[Congressional Record Volume 169, Number 83 (Wednesday, May 17, 2023)]
[House]
[Pages H2416-H2419]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         IMPENDING DEBT CRISIS

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 9, 2023, the Chair recognizes the gentleman from Arizona (Mr. 
Schweikert) for 30 minutes.
  Mr. SCHWEIKERT. Madam Speaker, we are going to actually sort of walk 
through a couple things we did last week. We are going to do it again 
because I got the feeling no one was listening.
  We had a joint economic hearing today, which, you know, I am blessed 
to be called the vice chair. We rotate the chairmanship back and forth 
between the House and the Senate. Have you ever had the occasion where 
in the hearing everyone knows the truth, but no one is allowed to 
actually say it out loud, and those of us who go and say it out loud 
sort of get fussed at? Well, as my father used to say to me: ``Screw 
them.'' We are going to actually have something unique around here. We 
are going to tell the truth.
  First off, I had my heart broken. A Bloomberg reporter this morning 
broke my heart. I was listening to one of the news readers, and they 
go, well, the U.S. is going to default maybe in the beginning of June. 
Okay. Once again, someone go get your financial dictionary. Default is 
when you do not pay the interest on your bonds. Thirty percent of our 
spending is borrowed. That basically means 70 percent we have receipts, 
income, tax revenues. We have plenty of cash to cover the interest on 
our bonds.
  Now, that doesn't mean there is not disharmony or unhappiness for 
that 30 percent that wants a check. If I hear one more idiot around 
here say we are going to have a default--that is not the definition of 
``default.''
  As a matter of fact, there used to be a Treasury Secretary under Lew, 
and he and I went around and around on this, and we finally came to an 
agreement that we would clean up our language. This would actually be 
default, not paying interest on your bonds, and we created this magic 
term called a technical default. That is when we don't send the check 
out to the worker for the agency or that goes out late. That isn't 
default.
  The financial markets care about U.S. sovereigns having their 
consistent cash flow because the fact of the matter is that is the 
basis of much of the world economy.
  We will never default even if you pass the debt ceiling. You have got 
to stop making things up around here.
  I was going to bring in the charts of the cash flow and showing what 
happens in mid-June tax receipts and how there is a quarterly spike and 
may produce another 30 days and what other extraordinary measures have 
capacity, but I realize that no one is actually listening to the facts 
anymore.
  So I thought we would try something else. If I get another person 
from the left who basically comes up and goes, we should have a clean 
debt ceiling. Really? Okay. Walk us through when you have controlled 
this body or you controlled the votes in the Senate, is that what you 
asked for? Well, the fact of the matter is, if we go back to 2017 when 
they didn't actually control the body but they had enough votes to 
extort things in the Senate, they required about $15 billion of 
additional spending, and they still voted against it.
  How about 2019? Do you remember way back in 2019--although that was 
only a couple years ago--Speaker Pelosi said, I won't give President 
Trump that increase on the debt ceiling without raising the spending 
caps and a cash spend. So the cash spend was $324 billion plus 
functionally another $300 billion on that by raising spending caps. 
That is a clean debt ceiling?
  Now, understand, what the Democrats wanted was more spending. They 
always want more spending. We are trying to bring some fiscal sanity, 
but come on. If there are any reporters out there, if there is anyone 
that wants to just sort of tell the basic story of how this place 
actually works, stop running around these hallways saying are you 
supporting default? Come on.
  You know, you may be a hard-core leftist, but at least the public 
deserves some of the basic facts. We are in real trouble. We are in 
such real trouble.
  Let's actually walk through this. Washington, D.C., Congress is 
almost incapable of adult conversation. I used to joke here that no one 
owns a calculator. When I speak to my little girl, who I want to be a 
math major, I tell her: ``Daddy works in a math-free zone.'' And she 
used to think that was funny until she started to realize it is 
probably true.
  We are only willing to do hard things when there is a stressor. You 
have ended up here. You finished your budget appropriations. You are at 
the end of the year. You are trying to see, oh, we are just going to do 
a continuing resolution, which means we are going to spend tomorrow 
what we spent yesterday, but you have got to get a vote for that new 
authorization or we are up against the debt ceiling.
  Remember, almost the only time this place has ever done something 
adult-like on policy in regard to spending debt deficits is when we 
have been up against debt limits.

