[Congressional Record (Bound Edition), Volume 153 (2007), Part 18]
[Senate]
[Pages 25872-25879]
[From the U.S. Government Publishing Office, www.gpo.gov]




           INCREASING THE STATUTORY LIMIT ON THE PUBLIC DEBT

  The PRESIDING OFFICER. Under the previous order, the Senate will 
proceed to the consideration of H.J. Res. 43, which the clerk will 
report.
  The legislative clerk read as follows:

       A joint resolution (H.J. Res. 43) increasing the statutory 
     limit on the public debt.

  The PRESIDING OFFICER. Under the previous order, there will now be 90 
minutes of debate equally divided between the leaders or their 
designees.
  The Senator from Montana.
  Mr. BAUCUS. Mr. President, in the play ``The Taming of the Shrew,'' 
Shakespeare wrote: ``There is small choice in rotten apples.''
  I feel a little like that whenever we have to raise the debt limit. 
It is a small choice in rotten apples. The choices are all bad. Really, 
though, there is no choice.
  The legislation before us would increase the limit on the debt issued 
by the U.S. Government by $850 billion. The House has sent us this 
legislation. Essentially, we have no choice but to approve it. If we 
fail to raise the debt ceiling soon, the U.S. Treasury will default for 
the first time in its history. Plainly, especially in this credit 
crisis, we cannot let that happen. If we don't raise the ceiling before 
Monday, Treasury Secretary Paulson will be forced to take special 
measures to prevent the default from occurring. He feels those actions 
would create uncertainty in the financial markets. He thinks it would 
be unwise to add any uncertainty to the financial markets right now, 
and I agree with that. The markets already have enough uncertainty 
arising from the foreclosures on subprime mortgages. But there is no 
way around this. These are some rotten apples.

[[Page 25873]]

  This increase in the debt ceiling will be the fifth increase during 
this administration. It increased by $450 billion in 2002, it increased 
by $984 billion in 2003, it increased by $800 billion in 2004, and it 
increased by $781 billion in 2006. Today's $850 billion increase in the 
debt ceiling will be the third largest increase in our Nation's 
history. The largest increase was the $984 billion hike in 2003. Once 
today's $850 billion increase is enacted, the fourth largest rise will 
have been the $800 billion in 2004. The fifth largest increase will 
have been the $781 billion hike in 2006.
  There is no way around it. This is a poor fiscal record. When you add 
today's $850 billion increase to the previous increases since 2001, the 
debt ceiling will have increased by almost $4 trillion during this 
administration. The debt ceiling will have increased from about $6 
trillion at the beginning of this administration to about $10 trillion 
now--$6 trillion at the beginning of this administration, the debt 
ceiling, will be increased now to about $10 trillion. That is a two-
thirds increase in the debt ceiling in 7 years.
  Unfortunately, for us today, there is little choice at this moment 
right now. There are other choices we should be making in this Congress 
and in this country with respect to our fiscal situation, but today, at 
this moment, with respect to the debt ceiling, there is little choice. 
The Government has already borrowed the money that has caused its debt 
to reach the current ceiling. It has already been borrowed. To keep the 
Government running, the Treasury now needs to borrow more money. The 
Treasury cannot do that unless we raise the debt ceiling.
  Why is it unfortunate the Government has gone into so much debt? The 
answer is it lowers the standard of living for future generations of 
Americans. That is hardly the legacy we should want to leave for our 
children and grandchildren.
  If the U.S. Government borrows money, it competes for funds from the 
global financial markets. Unless Americans begin to save more, these 
funds will come from foreign lenders. As a result, we will owe 
foreigners interest on those funds in future years. Because Americans 
will have to pay that interest to foreigners, we will have less money 
to spend on goods and services, and the standard of living for 
Americans in the future will be lower than it otherwise would be.
  It is happening already. It is happening because the dollar is 
declining. It is declining quite precipitously. Why is the dollar 
declining? Probably because our fiscal policy has not been very sound. 
We have been borrowing so many dollars from overseas. Our current 
account deficit is so large. We have been consuming at such rapid rates 
that, finally, the chickens are beginning to come home to roost. The 
dollar is starting to decline, and it is making it very difficult now 
for Americans, on the margin, to live at the same living standard.
  With the dollar declining--and, again, it is declining because 
foreign investors are starting to think maybe it is wiser to invest 
their dollars, on the margin, elsewhere--when the dollar declines, that 
means imports are more expensive and consumers have to pay more than 
