Increasing The Statutory Limit On The Public Debt

Floor Speech

INCREASING THE STATUTORY LIMIT ON THE PUBLIC DEBT -- (Senate - January 25, 2010)

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AMENDMENT NO. 3302

Ms. COLLINS. Mr. President, I rise today in support of the amendment offered by Senators CONRAD and GREGG to create a bipartisan budget commission to address our Nation's long-term fiscal crisis.

The Conrad-Gregg amendment would create an 18-member bipartisan commission which would be charged with developing a specific plan to correct our government's long-term fiscal imbalance. All options would be on the table. The commission's legislative recommendations would require expedited consideration by the Congress, a supermajority vote in both Chambers, and Presidential approval.

While I would prefer that Members of Congress have the ability to offer revenue-neutral amendments to the commission's legislative recommendations, it is imperative that we move forward on this proposal. For this reason, I am pleased to be a cosponsor of the legislation.

I would note that I have not always thought the creation of an independent commission was the right approach. I was hopeful that Congress could tackle the issue of the looming fiscal catastrophe confronting us. But I have concluded that the only way we are going to achieve urgent action on the very serious fiscal problems we face is through the creation of this independent commission.

The fact is, America's out-of-control debt is a grave threat to our future prosperity. Just last month, the Senate voted to increase the debt limit to an astonishing $12.4 trillion, and yet here we are again today considering another increase in the debt limit--this time by $1.9 trillion, to $14.3 trillion. Last year, this body approved the President's budget which will double our debt in 5 years and triple it in 10 years. In other words, we are facing an explosion in the Federal debt.

As bad as that sounds, our Nation's debt problem is actually far worse. America has nearly $60 trillion in unfunded liabilities for programs such as Social Security and Medicare. These unfunded liabilities amount to $184,000 per person living in our country, or $483,000 per household. By contrast, median household income is just over $50,000.

As David Walker, the former Comptroller General and now president of the Peterson Foundation, put it in recent testimony before our Senate Homeland Security and Governmental Affairs Committee:

It doesn't take an economist or a mathematician to realize that this is unsustainable.

We are talking about debt levels that are unsustainable and threaten the very future economy of our country. Our problem, in a nutshell, is that government has promised more than our citizens can afford to pay.

One columnist described this as the collision between the high and rising demand for government services and the capacity of the economy to produce the tax revenues to meet those demands. Historically, Americans have paid about 18 percent of gross domestic product in Federal taxes. But with the explosion in entitlement spending tied to the retirement of the baby boom generation, plus interest on the national debt, Americans would need to pay taxes equal to 34 percent of GDP to keep pace with spending 25 years from now. That is right, the tax burden would have to soar to 34 percent of our gross domestic product.

I am looking at the young pages who are on the floor right now. It is their future we are talking about. They are the ones who are going to be faced with this enormous debt.

Even if it were possible to raise taxes in order to finance this rate of spending, that remedy would do tremendous damage to our economy. It would crush job creation, devastate our already battered small businesses and dash the aspirations and can-do spirit of our people. Thus, our decisionmaking must begin by reconsidering spending that, although popular, simply cannot be justified during this fiscal crisis. It is wishful thinking to hope we can simply grow our way out of this problem. Economic growth helps, there is no doubt about that, but it is itself endangered by this enormous debt.

Becoming more efficient and productive helps reduce our long-term financial challenges, but economic growth alone will not rescue us from the predicament we face. If we fail to stop this approaching tsunami of red ink, then the futures of our children and our grandchildren will be swamped by our negligence. The American dream as we know it, where each succeeding generation can achieve a higher standard of living and quality of life than the previous generation, will be over. It will not be easy, even with this commission, but we must confront the conflict between what we want and what we can afford. It is time to reassess our priorities, to make the hard decisions and to set a new fiscally responsible course for our country.

The budget reform commission proposed by Senator Gregg and Senator Conrad would begin to move us forward as a nation in facing these serious financial challenges. I know it is not easy for many of my colleagues to give away some authority to this commission. I remind them that the commission's recommendations would still come back to us and could not become law without our voting for them and without the President deciding to sign the recommendations into law. But I have concluded that the only way to jump-start the process, to do what needs to be done, to right the fiscal boat, to help us face these challenges, to help us move forward as a nation, is to enact the Conrad-Gregg amendment. I urge all my colleagues to support their effort.

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