[House Report 118-340]
[From the U.S. Government Publishing Office]


118th Congress }                                                {  Report
                        HOUSE OF REPRESENTATIVES
 2d Session    }                                                { 118-340

======================================================================



 
                         DEFAULT PREVENTION ACT

                                _______
                                

January 9, 2024.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Smith of Missouri, from the Committee on Ways and Means, submitted 
                             the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 187]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 187) to ensure the payment of interest and principal 
of the debt of the United States, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
  I. SUMMARY AND BACKGROUND...........................................3
          A. Purpose and Summary.................................     3
          B. Background and Need for Legislation.................     4
          C. Legislative History.................................     4
          D. Designated Hearing..................................     4
 II. EXPLANATION OF THE BILL..........................................4
          A. The Default Prevention Act..........................     4
III. VOTE OF THE COMMITTEE............................................6
 IV. BUDGET EFFECTS OF THE BILL.......................................7
          A. Committee Estimate of Budgetary Effects.............     7
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................     7
  V. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE........7
 VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.......8
          A. Committee Oversight Findings and Recommendations....     8
          B. Statement of General Performance Goals and 
              Objectives.........................................     8
          C. Information Relating to Unfunded Mandates...........     8
          D. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................     9
          E. Duplication of Federal Programs.....................     9
VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED............9
          A. Text of Existing Law Amended or Repealed by the 
              Bill, as Reported..................................     9
VIII.DISSENTING VIEWS................................................10


    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Default Prevention Act''.

SEC. 2. PAYMENT OF OBLIGATIONS.

