[Congressional Record Volume 165, Number 154 (Tuesday, September 24, 2019)]
[Senate]
[Pages S5643-S5646]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Budget Deficit
Mr. ENZI. Madam President, I rise to call attention to our Federal
Government's unsustainable fiscal path.
Earlier this month the Congressional Budget Office reported that
Federal
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revenues are up 3 percent, or $102 billion, compared to the same time
period last year. The problem is that Federal spending grew by 7
percent, or $271 billion, over that same period. CBO projects the
deficit for this year to reach $960 billion, which means that 22 cents
of every dollar the government spends is borrowed.
All of that borrowing doesn't come cheap. In the first 11 months of
the year, net interest payments on the public debt totaled $391
billion. That is up $48 billion, or 14 percent, over the previous year.
To put that in context, $391 billion is roughly 2\1/2\ times what we
spend each year on the U.S. Air Force. It is more than 12 times the
size of the budget of the entire U.S. Department of Justice and more
than 5 times the size of the budget for the U.S. Department of
Education. That is $391 billion spent with nothing to show for it. It
is just like running up credit card debt and owing a whole bunch of
interest without getting anything for it. That is what our future
generation is really going to have to worry about.
What is worse, unless something is done to change our current
trajectory, annual net interest costs are projected to more than double
in the next 10 years. CBO projects that over the next decade we will
spend more than $5.8 trillion on net interest costs. All the while, our
debt will continue to mount. That doesn't pay down anything; that just
pays the interest, and that is calculated at a pretty low interest
rate. We could be faced with higher interest rates, which could easily
double what we are paying right now.
We have been fortunate that despite Congress's spendthrift ways, the
U.S. dollar remains the dominant global reserve currency, which allows
our government to borrow more cheaply than anybody else. But what if
that changes? What if foreign interests decide that our fiscal
dysfunction is simply too great and the dollar is no longer a safe bet?
The threat of a fiscal crisis is not something anyone should take
lightly. Last month, the CBO--that is the Congressional Budget Office,
which does all the calculations--warned: ``If Federal debt as a
percentage of [gross domestic product] continued to rise at the pace
the Congressional Budget Office projects that it would under current
law . . . [t]hat debt path would [ultimately] pose significant risks to
the fiscal and economic outlook.''
While the Congressional Budget Office notes that those risks are not
currently apparent in financial markets, it goes on to warn that the
projected path of rising debt would increase ``the risk of a fiscal
crisis . . . in which the interest rate on federal debt rises abruptly
because investors have lost confidence in the U.S. government's fiscal
position.''
As a father and a grandfather, this is a concern that keeps me up at
night. What kind of burden are we placing on our children and on our
grandchildren? They could face a future of less growth and economic
opportunity as a result of our refusal to make difficult fiscal
decisions.
What if we actually had to make massive cuts? We don't make cuts at
all. What if we had to do massive cuts? Of course, we could raise
revenue, but there is always the side effect of raising revenue, which
costs jobs and then reduces revenue. There are a lot of tricky balances
that have to be done.
This problem didn't arise overnight, and it will not be fixed
overnight either. Congress should be working together with the
administration now to begin the long process of fiscal course
correction. Unfortunately, we are not off to a great start.
Prior to the August State work period, Congress passed the Bipartisan
Budget Act of 2019, which increased discretionary spending caps for
fiscal years 2020 and 2021 by a combined $322 billion. That is the
increase. This essentially marks the end of the Budget Control Act
period of federal budgeting. In a form that was all too common, a tool
that was meant to bring fiscal constraint met its end with a whimper,
when it probably should have been a scream.
The last cap deal--which CBO tells us will cost nearly $2 trillion
over the next 10 years if we continue spending at those levels over
that time period--featured $77 billion in offsets.
What is an offset? That is finding some money to cover the amount of
spending. I think you heard correctly there. The cap deal put us on a
path to spend nearly $2 trillion over the next 10 years with $77
billion--billion with a ``b''--in offsets, which is money to cover the
debt. To make matters worse, those offsets will not even begin to kick
in until the latter part of the next decade. In other words, we are
saying there is a little patch of money out there that we haven't spent
in the future yet, and it isn't going to come in for 10 years, but
let's go ahead and spend it right now, and we will call that an offset
to reduce the amount of debt we are creating. Boy, everybody wishes
they could do that with their own spending, I am sure.
The offsets--the money to cover the debt, which is the mere $77
billion on $2 trillion--will not come in until the latter part of the
next decade. In other words, we are spending money from 10 years down
the road right now and calling it payment on the money we are spending.
Even with this turn of events, everyone seems to agree that
discretionary spending is not the main source of our budget challenge.
The Congressional Budget Office projects America's debt will continue
to increase rapidly over the next several decades because of mandatory
spending.
What is mandatory spending? That is spending we don't make a decision
on at all. Those payments go on no matter what, and they are pretty
important ones because they include things like Social Security and the
major health programs and interest on the debt. That is mandatory. We
can't bankrupt on paying the interest, so Social Security, Medicare,
Medicaid, and interest on the debt are some of the main expenditures we
make, and we never make any decisions on them. We do not change them.