they currently have been paying for those same products. It means 
American companies are now able to raise their prices to the levels of 
the more expensive foreign imports. It means, frankly, that average 
Americans are facing more costs for the same goods.
  On the other hand, the most wealthy people in America can invest in 
foreign currency and take advantage of the dollar. But the average 
American cannot do so. So what we are doing today, with our very high 
debt, is essentially lowering our living standards.
  Further, the amount of U.S. Government debt held by foreigners is 
troubling. As of December, 2006, foreigners held an enormous $2.2 
trillion of debt issued by the U.S. Government. For example, Japan held 
$644 billion of U.S. debt, and mainland China held $350 billion.
  I might add that a lot of these foreigners are starting to change 
their investment patterns. They are developing sovereign wealth funds. 
They are diverting some of their currency holdings. China is a good 
example. They are not just buying U.S. Treasury notes, bills and bonds, 
they are starting to do more direct investing around the world. That 
too is starting to have, on the margin, a slightly negative effect on 
the dollar.
  In December, 2001, foreigners held a total of $1 trillion in U.S. 
debt. Thus, foreign-held debt has increased from $1 trillion at that 
time, December 2001, to about $2.2 trillion in December, 2006. That is 
a 120-percent increase since 2001. Over time, the cumulative interest 
payments on these holdings will be very large.
  The significant foreign holdings of U.S. debt create two more serious 
problems. The first problem relates to a falling dollar, as I have 
mentioned. If the dollar falls, the value to foreign holders of U.S.-
issued securities falls. If the dollar continues to fall, at some 
point, foreigners may become scared of further drops. To protect 
themselves, they may sell their holdings of U.S.-issued securities. And 
a large sell-off could happen precipitously and cause interest rates in 
the United States to rise immediately. A recession would likely follow.
  I am not saying that is going to happen, but I am saying the 
probability of that happening is getting greater and greater and 
greater with the passage of each day.
  Today, the dollar is at another all-time low against the Euro, and 
the Canadian dollar has reached parity with the U.S. dollar for the 
first time since the 1970s. If the dollar continues to fall, we could 
see foreigners selling off U.S.-issued securities at some point.
  The second problem concerns our national security. Currently, almost 
60 percent of U.S. debt held by foreigners is in the hands of foreign 
central banks or other official foreign government institutions. That 
amounts to about $1.3 trillion--clearly, an enormous figure.
  So what happens if we get into a trade dispute with one of these 
countries, or a military or diplomatic dispute? The government of one 
of these countries could prevail upon its official institutions to 
threaten to sell off some or all of its holdings of U.S.-issued debt. 
If such an action occurred, it would drive up interest rates in the 
United States and cause a recession. The threat of such action would 
give the foreign country significant leverage in its trade or military 
or diplomatic dispute with the United States, which would be very 
unfortunate.
  Again, I am not saying it is going to happen right away, or it is 
going to happen at all. But I am saying, given the deterioration of our 
fiscal situation, it is, on the margin, slowly, inevitably, irrevocably 
giving these other countries more leverage over us in any policy 
dispute they may have with us.
  The revenue and spending laws that have helped to create the need for 
this huge jump in the debt ceiling were enacted some time ago. We piled 
up huge budget deficits in recent years by not having enough revenues 
to pay for our spending. So the Treasury had no alternative but to 
borrow funds to make up the difference, because we, obviously, had been 
spending more than we were taking in. The Treasury, therefore, had to 
borrow. And that is the problem; it is the added borrowing year after 
year after year after year in the amounts I have already indicated.
  The responsible thing to do right now is to raise the debt ceiling 
because we have to. This debt ceiling is similar to a credit card. The 
bill is due. You have to pay what is on the credit card. But the goal 
is to make sure there aren't future increases in that credit card bill. 
We have to pay what the credit card bill is. That is the legal 
obligation. So there is no choice, and it is the responsible thing to 
do. But it is also the responsible thing to do to reduce the need to 
raise the debt ceiling again in the future.
  We need to stop running annual deficits in our Federal budget. We 
need to stop cutting taxes when we cannot afford to do so. We need to 
stop increasing spending when we cannot afford to do so. It is easy 
around here to cut taxes, it is easy around here to raise spending. 
Fortunately, we have these pay-go rules now which makes it that

