this country has been known as a hallmark of 
economic stability. We have always paid our bills regardless of who was 
President and what party was in charge.
  Now that this manufactured crisis that has distracted us for too long 
is over, we need to get to the business of putting Americans back to 
work.
  Mr. RUBIO. Mr. President, I cannot support this plan because it fails 
to actually solve our debt problem, fails to diminish the risk of a 
credit rating downgrade and is not a long-term solution to avert a debt 
crisis. This plan still adds at least $7 trillion to our debt over 10 
years. It fails to immediately start downsizing government, leaving 98 
percent of deficit reduction until after the 2012 election. By not 
addressing the biggest driver of our debt, health care spending, this 
plan ensures Medicare's looming bankruptcy, while protecting 
ObamaCare's $2.6 trillion blank check.
  It contains no real structural reforms to spending, such as a 
constitutional balanced budget amendment. It fails to reduce spending 
by what credit rating agencies say is at least $4 trillion to avert a 
downgrade. Worst of all is that at a time of 9.2 percent unemployment, 
this plan fails to include pro-growth measures to help get people back 
to work and create new taxpayers to help us pay down the debt. In fact, 
I fear that the new ``Supercommittee'' in this bill could lead to 
expedited consideration of big tax hikes on our struggling economy. And 
if Congress rejects new taxes, then up to $850 billion of devastating 
automatic defense spending cuts would be triggered at a time when the 
world is as dangerous as it has ever been.
  Americans are looking at Washington with anger, disgust and concern 
that maybe America's problems are just too big for our leaders to 
solve. As I outlined in the Wall Street Journal on March 30, 2011, 
keeping America exceptional will require spending cuts and caps, saving 
Medicare and Social Security from bankruptcy, a constitutional balanced 
budget amendment, tax reform and regulatory reform. Above all, it will 
require courage.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. KYL. Mr. President, I will support this legislation but with very 
serious reservations.
  I start with the premise that this debt limit extension is not the 
one piece of legislation that will change everything wrong in 
Washington. It is, at best, a reversal of previous tax-and-spend 
policies, with some movement down the road to fiscal responsibility.
  The bill sets us on a course that, if we adhere to it, will 
eventually enable us to balance our budget, draw down our debt, put 
entitlement programs on a sustainable path, and create the conditions 
for strong economic growth. That it could have been better is 
absolutely true as a substantive matter, but politically, the White 
House and the tax-and-spend Democrats in Congress would not agree to 
more. They control this Chamber and the executive branch of government.
  A second premise of Republican leadership was that the U.S. 
Government must pay its bills, not just to investors in U.S. bonds but 
to fulfill its commitments to the American people. From Social Security 
to national defense, we have obligations that Republicans insist must 
be met. So default was not an option. That meant agreeing to terms for 
a debt extension that satisfied neither party.
  Another premise is to focus on job creation and restoring a healthy 
economy. That meant not only constraining Washington spending through 
greater accountability but preventing job-killing tax hikes. In this, 
we succeeded. Contrary to some public talk, there is nothing in this 
legislation that would cause future tax increases. If there were, I 
would not support this legislation.
  With this legislation, we have prevented tax increases demanded by 
the President, cut spending over the next 10 years, and created a 
mechanism to address additional savings, especially in programs such as 
Medicare, Medicaid, and Social Security, all of which will eventually 
default on their commitments without reform, and we averted a credit 
crisis for the U.S. Government.
  Here is why I have such serious reservations about the legislation. 
In an effort to extract a pound of flesh from Republicans, the White 
House, frustrated that it could not raise taxes, insisted on massive 
cuts in defense spending--some $350 billion, by White House reckoning, 
over the next 10 years, potentially $18 billion less than the 
President's own budget just for next year. Moreover, the White House 
insisted that defense suffer an additional $492 billion in cuts over 
the same period if the select committee set up by this bill fails to 
produce or Congress refuses to adopt recommendations on how to cut 
overall government spending to meet the goals of the bill.
  Mind you, these cuts in defense were not the result of careful 
planning and analysis. They were just arbitrary percentages thrown out 
in negotiations, totally unconnected to actual defense requirements. 
Worse, the cuts that

[[Page S5218]]