  How many times do we have to show these boards? How many of you 
remember Gramm-Rudman and then the next Gramm-Rudman and the Bush tax 
increases? Remember, those tax increases were part of a deal with the 
Democrats. In fact, when was that? Oh, 1991, 1992--actually, 1990. I 
can just read my board.
  You look at these things. When there were major policy sets, they 
came because of a stressor, and that stressor was the debt ceiling. Yet 
maybe that is why the left is so terrified of an honest conversation 
here.
  My latest calculation, if I go from the day President Biden was sworn 
in until now, my best calculation is we are borrowing about $51,000 a 
second during that time--$51,000 a second. Understand, in 9 years we 
are borrowing over $90,000 a second.
  Do you understand the wheels are coming off? For some reason, my 
brothers and sisters on the left don't want to have an honest 
conversation about it. I don't know if they get votes or that is how 
they find love; they hand out trillions of dollars and they say crazy 
things like, well, the tax reform you all did in 2017. Even though by 
the fourth quarter of the next year tax receipts were higher than they 
were before the tax reform.
  Yet, the bill they passed, their Orwellian named Inflation Reduction 
Act, you have seen the new scoring. They told the American people, oh, 
well, it

[[Page H2417]]

will be under $300 billion of handouts to green energy. Fine. Okay. 
Lock that in. Instead, we now have, what is it, Goldman Sachs and 
others saying, nope, it looks like the number could be $1.2 trillion. 
Think about that. $1.2 trillion in direct sort of grants compared to 
tax reform in someone almost the same bracket of spending that was 
about growing the economy, bringing repatriation of businesses back. It 
was the fastest movement of economic growth during that economic 
period, closing of income inequality, food insecurity. We just have 
completely different visions of the world.
  So one more time, some of us care so much about telegraphing to the 
markets. Remember, the world debt markets, we are borrowing so much 
money. That $51,000 a second, you know that adds up to like $4.5 
billion a day every single day. We are consuming much of the borrowable 
lendable capital from the entire world.