We don't improve them.
For decades, nonpartisan experts warned of budget pressures we would
face as baby boomers aged and began to retire. That is already
happening, but that crisis is always tomorrow. We only handle today's
crises. I can't imagine how tomorrow's people are going to handle the
crisis that is being created at the present time. The combination of
aging population, longer lifespans, and rising per beneficiary
healthcare costs put enormous pressure on our budget.
These warnings from the Congressional Budget Office, the actuaries,
and many other people, you name it, continue to be ignored. We are now
in a world where these pressures are very real and something we will
need to face before we go off the cliff in a few short years.
We know the Social Security trust fund and Medicare's Hospital
Insurance Trust Fund are now paying out more than they are taking in.
We also know Social Security's combined trust funds will be exhausted
in 2032. ``That is way down the road.'' No, it is not. The Medicare
Hospital Insurance Trust Fund--which covers inpatient hospital
services, hospice care, skilled nursing facilities, and home health
services--is projected to be depleted in 2026. That is not very far. If
we continue to do nothing once their respective trust funds are
exhausted, these programs will still be able to pay out some money, but
they will only be able to pay out as much in benefits as they have
coming in. I mentioned that we have a lot less coming in than we are
paying out. For Medicare, that means we will only be able to pay 86
percent of hospital-related Medicare spending. For Social Security,
revenue is projected to cover only 76 percent of scheduled benefits. I
don't know many seniors who can afford a 24-percent cut.
I want to make sure Social Security and Medicare are able to provide
benefits to current beneficiaries, as well as those who need them in
the future. That will require being clear-eyed about the problem and
working together in a bipartisan manner to ensure that these programs
are solvent. The normal technique on trying to solve any of these
problems is to point the finger at the other side and say it is their
fault and they are not doing anything about it. Well, we are all going
to have to do something about it. We are talking about a 24-percent cut
in Social Security.
The longer we wait to address the imbalance, the more severe the
changes will be and the fewer options we will have. I remember looking
at these
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problems in the year 2000, and at that time there were quite a few
options, but all were rejected. Today there are a lot less options and
a bigger cliff. We need to change the way we do things in Washington.
We simply cannot afford to continue ignoring the challenges our country
faces.
I yield the floor.
The PRESIDING OFFICER. The Senator from Georgia.
Mr. PERDUE. Madam President, I rise to talk about a topic that is
boring at times but is absolutely critical, as you just heard in the
last few minutes. My good friend from Wyoming, Senator Enzi, is a
certified public account. He lived in the real world before he came
here, like I did. He is chairman of the Budget Committee. When he
speaks about this, he speaks with the level of experience and current
information that we all should listen to.
I want to highlight some things he has already talked about but then
talk about the potential we are looking at this week in terms of having
our 187th continuing resolution since the 1974 Budget Act was put into
law. Why is this important? As Senator Enzi just pointed out, our
problem in America is twofold; one, we have a global security crisis,
and we have a financial crisis. I use the word ``crisis'' in both
because the world has never been more dangerous in my lifetime.
Today we have $22 trillion in debt. Let me put a little history
behind it. In the year 2000, we had $6 trillion on about a $12 trillion
economy. At the end of President Bush's time, it went to $10 trillion
of debt--again, on something like a $14 trillion or $15 trillion
economy. At the end of President Obama's term, it went to $20 trillion.
Under that administration, this government doubled America's debt to
$20 trillion. After just a couple of years of President Trump, we are
now at $22 trillion.
The projection is very draconian over the next decade, even though,
by growing the economy in the last couple of years, the Trump
administration has actually lowered the debt curve by an estimate that
CBO says is about $3 trillion over the next decade. That is not good
enough. That is only a fraction of our problem.
This chart on the right talks about the problem. I call it the Lamar
Alexander chart because when we talked about it 2 years ago, we started
bringing this chart up. Working on the budget process is one of the
ways we deal with this. This burgeoning debt that we have to talk about
is really made up of one major contributing factor; that is, mandatory
expenses.
This chart tries to explain that. It shows that the top line here is
total U.S. spending. Today we spend about $4.5 trillion--a little bit
more--but about $4.5 trillion funding the Federal Government. That
includes everything: Military, Medicare, Social Security, Medicaid--the
whole bit. The Federal Government spends about $4.5 trillion on
everything.
The red line is today. Today, however, we only spend $1.3 trillion on
discretionary spending. Yet in terms of the total, in 2000 we spent
less than $2 trillion. Now we are spending more than $4 trillion. That
has doubled in the last two decades. These are constant 2019 dollars.
In the next 20 years, this is projected to go from $4 trillion to $12
trillion per year, each year. In 1 year projected out here, we would
almost double the amount of debt we have. This is untenable under
anybody's estimate. It can't happen. It will not happen. Here is why.
The world can't let it happen.
Today we have about $200 trillion in total debt. Only $60 trillion of
that is sovereign debt, which is government debt. We have one-third of
that. This says that because of mandatory spending, primarily, we will
go to almost half of the world's debt with 5 percent of the population.