would be triggered if the select committee recommendations fail were 
intentionally designed to be so large, so unimaginable, so 
irresponsible that Congress would be incented to approve the select 
committee's recommendations. The word ``Armageddon'' was used to 
characterize this scheme. Can you imagine anything more irresponsible, 
for the Commander in Chief of the military to promote--not just promote 
but insist on the knowing destruction of the U.S. military as a means 
to threaten Congress?
  The theory was that the consequences of inaction by the Congress must 
be so severe that no responsible Senator or Representative could dare 
allow the result that we would be forced to accept the select committee 
recommendations on pain of seeing the U.S. military decimated. This 
should never have been agreed to by Members of Congress but most of all 
never promoted by the President. To me, it comes close to violating our 
oath of office and the President's responsibilities as Commander in 
Chief. But it is done. My vote will not change it.
  The best way for me to avoid this Armageddon is to stay in the fight 
and, if necessary, urge my colleagues to disregard this provision. 
Sixty Senators would have to agree. But I cannot imagine Senators, and 
even the President, when faced with the actual versus the hypothetical 
choice of knowingly destroying our military capacity to protect the 
United States, would allow it to happen when we would have the ability 
to prevent it. As reckless as this President is to even contemplate, 
much less threaten, to incapacitate our military, I cannot imagine the 
American people would countenance such action.
  As I evaluate the work of the committee, if anyone says to me, 
remember, the trigger is Armageddon for the U.S. military, my response 
will be, let's take that debate to the American people and let them 
decide. The thought that this trigger would force Senators to make 
unwise concessions underestimates the American people's commitment to 
their own security. The White House is miscalculating. It is so 
Draconian that it will not work. Even this President could not 
implement it.
  So because we cannot default in our commitments, because we have to 
start somewhere on our new journey toward fiscal sanity--and this is a 
good start--because we have to focus on job creation, not more taxes 
that will kill job creation, we should adopt this legislation. But 
because of its irresponsible and dangerous, even cavalier treatment of 
national defense, we will need to work very hard to restore spending 
necessary for our national security and commit to reject the threat of 
Armageddon inserted into this bill by the White House.
  (Mr. DURBIN assumed the Chair.)


                         Joint Select Committee

  Mr. REID. Mr. President, I would like to engage in a colloquy with my 
friend the Republican leader, with whom I worked in drafting the 
provisions of this bill creating a joint committee to address deficit 
reduction. We wrote a number of deadlines in the bill to guide the work 
of the joint committee. I wanted to discuss with my colleague the 
consequences of missing these deadlines.
  Section 402(g) of the amendment before us makes clear that if the 
joint committee fails to meet the November 23 deadline to vote on the 
report and proposed language, or if the Congress fails to meet the 
December 23 deadline to pass the joint committee bill, then the joint 
committee bill will lose its privilege. It would cease to benefit from 
expedited procedures under this amendment.
  But I also want to make clear that if the joint committee or Congress 
fails to meet other deadlines in the title creating the joint 
committee, then that failure would not lead to a loss of privilege. We 
attached special importance to the deadlines for the committee to vote 
and the Congress ultimately to act.
  And so, I would like to inquire whether the Republican leader agrees 
with that assessment.
  Mr. McCONNELL. Mr. President, I agree with the majority leader. We 
did attach special importance to the deadlines for the committee to 
vote and the Congress ultimately to act. And we did not intend for 
failure to meet other deadlines in the title to cause the joint 
committee bill to lose its privilege.
  Mr. REID. Mr. President, I would like to engage in a colloquy with my 
colleague the chairman of the Budget Committee, Senator Conrad, who 
worked with me as we drafted the joint committee language in this bill.
  The compromise we are voting on today on the debt limit establishes 
the Joint Select Committee on Deficit Reduction to build on the more 
than $900 billion in up-front deficit reduction in the bill. The joint 
committee would work to achieve another $1.5 trillion in deficit 
reduction, for a total of $2.4 trillion. This important joint committee 
will be bicameral and bipartisan, with three members selected by each 
of the four congressional leaders, for a total of 12 members, evenly 
split between Democrats and Republicans. Importantly, their 
recommendations will be guaranteed an up-or-down vote on the floor of 
both the Senate and the House.
  For this historic process to work, we felt it important that the 
joint committee be given maximum flexibility, with everything on the 
table--discretionary spending, entitlements and other mandatory 
spending, and tax reform. To accomplish this goal, the joint committee 
should similarly be given maximum flexibility in how it analyzes its 
work and how it determines that it has met the target of $1.5 trillion 
in deficit reduction.
  Mr. President, over the past year, we have had three distinguished 
bipartisan groups provide us with comprehensive deficit reduction 
packages. We had the President's Fiscal Commission, led by former White 
House Chief of Staff Erskine Bowles and former Senator Alan Simpson. We 
had the Bipartisan Policy Center's Debt Reduction Task Force, led by 
former Senator Pete Domenici and former CBO and OMB Director Alice 
Rivlin. And we just had the so-called Group of 6, a bipartisan group of 
Senators, including Senator Conrad, and Senators Warner, Chambliss, 
Durbin, Crapo, and Coburn. All three of these groups decided that given 
the comprehensive and complex nature of the work that they were doing, 
they needed to take advantage of the flexibility to measure the effects 
of their proposals against the most accurate benchmark possible. I 
believe that it is critical that the joint committee have the same 
flexibility to decide on and use the most appropriate baseline possible 
for its work.
  I believe that the legislation that we will vote on today 
accomplishes that, most directly by mandating the joint committee to 
include a statement of deficit reduction as part of the legislation it 
must vote on. There are no conditions on that statement. But, 
obviously, the legislation will need to have bipartisan support to pass 
the House and Senate.
  I wonder if the chairman of the Budget Committee would agree with my 
conclusion.
  Mr. CONRAD. Mr. President, I think it is absolutely correct that the 
flexibility exists for the Joint Committee to determine the benchmark 
it wishes to use and that such flexibility is entirely appropriate 
given the circumstances.
  The leader mentioned three bipartisan groups that came to a similar 
conclusion. I was a member of two of those groups, the President's 
Fiscal Commission and the so-called Group of 6. We devoted considerable 
time to considering the most appropriate baseline to use in our 
deliberations given our goals. In both cases, on a bipartisan basis, we 
decided what made the most sense was not a standard current law 
baseline, as CBO normally uses for the work we do around here, but a 
baseline that was adjusted for more realistic policies, such as more 
realistic war costs, more realistic tax policies, and more realistic 
health spending given the need to regularly provide the so-called doc 
fix. I can tell the leader that having that flexibility was critical to 
both groups reaching completion of its work. The joint committee should 
have that same flexibility, and I believe the bill provides it.
  Mr. REID. I thank the chairman of the Budget Committee, who is the 
Senate's expert on such matters.
  Mr. McCONNELL. Mr. President, over the past few weeks, Congress has 
been engaged in a very important debate. It may have been messy, it 
might have appeared to some as though their government wasn't working, 
but in fact the opposite was true. The push