                              {time}  2000

  We are chewing up so much of the world's capital that other parts of 
the world are slowing down because they don't have investment capital 
to build a new bridge or start a new business.
  Do understand the scale of what the United States is doing. If we do 
not telegraph to those debt markets that are choosing to collect 
capital from your retirement to people from all over the world, if we 
do not telegraph to them that we are taking our debt seriously, do you 
expect someone to go buy a 30-year U.S. bond at what today is about 
3.869 or something like that? I was looking at one of the postings 
earlier. You are going to buy a U.S. bond under 4 percent and believe 
you are going to get value for 30 years when the debt explodes? At the 
end of 30 years, U.S. sovereign debt is going to be close to $130 
trillion.
  What will inflation be like when you have borrowed that much money? 
The only way we would survive is you have to inflate like crazy, wipe 
out the value of all your savings, wipe out the value of that bond.
  Let's go in the way-back-machine. In 2011, U.S. sovereign debt got a 
one-tick downgrade. Standard & Poor's came in and said, no, you guys 
are AA+. I remember the Biden administration just being enraged. How 
dare you do this?
  A bunch of the folks, liars--excuse me--a number of the folks who 
wrote about it ran around saying, well, this is because of the debt 
ceiling. No, it wasn't.
  If anyone reads--now, it is not just a letter. It is an entire report 
from Standard & Poor's. Some of the takeaways from it--because we did 
not provide a credible path that we were serious about taking on our 
debt.
  The funny thing is, there is a paragraph in the report--remember, 
this is 2011. ``The political brinksmanship of recent months highlights 
what we see as America's governance and policymaking become less 
stable.'' This is 2011.
  Do you think we are better off today? Do you think we are taking our 
debt more seriously today because, do understand, I think at that time 
we were at like $9 trillion, $9.5 trillion of borrowing. Today, we are 
$31 trillion. Are you telling me things are better today?
  This is Standard & Poor's report from 2011. They downgraded United 
States debt because we did not take our debt seriously. We did not take 
seriously how we were going to manage it into the future.
  Here we are, a decade-plus later, and things are dramatically worse. 
We have now hit the inflection period of baby boomers moving into their 
benefit cycle, and we have no way to pay for it.
  We lie constantly because we are terrified to tell the truth. I will 
argue, and this is--I just wish I could get more of my brothers and 
sisters around here to make this argument.
  It is not about the stressor of the debt ceiling. The ultimate 
stressor here is if we get downgraded. If the world starts to look 
askance at U.S. debt, saying, ``Well, we want a premium for buying 
their bonds because they are not taking it seriously,'' they are going 
to have to set off a huge inflationary cycle to devalue their dollar 
so, in the future, they are paying back that debt with devalued 
dollars.
  You don't think we are going to walk into a downgrade? And do 
understand the law. There are lots and lots of laws around this country 
that this State pension system, this retirement system, you get two 
downgrades out of the three or four big rating agencies, and you get 
two of them, they can't even buy U.S. sovereigns. This is 2011. Things 
are dramatically worse.
  You don't think that we are getting looked at on how unserious we are 
about--yet, once again, debt ceiling fights, stressors, however you 
want to politely phrase it, are the only time we have done something 
rational around here.
  I don't know if I just need to buy the Financial Times or The Wall 
Street Journal or a Bloomberg subscription or something for my brothers 
and sisters on the left to read what is going on and understand that we 
are going to be punished unless we take this seriously.
  Let's go back to some of the very basics. Why do we care so much 
about the debt and what is going on?
  I have been using this same board, and I need to get an updated one. 
I just hate to spend the ink printing another one.
  Ignore 1965. I need you look at--this is 2022. Take a look at this 
pie. Do you see right here the green? That is domestic spending. Do you 
see over here the blue? That is all of defense.
  Understand, in 9 years, if you came to me and said: ``David, I need 
you to balance the budget in the 10-year window,'' in 9 years, you can 
get rid of every dime of defense, every dime of discretionary--let me 
define ``discretionary.'' ``Discretionary'' is functionally everything 
you think of government. It is the Park Service, the FBI, the White 
House, the Supreme Court, Congress. Maybe applaud for that. But all 
government is gone.
  The only thing that is left is what we call mandatory. It is the 
benefits, your Social Security, Medicare, Medicaid. It is veterans' 
benefits.
  Nine years, all government is gone as you know it. You still have to 
borrow a couple of hundred billion dollars, and in that same year, the 
Social Security trust fund is gone. In that same year, seniors take a 
25 percent cut to their Social Security check. The immorality of this 
government--we just doubled senior poverty.
  Yet, I had a President get behind that podium at the beginning of 
this year and basically say: Promise you won't talk about Social 
Security and Medicare.
  He basically sentenced seniors in this country to doubling senior 
poverty because we are not--we are all running around here terrified to 
talk about it, yet it happened.
  Go look at the CBO report, which is now functionally 8\1/2\ years, 
less than 9 years, that the Social Security trust fund is gone. If this 
inflationary cycle kicks up, and the COLA keeps as high it is, it could 
be gone in 8 years. At that moment, you double senior poverty.

  That is the immorality the left is handing us, and they walk around 
here and pretend like they care. Care by your actions, not by your 
words.
  It is almost a cultural difference we have between the right and 
left. We want to be judged by what we do, not by our virtue signaling, 
because you can't turn virtue signaling into policy.
  Let's actually walk through it. I did this chart. It is really hard 
to read, but I will try to walk through it.
  I do these floor speeches every week. I know I almost sound like an 
accountant on excessive caffeine, but at some point, the math always 
wins.
  Let's actually walk through some of the inbound we get from people 
who will watch the video or talk about this. There is one woman who 
over and over says: If we just didn't have your wages, got rid of all 
the wages of Congress and your pension, we could balance the budget. 
You read it and you wonder, is it just an insane thought or someone who 
is off their meds?
  Let's walk through some of these brilliant suggestions we get. We put 
it on this chart.
  Get rid of all of the U.S. Congress and the Senate, too, plus the 
pensions and salaries. It is gone. You have basically covered 18 to 19 
minutes of borrowing for an entire year--18 to 19 minutes of borrowing.
  Let's look at a couple of the other favorites. Let's just get rid of 
every dime of foreign aid. Every dime of foreign aid is about 17 days 
of borrowing. That is in this last year.
  Understand, by the end of this decade, it is no longer 17 days. It is 
basically, like, 9 days because the debt is

