[Pages S4751-S4779]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

CUT, CAP, AND BALANCE ACT OF 2011--MOTION TO PROCEED--Continued

The PRESIDING OFFICER. The Senator from Florida is recognized.
Mr. RUBIO. Mr. President, I ask unanimous consent that I be
recognized to speak for up to 15 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. RUBIO. I was witness a few minutes ago to an interesting and
informative exchange and wanted to comment on that briefly. Both the
leader and the senior Senator from New York had some comments that I
think are important in the context of what is being discussed here
today. But I wanted to come to the floor today because we have been
getting a lot of phone calls and letters from people back home who are
wondering--people--what this is all about. These are folks who are out
working every day and raising a family and running their businesses.
They want to understand what the debate here is about. They get the
gist of it, that there is this debt limit fight, and that Congress, if
it does not do anything, may not be able to pay some bills beginning
August 2.
But what is behind all of this? The best way to explain it to people
is to equate it to the lives of real people in the real world.
Every single one of us as adults has a credit rating. In essence,
there are two or three companies out there that basically rate you as
an individual. What they do is give you a credit rating that
determines, No. 1, whether you are willing to pay back; and, No. 2,
whether you have the money to pay people back. Based on that you get
something called a credit score. People are familiar with that. Every
time you try to go lease or buy a car or buy a house or anything on
credit, they are going to run your credit. It is going to tell them:
This is John Smith, this is so-and-so, and this is his credit rating.
Based on that, people will decide whether to lend you money.
Countries have credit ratings too. It is based on two things. No. 1
is your history of paying people back; and, No. 2, on your ability to
pay them back in the future.
There are three major companies in the world that give credit ratings
to countries--three major companies. What those companies are saying
right now is we are looking at America and we are worried. We are
worried about two things. They are worried about this debt limit issue,
and the fact that if the debt limit is not raised, they are going to
downgrade us because we are going to miss payments on this, that, or
the other. They are worried about that.
But they are a lot more worried about something else. It is not our
willingness to pay back, it is our ability to pay back people who lend
money to the United States.
Let me read you some of the quotes. This is from Moody's, which is
one of the top ones. They write: ``If the government avoids default, we
will likely affirm America's AAA rating.''
America has the highest credit rating in the world right now that you
can possibly get. They say: If we avoid default, they will likely
affirm our AAA rating, but they will still assign us on something
called a negative outlook, unless there is--this is the money line--``a
substantial and credible budget agreement to cut the deficit.''
What they are basically saying is, if you raise the debt limit, you
may temporarily avoid being downgraded, but

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ultimately we are still putting you on a watchlist and we ultimately
are still going to downgrade you unless we have a substantial and
credible budget agreement to cut the deficit.
What does that mean? They go on to elaborate. They say: The agreement
should include a deficit trajectory--basically a path of deficits--that
leads to stabilization and ultimately a decline in your deficit,
particularly in how much money you owe compared to how big your economy
is.
That is what they want to see, a plan in place that shows how we stop
growing the deficit and then how we start reducing it. That is what
they are saying. Then they actually talk about specific numbers. They
have said, their analysts have said we think $1.5 trillion of cuts this
year--over the next 10 years--is a plan that is too little. We think $4
trillion might be enough. That is from Moody's.
Standard & Poor's, the other rating company, wrote very clearly that
even if the parties--meaning Republicans and Democrats--agree to raise
the debt limit, it may not be enough to avoid downgrade.
That is the second credit house. They are saying: Even if you raise
the debt limit, we may still downgrade you. In order to avoid a
downgrade, you need a plan that reduces annual budget deficits by at
least $4 trillion over the next 10 years.
We hear the $4 trillion number again. This is the second rating
company basically saying: Yes, the debt limit is a problem. What we are
worried about is, do you have a plan to deal with the debt and the
deficit?
Then the third major company, called Fitch, wrote that they are
looking for an agreement on credible fiscal consolidation strategy in
order to secure America's top credit rating, a triple A.
So the three major houses' rating which is what this is all about at
the end of the day, because if our credit rating goes down, interest
payments go up on everything from your mortgage, to your car, but, more
importantly, on America's debt, which means we are going to have borrow
more money to pay the interest on the debt we already owe.
So we cannot allow our credit rating to go down. The three major
companies that give us our credit rating are all saying the same. Here
is what they are saying in plain English: The debt limit is a problem,
but it is the least of your problems. Your bigger problem is the debt.
If all you do is pass an increase to the debt limit and it does not
come with a serious, credible, substantial plan to deal with the debt,
you are in big trouble.
I would submit to you that the biggest issue facing us on this issue
is not the debt limit. The debt limit is actually the easiest issue.
That is one vote away from being raised. Our biggest issue is the debt,
and the fact is that as we speak, there is no plan in place to begin to
do anything about it. Our credit is in danger because of this. That is
what we should be focused on like a laser.
What will a substantial plan look like? Let's take it from the words
of these credit companies: It has to stabilize deficits and begin to
show how the deficits come down. We know that $1.5 trillion in cuts is
not enough. We know that $4 trillion might be enough.
This is what we need to do. How do you do this? How do you get there?
It is not rocket science. It is a pretty simple mix of two things that
have to happen. The first thing you have to do is you have to stop
spending money at the rate you are spending. You cannot keep spending
more money than you have. If you are in debt and you keep borrowing a
lot more money than you take in especially, it is only going to get
worse. So you have got to control the amount of money you spend. Also
what you have got to do is generate more money for government.
So if you can do those two things, if you can control how much you
spend and you can generate more money for government, and you can do
both things at the same time, that is how you dig yourself out of this.
The debate we should be having here is how do you accomplish that.
On the do-not-spend side, we have two choices: You can either trust
that future Congresses will do what virtually no Congress in the
history of this Nation has ever done; that is, control themselves. And
I say this when Republicans were in charge, Democrats were in charge;
they have never been able to control spending. If you let politicians
spend money they do not have, they will spend it, I do not care who is
in charge. That is what history teaches us. So we can either trust that
somehow in the future Congress will not do that or we can put into law
limits on their ability to do that.

That is why I am for things such as a spending cap and a balanced
budget amendment, because I think if you do not have restrictions in
place, it is not going to happen. Almost every State in the country has
a balanced budget amendment. I come from a State where there is a
balanced budget amendment.
I assure you, I do not care who is in charge or how conservative they
claim to be. If you do not have laws in place that keep politicians
from spending money they are borrowing, they will borrow the money and
spend it. History will back that up.
The second is, how do you generate more money for this controlled
government? That is the crux of the debate we are having today. Some of
my colleagues believe the way you do it is you raise taxes, especially
on rich people. To some people this may sound appealing. Here is the
problem. It does not raise nearly enough money, if you could even
collect it. It does not raise nearly enough money.
From the only tax plans I have seen put out there by the
administration and some of my colleagues here on the other side of the
aisle, it adds up to less than 10 days' worth of deficit spending. We
do know, however, that these increases in taxes could kill jobs.
The other way you can generate more revenue for government--and it is
the way I think we should do it--is to grow your economy. You get more
people back to work, and so now more people are paying taxes. You get
people who are working to make more money because their businesses are
doing better and so they are paying more taxes. The government uses
that money not to grow government, it uses that money to pay down its
debt and control itself. How do you create more jobs and economic
growth? You do it by encouraging people, not in this building but
outside this building, to start businesses or grow existing businesses.
If you ask those people--not economists, not people on Wall Street,
not journalists, not professors, not politicians--if you ask people to
create jobs: What would it take for you to start creating jobs again,
what they are looking for is a tax system that is fair and regulations
they can comply with and then get out of the way and they will do what
Americans have always done. Those are our ideas.
Here is the problem. Even as we stand here today, there are few plans
on the table to do it. I have watched the President give press
conferences. I have watched the President give speeches. I have yet to
see a plan from the President. With all due respect to my colleagues in
the other party in the Senate, I have not seen a plan from them either.
They are the majority party. They control this Chamber. They control
the Senate. I have not seen a plan from them.
A moment ago we heard this talk about we have to compromise. It is
hard to compromise when the other side does not have a plan. What do
you compromise on? Where is your plan? You cannot compromise if only
one person is offering plans. There is only one plan that has been
voted on by any House to deal with this issue, and it is the one we are
on right now--cut, cap, and balance.
I would submit if you do not like cut, cap, and balance, if you do
not think we need to cut spending, cap spending, and balance our
budget, then show us your alternative. Or maybe you do believe we do
need to cut, cap, and balance, but you do not like the way this bill
cuts spending, caps spending, and balances spending. Fine. Offer your
version of cut, cap, and balance. Let's proceed to this bill. Let's get
on this bill the House has passed. If you do not like it, change it.
You have got the votes here to do it. If you have got a better idea,
bring this bill up and amend it and put your ideas on it.
But how could you ask for compromise? How could you scold Republicans
in the House for refusing to compromise if you do not have a plan of

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your own? How can a person compromise if they don't have any ideas of
their own? It is not a fair thing to say.

So I urge the leadership of the Senate and the President of the
United States to offer their ideas on paper--put their ideas on paper
and offer them so we can begin to work on this concept of compromise
they have offered.
We cannot compromise and negotiate with people who will not offer a
plan. Why don't we vote to proceed to cut, cap, and balance--proceed to
this bill so we can debate it and they can offer their ideas on this
bill. This is the perfect opportunity to do it. Stop negotiating in the
media and through press conferences and start doing it on the Senate
floor, which is what the people sent us to do. I hope that is what will
happen.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mrs. Hagan). The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. BROWN of Ohio. Madam President, I ask unanimous consent that the
order for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.

Nomination of Richard Cordray

Mr. BROWN of Ohio. Madam President, as we debate the best way to get
our fiscal house in order, we must avoid, first of all, defaulting on
our obligations while also working to make our economy stronger.
While our debt has been rising for several decades--and there is
enough blame to go around--it has been exacerbated by the economic
crisis that has all too often turned workers and taxpayers into
collectors of unemployment insurance, housing assistance, and health
care assistance.
We must not forget that the economic crisis was brought on by a
financial crisis that pulled our economy into a deep recession.
Some people in this Chamber--conservative politicians in Washington--
like to forget this financial crisis ever happened. But throughout the
United States--in places such as Cleveland, Dayton, Chillicothe, and
Zanesville--fast-talking mortgage brokers in America steered Americans
into unfair loans that helped put our economy on the brink of collapse,
costing millions of Americans their homes and jobs.
While Wall Street has regained its footing, millions of Americans are
still struggling to finds jobs, stay in their homes, and afford health
care coverage. Businesses are struggling to access credit so they can
hire new workers.
Thankfully, 1 year ago, we passed Wall Street reform. The President
signed the landmark legislation that was aimed at providing consumers
with protection from abusive rates, fees, penalties in mortgages and
credit cards.
The centerpiece of the bill--one of the centerpieces of the bill is
the creation of the Consumer Financial Protection Bureau, which is
aimed at giving consumers a voice as loud and powerful as Wall Street;
frankly, something this city is not used to.
Richard Cordray will be that voice. He is one of Ohio's most talented
public servants, who is strongly committed to protecting Ohio consumers
and investors.
As Ohio's attorney general, he was a strong voice for Ohioans who
struggled during these tough times to stay in their homes, consumers
who faced unfair practices by big Wall Street banks who had deceived
consumers.
He has targeted institutions--including Fannie Mae--that hid material
information from investors, in the process undermining pension funds
that provide retirement security for teachers, secretaries, police
officers, and janitors.
Coming from Ohio, he has seen firsthand how unscrupulous actors
steered Americans into unfair subprime loans that helped push the
economy to the brink of collapse, costing millions of Americans their
homes and jobs.
Rich took the unscrupulous actors, but he also worked closely with
Ohio banks, which are supporting his nomination to advocate the
Consumer Protection Bureau because he played it straight and fair. He
worked closely with them to promote financial literacy and craft
effective, targeted legislation distinguishing traditional banks--those
that lend and are the lifeblood of any economy--from those banks
engaged or those companies or Wall Street institutions that are engaged
in predatory lending.
As he has been throughout his career, Rich will be a strong voice for
consumers as the Consumer Financial Protection Bureau carries out his
mission. It is a mission of bringing oversight and transparency to
checking accounts, credit cards, mortgages and student loans and
ensuring that our financial system continues to support job creation.
The Consumer Financial Protection Bureau is already starting to make a
difference. It is working to make sure credit card terms and loan
contracts are written in ways that regular people can understand--in
plain English. It has earned rave reviews from industry and consumer
groups alike for the substance and process involved in creating a new
model mortgage loan disclosure form.
The Consumer Product Financial Protection Bureau is helping our men
and women in uniform, preventing them from being targeted by bad actors
committing fraud and engaging in deceptive financial practices. You can
see them like vultures surrounding military bases as they do it--at
Wright-Patterson Air Force base in Dayton and other places.
When Rich was attorney general of Ohio, he was the first State
attorney general in Ohio to take on unscrupulous bankers and sue a
mortgage lender over foreclosure fraud. He recovered billions of
dollars for Ohio.
I am proud to have worked with him to identify financial predators
that prey on homeowners facing foreclosure. When he was Ohio treasurer,
he worked across party lines to strengthen Ohio's finances.
Besides being a five-time Jeopardy winner, Rich is a great human
being and a devoted family man. The challenges he will face in his new
position are great, but I know he will be strengthened by the support
of his wife Peggy and twins Holly and Danny.
I urge my colleagues to support Richard Cordray to be head of the new
Consumer Financial Protection Bureau. It will help consumers, banks,
and our economy.
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. BROWN of Ohio. I ask unanimous consent that the order for the
quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BROWN of Ohio. Madam President, I ask unanimous consent that the
time during the quorum call be divided equally between the two parties.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BROWN of Ohio. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. WYDEN. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. WYDEN. Madam President and colleagues, I have been struck in the
discussion about cut, cap, and balance that there has been virtually no
mention--virtually no mention--of the No. 1 issue on the minds of the
American people, and that is jobs. What we need above anything else is
to create more good-paying jobs. In this discussion about cut, cap, and
balance, the whole question of jobs has virtually not come up.
Now, what we know is that between the worst of this fiscal crisis and
the end of 2010 we lost 8.5 million jobs, and our country has only
recovered a small portion of those jobs. The fact is, many of those new
jobs that have been created don't pay as much as the jobs that have
been lost. We also know millions of our people can't find full-time
work, and they have had to settle for part-time jobs to make ends meet.
Cut, cap, and balance virtually ignores that question.
I hear, for example, from our business community that they have a
very serious challenge in terms of generating sales. Sales are all
about middle-class folks coming into our stores and, in a consumer-
driven economy, making purchases. As we have seen a number of

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times, David Leonhardt--particularly over the weekend in an excellent
piece in the New York Times--described how in one area after another,
in terms of consumer durable goods, middle-class folks have essentially
walked off the economic playing field.
There is, however, one particular approach to job creation that has a
proven track record--a proven track record--and bipartisan support, and
it is one I hope the Congress will soon move to. I find that we have
plenty of disagreement now in the Congress on a whole host of issues,
but whether one is part of the Warner-Chambliss group or any other
particular group, there is a sense that even though cut, cap, and
balance doesn't talk about it, job creation is the most important
issue. The path to that--the proven path to that, Madam President--is
tax reform.
The fact is, that is the one unused tool in the economic toolshed.
The Federal Reserve has thrown tremendous efforts at trying to boost
the economy. The Recovery Act was a path. Various steps have been taken
with respect to housing. Tax reform is the one area from the economic
toolshed that has not yet been picked up and actually used. I think the
country understands what needs to be done. Certainly, the Congress
does. We had the report from the Bush Commission--George W. Bush--that
made a number of excellent recommendations in their report. The Volcker
Commission for President Obama had a number of sensible ideas.
I have had the pleasure of working with two very thoughtful
colleagues on the other side of the aisle--Senator Gregg, before he
retired, and now Senator Coats--and we have picked up on the model that
populist Democrats and former President Ronald Reagan pursued in the
early 1980s. It was all about cleaning out scores of special interest
tax breaks and using that money to hold down rates for everybody and
keep progressivity.
The reason I bring it up this afternoon--in the context of the fact
that I sure don't see any mention of cut, cap, and balance focusing on
jobs--is when Democrats and Ronald Reagan got together, the results on
job creation were real, they were tangible, and we saw middle-class
people get a chance to get back into the economy and get back to work.
According to the Bureau of Labor Statistics, in the 2 years after
Democrats and Ronald Reagan got together on a bipartisan basis to focus
on job creation, our country created 6.3 million new jobs--6.3 million
new jobs. Between 2001 and 2008, when tax policy was partisan, we only
created about 3 million jobs. We have lost jobs in this last fiscal
crisis, looking particularly at the measure that I cited at the end of
2010. So we have to get people back to work.
I see my friend from Iowa is here, and we have talked about tax
reform on a number of occasions. Let me just cite an example of an
approach on which Senator Coats, a Republican, and I have teamed up. We
take away the tax breaks for shipping jobs overseas.
Right now, there are a huge array of tax breaks for, in effect,
exporting jobs, when the country wants to export goods and services--
goods made in the United States, where we add value to them in the
United States and then we ship them somewhere. What Senator Coats and I
propose is taking away those tax breaks for exporting jobs and using
those dollars for what I call red, white, and blue jobs--jobs that pay
a good wage in the United States so we can get full-time employment for
some of the folks so hard hit now who can't find more than 15 or 20
hours of work a week that doesn't pay a good wage so they can support
their families.
Cut, cap, and balance doesn't raise those kinds of issues. It doesn't
raise the fact that when we put people back to work, have good-paying
jobs in this country, that generates revenue Democrats and Republicans
alike can support.
I know Senator Harkin has focused particularly on this question of
where the revenue is going to come from to pay for our safety net with
so many people hurting and falling between the cracks; tax reform that
puts middle-class people back to work as we saw when Democrats such as
Dick Gephardt and former President Reagan got together that generates
revenue both sides can support, private sector job growth that puts
folks back to work and gets the middle-class consumer back into the
economy and back into our stores.
Look, for example, at the bipartisan proposal Senator Coats and I
have. The typical middle-class person can get $3,000, $4,000 worth of
tax relief under our proposal, not by raising the deficit, not by
spending more money, but by closing out some of these special interest
loopholes. Where is that consumer going to go? They will have a chance
in a consumer-driven economy to go back into the stores. Maybe they
will buy a washing machine, maybe they will buy a computer for their
kids. They will go back into the economy and help, as we have seen time
and time again over our history, to get our country back on its feet by
middle-class people who have good-paying jobs going back into the
marketplace and helping our economy grow.
The numbers are striking. Again, after Democrats such as Dick
Gephardt got together with Ronald Reagan, in the 3 years after those
reforms in the middle 1980s, Federal tax receipts for individuals and
corporations rose by $137 billion. That is the kind of revenue-raising
approach that Democrats and Republicans alike can support. But we don't
hear a word about job growth in the private sector under cut, cap, and
balance.
We hear a lot of technical terms about whether Federal spending ought
to be 19.9 percent of gross domestic product or should it be 20 or 21.
Those are important issues, but to their credit, one economist after
another has made it clear that we don't get to economic recovery in
this country just by cutting. We are going to have to do some growing.
Colleagues, we are going to have to do some growing. And, to me, to
be out on the floor talking about cut, cap, and balance and not paying
any attention to a Tax Code that is a job killer rather than a job
creator for what I call red, white, and blue jobs in this country just
seems to be a mistaken set of priorities.
The reality is, as Senator Coats and I have made clear in offering
our bill, the Tax Code is larded down with so many special interest
goodies and sweetheart deals, and I just touched on one that we would
actually be rewarding: the export of good American jobs. What we ought
to be doing is taking away these foolish tax breaks and creating ones
that get the middle class back into the economy and get our companies
investing in our country.
Now, it does not take a constitutional amendment to do what Dick
Gephardt, Ronald Reagan, Dan Rostenkowski, Bob Packwood, and a whole
host of Democrats and Republicans got together to do in the 1980s. It
requires Democrats and Republicans to work together to take on the
special interests that currently benefit from the broken tax system.
Make no mistake about it. Those special interest groups are taking
tax breaks that ought to instead go for real relief for hard-hit,
middle-class families and American business to create jobs in this
country.
I see colleagues on the floor. I want to wrap up with one last point,
briefly. I would not say for a second that tax reform is the only
component of economic recovery. Senator Blunt is here, and as chairman
of the Trade Subcommittee on the Finance Committee, we have worked very
closely together on another important trade issue. What we have seen--
and I know Senator Harkin is interested in this--is the Chinese have
essentially been involved in merchandise laundering--some companies.
What they have done after they have been found guilty of violating our
trade laws, instead of changing their practices and complying with the
trade laws, some of these Chinese outfits essentially go to another
country and export through that country, and put on, for example,
``Made in Korea''--big implications with these trade agreements--and
end up shipping those goods to the United States.
Senator Blunt and his constituents have made the correct point that
is again taking away jobs from middle-class folks. But we have to get
back to the issue of jobs on the floor of the Senate. That is the most
important question for our constituents.
Staff told me on the way over here that in a recent survey of
businesses

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cites, again, their No. 1 concern is that sales are going down in their
stores. I think everybody in the Senate knows you can often go to a
store on a weekend or an evening and you hardly see anybody there
because middle-class people are very worried about what is ahead and
simply because of these economic times do not have the money to go in
and buy those goods and arrange for those services that, in an economy
that requires they be in the marketplace, they simply don't have the
resources for it.
So I hope my colleagues will oppose cut, cap, and balance. I hope
they will see the No. 1 issue in the country is jobs. Tax reform has a
proven track record, colleagues--a proven track record: 6.3 million new
jobs in the 2 years after Ronald Reagan, a conservative President, and
Dick Gephardt, a populist Democrat, got together--a conservative
Republican President, a populist Democrat. That is the tool we ought to
take out of the economic toolshed and use as quickly as possible.
I hope we will move on certainly to tax reform in the fall, and I
hope colleagues will remember that as we have this discussion about
cut, cap, and balance. I think it misses the central question of our
time, which is job creation. For that reason, I oppose the bill.
Madam President, colleagues are on the floor. With that, I would
yield.
The PRESIDING OFFICER. The Senator from Missouri.
Mr. BLUNT. I thank the President for recognizing me, and I will speak
and then look forward to hearing the remarks of my good friend from
Iowa.
I agree with the simple premise of what Mr. Wyden had to say. I think
private sector job creation should be the No. 1 target for the country
today. Frankly, anytime we are not talking about that or what we can do
about spending, we are talking about the wrong two domestic issues.
I would suggest, however, it is not like the option today was to
bring that bill he described to the floor. I would love to see it on
the floor. I would love to see a simpler, fairer, flatter more easily
understood Tax Code because I do think certainty is one of the things
that makes a difference in that decision to invest. But I absolutely
agree the No. 1 priority for the country at this minute should be
private sector job creation. And I look forward, as he does, to working
on that.
My only fault I find with the premise that is not the reason to talk
about this is that is not what we were going to be talking about
otherwise. In fact, the week we were going to spend here that was
supposed to be the workweek during the Fourth of July, the bill the
majority brought to the floor was the Libya resolution, which I haven't
seen since.
That was the week we were here to do something about spending, and
that is why we didn't do the other things we had scheduled because we
were going to talk about spending. The bill the majority was going to
bring to the floor was the Libyan resolution, which was the most
important thing in the world, apparently, that day, and we haven't seen
it since that day.

