[Congressional Record Volume 164, Number 64 (Thursday, April 19, 2018)]
[Senate]
[Pages S2311-S2313]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                           The National Debt

  Mr. PERDUE. Mr. President, I rise today to talk about a milestone 
that happened about 3 weeks ago.
  We have a couple of interesting dates. April 15 just passed. We call 
it tax day. But it was another day. It was also the date we were 
supposed to complete the Senate budget for fiscal year 2019, which 
starts on October 1 of this year. Well, April 15 came, and the IRS 
deadline did indeed hit, but there was no budget completed. This is 
part of the dysfunction that people back home are so upset about. I 
want to talk about that today, but first I want to talk about the 
derivative of that broken process.
  In my office, we have a debt clock. A few weeks ago, that debt clock 
passed a milestone: $21 trillion. If that weren't bad enough, the 
commitments of this Federal Government over the last 50 years--
actually, indeed, over the last 100 years--the commitments that have 
been made in the structural programs of this big government bureaucracy 
have committed us to some $130 trillion over just the next 30 years.
  That means that every household in America owes the equivalent of $1 
million per household. These are not theoretic numbers. These are 
mathematical realities derived from commitments made by a lot of our 
programs that we have passed over the last 100 years in this country.
  In my opinion, we are well past the tipping point with this debt. 
Last week, the CBO came out with their new forecast for fiscal year 
2018 and beyond. I want to talk about that today because there are some 
dramatic revelations in there. At $21 trillion, we are already well 
past the tipping point of this crisis.
  In my opinion, the CBO forecasts don't do a very good job of 
forecasting revenue. For example, they take very little account of 
foreign direct investment. They underestimate the impact of the change 
to the repatriation tax law we just made. I believe the revenue 
forecast is out of line, but I do agree with their forecast of 
expenses, and I

[[Page S2312]]

think therein lies a great learning, if we will pay attention to it.
  In their forecast, on top of the $21 trillion we just crossed over, 
their projection is that we will add another $10 trillion or more to 
this debt. Whether I might quibble with that a little bit or not, it is 
directionally correct. Because of that, I am on the floor of the Senate 
tonight talking about the crisis and the tipping point we are well 
past, because we are out of time to deal with this.
  In just the next 5 years, the interest on this debt alone, in the 
year 2023, will be greater than the amount of money we spend on the 
defense of this country, and that assumes a very low forecast for 
interest rates. One of the reasons for that is that the last 
administration, instead of buying bonds or putting out bonds that were 
longer in duration, put out bonds that were shorter in duration because 
they had a little lower interest rate--interest rates were 
fundamentally zero--and the rest of the world put out longer duration 
bonds. So what happens is that these shorter duration bonds are 
maturing, and when they mature they have to go out at more and more 
expensive rates.
  In just the last 18 months, the Fed fund rate has been increased six 
times, one-quarter point each. That 150 basis points on our size debt 
is more than $300 billion a year. As a matter of fact--and this is not 
a forecast--this year, the interest on our debt, the interest that we 
pay, is $50 billion more than just last year--$50 billion more than we 
spent last year. Fifty billion dollars--this is a train wreck coming at 
us, and Congress has been reluctant to deal with it straight-up.
  Every year, we go through a budget process. I have been in the budget 
process now for 3 years, since I got here. The first year we did a 
budget, it took $7.5 trillion out of the expense plan for the next 10 
years--but it lasted 4 months. It was waived by this body in order to 
get to a grand bargain so the other side would vote for funding the 
government by the end of that fiscal year and so we wouldn't have a 
shutdown.