[[Page H2418]]

going up so much because it is almost all healthcare, the growth of 
debt.
  Last year, if we got rid of every dime of foreign aid, it would have 
gotten rid of 17 days of borrowing.
  You may say, fine, if that is your policy--but you got rid of only 17 
days of borrowing in an entire year.
  What if we just got rid of all the 2017 tax reform and pretend it 
didn't change all the growth effects and all the companies that moved 
their book of business back to us and their IP and all of those things? 
This is one of the Democrats' favorite points: You should get rid of 
the 2017 tax reform.
  Okay, look here. It takes care of 12 days of borrowing. Getting rid 
of the entire 2017 tax reform got rid of 12 days of borrowing. That is 
what this brain trust around here right now proposes to the American 
people.
  You are lied to because we are terrified for you to understand how 
bad the math is. This goes on and on. We can actually do a 50 percent 
income tax. If you are in California, basically your State tax, if you 
are a higher income earner, you are in the 70s. Great. Love California.
  A 50 percent income tax basically takes care of 5 to 5\1/2\ weeks of 
borrowing. It shows you how absurd many of these suggestions are.
  One of my favorite ones is to go to a 70 percent income tax for 
people who make $10 million or more. It takes care of 5 days of 
borrowing.
  Are you starting to get the point here that suggestions keep being 
thrown out and people pretend these are real? They are not. They are 
not.
  The primary driver of our debt between today and 30 years from now--
you are approaching almost $120 trillion of debt 30 years from now. 
Seventy-five percent of that debt is the shortfall of Medicare. Twenty-
five percent is if we take Social Security and backfill it.
  It is demographics. We have 67 million of us who are baby boomers. 
Every day we wait, it gets dramatically more difficult to fix. I have 
an entire side here that cares so much more about winning the next 
election because we have lied to our voters for so long that if we get 
rid of waste and fraud and foreign aid, we will be fine.
  Come on, look at the math. It is not hard math. Download the CBO 
reports. Download one of the Social Security actuary reports. They are 
not that hard to read. Stop making things up.
  Here is the primary driver. I know this makes people upset when I 
show it, but it is the reality. I want to make sure people understand 
this board, the percentage of people age 65 or over relative to the 
prime working age. There is this whole body of economics that basically 
says, people between 25 and 65, those are their prime working years. 
That is their productivity years. When they pay taxes, new family 
formations--and I have done presentations on the collapse of family 
formation, which is just making a mess of our future economically.
  How many are 65 and older as a ratio compared to those who are in 
their prime working age? You have to understand, we are already 
basically here. We are already crossing over to 40 percent of the 
population.
  So, 40 percent will be 65 and older compared to the number of the 
population that is in the prime working age. That is the math. That 
population has earned benefits. We made a societal promise. We promised 
Medicare. We promised Social Security. Now, we have to figure out how 
to pay for it.
  Understand, we are right here. In 2023, we are right now 38 percent. 
Looks like in 2028, in just a couple of years, we cross 40 percent. 
Then, as you start to get another 25 years, you are up to 46 percent of 
the population is 65 and older compared to how many you have in the 
prime working age.
  This is a combination of baby boomers and the fact that fertility 
rates functionally started collapsing in the early 1990s, and we didn't 
want to talk about it.
  Now, I am going to show the couple of boards that enrage people, yet 
the math has been vetted and vetted.
  Board 1, this board now is already a couple of years old. I am just 
too cheap to print another board. It is not $116 trillion of borrowing. 
It is $128 million, almost $130 million. Seventy-five percent of the 
borrowing over the next 30 years, Medicare. Twenty-five percent of the 
borrowing is if we backfill Social Security, plus their interest costs.