So while I agree job creation matters, I don't agree that it doesn't
matter how much the Federal Government spends. In fact, I think there
is a lot of difference in a country where the Federal Government is
spending $1 out of $4 that the country can produce in goods and
services, or $1 out of $5. Now we are spending $1 out of $4.
For 40 years, before 2008, we spent $1 out of $5. In 2008 we didn't
spend an average of 20.6 percent; we spent 19 percent. So we have gone
from 19 percent of GDP spent by the Federal Government to 25 percent of
GDP spent by the Federal Government, and it matters. That is why
spending is the other issue.
What we are talking about with cut, cap, and balance is, How do we
get that spending under control? If there is a better plan, I would be
glad to see it. But I don't see a plan on spending control coming from
anywhere else.
We all know we now have a record debt of almost $15 trillion, at
$14.3 trillion and counting. We all know we have spent approximately
$7.3 trillion and added almost $4 trillion to that debt since the
Senate and President Obama passed the last budget the country had 813
days ago. We all know unemployment has increased by 18 percent since
January of 2009.
In the 29 months since then, despite the so-called stimulus package,
unemployment has been over 8 percent every month for 29 months, and it
was 9.2 percent in the month of June. We also all know that 40 cents
out of every dollar the Federal Government spends is borrowed, and we
just can't continue to do that. One option might be to raise taxes and
think that 40 cents would come in. I am not for that because I don't
think higher tax rates necessarily produce more tax revenue.
Until 1981, for 50 years the highest tax rates had been 70, 80, or 90
percent, and people don't pay that tax rate. People definitely don't
take a chance and invest in that tax rate. But the fact that we know
maybe most of all is we can't keep doing what we are doing now. The
status quo is both unacceptable and unsustainable, and we have to look
at what it takes, as Senator Wyden said, to meet the No. 1 priority,
which is, What do we do that creates private sector jobs? I think
getting Federal spending under control is something that the moment,
the moment of August 2, creates an opportunity for us to talk about and
do.
Now, why was I one of the first cosponsors of cut, cap, and balance?
It is because I thought it had the potential, and I believe it has the
potential, to do what needs to be done.
What was ``cut''? Cut was to go back not to 1980 spending levels, but
to go back with nondefense discretionary to 2006--just to go back to
what we were spending on nondefense discretionary in 2006. Rearrange
that as you may want to, rearrange that in a way that better meets 2011
goals, but go back to that amount of money and then set caps.
By the way, in virtually all cases they were growing caps in various
categories of government spending for the next 10 years and working
within those caps, but knowing every year what they were going to
spend.
Then, the third element was, let's balance the budget. While I have
always been for a balanced budget and a balanced budget amendment, I
believe now more than I ever have that it is the tool that ensures, not
just 5 years from now, but 55 years from now that we just have to
simply get the resources of government and the spending of government
in place. Forty-nine States, including my State of Missouri, have a
balanced budget amendment. Every family at some point or another has to
deal with the reality of a balanced budget amendment. These provisions
take us in the right direction.
President Obama has said he would veto this bill if it passed. It has
already passed the House. If it would pass the Senate this week, I
don't know that the President would veto it if he really was faced with
those options, but he said he would. I guess we might have to test
that. But we shouldn't not vote for this because the President said he
is going to veto it. We should vote for this because it is the right
thing to do to get the spending of the Federal Government under
control.
Missourians deserve better. Americans deserve better. Both parties no
doubt have contributed to where we are right now in our current
economic situation. Frankly, both parties have to find a way out. It
takes three things to pass a bill in Washington: It takes the House of
Representatives, it takes the Senate, and it takes the White House. My
party, the Republican Party, controls one of those. Our friends on the
other side control the other two. So how do any of us think we are
going to get everything we want in this environment? But we have to
work toward the right result. I think cut, cap, and balance would
produce that result. I think we do have to get on with the work of
being focused on what do we do to create private sector jobs, what do
we do to get this spending under control.
American families have to deal with this all the time. It is time
their government dealt with it as well. I don't want to settle for
business as usual. We have a unique opportunity here. Are we going to
be like every other country, like Greece and Ireland and Portugal and
Italy and so many countries in the world today? Or are we going to set
out on a different path, a path that shows we are prepared to control
and rein in Federal spending and do what is necessary to encourage
private job sector growth? I hope we can join together and find a
solution. This is the moment we need to do it.

[[Page S4756]]

Madam President, I am looking forward to working with you and others.
I know I am yielding the floor to my good friend, Senator Harkin from
Iowa. We are working together on the Missouri River working group. We
are sponsoring legislation together for Special Olympics. We can find
solutions to these problems if we want to find solutions. That is what
the people we work for deserve. Let's find a way forward.
For me, the way forward would be cut, cap, and balance but I do know
we all have to work together or we are not going to arrive at any
conclusion.
I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa.
Mr. HARKIN. Madam President, I listened both to Senator Wyden and to
the remarks of Senator Blunt. They are both very thoughtful
individuals, thoughtful Senators. I enjoy working with both of them.
Madam President, why are Republicans refusing to agree to raise the
debt ceiling, something we have done 89 times since the 1930s,
including 18 times under President Reagan? I might point out, the
Republicans at that time controlled the White House and the Senate and
the Democrats controlled the House.
Also, in September of 1987, President Ronald Reagan used his weekly
radio address to urge Congress to increase the debt ceiling. He said--
and here it is. I thought it was worth printing out. Here are the exact
words of Ronald Reagan spoken in September of 1987:

Unfortunately, Congress consistently brings the Government
to the edge of default before facing its responsibility. This
brinkmanship threatens the holders of government bonds and
those who rely on Social Security and veterans benefits.
Interest rates would skyrocket, instability would occur in
financial markets, and the Federal deficit would soar. The
United States has a special responsibility to itself and the
world to meet its obligations.

I didn't put it on here, but President Reagan went on:

It means we have a well-earned reputation for reliability
and credibility--two things that set us apart from the rest
of the world.

Today, so many of our friends on the other side, Republicans,
constantly invoke Ronald Reagan as a role model, almost as a kind of a
patron saint. I wish they would heed his words and what he said in
September of 1987.
I also remind my colleagues when President Reagan realized that his
1981 tax cuts were resulting in large deficits, he turned right around
and supported corrective income tax increases in 1982 and 1984. That is
right, President Reagan supported income tax increases in 1982 and
1984. In stark contrast to President Reagan's example, today
Republicans reject any compromise that requires raising any new
revenues from the wealthy.
One of the things we are talking about is eliminating tax
expenditures. Those are special interest tax breaks that even Senator
Coburn, on the Republican side, described as ``corporate welfare.'' As
the distinguished chair of the Budget Committee said in his remarks
earlier today, Senator Conrad pointed out that tax expenditures now
total more than $1 trillion, more than all of our discretionary
appropriations in the Federal budget.
Here is the difference. The discretionary appropriations for the most
part go out for programs such as health, education, research,
transportation, security, police, the judiciary--it goes out for that.
What do tax expenditures go out for? They go out to support the
wealthy. Here is why I say that. The wealthiest 1 percent of Americans
get 26 percent of the benefits from these tax expenditures. That is
what Senator Conrad pointed out this morning.
Many of our Republican friends are perfectly willing, indeed eager,
to slash Medicare, Social Security, Medicaid, education, other programs
that undergird the middle class. But they have made it clear they would
rather default on the debt than agree to a compromise that requires
shared sacrifice from the most privileged people in this country.
The legislation before us, which is called cut, cap, and balance, and
which should be more fairly described, as Senator Conrad and others
have said, as cut, cap, and kill Medicare, this bill that is before us
now would enshrine in the Constitution a requirement that two-thirds
supermajorities in both the House and Senate vote to raise revenues.
Fifty-one percent could cut spending but it would take two-thirds to
raise any revenues.
What does that mean? It means as a practical matter that it would
permanently lock in the benefits of the current tax breaks for the
wealthy, such as the outrageous 15-percent tax rate for hedge fund
billionaires, and by building a firewall to protect tax breaks for the
wealthiest Americans, this legislation would shift even more of the
burden of deficit reduction onto the backs of middle-class Americans.
Really, it should be cut, cap, and kill Medicare. That is what it is
all about.
Let me take this a step further. In this bill before us that was
passed over here from the House, it would cap Federal expenditures at
18 percent of GDP. Where did they get that number? Is that an arbitrary
number? Why isn't that 18.5? Why isn't it 19? Why is it 18? I will tell
you why. That number has a purpose. The last time Federal spending was
at 18 percent of GDP was in 1966, right before Medicare kicked in and
started expanding. So, guess what. They want to roll it back to a point
in time before we had Medicare. This assault, now, on Medicare comes on
the heels of another Republican assault on Medicare. You remember the
Republican budget, the so-called Ryan budget. What was its centerpiece?
A plan to dismantle Medicare, replace it with a voucher system that
would require seniors to spend $6,400 additional out of pocket for
Medicare every year. It was basically the dismantling of Medicare,
turning it into a voucher system. That was the Republican budget.
So now we have a two-front assault on Medicare by Republicans. One is
the Ryan budget, kind of a frontal assault, if you will, to dismantle
it, turn it into a voucher system, and now we have the so-called
balanced budget amendment that takes an indirect backdoor approach. It
would simply defund Medicare. It would put the Federal Government in a
fiscal straitjacket and allow it to spend no more than we did in the
mid 1960s, before Medicare started. That is why it is at 18 percent.
I would say this legislation before us is also a direct assault on
Social Security, the bedrock of our American retirement system. It is
vitally important to the middle class of America, to ensure that
seniors are able to enjoy their retirement years without falling into
poverty or moving in with their kids. Social Security's modest benefit,
around $14,000 a year now, has become the biggest source of retirement
income for two out of three retired Americans.
Mr. BROWN of Ohio. Will the Senator yield for a question?
Mr. HARKIN. I am glad to.
The PRESIDING OFFICER. The Senator from Ohio is recognized.
Mr. BROWN of Ohio. Madam President, I thank the Chair. I heard what
the Senator was saying about Medicare. Am I right about this? I know
what some conservative politicians in this town think about Medicare.
In 1965 when Medicare passed, it was a lot of conservative Republicans
who opposed it. Later--I was in the House then. Senator Harkin was in
the Senate. But the first chance that Speaker Gingrich with the new
Republican majority had in the mid-1990s, they tried to privatize it.
Remember, Speaker Gingrich talked about it withering on the vine.

Am I right, with the Ryan budget they tried to privatize Medicare
again and the public rose up against it a few months ago, so is this
sort of a backdoor way of going after Medicare? They do not want to
acknowledge to their constituents they do not like Medicare because 90-
some percent of Americans like Medicare and benefit from it. This is
this sort of backdoor approach to put these limits on spending so it
will force the privatization and unraveling of Medicare and ultimately
Social Security and these programs we care about?
Mr. HARKIN. I think my friend from Ohio put his finger on it. Of
course it is. It is a backdoor approach. We all want to have surpluses.
We don't want to have deficit spending. So it sounds good: We will
balance the budget. Most people say that sounds like a good idea, let's
do that, without looking behind this cap they put in of this 18
percent. Eighteen percent is a number picked by the Republicans because
that would take us back to where we were in 1966, before Medicare
kicked in. It would throttle it, a backdoor approach as a way of
defunding Medicare and also as

[[Page S4757]]

a way of getting at Social Security, moving it to privatization, which
the Republicans never have given up on.
They started under Gingrich. My friend is right. I remember them
talking about privatizing Social Security. They have never given up on
it. They cannot do it frontally but they are trying to do it through
the back door.
Mr. BROWN of Ohio. If the Senator will yield again, imagine what
would have happened in 2003 and 2004 with the Senator in the Senate and
a lot of people all over the country--including a lot of Republicans
all over the country, but not elected Republicans, when we were
fighting the privatization of Social Security in 2004 and 2005--imagine
what would have happened if so much of Social Security had been turned
over to Wall Street. Imagine what would have happened if, in 2005,
people would have put all this money in Wall Street instead of their
secure lockbox, if you will, the Social Security fund, where nobody is
missing Social Security payments and people know what they are going to
get. It is predictable, it is always there and always will be. If we
put it in these private accounts, there goes the predictability and
there goes the solidness of Social Security, right?
Mr. HARKIN. Another thing we ought to think about, I say to the
Senator, is this: What the Republicans are saying--there are a lot of
Republicans who do not care if we default. They don't care if we
default. In fact, Michelle Bachmann, Congresswoman Bachmann--who is one
of their frontrunners for the Presidency--said she would never vote to
increase the debt ceiling no matter the circumstances. As President
Reagan said in 1987, it would mean that ``those who rely on Social
Security and veterans benefits'' wouldn't get their Social Security
checks, and that is exactly right.
People have to think about this. If we default, that means all the
people who have put their money into Social Security in the past, what
we are saying is you may have put your money in there and guess what.
We are not going to pay you. Is that what we want to do as a country?
Social Security is backed by the full faith and credit of the U.S.
Government--more than anything than Wall Street has ever gotten. Wall
Street can go under. The Senator is right, if we had put Social
Security in the stock market it would be in the toilet now. But we put
it into U.S. Government bonds because it is backed with the full faith
and credit of the U.S. Government. That is why we have to support
Social Security. That is why we can't support this cockamamie scheme
they are trying to do here.
I thank my friend Ohio for pointing those things out. It is a
backdoor assault on Medicare and on Social Security. People are saying:
Well, Social Security--we have to shore up Social Security. It is sound
for about the next 20-some years, but looking ahead, yes, we should
shore up Social Security. One good way to do it is to raise the cap on
Social Security taxes. Well, right now the cap is $106,800 a year. What
does that mean? That means if you make up to $106,000 a year, you pay
into Social Security on every dollar you earn. If you make over that,
you don't. Well, let me put it another way. If you make $50,000 a year,
you pay on every dollar you earn into Social Security. If you make
$500,000 a year, you only pay on every 20 cents of every dollar you
earn into Social Security. Why is that fair? Why is that fair that
someone who makes $50,000 a year pays on every dime they earn, every
dollar they earn, but someone who makes $500,000 a year only pays 20
cents on the dollar? If you want to shore up Social Security, raise the
cap on payroll taxes. Raise the cap. That is something no one is
talking about. What are they talking about? Cut benefits. Cut the
benefits. Well, we don't have to cut Social Security benefits in any
way. We just have to make it fairer in terms of how we raise the
payroll taxes.

As I said earlier, the bill before us would require a two-thirds vote
before we could even change that. So if we wanted to raise the cap on
payroll taxes on Social Security, it would require a two-thirds vote.
That means we would never get it done. That means, yes, at some point
we would probably have to start reducing Social Security benefits.
Well, again, as the Senator from Ohio pointed out, this is a backdoor
approach to dismantling Social Security.
Republicans are rejecting any notion of shared sacrifice. They demand
we dismantle Medicare, slash Social Security, slash education, cut
infrastructure--all those things that undergird the middle class. They
shred the safety net for the most vulnerable people in our society, as
Senator Wyden pointed out earlier, but they insist on shielding the
wealthiest people in our society from even contributing $1 to the mess
we are in.
Lastly, why are so many people here--to pick up on what Senator Wyden
said earlier--obsessed with deficit reduction to the exclusion of the
single largest priority we should have in this country: putting people
back to work. That is the most urgent deficit we have--the jobs
deficit. Senator Wyden spoke eloquently about that.
My friend from Missouri, Senator Blunt, talked about that too. He
talked about private sector employment. Well, something has to happen
to get that moving. It is not giving more tax breaks to the wealthy.
The old trickle-down theory, we tried that and it never worked. All
these big tax cuts we gave to the wealthy happened under George Bush
and a Republican Congress. Look at the mess it got us into. We have
been losing jobs for the last several years. Our jobs have been going
overseas. It put us in a huge budget deficit.
One of the things we need to do now is not to turn a chainsaw on
ourselves but to recognize that the Federal Government can be a
powerful force for stimulating the private sector. Again, one of the
things I think we need to do is to put more money into the
infrastructure of this country. We need to rebuild our roads, our
highways and bridges, and our sewer and water systems. We have hundreds
of billions of dollars needed to remodel and upgrade our schools all
over America. We need a new electric grid, a smart grid. We need to be
putting more into green energy so we won't be importing so much oil
into this country. There is only one place that has the power to focus
on that in a large, comprehensive way, and that is the Federal
Government. But then people say: We can't do that. We can't afford it.
We don't have any money. Well, they are right.
So there are two ways we can get these wheels of our economy going
again: We can either borrow the money or we can raise the revenue. I
would prefer that we raised the revenue. There is plenty of it out
there. The businesses in America are sitting on, I have heard, anywhere
from $1 trillion to $2 trillion that they are not investing. Well, if
they are not investing it, I know where to invest it. Let's put it out
there rebuilding the infrastructure of America.
Now, that is not the government doing the work; it is simply the
government providing the input so that the private sector can go to
work. It is not government workers out there who would be building the
roads, bridges, highways, remodeling our schools, and rebuilding the
new electric grid. No, this is the private sector doing it, but we can
marshal the forces from the Federal Government, marshal the power to
focus the funds in that direction to rebuild America, to make it a more
energy efficient, a better educated, a more innovative, technologically
competent future for our kids and grandkids. Once we start doing that,
then other elements of the private sector will take off because they
will see we have made a commitment to the future, the growth of this
country--not a dismantling, not a withdrawing, not a shrinking, but, as
Senator Wyden said, a growth. Once the private sector sees we have made
a national commitment to growth, they will start investing.
How many times do we have to learn that the investment we have made
in infrastructure has spun off into all kinds of private sector
entrepreneurship and jobs and new businesses or research, the money we
have put into research and how that stimulates the private sector?
How many times have you heard this old Republican line--I hear it all
time--the government doesn't create wealth, it consumes wealth. I hear
that all the time. Well, that is nonsense.
Just about a month ago, I had a hearing before my committee, the HELP
Committee, which has jurisdiction over the National Institutes of
Health. We

[[Page S4758]]

had the National Institutes of Health here, and Francis Collins, who is
now the Director of it, brought us up to date on what the NIH is doing.
He pointed out something very interesting. Some 20 years ago, we began
to invest taxpayer money--your money, taxpayer dollars--into something
called mapping and sequencing the human gene. It was called the Human
Genome Project. It became the Human Genome Institute at NIH. After 12
years, they finished the process of mapping and sequencing the human
genome.
The Battelle Institute--a research institute that is privately owned,
not government, based in Ohio--did a study of what happened because of
that. We invested $3.8 billion in mapping and sequencing the human
gene--$3.8 billion. The Battelle Institute said: In the last 8 to 10
years, that $3.8 billion of taxpayer money invested in research
resulted in over $790 billion of private sector investment. Let me say
that again: $3.8 billion of taxpayer money resulted in $790 billion of
private sector investment. Tell me again that the government can't
create wealth. Of course, it can because it can marshal the kinds of
resources that this sector or that sector can't do. No private entity
could have mapped and sequenced the human genome. Well, they probably
could have, but it would have taken 40 or 50 years to do it. It took
the massive power of the Federal Government to get it done, and in a
short period of time.
So, again, this is what we ought to be thinking about: How do we
create jobs? How do we put people back to work? I say it is by making
sure we have the revenue to invest. We can invest in our
infrastructure. I don't mean just the physical infrastructure, I mean
also the human infrastructure. That means education and job training.
I just saw a figure the other day. This year, we are spending--of the
taxpayer money--$14 billion training Iraqi and Afghanistan security
forces. That is for training, $14 billion this year. Yet here in
America, for all of our job-training and retraining programs for the
entire country--all job-training programs--we are spending less than
$10 billion. Do you think the American people think that is wise? Do
you think they don't know this? There is $14 billion going to Iraq and
Afghanistan to train their security forces while less than $10 billion
is going to retrain our workforce for jobs of the future.
Well, I see others have come to the floor, so I will wrap this up.
Deficit reduction is important--I am not saying it isn't--but it is
not the single most important thing right now. The single most
important thing is to put people back to work. As Senator Wyden said,
that will start to create the demand. It will spur more private
investment as the Federal Government begins to invest in the future of
this country. That is where we ought to be focusing. Once we get the
wheels going again, once we get people back to work and the economy
starts to grow, that is when we start to reduce the deficit. To just
focus on deficit reduction right now to the exclusion of putting people
back to work reminds me of when doctors used to put leeches on people
who were ill. It only made them more ill because it drained more blood
out of their system. And most times it proved fatal, as it did to our
first President, George Washington. Our urgent, No. 1 priority must be
to create jobs and put people back to work. We shouldn't just turn a
chainsaw on ourselves.
I look at this Republican cut, cap, and kill Medicare proposal we
have before us, and what I see is a budget predicated on fatalism--
fatalism and fear of the future. We need a budget that is predicated on
hope and aspiration, of putting our people back to work.
So put the ideology aside. Come together in a spirit of compromise
for the good of this country to have a balanced package--balanced--
spending cuts that will take place in the mid-and outer ranges of our
years and revenue increases now so we can take that money and start
putting people back to work rebuilding both the human infrastructure
and the physical infrastructure of this country.
I ask unanimous consent that the time from 2 p.m. until 5 p.m. on the
motion to proceed to H.R. 2560 be equally divided between the majority
leader and the Republican leader or their designee and that Senators be
permitted to speak for up to 10 minutes each.
The PRESIDING OFFICER (Mr. Coons). Without objection, it is so
ordered.
Mr. HARKIN. I yield the floor.
Mr. CORNYN. Mr. President, I would like to speak on the cut, cap, and
balance legislation. I plan to vote yes on Saturday morning to proceed
to this bill, and I urge my colleagues to do likewise. I would also
like to explain why I think that is important.
Most of us understand what this bill does. It cuts spending next year
by more than $100 billion. These are real savings and not smoke-and-
mirrors. It caps total Federal spending as a percentage of the economy,
and it puts us on a path to keep spending at 19.9 percent of our gross
domestic product. Right now, our Federal spending is at 25 percent of
the gross domestic product. Our revenues are at roughly 15 percent, so
there we have a 10-percent deficit totaling $1.5 trillion this year
alone. Of course, those cumulative annual deficits make up our debt,
which is now approximately $14.4 trillion.