[[Page 25874]]

much more difficult to do, and we have to basically heed the basic 
principles behind pay-go.
  The beginning of the retirement of the baby boom generation next year 
will create needs for even more spending. Our ability to achieve 
balanced budgets will become more difficult. Nonetheless, we ought to 
balance the budget. It is the right thing to do. It would send the 
right signals in so many ways all across the country and around the 
world that we are getting our act together and living within our means. 
It is such a powerful force, in my judgment. We have to do it, 
otherwise we are going to keep piling up more and more debt and the 
dollar is going to potentially continue to fall, and living standards 
will continue to fall for Americans. So let us raise the debt ceiling 
now because we have no choice. But let us also work together to balance 
the budget in years to come. That is the only way we can keep from 
having to enact more increases in the debt limit in the future. When it 
comes to that burden as well, there is no choice either.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, the current law is that we have a 
statutory limit on the amount of money the Federal Government can 
borrow, and that has to be reconsidered from time to time. The legal 
limit applies to the money borrowed from individuals, private 
investors--such as banks and pension funds--as well as money borrowed 
from other governmental programs that are in surplus--such as Social 
Security and Medicare, or what we call intergovernmental borrowing.
  Increasing the debt limit is necessary to preserve the full faith and 
credit of the United States of America. Without an increase in this 
limit, our Government will face a choice between breaking the law by 
exceeding the legal limit or breaking faith with the investors by 
defaulting on debt. Neither of those choices is acceptable, and we have 
never done them.
  Critics sometimes object to raising the debt limit on grounds that it 
will allow the Government to borrow more money, but refusing to raise 
the debt limit is akin to refusing to pay your individual credit card 
bill after you have already gone shopping and bought something. We 
cannot pass tax bills and spending bills and then refuse to pay our 
bills. The time to control the debt is when we are voting on bills that 
actually create that debt.
  Raising the debt limit is about meeting the obligations we have 
already incurred, it is that simple. We must meet our obligations. So I 
urge my colleagues to support this increase.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. Mr. President, the Senate is now considering a measure to 
further increase the Federal debt limit. This is further confirmation 
of the Bush administration's failed fiscal record. It represents now 
the fifth time the President has come to Congress asking for more debt.
  We all know we have no choice in this matter. These are debts that 
have already been accrued. The question before us is: Do we pay the 
bills of the United States or do we fail to do so? If we failed to 
cover our borrowing, if we failed to pay the bill, the creditworthiness 
of the United States would be called into question and there would be a 
run on the dollar. There would be economic chaos. So we have no choice, 
and I hope that colleagues on both sides will take up this 
responsibility.
  We all remember that when the Bush administration came into office, 
the President said this:

       My budget pays down a record amount of national debt. We 
     will pay off $2 trillion of debt over the next decade. That 
     will be the largest debt reduction of any country, ever. 
     Future generations shouldn't be forced to pay back money that 
     we have borrowed. We owe this kind of responsibility to our 
     children and grandchildren.