[[Page S5219]]

and pull Americans saw in Washington these past few weeks was not 
gridlock, it was the will of the people working itself out in a 
political system that was never meant to be pretty.
  You see, one reason America isn't already facing the kind of crisis 
we see in Europe is that Presidents and majority parties here can't 
just bring about change on a dime, as much as they might wish to from 
time to time. That is what checks and balances is all about, and that 
is the kind of balance Americans voted for in November. The American 
people sent a wave of new lawmakers to Congress in last November's 
election with a very clear mandate: Put our Nation's fiscal house in 
order. Those of us who had been fighting the big government policies of 
Democratic majorities in Congress welcomed them into our ranks. 
Together, we have held the line, and slowly but surely we have started 
turning things around. That is why those who think that no problem is 
too big or too small for government to solve are very worried right 
now. They are afraid the American people may actually win the larger 
debate we have been having around here about the size and the scope of 
government and that the spending spree may actually be coming to an 
end. They can't believe those who stood up for limited government and 
accountability have actually changed the terms of the debate here in 
Washington. But today, they have no choice but to admit it.
  I know for some of our colleagues reform isn't coming as fast as they 
would wish, and I certainly understand their frustration. I too wish we 
could stand here today enacting something much more ambitious. But I am 
encouraged by the thought these new Senators will help lead this fight 
until we finish the job. I want to assure them that today, although 
they may not see it this way, they have actually won this debate.
  In a few minutes, the Senate will vote on legislation that represents 
a new way of doing business in Washington. First, it creates an 
entirely new template for raising the Nation's debt limit. One of the 
most important aspects of this legislation is the fact that never again 
will any President, from either party, be allowed to raise the debt 
ceiling without being held accountable for it by the American people, 
and, in addition, without having to engage in the kind of debate we 
have just come through. Because, you see, whoever the next President is 
will be back asking to raise the debt ceiling again, and it will 
provide another opportunity for us to focus on the subject raised by 
the request to raise the debt ceiling.
  So we will be back at it--probably in the early part of 2013--trying 
to continue to make progress toward reducing the size and scope of 
government and reducing our spending. This kind of discussion isn't 
something to dread, it is something to welcome. While the President may 
not have particularly enjoyed this debate we have been through, it is 
the debate Washington very much needed to have.
  As for the particulars, this legislation caps spending over the next 
10 years with a mechanism that ensures these cuts actually stick. It 
protects the American people from a government default that would have 
affected every single one of them in one way or another. It puts in 
place a powerful joint committee that will recommend further cuts and 
much-needed reforms. It doesn't include a dime, not a dime, in job-
killing tax hikes at a moment when our economy can least afford them. 
Crucially, it ensures the debate over a balanced budget amendment 
continues and that it actually gets a vote.
  This is no small feat when one considers that last week the President 
was still demanding tax hikes as part of any debt ceiling increase, and 
that as recently as May, the President's top economic adviser said it 
was ``insane'' for anybody to even consider tying the debt ceiling to 
spending cuts. It is worth noting that 2\1/2\ months later, that 
adviser is no longer working at the White House and the President is 
now agreeing, as a condition of raising the debt ceiling, to trillions 
of dollars in spending cuts.
  Let me be clear: The legislation the Senate is about to vote on is 
just a first step. But it is a crucial step toward fiscal sanity and 
its potentially remarkable achievement given the lengths to which some 
in Washington have gone to ensure a status quo that is suffocating 
growth, crippling the economy, and imperiling entitlements.