  Last year, there was no budget done. It was basically deemed so 
Republicans could do reconciliation. Then, again, the budget for this 
year was not done. It was deemed so Republicans could again get to 
reconciliation. I believe reconciliation is being used improperly. We 
used reconciliation to try to fix healthcare and try to fix the Tax 
Code.
  Our country is at a point where this debt now has to be our No. 1 
priority. We have two crises in our country today. One is this debt 
crisis. The other, I would argue, is the global security crisis. The 
world hasn't been more dangerous than this in my lifetime, and I 
believe the two are interrelated.
  The last Congress allowed the last administration to disinvest in the 
military to a point where we are now in jeopardy of being able to 
defend our country. It is time for action.
  In business, if you get into a crisis like this, it is all hands on 
deck because it is about survival. I would argue that it is about that 
time here. The problem is that we really haven't talked about the 
problem in its entirety and what we can still do about it. I want to 
talk tonight about what is driving this.
  When we look at the numbers, it is very clear. We raise about $2.2 
trillion in taxes. That is income taxes on individuals, income taxes on 
corporations, and other sources of revenue--about $2.2 trillion. We use 
the first dollars to pay for mandatory expenses.
  We have two types of expenses: mandatory and discretionary. Mandatory 
expenses are those like your home mortgage, your car payment, your 
insurance payment, things that get deducted automatically out of your 
paycheck. We have that. It is called mandatory expenses.
  What is mandatory expenses? Social Security, Medicare, Medicaid, 
pension benefits for Federal employees, Federal retirement, veterans' 
benefits, and so forth. Those are mandatory expenses, and we subsidize 
those today. Even though there are trust funds, the Social Security and 
Medicare trust funds are not able to meet the needs of the citizens who 
are drawing benefits today. We are subsidizing out of that general 
account almost half a trillion dollars a year. If you include Medicaid 
and ObamaCare, the healthcare costs, it is almost $1 trillion, today. 
Out of the $2 trillion that we collect in taxes, about 25 percent of it 
automatically goes to those three line items. Then, about another $1.7 
trillion are then taken out. Debt service is $316 billion--almost half 
of what we spend on our military today.
  After you take all of that out, there is only about a half trillion 
dollars left. Yet we still have all of the other discretionary expenses 
that we fuss about when we do the budget. The budget only deals with 
discretionary spending. I believe that is one of our problems. What is 
in discretionary spending? Defense, veterans, and all other domestic 
discretionary spending.
  So it is $1.2 trillion. Ten years ago, it was $1.5 trillion. Because 
of the Budget Control Act and because of sequestration, discretionary 
expenses have declined in America over the last decade, partly because 
of the good work of our appropriators and because of the laws that were 
put in place.
  Fundamentally, about half of what we spend this year on discretionary 
spending, which includes the military, VA, and all the other domestic 
discretionary spending--that is the State Department, foreign aid, 
education, health, welfare, the whole bit--comes out of that. Half of 
it is borrowed money. Over the last decade, 100 percent of what we 
spent in our discretionary expenses was borrowed money. When we 
allocated money in this body for hurricane victims--and we all know we 
want to do that--every dollar we allocated was borrowed money. We had 
to go to China or to some other country and hope they are going to buy 
another issue of our government bonds in order for us to then subsidize 
our standard of living.
  I have been arguing for 5 years that our standard of living is 
somewhat artificial because of the amount of Federal debt and the 
amount of household debt in America today.
  The other thing I am so distraught about is that this would be fine 
if it were just this year. But we have a system where we have 
commitments over the next 30 years that are out of control.
  This chart shows discretionary spending historically over the last 18 
years, back to 2000. The red line is discretionary spending. The blue 
line in the last 18 years is mandatory spending. They both went up 
about the same--mandatory spending, a little more.
  But look at what happens from here forward. This is not my number. 
This is CBO's number. This is CBO on expenses behind mandatory 
expenses. Again, that is Social Security, Medicare, Medicaid, pension 
and benefits for Federal employees, and healthcare expense obligations 
of the Federal Government. This is a 20-year schedule. Again, the blue 
line is mandatory expenses and the red line is discretionary expenses. 
It goes from about $2.5 trillion this year on mandatory expenses, and 
in the 10-year period it goes to over $8 trillion.
  That is in line with what happened just in the last 16 years. In 
2000, the size of our government was $2.4 trillion. The size of our 
government in 2016, the last year of President Obama, was $4.2 
trillion. So we went from $2.4 trillion to $4.2 trillion in that 16-
year period of time, one Republican President, one Democratic 
President.
  But this is what we face. You can't tax enough, you can't grow 
enough, and you can't cut enough. There is no way we can deal with this 
without failing to meet the obligations that this country has made to 
its senior citizens and to its people in need for the last 50 years.
  What are you going to tell people when you have to tell them that the 
Social Security trust fund went to zero this year? The Medicare and 
Social Security trust funds go to zero in 14 years, and there is no 
answer for that. Today, we subsidize over a half trillion dollars into 
just Social Security and Medicare out of the taxes we raise. We never 
intended to do that. It was never supposed to happen. But past 
generations liberalized those programs to such a degree that the income 
coming in doesn't cover the outgo of those programs.
  My mother is a great example. She lived until she was 93. She passed 
away last year. She worked for 30 years; she was retired for 30 years. 
There is no way the math works when that happens.

