[Congressional Record (Bound Edition), Volume 161 (2015), Part 12]
[Senate]
[Pages 16214-16216]
[From the U.S. Government Publishing Office, www.gpo.gov]




                    FISCAL DEADLINES FACING AMERICA

  Mr. CARDIN. Mr. President, to paraphrase Ronald Reagan, ``Here we go 
again.''
  Treasury Secretary Jack Lew has warned us that the Federal Government 
will bump up against the statutory debt ceiling on Tuesday, November 3. 
Shortly after that, on December 11, the fiscal year 2016 continuing 
resolution will expire, bringing the prospects of yet another 
government shutdown.
  Absent a budget deal to suspend sequestration and lift the spending 
caps imposed under the Budget Control Act, we face draconian spending 
cuts that will harm both our economic recovery and our national 
security. Meanwhile, authority for the Export-Import Bank has expired 
already, and authority to spend surface transportation funding will 
expire at the end of this month.
  This is no way to run a government. It is time to end this mindless 
fiscal brinkmanship and negotiate a comprehensive budget deal that 
resolves all of these issues. The American people demand and deserve no 
less. But first we must act on the debt ceiling.
  With respect to the debt ceiling, Treasury Secretary Lew wrote to 
House Speaker John Boehner on October 15 warning that extraordinary 
measures to forestall hitting the statutory debt ceiling will be 
exhausted as soon as November 3. At that point, the Federal Government 
will have a cash balance of about $30 billion but will be facing 
obligations totaling as much as $60 billion on certain days.
  Secretary Lew wrote in his letter:

       Operating the United States government with no borrowing 
     authority, with only the cash on hand on a given day, would 
     be profoundly irresponsible. As I wrote previously, we 
     anticipate that a remaining cash balance of less than $30 
     billion will be depleted quickly. In fact, we do not foresee 
     any reasonable scenario in which it would last for an 
     extended period of time. The government makes approximately 
     80 million payments a month, including Social Security and 
     veteran benefits, military salaries, Medicare reimbursements, 
     and many others. In the absence of congressional action, 
     Treasury would be unable to satisfy all of these obligations 
     for the first time in the history of the United States . . .
       The creditworthiness of the United States is an essential 
     component of our strength as a nation. Protecting that 
     strength is the sole responsibility of Congress, because only 
     Congress can extend the nation's borrowing authority. 
     Moreover, as you know, increasing the debt limit does not 
     authorize any new spending. It simply allows Treasury to pay 
     for expenditures Congress has approved, in full and on time.

  I couldn't agree with Secretary Lew more. Raising the debt ceiling 
allows us to pay for what has already been appropriated by Congress for 
spending. This has nothing to do with how much we are going to spend as 
a nation; it has everything to do with whether we are going to honor 
our bills. The United States of America has to pay its bills. Just as 
when American families use a credit card, when a bill is due, it needs 
to be paid in a timely manner. At no time in our history has our 
country been unable or unwilling to pay its debts. Raising our debt 
ceiling has to be done--not so we can spend more, as Secretary Lew 
pointed out, but to pay the bills we already have. Default is not an 
option.
  Some Republicans, particularly in the House, have suggested that the 
Federal Government can prioritize its payments to avoid a technical 
default. Some have dubbed this ``pay China first'' because, as my 
colleagues know, much of our public debt is held by the Chinese. It is 
disturbing that our Republican colleagues are considering such a 
proposal. It simply won't work. The Federal Government makes 80 million 
to 100 million payments monthly, including Social Security, veteran 
benefits, military salaries, and Medicare reimbursements. The Treasury 
Department doesn't have the manpower, the computer capability, or the 
guidelines to sort out who gets paid when.
  The Bipartisan Policy Center has prepared a comprehensive analysis of 
what happens if we hit the so-called X-date without lifting the debt 
ceiling. As the Bipartisan Policy Center notes, ``The reality will be 
chaotic,'' with the Treasury Department being forced to pick 
``winners'' and ``losers.'' We might have to shut down the entire 
Justice Department, the Federal courts, the Federal Highway 
Administration, the Federal Aviation Administration, and other 
agencies. These are critically important missions that people in this 
country depend upon. We might have to suspend tax refunds--refunds 
taxpayers desperately need. We might