  We have had to settle for less than we wanted, but what we have 
achieved is in no way insignificant. We did it because we had something 
Democrats didn't have: Republicans may only control one-half of one-
third of the government in Washington, but the American people agreed 
with us on the nature of the problem. They know government didn't 
accumulate $14.5 trillion in debt because it didn't tax enough. If 
someone is spending themselves into oblivion, the solution isn't to 
spend more; it is to spend less.
  Neither side got everything it wanted in these negotiations, but I 
think it was the view of those in my party that we tried to get as much 
in spending cuts as we could from a government we didn't control. Our 
view was we would get as much in spending reduction as we could from a 
government we didn't control. That is what we have done with this 
bipartisan agreement.
  This is not the deficit-reduction package I would have written. The 
fact that we are on a pace to add another $7 trillion to the debt over 
the next 10 years is certainly nothing to celebrate. But getting it 
there from more than $9 trillion the President continued to defend 
until recently is no defeat either. Slowing down the big government 
freight train from its current trajectory will give us the time we need 
to work toward a real solution or give the American people the time 
they need to have their voices heard.
  So much work remains. To that end, our first step will be to make 
sure Republicans who sit on the powerful cost-cutting committee are 
serious people who put the best interests of the American people and 
the principles that we have fought for throughout this debate first. 
But before we move to the next steps, I would like to say a word about 
some of those who made today's vote possible, and I will start with 
Speaker Boehner.
  It should be noted that he helped set the terms of this debate by 
insisting early on that we would oppose any debt limit that didn't 
include cuts that were greater than the amount the debt limit would be 
raised, and he stuck to his guns. The Speaker and I worked shoulder to 
shoulder over the past few months, and it certainly has been a 
pleasure. He has been a real partner, and I assure my colleagues we 
wouldn't be here without him.
  So I want to thank the Speaker and the entire Republican leadership 
in the House for standing on principle, and I want to thank my 
Republican colleagues in the Senate for their determination, their 
ideas, and their support. We wouldn't be here without them either.
  I thank my friend, the majority leader, for his work in getting this 
agreement over the finish line. We may disagree a lot, but I hope 
everyone realizes it is never ever personal. I think today we can prove 
that, when it comes down to it, we will get together when the greater 
good is at stake.
  I also thank the President and the Vice President and everyone on 
their staffs who believed, as we did, that despite our many differences 
we could all agree that America would not default on its obligations. 
It is a testament to the goodwill of those on both sides that we were 
able to reach this agreement in time. Neither side wanted to see the 
government default, and I am pleased we were able to work together to 
avoid it.
  This bill does not solve the problem, but it at least forces 
Washington to admit that it has one. The bill doesn't solve the 
problem, but it forces Washington to admit that it has one. It puts us 
on a path to recovery. We are nowhere near where we need to be in terms 
of restoring balance, but there should be absolutely no doubt about 
this: We have changed the debate, we are headed in the right direction, 
and people are wondering how it happened. Well, it happened because the 
American people demanded it.
  So in the end, we are back to where we started. The only reason we 
are talking about passing legislation that reins in the size of 
Washington instead of growing it is because the American people 
believed they could have a real impact on the direction of their 
government. They spoke out and we heard them. It is only through their 
continued participation in this process, and

[[Page S5220]]

lawmakers who are willing to listen to them, that we will complete the 
work we have begun.
  As Winston Churchill once said:

       Courage is what it takes to stand up and speak. Courage is 
     also what it takes to sit down and listen.

  I can't think of a better way to sum up this last year and, in 
particular, these last few months right here in Washington than that.
  The American people want to see accountability and cooperation in 
Washington, and they want to see that we are working together to get 
our fiscal house in order. This legislation doesn't get us there, but 
for the first time in a very long time I think we can say to the 
American people that we are finally facing in the right direction. For 
that, we have them to thank.
  The PRESIDING OFFICER. The majority leader, the Senator from Nevada.
  Mr. REID. Mr. President, the eyes of the American people and the 
world have been watching Washington very closely this past week. While 
they witnessed a lot of political wrangling, they also saw Congress 
make some historically important decisions and avert a default on our 
debt that has been so concerning to all of us for such a long period of 
time.
  Our country was literally on the verge of a disaster. It was on the 
brink of a disaster. With 1 day left, we were able to get together and 
avert that disaster.
  Now, this compromise that we have reached is not perfect.
  Mr. President, could we have order, please.
  The PRESIDING OFFICER. The Senate will please come to order.
  We welcome all our visitors, and we want to make it clear that any 
disturbance or manifestation of approval or disapproval is prohibited 
under the Senate rules.
  The majority leader may proceed.
  Mr. REID. I appreciate the kind words that my counterpart, Senator 
McConnell, has stated. I have gotten to know him and Speaker Boehner a 
lot better this past month or two, especially the Speaker. Even though 
I disagree vehemently with the direction the Speaker's legislation 
took, with no bipartisan support at all, it is not the product we have 
here. The product we have here is one of compromise.
  Without trying to outline who the winners are, there is principally 
one winner throughout all this, and that is the American people. We 
settled for less than we wanted; so did my friend, the leader of the 
Republicans, settle for less than he wanted. But that is the way 
legislation works. That is the way compromise works. But I can't let go 
without responding to my friend, who boasted in his own way about the 
new Senators and new Members of Congress who came here.
  I welcome them all. But a result of the tea party direction of this 
Congress the last few months has been very disconcerting and very 
unfair to the American people. It stopped us from arriving at a 
conclusion much earlier, and we must go forward.
  Also, I recognize we have to do more. Of course, we need to do more, 
and that is why we have the joint committee set up that I will talk 
about in just a minute. The American people are not impressed with the 
no new revenue. The vast majority of Democrats, Independents, and 
Republicans think this arrangement we have just done is unfair because 
the richest of the rich have contributed nothing. The burden of what 
has taken place is on the middle class and the poor.
  My friend talks about no new taxes. Mr. President, if their theory 
was right, with these huge taxes that took place during the Bush 8 
years, the economy should be thriving. These tax cuts have not helped 
the economy. The loss of 8 million jobs during the Bush 8 years, two 
wars started, unfunded, all on borrowed money, these tax cuts all on 
borrowed money; if the tax cuts were so good, the economy should be 
thriving.
  If we go back to the prior 8 years during President Clinton's 
administration, 23 million new jobs were created. We had, when 
President Bush took office, a surplus over 10 years of $7 trillion. 
That has evaporated, and now we are talking about a $14 trillion debt.

