[Congressional Record (Bound Edition), Volume 157 (2011), Part 5]
[Senate]
[Pages 7314-7316]
[From the U.S. Government Publishing Office, www.gpo.gov]




                               DEBT LIMIT

  Mr. COATS. Mr. President, I appreciate the remarks of my colleague, 
Senator Levin. I just caught the tail end, but it is a good segue into 
what I wish to speak about today.
  Today is May 16, an important day for me, because it happens to be my 
birthday, although I am not anxious to have any more birthdays and it 
is no big deal. This day is more important because this is the day that 
Treasury Secretary Geithner said we have reached the debt limit 
ceiling.
  I read from this missive that came out a little bit ago:

       Treasury Secretary Timothy Geithner announced on Monday 
     morning that the Federal Government had met its statutory 
     borrowing limit of $14.294 trillion cap.

  This is the day we have been talking about for a long time. In fact, 
this day had been advertised as the likely date on which the United 
States would hit the debt limit.
  Here we are with an empty floor on a Monday and people are saying, 
Whoa, shouldn't you guys have been in every night last week and all 
weekend to avert hitting this limit, because doesn't this mean we have 
to default on our debt? Well, as the article goes on to report:

       Treasury will now begin a series of ``extraordinary'' 
     measures designed to stave off a potential government 
     default.

  Treasury has been able to move some money around so that now we won't 
reach that magic date until August 2.

[[Page 7315]]