This piece of legislation also links an increase in the debt ceiling
to passage of a joint resolution to balance the budget, and this is an
important amendment to the Constitution that is being proposed. I
believe we have amended the Constitution 27 times so far. This is a
process the Framers of our Constitution embodied in the original
document to allow Congress and the American people to amend the
Constitution as circumstances change. Clearly, it is obvious to anyone
who will look and pay attention that Congress has shown itself unable
to constrain its spending and live within our means and to spend only
the money we have as opposed to money we borrow from future
generations. As important, this constitutional amendment--this balanced
budget amendment to the Constitution--is not an extraordinary thing. It
may be for the Federal Government, but 49 different States operate
under a balanced budget requirement.
I support the cut, cap, and balance legislation because it meets the
three primary criteria I am using to evaluate proposals related to the
debt ceiling. The first of those three criteria is, No. 1, we must not
default. That is not an option. Also, we must not lose the Federal
Government's AAA credit rating. No. 2, we must not increase the tax
burden on job creators during a fragile economic recovery. This is not
just my position; this was the President's position last December when
the expiring tax provisions were extended for 2 more years. No. 3, we
cannot resort to smoke and mirrors in the hopes of somehow fooling
either the credit rating agencies or the American people that we are
serious about the spending problem Washington clearly has.
Cut, cap, and balance earned bipartisan support in the House of
Representatives, and I applaud the courage of those who crossed the
aisle to support this legislation in the House. I hope we see a similar
demonstration of bipartisan support for this proposal in the Senate.
I know some of our colleagues on the other side are dismissive of
this piece of legislation. I believe the previous speaker--I wasn't
here for most of his comments, but I did see his chart--is fairly
dismissive of this proposal. For those colleagues who are critical of
this proposal, my question for them is this: Where is your plan? Where
is your plan? To criticize what responsible Members of Congress are
trying to propose as a solution to a problem when they have no plan of
their own is irresponsible, in my opinion.
The House of Representatives passed a budget earlier this year but,
unfortunately, it has been more than 800 days since the Senate has
adopted a budget--800 days. That is approaching 3 years. When asked,
the majority leader, Senator Reid, said it would be foolish for the
Senate to pass a budget. I think he was saying that not because he
believes it is foolish to have a budget, but perhaps he thought by
attacking the House plan, while having nothing to propose on his
behalf, gained some marginal political advantage.
President Obama has ignored his own debt commission for months and
the debt problem. We know last December his fiscal commission, the
Simpson-Bowles commission, rendered a very

[[Page S4759]]

important report documenting in sobering detail the debt problem the
Federal Government has--unfunded entitlements, as well as our tax
system, which makes very little sense and makes us noncompetitive
globally. It is our corporate tax system which encourages--because it
makes economic sense--businesses here in the United States to create
jobs overseas where it is more efficient, it is cheaper to do so, and
where it affects their bottom line in a positive way. Why wouldn't we
want to encourage job creators to create jobs here at home by reducing
the disincentives and providing an incentive for job creation here in
the United States? Until recently, the President has shown very little
interest in that recommendation of his own deficit commission.
We know when the President proposed his own budget in February--this
is a budget never taken up by a Democratically controlled Senate either
in the Budget Committee on which I serve or here on the floor--the
President's own budget proposed in February would actually make our
debt problem worse, not better. That is why, when we had a vote on the
President's proposed budget a few weeks ago--not because our Democratic
friends proposed it and brought it up for a vote but because our side
of the aisle asked for a vote on it--it failed 97 to 0. None of our
Democratic colleagues saw fit to vote for the President's budget
proposal because they know it makes the problem worse, not better.
The President finally got engaged a few weeks ago. But the problem we
still have is we don't know what the detail of the President's proposed
solution to the plan is. He will not say publicly in detail what his
plan is. Unfortunately--and this is sort of the nature of the beast--
all the negotiations so far that apparently are still continuing are
behind closed doors. If there were a grand bargain to be, I am
confident what would happen is it would be rolled out on the floor of
the Senate or in the House at the last minute, without adequate time to
review it or to debate it or for the American people to read it and see
how it affects them and to give us feedback. We are representatives of
a constituency, and the 25 million people I represent in Texas would
like to have a chance to read it and then tell me what they think about
it.
We know so far the American people are in the dark about the
negotiations, and that is not a good way to do business. That does not
help gain public confidence in what Congress is trying to do in dealing
with a very serious problem.
Last week, I believe it was the Press Secretary at the White House
who actually said that ``leadership is not proposing a plan for the
sake of having it voted up or down.''
I think that is a bizarre statement. A person offers a plan because
they believe it offers a solution to a problem, not because of some
fear of having it voted up or down. That is, in fact, how our system
works. The majority rules. But, unfortunately, the President's
leadership style is captured perfectly in that statement, and I think
it sums up what is wrong with what is happening here in Washington.
I wish to remind my colleagues of the challenge before us, and it is
not the debt ceiling; it is the debt. I think those who think it is not
real are just whistling past our fiscal graveyard.
Here is what one of the credit agencies, Standard & Poor's, said just
this morning, according to Reuters. They said:

If an agreement is reached to raise the debt ceiling but
nothing meaningful is done in terms of deficit reduction, the
U.S. would likely have its rating cut to the AA category.

Such a downgrade would have an immediate effect on other securities,
as Standard & Poor's said:

We would downgrade the debt of Fannie Mae and Freddie Mac .
. . the AAA rated Federal Home Loan Banks, and the AAA rated
Federal Farm Credit System Banks, to correspond with the U.S.
sovereign rating. We would also lower the ratings on AAA
rated U.S. insurance groups, as per our criteria that
correlates insurers' and sovereigns' ratings.

What would be the impact if these credit rating agencies--which seem
to have an oversized influence on our lives but they are what they
are--what would be the impact of them downgrading the quality rating of
our national debt? We know it would yield higher interest rates for
American families, for small businesses, and for the U.S. Government.
In fact, we know interest rates are at a historic low now because of
Federal Reserve policy, primarily. Those low interest rates we may
think are a good thing and they have provided some glimmer of hope for
our struggling economy. But if they were as a result of a downgrading
of our debt by these credit rating agencies or by a default which, to
me, is unthinkable--just a 1-percent increase on the cost of credit we
would have to pay to people who buy our debt--just a 1-percent increase
over current rates would mean $1.3 trillion over 10 years.

So the results of cuts in the billions of dollars are chicken feed
compared to what the credit rating agencies could wipe out almost
immediately by downgrading our debt. This is what we are risking by not
dealing with this problem. This is what we are risking by political
gamesmanship rather than trying to work together in a bipartisan basis
to solve this threat to our country and to our future.
As the economist Larry Lindsey wrote in the Wall Street Journal last
month:

If interest rates rose to their historical average over the
next 2 decades of 5.7 percent, our cost of borrowing would be
$4.9 trillion higher over the next 10 years.

So we are left with the obvious question: How can we stop this
economic calamity? We can pass this cut, cap, and balance plan or the
President or our friends across the aisle could propose something they
consider just as serious and just as credible, but we have to do it
quickly. So this deadline of August 2 is one we should not flirt with,
we should not play with, we should not ignore. We have to deal with it,
and we can't just deal with it by raising the debt ceiling because as
we have seen from the credit rating agencies, that doesn't solve the
fundamental problem. We need to solve the fundamental problem of
unsustainable debt or our economic future will not be one of hope and
optimism, as the Senator from Iowa was saying earlier; it will be bleak
indeed, and it will be our fault.
I see my colleague from Kansas, and I yield the floor.
The PRESIDING OFFICER. The Senator from Kansas.
Mr. ROBERTS. Mr. President, it is my understanding I am recognized
for 15 minutes; is that correct?
The PRESIDING OFFICER. It is the understanding of the Chair, Senators
may speak up to 10 minutes each under the previous order.
Mr. ROBERTS. I see. If I hit 10 minutes, I might ask unanimous
consent for an additional 5, and seeing the smile on the Presiding
Officer's face, perhaps he will be conducive to that request. I also
wish to associate my remarks with the distinguished Senator from Texas.
Every generation confronts challenges. The greatest generation
declared victory over fascism and imperialism. The next generation
faced down an enormous competition between the United States and its
way of life based on free markets, private ownership, and free
expression on one hand; and the Soviet Union and its way of life based
on central planning, collectivization and police state control on the
other. Again, victory belonged to America and the free world.
A new generation in America has now come of age since the Soviet
system collapsed. It is a generation that too often, in my opinion,
takes for granted the hardship and sacrifice of our forebears. It is
this generation that must confront the crippling $14.3 trillion debt--
and climbing. We have met the enemy and he ``is'' us. The enemy today
is our unsustainable debt, as has been pointed out by speaker after
speaker on both sides of the aisle.
I am privileged to represent the people of Kansas and the people of
Kansas are rightfully angry over the endless posturing and all the
rhetoric and all the fingerpointing regarding yet another increase in
the national debt. That is right, another increase in the debt limit.
Here we are again trying to reach agreement. I wish the President and
the House leadership well in their current talks. I wish the Senate was
engaged. We certainly don't need to kick the can down the road any
farther.
We are faced with one issue; that is, to rein in spending. Let me
point out

[[Page S4760]]

that in 2 years, the debt limit was raised nearly as many times as it
was in 8 years under the previous administration. It should come as no
surprise that the American people in general, and those in Kansas in
particular, reject these current spend-thrift policies.
I, from the first, decided it was time to stand up to spending,
deficits, and debt. I am talking about the time when we were
considering TARP, and we went through that very difficult time when
many in the administration--the previous administration--indicated if
you did not vote for TARP you were taking a very dangerous road.
I must confess, I have written a lot of speeches down through the
years of public service I have been privileged to have. It is that old
line of somehow or other we have to set our fiscal house in order not
only for us but for our kids and grandkids. How many times do we have
to say that? How many times do we have to give the speech? I decided no
more during the TARP consideration. I voted no.
I remember the time when the administration folks came in to visit
with me to convince me to vote yes. I said: Can you explain to me what
a credit default swap is? I had not really heard that term before. They
could not. They said they did not have enough time to do that. I just
decided to vote no. I opposed TARP. I opposed the bailouts. I opposed
the stimulus. I opposed Dodd-Frank. I opposed ObamaCare. And I oppose
any increase in the debt limit without real, tangible cuts in
discretionary spending and meaningful, structural reform to mandatory
spending.
I do not challenge the intent of people who promoted all of these
things, but the result has been an incredible increase in our national
debt.
Remember the line: Did you read the bill?--that was the question
people got when they went back home, faced up to the folks back home,
especially with the health care bill. All of a sudden people became
aware of the regulations and all the problems--now we have a hurricane
of regulations pouring out of the Department of Health and Human
Services.
Now the question from folks back home is: Have you read the
regulations? If we add up the costs of regulations, for goodness'
sakes, clear back in 2008 alone it was $1.78 trillion in cost to the
American public. Figure that in regards to the debate about the
national debt. That was back in 2008. Think what it is today. It is
probably twice that amount. So, consequently, we really have a problem.
Now, since last November the President has spoken to this issue. As a
matter of fact, he has spoken rather continuously at the White House
and campaign rallies. The problem is, there is no specific plan.
I know Republicans in the House are getting a lot of criticism for
their plan. At least they have a plan. The cut, cap, and balance plan
has received, as I said, a lot of criticism, but at least it is there.
On the other side of the aisle we just do not find anything. There is
no specific plan at all. We call that in Dodge City: Big hat, no
cattle.
The President's first opportunity to put words into action came in
February when the White House submitted its budget request: $3.73
trillion. It was estimated to add another $1 trillion to the debt.
Obviously, that did not work. That proposal was defeated 97 to 0 in the
Senate. Not too many bills get defeated 97 to 0.
Then, all of a sudden, now, we got into the tax situation. Maybe if
we just got involved in a little more revenue enhancement--that is what
we call it here; it is called taxes back home. Taxing is not the
problem; the problem is spending money we do not have.
In May, the President's budget was, as I said, defeated. And rightly
so. So here we are, more than halfway through the calendar year, 2
months away from the end of the fiscal year, and still no budget from
this body--over 800 days. Meanwhile, we have met the $14.3 trillion
debt ceiling, and it is climbing. Rather than make meaningful cuts and
meaningful reforms--specific reforms--the White House and some in the
Senate want to increase the debt ceiling again.
Again, we have met the enemy, and he is us.
Mr. President, $14.3 trillion--it is a sum so large that it is
difficult to understand. Kansans with whom I visit and who call my
office express shock we have allowed it to get to this point. How did
we get to this point? Then, if, in fact, we kick the can down the road,
what does it mean in regards to--as the Senator from Iowa pointed out--
the faith and optimism in our country? What does the future hold for a
country that acts this way?
Paying down the debt should be bipartisan. What would Presidents
Truman and Eisenhower say of a $14.3 trillion debt? I think they would
be pretty harsh. Both Presidents had pretty tough quotes in regards to
fiscal responsibility. What we need in this Chamber, what we need in
Washington is a very strong dose of common sense and a sense of
purpose, as evidenced by previous Presidents when they put leadership
first.
Here are the facts. They are stubborn things. They are clear. We
borrow 40 cents for every dollar we spend. A lot of people hear that.
That is climbing. It is going to be 41 cents pretty quickly.
There is a lot of talk about tax breaks for corporate jets. Boy, am I
tired of that. I am tired of this class warfare stuff in regards to
saying: If we just apply taxes to a certain, small segment of the
economy, or maybe a big segment like oil and gas--the bad guys, the fat
cats--boy, if we get them, we can sure solve the problem.
Let's take corporate jets, which I would emphasize represents general
aviation. It is called general aviation because the general public uses
it. It is not all Hollywood stars. It is not all rich people using
these so-called corporate jets. General aviation--it is the people who
have to get from here to there because for 90 percent of our airports,
a commercial flight does not land there.
What if you have a plant? What if you are a manufacturer? What if you
are a farmer? What if you are a rancher and you have to visit several
places in the country at one time, say, 5, 6, 7, 8, maybe 30? That is
what general aviation is all about.
As a matter of fact, in the stimulus, the President recommended an
extension of this same tax depreciation schedule. Now he is blaming the
fat cats in regards to taking advantage of corporate jets. That is
nuts. What the left hand giveth, the left hand taketh away in regards
to this class warfare rhetoric. We make these jets in Wichita. They are
great airplanes, and they service the general public for the public
good.
According to Charles Krauthammer, the renowned columnist, if we
collect the corporate jet tax every year for the next 5,000 years, we
would cover only 1 year of the debt the President has run up--1 year.
The general aviation industry will persevere, but we have come
through some tough times. We are coming in on a wing and a prayer--that
old World War II song that is almost revered. So we will persevere. But
can't we end this class warfare business? My Lord, the President talked
about it six times in two paragraphs. As I say, again, that is the same
industry he tried to help in the stimulus.
Here is another fact: Every cent of taxpayer money is used to pay for
entitlement programs and interest payments on the national debt. All
discretionary spending is borrowed. That is where we are headed; that
is where we are at.
On average, we accumulate $4 billion in debt each day. It would cost
each citizen $46,000 to pay the debt off. That means a family with a
husband, wife, and two kids would owe $184,000. That is rather
startling to Kansas families. They do not have that kind of money. I
know perhaps some would say that is apples and oranges with the
function of government and the function of families, but it is a good
illustration.
We have gone over 800 days--I think it is 810 now--without a budget
in the Senate of the United States. During that time, this country has
spent $7.3 trillion. We have spent $439 billion in interest on the
money we have borrowed.
We do not have regular order. If Robert C. Byrd were here today and
sitting in that chair, he would be appalled. He would be making a
speech in louder terms than I am, with short sentences, and he would
point out we are not doing our duty.
It used to be that we would have a budget. Then we would have
appropriations bills. Then we would have the

[[Page S4761]]

committees of jurisdiction meet those budget demands, meet that number.
Then we would debate it on the Senate floor. Members would have an
opportunity to bring amendments. That is how we worked. We do not work
that way anymore. There is no regular order anymore.
What we do is bring up huge bills such as Dodd-Frank and the health
care bill, usually written in private, and then we vote on it. Then the
American public says: Have you read the bill? Then they say: Have you
read the regulations?

We have to restore regular order and restore the Senate back to the
Senate. People are fearful. The American public is fearful today. They
have a real, conscientious worry that America is not the same as it
used to be. Why is that? Because I think the American dream is that
every American youngster can climb on the ladder of success as fast and
as high as he or she can, with nothing government made or manmade in
their way. Regardless, they may stumble, hit their chin on a couple of
rungs, but, by golly, they get back up and they go right up again.
Not anymore. We have, apparently, a national agenda to level
everybody with everybody else. It is called social justice. Nothing
wrong with social justice except if it is an agenda to affect
everybody. We now have the President of the United States deciding who
is rich. It does not make any difference if a person does not make
anything 1 year and makes $250,000 the next year; he is rich--despite
his or her circumstances, family circumstances, or anything.
We have the national government, the Federal Government deciding
everything: light bulbs, what you eat, rural fugitive dust. When a
grain truck goes down a gravel road in Kansas we have the EPA worried
about it. No kidding. We have navigable farm ponds now, farm ponds
declared navigable waters. No self-respecting duck would even land
there.
We have regulation after regulation after regulation. I cannot talk
to any manufacturer, any business, anyone in Kansas where I have the
privilege of speaking without somebody raising their hand and saying:
Pat, what on Earth are you doing back there passing all these
regulations that really don't make any sense and are about to put me
out of business?
My reply to them: I am not a ``you'' guy; I am an ``us'' guy; and I
am sure trying to do something about that. I do have a bill on that, by
the way, and I encourage my colleagues across the aisle to look at it.
I will be talking to you personally.
These are all serious issues, but the most serious matter is the
national debt. At the rate we are going, in a few short years we will
spend more paying interest on the debt than on all discretionary
spending outside defense. Mike Mullen has said this is the biggest
threat to our national security: $14.3 trillion. He is right. His
comments echo the calls I receive every day from Kansans.
There is a lot of rhetoric going on now, and I understand that.
Perhaps I have added to it. If I have offended somebody, I apologize.
But let's all take a deep breath, if we can. Debate and posturing is
nothing new in this body. In American history, in the earliest days of
our Republic, it was between Alexander Hamilton and the Federalists on
one side and Thomas Jefferson and his allies on the other. The enmity
between these men was so obvious through vitriolic rhetoric. Much of
the mudslinging that occurred then would be considered out of bounds by
today's standards of political discourse.
Well, as the debate raged on between the early parties over the
drafting of the Constitution, it seemed possible that the great
American experiment would be over before it even began. Edmund Randolph
wrote to George Washington, who at that time had retired to private
life, and begged him to ``rescue America from the impending ruin.''
Washington rose to the occasion the way a leader does. He did it for
his country, for his fellow Americans. He showed leadership because it
was the right thing to do. In the end, a compromise was reached--yes,
it was a compromise--to have the Constitution as drafted by the
Federalists but with the Bill of Rights included as drafted by the
Jeffersonians.
Later, after being elected our Nation's first President, Washington
was dismayed over the continuous bickering between Hamilton and
Jefferson--not so much different than we are doing today--over a wide
range of issues: how to interpret the Constitution, the powers of
Congress, the relationship between the States and the Federal
Government, and the public debt--even then. Sound familiar?
Well, amidst the feuding, George Washington wrote to Jefferson and
said this:

How unfortunate, and how much is it to be regretted then,
that whilst we are encompassed on all sides with avowed
enemies and insidious friends, that internal dissension
should be harrowing and tearing our vitals.

That is pretty tough. That is the bottle we ought to drink from every
morning and stop to think about it.
The PRESIDING OFFICER. The Senator's time has expired.
Mr. ROBERTS. I ask unanimous consent that I may proceed for 2
additional minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. ROBERTS. Mr. President, since the founding of our Nation, people
the world over have looked to us as a beacon of light because of our
freedoms. Others have watched the great American experiment with a
perverse hope that it falls. We can only fail if we fail ourselves, if
we fail to balance the budget and bring down the debt.
America has always proven itself. We will meet any challenge and
confront any enemy. The enemy before us is our own fiscal
irresponsibility. It is time to stop talking. It is time to start
doing. It is time for the President to come up with a specific plan,
and in meeting with Republicans and Democrats in the House and the same
in the Senate, let's do our duty.
In some of the toughest early debates in our country, Americans were
fortunate to have steady leadership in keeping a hand on the wheel. I
hope Members of this Chamber and the current President of the United
States can look to character, to leadership, to love of our country to
guide us through these very trying times.
Every generation confronts a unique set of challenges. The challenge
we face today is the $14.3 trillion debt--and growing. I am so hopeful
we can close ranks and confront this enemy. We owe the American people
and our forebears no less than victory in this fight.
I yield the floor.
The PRESIDING OFFICER. The Senator from Wyoming.
Mr. ENZI. Mr. President, I ask unanimous consent to speak for 15
minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. ENZI. Mr. President, we have spent a considerable amount of time
discussing the debt and the deficit crisis this country is facing
during the 112th Congress. Although we have heard from the President
that we must raise the debt limit, neither he nor any of his Democratic
colleagues, with the exception of the three Senators in the Gang of 6,
have presented us with a concrete plan to rein in spending and get our
fiscal house in order.
Meanwhile, every day we are spending more money that we do not have.
While my Democratic colleagues continue to talk about the need to
increase the debt limit and get our fiscal house in order, the House of
Representatives has taken concrete action to make that happen. On
Tuesday night, 234 Members of the House of Representatives joined to
pass the Cut, Cap, and Balance Act.
The bill will put the country on a sound fiscal course at the same
time that it gives the President $2.4 trillion in additional borrowing
authority that he has asked us to provide. The problem we currently
face is that we are spending too much money and borrowing too much
money.
I agree with our colleagues in the House that it only makes sense for
us to increase the borrowing authority if we put the country on a path
where that borrowing will eventually end, even though it is a long way
out.
The Cut, Cap, and Balance Act takes a three-tiered approach to
finding the right fiscal ship. First, it provides some substantial but
reasonable cuts to spending immediately. The bill requires us to cut
about 3 percent in spending from the bloated Federal budget next year.
That cut amounts to more than $100 billion in spending next year.