  The compromise we reached is imperfect, and we are going to send 
legislation to the President today that will not only avert the default 
but make significant desperate reduction. Is it enough? I repeat, no, 
it is not enough. This legislation will provide our economy with the 
stability it desperately needs.
  To assure Congress that we will continue working--and I said this 
yesterday, I say it again. I appreciate my friend, the Republican 
leader, putting his arms around the idea that I came up with to have 
this joint committee. They have worked in decades past. There is no 
reason it can't work now. There is no supermajority. Each leader will 
appoint 3, a committee of 12.
  We need to do something because the trigger that kicks in is very 
difficult. We need to do this, and it has to be one that is fair. The 
American people demand fairness. It can't be more cuts to programs that 
have made this country what it is. There must be a sharing of 
sacrifice. It is unfair for billionaires and multimillionaires not to 
contribute to the arrangement that we have just made, but they are not.
  My friends, the Republicans, held firm on no revenue, which is too 
bad. We need to have a fair approach to this joint committee, and I am 
confident we will do that. The one reason we are going to do that is 
because the trigger mechanism kicks in.
  To this committee that is going to be appointed, the Members must 
have open minds. We have had too much talk the last few days, as early 
as this morning, Republican leaders in the Senate saying there will be 
no revenue. That is not going to happen; otherwise, the trigger is 
going to kick in. The only way we can arrive at a fair arrangement for 
the American people with this joint committee is to have equal sharing.
  It is going to be painful. For each party, if they do the right 
thing, it is going to be painful because, to be fair, we have to move 
forward. There has to be equal spending cuts. There has to be some 
revenue that matches that.
  The legislation that is going to be sent to the President today ends 
the standoff that ground the work of Washington to a halt this summer. 
So Congress must now return to its most important job: creating jobs.
  Mr. President, there are things we can do to create jobs and we know 
that. We passed out of here quickly the patent bill: 27,000 jobs we are 
told that legislation will create. So we will move to that; the first 
time we get back after the summer break, we are going to move to the 
patent legislation. It is important we do that. There is other work we 
can do. There is legislation out there that should be bipartisan in 
nature that we can do. We have a highway bill that is due.
  I have spoken to the chairman of the Finance Committee today, and 
there are ways we can fund that that should be in keeping with the 
bipartisan approach.
  The important thing we have, Mr. President, with these infrastructure 
jobs we need so very much, is that for every $1 billion we spend in 
infrastructure, we create 47,500 high-paying jobs. A lot of other jobs 
spin off from that. Now, this isn't where you have $1 billion and you 
have all these Federal Government jobs. These are moneys that go to the 
private sector to build roads and bridges and dams. We need to do that, 
and we can do that. Clean energy jobs are changing the face of this 
Nation. We need to do that.
  I am optimistic and hopeful that the spirit of compromise that has 
taken root in Washington the last several days will endure. I hope my 
Republican colleagues will join forces with Democrats when we get back 
to work and not be looking for winners in political parties. Let's 
start looking for winners with the American people.
  We have made progress toward our goal of cutting the deficit spending 
that we have around here. This Nation still faces a jobs deficit as 
well. There is no issue more important to the American people than job 
creation. Until every American who chooses to work can find a job, our 
job is undone. So we are going to continue making jobs our No. 1 
priority. We ask the Republicans to join us in this regard.
  Adlai Stevenson once called politics ``the people's business, the 
most important business there is.'' It is time for Congress to get back 
to doing the people's business, creating jobs. Nothing is more 
important than that.
  Mr. President, I ask for the yeas and nays on my motion to concur.

[[Page S5221]]

  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the motion to concur.
  The clerk will call the roll.
  The legislative clerk called the roll.
  The result was announced--yeas 74, nays 26, as follows:

                      [Rollcall Vote No. 123 Leg.]