  (a) In General.--At any time that the debt of the United States 
Government subject to limitation under section 3101 of title 31, United 
States Code, has reached the limitation imposed under such section, the 
Secretary of the Treasury (hereafter in this section referred to as 
``the Secretary'') shall--
          (1) pay Tier I obligations as such obligations become due,
          (2) issue such obligations under chapter 31 of title 31, 
        United States Code, as--
                  (A) are necessary to make the payments described in 
                paragraph (1), or
                  (B) are to be held exclusively by a trust fund 
                referred to in subsection (b)(1)(A),
          (3) pay Tier III obligations only to the extent that the 
        Secretary can still pay all Tier II obligations as such 
        obligations become due,
          (4) pay Tier IV obligations only to the extent that the 
        Secretary can still pay all Tier II and Tier III obligations as 
        such obligations become due,
          (5) pay Tier V obligations only to the extent that the 
        Secretary can still pay all Tier II, Tier III, and Tier IV 
        obligations as such obligations become due, and
          (6) submit to the Committee on Ways and Means of the House of 
        Representatives and the Committee on Finance of the Senate a 
        weekly written report containing the information described in 
        subsection (d).
  (b) Definitions.--For purposes of this section--
          (1) Tier i obligations.--The term ``Tier I obligations'' 
        means payments necessary to provide any of the following:
                  (A) Payment with legal tender pursuant to the 
                authority provided under section 3123 of title 31, 
                United States Code, of principal and interest on debt 
                held by--
                          (i) the public,
                          (ii) the Federal Old-Age and Survivors 
                        Insurance Trust Fund or the Federal Disability 
                        Insurance Trust Fund, or
                          (iii) the Federal Hospital Insurance Trust 
                        Fund or the Federal Supplementary Medical 
                        Insurance Trust Fund.
                  (B) Payments under the Medicare program under title 
                XVIII of the Social Security Act (42 U.S.C. 1395 et 
                seq.).
          (2) Tier ii obligations.--The term ``Tier II obligations'' 
        means payments necessary to provide any of the following:
                  (A) Any obligation of the Department of Defense.
                  (B) Benefits under laws administered by the Secretary 
                of Veterans Affairs.
          (3) Tier iii obligations.--The term ``Tier III obligations'' 
        means any obligation of the United States which is not a Tier 
        I, Tier II, Tier IV, or Tier V obligation.
          (4) Tier iv obligations.--The term ``Tier IV obligations'' 
        means any payment which constitutes any of the following:
                  (A) Compensation for any Federal employee for 
                official time under section 7131 of such title 5, 
                United States Code.
                  (B) Any payment for travel expenses for any officer 
                or employee of the Executive branch of Government, 
                including the President and Vice President, unless such 
                payment is a Tier I or Tier II obligation.
                  (C) Compensation of any officer or employee of the 
                Executive branch of Government (other than an 
                individual in the competitive service, as defined in 
                section 2102 of title 5, United States Code), including 
                the President and Vice President, unless such 
                compensation is a Tier I or Tier II obligation.
          (5) Tier v obligations.--The term ``Tier V obligations'' 
        means compensation of any Member of Congress (as that term is 
        defined in section 2106 of title 5, United States Code).
  (c) Coordination With Public Debt Limit.--Obligations issued under 
subsection (a)(2) shall not be taken into account as subject to the 
limitation imposed under section 3101(b) of title 31, United States 
Code. The preceding sentence shall not apply with respect to any 
obligation after the first date (after the issuance of such obligation) 
on which any modification or suspension of such limitation takes 
effect.
  (d) Weekly Reports.--The written report referred to in subsection 
(a)(6) shall include, with respect to the period covered by such 
report--
          (1) the amount of Tier I obligations paid under subsection 
        (a)(1) during such period,
          (2) the amount of obligations issued under subsection (a)(2) 
        during such period, and
          (3) the amount of Tier II obligations, Tier III obligations, 
        Tier IV obligations, and Tier V obligations which were paid 
        during such period (stated separately for each tier) and the 
        aggregate amount of such obligations which were due and unpaid 
        as of the close of such period (stated separately for each 
        tier).
  (e) No Inference With Respect to Existing Authority to Prioritize 
Payments.--During any period with respect to which this section does 
not apply, nothing in this section shall be interpreted to restrict the 
authority of the Secretary to prioritize the payment of certain 
obligations over other obligations.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    The bill, H.R. 187, the ``Default Prevention Act,'' as 
ordered reported by the Committee on Ways and Means on March 9, 
2023, directs the Secretary of the Treasury (Treasury) to issue 
new debt when the statutory limit is reached to the extent 
necessary to pay the principal and interest on publicly held 
debt and to issue to and redeem assets from the Social Security 
Trust Funds for the purposes of paying Social Security 
benefits. The bill would also extend this debt authority to the 
extent necessary to issue to and redeem assets from the 
Medicare Trust Funds, and provide payments under the Medicare 
program.
    In addition, aside from the aforementioned obligations, the 
amendment prohibits the Treasury from meeting any remaining 
obligations, unless the Treasury can still meet the obligations 
of the Department of Defense, and any obligations necessary to 
provide benefits under the Department of Veterans Affairs. The 
bill would generally prohibit the Treasury from meeting 
obligations related to compensation for official time, payment 
for government travel, and payments to the President, Vice 
President, and other members of the excepted service unless all 
other obligations except for payments to Members of Congress 
can still be met. Finally, the bill would specifically prohibit 
the Treasury from providing compensation to any Member of 
Congress unless all other obligations can still be met.
    The bill would also direct the Treasury to provide weekly 
reports to the House Committee on Ways and Means and the Senate 
Committee on Finance regarding the amount of new debt issued 
under the authority provided, and on the obligations met and 
unmet over the prior week.
    Lastly, the bill would clarify that the specific directive 
authority provided by the bill should not be interpreted as 
otherwise modifying any existing authority of the Treasury to 
prioritize the payment of certain obligations over others.

                 B. Background and Need for Legislation

    The consequences of the U.S. Government failing to make 
timely and complete payment on Treasury debt, that is, a 
default, could be severe. A default would not only be a great 
discredit to our nation's standing in the world, it would also 
raise borrowing costs, which, in turn, would threaten our 
ability to finance essential government functions going 
forward. In addition, a default could push the country into a 
recession. The legislation removes the risk of default by 
providing a mechanism to ensure that principal and interest on 
U.S. debt obligations are paid. Furthermore, it protects 
seniors by ensuring the debt limit does not prevent Social 
Security and Medicare benefits from being met; stands with 
Americans in uniform by prioritizing our nation's security, 
servicemembers, and veterans; and holds the President and 
lawmakers accountable by ensuring that they don't receive 
compensation until other obligations are met.