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have to stop paying Federal workers, 30 percent of whom are veterans 
and contractors. As the Bipartisan Policy Center notes, ``On a day-to-
day basis, handling all payments for important and popular programs, 
(e.g., Social Security, Medicare, Medicaid, Defense, Military Active 
Duty Pay) will quickly become impossible.''
  Delaying the decision to increase the debt limit jeopardizes our 
economy and our standing in the world. The mere suggestion that the 
Federal Government might miss a payment caused Standard & Poor's to 
downgrade our sovereign credit rating from AAA to AA-plus after the 
2011 debt limit standoff.
  A default is a default. We can't pick winners and losers. If we 
default on any of our debt, it will affect our creditworthiness and our 
bond ratings. If we don't transfer the payments to State and local 
governments--and a large part of our budget depends upon them receiving 
their Federal share of programs--it will cause State and local 
governments to default, affecting their bond ratings and increasing the 
cost of borrowing, a hidden tax--not a hidden tax--an additional tax to 
the taxpayers of this country.
  During the last debt limit showdown in 2013, yields for targeted 
securities in secondary markets rose from 1 basis point in mid-
September to over 50 basis points just prior to the resolution of the 
standoff in October. The Government Accounting Office estimates that 
the 2013 impasse cost the Federal Government between $38 million and 
$70 million in added interest payments to service the debt. This is 
what taxpayers had to pay because Congress did not in a timely way 
increase the debt limit. So it is not only the default, it is the time 
we take. We have to act now. We should have acted well before now. If 
we keep playing with fire, we are going to get burned and burned badly.
  In addition to lifting the debt ceiling, which needs to be done 
first, we need to negotiate a comprehensive budget deal. Last week 
administration officials announced that the fiscal year 2015 deficit 
was $44 billion--$44 billion--less than the previous year. Last year's 
deficit was $439 billion. This is still too high, but let's put the 
number in context. It was the lowest share of our economy--at 2.5 
percent--since 2007. As Treasury Secretary Lew pointed out, under the 
President's leadership, the deficit has been cut by roughly three-
quarters as a share of the economy since 2009--the fastest sustained 
deficit reduction since just after World War II.
  It is important to remember that the previous administration--the 
Bush administration--inherited the biggest surpluses in history and 
promptly squandered them on two ill-conceived tax cuts and a war in 
Iraq that was paid for on a credit card.
  Then we had the biggest recession since the Great Depression. This 
was the situation the Obama administration inherited--from surpluses to 
deficits to recession. The Obama administration took effective, 
extraordinary measures to pull the economy back from the brink. 
Economists Alan Blinder and Mark Zandi, writing for the Center on 
Budget and Policy Priorities, estimated that without the measures taken 
in late 2008 and early 2009 the peak-to-trough decline in real gross 
domestic product, which was barely over 4 percent, would have been 
close to a stunning 14 percent; the economy would have contracted by 
more than 3 years, more than twice as long as it did; more than 17 
million jobs would have been lost, about twice the actual number; the 
unemployment rates would have peaked at just under 16 percent, rather 
than the actual 10 percent; the budget deficit would have grown to more 
than 20 percent of GDP, about double the actual 10 percent, topping off 
at $2.8 trillion in fiscal year 2011.
  My point is that the actions taken by the Obama administration pulled 
our economy out of recession and back to growth. It did it in a 
responsible manner. So we took emergency measures necessary to stop the 
economic free fall, and since then we have had the fastest deficit 
reduction since just after World War II.
  We are now using a different policy, as we should. I mention that 
because our Republican colleagues want to cut domestic spending even 
more. That is not sustainable. As the Center on Budget and Policy 
Priorities noted last year, spending cuts have exceeded tax increases 
by a 3-to-1 margin already. Put another way, for every dollar of new 
revenue we have received, we have cut spending by $3.27. We have 
contracted, particularly on the discretionary domestic side.
  We need to come together and negotiate a deal that keeps the Federal 
Government open, not shut. The 2013 shutdown, according to Moody's 
Analytics, cost the economy $20 billion and 120,000 jobs. Still, the 
so-called tea party Republicans and Presidential candidates want to 
shut down the government right before the holidays in a misguided 
notion that it will somehow prevent Planned Parenthood from providing 
health care services to low-income women and their families. Two years 
ago, the same individuals thought that shutting down the government 
would prevent the Affordable Care Act from being implemented. They were 
wrong then, and they are wrong now. The damage they did--and could do 
again--is to our economy and our standing in the world.
  A realistic budget deal will need to protect Federal workers from 
further harm. Since 2011 Federal workers have contributed $159 billion 
to deficit reduction. Federal workers have contributed $159 billion to 
deficit reduction. They didn't cause the deficit. They have endured 3 
years of pay freezes and two substandard pay increases since then for a 
total of $137 billion. They lost another billion dollars in pay because 
of sequestration-related furloughs. Federal employees hired in 2013 and 
since 2014 are paying an extra $21 billion for their pensions.
  Each and every Federal worker is being asked to do more with less as 
agency budgets have been frozen or cut. This is happening to 
hardworking, patriotic public servants who are mostly middle class and 
struggling to get along as are so many other Americans. Enough is 
enough.
  Since the 1950s and 1960s, the U.S. population has increased by 76 
percent and the private sector workforce has surged 133 percent, but 
the size of the Federal workforce has risen just 11 percent. Relative 
to the private sector, the Federal workforce is less than one-half the 
size it was back in the 1950s and 1960s. The picture that emerges is 
one of a Federal civilian workforce whose size has significantly shrunk 
compared to the U.S. population it serves, the private sector 
workforce, and the magnitude of its various missions and Federal 
expenditures.
  Additionally, picking on Federal workers in a budget deal or shutting 
down the government hurts veterans. Over 30 percent of civilian Federal 
employees are veterans, compared to 7.8 percent of the non-Federal 
workforce. The Federal Government hires a lot more veterans--30 percent 
of our workforce--another reason we should be mindful of what we do to 
our Federal workforce. Do we really want to cut the pay and benefits 
for these individuals even more than we have already? Do we really want 
to force them to work during a shutdown but not pay them on time or 
force them to stay home involuntarily and have them worry about whether 
they will be paid at all? Is this how we want to honor the men and 
women who stood in harm's way to defend our Nation and who continue to 
serve us?
  The missions that are carried out by our Federal workforce are great 
missions, and they perform more work in a smaller workforce. It is time 
to recognize what they do for our country. Preventing Federal workers 
from doing their jobs doesn't just harm them; it harms all Americans 
because Federal workers control our borders and make sure our air and 
water are clean and our food and drugs are safe. They support our men 
and women in uniform and care for our wounded warriors. They help our 
manufacturers compete abroad, discover cures for life-threatening 
diseases, and prosecute criminals and terrorists. They maintain and 
protect critical infrastructure, explore the universe, process passport 
applications, and make sure Social Security, Medicare, and other social 
safety net programs are functioning properly. When