                                YEAS--74

     Akaka
     Alexander
     Barrasso
     Baucus
     Begich
     Bennet
     Bingaman
     Blumenthal
     Blunt
     Boozman
     Boxer
     Brown (MA)
     Brown (OH)
     Burr
     Cantwell
     Cardin
     Carper
     Casey
     Cochran
     Collins
     Conrad
     Coons
     Corker
     Cornyn
     Crapo
     Durbin
     Enzi
     Feinstein
     Franken
     Hagan
     Hoeven
     Hutchison
     Inouye
     Isakson
     Johanns
     Johnson (SD)
     Kerry
     Kirk
     Klobuchar
     Kohl
     Kyl
     Landrieu
     Leahy
     Levin
     Lieberman
     Lugar
     Manchin
     McCain
     McCaskill
     McConnell
     Mikulski
     Murkowski
     Murray
     Nelson (FL)
     Portman
     Pryor
     Reed
     Reid
     Risch
     Roberts
     Rockefeller
     Schumer
     Shaheen
     Snowe
     Stabenow
     Tester
     Thune
     Udall (CO)
     Udall (NM)
     Warner
     Webb
     Whitehouse
     Wicker
     Wyden

                                NAYS--26

     Ayotte
     Chambliss
     Coats
     Coburn
     DeMint
     Gillibrand
     Graham
     Grassley
     Harkin
     Hatch
     Heller
     Inhofe
     Johnson (WI)
     Lautenberg
     Lee
     Menendez
     Merkley
     Moran
     Nelson (NE)
     Paul
     Rubio
     Sanders
     Sessions
     Shelby
     Toomey
     Vitter
  The PRESIDING OFFICER. On this question, the yeas are 74 and the nays 
are 26. The motion to concur on the House amendment to S. 365 is agreed 
to.
  Mr. REID. Mr. President, I move to reconsider the vote.
  Mrs. BOXER. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. BLUMENTHAL. Mr. President, while this agreement to raise the debt 
ceiling and cut spending is far from perfect, it averts a financial 
catastrophe that would stifle job creation and stall our fragile 
economic growth. Default would have increased interest rates for every 
American with a mortgage, car loan, student debt or credit card. For 
these reasons, I voted to support this agreement.
  Critically, the deal protects Social Security, Medicaid, Medicare and 
veterans from benefit cuts and leaves open future opportunities to 
fight tax loopholes, sweetheart deals and giveaways for special 
interests. I will certainly continue these fights and seek 
comprehensive tax reform to guarantee that there is a fair balance and 
truly shared sacrifice.
  Now more than ever, we must move to focus on our number one 
priority--creating jobs and spurring economic growth. Americans are 
still hurting, seeking to find work, stay in their homes, pay tuition 
for schools and keep their families together. We must put Connecticut 
and America back to work and get our country moving in the right 
direction.
  Mr. CONRAD. Mr. President, debate over the fiscal future of our 
Nation has been at the center of the 112th Congress. With the passage 
today of the Budget Control Act of 2011, we have avoided a default on 
our national debt, we have made a significant downpayment on our 
deficit, and we are establishing a Joint Select Committee that provides 
a real opportunity to achieve even greater deficit reduction by the end 
of this year.
  As chairman of the Senate Budget Committee, I am privileged to have a 
staff of dedicated professionals who advise me on the complicated 
budget issues that have been before this body. My staff also shares its 
expertise with Members on both sides of the aisle. They are a credit to 
the Senate, and I would like to take this opportunity to thank them for 
their hard work during the session.
  Budget Committee staff director Mary Naylor deserves particular 
credit for putting together a team that regularly provides thorough and 
accurate analysis, often on incredibly short notice. Deputy staff 
director John Righter also deserves a special mention. Mr. Righter's 
mastery of baselines and scoring has been invaluable as we have 
developed and compared various plans to address our long-term fiscal 
issues. Deputy staff director Joel Friedman and committee chief counsel 
Joe Gaeta have also played a critical role in the committee's work this 
session.
  The committee has a dedicated communications staff, including Stu 
Nagurka, Steve Posner, Adam Hughes, and Kobye Noel, that ensures that 
the committee's analysis is made available to Members and the general 
public in a clear, concise, and timely manner. In addition, committee 
analysts Steve Bailey, Jeannie Biniek, Amy Edwards, Jennifer Hanson-
Kilbride, Robyn Hiestand, Mike Jones, Sarah Kuehl Egge, Matthew Levy, 
Jim Miller, Matt Mohning, Michael Obeiter, Miles Patrie, and Brandon 
Teachout each have expertise in specific policy areas that has proven 
invaluable to me as the committee has reviewed every aspect of the 
Federal budget. The committee's support staff and staff assistants, 
Anne Page, Josh Ryan, Ben Soskin, and Ronald Storhaug have worked late 
nights and weekends to make sure we all meet the demands placed on us. 
And finally, I would like to recognize committee's chief clerk Lynne 
Seymour and administrative staffers George Woodall, Letitia Fletcher, 
Cathey Dugan, and Kathleen Llewellyn-Butts, who provide support to both 
sides of the Budget Committee.
  We as Senators place incredible demands on our staff, and they 
deserve to have their service to this institution and our country 
recognized. As we move to the next chapter of our debate over the 
federal budget, I offer my most sincere appreciation for their hard 
work.
  Mr. HATCH. Mr. President, over the last several weeks, we have been 
debating the increase in the debt ceiling. For the time being, that 
debate is coming to an end. But I would like to address briefly some 
revisionist fiscal history that we have heard repeated during that 
debate.
  We have heard this historical account often over the past decade. You 
hear it from our friends on the other side whenever the Senate 
discusses spending policy and tax policy. I have noticed that the 
arguments boil down to two points. My friend and colleague, the former 
chairman and ranking member of the Senate Finance Committee, Senator 
Grassley, came up with this thumbnail description of this creative 
historical account.
  First, all of the ``good'' fiscal history of the 1990s was derived 
from the partisan tax increase bill of 1993.
  And second, all of the ``bad'' fiscal history taking place within the 
past 10 years is because of the bipartisan tax relief plans originally 
enacted during the last administration and continued under the present 
administration.
  You could go one step further and, as a policy premise, refine that 
thumbnail description to two short sentences. First sentence--lower 
taxes are bad. Second sentence--higher taxes are good. Not 
surprisingly, these revisionist historians support higher taxes and 
higher government spending. And not surprisingly, the revisionists 
oppose cutting taxes and cutting government spending.
  Since time is short today, I direct folks to Senate floor remarks I 
made on February 14, 2011. They are available on the Senate Finance 
Committee under the Ranking Members Newsroom tab for that date. But it 
is important to reiterate the main point of those remarks. Basically 
the assertion by our friends on the other side that raising taxes is 
the key to all good fiscal history can be summarily dismissed.
  Let's take a quick view of the 1990s data. According to the Clinton 
administration's Office of Management and Budget--or OMB--the impact of 
the much-bragged about tax hike bill of 1993 was minimal. The Clinton 
administration's OMB concluded that the 1993 tax increase accounted for 
only 13 percent of deficit reduction between 1990 and 2000. Thirteen 
percent puts the 1993 tax increase behind other factors such as defense 
cuts, other revenue, and interest savings. The data show that tax 
increases did not drive deficit reduction.
  So as a matter of fact, only 13 percent of the positive fiscal 
history of the 1990s is due to the partisan 1993 tax increase? That is 
it. Thirteen percent.
  Well, what about the last decade? The period of 2001-2010 saw a lot 
of deficits. From what you hear from our friends on the other side, 
those deficits