                         C. Legislative History


                               BACKGROUND

    H.R. 187 was introduced on January 9, 2023, and was 
referred to the Committee on Ways and Means.

                           COMMITTEE HEARINGS

    On February 6, 2023, the Committee held a field hearing on 
the state of the American economy in Appalachia (Petersburg, 
West Virginia), where management of debt was discussed.
    On March 7, 2023, the Committee held a field hearing on the 
state of the American economy in the Heartland (Yukon, 
Oklahoma), where management of debt was discussed.

                            COMMITTEE ACTION

    The Committee on Ways and Means marked up H.R. 187, the 
``Default Prevention Act,'' on March 9, 2023, and ordered the 
bill, as amended, favorably reported (with a quorum being 
present).

                         D. Designated Hearing

    Pursuant to clause 3(c)(6) of rule XIII, the following 
hearings were used to develop and consider H.R. 187:
          (1) Committee on Ways and Means field hearing which 
        took place on February 6, 2023, entitled: ``The State 
        of the American Economy: Appalachia''.
          (2) Committee on Ways and Means field hearing which 
        took place on March 7, 2023, entitled: ``The State of 
        the American Economy: The Heartland''.

                      II. EXPLANATION OF THE BILL


                     A. The Default Prevention Act


                              PRESENT LAW

    Article 1, Section 8 of the Constitution grants Congress 
sole authority over the fiscal powers to tax, spend, and 
borrow:
          The Congress shall have Power To lay and collect 
        Taxes, Duties, Imposts and Excises, to pay the Debts 
        and provide for the common Defence and general Welfare 
        of the United States . . . To borrow Money on the 
        credit of the United States
    Congress initially exercised this authority directly, but 
gradually delegated more and more of this authority to the 
Executive Branch, primarily to the Treasury. With few 
exceptions, the federal government has run at some annual 
deficit level since the 1930s, requiring the government, 
through the Treasury, to issue and manage debt to cover the 
difference.
    While Congress has placed limitations on the federal 
government's authority to issue debt, the modern debt limit, 
which places an aggregate limit on the Treasury's general 
delegated authority to issue debt, was first established in 
1939. Once the debt limit is reached, the Treasury may no 
longer issue additional debt if doing so would increase the 
total amount of outstanding debt subject to the limit. After 
reaching the debt limit, the Treasury can continue to finance 
the government for a limited time under existing authority 
through a combination of incoming revenues and the use of 
``extraordinary measures.'' These measures provide temporary 
liquidity to the Treasury for operations but generally must be 
repaid with interest once the debt limit is increased.
    In fiscal year (FY) 2023 the federal government is 
projected to run a $1.4 trillion deficit, and over the next 
decade, the federal government is projected to spend $1.33 for 
every $1 in revenue. Ordinarily, these budget shortfalls would 
be financed through the issuance of debt, but the current debt 
limit, which applies to approximately 99 percent of all 
federally issued debt, is set at $31.4 trillion and was reached 
on January 19, 2023. In a January 13 letter to Congress, 
Secretary Yellen said that the Treasury could use extraordinary 
measures to finance the government through at least early June 
2023.
    In December 2021, the Democrats raised the debt limit by a 
record $2.5 trillion, but it only took about a year for 
Democrat spending to max out the federal government's credit 
again.

                           REASONS FOR CHANGE

    The policy provisions in H.R. 187 are intended to protect 
the full faith and credit of the United States by permanently 
removing the risk that the United States could default on its 
debt obligations; protect seniors by ensuring that the debt 
limit does not prevent Social Security and Medicare benefits 
from being met; stand with Americans in uniform by prioritizing 
our nation's security, servicemembers, and veterans; and hold 
the President and lawmakers accountable by ensuring that they 
don't receive compensation until other obligations are met.