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Federal workers do their jobs, they are helping each and every American 
live a safer and more prosperous life.
  Our tasks here in Congress should be straightforward. First, we need 
to raise the debt ceiling so we can continue to pay our bills and 
maintain the full faith and credit of the U.S. Government. Second, we 
need to keep the Federal Government open for business and keep the 
Federal workers on their jobs. Third, we need to negotiate a 
comprehensive budget deal that replaces sequestration--a budget that 
maintains critical Federal investments while spreading the burden of 
deficit reduction in a fair way and holding Federal workers and their 
families harmless after subjecting them to so much hardship over the 
past several months and years. Fourth, we need to reauthorize the 
Export-Import Bank, a bank that helps us with a level playing field on 
international commerce, particularly with small companies, and we must 
reauthorize our surface transportation program on a 6-year 
reauthorization. You can't do a major highway, bridge, or transit 
program with a Federal partner that gives only a couple months of 
commitment. We need to have a multi-year transportation reauthorization 
passed.
  Heretofore, one of the greatest attributes of the American character 
has been pragmatism. We can acknowledge and respect our differences, 
but at the end of the day the American people have entrusted us with 
governing. That means being pragmatic, sitting down, listening to each 
other, compromising, and providing policies that will stand the test of 
time. Let us do our job on behalf of all Americans.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The senior assistant legislative clerk proceeded to call roll.
  Mr. CORNYN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Sullivan). Without objection, it is so 
ordered.

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