                              {time}  2015

  The rest of the budget is calculated to have a positive balance, 
meaning if we hold discretionary for that 30 years, basically, in the 
formula that is already in law today--this is the law as it is today--
just the shortfall in Medicare is somewhere between $80 trillion to $90 
trillion during that 30 years. Yet, I have had townhalls where I have 
asked, ``How many of you would raise your hand if I would just give you 
back every dime you put into Social Security and the dimes you put into 
the Medicare trust fund? Would you take that?'' A bunch of people 
raised their hands.
  We should take that deal as a society because most people don't 
realize what the actual underlying math is. This is for a couple. 
Social Security, you would have made so much more if you had been 
allowed to put some of that money in the market. Let's be honest, AARP, 
the Democrats, and others back when George W. Bush proposed it went to 
war. They crushed the idea. Now, we are 20-some years later and look 
back and go: We were idiots for not actually doing it.
  Your life would be dramatically more secure. Your retirement would be 
dramatically more secure if you hadn't given it to the trolls who 
fought it.
  The basic math on Social Security, this couple will have paid 
$625,000. That is the mean over a 40-plus quarter work life. You are 
going to get back $698,000. What is that? A $72,000 SPIF you get.
  You functionally get your money back from Social Security. It is not 
a great rate of return, but you get it back. However, what people don't 
understand is the primary driver of U.S. sovereign debt is Medicare. 
That couple will have put in about $161,000 into Medicare taxes.
  The Medicare trust fund only pays 38, 40 percent of the Medicare 
bills. The rest comes right out of the general fund. You put in 
$161,000 in your work life--this is for the average couple--and you get 
back $522,000. This number has gone up dramatically because of medical 
inflation. We just haven't had the time to recalculate it. It is this 
differential right here that is the primary driver of U.S. sovereign 
debt.
  I have done this in groups, and I get booed for the math. You get 
booed and go: But it is a calculator. It is math. Are we that terrified 
of the truth?
  Understand, the wheels are coming off already. In the first 7 months 
of this fiscal year, entitlement spending is already up 11 percent. 
That is particularly driven because Medicare costs in the first 7 
months of this year look like they have gone up about 16 percent 
because healthcare inflation really almost doubled the base inflation 
from all the spending the Democrats did when they were in charge. But 
last month's receipts, revenues, started to collapse. Capital gains 
taxes have crashed.
  Now, understand, when we did the calculations last month, 7 months 
into this fiscal year, our costs on entitlements are up 11 percent, and 
our tax revenues are down 10 percent. That is why if you actually pull 
out the Treasury tables and read them and do the math and add them 
together, you are today heading toward a $1.7 trillion borrow. Assuming 
that the rest of the fiscal year is normalized, if it stays on that 
particular path, that number may be a few trillion dollars higher.
  The reason I am talking about this is that we are hitting numbers of 
borrowing we weren't supposed to hit for another decade, decade and a 
half. There is this concept called fragility. Everything is fine and 
wonderful in life and our bonds, and everyone is willing to buy our 
debt until they are not. At that moment, you have that failed bond 
auction, the moment you actually have this starting to happen, where 
receipts are crashing and your costs are going up, the rest of the 
world sees that and says maybe we don't buy U.S. bonds this time.
  The moment you hit that inflection, if U.S. rates for the next 25 
years are 2 points higher than we had over the previous decade, at the 
end of that 25 years, every dime of tax receipts goes just to pay 
interest.
  Do you want to know what default looks like? That is what default 
looks like. It is not the clown show we have around this place where 
people run around pretending their hair is on fire.
  Madam Speaker, I am sorry. I know I was a little agitated. I have had 
far too

[[Page H2419]]

much caffeine. This is important. We need to understand the math.
  Madam Speaker, I yield back the balance of my time.

                          ____________________