[[Page S4762]]

The bill allows the House and Senate to determine where those cuts
are most appropriate. Because we recognize the need to cut in
appropriate areas, the Cut, Cap, and Balance Act ensures there are no
immediate cuts to Social Security, Medicare, veterans benefits, or to
our military colleagues.
At the same time we cut spending, the bill puts in place spending
caps that prevent us from spending above a specific amount and puts our
spending trajectory on a path where we can achieve a balanced budget.
We all wish we could balance the budget tomorrow, but we are spending
money at such an alarming rate that it just is not achievable. We are
almost borrowing as much money as we take in in revenue. The bill
recognizes that fact and gradually caps spending so we can achieve
balance.
Finally, the bill gives the President the ability to borrow an
additional $2.4 trillion he is requesting, subject to one condition:
that Congress passes a balanced budget amendment. We all agree we need
to stop borrowing so much money. The only way to stop borrowing is to
have a balanced budget--not spending more than we take in.
We have a pretty good idea how much is coming in and how much is
going out. That is why August 2 is the day of crisis, and that is
including the money we borrow. When we pay the interest, we have to
borrow 40 cents on every dollar to pay the interest.
If someone has a maxed out credit card and borrows to pay the minimum
balance, do you think they will ever pay that card off? Not a chance.
That is the situation we are in.
A balanced budget means we will not spend money we do not have.
Therefore, if the President wants to borrow $2.4 trillion more from a
country such as China, we need to know it will not force us to borrow
money forever. Cut, cap, and balance does not ask for the time for
States to ratify a balanced budget amendment after it passes. Their
time to ratify gives us time to get where we need to go.
Like families across America, we are going to have to decide what
spending is essential. Families have as many ideas for spending money
as the Federal Government does. But they know it is not an option to
spend what they do not have. They have to decide what is essential and
what is nice to have.
I think it is important to take a look at the problem we are facing.
If we grasp the size of the problem, we will share my sense of urgency
that we must pass the Cut, Cap, and Balance Act.
Our national debt is around $14.3 trillion. Our national debt is
almost equal to the whole economy of the United States--everything that
is produced and sold in the United States.
Our debt is almost equal to the whole economy of the United States.
We call it GDP. That is so we do not really know what we are talking
about. That means if we were to pay off the debt, every man, woman, and
child in this country would need to write a check for more than
$46,000. It would be one matter if that number were projected to
decrease or if there were signs that we are making progress in bringing
our budget back into balance. But that is not happening. Since the
President took office in 2009, our national debt has increased by more
than $4.4 billion each day, for a total increase of $3.7 trillion.
I can already hear the President counter that he had a lot to clean
up. At what point when things are getting worse instead of better is
the President going to take ownership and provide a solution on paper?
Lots of speeches, no paper.
The stimulus did not work, so let's not repeat it. If we keep doing
what we have been doing, we should not be surprised when we wind up
with what we already got--the same result.
Margaret Thatcher, when she was Prime Minister, proved that putting
your fiscal house in order increased the economy. They already tried
some of the other things, but putting the fiscal house in order is what
made the difference.
In 2011 we are expected to spend $3.6 trillion. At the same time that
we spend the $3.6 trillion, we will have revenues of $2.2 trillion.
That is a $1.4 trillion deficit. If we follow the President's budget,
we will have a deficit the next year of $1.2 trillion. The 10-year
average, if we follow the President's budget proposal, is nearly $1
trillion in deficits each year.
After his first term, the President's policies are expected to add
almost as much debt held by the public as all the Presidents in the
history of the United States. That level of deficit cannot be sustained
and, contrary to the opinions of my friends on the other side of the
aisle, we cannot tax our way out of this problem. Failure to
live within our means does not warrant taxing the taxpayers for
Washington's failures.

According to the Congressional Budget Office, the top 20 percent of
income earners paid almost 86 percent of all Federal taxes in 2007.
Those individuals are the job creators in this country. Many of them
are small business people who reinvest their profits, even though they
have to pay the taxes on them at that time. So they put the profits
back into their businesses to make them grow.
Increasing taxes at a time of economic struggle will cost jobs and
will lead to more unemployment and higher deficits. Businesses are
already reluctant to expand because of the increasing and detrimental
regulations coming out every day of this administration. Some of the
regulations are not even from current law, so they will be fought in
the courts and they will be overturned. But it will be at a great
expense, a great delay, because it will take over a 5-year period to do
that, and we will experience more pain than any cuts we might make.
Now, rather than increasing taxes, we need to cut spending and reform
entitlement programs. Mandatory and entitlement programs now account
for 62 percent of all Federal spending. That number continues to rise
as the baby boomer generation retires. By comparison, mandatory and
entitlement programs accounted for 33 percent of all Federal budget
spending in 1964--33 percent up to 62 percent.
The numbers do not lie. Entitlement programs are placing a
stranglehold on our budget, and yet there are still calls from my
colleagues on the other side of the aisle to keep them as they are.
Misinformation from campaigns and outside groups say there is not a
problem and we can fix our budget simply by cutting earmarks and
finding waste, fraud, and abuse. That is just not true. Even if the
money from the Social Security trust fund that has been spent were
returned, the length of time a person now lives makes the fund
actuarially broke.
These problems are too serious for us to ignore. Erskine Bowles, the
cochairman of the deficit commission, said it best when he testified
that ``we are facing the most predictable crisis in our nation's
history.''
Everyone knows we need to take action. Everyone knows we need to make
the tough choices necessary to right our fiscal ship. Yet there are
some who suggest we should not act or that we should wait to act.
To those Members, I say we have kicked the can down the road long
enough. It is time for us to take serious action to change the
trajectory of our spending habits and get this country in a condition
that we can be proud to leave to our grandchildren.
We have known that this debt limit debate was coming for months. We
can all see that the government is spending money at a rate that will
require us to authorize the Treasury Department to borrow more money.
Although the date shifted, the fact that the government will have
reached the debt limit should come as no surprise to anyone. That is
why it is so perplexing the President and my Democratic colleagues have
not presented any written plan to get the country back on track.
Well, I guess the President did present one. We voted on it, and it
did not get a single vote in this Chamber--not one vote. He did not
even talk one Democrat into voting for it. He had an outstanding
opportunity to talk about the deficit crisis that the deficit
commission pointed out. He could have done that in the State of the
Union speech. He could have followed that up with a budget that would
have mirrored what the budget commission said. That is kind of where
this Gang of 6 is right now with their suggestion.
But that did not happen. Instead, we move on to the crisis and figure
that just raising the debt limit will solve everything. We have known
it was coming for a long time.
In the House, Republicans passed a budget that would cut the spending
by

[[Page S4763]]

$5.8 trillion over the next 10 years. Senator Toomey and Senator Paul
in this body presented their own budget that would get our country back
on track. Senator Corker has introduced legislation that would cap
spending levels and head us in the right direction. I have introduced
legislation that would require us to reduce spending by 1 percent for 7
years and cap spending each year to balance the budget. It will work:
In 7 years, 1 percent.
Incidentally, that is probably how long it will take the States to
ratify the balanced budget amendment. If we are saying we can do it
without a balanced budget amendment, we should also pass my 1 percent
solution bill and prove that we can. A backup plan is always a good
idea.
Most businesses in the United States have to find a way to reduce
spending by 1 percent to match the economy or to do the regulations we
have forced on them. Most families have to find a way to spend one
penny less out of every dollar or face a financial crisis.
Why can't the United States do 1 percent--1 percent each year? By
making the 1 percent spending cut, we would save around $7\1/2\
trillion over the next 10 years, balance our budget, and we would put
the country on a sustainable spending path.
Republicans have offered all of these plans, and we continue to hear
only silence from the other side. The only plan presented by the
majority, as I mentioned, was President Obama's fiscal year 2012
budget, which was unanimously opposed.
When the President and the majority do not lead, some bill has to
take the lead. Members of the House proved that on Tuesday night by
passing a plan that allows the President to have his debt limit
increase and get our country back on track. The Cut, Cap, and Balance
Act is a responsible solution to the problems we face. We are spending
too much. Too much spending leads to too much borrowing.
To rein in spending, we must make immediate cuts that prove Congress
can act. We must cap future spending to ensure that our spending levels
do not grow at an unsurmountable level.
To prevent future borrowing, we need to put into place a mechanism
that will require us to balance the budget. Forty-nine States require a
balanced budget, and it is well past time for the Federal Government to
show the same fiscal restraint.
The President has asked us to give him the ability to borrow $2.4
trillion more, which our children and grandchildren will have to pay
back and, if the crisis worsens, it will move up to the current
generation. It is money we will need to borrow from countries such as
China, which are our competitors in the world and which don't
necessarily share the same values. I don't take that responsibility
lightly.
This responsibility requires immediate action to correct the problem
and prevent future generations from having to make the tough choices
our out-of-control spending has forced us to make. The House took the
responsibility seriously and passed the Cut, Cap, and Balance Act to
right our fiscal ship at the same time we give the President the
borrowing authority he so desires. The Senate should follow suit and
pass the Cut, Cap, and Balance Act immediately.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER (Mr. Sanders). The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. BARRASSO. 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. BARRASSO. Mr. President, I ask unanimous subsequent to speak as
in morning business.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BARRASSO. Mr. President, I come to the floor today because we are
discussing the cut, cap, and balance legislation, which I support. This
gets back to a poster I have had at home with my kids over the years. I
have a copy of it here. It is called ``the two penny difference.'' It
says that if you earn a dollar and you spend the 99 cents, you are OK.
But spend $1.01 and you are heading for trouble. This is from many
years ago.
Today, spending seems more fashionable than saving. What once was
called ``poor money management'' is now called ``deficit spending.''
Whatever it is called, it leads to inevitable headaches for people,
companies, and even for governments.
Frankly, that is the situation in which we find ourselves today, a
major headache, because as a nation we have continued to spend money we
don't have. As a result, we have been borrowing money, significant
amounts of money. Actually, it is about $4 billion a day. A lot of it
we are borrowing from overseas, and much of it from China. You say, how
does one maintain oneself as an independent, strong, and forceful
nation when it owes that sort of debt to someone else?
What the American people have told me as I traveled around my State
is that Americans believe--and the people of Wyoming clearly believe--
they want Washington to cut spending, not increase taxes. The White
House doesn't seem to hear that message. They are ignoring it, tuning
it out. They have admitted they don't have a plan to cut Washington
wasteful spending, and actually the President doesn't think he needs
one. I will quote the White House press secretary:

Leadership is not proposing a plan.

You know, it is saddening, but it is not surprising given this White
House's track record of changing positions, saying one thing and doing
another, and nobody can predict what they will do. Last week, the
President said he would not support a short-term increase in the debt
ceiling. He even warned the House majority leader: ``Don't call my
bluff.'' We have all seen it on television. Now we know it was a bluff.
The President is now saying he might welcome a short-term increase in
the debt ceiling. Yesterday, the President announced--or it was
announced by his spokesman--that they would consider the short-term
increase. So it is hard to tell what they are thinking at 1600
Pennsylvania Avenue. A lot of times it depends which way the wind is
blowing. White House officials aren't the only ones who think it is
better to not propose a plan. The story in Roll Call yesterday said
that the senior Senator from New York warned the Democrats to not
release a plan. The article even said they told the budget chairman not
to propose a budget because it would give others around the country
something to shoot at.
We have been here for over 800 days since a budget was passed through
the Senate, and a Senator tells the chairman of the Budget Committee
don't let them see the budget. According to this article, it said he
thought it was politically helpful to spend time ``attacking corporate
jet owners and defending entitlements.''
Our entitlements are going to be bankrupt in just over 10 years, and
some folks don't want to produce a plan to save them or to strengthen
them. That is what we are hearing on the floor of the Senate.
People often try to figure out how large this debt is that we have.
We spend more on interest on our debt--just interest--each and every
day than it would cost to buy several hundred corporate jets, which the
senior Senator from New York is railing against. And that is just the
interest alone on the debt. That is what kind of money we owe.
This isn't the kind of leadership America needs right now. Even
though the White House and my friends on the other side of the aisle
continue to send different signals each day, Republicans remain
committed to cutting spending. In fact, we put forward the only plan
that has passed either House of Congress. It is called cut, cap, and
balance. It will cut spending. The American people realize we continue
to spend money we don't have. It will cap future spending, and it will
require Washington to balance its budgets. Wyoming does that every
year. Every other alternative in the Congress, on the Hill, around
town, is either undefined or unfinished or only speculative.
I am pleased that the Senate will soon vote on cut, cap, and balance,
which is a plan that is good for our country. It is common sense that
when Washington is $14 trillion in debt, we must cut spending. When
Washington borrows $4 billion a day, we must cap future spending. When
Washington borrows $2 million every single minute, we must learn to
balance our budget.

[[Page S4764]]

Americans understand our country can't continue down this same track.
We cannot continue to spend money we don't have. Cut, cap, and balance
is the best plan for America.
I yield the floor.
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. REED. Mr. President, these are challenging and daunting times.
While we are coming out of the worst economic crisis since the Great
Depression, with continued high unemployment, our economy remains
fragile.
The fragility is not simply a macroeconomic phenomenon. It affects
every family in this country who is worried about their employment,
about the future of their children, and about whether their parents
will still enjoy adequate coverage under Medicare and will still be
able to draw some sustenance from Social Security checks. All these
worries are in the daily lives of all Americans. We have to respond to
that.
The most salient fact that affects most Americans is the dramatic
loss of employment, beginning in 2007, 2008, as the financial crisis
engulfed this country.
The U.S. economy has lost about 8.8 million private sector jobs just
in 2008 and 2009 alone. These were times when a Republican President
continued to accumulate huge deficit spending--most of it beginning
with tax cuts, which my Republican colleagues supported
enthusiastically; two wars that were not paid for, which was supported
overwhelmingly by my Republican colleagues; and an expansion of Part D
of Medicare, which again they supported. At no time did I hear the kind
of outcry about growing deficits we are hearing today.
We all understand that after the 10 years of this decade--8 of which
were under the Presidency of George W. Bush--we are in a very difficult
deficit position. That position is made worse because our economy has
not generated enough jobs. One of the aspects of all these so-called
plans--the cut, balance, whatever plan, and all the rest--should be the
answer to the fundamental question: How is it going to help us grow our
economy and grow jobs in Rhode Island, in Vermont, and in Wyoming? That
seems to elude all the proponents of these plans at the moment.
We have seen, since President Obama has taken office, some growth in
employment, with 16 consecutive months of private sector job growth--
about 2.1 million jobs--in sharp contrast to what was happening during
the last 2 years of President Bush's administration. But we have a long
way to go. Indeed, we have a long way to go to make up for the surplus
which President Bush and the Republican Congress inherited in 2001 and
the deficit and economic destruction President Obama inherited when he
took office.
Our most immediate and pressing business is to reach some principled
compromise on raising the debt ceiling--something that was done, I must
say, rather routinely under President Bush about seven times, even
though Democrats had very serious disagreements with him on tax
policy--a tax policy that was increasing the deficit--and disagreement
on wars, which were increasing the deficit as well as distorting our
strategy internationally. At no time did we try to use the debt ceiling
as the ultimate apocalyptic weapon to bring the President and, perhaps
in doing so, even the country down. Yet I hear too many of my
colleagues on the other side talking in those terms, particularly in
the other Chamber.
The bill that has been passed in the House is an attempt to shrink
government, protect the wealthy and special interests in the Tax Code.
It ties the debt ceiling increase to passage of a constitutional
amendment that would require 38 States for ratification. Once again, we
are taking what was routinely done and necessary so we don't default on
our credit and making it the vehicle for altering the Constitution of
the United States, of building in even additional protections in the
Tax Code for our wealthier citizens. This approach they are taking will
needlessly jeopardize Social Security, Medicare, and Medicaid, while it
enshrines in the Constitution further protections for loopholes in our
Tax Code and the tax benefits that many of the wealthy and the large
corporations enjoy today.
At the heart of what they are trying to propose in the House, and
what they have sent to us, is to make it easier to cut these vital
programs--a range of programs that involve transportation security
agents at our airports, flight controllers in the towers, and can even
involve the distribution of agriculture programs, which affect large
parts of our country--not so much in my State but large parts of this
country. All that would be subject to the calculation of cutting,
cutting, cutting, while it would be extraordinarily difficult to raise
revenues.
I don't think that makes sense. I don't think that is what the
American people want. From what I have seen from the polling, huge
numbers of Americans are frankly saying the wealthiest in this country
are enjoying huge tax benefits. I believe approximately 80 percent of
the American public believes the first step we should take in balancing
the budget is to raise the taxes on the wealthiest Americans. That is
what they are saying. They are not saying cut benefits from people who
are on the margin, who are struggling--the working poor, who may be
just under or over the line to qualify for Medicaid benefits in a State
and get health care for their children. I think the American people are
smarter and more decent than some of the proposals that have surfaced
around here.
Again, the caps on spending are all dressed up as if they will have
no real effect on the important programs, but they will have an effect
on every program, including Social Security, Medicare, and Medicaid.
For people who are still struggling to find work, who are still
struggling to find some type of traction in a difficult economy, these
cuts can be devastating. Indeed, one of the challenges we have is to
generate more growth in our economy again. When we pull back from
spending in the economy, that will further accelerate the lack of
demand and the lack of any incentive for private hiring.
We are already seeing companies cut back and cut back. What are they
saying? There is no demand. People aren't buying. People are saving.
They sense--not sense, they know--they have to save more because they
are not quite sure whether they will get all of their Social Security
check or their Medicare benefits or any other benefits. That drives
demand further down and slows the economy further down.
The Republican plan includes overall spending caps that reach 19.9
percent of GDP in 2017, but we have to look at this number in
historical perspective. Over the past 40 years, this rate of spending
is not only lower than the average spending but, moreover, outlays as a
percentage of gross domestic product have only declined to 19.9 percent
or lower when unemployment has been 6 percent or below. That makes
sense. When the American economy is working, people don't collect a lot
of benefits. They have a job and so they do not need the kind of
assistance they need today. This cap of 19.9 percent is totally out of
the context when it comes to the present unemployment rate of 9.2
percent and, frankly, could perhaps cause an even larger unemployment
rate if this program is enacted.
Again, I don't think this makes sense in terms of the simple
mathematics or the history or the underlying policies it would
inevitably produce in the country. Yet still, in this Republican
proposal, we are protecting the most special interests in this
country--Big Oil and corporations. Those tax breaks, those tax perks,
are still there, and they will continue to be there.
We all recognize we have to make tough decisions about spending and
about revenue. What I find acutely ironic is Democrats did that in 1993
and 1997 and we heard about it for years and years, with Republicans
assailing us. Of course, by 1998, we had a surplus. We had an economy
with an unemployment rate much closer to 5 percent than 10 percent. But
all that hard work--without any assistance from the Republicans--was
completely squandered beginning in January 2001. Now we are back to the
same challenge we faced in 1993 and 1994. But we did it before by
making tough decisions. We did it over several years. We did it by
trying to balance both cutting expenditures and increasing appropriate
revenue and also by recognizing that working Americans need the
assistance and support of their government. So we can do it again, and
I hope we do.

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But the first challenge--the one that has to be met--is to raise the
debt ceiling. Defaulting on our debt would have catastrophic
consequences. As we approach this deadline, the mere fact we haven't
done anything yet is prompting credit agencies to suggest they will
downgrade our credit rating. One of the most salient figures I have
heard in this debate is that for every increase of 1 percent in our
cost of credit and the interest we pay to borrow over 10 years, we will
add $1.3 trillion to our deficit. The longer we avoid raising the debt
ceiling, the closer we come to actually accelerating the deficit
dramatically by increasing the rate we have to pay to borrow funds.
The final point I would make is, raising the debt ceiling is not for
new spending we want to borrow money for. This is for the accumulation
of the deficit that began dramatically in January of 2001. So I would
urge my colleagues to move promptly and responsibly to raise the debt
ceiling and then to get to the hard, difficult work of balancing our
budget, as we did, as Democrats, in the 1990s, and then later, in 1996-
97, with a Republican Congress, further adding to the deficit reduction
under the leadership of President Clinton and not some magic plan that
is produced overnight.
With that, I yield the floor.
The PRESIDING OFFICER. The Senator from Alabama.
Mr. SESSIONS. I ask unanimous consent that the order for the quorum
call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. SESSIONS. Mr. President, one of the things that frustrates the
American people about Washington is how hard it is to get reliable
information and straightforward answers. We in the Senate and Congress
have that same difficulty. It is hard to know sometimes what numbers
and statements and plans mean and what they will cost. Politicians
offer a budget proposal and they say it cuts taxes even though taxes go
up. They even come up with new names to disguise tax hikes, like
revenue enhancements or reduced spending in the Tax Code. It doesn't
mean eliminating the earned income tax credit; it usually means some
deductions somebody is allowed to take, and that has been renamed as
spending.
We hear people come to the floor and blame our massive deficit on
anything and everything but our out-of-control spending, whether it is
the war in Iraq or it is a tax cut passed a decade ago, or it is
special preferences for private yachts or Lear jets. We can't have an
honest budget if we can't talk honestly and factually about it, and I
hope to be able to contribute in some way to clarifying the issues. I
will do my best today to plainly state some of the things I think are
plainly true.
First, I wish to address the myth that the President has a $4
trillion deficit reduction plan. Some believe that the President has a
plan to reduce spending by $4 trillion, but the only plan the President
has put on paper and allowed anybody to see is his February budget,
which doubles the national debt. The President has never put a single
spending cut plan on paper that actually reduces spending, and he has
no program that would substantially reduce the deficit. If he does, it
is a closely guarded secret.
His budget, which he submitted earlier this year, increases taxes
significantly but has greater increases in spending. By the
Congressional Budget Office analysis, it would increase the deficit
more over the next 10 years than if the budget were not passed at all.
Indeed, it would increase the gross debt of the United States by $13
trillion, doubling the entire debt of the United States again in the
next 10 years.
If there is a secret plan that does exist somewhere, it should be
made public this afternoon. Let's see it. I would like to. I think
millions of Americans would feel the same way. Summaries don't work.
The President summarized his budget, which I just described, as
calling on Americans to live within our means and will not add more to
the debt. That sounds pretty good, because this year our deficit is
projected to be $1,500 billion. So we want to be living within our
means again and we do not want to add more to the debt. But even by the
President's own analysis, the plan didn't do this. The Congressional
Budget Office, Congress's independent agency, analyzed the President's
budget and found that in 10 years, the lowest single annual deficit
that would occur would be $740 billion. The highest budget deficit
under President Bush was $450 billion. But under the President's
budget, the lowest deficit that would be accrued would be $740 billion.
It goes up in the outyears until it goes over $1 trillion, over $1,000
billion in the tenth year of his budget.
How can that be living within your means? It will not add more to the
debt? Every single year would be adding to the debt. So we can't deal
with summaries and spin statements about a plan until that plan has
been put in legislative language and scored.
We also have received no plan from our Senate Democratic colleagues.
For a time there a couple of months ago, the Democrats were on the path
of producing a budget in the Budget Committee as required by statutory
law. I, as ranking Republican, was very anxious to see it. We were told
we would get it the morning of the hearing, not a bit sooner. I
grumbled about that. I wanted to have a little more time to see it. But
we never received a budget. I think the majority leader and the
Democratic leadership, not our committee chairman, decided they didn't
want to have a budget. One of the committee folks said it would put a
target on your back. Senator Reid said it would be foolish to have a
budget. Why would it be foolish to have a budget? Well, you can't say
your budget calls on you to live within your means if you actually put
it out there. People can score it and find out whether it is true.
We haven't had a budget this Senate in 813 days. As of now, there is
only one debt limit plan on paper, only one plan available for public
scrutiny and review, and that is the one we are considering today, cut,
cap, and balance. It cuts spending immediately, it caps it so it won't
go up, and it requires the passage of a balanced budget amendment to
ensure that Washington ends deficit spending once and for all.
The American people do not support a Washington plan to pass some
grand deal with tax hikes that never go away and with spending cuts
that are talked about but never materialize. They are wise to the
gimmicks and accounting of Washington. They are not happy with us.
At this very moment the people's Representatives in Congress preside
over a country that borrows 40 percent of every dollar its government
spends.
People in the Tea Party are angry. And why shouldn't they be angry
when this kind of leadership has occurred in the Congress of the United
States of America? It is utterly, totally indefensible. It should
never, ever have happened. Yet, it has. It threatens our financial
future. It threatens our economy and our economic growth. So the
American people are not happy about it.
That is why I introduced a piece of legislation that would require 7
days to review any bill that would increase the debt limit, because
this is going to be complex. People want to bring it up at the 11th
hour under a panic mode. Some warn that if we don't pass it tomorrow,
the world markets are going to be destabilized, interest could go up. I
don't know, some of those things could happen. So we absolutely should
do something. But we ought to not wait until the last minute and have
plopped down in the Senate some big complex bill that has got to be
passed before the sun rises the next day and nobody has time to analyze
it or score it to find out what it means.
But our Democratic colleagues here in Washington are resisting the
cut, cap, and balance bill because there is no gimmick in it. There is
no accounting trick to get around if this becomes law. They know it
will work. And for the big spenders, the only thing you don't want to
pass is a piece of legislation that will work to contain spending. You
see, they want to spend more. They think if they continue to spend
more, then they can go and demand you raise taxes to pay for it.
Washington is going to have to end this spending spree. These kinds
of difficult choices are the responsible choices families, cities,
States, and county commissions are making every day, every year.
In Alabama, Governor Robert Bentley oversaw an across-the-board cut
of 15 percent from the general fund in the