                       EXPLANATION OF PROVISIONS

    Section 1 provides the short title of the bill as the 
``Default Prevention Act''.
    Section 2 provides that in the event the debt of the United 
States Government reaches the statutory limit, the Treasury 
shall issue debt to the extent necessary to pay principal and 
interest on certain obligations as defined. Obligations for 
which debt shall be issued are limited to those obligations 
held by the public or those necessary to issue to and redeem 
assets from the Social Security Trust Funds, to issue to and 
redeem assets from the Medicare Trust Funds, and to provide 
payments under the Medicare program. Obligations issued 
pursuant to this authority are exempt from the statutory debt 
limit.
    Section 2 also prohibits the Treasury from meeting any 
remaining obligations, unless the Treasury can still meet the 
obligations of the Department of Defense, and any obligations 
necessary to provide benefits under the Department of Veterans 
Affairs; generally prohibits the Treasury from meeting 
obligations related to compensation for official time, payment 
for government travel, and payments to the President, Vice 
President, and other members of the excepted service unless all 
other obligations except for payments to Members of Congress 
can still be met; and, specifically prohibits the Treasury from 
providing compensation to any Member of Congress unless all 
other obligations can still be met.
    Additionally, Section 2 directs the Treasury to provide 
weekly reports to the House Committee on Ways and Means and 
Senate Committee on Finance regarding the amount of new debt 
issued under the authority provided, and on the obligations met 
and unmet over the prior week, and clarifies that the specific 
directive authority provided by the bill should not be 
interpreted as otherwise modifying any existing authority of 
the Treasury to prioritize the payment of certain obligations 
over others.

                             EFFECTIVE DATE

    The bill would become effective upon enactment.

                       III. VOTE OF THE COMMITTEE

    In compliance with the Rules of the House of 
Representatives, the following statement is made concerning the 
vote of the Committee on Ways and Means during the markup 
consideration of H.R. 187, the ``Default Prevention Act'' on 
March 9, 2023.
    H.R. 187 was ordered favorably reported to the House of 
Representatives as amended by a roll call vote of 21 yeas to 17 
nays (with a quorum being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
        Representative             Yea       Nay      Present    Representative      Yea       Nay      Present
----------------------------------------------------------------------------------------------------------------
Mr. Smith (MO)................        X   .........  .........  Mr. Neal........  ........         X   .........
Mr. Buchanan..................        X   .........  .........  Mr. Doggett.....  ........         X   .........
Mr. Smith (NE)................        X   .........  .........  Mr. Thompson....  ........         X   .........
Mr. Kelly.....................        X   .........  .........  Mr. Larson......  ........         X   .........
Mr. Schweikert................        X   .........  .........  Mr. Blumenauer..  ........         X   .........
Mr. LaHood....................  ........  .........  .........  Mr. Pascrell....  ........         X   .........
Dr. Wenstrup..................  ........  .........  .........  Mr. Davis.......  ........         X   .........
Mr. Arrington.................        X   .........  .........  Ms. Sanchez.....  ........         X   .........
Dr. Ferguson..................        X   .........  .........  Mr. Higgins.....  ........         X   .........
Mr. Estes.....................  ........  .........  .........  Ms. Sewell......  ........  .........  .........
Mr. Smucker...................        X   .........  .........  Ms. DelBene.....  ........         X   .........
Mr. Hern......................        X   .........  .........  Ms. Chu.........  ........         X   .........
Ms. Miller....................        X   .........  .........  Ms. Moore.......  ........         X   .........
Dr. Murphy....................        X   .........  .........  Mr. Kildee......  ........         X   .........
Mr. Kustoff...................        X   .........  .........  Mr. Beyer.......  ........         X   .........
Mr. Fitzpatrick...............        X   .........  .........  Mr. Evans.......  ........         X   .........
Mr. Steube....................  ........  .........  .........  Mr. Schneider...  ........         X   .........
Ms. Tenney....................        X   .........  .........  Mr. Panetta.....  ........         X   .........
Mrs. Fischbach................        X   .........  .........
Mr. Moore.....................        X   .........  .........
Mrs. Steel....................        X   .........  .........
Ms. Van Duyne.................        X   .........  .........
Mr. Feenstra..................        X   .........  .........
Ms. Malliotakis...............        X   .........  .........
Mr. Carey.....................        X   .........  .........
----------------------------------------------------------------------------------------------------------------

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the bill, H.R. 187, as 
reported. The estimate prepared by the Congressional Budget 
Office (CBO) is included below.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
bill involves no new or increased budget authority. The 
Committee states further that the bill involves no new or 
increased tax expenditures.

      V. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided.