  Is this good news or bad news? Well, it is maybe good from the 
standpoint that we may have avoided a catastrophic situation today, but 
it simply postpones the date of the inevitable. What I fear is that it 
simply gives us more time to avoid getting engaged in dealing with what 
is arguably one of the largest crises in American history, particularly 
in American financial history. So when we look at what has been 
transpiring over the last several years, as all of us have watched with 
alarm, our debt limit continues to climb at an unprecedented rate and 
there has been not nearly enough debate and engagement on how we should 
address this. I know the last several months have been filled with 
proposals and plans and dire predictions. The last year--2010, an 
election year--certainly aroused the interests of the American people, 
when I think for the first time the reality became clear on what the 
increase in the debt and the deficits is doing to our country's 
financial health.
  I have this chart here on the left which shows total U.S. debt and 
statutory debt limit from the years 1941 to 2011. In December 1941, we 
were engaged in World War II. We see a small little spike here in terms 
of the debt limit. That is understandable, because we were in a crisis 
situation and we had to put all of our efforts and expenditures into 
production to address the war needs. But as we can see, from 1941 all 
the way through to 1981, we moved along at a fairly low level of 
increase in debt and finally hit the $1 trillion mark in 1981. So for 
more than 200 years in the history of this country, we ran this country 
without going more than $1 trillion in debt. That is enough as it is. 
But I remember at the time, in 1981, people were saying, How could this 
be possible? How could we possibly reach this limit, $1 trillion? We 
can hardly comprehend it.
  The sad news is that since 1981 we have been on a steady incline of 
debt, which has accelerated dramatically in the last few years. Today--
May 16, 2011--we have hit a total of nearly $14.3 trillion in debt. 
This line continues off this chart and goes much higher as we project 
forward the spending, much of which is occurring because of mandatory 
spending put in place for programs that were locked in and it is 
obligatory spending on the part of the Federal Government. Of course, 
as we go forward, the interest rate on our debt increases and the 
amount we pay each year increases. So we find ourselves in a spiral, a 
downward spiral of debt that seems to have no end.
  This is no surprise to most people because there has been focus on 
this all across America over the last couple years. Throughout this 
period of time, people have had to stretch their own dollars at home in 
order to make ends meet. Businesses have had to make significant 
changes in the way they do business in order to make ends meet. State 
governments have found they are deeply in debt and have had to take 
some dramatic measures. But it is only now that the Federal Government 
is starting to look seriously at what we need to do.
  All throughout the year 2010, with no budget in place, Congress 
continued to spend. But I am not here to place blame on any one 
individual or any one group. I am simply here to point out the fact 
that we have a serious crisis at hand and it deserves serious debate 
and a serious solution or we are going to find our country in very 
difficult straits.
  From this point forward, as shown on the chart, Congress has been run 
by Democrats and Republicans. The Presidency has been held by Democrats 
and Republicans. So we can go back and say: Well, who is responsible 
for this and who is responsible for that and what about here and what 
about there? That is a wasted effort at this particular point in time. 
This is the situation we face, and this is the situation with which we 
must address.
  I regret that the Senate, to date--other than activities such as 
Senator Levin was engaged in, I am engaged in; that is, coming to the 
floor at a time when the issue is not before us in terms of seeking a 
resolution but simply stating the facts and urging us to move forward--
I regret that this year we have spent a total of only 4 hours and 20 
minutes of actual debate on the spending. Instead, we have been tied up 
for weeks on not trivial but far less serious measures: confirming some 
judges to district and appellate court positions, dealing with the 
Federal Aviation Administration reauthorization bill, which took 
several weeks. Now we have been stuck on the small business 
authorization bill for several weeks, injecting here and there in some 
debate and some talk and discussion about the deficit but no real focus 
on that.
  If we do not set aside the less important and begin to focus on what 
we need to do, we are going to quickly find ourselves into the month of 
July careening toward an August 2 deadline, during which time the 
uncertainty that exists in the investment community and in the business 
community and in households, in terms of spending and what the future 
might bring--all that continues.
  What the world is waiting for, and what the world is watching and 
hoping and praying for, is that the Congress and the executive branch 
will work together to seek a solution to this problem that will bring 
reassurance to the investment world and bring confidence to our 
population that we have gotten serious and we are going to do something 
about this.
  None of us believe this is going to be easy. None of us believe this 
is going to be painless. But we simply cannot postpone the debate that 
needs to take place, not only in this Chamber and in the House of 
Representatives but between the House and the Senate and the White 
House.
  Some conversations have already started in that regard but also 
across the Nation. This is a debate that has to come before the 
American people because they are going to be the ones who are going to 
bear the brunt of whatever cuts and whatever solutions need to take 
place in order to put us on the right fiscal track.
  If I have learned anything in discussions outside this Chamber with 
people who have studied and analyzed and looked at this issue, it is 
that several things must take place, and they must take place 
immediately. A host of people who have spent their lives understanding 
the dynamics of the financial system--understanding the consequences of 
debt as a percentage of gross national product, understanding the 
consequences of how a nation rises to this level of debt, the 
consequences of that to its people and to its financial future and its 
stature in the world and its ability to do the many wonderful things 
the United States has been able to do, to lead the world in so many 
different areas--all this is in jeopardy if we do not address this 
issue.
  What they are saying, if I could bring that into just some basic 
conclusions, is, No. 1, this crisis is real. All you have to do is look 
at this chart I have in the Chamber to understand this crisis is real. 
Here is where we were in World War II when we were having to go into 
debt, which we thought was serious at the time. But look at what has 
happened in just the last 30 years.
  So the crisis is real. As measured by historical analysis of nations 
that have faced these kinds of situations before, the consequences are 
always dire. Therefore, No. 1--and I was glad to hear my Democratic 
colleague acknowledge this is the case because this is something both 
sides of the aisle are going to have to deal with--both sides have to 
recognize that, No. 1, the crisis is real and it is now.
  The second conclusion, based on what the experts are saying, is that 
we have to act now, not later. This is not something we can postpone. 
For years and years and years, as this line has gone forward, as shown 
on this chart, Congress has said: We'll get to that. Presidents have 
also said: We need to address our debt, but only after the next 
election.
  Well, there is always a next election. Now the latest thing we hear 
is: Well, we need to take care of that after the 2012 election. We will 
put it before the American people in terms of which way they want to 
go.
  The American people spoke very loudly and clearly in 2010. If that 
was not a wake-up call politically, I do not know what will be. But, 
nevertheless,

[[Page 7316]]