[[Page S4766]]

current year because of the constitutional prohibition on deficit
spending. Alabama is not going to run up debt. For next year, he has
taken a cautious approach. Hopefully we will have more revenue, but he
is cautiously approaching next year and he has proposed cuts of up to
45 percent for some agencies that he felt would be appropriate places
to reduce spending. Those are tough choices. But unlike Alabama, the
Federal Government is not required to live within its means.
Another myth I wish to address is the idea that our current budget
crisis is the result of two wars and a tax cut. We have heard that over
and over again. The wars cost money, a good bit of money. Over the
entire decade, the cost of the Afghanistan and Iraq wars is about $1.3
trillion. That is a lot of money. Again, that is over 10 years, over a
decade. This year alone, the deficit is expected to be $1,400 billion,
or $1.4 trillion. The deficit this year will be larger than the cost of
the wars in Iraq and Afghanistan over 10 years. So the driving force
behind our deficit is not the wars in Iraq and Afghanistan. It is not.
War costs represent only 4 percent of total outlays over the last 10
years. The total amount of money spent since President Obama took
office is $8.5 trillion. By the end of his first 3 years in office, we
will have added $5 trillion to our gross Federal debt. These are
stunning numbers.
As I said, President Bush had a widely criticized--in many ways
rightly criticized--$450 billion deficit. Since President Obama has
been in office, the deficits have been 1.2, 1.3, looks like this year
it will be $1.4 trillion, each year, more than double the deficit under
President Bush.
We are borrowing close to half of what we are spending every single
day. In 2 years, nondefense discretionary spending increased 24
percent, 12 percent a year on average. This is our discretionary
spending. This isn't Social Security and Medicare, which increase more
than that. The stimulus package alone added into law the largest
expenditure bill in the history of the American Republic. It cost more
than the entire war in Iraq has cost. In a single day in 2009 we passed
it on this floor, over my objection, and every penny of it was
borrowed. We were in debt, but they said: The economy needs to be
stimulated so we are going to spend 850 or so billion dollars.
The spending when President Bush took office was less than $2
trillion. Today, it is almost $4 trillion. It will be almost $6
trillion by the end of the decade. There is only one honest answer to
the question of why our debt is rising so fast, and that is out-of-
control domestic spending.
Another myth that is circulating, which I wish to address, concerns
the outline from our colleagues and friends who participated and worked
hard on the Gang of 6 proposal. I give them a lot of credit and respect
for the hard work they put into it. I wish it had been produced a month
ago so we could have actually had legislative language and know what it
would mean today.
The authors of the summary, though, that they just produced for us,
claimed the approach would reduce the deficit by $3.7 trillion over 10
years. That is a little over one-third or so of the deficit we
projected to see in the next 10 years. But my staff on the Budget
Committee, taking the summary pages they produced for us, can only find
$1.2 trillion in reduced spending in that outline, along with what is a
very clear $1 trillion tax increase.
Where does the other $1.5 trillion in deficit reduction claimed in
the outline come from? Chairman Conrad, one of the members of the Gang
of 6 and our chairman on the Budget Committee, a man I respect and have
enjoyed working with, even said the outline has a $1.5 trillion tax
cut. But this is compared--this is how these numbers get bandied
about--it is compared against a baseline which assumes more than $3.5
trillion in tax increases would occur. So they are only going to
increase taxes, I guess, by $2 trillion, and you can get savings by not
having them go up as much. But based on the current tax rates that are
in existence in America today, as we read their outline--and I think
they would agree--it increases taxes by $1 trillion over 10 years. That
is a large amount.
The real cost of the tax changes, some who have looked at these
numbers say, is not $1 trillion but $2 trillion. That remains to be
seen. Hopefully we will get the legislative language that can actually
be analyzed, and we would know how much our taxes would actually go up.
The last myth I would like to address is perhaps the most important
of all, and this is the myth that we only need about $2 trillion in
actual spending cuts over the next 10 years. That has basically been
what our colleagues are saying. They float the idea of $4 trillion in
savings. What they mean is that you save $2 trillion by reducing
spending and you increase taxes $2 trillion and you have saved $4
billion over 10 years. I am not sure that is what the American people
are expecting of us when we say we are saving money. By taking it from
them? It is not saving the American people more. It is not saving the
private economy more, to take another $2 trillion from them. There is
no free lunch. Somebody pays.
Our Democratic colleagues have said, although no plan has ever been
made public to this effect, that they could get behind the budget deal
that reduces the deficit $4 trillion over the next 10 years, half of it
composed of spending cuts. This is not even close, frankly, to what is
needed to ultimately balance our budget. We are projected to spend $46
trillion over the next 10 years. A $2 trillion reduction is only about
a 4-percent reduction in spending, and that is set to increase by
almost 60 percent.
Remember, we will say we are reducing spending. We are not reducing
spending, we are reducing the rate of growth in spending by $2 trillion
on a $46 trillion plan. Think about it. We are not talking about
reducing spending. This budget would have the expenditures go up
significantly in the next 10 years to $46 trillion. The $2 trillion
means we are just reducing the growth of spending by $2 trillion. The
$2 trillion in tax increases would mean we would still spend the same
$46 trillion, but we just would borrow $2 trillion less because we have
extracted more from the American people.
In just a little over 2 months, our debt will reach 100 percent of
our economy--100 percent of GDP. That is the gross debt. That would
match the size of our economy. It costs us 1 million jobs or more a
year when gross debt reaches this level.
We have the Rogoff-Reinhart study that shows that when a country's
gross debt climbs as high as ours has, it starts pulling down economic
growth. Secretary Geithner said it is an excellent study. He said in
some ways it understates the problem we have. Secretary Geithner knows
this debt is a real problem for America.
We expected 3 percent growth the first quarter. It came in at 1.8
percent. Could that be because we have crossed the 90-percent debt-to-
GDP threshold, and that debt is now a burden on the economy that is
reducing growth? The experts have also downgraded the projected growth
for the third and fourth quarters of this calendar year. It is very
serious.
Christina Romer, who used to be in President Obama's White House on
economic matters, said 1 percent growth means you will add 1 million
jobs. So if our economy grows at 2 percent instead of 3 percent we will
fail to add 1 million jobs we could have added. And I truly believe the
debt is the reason we are having surprisingly low growth rates, below
projected rates. Maybe I am wrong, but we certainly have a study that
seems to say that exactly, and it has been widely praised by economists
all over the country.
The honest truth is that this President and his Democratic Senate are
not going to agree to the level of spending cuts in a debt deal that is
necessary to put our country on a sound path. I think that is a fact.
We have been negotiating and talking all year. The House laid out a
budget plan. The Senate has refused--813 days without a budget. They
are determined not to reduce spending after increasing domestic
spending, nondefense, by 24 percent. They say they will freeze
spending--freeze spending at levels that have jumped 24 percent? We do
not have the money. We are borrowing 40 cents out of every dollar we
spend.
Unfortunately, we're in a battle over the vision for the future of
America. It is a big-government vision a lot of our Members have, and
they are going to work as hard as they possibly can to preserve that
vision, preserve that spending. After running up this huge

[[Page S4767]]

debt by a 24-percent baseline increase--that does not count the
stimulus package of almost $900 billion that is thrown on top of that--
now they want to go to the American people and say: We are not going to
cut spending; you have to pay more in taxes. I don't think that is what
the American people want, so we have a national debate here.
This is the great debate of our time. It is not going to be settled
in 2 weeks. A few people are not going to meet in secret and work out
some grand and glorious deal. I wish they could, but I don't think they
will. I would be pleased if they do.
I am confident that the good sense and wisdom of the American people
will ultimately prevail. I am confident we will eventually get our
spending under control. We will restore the American principles of
limited government and build a better, freer future for our children.
We will raise the debt limit, but we will also put this country on a
sound path. If we get our debt under control, I think our economic
growth will rise quickly, and I believe we will see the progress we
have always seen in this great, productive, dynamic country.
I yield the floor. I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. BENNET. 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. BENNET. Mr. President, we have reached a point in this country's
history that I never thought I would ever see, which is that the major
credit rating agencies have all said that our credit rating is in
jeopardy and that the United States may face a downgrade of its debt.
You and I both have had our issues with the credit rating agencies
that failed to predict the crisis we were driven into by very poor
business decisions. I can't even really call them business decisions--
horrible decisions that were made that drove our economy off a cliff,
both here and in our financial markets, both in Washington among our
politicians and among people who securitized debt, sold it off, and
took no responsibility for it. Having said all of that, I don't think
these agencies have any political incentive other than to shoot
straight on this question of the condition of our debt.
One of the greatest assets we have always had as a country is the
steadiness of our credit. Countries and investors all over the world
use it to finance transactions that otherwise would be difficult to do
because we have an AAA rating on our debt.
Now we are facing a downgrade because we cannot even have an adult
conversation, a polite conversation about a path forward. People should
be very clear about what this means. This is not just a Washington
problem. If we blow through our credit rating and if our interest rates
rise by 1 percentage point--just 1 percentage point--that is going to
add $1.3 trillion to the debt over the next 10 years. If it goes up 2
percentage points, that is $2.6 trillion added to the debt over the
next 10 years. That means we will continue to pay our borrowers
interest and we will continue to underinvest in the children of this
country, in our infrastructure, in our research and development--in all
of what will allow us to compete in the 21st century. For what? Just to
pay higher interest rates to people because we could not come to an
agreement here in Washington.
I have spent the last 2\1/2\ years traveling around the great State
of Colorado, a State which is complicated politically, which I enjoy,
because we are one-third Republican, one-third Democratic, and one-
third Independent. If I had to boil down the essence of what I have
heard from people in my State about what they want us to be doing, it
is that they want us to approach this question the same way they would
approach this question. They want us to materially address the problem
we have. They want a material solution to it. They know we cannot fix
this overnight, a $1.5 trillion budget deficit and a $15 trillion debt,
but they want us to fix it. They want to know that we are all in it
together, that we all have a role to play to solve a problem that is
too big for any one of us to solve or any group of us to solve. They
want it to be bipartisan because they have no confidence in my State in
either party's go-it-alone approach.
I would add a corollary to all that: We need to satisfy the capital
markets that the paper they bought is actually worth what they paid for
it and that the United States of America is going to stand behind that
paper and is going to be able to stand behind the paper. This is one of
the reasons I have supported an approach the Gang of 6 has brought
forward--because it meets that test. It may not be perfect in all
respects. I know there can be disagreement about it. But that is one of
the reasons I have supported it. It is bipartisan, it is a measured
approach, and I cannot say the same for the bill we are considering
today.
Among other things, even if you thought this was a good idea, even
the proponents of the legislation say it would take 10 years before
this constitutional amendment would take effect. What we need to be
doing over the next 10 years is figuring out how to get our fiscal
house in order. I have other issues with it as well, but I think the
point I want to make today is we need to work together in a bipartisan
way to create a measured approach. You know what else. We cannot
declare victory then even when we are able to say to the credit
markets, you know what, we have had a disaster. This did not used to be
our standard as Americans.

I know I have heard the Presiding Officer on the floor many times
talk about the state of the American economy, and I agree with him and
his diagnosis. If I had to pick one fact over the last 10 years from
our economic life--and I see the Senator from Oklahoma is here, and I
will wrap up in 1 minute. What worries me the most is that median
family income has fallen the last 10 years for the first time in this
country's history. It stagnated for a while before that, but it has
fallen for the first 10 years. The average family income went up over
that period of time. Median family income has fallen and the cost of
higher education has skyrocketed, the cost of health care has
skyrocketed, and it is harder and harder for the middle class to get
ahead. Our economic production in this country is roughly the same as
it was before we went into this recession, but we have 14 million fewer
people doing the work because they are unemployed. We need to have a
set of tax policies, regulatory policies, that is driving innovation in
this economy and a policy to drive energy independence and make sure we
are fiscally responsible.
Before I leave the floor, I want to thank the Senator from Oklahoma
who is here today. He and I probably don't agree on most things--we
disagree about a lot of things--but I want to thank him and the other
members of the Gang of 6 for the work they have done. I want to thank
him and Dick Durbin, in particular--one of the more liberal members of
the Senate--for voting for the deficit and debt recommendations that
were made by the bipartisan commission that was appointed to the
deficit and the debt committee. It took real courage for him to do
that. It took real courage for Dick Durbin to do that. It is going to
take real courage for the 100 Members of this body and for the Members
of the other body to produce a plan to address this fiscal problem that
no one would agree with every single aspect of but that we can come
together and agree is worthy of the aspirations we have for our kids
and our grandkids.
Time is very short. If we trip over this debt ceiling and if we fail
to uphold the full faith and credit of the United States, no one is
going to be asking any one of us what pledge we made about this or what
pledge we made about that. They are simply going to observe when we
were 1 of 100 Americans--out of over 300 million Americans--we let the
unthinkable happen to this country.
I yield the floor.
The PRESIDING OFFICER (Mrs. McCaskill). The Senator from Oklahoma.
Mr. COBURN. Madam President, I wanted to spend some time talking
about what is coming forth Saturday morning. As a member of the Gang of
6, I am wanting us to solve our problem. But the best way to solve that
problem would be the bill that is going to be voted on Saturday
morning. Why is

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that? We are borrowing $4 billion a day, and I have enough gray hair to
know that regardless of all the good intention and regardless of all
the statements of the Members on the floor that we will never live
within our means in Washington until we are forced to live within our
means, and just because a constitutional amendment would take probably
4 years to pass--given what the American people think about it--isn't a
reason not to go on and do it no matter what we do about our short-term
problem coming up August 2. So the very fact people would say we are
not going to pass the Cut, Cap, and Balance Act because it won't happen
in a period of time is exactly the same approach that got us $14.3
trillion in debt, that has our credit rating at risk and puts us in the
kind of problems we have today.
I have offered a plan I think is even better. I know not many of my
colleagues will, but here is a plan to cut $9 trillion over the next 10
years. It is the only plan that specifically states what you would cut,
where you would cut it, and why you would cut it. It is backed up with
the facts. Nobody else can claim it. You don't have to like all of
them, but what we do know is if something doesn't come out of this body
between now and August 2 that cuts at least $4 trillion, this country
is going to see significantly increased interest rates as a cost of
that. What so often happens is you hear wonderful words and wonderful
speeches on the Senate floor but nobody putting their name on where you
would cut. Well, I put my name on $9 trillion worth of cuts. It pinches
everybody in this country. Everybody. But you know what. We are all in
this. We have lived for the last 30 years on the backs of those who are
going to pay the taxes for the next 30 years. It is time we start
paying back. It is time we start giving back.
The Senate is a different place today than when I came to the Senate.
When I came to the Senate, the idea was not to block legislation but to
discuss legislation, to have the courage and the backbone to vote
against something and go home and tell your constituents why you voted
against it, to offer amendments you thought would improve legislation
and defend those amendments, and to vote for a bill you thought was in
the best interest of the country and be able to defend that. What has
happened in the last 3\1/2\ years in the Senate is we don't vote
because the politicians of the Senate don't want to go home and explain
their positions. So if you are not voting, you are not accountable and
you are not responsible.
That type of behavior is exactly the opposite behavior we need to
have. So Saturday morning, when Members of the Senate vote against
proceeding to cut, cap, and balance, they will display either courage
or cowardice. I am not talking about simple words. There is only one
plan that has passed the House of Representatives that raises the debt
limit and addresses what is said to be needed by the rating agencies,
and that is cut, cap, and balance. And to not allow proceeding to that
debate whether you agree with it or not--you can change it through
amendments. You have the votes to change it through amendments. But to
not allow it to proceed so the American people can see their elected
Senators and their real positions and what they know has to be done--
you know, what happens around here is we say things so we can protect
our political careers. You know what that does? We are not only
bankrupting financially, we are bankrupting our country's history and
heritage. The heritage of this country was sacrifice, and that means
even sacrifice of political careers to do the right thing right now for
the country.
I believe if you were to pass something like this, we would lower our
debt by at least $2 trillion over the next 10 years, the economy would
absolutely boom, and we would quit undermining self-reliance and
enforcing dependency. We would hold accountable a Pentagon that is
wasteful, we would eliminate duplication of hundreds of programs that
all do the same thing with multiple layers of redundancy and
administrative bureaucracy. If we were to do that, this proposal will
never come to a vote in the Senate nor any of the aspects of it because
Senators don't want to make those hard choices, and that is what the
debate about cut, cap, and balance is all about. It forces Senators to
go back to embrace the heritage of this country and make the hard
choices. If you don't pass a balanced budget amendment and you don't
force the discipline, the political expediency of this country will
continue to run and the problems will not be solved.
I would also say raising the debt limit doesn't have anything to do
with our real problems. That is just the symptom of the problem. The
problem is not living within our means. Somehow thinking the U.S.
Government is different than all the State governments, all the city
and county governments, every family in this country, every business in
this country, and every other organization in this country that has to
live within its means, I refuse to believe the American people will not
hold Members of the Senate accountable for not giving them a chance to
put those fixed parameters on us and their government for the future.
We are going to hear all sorts of reasons why we can't do that, why
we won't do that, or we may not hear many at all. What we will see is
voting against the procedure with no comment whatsoever. My plan is if
that happens, to be all over this country to make sure every citizen of
every State of every Senator who does not allow them to proceed is
aware of that. I want to personally make them aware of that. Because
what you are doing is denying the liberty and the freedom of this
country to hold you accountable to do the right thing. So we are going
to see.
I wanted to spend a few minutes saying that the only thing that is
possible right now to solve the problems in front of us--even though I
have endorsed a $9 trillion plan and $3.7 trillion plan--the only thing
is this $6 trillion plan. It has passed the House of Representatives.
They voted to increase the debt limit and they put significant cuts
into our budget for next year. They put significant caps as we go
forward and they said we have to vote to pass a balanced budget
amendment. Right now that is the only thing that will get us out of a
jam. You know what. That is not hard to do. The first point, we are
going to cut another $111 billion at least next year, no matter whether
that passes. We are going to cap spending in the years that go forward
whether or not that bill passes. But the difference is as soon as we
get our balance again, the politicians who don't want to make hard
choices will be back to not making hard choices and we will get in
trouble again. That is why it is absolutely critical that this
country's citizens have the ability to hold us accountable within the
parameters of living within our means.
We will hear all sorts of reasons why we can't do that, that it might
hurt the poor. Nobody here wants to in any way intend anything other
than support for those who cannot help themselves. That is their
excuse, we can't do that. Well, let me tell you what is going to happen
in our country. The very programs that help the poor are going to be
diminished in the future through fiscal necessity when we are mandated
to make cuts to be able to borrow more money. So it is a false
statement because by not voting for a balanced budget amendment, what
you are saying is I want to plan one thing but I know something else is
going to happen.
I paraphrase a statement by Martin Luther King that I think describes
this place more than anything I have ever known and it was this: Vanity
asks the question: Is something popular? Cowardice asks the question:
Is it expedient? Character asks the question: Is it true and right? We
have tons of vanity. We have tons of cowardice. We limit ourselves on
courage and character.
As we listen to the debate over the next 2 days on this motion to
proceed on the only thing that will solve the problem in front of us
today, I want my colleagues to listen for political expediency, I want
my colleagues to listen for vanity, and then I want them to search hard
for courage and character because we will see an absence of it from
those who oppose this. They know this will solve the problem. They know
this is one of the few things that can pass the House of
Representatives. Yet we are not going to have it come to the floor for
an amendment process, for a full debate, and for a vote. We are not
going to allow it to have a vote because

[[Page S4769]]

we are political cowards. We do not want to truly address the problem
because it might affect our political careers. That is a sad commentary
on the heritage of this country--a sad commentary--but it is a
commentary to be expected; otherwise, we would never have gotten into
the position we are in today.
Let me talk about some details of what we can do. We are going to
hear all sorts of reasons why we can't do things and all sorts of
reasons why we couldn't come up with $9 trillion. But when the American
people truly know what is going on--if they go and read about it in
``Back in Black''--when they find out about the background of all the
waste, all the duplication, all the stupidity that goes on in our
government, all the lack of accountability, the lack of responsibility
in bureaucratic agencies, all the silly decisions that get made that
spend billions of dollars and don't help anything--the Tax Code. Tax
earmarks and tax credit and tax expenditures are nothing but, most of
the time, corporate welfare or socialism. The greatest tax in the world
comes when we allow the Federal Reserve to print money which devalues
our assets through inflation and the earnings on those assets. So the
greatest tax in the world that is coming in America is we are going to
devalue the dollar and inflation is going to go up and what we can earn
on our assets is going to be limited by the interest rates, and the
differential is that which we actually lose in real value of what we
own every day.
The other thing I would point out is, through the tax earmarks and
tax credits in our Tax Code, anybody who doesn't get one of those is
actually paying for it. So if a person doesn't have an ``in'' up here,
if a person doesn't have a lobbyist, if a person doesn't have some
special interest looking out for them and they are not getting one of
those, they are paying for them through the increased taxes. It is
inherently unfair.
Let's look at duplication for a minute. It is interesting to look, as
we have gone through the government programs in a detailed fashion, at
the GAO report. We have 100 different programs with 100 sets of
bureaucracies for surface transportation. Why do we have that? Because
Congress has mismanaged. That is why. Because of expediency, because of
vanity, because of wanting to get reelected, we create another program,
another program, another program. It looks good and sounds good, but
nobody ever does the research to see where they overlap. Nobody ever
requires us to ask if this program is effective, and nobody ever looks
at the Constitution to see if it fits with article I, section 8 of the
Constitution--the enumerated powers we are supposed to live by and
which we blow by all the time doing things.
Today, the Judiciary Committee passed a bill for State prisons called
the Second Chance Act. When we passed it the first time, I finally let
it go because it was supposed to be a demonstration and a limited
program. It is now going to get reauthorized for 5 more years. It
legitimately has zero role for the Federal Government, and we are going
to spend $600 million which we don't have. We will borrow. It is well
intended, but it is not our role. It is the States' role. We have
hundreds of thousands of examples such as that, where we have ignored
what the Constitution says so we can look good politically.
We have teacher quality programs. Teacher quality programs--82
different programs by the Federal Government to improve the quality of
our teachers. Thomas Jefferson was truly the father of education in our
country. He worked for years to establish the University of Virginia.
He was committed to the fact that a great education will produce great
benefits, not only for the individual with the education but for their
family and our country as a whole. Here is what he said: For the
Federal Government to become involved in education would require a
change to the U.S. Constitution, and he happened to be one of the
people who wrote it.
What have we done since the beginning of the Department of Education?
We have spent $2.6 trillion on education in this country at the Federal
level and every parameter measuring a metric on the progression of our
kids in school is worse or the same after that $2.6 trillion. Hey, it
is not working. The reason it is not working is a person can be a
teacher at home and the Federal Government looks at that person and
they don't know what to do, but we can hire that person to do the work
in Washington and all of a sudden that person knows what they need to
do. So we have this massive bureaucracy that has ruined our education
because we spend all our money filling out forms and requirements and
meeting mandates and we have taken the power and control of education
away from the parents and teachers, the very people who care most about
the success of the kids. So $2.6 trillion with nothing to show for it,
other than for the politicians to feel good about themselves and to say
we were doing something.
We have 88 different economic development programs, with $6 billion
just in four of them. Not for 1 of those 88 programs is there a metric
anywhere that says it is money well spent that gets a positive result
for the country. There is anecdotal evidence that says it worked here
or it worked there, but we don't know what we are doing. We are
throwing money we don't have at things we don't know are working and
when we go to vote for them to eliminate them, the Senate votes against
it because it might bother their political position. It might bother
their next election. We don't do it. We don't address it and do our
job.
I will never forget in one of the committees I was on last year, two
separate times bills were brought up in committee that were doing
identical things that we were already doing in the agencies. The
Senators and their staffs didn't know it. Had I not raised objections,
we would have created more agencies.
Eighty programs for transportation assistance--80. If it is our role,
why do we need 80? Oh, by the way, has anybody measured to see if any
of the 80 actually work? The answer is no. We have none that have a
report on whether they are effective to the goals of what they were set
out to do because there is no oversight carried out by Congress. We
were so busy earmarking for so many years, everybody forgot to check to
see if what we intended to do is working, and we still aren't doing it.
We have 56 different programs to teach the American people to become
financially literate--56. The Federal Government is teaching financial
literacy when we can't balance our budget. We have multiple programs.
We don't live within a confined budget. The first principle of
financial literacy is living within your means. Yet we have this many
programs--56--to teach American citizens to be financially literate.
Job training. Here is one of the best. This is great. We have 47 job
training programs that cost $16 billion a year. All but three overlap
one another. That is what the GAO says, and there is not a metric on
one of them to see if they are working. When we talk to the people who
go through the program, half of them say it is a waste, it is a joke. I
have actually talked to them. Yet we are spending that kind of money,
in excess of $15 billion a year, on job training programs. There is no
question we need job training programs, but we need job training
programs that work. Why would we need 47? So when somebody tells you we
can't balance our budget, you ought to blow a hole right through them
with your thought that says you obviously don't know what is going on
in the Federal Government.
Homeless prevention/assistance, 20 different Federal programs. We
should be helping people who need our help. I am not denying that. But
how we help and the mechanisms of the way we help ought to be frugal,
efficient, and effective.