  That is what the President told us then.
  We are now able to look at the record. What we see is quite different 
from what he asserted then. Instead of paying down the debt, the debt 
has exploded on his watch. Here are the increases in the debt that have 
been enacted and requested by this President.
  First of all, perhaps it is instructive to go back to the period 1998 
to 2001, during the previous administration, when there were no 
increases in the debt. In fact, we were paying down the debt. Then, in 
2002, this President asked for and got a $450 billion increase in the 
debt limit; followed in 2003 by the largest increase ever, $984 
billion; followed by $800 billion in 2004, $781 billion in 2006, and 
now, this year, another $850 billion. This is the debt President. The 
debt limit of the United States will have been increased, under his 
direction, by almost $4 trillion.
  This chart shows the dramatic deterioration in the budget picture 
under the fiscal policies of this President. We were in surplus. In 
fact, we had even stopped, under the previous administration, taking 
Social Security funds to pay other bills. Under this administration, 
the deficit skyrocketed and the debt has grown geometrically.
  Despite all the assertions of fiscal responsibility, this President 
has increased Federal spending from $1.9 trillion to $2.7 trillion a 
year, an increase of nearly 50 percent.
  On the war alone--and this puts in perspective the war costs--you 
will recall the President told us that the war would cost $50 billion. 
We are at $567 billion and counting. Now we hear of a request for 
another $42 billion on top of the $147 billion that was allocated this 
year.
  President Bush has indicated and his administration has told us that 
we should expect a ``Korea-like'' presence in Iraq. Here is what this 
would mean, according to the Congressional Budget Office. So far, the 
war in Iraq and Afghanistan has cost $567 billion. CBO tells us a 
``Korea-like'' presence would mean an additional $1 trillion in the 
period 2009 to 2017, and from 2018 to 2057, another $1 trillion, for an 
addition of $2 trillion to the $567 billion already committed. So the 
war that was supposed to cost $50 billion is now headed for $2.5 
trillion, if we maintain a ``Korea-like'' presence, as called for by 
the President.
  On the revenue side of the equation, where we hear so much from our 
colleagues about the dramatic improvement in revenue, what you will 
notice in all of their charts is they just look at the last couple of 
years. They don't look back to when this administration started. But 
what you see is real revenues, adjusted for inflation, were $2.03 
trillion back in 2000. This year, real revenues are $2.13 trillion. 
Revenue has been basically stagnant in this country for 6 years.
  So when you dramatically increase spending and revenue is stagnant, 
guess what happens. The debt soars. That is precisely what has happened 
under this President--from $5.8 trillion in 2001 to a now anticipated 
$8.9 trillion at the end of this year. This President has run up the 
debt in a record way. He truly will claim the mantle and the legacy as 
the debt President.
  Not only has he dramatically run up our debt domestically, he has 
also dramatically increased foreign holdings of our U.S. debt. When he 
came into office, there was just over $1 trillion of U.S. debt held 
abroad. In other words, it took 42 Presidents 224 years to run up $1 
trillion of U.S. debt held externally. This President has more than 
doubled that amount in just 6 years, to almost $2.2 trillion. The 
result of all of that is we now owe Japan over $600 billion, we owe 
China over $400 billion, we owe the United Kingdom over $200 billion, 
we owe the ``oil exporters'' over $100 billion, and on and on it goes. 
We are now truly in need of the kindness of foreigners because if they 
do not float this boat, if they don't provide the financing for this 
debt, the United States would be in even deeper trouble. Can you 
imagine if all of a sudden the Chinese, the Japanese, the British, and 
the rest decided not to extend us additional credit, additional loans? 
The interest rates in this country would jump. It would put us into a 
recession, and we would be in deep trouble. So we are in debt and we 
are beholden and we are dependent on the kindness of strangers.
  Here is what the head of the Federal Reserve has warned us on the 
danger of

[[Page 25875]]

growing debt. He said this before the Senate Budget Committee on 
January 18:

       Ultimately this expansion of debt would spark a fiscal 
     crisis which could be addressed only by very sharp spending 
     cuts or tax increases or both . . . [T]he effects on the U.S. 
     economy would be severe. High rates of government borrowing 
     would drain funds away from private capital formation, and 
     thus slow the growth of real incomes and living standards 
     over time.