That is not going to happen.
Yet what will happen to keep us from doing that or becoming that will
be really draconian unless we act today. Senator Enzi is right. The
sooner we act, the more alternatives and options we have. Let me try to
explain the situation. We are actually spending less today in
discretionary spending at $1.3 trillion as a percentage of our economy
than we did in 2011. In 2011, we were spending 9 percent of our total
GDP on discretionary spending.
What is in discretionary spending? That is the military, most of the
VA, and all discretionary spending, such as Health and Human Services,
Labor, Agriculture, Justice Department, Treasury. All of the above are
included in that. That is $1.3 trillion today, which is about 6
percent. We have gone from 9 percent GDP to 6 percent GDP.
Discretionary spending has actually been brought down.
What is the problem? The problem is in mandatory. What is in
mandatory? As Senator Enzi just said, mandatory is Social Security,
Medicare, Medicaid, pension benefits on Federal employees, and the
interest on the debt. Just in the next 2 years alone, mandatory
spending goes up $420 billion. I can project that. That is within range
of understanding. What I don't understand is how this really explodes
out of control. This is because the baby boomers are maturing and going
into the later years of their lives. As you just heard, both Social
Security and Medicare--major trust funds--go to zero in a very short
period of time. Medicare happens in 2026 and Social Security in 2032.
I am here to tell you this is the crisis of our time, and we have to
deal with it. Yet today we are about to go into our 187th continuing
resolution. Why? Because we don't have an agreement to fund the
government. We are at the end of our fiscal year, which is September
30. We have 2 working days left, the way the Senate works, before that
happens. It could still be fixed, but the reality of today is that we
have not appropriated one dime for the Federal Government yet.
Last year, going into August break on July 31, we had only funded 12
percent of the Federal Government. Because we stayed here in August, we
funded up to 75 percent of the government. That was the first time in
22 years that we had gotten that far. As a matter of fact, in the last
45 years, this Congress has only funded the Federal Government on time
four times. We have actually shut the government down 21 times because
of the lack of funding. That is almost once every 2 years. It is
unbelievable.
This year, in July, we had an agreement. We did a caps deal between
the Democrats and Republicans. It was a bipartisan deal. Everybody went
kumbaya and said: Yes, this is what we agreed to. We agree to this
topline number. Appropriators had already been working all year. We had
agreements in committee. All we had to do was come back in September
and appropriate these bills, go to conference on the NDAA, and get the
Defense Department funded along with the other major departments and go
ahead down the road and get the government funded.
Here we are at the end of September. That obviously did not happen.
Why? Our good friends across the aisle violated what we thought was a
good-faith agreement in July that there would be no poison pills when
we started appropriating. We see clearly now that wasn't the case. They
are holding this up over $5 billion that the President wants to move
from military spending over to border security spending. It is almost
like they want open borders. I just don't understand this.
We know President Obama built 135 miles of wall, and we know one
thing now. We know that where President Obama built a wall, where
President Bush built a wall, where President Clinton built a wall,
where President George H. W. Bush--in every single case, illegal
crossings at the border went down 95 percent.
By voting no on this spending bill, we are now getting into a
situation where we have to go into a continuing resolution. Last week,
we voted on the Defense bill, and Democrats voted it down. They voted
against a 3.1-percent pay increase for our military brethren.
What is even worse than that, by going into a continuing resolution
and by voting no last week, the Democrats are encouraging the Defense
Department to actually spend $4 billion. We did an audit last year. It
was the first one in the history of the United States. President Trump
ordered it. We had a law in 1991 that required it. Now we had that
audit. This is the first pass. This is the tip of the iceberg. Because
of that, we know that we found at least $4 billion that they don't want
to continue spending, yet are going to be obliged to continue to spend
against those obsolete programs under a continuing resolution, in
addition to not
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getting a pay raise to our people in the military.
We should not have been here in the first place. We had a joint
select committee last year, and we have been working on this for 5
years. It is time to fix this budget process once and for all. We have
to hold Congress accountable, though. In most States, we don't have
this problem. In 44 States, No. 1, you have a balanced budget law, but
more importantly than that, in States like Georgia, if the legislature
doesn't fund the government by the end of the legislative session, by
law, the legislators don't go home.
Senator Lankford and I and others have bills that would require the
same thing here. As a matter of fact, some of us have actually put in
bills that would stop the pay for staff and employees and would stop
Members' compensation until we get this done. A requirement of our job
here is to get the government funded.
It is very simple. It is time for Congress to do its job. I am
chagrined that we face another continuing resolution that we have
educated people about and will cost hundreds of billions of dollars
over a decade because of the damage it will do to the supply chain when
we are trying to get readiness and recapitalization back in our U.S.
military and talk about rationalization. It keeps us from doing each of
those three things right now.
Anybody in the military who is before us in committee tells us over
and over and over of the damaging effects a continuing resolution has
on our military at the very time when we are trying to stand up to peer
pressures in a unique, new way. We have five threats across five
domains. We have never faced that before. Yet here we are, hamstringing
our military once again.
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. GARDNER. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.