I have served in Congress--I am in my 13th year, 6 years as a
Congressman, 4 years out of here to get a breath of fresh air, and now
my seventh year in the Senate. What I know is, we don't know what we
are doing, and it is obvious looking at our budget. It is also obvious
looking at the dysfunction of the Senate and the leadership in the
Senate, that we--we haven't had a budget in 2 years. The one thing any
financial counselor will tell you is the first thing you have to know
is where you are and set up a plan. We have had no attempt to bring a
budget to this body in well over 2\1/2\ years--no attempt. What does
that tell us? It goes back to vanity. It goes back to cowardice. It
goes back to

[[Page S4770]]

us not doing what we are intended to do because we care more about our
position than we care about the country.
There are 18 programs to feed the hungry. We have 17 disaster
response/preparedness, just in FEMA--17 different programs, of which 11
overlap. FEMA didn't set those up. The bureaucracy didn't create those;
we did. Every one of these programs was created by a Member of
Congress. So we can't blame administrations and we can't blame
Presidents. What we have to do is blame Congress.
We have 130 overlapping programs in the Department of Agriculture; 18
overlapping programs in the Department of Commerce; 230 overlapping
programs in the Department of Education; 17 in the Department of
Energy; 36 in the Department of Human Services; 32 in the Department of
Homeland Security; 60 in the Department of Housing and Urban
Development; 40 in the Department of the Interior; 53 in the Department
of Justice; 35 in the Department of Labor; 6 in the Department of
State; and 180 governmentwide if we look at all economic development
programs. We just listed the 88 that run through 4 of the agencies.
Is it any wonder we are going belly up? The problem is us. The
problem is we have a solution now that has come to us from the House
and we are not going to let that solution go forward because
politically--politically--it is uncomfortable. Politically, we don't
want to allow the people of this country to decide whether we ought to
live within our means and put a bridle with a bit in our mouth that
says, whoa, you are not going to continue to destroy the future of this
country and the prospects for our children anymore.
When I came to the Senate, I came after having read a book called
``Running On Empty.'' It was written by a man by the name of Pete
Peterson. He was bipartisan in his criticism of both parties, and he
was absolutely accurate. We are in trouble because parties matter more
than the country, because control matters more than the country,
because political careers matter more than our children or our
grandchildren.
So I go back to talk about what is possible. A lot of people would
disagree with what is in here; this $9 trillion of what the House has
sent us would take about 60 percent of it. But here is what I say to my
colleagues who don't want to vote on a balanced budget amendment, don't
want to vote on cut, cap, and balance. Where is your plan? I have
listed 625 pages of specific cuts, elimination of duplication,
elimination of waste, elimination of fraud, and 3,000 footnotes that
looked at every program throughout the Federal programs--looked at
every CRS report, looked at every OIG report, looked at every GAO
report, looked at every OMB report, and looked at every other outside
report we could find.
The fact is, we could solve our problems tomorrow, America. We could
solve them tomorrow, with good old-fashioned common sense that the vast
majority of Americans have and is sorely lacking here.
We do not have a fiscal crisis. We have a commonsense crisis in this
body and in the leadership in Congress. We lack common sense, we lack
sound judgment, and we need the hard bit of a bridle put on us through
a balanced budget amendment to control us. Because human nature is
human nature in whatever we do today, we will be back to our bad habits
tomorrow. Even if we pass cuts, even if we cap spending, if we do not
have a balanced budget amendment that forces us to live within the
constraints of our revenue, we will be back here again.
What does that mean? That means the future of America is suspect. It
does not have to be. We do not have to go the way of every other
republic. We do not have to fail over fiscal issues. We can cheat
history. The American people are the greatest people in the world
because they are a blend of all the people in the world and they desire
freedom and opportunity and that is limited because we have limited it.
We, through our profligate spending, our inattention to detail, our
failure to do oversight, have undercut the potential of our country.
Let's restore it. Let's restore it Saturday morning by moving on to
this bill and allowing ourselves to have a debate, offer amendments,
and truly debate--have what the Senate has not had in a year and a
half: a real debate about the issues of our day and the reasons behind
it.
But I would caution the American people. Remember what Martin Luther
King said as you hear that debate: Vanity asks the question, is it
popular? Cowardice asks the question, is it expedient? But conscience
and right and good asks, is it right?
I tell you, it is not right to have multiple programs doing the same
thing, wasting our kids' future. It is not right for the Congress not
to do oversight and eliminate programs. It is not right for us to spend
money we do not have on things we do not absolutely need. It is not
right for us to take the control of our children's education from the
parents and teachers who have their best interests at heart and place
it in a bureaucracy that has no compassion whatsoever, even though it
feigns that it does. It is not right. It may be politically expedient,
it may be popular to some people, but it does not make it right.
As you look at this, here is how you get $9 trillion, and you can
pick any part of that to meet this cut, cap, and balance or you can
come up with your own. But the fact is, nobody wants to lay on the
table what they think. I have already been roundly criticized in the
press for certain aspects of this by people who disagree. That is fine.
I am planning on defending everything I put in here. With the best of
my knowledge and a great staff that spent thousands upon thousands of
hours on this, we came up with a way to solve America's problems, and
we can do it.
America can be bright, can be growing, can be developing jobs, if we
get the government out of the way and limit the role of the Federal
Government.
I see my colleague from Delaware, one of my great friends. We hear
that said a lot here, but he is a great friend. It is not the
conventional, common greeting. I believe I am over my time. I will be
back to the floor to finish this conversation.
But America needs to know we do not have any problem we cannot fix.
What we lack are leaders who will fix it. That is our deficit. It is a
deficit of courage. It is a deficit of will.
With that, I yield the floor.
The PRESIDING OFFICER. The Senator from Delaware.
Mr. CARPER. Madam President, thank you very much for this time to
speak.
Before Dr. Coburn leaves the floor, I thank him for the kind things
he just said. As to Tom Coburn and I--a lot of people say: Well, that
is an unlikely duo who would end up working together as much as we have
and actually having the sense of trust and friendship. There are things
people certainly find in me not to like, and the same is true of all of
us. But I would say, there is nobody in the Senate who cares more about
getting our deficits under control. He and Dick Durbin have shown
terrific courage and leadership, along with others in this so-called
Gang of 6, and also as members of the deficit commission, in trying to
get us to a comprehensive, bipartisan solution as to how we rein in the
budget deficit without destroying our economy, making sure we do not
pierce the debt ceiling and have our financial world begin to crumble
around us. So I very much appreciate what he said today. I heard most
of it, not all of it. I have had a chance to work with him in a number
of areas.
What we try to do, and Senator McCaskill--who is presiding at this
moment--what she tries to do, along with others of us who serve on the
Homeland Security and Governmental Affairs Committee, is we try to look
in every nook and cranny of the Federal Government. Whether it is
defense spending, entitlement spending, domestic spending, we look at
the so-called tax expenditures, tax breaks, and so forth, and we look
at all of them and ask this question: How can we get a better result?
Whether it is health care, education, transportation, defense, how can
we get a better result for less money or how can we get a better result
for not much more money?
We need to do that across our government. We need to change, if you
will, the culture in the Federal Government from sort of a culture of
spendthrift--which a lot of people think we operate under--we have to
change it to a culture of thrift and not just for a couple

[[Page S4771]]

weeks or a couple months or a couple years; I mean for as far as the
eye can see, until these pages who are sitting in front of me--who are
rising juniors in high school--until they are rising juniors in college
and out of school and off into the world and well beyond that. That is
what we need to do. That is part of our obligation.
One of the recommendations--I am going to go back to over 1 year ago
when we voted on whether to create a deficit commission that would have
a number of members who would be responsible--some elected, some not--
they would have a responsibility to look across the Federal Government
and to come back to us at a date certain with ways to rein in the
Federal deficit to get us back on a more fiscally sustainable and
responsible track.
We voted in the Senate. Our Presiding Officer will recall not all the
folks who were cosponsors of the legislation that created the deficit
commission actually ended up voting for it. In fact, seven of them who
were cosponsors--as I recall, I do not believe any of them were on this
side of the aisle; I think they were on the other side of the aisle--
ended up voting against it, and we did not actually have the votes to
create the deficit commission.
With that happening, a number of us encouraged the President to use
his Executive powers to create one by Executive order. He did that.
Last year, the deficit commission was created, and there were 18 people
named to it. Madam President, 12 were elected, 6 were not, and he named
2 cochairs. One was Erskine Bowles.
Erskine Bowles, who is he? He used to be, in the second term of
President Clinton's administration, Chief of Staff for President
Clinton. Erskine was asked by President Clinton to negotiate the
deficit reduction package with the Republican House and Senate. At that
time, during those years, Republicans were in the majority in the House
and Senate. President Clinton said: Erskine, go out and negotiate a
deficit reduction deal, where some of the deficit reduction comes on
the revenue side and some comes on the spending side, so we can follow
up on, actually, an earlier deficit reduction package adopted in 1993
with only Democratic votes. But he said: Let's see if we can't actually
balance our budget. We had not done that since 1968.
God bless Erskine Bowles and the folks he negotiated with too. He
went to work in 1997 and came up with a deficit reduction package with
50 percent revenues, 50 percent spending that had everything on the
table. A long story short, we ended up with a balanced budget--not 1,
not 2, I think at least 3 years in a row at the end of the Clinton
administration and handed off to a new administration balanced budget
surpluses as for as the eye could see.
I remember Alan Greenspan testifying, I think, before the Banking
Committee, when Alan Greenspan was the Federal Reserve Chairman. He
said he was concerned at the time we were going to pay down our debt
too soon, too fast. I mentioned to him later that concern was misplaced
because we certainly did not pay down our deficit too fast. About
starting 10 years ago, we turned black ink surpluses as far as the eye
could see to red ink, to deficits as far as the eye could see.

A lot of people like to reinvent history. They say we did not do much
to reduce deficits in the years from, say, 1993 to 2000. Actually, we
had two big votes, one in 1993, with all Democrats--and I am not saying
this in a partisan way--and one in 1997, where the Republicans in the
House and the Senate actually negotiated in good faith with a
Democratic President. With those two packages together, with a strong,
robust economy, we balanced the budget not once, not twice, three
times, created something like 21 million new jobs, and ended up for the
decade ending in the year 2000 among the nations with a balanced budget
and the most productive workforce on the face of the Earth. Those were
halcyon days for our country. We need to get back to that.
So President Obama, naming the cochairs of the deficit commission,
goes back to an earlier President and taps the same guy, Erskine
Bowles, to be a coleader of the deficit commission.
On the Republican side, the President asked a guy a lot of people
remember, Alan Simpson, a Republican Senator from Wyoming, here for a
number of years, as maybe the funniest person who ever served in the
Senate. He is also one of the most insightful, commonsense deficit
hawks, and a great guy to be a partner with Erskine. They went
together.
We had 12 Members of the House and Senate--6 Democrats, 6
Republicans--and some other folks from civilian life. Dave Cote, who is
chairman and CEO of Honeywell, was among the private sector
participants. But they worked for months and gathered input from all
kinds of sources and came up with a broad-based plan that was
recommended, adopted, endorsed by, if you will, 11 out of the 18
Commissioners. That was not the magic threshold of 14 before it
actually would be the official recommendation of the Commission, but it
was a majority, and it included 3 Republican Senators: Judd Gregg, who
was then a Senator from New Hampshire, Tom Coburn, and Mike Crapo. I
thought they were courageous, those Republican Senators.
On our side, among them included Kent Conrad and Dick Durbin, and I
want to say Mark Warner, but I may be mistaken. Mark has been all over
this stuff. I think he has been a real leader, but I am not sure if he
was the third Democrat. Yes, the third Democrat was John Spratt,
Democrat from South Carolina, chairman of the House Budget Committee.
But anyway, those three Democrats and three Republicans basically
agreed to a package and said: Let's reduce the deficit over the next 10
years by $4 trillion. Let's do it mostly on the spending side--two-
thirds to three-quarters on the spending side--but let's have revenues
as well.
They did not propose raising the rates. What they actually proposed
was to reduce the rates for business, put us more in line with other
advanced countries, bring us down from about 35 percent to somewhere
roughly between 25 percent and 29 percent on the corporate income side,
to reduce personal income tax rates for middle- to low-income families
to as low as 8 percent, and to actually reduce the upper income rate
from somewhere in the mid thirties to the high twenties. But at the
same time we would bring down the rates. We would eliminate not all but
a lot of the so-called tax expenditures.
The tax expenditures--what are tax expenditures? They are tax breaks.
Some folks call them loopholes. Actually, a lot of them are
meritorious: the mortgage deduction, deductions that will encourage
people to make charitable donations, stuff that a lot of us will say:
We don't want to change that. We don't want to get rid of that. But if
you add all those tax expenditures over the next 10 years, do you know
what that adds up to? Madam President, $15 trillion. Think about that.
Add all the tax expenditures for the next 10 years, and it is $15
trillion. If we only were able to somehow reduce that by 8 or 9
percent, we would come up with the revenues that were called for in the
Bowles-Simpson deficit commission to be part of a $4 trillion package.
In order to be able to bring the rates down, to lower the rates,
broaden the base--in order to do that--we are going to have to take
more than 8 or 9 percent out of tax expenditures. They may have to be
reduced by as much as 50 percent.
I would argue, at the end of the day, we should preserve the
deduction for interest we pay on mortgages, especially for our primary
home. Also, to encourage charitable donations, I think we ought to
preserve the deduction for charitable donations. There are others as
well. But those are a couple of the good ones. But that was sort of the
sum and substance they came up with.
Among the things the Bowles-Simpson commission also said we ought to
have on the table for deficit reduction is entitlement programs.
What are entitlement programs? Things that we are entitled to by
virtue of our age, our station in life. If we are 65 years of age and
we have paid into Social Security and Medicare, we may be eligible--we
will be eligible, in all likelihood, for Medicare. If we are disabled
and totally unable to work, we will be eligible for Medicare even
before age 65.
If we paid into Social Security for a number of years, we would be
eligible for early retirement for Social Security at age 62. If we want
to take it later, we can take it at age 67 for full

[[Page S4772]]

retirement benefits, which I think are roughly about $2,000 per month
max, something like that.
Medicare and Medicaid, Social Security are entitlement programs. They
said they should all be on the table. They did not propose using Social
Security to balance the budget. But they did say: We have a long-term
problem in Social Security with an imbalance between now, the amount of
money that is coming into Social Security, and the amount of money that
is going out.
As the baby boomers are starting to retire--my generation--we are
paying out now, for the first time in a long time, more in Social
Security benefits than we are raising. The reason is, for today it is
roughly, for every one person receiving Social Security benefits there
are about 2\1/2\ people working. Before long it will be for every one
person receiving Social Security benefits, it will be two people
working and paying into Social Security. The mismatch of inflow into
the Social Security trust fund versus the outflow is going to get worse
not better.
Sometime, a couple of decades down the road, we are going to start
running out of money to pay 100 percent of Social Security benefits. We
will not have to stop them all together, but we will have to get them a
pretty serious haircut. I was a freshman Congressman, sworn in on
January 3, 1983. The day I was sworn in at the other end of the
Capitol, they told all of my freshman class: We are going to run out of
money in Social Security. That is what they said.
We said: Well, when? In a couple of decades or when?
They said: No. This year. This year.
We said: Are we going to provide a haircut, reduce Social Security
payments?
They said: No, we are going to stop making them because we are
running out of money in the Social Security trust fund.
That was where we were on January 3, 1983. Thanks to the good work of
the commission led by Alan Greenspan and others, but the good work they
did then, they handed off to us not just a problem but a solution.
Their solution was a combination of new sources of revenue for Social
Security and some reductions in benefits, gradually raising the full
retirement age over a period of 25 years from 65 to 67; requiring what
people pay into Social Security, State and local employees, among
others. A balanced plan.
Ronald Reagan, then President, provided political cover to Democrats
to vote for that. Tip O'Neill, then Democratic Speaker of the House,
provided cover for the Republicans to vote for that. Almost everybody,
House and Senate, Democrat and Republican, drank the Kool-Aid and voted
to preserve Social Security. It preserved it for another 25 years. We
did not have to stop paying Social Security benefits that year or the
next year or the next year after that. We had a significant surplus
that has gone up in the Social Security trust fund.
But now it is beginning to be paid down. But the fund is going to be
going in the wrong direction in the years to come. Over time the
outflow will increase as my generation retires. The question is, Do we
wait until the 2020s or 2030s to do something about it? I do not think
we should. I swore, 28 years ago, I did not want to hand off to the
next generation the problems we should solve today.
We have an opportunity not to use Social Security to balance the
budget, but actually under the plan that has been now sort of reworked
from the Bowles-Simpson deficit commission, the opportunity to secure
Social Security for the next 75 years, and to do it in a way that
involves a number of, I think, relatively modest changes, some new
revenues, and to gradually increasing the full retirement age from 67
to 68 by 2050, and from 68 to 69 by 2075.
Remember, when Social Security was first introduced, signed into law
by FDR back in the 1930s, a person had to be 65 years of age in order
to receive Social Security benefits. The average life expectancy then
was just over age 60. Think about that. Back then a person had to live
to 65 to draw benefits. The life expectancy for most people under 65
was between 60 and 65.
We are talking today about a life expectancy closer to 80. People
still get early benefits for early retirement benefits under Social
Security at age 62, but to gradually increase the full retirement age
and make a couple of other changes as well that on the surface do not
seem to be major changes--in fact, I think they are relatively modest.
But when we put them all together over many years, it is a lot of
dollars and a lot of people.
We can put Social Security on a safe footing for another 75 years.
The idea is to actually kind of wall that off from the rest of the
problems so we are basically preserving Social Security for a lot
longer, for my lifespan and the lifespan of these young pages who are
about 16 years of age, throughout their lifetimes as well.
On Medicare--let me talk about Medicare, health care for people 65
and over, people who are totally disabled under the age of 65 and are
unable to work. We will spend this year about $550 billion in
Medicare--about $550 billion. The amount of fraud in Medicare--Eric
Holder, our Attorney General, tells us that fraud each year from
Medicare is about $60 billion. That is roughly 10 percent of the amount
of money we spend in Medicare--$60 billion. Roughly 10 percent.
GAO keeps track of something else that is called improper payments.
One of the things GAO does is tell us every year how much we are making
in improper payments in our Federal Government across the board. They
said last year improper payments were about $125 billion. That is
different from fraud. That is just overpayments, accounting mistakes,
that sort of thing--$48 billion in improper payments for Medicare, and
another $60 billion, according to Eric Holder, just from fraud.
If those numbers are true, $60 billion out of $550 billion in
Medicare payments, that is actually more than 10 percent. Well, let's
just say it is only 10 percent or close to 10 percent.
How are they doing over in the private sector? How are they doing in
the private sector in terms of controlling their fraud? Well, their
fraud costs are not 10 percent of their costs. That is probably not a
surprise. They are not 9 percent. They are not 8 percent. They are not
7 percent. On balance, they are probably closer to 5 percent, and in
some cases less than 5 percent. Roughly half, their fraud cost, over
Medicare. Maybe they are doing something over in the private sector to
control fraud in ways that we can learn from in the Federal Government.
If we can learn those lessons, maybe we can provide better rules for
less money in Medicare.
Let me give you a couple of examples. Improper payments. Last year
Medicare had $48 billion in overpayments, mistakes, that kind of
thing--$48 billion--separate from fraud. The President said we are
going to cut it in half by the end of next year, from roughly $50 to
$25 billion. If we do that for 10 years, 10 years times $25 billion,
what does that add up to? $250 billion. That is real money around here,
one-quarter of a trillion dollars.
If Eric Holder, our Attorney General, is right on the fraud side, we
actually have $60 billion in fraud losses for Medicare in a year, if we
could cut that in half--and we put in the health care law, the new
health care law, all kinds of tools to do that kind of thing. If we can
cut that in half, that would be a savings of $30 billion a year. Over
10 years that is $300 billion--$300 billion in potential fraud savings,
$250 billion in potential savings by cutting in half improper payments
for Medicare. That is $550 billion. That is over $\1/2\ trillion.
For those who say we have to savage Medicare and Medicaid in order to
reduce outlays in them and achieve savings in Medicare and Medicaid,
that is not correct. That is not true. Let me give you a sense for
where some of the money is being lost in fraud.
I have learned a new term this last week called the ``death master
file.'' Maybe you have heard that term before but did not remember it.
But we are trying to keep track of the folks who are dying so that
we--when people die who are getting Social Security, we do not continue
to send out Social Security checks forever for people who are dead. The
same thing with folks who are eligible for other benefits, whether they
are benefits for--whether they happen to be educational benefits or
health benefits. We do not want to pay benefits for folks who, frankly,
are not with us anymore.