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  In the 1930s, when they put Social Security in, it was intended to be 
a last-resort insurance supplement, not a primary go-to retirement 
plan. The life expectancy at that time was about 59; this program 
started at 62. So the math was on their side. Today, life expectancy is 
in the 80s, and we have a retirement age of 67. So we know the math 
doesn't work. This cannot happen.
  But the good news is there are five areas of work I believe that 
Congress and the administration need to begin to focus on--and now.
  First, I believe our budget process is broken. I have been on the 
Budget Committee now for 3 years, and I know it doesn't work. It hasn't 
worked but four times in 44 years to fund the Federal Government. We 
are supposed to appropriate 12 bills a year; we have averaged 2.5 over 
the last 44 years.
  Let me say that again. In any business, in any enterprise--a medical 
office, or it doesn't matter--if you were charged to do 12 items and 
you did 2.5, you would fix something. You would have to fix it, or you 
would be out of business.
  We have used continuing resolutions over 180 times. Actually, 
Congress has shut the Federal Government down, has not funded the 
government, 20 times in that 44-year history--20 times. I had no idea 
that was the case, and I bet most Americans don't either. That is 
unconscionable.
  We don't even deal with every dollar we spend in the budget. We deal 
only with 25 percent of what we spend. That is the discretionary. That 
is what we did on the budget here. This is never covered in the budget 
by law. We don't talk about it. We can no longer do this.
  The first thing you have to do is fix the budget process. Second of 
all, I believe you have to get after redundant agencies and extraneous 
expenses of the Federal Government. The GAO, the General Accountability 
Office, thinks we have somewhere around $700 billion or $800 billion of 
wasted spending every year in a $4 trillion budget. That is about 20 
percent. I believe that.
  The third thing you have to do is grow the economy. Last year, 
President Trump said job one is growing the economy. We focused on 
regulations, energy, and taxes. The economy started growing. In the 
last 12 months, we have had 3 percent GDP growth. That is 120 basis 
points above the 1.8 percent we enjoyed for 8 years--the lowest 
economic performance in our U.S. history.
  We believe, with future work on these things, that the economy will 
continue to grow. We need to work on immigration, trade, and 
infrastructure to continue this work.
  The good news is that the biggest item--the fourth item we need to 
work on is that we can solve these items; that is, we have to save 
Social Security and Medicare. When I say ``save,'' I mean we have to 
plan for the time and fix it now before the trust fund goes to zero. 
When the trust fund goes to zero, there is no way benefits can be paid 
in full. If we don't do that today, there will be a crisis of a 
magnitude that I don't want to even imagine if we let this get to that 
point. That is the fourth one.
  The fifth area of work is, we have to get at the spiraling driver of 
our healthcare costs, not the insurance that we have been fussing about 
for the last 8 years. We now really need to make a serious, concerted 
attempt in America to get after the drivers of healthcare costs.
  Those are the five areas. I am convinced that when faced with a 
crisis, Americans are always the best in history at dealing with a 
crisis. We are not always the first to recognize we are in one.
  My role tonight, as it has been for the last 3 years, is to call this 
crisis out. The CBO has all the numbers. Whether you believe them or 
not, they are correct. I would argue with their revenue numbers a 
little bit. Some might argue with their expense numbers. Bottom line, 
no matter what, you know that with a $21 trillion debt, the interest 
expense is going to grow to almost $1 trillion over the next 10 years.
  If we don't do something within this planning period of 10 years, the 
CBO says that our interest expense alone will go to $1 trillion. There 
is no way this can happen.
  We have to change the broken system. I think there has been no other 
time--I think the realization is getting there. The CBO has given us 
the numbers. The GAO has given us the opportunities and measured some 
of those opportunities.
  I think the political will in this country is now such that they 
realize we have a debt crisis, and they have more courage, I think, to 
face it than elected officials do. What drives this town is the next 
cycle. In the House, it is 2 years; in the Senate, it is 6 years: Oh, 
my goodness, we can't do anything to hurt that next cycle. We have to 
have more on our side than they have on their side.
  It is time to put that behind us. This cannot be solved with a 
partisan solution. My good friend from Rhode Island, Senator 
Whitehouse, and I have cosponsored a bill that goes after and deals 
with parts of the solution for the budget problem. There is a select 
committee right now that was formed by the leadership--Democratic and 
Republican, House and Senate. There are 16 members. I am privileged to 
be on it. I believe there are things we can do in that select committee 
to fix our budget process that would help us deal with the additional 
things we are adding to this debt crisis.
  Make no mistake, that will not solve this debt crisis. You will not 
solve the debt crisis by fixing the budget process alone, but you will 
not solve the debt crisis unless and until you do fix the budget 
process. The same thing applies to growing the economy. The same thing 
is involved with the other items we can look at in terms of redundant 
agencies and the healthcare costs in this country.
  America has come too far to fail now. We owe it to our kids, our 
grandkids, and the kids and grandkids of our kids and grandkids to deal 
with this right now.
  I met with Chairman Greenspan last year. I had the privilege to sit 
with him and talk about this very issue. He reminded me that in 1983, 
they had a solution. If we had done it in 1983, it wouldn't have been 
nearly as onerous as it is going to be when we try to fix this.
  Again, in the late nineties, Newt Gingrich and Bill Clinton 
together--two different parties--had an agreement. They got very close 
to signing it, but then it fell apart because of the political nonsense 
in this town.
  I believe the time has come right now for both sides to put our 
differences aside, live with an 80-percent solution and deal with this 
problem right now. If we don't, we will not be able to hand this to our 
kids. That is the last thing I want to close with. People say: Well, we 
are leaving our kids and grandkids a problem.
  Yes, we are. Look, in this planning period, the next 10 years, when 
interest rates are higher than what we are spending on national 
defense, that crisis is right here. It is now. We are going to see it 
in the next decade, in my opinion. It will make 2008 and 2009 pale in 
comparison.
  I have never seen a time when a crisis would pull us together any 
more ardently than this one would be right now. The question is, will 
we recognize that we are in a moment of crisis?
  I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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