[[Page S5222]]

are owing to the tax relief that benefitted virtually every American 
taxpayer. Yet CBO data tell us a different story.
  On May 12, 2011, CBO released a recap of the changes over the past 
decade. At the start of 2001, as everyone agrees, CBO projected a 
surplus of $5.6 trillion. Over the decade, deficits of $6.2 trillion 
materialized. That's a swing of $11.8 trillion. What did CBO say were 
the causes? My friends on the other side might be surprised to learn.
  Higher spending accounts for 44 percent of the change. Let me repeat 
that. Higher spending was the biggest driver of the deficits of the 
last decade. Economic and technical changes in the estimates accounted 
for 28 percent of the change. So all tax relief, including the tax 
relief passed by Democratic Congresses and tax relief signed into law 
by President Obama, accounts for 28 percent. The tax relief 
legislation, much maligned by our friends on the other side, accounts 
for less than half of the fiscal change attributable to tax relief. 
Specifically, the bipartisan tax relief bills of 2001 and 2003, 
including the AMT patches in those bills, accounted for 13.7 percent of 
the fiscal change of the last decade. That is not Orrin Hatch speaking. 
It's the nonpartisan congressional scorekeeper, CBO.
  So how much of the bad fiscal history of the last decade is 
attributable to tax relief? Twenty-eight percent. That is it. And that 
includes partisan bills like the stimulus. If you isolate the 
bipartisan bills that are the object of sharp criticism by our friends 
on the other side, the 2001 and 2003 legislation, you'll find that 
those bills account for only 13.7 percent of the fiscal change in the 
last decade.
  Abnormally low levels of spending contributed significantly to the 
surpluses of the 1990s. Abnormally high spending drove the deficits of 
the past decade. Abnormally high spending is driving our current 
deficits, and it will drive our future deficits as well.
  To my friends on the other side, if we focus instead on hiking taxes 
way above their historic average, we are misreading and mistreating the 
problem. The reason for our previous surpluses was low spending. And 
the reason for our current deficits is high spending. We cannot tax our 
way to fiscal health.
  But that said, for those of my friends on the other side who think 
that raising taxes is the key to our economic recovery and deficit 
reduction, I urge them to come to the floor and tell us how high they 
want to raise rates. What will do the trick? If higher taxes are the 
cure to our economic woes, do we want to go back to the pre-1986 reform 
rates of 50 percent? Or how about the Carter era rates of 70 percent? 
Or maybe even the pre-Kennedy rates of 91 percent? How high should 
rates go in order to bring down the deficit and spur our economic 
recovery?
  I want to know and America wants to know.
  Ms. SNOWE. Mr. President, I rise in support of the motion to concur 
in the House amendment to S. 365, the legislative vehicle for the debt 
limit increase. Given the $14.3 trillion national debt, the $1.6 
trillion deficit for the current fiscal year, and the unrestrained and 
skyrocketing growth of Government programs and services, this vote 
commences the debate that will lead our Government to reevaluate 
priorities and examine its spending with a critical eye.
  Today's vote was critical to maintaining our country's financial 
credibility, and it was the first step in what will be many to rein in 
the U.S. Government's out-of-control spending. This bill reduces 
current spending, caps future spending, and controls previously 
unrestrained Government budgets over the next decade, while also 
protecting critical Social Security benefits.
  Just weeks ago, the United States was warned it would lose its 
stellar AAA credit rating on two grounds: if Washington did nothing to 
address its debt and deficit spending, and if Congress failed to raise 
the debt ceiling, thus triggering a default. This vote addresses both 
issues by, for the first time in history, requiring spending reductions 
equal or greater to the amount the debt ceiling is raised. That is 
indeed a first, positive step toward making our Government accountable 
to its people.
  This action was critically important to every family in America. A 
default would have resulted in a downgrade in our Nation's credit 
rating and triggered higher interest rates for borrowing at all levels, 
from the Federal Government, to states and municipalities, to every 
American who has a mortgage, a car loan, a student loan, or a credit 