  The recklessness of this administration in managing the fiscal 
affairs of this Nation is clear and compelling. It could not be more 
apparent.
  Tonight is one more confirmation of the disastrous consequences of 
the fiscal policy of this President. He is the debt President. With the 
action that will be required to be taken tonight, he will have added 
nearly $4 trillion to the debt position of our Nation. That is a sad 
legacy, and future generations are going to pay an enormous price for 
this profligacy--spending without a willingness to pay for it, simply 
putting it on the charge card, shoving the debt off to future 
generations, and all the time claiming to be fiscally responsible.
  The actions of Congress tonight, responding to the request of the 
President to once again expand the debt limit by hundreds of billions 
of dollars--in fact, tonight, by $850 billion in one fell swoop--should 
tell us all we must have a new direction for the fiscal course of this 
country.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. COBURN. 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. COBURN. Mr. President, this evening we have a choice to make that 
is a true reflection of whether this body has been listening to the 
American public. We are about to increase the amount of money we can 
borrow against our children's future by $850 billion. That is almost $1 
trillion. What does that say about us? That we can't do what we ask 
every other American family to do, which is live within our means. It 
is not about parties. Both parties are guilty. But it is about 
priorities, and it is about choices.
  Many of us know that our approval rating is at an alltime low--11 
percent. We have a chance tonight to change that. We have a chance 
tonight to raise that. We have a chance tonight to prove to the 
American people that we are listening.
  A new Gallup Poll put it this way:

       Americans now express less trust in the Federal Government 
     than at any time in the past decade and trust in many Federal 
     Government institutions is now lower than it was during the 
     Watergate era, generally recognized as the low point in 
     American history for trust in the Federal Government.

  Think about that. How is it that we got ourselves to that position? 
How did we slip to a level below the Watergate era?
  Mr. SANDERS. Will my friend yield?
  Mr. COBURN. I would like to finish my statement, and then I am be 
happy to yield to the Senator from Vermont.
  One reason is Americans believe we are totally out of touch with the 
realities they live with every day in terms of budgeting and spending. 
What I often hear in this body, both by statement and by action, is 
that we really do not have to choose between two priorities because we 
can do both. The American people can't do both, but we can do both. How 
can we do both? What we do is we ignore the choices we have and lay our 
responsibility on generations to come. That is how we do both. We do 
not do what is required of us in terms of oversight, eliminating fraud, 
eliminating duplicative programs, eliminating programs that do not 
work, that have no metrics. That, by the way, comes to $200 billion 
worth of fraud, waste, and abuse which has been documented, every year, 
that we spend, that we are not working on, we are not trying to 
eliminate. But what we are about to do, because we failed to do that, 
we are about to increase the amount which our children and 
grandchildren are going to have to repay.
  The problem is there is nobody outside this body who thinks that 
way--only inside. In the real world, people have budgets they have to 
live within. Their choices have consequences, and we choose to make the 
consequences happen to our children and grandchildren rather than 
accept the consequences. What has made this country great has been the 
heritage of sacrifice we have seen by multiple generations that have 
come before us. We are now denying that heritage, as we in this body 
refuse to accept the responsibility placed on us to make hard choices.
  Tonight, we are going to have a vote and we are going to raise the 
debt limit and we are going to really say: Children, we don't have the 
courage to do what we need to do, whether it is raise taxes or cut 
spending or both. We don't have the courage to do that. But we are 
cowardly enough to shift it off onto you.
  That is what it really is. We don't want to go against interest 
groups that are invested in something that isn't working. We don't want 
to eliminate the $53 billion a year that is estimated to be fraud in 
Medicare and Medicaid. We don't want to do anything with the excess 
41,000 properties the Federal Government owns that cost us $18 billion 
a year but we won't do anything with them. We will not do what is 
necessary and sacrifice so that we can secure the future.
  We are going to raise the debt limit because both parties, mine and 
the leadership party, have refused to restrain spending.
  This will be the sixth time since 1997 that the debt limit has been 
raised. At the same time, earmark spending has skyrocketed. It is over 
half a trillion dollars in the last 10 years. There are no competitive 
bids on earmarks, no accountability, no followup, just gifts. Some are 
great priorities, but there is no system of economic controls.
  My own party did a lot to create this mess. In 2005, 82 of my 
colleagues said building a bridge in Alaska was more important than 
repairing the bridges in Louisiana.
  We said that. This body said that. Last week I asked my colleagues to 
make a number of choices. I offered an amendment that said until we fix 
our at-risk bridges and our high-risk highways that will account for 
13,000 deaths a year, we ought to delay earmarks until we make that a 
priority. We lost that vote 82 to 14.
  I offered an amendment to prohibit funding on bike paths and horse 
trails until we have done the same thing. We lost that amendment 80 to 
18. I also attempted to strike funding for a peace garden, construction 
of a new baseball stadium, and a visitor's center, bipartisan 
amendments. We chose to say, no, we can do that rather than build and 
restore our highways and bridges.
  What is as bad as the choices we make are the choices we ignore. And 
that is the very real need to do extremely heavyhanded oversight on the 
waste, fraud, and abuse that occurs every day within the Government 
that we supposedly have our hands on.
  I know we could cut discretionary spending by at least 10 percent. 
Okay? That is $100 billion a year if we got together and said we are 
going to work on these programs together. But we are not going to do 
that. What we are going to do is keep pointing fingers at one another 
rather than at ourselves and raise the debt limit.
  We are not going to do that hard work. I believe the American people 
are sick of it. Families across America do not have the luxury of 
loaning themselves new money when they have maxed out their credit. But 
that is what we are going to do. There is no credit limit for us. One 
is coming. It is coming as we have seen the price of the dollar fall 
recently. We will certainly see it fall further in the future. There is 
going to be a cost.
  What this vote means is, instead of using this year's appropriations 
cycle to trim waste, to decrease spending, reduce the national debt, 
all we have done is made the problem worse.
  First, we have not passed any bills through Congress. The bills that 
are in conference, with the exception of one, are at 5 to 6 to 7 
percent above last year's spending level. So we have admitted we cannot 
do it. Only weeks after passing a brandnew ethics law,