falling into the trap of simply saying that waiting until after the 
next election we might be in a better position to deal with it then 
simply postpones the inevitable and potentially brings about a crisis 
which will occur before the election in 2012.
  It is shameless to put before the American people that the political 
situation is such that we are not willing to address this now and, 
therefore, we are putting their lives, their futures, their children's 
futures, and their children's children's futures in jeopardy, while we 
place a higher priority on the political outcome of 2012 rather than on 
what we were elected to do in 2010 and years before.
  No. 1, the crisis is real. No. 2, we have to act now without delay. 
No. 3, many experts have advised that, if we do something, it needs to 
be a comprehensive plan that includes all aspects of Federal spending. 
We need to talk about the discretionary part of our budget, which we 
vote on every year, although in the last couple of years we have not 
even passed a budget. Last year, we failed to pass a single 
appropriations bill. Instead, we have had continuing resolutions and 
supplemental spending bills, which is not what we were elected to do 
and not a good way to govern. But we have to address that portion of 
the budget.
  When addressing a long-term economic plan, we cannot exempt major 
sectors of our budget such as interest and defense and mandatory 
spending and we must include entitlements. That is No. 4, many experts 
say. If you do not have a comprehensive plan that includes everything, 
then the burden falls on a disproportionate share of discretionary 
spending that undermines essential programs the government ought to be 
engaged in.
  We cannot get from here to there without including all aspects of the 
budget, including comprehensive tax reform. That is another thing these 
experts have said. Many say the comprehensive plan must include some 
basis on which we move forward with tax reform.
  Senator Wyden and I have cosponsored a bipartisan bill for that very 
effort. We are not saying it is the perfect bill. We are saying it is 
something in place with which we could start on and address 
comprehensive tax reform, to broaden the base and generate more revenue 
from the economic growth that comes with lowering taxes and reforming 
the tax code.
  Entitlements are a must. That is what these people have said. You 
cannot get from where we are now to where we need to be unless we 
include Medicare, Medicaid, and Social Security reforms. We all know 
there are structural problems, given the massive move into retirement 
age of the baby boom population of this country. We all know these 
programs are teetering on the edge. There was a report from the 
trustees of Medicare last week saying they are moving up 5 years when 
Medicare runs out of money in order to pay for benefits that are 
promised under that program.
  We all know there are some relatively painless solutions the earlier 
we start, in terms of adjusting the retirement age, in terms of 
adjusting some formulas, and making some of the changes that have been 
proposed that we are talking about. But if we do not include that 
entitlement spending in our discussions, we are not going to be able to 
reach a successful conclusion.
  Another principle they have listed is that we have to make this for 
the long term and we have to lock it in. We have to guarantee the 
promises we make and the commitments we make, as we address this 
problem of how much to cut and how to change the Tax Code and how to 
work through the revenue side of this effort. They have to be locked in 
place and guaranteed, hopefully, with the passage of a constitutional 
amendment to balance the budget.
  We failed twice in the 1990s in this Senate to pass a constitutional 
amendment to send to the States for ratification. It failed by one vote 
on two occasions. I wonder what would have happened had we passed that. 
No, I do not wonder. I know what would have happened. We would have 
been forced to make the decision at this point, as shown on the chart, 
which would have brought us back to here instead of now having to go 
from this point on the chart all the way down--a much more painful 
process than had we passed that amendment then.
  So what we want to avoid, when we are forced to do this--and it is 
going to happen; we have to do it--we need to lock that in on a path 
that will bring us back to fiscal parity and balanced budgets and then 
lock it in with a constitutional amendment. It cannot be done in 1 
year. That is why the other principle is that this has to be a long-
term process in getting us from where we are to where we need to go, 
and then we need to stay with it. We cannot just pass it for 2 years, 
elect a new Congress and come in and make these changes.
  If we move forward, and if we can come together to find a rational 
solution to this, it will send--this is the last point the experts have 
said--it will send a tremendous signal around the world to all those 
investors who have always looked to the United States as the safe-
haven, last-resort place to put their money. The dollar will be rescued 
from falling against other currencies. It will continue to be seen as 
the world's currency. Confidence in the United States as a safe place 
to put your money will be restored in nations around the world. The 
American people will have a tremendous psychological sense of relief 
and assurance that we are finally getting serious about doing something 
about this crisis that faces us.
  Lastly, what I would like to do is send a message to President Obama, 
the majority leader, my Republican and Democratic colleagues, the 
minority leader, and others: The time is now. I believe we should 
suspend, as soon as we can, everything but the absolute essential and 
spend the next amount of time, starting now, debating and working 
through--whether it takes day and night and weekends--rolling up our 
sleeves and sitting down, holding this debate across the country, to 
get input from the public, but also meeting together, working to find a 
solution to this, which we all recognize has to be done, without 
letting this thing trail all the way to late July and then do something 
in a panic.
  This crisis is going to occur. It is going to occur probably sooner 
than we think. The last piece of advice they gave us--I know I said it 
just a minute ago--but the other piece of advice they gave us was: 
Trust us, you do not want the financial markets to force you into doing 
things that will be done in a rush, that will be done in a panic, that 
will not be rationally applied; and instead of having a principled, 
rational way of solving this problem, we will be in crisis mode, and we 
will be having to make decisions that will have a significant negative 
impact on our public and on the world.
  I hope to keep talking about this issue. I hope to keep urging our 
leadership to suspend all but the essential of what we are now doing 
and that all of us commit whatever time it takes to bring about a 
debate and a decision as to how we are going to go forward. Put it in 
front of the American people. Let our yea be yea and our nay be nay. 
Then at least we will know where we stand and we, hopefully, can come 
together to find a reason to forgo letting the markets do this for us, 
which everyone concedes is not the way to go.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. KYL. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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