[[Page S4773]]

By the same token, we want to make sure that when doctors die, we do
not face the possibility that someone steals their provider ID number,
their Medicare provider ID number, or their Medicaid provider ID
number, if they have one, and write prescriptions for, among other
things, controlled substances. What we have today are crooks,
criminals, stealing provider ID numbers from dead doctors and using
those to write prescriptions for controlled substances, which then feed
the drug trade and provide profits to criminal groups.
The inspector general tells us in the most recent report in terms of
buying advanced wheelchairs, we spent almost $200 million a few years
ago. Over half of the payments did not meet the Medicare reimbursement
rules for the wheelchairs.
We have to be smarter than that. Over in Japan--I have my friend from
Florida sitting here waiting for me. He is cooling his jets, but he
will not do it for long, so I will close with this: As he knows, we
served together on the Finance Committee, and we used to serve together
in the House. He is an old friend and a good one. But as we wrestled
with health care reform legislation a year or two ago, one of the
things we heard in our hearings was, over in Japan--we compete against
Japan, friendly competition, but they are our competitor in a lot of
ways: electronics, cars, any number of products, we compete against
them. They spend about 8 percent of GDP for health care. We spend 16
percent. They get better results: longer life, longevity, less infant
mortality. They get better results. They spend half as much, they get
better results. They cover everybody. They cover everybody.
I would like to say, they cannot be that smart. As smart as they are
in Japan, they cannot be that smart, and we cannot be that dumb. There
are any number of ways that we can actually save money that does not
reduce benefits in Medicare or Medicaid. We can learn from some of the
things they are doing to uncover fraud and reduce improper payments in
the private sector and just navigate some of those ideas over to the
public sector, and find out what works.
I like to say--this was Alan Blinder's. Alan Blinder testified before
us a couple of months ago, a month or two ago, as the Senator will
remember.
Alan Blinder said: In terms of reducing the deficit, especially on
health care costs, he said: I am not an expert on this thing, but here
is my advice to you. Find out what works. Do more of that.
Think of that. Find out what works, do more of that. The converse of
that would be, find out what does not work, do less of that. If we do
that sort of thing, if we do it not just once or twice or for a couple
of weeks or a couple of years, but we just make that a cultural change
going forward, we will get us back on the right track. That is our
challenge.
It is not just Democrats, it is not just Republicans, it is not just
the Congress, we are in this with the President. We are all in this
together.
In closing, that is a good thing for us to remember. We are all in
this together. We do not have all of the smart ideas on this side,
neither do the Republicans. It has to be a combination of spending and
revenue. If we are smart about it, we will come out of this at the end
of the day just fine.
I yield the floor to my friend from Florida.
The PRESIDING OFFICER. The Senator from Florida.
Mr. NELSON of Florida. Madam President, I know that the Senator from
Massachusetts has time. I just want to take this time while he is
coming into the Chamber to say that you can almost hear in the
background very foreboding music as we are counting down the days. Here
we are in a situation in which we cannot get a certain group of people
over in the House of Representatives to be willing to sit down, and, as
the Good Book says, to come and let us reason together.
If we are going to govern this country, we have to come and reason
together, people of goodwill who will respect each other's point of
view, to hammer out a final agreement in order to start bringing this
country into balance. It is sad that it is taking this long and this
much of a difficult torturous process.

Florida's History

On a much happier note, at a subsequent time I want to share with the
Senate the wonderful heritage that we have in this country, not from
the English but from the Spanish. We are about to celebrate 500 years
of the discovery of what is now America, the United States, from the
Spanish explorer Ponce de Leon who first came to the shores of my
State. Then soon thereafter we will celebrate the 450th anniversary of
the oldest continuous settlement, a settlement that is 42 years before
the English came and settled Jamestown.
Those celebrations are going to be not just for Florida and not just
for St. Augustine but for all of Florida and all of the country. We
have a commission that has been appointed by the Secretary of the
Interior. We have just kicked off that commission. I will be sharing
with the Senate a lot about this historical restoration in the public's
mind of all of those Spanish explorers who helped establish this
country, first with Ponce de Leon in 1513, and he came back in 1539.
By the way, the Puerto Rican community is quite energized and excited
about this because Ponce de Leon, when he came and found at the Feast
of Flowers, Pascua Florida--and thus he named La Florida--he was the
Governor of Puerto Rico.
So they are quite excited, as they should be, and they will be part
of this celebration.
After him came a Spanish explorer named de Ayllon, who sailed up the
coast.
Later, in 1527, came Spanish explorer Narvaez, who landed somewhere
in the Tampa region and went up into the panhandle of Florida.
After him came the Spanish explorer Hernando de Soto in the late
1530s. He ended up landing also in the Tampa Bay region when, all over
Florida, they celebrated the first Christmas because he had Spanish
priests with him and was in what is today Tallahassee by Christmas Day.
They celebrated the first Christian Christmas by Europeans in this new
world of what is now the United States. That was the late 1530s. Then
he ended up traveling all over the United States, what is now the
Southeastern United States.
Then along came de Luna thinking he would have the first permanent
settlement in 1559 in Pensacola, and in 1561, along came a hurricane,
and it wiped them out. We had the King and Queen of Spain in Pensacola
on that anniversary back in 2009.
Then later came the French thinking they were going to set up the
first permanent settlement at Fort Carline at the mouth of what is
today the St. John's River at Jacksonville in 1564. But when they heard
that the Spanish explorer Menendez had come 30 miles to the south to
set up this permanent settlement at St. Augustine, they sailed to wipe
out the Spanish colony and instead got hit by a hurricane and were
shipwrecked and thus dispatched by the Spanish explorer Menendez. From
there, St. Augustine continued all the way to the present day. You
ought to see that restored city. It is a sight to behold, and it is not
only the history of St. Augustine, the history of Florida, it is the
history of this United States.
I will share a lot more about our Spanish history, our roots in this
country. I thank the Senator from Massachusetts for his kind indulgence
so that I might share this with the Senate.
I yield the floor.
The PRESIDING OFFICER. The Senator from Massachusetts is recognized.
Mr. KERRY. Madam President, I congratulate the Senator from Florida.
I am delighted to accommodate him and join with all Floridians in a
good celebration of a great part of our history.
Madam President, obviously everybody in America is well aware that
the date of August 2 is fast coming at us. They are also,
unfortunately, well aware that the Senate and the Congress appear to be
stuck yet again at this moment--in fact, here in the Senate we are
debating a constitutional amendment to balance the budget instead of
balancing the budget. I have heard a lot of sidesteps around here, but
this is what they call a message amendment. It is sending a pretty
mixed message to America.
What we, in effect, ought to be doing is not trying to pass a piece
of paper

[[Page S4774]]

that tells us to do what we know we ought to do, we ought to be doing
it. What we ought to be doing is stopping our country from defaulting
on debt that has already been obligated.
What people are refusing to do in the House on the other side of the
aisle is to live up to our obligations. This is not suggesting that we
are giving permission to borrow more money to spend money on something
responsible in the future; this is paying the debts of our country--
money already spent, already obligated.
Here we have the so-called Cut, Cap, and Balance Act that passed the
House of Representatives. Everybody understands it is nothing more than
an ideological message exercise. Everybody knows it is not going to
pass the Senate. We know even more that if it does pass, it is not
going to be signed by the President of the United States. What it is
doing is taking up time that we ought to be spending with a real
solution on the floor of the Senate that addresses the needs and
concerns of the American people. We ought to be reaching that
compromise. What this does, unfortunately, in terms of message is it
sends a message to the American people that this place may not quite
get it still and that a lot of folks here are more prepared to play
politics than to really engage in the real business of our Nation.
If you look at the specifics of this legislation, which is not going
to pass, it is divided into three parts. Each one of them is equally
problematic.
The cut part of the bill would require immediate cuts that would cut
almost 1 percent of our GDP, which economists tell us would result in
the immediate loss of 700,000 jobs. So they are coming to the floor
with a program to actually cut 700,000 jobs at a time when most
Americans believe job creation is the single most important thing we
can do in the country, as well as avoid defaulting on our debt.
The cap part locks into place the unrealistic spending levels the
House passed in their budget, while at the same time preserving
hundreds of billions of dollars in tax cuts for the wealthiest
Americans and tax loopholes for the biggest corporations.
I think every American scratches their head and says: What? They are
going to put in these unrealistic caps that would strip away research
and development, education funding, the ability of kids to go to
college--all of the things on which we build the future job base of our
country. They are going to strip that away, but preserve the tax cuts
for the wealthiest people in the country, who, incidentally, may be
investing the benefits of those tax cuts in China or in India or job
creation in many places other than here.
The balance part of this amendment requires the passage of a balanced
budget constitutional amendment that would require a supermajority to
raise any new revenue or close any wasteful tax loopholes. In other
words, you don't have to have a supermajority to decide where and what
you are going to wind up spending, but you have to have a supermajority
in order to raise any revenue or close an egregious tax loophole--one
that may have no economic purpose, may be completely outdated, or may
be a sweetheart deal that got into the Tax Code over the course of the
years, but you still have to get a supermajority to get rid of that.
Everybody here knows how hard it is to get 60 votes. A lot of the
business in the Senate has been caught up by the eternal filibuster.
Every single nomination, every single small piece of legislation that
comes to the floor of the Senate--everything requires a motion to
proceed, which requires 60 votes, which is effectively a filibuster
each time. We have had a record number of filibusters in the Senate
over the last three years compared to any other time in the entire
history of the United States of America, so requiring that two-thirds
supermajority would lock in gridlock, it would lock in bad policies for
the future.
The constitutional amendment that is proposed would make all revenue-
raising measures unconstitutional unless they secured a two-thirds
supermajority in both the House and the Senate.
Again, I repeat, we do not need a piece of paper, a new one--we do
not need an amendment to the Constitution, a group of words--to tell us
to do our duty. Every single Member of the Senate raised their right
hand and took an oath of office over there beside the Presiding Officer
and said they promised to uphold the Constitution of the United States.
All we need is the courage and the conviction to make compromises and
do the business of the Senate. It is not going to get any easier just
because you pass some words that tell you to do it.
We did this in the 1990s. What I am talking about is not pie-in-the-
sky, it is not some theory; we balanced the budget in the 1990s. We did
it without a constitutional amendment. We had people of good common
sense who came together and voted on compromises, and we not only
balanced the budget, we created a $5.6 trillion surplus for America,
and at the same time we created 23 million new jobs for Americans.
Guess what. While we balanced the budget in a sensible way, without
artificial caps and artificial, Draconian instructions but with common
sense, while we did that, every single quintile of American income
earners rose in their income. Every single American quintile saw their
incomes go up. America got richer than at any time in America's history
even as we balanced the budget without a balanced budget amendment.
So I will tell you, if we go down the road our friends on the other
side of the aisle are proposing, we will see major reductions in
Medicare, and much worse than what the Ryan budget proposed, and Social
Security beneficiaries would receive a $3,000 reduction in average
recipient benefits within 10 years and be forced to see deeper cuts
down the road. I think it is safe to say, without exaggeration, that it
would put an end to Social Security and Medicare as we know them today.
This week, Eric Maskin, Robert Solow, and Alan Blinder--each a Nobel
laureate in economics--and other renowned economists sent an open
letter to President Obama and Congress in strong opposition to a
constitutional balanced budget amendment. These economists stated that
a balanced budget requirement to the Constitution would be a ``very
unsound policy'' that would adversely affect the economy.
They believe that adding arbitrary caps on Federal expenditures would
make the balanced budget amendment even more problematic.
A balanced budget amendment would mandate perverse actions in the
face of recessions. By requiring large budget cuts when the economy is
weakest, the amendment would actually aggravate recessions.
Madam President, in the 27 years I have been privileged to serve
here, we have already debated this several times. We have voted on it.
As I have said in the past, the most compelling argument against this
amendment doesn't come from me or from anybody on the floor; it
actually comes from the real experts, the people who framed the
Constitution of the United States. If they were here on the floor of
the Senate today, they would vote against this amendment because it
violates the Constitution's most basic tenet majority rule. The notion
that the most fundamental document of law can be set aside for a time
is ludicrous and anathema to the very reasons for having a governing
document at all.
Worst of all, this bill from the House Republicans, holds hostage the
increase in the debt limit needed by August 2 and it holds it hostage
until a constitutional amendment to balance the budget is sent to the
states. We all know that is not going to happen. August 2 is looming.
We have to put aside this type of partisanship. We need to sit together
and develop a bipartisan plan that works for America with no
preconditions and not hide behind a constitutional amendment that makes
choices for us.
We can no longer afford to delay. We are facing a default that would
jeopardize Social Security payments, Medicare benefits, and troops'
pay, as well as send interest rates soaring in a way that would force
Americans to pay more for their mortgages, student loans, and small
business loans. And the whole world is watching to see if we make the
right choices because the consequences would be cataclysmic.
Madam President, let's get real. President Obama offered to cut the
debt by $4 trillion--exactly what we know we need in savings and nearly
twice as much as the Republicans had

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proposed--and Republicans turned it down. President Obama has gone the
extra mile. He has put everything on the table, even things Democrats
strongly oppose. But the House Republicans simply will not budge
because for them, this isn't about the deficit; it is about ideology,
an extreme ideology.
But it needs to be about priorities. And leadership. President
Kennedy said ``sometimes party asks too much.'' Well, if the cost of
ideology is economic ruin, the House Republicans really are asking too
much--much too much. Americans deserve better. They need the Senate not
to be a slightly slower version of the House; no, they need the Senate
to be the deliberative body of serious people the Framers expected us
to be.
Madam President, I yield to the majority leader.
The PRESIDING OFFICER (Ms. Klobuchar). The majority leader.
Mr. REID. Madam President, I appreciate my friend's courtesy.
I want everyone who has any interest in this piece of legislation on
the floor today to know that now is the time to come and debate to
their heart's content. If they want to debate it late tonight, we are
here to do it late tonight. If they want to debate it tomorrow for a
period of time, they can do that.
I think this piece of legislation is about as weak and senseless as
anything that has ever come to the Senate floor, and I am not going to
waste the Senate's time day after day on this piece of legislation,
which I think is anathema to what our country is all about. So I want
everyone to understand we are going to have a vote tomorrow. I am not
going to wait until Saturday. We are going to vote tomorrow, and I feel
confident this legislation will be disposed of one way or the other.
The American people should understand this is a bad piece of
legislation--perhaps the worst piece of legislation in the history of
this country.
The PRESIDING OFFICER. The Senator from Massachusetts.
Mr. KERRY. Madam President, I hope we will move quickly to the real
business, which is avoiding default. Let me say, I think there is one
effort we ought to be engaged in, and that is the serious effort of
passing the McConnell-Reid, Reid-McConnell initiative, or whatever you
want to call it. Their initiative is not kicking anything down the
road. Their initiative requires, just like the base closing commission,
for the Senate to deal with the big deal in a very short period of
time. If colleagues want to speed that period of time up, I wouldn't
object. I think that would make sense.
What we need to do is to recognize that in the next few days we do
not have the time to put the kind of common sense to the task that will
allow us to get the budget figures from the CBO, that will allow us to
know with certainty what we are doing with Medicare, Medicaid, Social
Security, or all of these other important initiatives are being done in
the most deliberative and thoughtful way possible. That is what this
institution is supposed to be about. That is what makes the Senate the
world's most deliberative body, but it hasn't been particularly
deliberative on this subject in the past months.
We have the opportunity, with the Reid-McConnell initiative to be
able to put in place a process that will guarantee we have up-or-down
votes on these critical issues after all the relevant committees have
had the opportunity to weigh in, using perhaps the budget commission's
report, together with what the so-called Gang of 6--which I don't think
is a particularly appropriate name--has proposed, which I think is a
very constructive and important contribution to the debate. It helps us
have a starting point for this discussion, as Congress, in the next
short period of time, actually fashions the kind of budget decision
that benefits America and does credit to this institution as a truly
deliberative body.
That is what I hope we do, and I look forward to working with my
colleagues in an effort to make that happen.
Madam President, I yield the floor.
Mr. ROCKEFELLER. Madam President, I ask unanimous consent to speak as
in morning business for, hopefully, no more than 15 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.

FAA Reauthorization Extension

Mr. ROCKEFELLER. Madam President, yesterday, at the direction of the
leadership, the House passed an FAA extension. Unlike the 20 previous
FAA extensions, their extension included changes to FAA policy that had
not been agreed to by both the House and the Senate--both Chambers.
What is the effect? The effect is that move will begin to shut down the
Federal Aviation Administration, beginning tomorrow at midnight, if we
do not reach agreement on a sensible path forward to pass a clean FAA
extension bill.
The consequences of an FAA shutdown will be severe. This is not about
me or the content of the extraneous provisions in the House bill. This
is about being responsible and doing the necessary work to ensure our
aviation system continues to function at its highest level while
Congress completes its business.
Over the past 4 years--which is how long we have been negotiating
this bill--we have been able to work together to do the right thing
each time the FAA authorities were about to expire. Congress has
consistently acted to pass extensions to make certain the Nation's air
transportation system continues to operate safely. Therefore, we have
passed 20 extensions over 4 years waiting to do the work we need to do
for an enormous Federal agency. In only one case were policy changes
made during the consideration of an FAA extension, and that was last
year. Airline safety measures were included because both the House and
the Senate negotiators agreed to them, and the extension passed
unanimously in both Chambers. You don't pass an extension which has
policy riders on it unless they have been agreed to by both Chambers.
It is very unfortunate the House is taking a rash approach to pass a
bill when we have made so much progress negotiating a complete FAA
reauthorization package. From the time the House passed the FAA
reauthorization, we have had more than 3 months of productive
negotiations, where staff engaged in more than 30 meetings and spent
hundreds of hours developing this legislation.
Over this period, we have worked the entire number of items to be
resolved from 281 separate issues to approximately 10 separate
provisions of consequence. House and Senate negotiators have compiled
more than 300 pages of text for a bill. All of the components of the
legislation represent needed aviation policy changes that will improve
the country's airspace system.
I remind you that our country, unlike virtually any other in the
modern world, basically uses radar as a way to approach landing or
takeoff. It is embarrassing. It is ridiculous.
I have been able to negotiate with the two other committees in the
House--the Science Committee and the Homeland Security Committee--to
develop workable agreements on all of our policy differences. The main
items that need to be made final are difficult, yes, partisan
provisions that fall within the jurisdiction of the House
Transportation and Infrastructure Committee--T&I, as they say--and its
chairman, John Mica.

The House bill was developed in a partisan manner. It had a number of
problematic provisions added during floor consideration. Central to
these was the decision to include language that would reverse a
National Mediation Board decision from the previous year. The National
Mediation Board--the NMB--provision was so tainted that it passed by
just seven votes in the House, which is overwhelmingly Republican. It
passed by just seven votes. Consideration of the final FAA package
passed in the House by a party-line vote of 223-196. Ultimately, the
House FAA reauthorization bill garnered the narrowest vote margin for a
House FAA reauthorization bill in almost 30 years. I am talking about
the House of Representatives.
As the House well knows, the White House has threatened on numerous
occasions to veto any FAA package that includes the House's National
Mediation Board language. The House's addition of policy riders to the
extension that are being considered as part of the FAA reauthorization
discussions represent an abandonment, in my judgment, of the good-faith
negotiations we have been engaged in for the last 3 months.
The House acted without consulting the Senate on this FAA extension,