    H.R. 187 would require the Treasury to prioritize payment 
of obligations using a five-tiered payment structure if total 
debt subject to limit is at the statutory maximum. Under the 
bill the Treasury could issue debt that would not be subject to 
the statutory limit in amounts that would be sufficient to meet 
obligations for the first tier: the principal and interest on 
the public debt and the obligations of Social Security and 
Medicare. Payment of obligations would be prioritized as 
follows:
           Tier I would include payments for public 
        debt, Social Security, and Medicare;
           Tier II would include payments for 
        obligations of the Departments of Defense and Veterans 
        Affairs;
           Tier III would include payments for 
        obligations of any program not in a designated tier;
           Tier IV would include payments for certain 
        federal employee union activities, executive branch 
        travel, and compensation of the President, Vice 
        President and some political appointees; and
           Tier V would include compensation to Members 
        of Congress.
    Until a new debt limit is enacted, the bill would require 
the Treasury to report each week to the House Committee on Ways 
and Means and the Senate Committee on Finance concerning 
exempted transactions and categorical spending.
    CBO estimates that enacting H.R. 187, by itself, would not 
affect direct spending or revenues because it would not change 
any of the government's tax or spending policies. CBO estimates 
that implementing the bill's tiered-payment system and weekly 
reporting requirement would increase the Treasury's 
administrative costs; any related spending would be subject to 
the availability of appropriated funds. CBO does not have a 
basis to assess the feasibility, the required time to 
implement, or the total cost to the Treasury to develop such a 
payment system. We estimate those costs would significantly 
exceed $500,000 because the Treasury's payment systems are not 
currently set up to handle different priorities. Based on the 
requirements in the bill and the cost of similar reports, CBO 
estimates that the weekly reporting requirement would cost less 
than $500,000 each time debt subject to the limit reaches the 
statutory limit.
    The CBO staff contact for this estimate is Avi Lerner. The 
estimate was reviewed by H. Samuel Papenfuss, Deputy Director 
of Budget Analysis.

                                         Phillip L. Swagel,
                             Director, Congressional Budget Office.

     VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, the Committee made findings and 
recommendations that are reflected in this report.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill does not authorize funding, so no statement of general 
performance goals and objectives is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

  D. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill, and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                   E. Duplication of Federal Programs

    In compliance with clause 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program; (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139; or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to the Federal Program 
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No. 
98-169).

       VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED


  A. Text of Existing Law Amended or Repealed by the Bill, as Reported

    With respect to the requirement of clause 3(e) of rule XIII 
of the Rules of the House of Representatives, changes in 
existing law made by the bill, as reported, this section was 
not made available to the Committee.

                         VIII. DISSENTING VIEWS

    This legislation does nothing to prevent default, despite 
its misleading title. At best, it provides a roadmap for what 
to do if Republican extremists in Congress force the first-ever 
default on the full faith and credit of the United States. It's 
a frightening roadmap, one that directs the Treasury to pay 
foreign bondholders while defaulting on pay and benefits to 
veterans and members of the Armed Forces, Medicaid payments to 
nursing homes, our nation's family farms, and refunds owed to 
American taxpayers.
    More likely, this bill is a political game intended to make 
negotiating unpopular cuts to Medicare and Social Security seem 
like the only way to prevent default. The Republican Study 
Committee, which represents the majority of House Republicans, 
has put forth a plan to cut Social Security by $729 billion 
over the next decade while raising the eligibility age for 
Medicare and denying seniors health coverage.
    The consequences of Republican gamesmanship and failure to 
govern could be catastrophic for our strong economic recovery. 
We know from prior crises provoked by Republican extremists 
that even talking about defaulting costs us jobs, costs 
taxpayers money, and lowers the balances in retirement funds 
for millions of workers. In 2011, Republican default threats 
led to a first-ever downgrade in the U.S. credit rating, a 
private sector hiring freeze, and a stock market plunge. A new 
round of threats in 2013 reduced GDP by 0.25 percentage point 
and cost taxpayers an estimated $70 million in additional 
borrowing costs. In 2015, Republicans brought a bill very 
similar to this one to the House floor, and for the first time 
ever, Treasury was forced to cancel an auction because 
investors were unwilling to buy short-term Treasury bonds at 
any price.
    Although this legislation purports to allow payments to 
seniors to continue while we default on other obligations, 
Republicans offered no plan for how to make that logistically 
possible. For over a decade, Treasury Secretaries and experts 
from both parties have said that ``prioritizing'' debt is 
logistically impossible. The Treasury makes an average of 5 
million payments every business day--a projected 1.28 billion 
payments this year. To pay those bills on time, as we always 
have, they rely on systems that pay all obligations 
automatically, in the order they are due. When Democrats raised 
questions about whether Treasury had been consulted, the Chair 
suggested that Members could ask the Treasury Secretary, who 
was scheduled to appear before us the day after we voted on the 
bill. At our hearing the next day, no Republican Member chose 
to ask the Treasury Secretary. Democrats did ask, and the 
answer was the same. It's not possible.