card. Failure to pass this bill would have put retirement funds at risk 
at a time when seniors are looking for financial stability and counting 
on predictability in their retirement income.
  While no one can predict how the ratings agencies will react to this 
legislation, it at least signals that our country is serious about 
getting its financial situation in order. In addition, it requires 
Congress to vote on a balanced budget amendment to the Constitution, 
which is a commonsense reform I have championed since I came to 
Congress. Mandating the Federal Government to do what nearly every 
State legislature is already required to achieve sends a message to 
every American and the world that Washington finally gets it, and at 
last understands the consequences of failing to control spending. Let 
there be no mistake--we can no longer accept budgets that compromise 
our economic growth, living standards, or opportunities that have been 
a hallmark of America's greatness.
  Though this agreement is historic, I have grave concerns about the 
supercommittee established by this legislation. Creating a 12-person 
Washington commission to do the job of 535 elected representatives is 
another indication of a broken political system in dire need of repair. 
I will work tirelessly to bring accountability, reason, and 
transparency to the decisions this supercommittee makes and presents to 
Congress for an up-or-down vote.
  This legislation initially exempts Social Security, Medicaid, and 
veterans programs from spending cuts. After the initial cuts are 
implemented, I am deeply concerned that the supercommittee could seek 
savings from Medicare, Medicaid, and defense spending. The committee 
has to recommend solid recommendations that Congress must act upon in 
order to avoid automatic cuts designed to incentivize Congress to 
fulfill this responsibility. Indeed, if the committee's recommendations 
are not adopted by Congress, automatic cuts to Medicare providers and 
defense spending could go into effect while Medicaid would be exempt. 
For these reasons, I will be especially vigilant about the work of the 
supercommittee to ensure that its recommendations achieve an equitable 
outcome.
  Moreover, this bill should have included a pro-growth strategy for 
our economy to address our cumbersome Tax Code, overly onerous and 
inefficient regulatory scheme, and a mountain of new health care costs. 
I have long advocated for a major overhaul of our Tax Code, regulatory 
reform, and a pro-jobs agenda. Indeed, throughout this year I have 
repeatedly called on our President and this Congress to focus with 
laser-like precision on jobs and the economy. Once again, I call on the 
President and the Congress to immediately turn to focus on concrete 
measures that will actually put Americans back to work.
  Indisputably, debt and deficits are a dangerous combination at a time 
when we are experiencing an unprecedented period of long-term 
unemployment with more than 22 million Americans unemployed or 
underemployed, and another 2.2 million who want a job, but are so 
discouraged they stopped looking for work altogether. In the 29 months 
since President Obama took office, unemployment has dipped below 9 
percent for only 5 months, and actually increased to 9.2 percent in 
June. Manufacturing grew at the slowest pace in 2 years in July. The 
housing downturn is worsening, with no plausible end to foreclosures in 
sight. Home prices in March fell to their lowest level since 2002. 
Consumers, confronted with higher gas and food prices, are spending 
less on discretionary items.
  And yet at a moment when every dollar Government spends should be 
wisely dedicated to job creation to return us on the path to 
prosperity, we are forced to commit an astounding $200 billion per year 
just to service our debt. The cost of net interest alone will more than 
double in the next 10 years to reach nearly $1 trillion per year in 
2021. In fact, the CBO's most recent

[[Page S5223]]

long-term outlook states that by 2035 interest costs on our Nation's 
debt would reach 9 percent of GDP, more than the U.S. currently spends 
on Social Security or Medicare. And if interest rates were just 1 
percentage point higher per year, over 10 years the deficit would 
balloon by $1.3 trillion from increased costs to pay interest on our 
debt alone.
  It is abundantly clear that we can no longer afford to borrow money 
without a clear plan in place to rein in Federal spending and force the 
Government to live within its means. Today's legislation is the first 
step in that direction.

                          ____________________