[[Page S4776]]

without engaging the Senate on putting policy riders into their
extension. From their actions and public statements, it is clear this
effort is designed to force the hand of the Congress on the National
Mediation Board provision that President Obama has singled out as a
reason to veto the legislation. That is the legislation which basically
says if you have a vote for a union, or for whatever, and if you are
not present and don't vote, your vote is automatically counted as no.
This is a whole new concept of democracy in America, one which is very
strange and very wrong.
The House claims that negotiations on the FAA bill have been stalled
over the NMB issue, but they have simply not done their work. It has
been over 100 days since the House passed the FAA bill and they have
never even appointed conferees. We have done that; they have not. The
Senate is ready to break this deadlock, but we have not been able to
engage in a formal process because there are no House conferees. The
Senate includes all of its conferees in negotiations and works through
each provision to reach bipartisan agreement. And as I indicated
earlier, we have gone from 281 down to 10 issues. The House only had
Chairman Mica, and now the House leadership, calling the shots on each
negotiated item. It makes it very awkward to negotiate anything at all.
If the House wants to move forward, it is time they appointed
conferees and we will be able to determine where things stand on what
remains in the FAA reauthorization bill. But the Senate cannot accept
the House sending over items that remain to be negotiated in a
piecemeal fashion as part of this FAA extension, which is what they
have done; or for that matter, any future extensions. And it may come
to that.
The American people expect Congress to work together to reach
agreement. That is what I have been in the Senate for, to reach
agreement, and not to have 20 extensions over 4 years. What an
embarrassment, chopping the FAA continuity up into tiny little chunks
so they can't even let out contracts or proceed with their work. The
American people expect Congress to reach agreement, and I believe we
can do this, but it is going to take some more time.
If the House continues its attempt to hold the Senate hostage on the
FAA extension, it will result in a partial shutdown of the Federal
Aviation Administration, and people need to consider that very
seriously. A majority of the Senate is more than willing to pass a
clean FAA extension of any length. This week, I introduced S. 1387,
with Senator Kay Bailey Hutchison and Senator Max Baucus, to do just
that. Our bill would give the FAA the necessary funding and authority
to keep the agency functioning into September--I think September 16.
I have also indicated to the House on at least four occasions that I
am willing to drop all of the remaining controversial items that are
not included in both bills in order to get us close to a deal. That
offer--seemingly reasonable--has been consistently rejected by the
House.
Despite the House's lack of appointing conferees on the FAA bill, and
willingness to threaten the agency with problematic extensions, I do
remain committed to completing this process in a proper and responsible
way.
Again, after spending 4 years trying to complete this bill, nobody
wants a resolution more than I do. It is not a way to run a train, much
less an airline.
I believe we can finish a comprehensive FAA reauthorization by August
if the House will come back to the negotiating table in good faith. I
am willing to sit down at the table anytime to move the larger FAA
package forward or to develop an FAA extension that can pass the
Congress. We will try to move a clean FAA extension through the Senate.
Having said that, I ask that the other Members do support this effort
when that happens, which will be shortly, and allow us to complete the
FAA reauthorization bill.
I will say a word on the consequences of an FAA shutdown. An
expiration of the FAA will shut down any activities funded out of FAA's
four capital accounts, which I will not name. This includes a program
to halt the airport improvement program, which provides $3.5 billion
for infrastructure projects at airports annually and is estimated to
support more than 150,000 jobs a year now. Nonessential employees will
be furloughed, and approximately 4,000 FAA employees will be among
them.
If the FAA authorities do expire, the agency estimates it could only
operate air traffic support services through about mid-August 2011.
This would mean services to smaller areas such as mine, West Virginia,
would need to draw down in the near term so that the FAA can focus on
primary traffic. That is not something we would look forward to.
A shutdown quickly starts to have safety implications too and safety
projects at airports. It also places a hold on testing and
implementation of NexGen efforts, Next Generation efforts. That is the
modern GPS-based system which is clear, precise, and reads where
airplanes are and how fast they can land one after the other with great
precision. Fewer personnel will be available to dispatch to problem
areas. So these are real concerns.
Madam President, I hope my colleagues will hear what I have said. I
hope my colleagues in the other body will hear what I have said. I want
to proceed in good faith. I have tried. It has not worked. The American
people are suffering as a result of it, particularly the aviation
industry and the Federal Aviation Administration. I would hope my
speech will be listened to.
I thank the Presiding Officer and I yield the floor.
The PRESIDING OFFICER. The Senator from Georgia is recognized.
Mr. ISAKSON. While the distinguished chairman of the Commerce
Committee and my dear friend from West Virginia is on the floor, I
wanted to illuminate a little bit of the difficulty on the FAA
reauthorization.
I share concern with the chairman, as he knows, because we talked in
the well last night about our desire for a reauthorization of FAA and
how important it is to our economy. But the difficulty between the
House and the Senate, in part, has been over the House version as it
treated the National Mediation Board versus the Senate's unwillingness
to consider any change in current status with the NMB.
I have been the negotiator or the runner, or whatever you want to
call it, between the two bodies, Mr. Mica and Mr. Rockefeller. As the
chairman knows, about 1 month ago I delivered Leader Reid a
comprehensive list of requests the House had asked for in the
reauthorization. Senator Reid and his staff, after pondering it for a
few days, responded that they would not agree to any of the changes
that were requested.
I then went back and said, well, let me see what I can do to try to
find some common ground, and came back with a recommendation I gave to
Chairman Rockefeller that said give judicial review to the airlines,
which the unions already have under the National Labor Relations Act,
to have a balanced treatment in terms of a response in terms of NMB
regulation. As it turns out, that was an unsatisfactory offer.
The House I think still insists that some provision addressing the
National Mediation Board should be included in the authorization, and
that--and if I am incorrect in any way, please, Mr. Chairman, correct
me--I think that is the primary difficulty in getting to a final
conclusion.
From my standpoint, I want everybody to understand clearly, I agree
with the chairman that we need a reauthorization. But I also think we
need a balanced playing field with NMB, and I continue to work to try
and find some common ground to see to it that the aviation industry can
have judicial review, just as the unions already have, with regard to
NMB regulations and NMB rulings.
I wanted that to be documented in the Record. I thank the chairman
for letting me have a little time.
I yield the floor.
The PRESIDING OFFICER. The Republican leader is recognized.
Mr. McCONNELL. Madam President, it has been reported that the White
House has made an internal decision not to send Congress three long-
pending free trade agreements before the August recess. I wish to be
able to reiterate that I, for one, remain as committed as ever to
passing these job-creating agreements into law as quickly as possible,
given the condition of our economy.

[[Page S4777]]

As I see it, every sticking point seems to have been resolved. The
White House initially said it needed a deal on trade adjustment
assistance on the substance. I think they have gotten that. Then they
said they needed an agreement on the process. I believe we have
achieved that.
I, myself, am personally committed to working with the majority
leader to ensure a fair floor process for my Members so they have an
opportunity to try to amend a stand-alone trade adjustment assistance
bill separate from the three free-trade agreements. That way, if the
administration can generate the votes it needs, TAA will pass on its
merits.
I think we have a pretty clear path in front of us at this point. I
recognize that the calendar is tight, that we have got a lot of other
urgent business to take care of around here, so I don't expect to
finish any of this before August. Still, I think the administration
should submit the agreements anyway as a show of good faith with our
trading allies in Korea, Colombia, and Panama. Then we can work to pass
them when we return. The administration has received everything it has
publicly asked for on TAA. It is time to show they are serious about
creating jobs and getting those deals done.
This is an opportunity to create jobs in America for Americans. It
was snarled needlessly by the suggestion that TAA be dropped inside
these agreements. That now has been cleared up. We are going to have an
opportunity to ratify all three of these trade agreements, which will
be good for the country, and the TAA issue will be dealt with
separately, and all indications are that the votes are there to pass
the TAA bill.
With that, Madam President, I yield the floor.
The PRESIDING OFFICER. The Senator from Iowa is recognized.
Mr. GRASSLEY. Madam President, I come to the Senate floor to tell my
colleagues why I support the issue of cap, cut, and balance.
On August 2, our Nation will be unable to borrow money to meet our
current obligations. We have known for a while this was coming. Our
annual deficits have been near $1.5 trillion for the past 2 years and
are going to be that large this year as well.
With deficits of that size, no one should be surprised that we have
hit the debt ceiling, which raises the question then: What has the
President offered to confront this looming crisis?
I ask that question because people expect a President to lead, and we
have had an executive budget and an executive budget law since I think
the 1920s putting the President in the lead on these issues.
So I ask another question: What has the Senate Democratic majority
done to address our deficit crisis? Because it is the responsibility of
the majority to present a budget to the Congress of the United States,
and we have not had a budget resolution for more than 800 days now. So
I think you can draw the conclusion, whether it is the President of the
United States or the Senate majority, the answer is simple: Not much
has been done.
Last year, President Obama virtually ignored his own deficit
reduction commission. Remember, in February 2010 the President
appointed a lot of people to a deficit reduction commission to give us
a plan of what could be done about this fiscal situation that has
happened so dramatically in the last 2 years, and there was no
recognition in December when they reported that the President said that
is the thing that should be done in this country.
This year, he did offer a budget, as he has to do under the budget
law, February 14 of this year. That budget would increase spending,
increase taxes, and still add trillions to our debt.
Everybody would think that a Democratic President suggesting a budget
would be well-received in a body that is controlled by the same
political party. But that budget he presented in February was so ill-
conceived and out of touch that it was defeated here in the Senate by a
vote of 97-0.
Let me emphasize that by saying not a single Senator of either party
voted for President Obama's budget. Of course, it is very obvious that
every member of the President's party said no to the President's
budget.
For most of this year, President Obama said we should raise the debt
ceiling without taking any measures to address our long-term deficits
and debt. It was the position of this administration that Congress
should simply rubberstamp another debt ceiling hike with no plan in
place to reduce our deficits.
That plan was voted on in the House and was soundly rejected there as
well. All of the Republicans and nearly half of the Democrats in the
other body voted against increasing the debt ceiling without deficit
reduction.
So it seems to me we have a lot of bipartisan agreement, when people
say we have no bipartisan cooperation, that with the Senate's vote on
the President's budget and in the other body with nearly half of the
Democrats opposing a debt ceiling without deficit reduction, that there
is a clear understanding in a bipartisan way in the Senate that the
President's budget spends too much, taxes too much, and leaves too much
debt. In the House of Representatives, there is a strong feeling that
is bipartisan that if you are going to have a debt ceiling increase,
there needs to be deficit reduction. So don't ever say there is not
bipartisan agreement, because it has been expressed in votes in both
Houses.
The President then gave a budget speech in April, and I presume he
recognized the inadequacy of his budget presented to Congress in
February. He outlined a budget framework that would reduce that budget
that was presented in February by $4 trillion over 12 years. So the
President very quickly in about 60 days came to the conclusion that his
budget was out of step with what people of even his own political party
felt was necessary so he could find $4 trillion to trim out of it.
But do you know what he hasn't done yet that a President ought to do
in an environment where we have an executive budget process? He still
hasn't presented the details of that budget.
The Director of the Congressional Budget Office, Dr. Elmendorf--as we
all know, a person who is a devoted public servant, doing what is
intellectually right all the time when he tries to help us decide how
much money taxes are going to bring in or how much is going to be spent
on a particular policy of Congress--was asked if he could estimate the
budget impact of this new framework that came with the President's
speech on April 13, in which he came to the conclusion you ought to
spend $4 trillion less than what he thought he could spend on
Valentine's Day. That is not necessarily a Valentine's gift in his
February budget.
This is what the CBO Director said in regard to that April 13 speech.
He said:

We don't estimate speeches. We need much more specificity
than was provided in that speech for us to do our analysis.

But, so far, the President has not provided those specifics. We have
heard a lot from the White House about the need to come up with a plan,
when the President has not presented a plan. The White House itself has
never offered a single debt ceiling proposal for voters, and the Senate
Democratic leadership has also seriously shirked its responsibilities
because, as I said once before today, they have not put forward a
budget in more than 800 days, even though the law requires that they do
it.
Every family in America who works hard and sacrifices to pay their
bills ought to be ashamed of the failure of the Senate to offer a
budget, in violation of the law. In sharp contrast, Members of the
House fulfilled their responsibility and passed a budget earlier this
year. So the very same majority party in this body that has not
presented a budget for 800 days has done nothing in regard to the House
budget but demagog.
While they can't find time to compile their own budget, they sure
found time to make speeches that are derogatory about the House budget.
The House budget, then, obviously means the House of Representatives
did their responsibility under the law by presenting a budget and
adopting a budget.
While Members on the other side come to the floor to oppose and
demagog the bill I am speaking about--the cut, cap, and balance bill--
they have offered no plan of their own. While there is now a framework
from the so-called Gang of 6, their plan also lacks any specificity.
Perhaps that is the political strategy the other side has chosen.
Voters and the American people

[[Page S4778]]

cannot be upset with the position you have taken if you have not taken
a position. It is like a rule for political leaders: You never get in
trouble for a speech you do not give. Perhaps this strategy may be
politically expedient, but it is going to drive our economy and our
country off the cliff.
The strategy of placing a higher priority on the next election rather
than the economic and fiscal situation facing our country is how we got
into this mess. Based on the lack of proposals put forth by the other
side, one could assume they are perfectly content borrowing 40 cents
for every dollar we spend. Are they pleased with the deficits of $1.5
trillion annually? We could conclude they must be because they have not
offered a plan to reduce the deficits.
On top of that, they have argued for tax increases. They must believe
we have a revenue problem. According to their argument, the American
people are not handing over enough of their money to satisfy the needs
of Washington to spend. I am not sure we can ever tax high enough to
satisfy the attitude in Congress to spend. In fact, if somebody would
tell me how much money they really need from the American people to
satisfy their appetite to spend, and I could get a limit on it and it
were a hard limit, I might even vote for it because I would like to
have people say they are finally satisfied, that government ought to be
so big but no bigger. But I never get those sort of broad statements in
the Congress. So I have come to the conclusion that we cannot raise
taxes high enough to satisfy the appetite to spend.
But because we are borrowing money, the economy is not growing, and
jobs are not being created because Washington is spending too much. Of
course, the other side believes the economy is not growing because we
are not spending enough from Congress.
Remember, just a few years ago they passed the $800 billion so-called
stimulus as a means to keep unemployment below 8 percent. That was
early February 2009. That is when Speaker Pelosi said: Yes, we wrote
the bill. We won the election.
So employment shot above 8 percent right away. It got up over 10
percent. It is at 9.3 percent. So the promise of a $830 billion
stimulus keeping unemployment under 8 percent just did not work. What
did they do under those circumstances? They borrowed money and spent it
on government programs.
Where is the U.S. economy today? I will say it again: 9.2 percent
unemployment, more than 14 million Americans out of work, and now the
national debt is more than $14.3 trillion. This experiment called the
stimulus proved that government spending does not stimulate private
sector job growth. Do you know why? Government consumes wealth;
government does not create wealth. The only jobs created by government
are government jobs. They don't add value to the economy; they are a
cost to the economy.
Do we have to have government? Yes. Do we have to have government
employees? Of course we have to have government employees. But to think
we can hire more government employees and create wealth is false. The
fact is, we are the hole we are in because of our spending problems,
not because we do not have enough revenue coming in.
Look at this historically. Spending has averaged about 20 percent of
our gross national product. That is probably over four or five decades.
Today and in recent years spending has grown to 25 percent of the gross
national product. This level of spending cannot be sustained,
particularly when revenue has historically been around 18 percent of
GDP. This very day it is less than 18 percent because the economy is
not growing, but a 50-year average is 18 percent of GDP.
For my colleagues who think we can reduce deficits by increasing
taxes, they need to understand it just does not work. Professor Vedder
of Ohio University has studied tax increases and spending for more than
two decades. In the late 1980s he coauthored, with Lowell Galloway also
of Ohio University, a research paper for a committee of Congress called
the Joint Economic Committee that found that every new dollar of new
taxes led to more than $1 of new spending by the Congress.
In other words, raise taxes $1 and you think we would go to the
bottom line and reduce the deficit? But, no, $1 coming in, we spend
more than $1, so we make the deficit worse. Professor Vedder has now
updated his study. Specifically he found:

Over the entire post World War II era through 2009, each
dollar of new tax revenue was associated with $1.17 of new
spending.

History proves tax increases result in spending increases. We know
increasing taxes is not, then, going to reduce the deficit. Instead of
going to the bottom line, tax increases are a license for Washington to
spend even more.
History also shows that tax increases do not increase revenue.
Everybody thinks if we raise the marginal tax rates we will bring in
more revenue. But the taxpayers, workers, and investors of this country
are smarter than Members of Congress are who believe that.
Regardless of the rate, over the past 40 years--I am sorry, I don't
have a chart with me. I had a chart with me a week ago that
demonstrated this. But if you listen closely, you will get the message
of the chart.
Regardless of the rate of taxation, over the past 40 years revenue
has averaged, as I said before, about 18 percent of gross domestic
product. Higher tax rates just provide incentives for taxpayers to
invest and earn money in ways that reduce their tax liability. We
cannot tax our way out of this problem. We have a spending problem, not
a revenue problem. That is why I am supporting the only plan that has
been put forth to address our deficit and debt problem: the cut, cap,
and balance plan passed by the House with the bipartisan support of 234
Members.
This plan is the only plan offered to cut spending in the near term.
We need to halt and reverse the trend of the last 2 years when
government spending increased by 22 percent, not even counting the
failed stimulus program of another $830 billion. We cannot increase
expenditures 22 percent when the growth of the economy is about 2
percent. It just does not add up. That is how we get into trouble, and
that is how we have increased a 50-year average of the national debt
from about 35 percent of gross national product to--after 2 years, it
is now 65 percent, and it is on a path to go over 90 percent.
We know where Greece is right now when they are over 100 percent. It
is going to lead to failure. We are on that path right now, and we have
to preempt that.
This bill before us also will impose budget caps to get our spending
down to a manageable level compared to our gross domestic product.
Finally, it would impose a balanced budget amendment to our
Constitution, similar to what--I don't know whether it is 46 States or
49 States--but most States have a constitutional amendment requiring a
balanced budget. You know what. It works.
We have to stop to think, if a State that is as liberal as New York,
if they can elect a liberal Democratic Governor, and if he can cut,
cut, cut, to live within that constitutional requirement of a balanced
budget, it ought to be something we can do in Washington DC. It is a
discipline that works in the States. It is a discipline that we need
through our Constitution so when we take an oath to uphold the
Constitution, the requirement of a balanced budget is something we
swear to, and we will deliver on our promise to the American people. It
only makes sense to impose a requirement that we live within our means.
Washington proves again and again that it needs this kind of
discipline.
I say to my colleagues: If you do not support this plan, then offer
your own plan. You know the debt limit must be increased, but you also
know we must take action to reduce the future levels of deficits and
begin to bring our debt down. Where is your plan to do that? Where is
your budget resolution that has not been presented in the last 800 or
more days to the Senate, violating the budget law? How will you meet
the responsibilities, then, of being elected to this office where you
take an oath to uphold the laws and the Constitution of the United
States?
The trajectory of our debt is alarming. It will soon undermine our
economy and our economic growth. If we do nothing, our children and
grandchildren will have fewer economic opportunities than we have had.
So this is not just an economic issue, this is not just a fiscal issue,
this is a moral issue of whether this generation, my

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generation and people who are even younger than me but spending a lot
of money, ought to live high on the hog and leave it to young people to
pick up the bill.
Without a plan to put our fiscal situation on a better path, the next
generations will have a lower quality of life than the one we have
experienced. We cannot let that happen. We must take action to correct
our course.
I urge my colleagues to support the cut, cap, and balance plan.
I yield the floor.
The PRESIDING OFFICER. The Senator from Hawaii is recognized.
Mr. INOUYE. Madam President, I ask unanimous consent that the time
from 5 p.m. to 8 p.m. on the motion to proceed to H.R. 2560 be equally
divided between the majority leader and the Republican leader.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. INOUYE. Madam President, I rise today in opposition to the Cut,
Cap, and Balance Act of 2011. Rather than taking a balanced approach
that requires shared sacrifice, House Republicans have passed
legislation that would gut essential services for average Americans
while asking nothing of the wealthy and privileged. Such a misguided
approach would cost countless American jobs while doing nothing to
solve America's long-term deficit challenges.
In my opinion, the Cut, Cap, and Balance Act fails to measure up as a
serious proposal to address the structural deficit that our Nation
faces. It is misguided, and assumes that our Nation will pay no price
if we fail to invest in our future. These are some of the assumptions
of this bill. Highways will not buckle, pipes will not rust, bridges
will not collapse, and there is no need to invest in the next
generation of innovators to keep America's competitive advantage. This
bill would gut the very funding we need to revitalize our economy and
invest in the future.
Cut, cap and balance would render Congress essentially powerless to
address revenues, thereby pushing America further down the road of
economic inequality by ensuring that the wealthy do not have to share
in any sacrifice. And whatever might be said about this legislation, to
call it balanced is a cruel irony. In fact, all of the sacrifice is
demanded of the poor and working families. This legislation forces
Congress to slash programs that average Americans rely on for
education, housing assistance, food safety, safer air traffic control,
and clean air and water.
We have an aging population, which means that increasing costs for
Social Security and Medicare are a reality that must be dealt with. The
Baby Boomers are retiring, which increases the need for Social Security
and Medicare. And while those programs are not subject to sequester,
how will we meet the higher costs and at the same time bring down
overall spending to 18 percent of GDP, a level that has not been
achieved since the 1960s? My colleagues should not kid themselves:
mandating a balanced budget by 2020 while taking revenues off the table
will require draconian cuts to Social Security and Medicare.
As the chairman of the Appropriations Committee, I take particular
note of the impact cut, cap, and balance would have on nondefense
discretionary spending. A 10-year freeze on domestic spending that does
not adjust for inflation would have a devastating impact on the ability
of all nondefense departments and agencies to carry out their missions.
My colleagues should know that over 10 years, such a cap would amount
to a 33-percent cut in real dollars. Such a level of cuts would make it
impossible for the United States to compete on a global stage. Our
infrastructure, our education system, our technology, everything we
need to remain a great nation will be drastically underfunded, or
simply not funded at all.
I hope we all understand that we are not talking about nice to have
things, we are talking about investments that are necessary to maintain
the quality of life for the middle class. Education is not optional.
Roads and sewers, clean air and clean water are not options. Meeting
the basic nutritional needs of our poorest children should not be
optional. This great Nation was built on such investments, made in the
best interests of the American people--all the people, not just the
wealthiest one-tenth of 1 percent.
I would like to take a brief moment to provide a few specifics about
the impact of this act. While it is not possible to predict specific
impacts 10 years down the road, it is certainly possible to give
examples of what the American people would experience in the near term,
as a result of this deeply flawed bill.
In fiscal year 2012, Head Start funding would decrease by more than
$900 million, eliminating comprehensive early childhood services for
over 130,000 low-income children and their families and resulting in
the termination of 30,000 teachers, teacher assistants and related
staff.
The combined cuts to mandatory programs such as Food Stamps and
School Lunch programs coupled with domestic spending reductions
contained in this legislation would be a double blow to the Nation's
most vulnerable populations. With these cuts, there would be 13 million
fewer meals served to seniors. Let me be blunt, if this bill is
enacted, children and seniors in this Nation will go hungry in far
larger numbers than today.
We all recognize that reducing waste, fraud, and abuse are essential
components of getting our fiscal house in order. Every billion dollars
we save is a billion dollars we can use to reduce the deficit or better
invest in America's future. And yet this bill would reduce funding for
the Internal Revenue Service by some $1.8 billion below the President's
request for fiscal year 2012, which would cripple its efforts to find
fraud and eliminate waste and abuse. The IRS could be forced to
furlough between 4,100 and 5,000 employees, mostly enforcement agents.
Furthermore, a cut to IRS funding would increase the deficit by
approximately $4 billion a year beginning in 2013, since every dollar
invested in enforcement resources brings in $5 in tax revenues.
Finally, I would note that a cap on the Federal budget means that we
are unable to make smart choices about our future investments. As an
example, the Bureau of Prisons inmate population is expected to grow to
roughly 250,000 Federal inmates by 2018, an increase of more than
31,000 prisoners, or 15 percent, over the next 8 years. A growing
inmate population coupled with a spending cap for Department of Justice
activities will mean further severe cuts to other important functions
of the Department of Justice--Federal, State, and local public safety
efforts will be cut in order to pay the required costs of housing
prisoners.
Yesterday 97 Senators voted in favor of the Military Construction and
Veterans Affairs appropriations bill. The Senate is perfectly capable
of producing and passing fiscally responsible appropriations bills that
meet the Nation's needs and that have strong, bipartisan support. The
real answer to our fiscal crisis has not changed since this debate
began. We must cut spending in a responsible fashion. We must reform
entitlement programs to ensure that they survive for future
generations. And we must reform our Tax Code to allow for sufficient
revenues to meet the needs of an aging population and the challenges of
a global economy.
Cut, cap, and balance does none of these things, and I urge my
colleagues to reject this misguided measure.
The PRESIDING OFFICER. The majority leader.
Mr. REID. While the distinguished chairman of the Appropriations
Committee was talking, I had a visit with some of the pages to ask them
did they realize who was speaking. They all knew who he was. They knew
he was a heroic man winning the Medal of Honor. They knew he had been
elected to the Senate nine different times in addition to service in
the House of Representatives. So it is great that our pages are so
versed on what happens around here. We depend on them very much, and I
am grateful they understand what a great man the chairman of the
Appropriations Committee is.

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