                                           Richard E. Neal,
                                                    Ranking Member.
Ranking Member Richard E. Neal Opening Statement, Committee on Ways and 
           Means Markup of H.R. 187, Thursday, March 9, 2023

    Thank you, Mr. Chairman. We are here today to go through a 
rite of passage for new Republican majorities. They run on 
combatting inflation, and making the economy work for the 
American people. Only to take control and start calling for 
cuts to Social Security, Medicare, and Medicaid in the name of 
fiscal responsibility. All while risking the full faith and 
credit of the United States and plotting unfunded tax cuts for 
the wealthy and well-connected.
    Today, they are bringing forth legislation that 
acknowledges they will put extremism before responsibility, 
potentially preventing the United States from paying its bills.
    Debt prioritization is impossible, but that hasn't stopped 
Republicans before. So, congratulations are in order, Mr. 
Chairman. You've officially joined the ranks of Republican 
Chairmen that came before you.
    Republican and Democratic Treasury Secretaries, along with 
bipartisan experts, have been telling us this wouldn't work for 
over a decade. The Treasury makes an average of 5 million 
payments every day. You can't flag some in the computer to pay 
on time, leaving others past due.
    Prioritization legislation is a way of making default sound 
acceptable, not a way of preventing it. They want default to 
sound manageable by promising to pay some of our bills. 
Republican extremism is the single largest threat to the 
American people. And if governing was the goal, they would 
raise the debt ceiling just a they did THREE times under the 
former president. Even the most skilled Republican legislator 
of our time, Leader McConnell knows this legislation is a sham 
and wouldn't stand a chance in the Senate. This legislation 
doesn't protect anyone. It's a haphazard attempt to cover up 
their inability to govern, and the American people will see it 
for what it is.
    The ``Pay China First'' bill would make my Republican 
colleagues responsible for:
           Delays in Social Security checks;
           Putting our military at risk;
           Veterans not getting their benefits;
           Banks and small businesses collapsing;
           Jobs disappearing, and more.
    We can't predict just how bad this would be because it's 
never happened before, but what we do know: Republicans don't 
have a plan. Even TALKING about default has real consequences. 
This is now the fourth time in the last decade that Republicans 
have set us off on this course.
    Back in the summer of 2011, the Republican impasse caused:
           The Treasury was forced to spend $1.3 
        billion more in interest payments, according to a 
        Government Accountability Office estimate.
           And of course, who could forget that the 
        U.S. credit rating was downgraded for the first time in 
        our history.
    Republicans followed up in 2013 and:
           An estimated 120,000 jobs were lost.
           Rates for commercial paper rose as a direct 
        result of the standoff, disrupting private markets.
    Then to the most recent dispute, in 2015:
           For the first time ever, Treasury was forced 
        to postpone the release of a new bond due to lack of 
        demand; a major blow to our credibility;
           And bill supply declined by $210 billion 
        after Treasury was forced to reduce bill issuance.
    These are costs to taxpayers, and when the Republican 
extremism before us now is injected into our financial markets, 
taxpayers will bear the brunt in higher costs.
    The fact we are even having this conversation is a 
dereliction of duty. When the American people entrusted 
Republicans to govern, we saw the calamitous effects in 2011, 
2013, and 2015, I urge them to learn from those mistakes and 
put the country ahead of political games. With that, I yield 
back the balance of my time.