[[Page 25876]]

the Senate has now decided it is okay to add new earmarks in 
authorizing bills. We have also decided that instead of making sure we 
know the identity of earmarks, how much money it is, what is it going 
for, and who is going to get it, we only say: I am offering it, and I 
do not have any pecuniary interest in it. What we told the American 
people was a sham. We are not doing what we said we were going to do.
  Instead of spending our time trying to figure out how to continue to 
raid the Federal Treasury without getting caught, I believe we ought to 
be doing our job. Congress should pass individual appropriations bills 
at a level less than last year, with the waste, the fraud, abuse, and 
duplication out of them. But we are not going to do that.
  The vote on the debt limit gives Congress another opportunity to 
demonstrate to the American public that we do have the courage and the 
ability to fix what is wrong with this ship. By voting for this debt 
limit, what you are telling the American people is, you do not have the 
courage to fix what is wrong here. We do not have the courage to do the 
oversight that is necessary.
  Whether it is the $40 billion worth of waste, at least, a year in the 
Pentagon, or the $43 billion a year wasted on Medicare and Medicaid 
through fraud, or the $18 billion we are spending on buildings that we 
do not want, we do not have the courage to do that.
  What we should be doing is tearing up the credit card and, through 
not passing an expansion or extension of the debt limit, start acting 
like every other American family has to do and start making the hard 
choices even if it offends some of our constituents, because the 
constituents who matter the most, as we continue the heritage of this 
country of creating opportunity, are our children and grandchildren.
  My real hope is this debt limit expansion does not pass tonight, that 
we all get to reflect on that; we come together, Democrat and 
Republican, and say: We have not done a good job. Let's make a pact 
that we are going to do the oversight, that we are going to cut the 
programs, that we are going to lower spending. It does not matter what 
President Bush wanted. We have the power of the purse. We can decrease 
spending.
  Will we do that? Unfortunately, my belief is we will not because, 
quite frankly, we are interested in the next election more than we are 
interested in the next generation, and to that, shame on us.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Sanders.) The Senator from North Dakota.
  Mr. DORGAN. Mr. President, let me make a couple of comments. I will 
not take a long time.
  I have to observe that there was a time when there was substantial 
courage in this Chamber. I recall we had some very large budget 
deficits growing over a long period of time, and we passed a new fiscal 
policy. I was here then some long while ago. It passed by one vote in 
the Senate and one vote in the House. That took some courage. Some 
people who cast those votes did not come back here, because they were 
very controversial votes.
  But we turned our fiscal policy around in this country by making 
tough choices. We turned the Federal budget deficit into a Federal 
budget surplus and began paying down the Federal debt. In 2001, on this 
floor, in this Chamber, we had a debate about fiscal policy again. A 
new President came to the White House. President Bush said he was a 
conservative.
  He said: Well, now, we have all of these surpluses. He and his 
friend, Alan Greenspan, were worried that the biggest problem facing 
America was that we were going to pay down our debt too rapidly. The 
President and the White House said: We have got all of these surpluses. 
Let's decide to give the wealthiest Americans some large tax cuts 
because I believe in trickledown economics. Put a lot in the top, and 
see if some will drain down a bit.
  Some of us stood on the floor of the Senate and said, you know what, 
we have just finally turned this economy around, turned these huge 
budget deficits around. The plan under the Clinton administration 
worked, and we turned big deficits into big surpluses and began to pay 
down the Federal indebtedness.
  Some of us stood on the floor of the Senate and said: Mr. President--
to President Bush--maybe we ought to be a bit conservative. What if 
something happens? These big surpluses for the next 10 years do not yet 
exist. Yes, there is a surplus now, but we do not have a 10-year 
surplus that exists. That is the projection. What if something happens? 
Why do we not be a bit more conservative in how we deal with this?
  The President and his supporters said: No. No. No. What we are going 
to do is we are going to give very large tax cuts to the wealthiest 
Americans. We want to do it right now. They won. They had the votes to 
win, and they turned this economy around, all right. They turned budget 
surpluses, in a period where we were actually paying down the Federal 
debt, into some of the largest Federal deficits in this country's 
history--once again, unbelievable.
  So when I hear people talking about courage, let me say we had some 
courage on the floor of the Senate. I am proud to have been one of them 
who cast a vote that passed by one vote, that turned around this 
country's fiscal policy. And now we leave an example of a fiscal policy 
that was reckless, one of the most reckless fiscal policies I can ever 
imagine, given to us in 2001 by a new President who said he was 
conservative but who was not.
  In fact, my colleague just described what we are spending and not 
paying for. Yesterday in the Senate Appropriations Committee, President 
Bush sent his Defense Secretary, he sent the Assistant Secretary of 
State, he sent the Chairman of the Joint Chiefs of Staff, to ask us for 
another $189 billion to prosecute the war in Iraq and Afghanistan. And, 
oh, by the way, the President said: I do not intend that we pay for any 
of that; put that right on top of the debt. We are going to charge it 
all.
  That is the direction this White House is leading. That is what 
brings us to the floor of the Senate tonight, with a fiscal policy that 
has rung up an enormous amount of additional debt; the worst possible 
fiscal policy you can imagine.
  You know what happened? Some of us said, maybe we ought to be a 
little bit conservative, a little bit careful. The President said: No. 
No. No. We are not going to do that. We are going to take these 10 
years of estimated surpluses and we are going to spend them with tax 
cuts.
  Here is what happened very quickly. We were in a recession. The 
President likes to say he inherited the recession. He did not. But very 
shortly after he took office, we experienced a recession. Then we 
experienced the terrorist attack of 9/11, and then a war in 
Afghanistan, then a war in Iraq, then an economic slowdown.
  Would not it have been smarter to have a fiscal policy that was a bit 
more careful, one that would have given a bit more thought about how to 
best care for this country's finances? I know it is easy to blame. I 
watched today as we had people come to the floor of the Senate blaming 
this, that, and the other thing. It is easy to take the negative. I 
understand that. Mark Twain was once asked if he would engage in a 
debate. And he said: Oh, sure, as long as I can take the negative side. 
Somebody said: We have not told you the subject. He said: Doesn't 
matter. If I take the negative side, it will take no preparation.
  So I understand those who come to the floor of the Senate and tell us 
what is wrong. But I can tell you about a fiscal policy that was right, 
because I supported it and am proud to have done it some years ago, 
that turned big deficits into budget surpluses and began paying down 
the Federal debt. That is the kind of fiscal policy we need. It is the 
kind of fiscal policy we had, and this administration and those who 
supported it in this Chamber turned their back on it 6 years ago. Now 
we have paid the price for those votes.
  I hope those who describe these issues remember, remember what a good 
fiscal policy was and how to recapture it once again. Yes, it take a 
little political courage. Those of us

