[Congressional Record Volume 163, Number 102 (Thursday, June 15, 2017)]
[Senate]
[Pages S3541-S3542]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                                The Debt

  Mr. PERDUE. Mr. President, I rise today to speak about a train wreck 
that is coming to our country right before our very eyes.
  Yesterday, the Federal Reserve, for the fourth time in the last year 
and a half, increased the Federal discount rate by one-quarter point--
one-quarter point. That is a rounding error in most people's 
imaginations; yet, I think it is a very impactful number. That is the 
fourth increase in the last year and a half that amounts to 100 basis 
points or a 1 full percentage point increase in the discount rate. With 
a $20 trillion debt, that equates to about $200 billion of new interest 
that we will be required to pay out of the revenue we get off the backs 
of working men and women in America.
  I have frequently come to this floor to speak about the $20 trillion 
debt, but, as we see what is happening now, we see the reality of what 
has been predicted over the last few years; that is, as we start 
talking about growth in the economy, we see a demand for capital and 
interest rates rising. We also see the Federal Reserve talking about 
adjusting their balance sheet--some $4.5 trillion on their balance 
sheet, the largest balance sheet they have had in history--they are now 
talking about unwinding that.
  So these are dramatic impacts on what we are talking about right now; 
that is, how we fund what we are going to be doing not only in 
healthcare but also our military, as well as the domestic programs we 
are here to talk about.
  What is even more disturbing about the debt we are talking about and 
the increases in interest is the structure of that debt. Over the last 
8 years, the prior administration decided strategically to keep our 
bond portfolio that supports this debt, the bonds we issue that pay for 
this debt--the average duration, the length of those bonds, is under 3 
years. Some 60 percent, almost, of all the government debt we have in 
the United States today matures in 3 years or less. That means these 
increases we are talking about are going to roll on us and the backs of 
the American taxpayer almost immediately. This is not something that is 
going to happen in 10 or 15 years; it is right here on us.
  Let me put that in perspective. Most every other country in the world 
that has significant debt--and there are a lot of them; not to the 
percentage that we do--have already dealt with this duration problem. 
The UK, for example, over the last 8 years, instead of going short when 
interest rates were virtually zero, they went long. Forty-eight percent 
of the United Kingdom's debt is 20 years or longer in maturity. Again, 
60 percent of our debt, because of the last administration's strategic 
decision to stay short--borrow short and spend long--that is a 
prescription for failure, in business and in government.
  Sixty percent of our debt matures in less than 3 years. That is a 
formula for absolute disaster, and that is what I am talking about.
  But even more important than the debt and the duration and the way 
these interest rate increases are going to impact us almost readily is 
the fact that we have about 43 days--I came to the floor last week and 
reported that we had 50 days left, and today we have 43 working days 
left in this fiscal year before September 30. That means we have to 
fund the Federal Government for fiscal year 2018 by the end of 
September. In the last 43 years, this body--Congress--has only done 
that four times in regular order; according to the 1974 Budget Act, 
only four times.
  What is worse than that is that in the 43 days that we have, from an 
effective standpoint, we really only have 25 working days left in this 
Senate. I would argue that with the debt ceiling, with healthcare, with 
the tax package, with the appropriations process, and the funding of 
the government, I just don't see any way that is possible. I think that 
when we are talking to the American public, we need to come clean.
  I believe that, like in most years in the past, we are going to be 
pressured in this body again, just like we have 178 times. We have been 
forced into a continuing resolution in this body in order to get past 
some arcade financing limitation we have had. So that means we have by 
the end of September to fund the Federal Government. Historically, we 
have only done that four times, according to regular order. The other 
times of the 43 years, either a CR or an omnibus was done. But 178 
continuing resolutions got us past the end of the fiscal year, moved on 
to an omnibus of some sort, and then the release valve in all of those 
occasions was more debt, more spending.
  It is very difficult because the budget process itself is broken. And 
because of that, between now and the end of September, I personally--I 
am just a business guy, but I have no imagination of how we are going 
to fund this government by passing 12 appropriations bills. As a matter 
of fact, since 1974, this body has only averaged passing 2.5 
appropriations bills a year out of the 12. Now, you tell me, in the 
next 43 days, are we going to pass 12 bills to fund this Federal 
Government? There is no way.
  So my call on our colleagues here on both sides of the aisle is, 
let's get busy right now. I don't care what the structure is, as long 
as it is not a continuing resolution because that ties the hands of our 
military. They cannot deal with that. It limits their ability to move 
money from one department to another. If they wanted to move money from 
armor to infantry just in the Army alone, they cannot do that. And with 
the risks we face around the world today, that is an impossibility.
  We are working feverishly right now to change the budget process. It 
will not affect us this year. This is something we have to get serious 
on right now.

[[Page S3542]]

  I believe we are poised to have a turnaround in this economy. 
Consumer confidence is up. It hasn't been higher than this level in 13 
years. CEO confidence is higher than it has been in 15 years. 
Manufacturing confidence hasn't been this high in over 20 years. Why? 
Because they see some regulations being rolled back right now by this 
administration and this Senate.
  We passed 13 bills out of 14 that we brought forward that pulled back 
onerous regulations. Just this week, we had the Secretary of Treasury 
tell us that some 70 percent of the limitations on our banks--not the 
controls that protect us against another 2008 and 2009 disaster but the 
controls that are unnecessary and keeping capital tied up in small and 
regional banks unnecessarily.
  We have some $6 trillion not at work in this economy because of bad 
fiscal policy right here in Washington. What we are trying to do is 
unwind that, get it back into the economy.
  By the way, if the Federal Reserve releases their $4.5 trillion and 
we don't find a way to unleash this $6 trillion, tell me where the 
capital is going to come from.
  I am here to tell you that I believe we are on the brink of an 
economic turnaround if we can, in fact, effect a reasonable improvement 
in healthcare, get on and fund the government in a responsible way 
before September 30, and move on and get a tax package done this year.
  People right now are working on their budgets for business for fiscal 
year 2018--right now. By the end of their Q3, they will have that done. 
Their capital budgets, which go out many years, are being done too. So 
they are handicapping right now whether we will in fact get that tax 
package done.
  My argument is this: Let's get these things dealt with right now on a 
timely basis--the debt ceiling, funding the government--and move on to 
this tax package so we can, in fact, get that done so that business 
entities and our free enterprise system can, in fact, budget 
accordingly so that we can get some of these benefits into the economy 
as early as late next year. If we don't get that tax package done 
before Christmas, I don't believe we will have any impact in fiscal 
year 2018 from that.