[[Page 25877]]

who supported a fiscal policy that works understand how it worked when 
it happened.
  We have a lot to be thankful for, living in this great country of 
ours; only one spot like it on the planet. We have responsibilities 
that are very significant here in this Chamber. There is plenty wrong 
with this country, plenty of things that need fixing. But it is a 
wonderful place that requires our stewardship to do the right thing. I 
only came to the floor as I listened this evening to point out that we 
have seen good fiscal policy and bad fiscal policy. I, and I think many 
others, recognize the difference. If all of my colleagues will 
recognize that difference, we can put this country back on track once 
again. That is what the American people deserve and expect from us.
  I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. BAUCUS. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. REID. Mr. President, before I discuss this legislation, I want to 
express my thanks to the distinguished minority leader, Senator 
McConnell, as well as the chairman and ranking member of the Finance 
Committee, Senators Baucus and Grassley, for their cooperation in 
facilitating consideration of this legislation. I also want to thank 
Treasury Secretary Paulson for his leadership.
  We are taking up this legislation at the request of the Bush 
administration so that the Federal Government can meet its obligations 
and pay its bills. Secretary Paulson, in a letter to me earlier this 
month, indicated that it was essential that the Senate pass this 
legislation as soon as possible. This will be the fifth increase in the 
debt limit since President Bush came to office.
  I find it distasteful and disturbing to increase the debt limit yet 
again, but the alternative is simply unthinkable. Eventually, some 
Social Security checks could not be sent. Government offices could 
close. Interest rates could rise. And the economic impact on our 
country could be profound. As a practical matter, therefore, we have no 
choice.
  Having said that, President Bush's failed policies put us in this 
box, and as we consider the pending bill, I hope my colleagues will 
focus on the importance of changing those policies. Over the past 
several years, the administration has completely abandoned fiscal 
discipline and dramatically increased our debt. Until we change the 
policies that led down this path, we will be back year after year, 
digging the hole ever deeper.
  Let's review some history. When President Bush came to office, our 
Nation was running record budget surpluses and our debt was on the 
decline. In 2000, we ran a surplus of $236 billion, and the outlook was 
for continued surpluses for years to come. In fact, the Chairman of the 
Federal Reserve at the time, Alan Greenspan, was so optimistic about 
our fiscal condition that he thought we might quickly eliminate our 
debt altogether.
  Unfortunately, once President Bush took office, our fiscal situation 
rapidly collapsed. In 2001, our debt was $5.8 trillion. Today, it's $9 
trillion, an increase of more than $3 trillion. Compounding matters, 
all this new borrowing has come at the worst possible time, just as the 
baby boom generation is about to retire.
  Not only has our debt exploded, but increasingly we are borrowing 
from foreigners. In fact, since President Bush took office, our debt to 
foreigners has more than doubled. Many of our creditors are in places 
like China and Japan. And as we borrow more and more from those abroad, 
we also become more dependent on them. It is a trend that cannot and 
must not be allowed to continue.
  It's no mystery why debt has exploded. President Bush abandoned the 
pay-as-you-go rules that proved so effective in promoting fiscal 
discipline. He increased spending by 50 percent. And he approved 
massive tax breaks, disproportionately for multimillionaires and 
special interests.
  Much of the spending has been for our disastrous occupation of Iraq. 
The war has already cost the lives of almost 4,000 Americans. But while 
our brave men and women in uniform bear, by far, the greatest burden, 
all American taxpayers are paying a price. We have already spent 
roughly half a trillion dollars on President Bush's failed policy. Now 
the President is asking for nearly $200 billion more.
  How does the President propose to pay for all this new spending in 
Iraq? He doesn't. He just wants to keep putting it on the national 
credit card.
  The same is true of the President's massive tax breaks for 
multimillionaires. Next year, President Bush wants to spend nearly $50 
billion just to hand out tax breaks for those fortunate enough to earn 
more than $1 million a year. These lucky few will get a windfall worth 
an average of $130,000 each. Most hard-working, middle-class families 
would be grateful for a fraction of that.
  And how will we finance all these lavish tax breaks for 
multimillionaires? Again, by putting them on the national credit card. 
In other words, our children will pay.
  If only the President were as willing to provide kids with health 
care as he is willing to load them with debt.
  As you know, the administration claims to have seen the light on 
fiscal responsibility, and has cited the need for discipline to justify 
their opposition to the children's health bill. But how much would the 
legislation add to the debt? $200 billion? $20 billion? No. The answer 
is: zero. Nothing. It is fully paid for.
  In other words, the President is willing to borrow half a trillion 
dollars and more for Iraq. But he is opposing a children's health bill 
that won't add anything to the debt.
  To put it mildly, those priorities are wrong. The American people 
know it. And most of my colleagues do, as well.
  Clearly, we need to change course. And this debt limit bill is just 
another reminder of that.
  Fortunately, the new Congress already has made real progress in the 
effort to provide a new direction. Earlier this year, we passed a 
budget resolution that balanced the budget without raising a penny of 
taxes. The budget put the middle class first and focused on America's 
needs here at home. All in a responsible way, while reestablishing 
strong pay-as-you-go rules to enforce fiscal discipline.
  Our new budget was an important first step. But we have a long way to 
go to change fiscal policy to where it needs to be. Ultimately, it is 
going to take bipartisan effort, and I look forward to working with 
colleagues on both sides of the aisle to make it happen. Meanwhile, 
while it is not a pleasant task, we have no choice but to pay our 
bills.
  Mrs. FEINSTEIN. Mr. President, I rise today to express my 
disappointment for having to vote yet again to increase the national 
debt limit. The Senate has been forced to take this vote on five 
occasions under this administration. In the intervening 6 years, the 
national debt has exploded by almost $3.4 trillion, or 61 percent.
  The national debt now stands at $9 trillion.
  To put this in terms that most of us can understand, this amounts to 
roughly $30,000 owed by every American.
  Unfortunately, the debt forecast shows no signs of improving.
  Over the next 5 years, the debt is projected to reach $11.3 trillion. 
By 2017, the Congressional Budget Office projects this figure will 
hover around $13 trillion. In this year alone, our national debt is 
slated to increase by almost $600 billion.
  Maintaining this debt is not free. The interest charged on the amount 
we have borrowed grows each and every day. And, the more we borrow, the 
more we pay in interest.
   Over the next 10 years, the interest payments on the national debt 
are projected to total $2.8 trillion. This year, interest payments on 
the debt will reach $235 billion.
  This means less money for the programs that matter most for working 
Americans.

[[Page 25878]]

  Congressional Democrats have demonstrated a commitment to fiscal 
responsibility by passing pay-as-you-go budget rules that require 
Congress to offset new spending.
  This Congress has worked to find ways to pay for major priorities--
such as the extension of the Children's Health Insurance Program, which 
I hope will pass today in the Senate with a bipartisan, veto-proof 
majority.
  The fact that the Senate must vote, yet again, to increase the 
national borrowing limit begs the question: Why are we here?
  Misguided tax policies are one of the reasons we are considering this 
measure today.
  The President has presided over the greatest fiscal reversal in our 
Nation's history. He inherited a budget surplus of $236 billion from 
President Clinton, the largest surplus in American history.
  He took that surplus and sunk it into expensive tax cuts at a cost of 
more than $1.3 trillion to date and $3 trillion over the next decade.
  But what I find most frustrating, is that these tax cuts have come in 
the midst of significant military campaigns in Iraq and Afghanistan.
  Never in the history of this Nation have we enacted significant tax 
cuts during a time of war.
  We have dipped into the pockets of our children and grandchildren and 
``charged'' the costs of these wars to a National credit card.
  When you combine the cost of the debt-financed tax cuts with spending 
for the military operations in Afghanistan, Iraq, and the global war on 
terror--currently approaching $610 billion--the inevitable result is 
that our Federal budget is squeezed, while our crushing debt continues 
to grow.
  The reality is, even under a best-case scenario, we are years and 
hundreds of billions of dollars away from a full redeployment of 
American troops from Iraq.
  The President will soon request another $190 billion in supplemental 
funding for operations in Iraq and Afghanistan. And it is no longer 
unrealistic to suggest that operations there might cost upwards of $1 
trillion before all is said and done.
  Year after year, supplemental after supplemental, we continue 
borrowing to pay for these wars.
  In real terms, the cost is over $350 million per day. Almost $15 
million per hour; $250,000 per minute; or $4,000 every second.
  We must recognize the mistakes of the past few years and understand 
that you cannot have your cake and eat it too.
  As we approach a $10 trillion debt limit, it is essential to look 
forward for solutions. Where do we go from here?
  We start with responsible spending. While I support targeted tax cuts 
to help working families, it is time to allow the tax cuts for the 
wealthiest Americans to expire.
  It would be unfair and irresponsible to not do so.
  We need solutions to shore up our strained entitlement programs, such 
as Social Security and Medicare, as the retirement of baby boomers 
looms.
  We need to adequately fund children's health and education programs 
and invest in the future of our young people.
  We need to focus on foreign diplomacy to repair our reputation as a 
global leader.
  We need to invest in homeland security and other domestic programs 
that will keep America safe and increase productivity.
  Most importantly, we need to start planning for the future today.
  Every day that we wait, hundreds of millions of dollars are spent, 
the debt increases, vital programs are under funded, and the cycle 
continues. We must do better.
  I understand the political realities of this vote.
  However, it is important to recognize the consequences of this 
measure failing. Not increasing the debt limit could result in the 
government defaulting on its obligations, exacerbating already shaky 
credit markets across the globe.
  So while I urge my colleagues to join me in supporting the measure to 
once again raise the debt limit, it is also my hope that my colleagues 
will join me in seeking real and permanent solutions to our Nation's 
fiscal problems.
  Tax cuts, ``staying the course,'' and not addressing the future of 
our most critical entitlement programs are sometimes politically 
appealing policies, but they are also not responsible.
  Responsible policies come from making the difficult choices that put 
America's future first.
  This Congress must exhibit leadership in breaking with the traditions 
of the last few years to put our Nation's fiscal house in order.
  Mr. FEINGOLD. Mr. President, today we are again forced to consider 
legislation to raise the Nation's debt limit. It is obvious to anyone 
that we are here because of the grossly reckless fiscal policies that 
have been advanced by the administration and Congress for nearly 6 
years.
  Over those 6 years we have seen a dramatic deterioration in the 
Government's ability to perform one of its most fundamental jobs--
balancing the Nation's fiscal books. In January of 2001, the 
Congressional Budget Office projected that in the 10 years thereafter, 
the Government would run a unified budget surplus of more than $5 
trillion. Nearly 6 years later, we are staring at almost a mirror image 
of that 10-year, $5 trillion surplus, except that instead of healthy 
surpluses, under any reasonable set of assumptions, we are now facing 
immense deficits and mounting debt.
  We absolutely cannot afford to continue to run up these massive 
deficits. Doing so causes the Government to use the surpluses of the 
Social Security trust fund for other Government purposes rather than to 
pay down the debt and help our Nation prepare for the coming retirement 
of the baby boom generation. Every dollar we add to the Federal debt is 
another dollar that we are forcing our children to pay back in higher 
taxes or fewer Government benefits.
  But inside this dark cloud of dismal fiscal news there is a silver 
lining; namely, the restoration of the so-called ``pay-as-you-go'' 
budget rule, known as pay-go, as part of the budget resolution we 
adopted this year. That rule was central to the ability of the Congress 
to balance the Federal budget in the 1990s, and the return of that 
commonsense discipline gives us a better chance to clean up the fiscal 
disaster the current administration created. Unlike the last time 
Congress had to raise the debt limit for this administration, we now 
have pay-go back in place.
  In some ways, today's vote to raise the debt limit ratifies the 
actions taken by the administration and Congress to stick future 
generations with an immense credit card bill. Had we not restored the 
pay-go rule recently, I may well have decided not to support this 
measure.
  Fortunately, pay-go has been reinstated, and we will be better able 
to return to the path of fiscal responsibility we abandoned a few years 
ago. And because of that, I will support this measure, made necessary 
by the profligate policies of President Bush, and egregiously aided and 
abetted by the last three Congresses.
  Mr. BAUCUS. Mr. President, all time for debate on the debt limit has 
been utilized. In the interest of giving Senators some notice to get 
here in time for a vote, I alert all Senators that we will probably 
begin the vote first on the children's health insurance bill and, 
following that, the debt limit. That will begin sometime between 7:20 
and 7:25. So within about 5 minutes we will begin voting on the 
children's health insurance plan.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. REID. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                 Unanimous Consent Agreement--H.R. 1585

  Mr. REID. Mr. President, I ask unanimous consent that upon 
disposition of H.J. Res. 52, the Senate resume consideration of H.R. 
1585 and resume amendment No. 2999; that the amendment be

[[Page 25879]]

modified with the changes at the desk, that there be 2 minutes of 
debate divided in the usual form; that upon the use of the time, the 
amendment be agreed to and the motion to reconsider be laid upon the 
table; that the Senate then resume Coburn amendment No. 2196, and there 
be 10 minutes of debate prior to a vote in relation to the amendment; 
that no amendment be in order to the amendments in this agreement; that 
the time be equally divided and controlled between Senators Levin and 
Coburn or their designee; and upon the use or yielding back of time, 
the Senate proceed to vote in relation to the amendment; that 
immediately after disposition of the Coburn amendment, the Senate 
proceed to Menendez amendment No. 2972, and that after the amendment is 
reported by number, there be 6 minutes of debate equally divided and 
controlled between Senators Levin and Menendez, or their designees; 
that upon the use or yielding back of time, without further action, the 
Senate proceed to vote with respect to the amendment; that upon 
disposition of the amendment, that the managers' package which has been 
cleared by the managers, be considered and agreed to; that the Senate 
proceed to vote on the motion to invoke cloture on amendment No. 2011, 
the substitute amendment; that Members have until 8:15 p.m. tonight to 
file any germane second-degree amendments; that if cloture is invoked 
on the substitute, then all time postcloture be considered expired at 
5:30 p.m. this coming Monday, October 1; that upon adoption of the 
substitute, the bill be read a third time, and without further action, 
the Senate proceed to vote on passage of the bill; that the cloture 
motion on the bill be withdrawn; that upon passage, the Senate insist 
on its amendment, request a conference with the House, and the Chair be 
authorized to appoint conferees.
  The PRESIDING OFFICER. Is there objection?
  Mr. McCONNELL. Mr. President, reserving the right to object, and I 
will not be objecting, I just wanted to ask the majority leader if I am 
correct in that if this is entered into, there will be no votes 
tomorrow, and the next vote will be late Monday afternoon?
  Mr. REID. Yes. The first vote will be Monday at approximately 5:30.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The question is on the third reading of the joint resolution.
  The joint resolution was read the third time.
  The PRESIDING OFFICER. Under the previous order, the joint resolution 
is set aside.

                          ____________________