The Debt Ceiling
Floor Speech
Mr. President, too many Ohioans are struggling--as are people all over the Nation--in this economy. They are watching Washington with disgust as some politicians are risking economic catastrophe. The House of Representatives continues to waste time as our Nation stands just 4 days away from a catastrophic default. Instead of working with us on a bipartisan basis in the Senate on a compromise measure to prevent a crisis, House Republicans are cutting closed-door deals to find votes on a bill that has no chance of becoming law. We are simply running out of time for these kinds of games.
Only a bipartisan bill coming out of the Senate, negotiated with Republican Leader McConnell and Democratic Leader Reid, provides hope for a way out of this impasse. As the majority leader moves forward, I ask my Republican colleagues across the aisle to proceed with its work and not delay the resolution with filibusters and procedural tricks.
In the spirit of compromise, Majority Leader Reid has come forth with a plan to reduce the deficit by $2.2 trillion. It is truly a compromise because it meets the Republicans' main criteria. It incorporates some of Senator McConnell's language. It contains spending cuts to roughly match the debt ceiling increase through 2012--the spending cuts in the Reid plan are ones Republicans had previously agreed to and, in many cases, advanced--and it contains no revenue increases, all criteria and demands from overwhelming numbers of Senate Republicans.
The majority leader's plan is not perfect. It is not the balanced approach I hoped it would be. But most importantly, right now, it prevents a default, it reduces the deficit--a critical imperative for our children and grandchildren--and it protects Medicare and Social Security and Medicaid.
My office is being swamped with calls and e-mails from Ohioans who cannot believe we are so close to default. I can't either. Let me read a couple letters from Ohio voters. Both of these individuals self-identify as Republicans when they write to me. The first one is from Representative Marcy Kaptur's district, which is in northern Ohio, along the lake. He says:
I am a 40-plus-year-old Republican who has tried to work to eliminate the tax money we use that is now paid to oil and gas companies as tax subsidies. I don't like my tax money being given to these companies with Senators' blessings. I would like to ask both of you--
He sends this, apparently, to myself and my colleague, Senator Portman--
to support a balanced approach being proposed by the President and put debt and deficit to bed until an election can be held and the American people can determine who should be in Congress. We should have listened to Ronald Reagan when he said this should not have been undertaken.
Meaning the debt limit issue.
The debt limit is on past bills and should not be raised and not be used as a political volleyball and upset our financial institutions.
Another letter writer--again, a Republican--says:
I did not vote for our current President, but I have to side with him on the debt ceiling issues. I am exhausted by the political bickering that goes on in Washington. Quit the child-like fighting and get this thing done. The American people are tired of it all.
A default would risk what amounts to a permanent tax hike on all Americans. Interest rates could rise for anyone applying for a home mortgage, a car loan or a college loan. Credit costs for all borrowers would climb. Governments at every level, businesses, not for profits, homeowners, credit card holders, even several States have already been placed on a credit watch. Every State would be hurt by a Federal default, which is why Governors of both parties are calling for a deal.
There could be repercussions for pension funds and money market funds that guard the retirement savings of middle-class families. A default on our obligations would be a knockout blow to the financial security of the Ohio Public Employees Retirement System. These are public employees who have spent their lives working in Ohio's courts and schools and many other public positions in local and State government. That is why the Director of OPERS--the Ohio Public Employees Retirement System--sent a letter with nine of her colleagues pleading:
America is now a debtor nation and must show the world the nation's word is its bond. It is critical that the debt ceiling be raised to avoid a default.
The Ohio Public Employees Retirement System, obviously, represents Republicans and Democrats alike.
As a member of the Senate Banking Committee, I heard Chairman Ben Bernanke, a Republican appointee, speak in March, and he said default would be ``an extremely dangerous and very likely recovering-ending event.''
Just today, several mayors of Ohio's large- and medium- sized cities--for example, the cities of Hillsboro, South Euclid, Chillicothe, North Royalton, Lancaster, Akron, Middletown, Shaker Heights, Reynoldsburg, Dayton, Steubenville, Solon, Newark, Fairfield, and other cities, Republicans and Democrats alike--wrote:
As Mayors, we rely on the partnership of the federal government to help us create jobs and grow our communities. Uncertainty surrounding the federal budget puts key programs like Community Development Block Grants and Community Oriented Policing Services in jeopardy. Job-creating infrastructure projects would come to a halt without the full support of our federal partners. Inaction on the debt ceiling threatens programs like Social Security that our citizens rely on to survive.
I have heard the Presiding Officer--in a meeting today, in fact--talk passionately about the uncertainty this would inject into our economy--to follow the House lead--and do this again in 6 months and the irresponsibility of that proposal. As difficult as this has been for people on all sides and the contentiousness and anger, it doesn't matter whether we are angry or it is contentious around here, but what does matter is the message it sends to main street--Main Street Connecticut, Main Street Hartford, Main Street Columbus, Main Street New Haven and Toledo. When businesses are thinking about expansion, when they are thinking about taking a loan out or thinking about borrowing money, they are not going to do it when we are in the midst of a financial crisis such as we are in now. If we were going to do this again in 6 months, you can bet we would have the same kind of divisions, the same kind of arguments.
The assistant majority leader told the story today about a Chicago bus i ness per son who is terrified of this and what would happen if we didn't raise the debt ceiling, if we went into default; what might happen 6 months from now if we went through it again.
So the responsible position is for this body, on a bipartisan basis, to work on the McConnell-Reid plan, to pass this, send it to the House of Representatives, and for them to pass it. We can then focus on job creation and on deficit reduction, but we will have moved forward together in a way that we have not for far too long a period of time.
Mr. DURBIN. Will the Senator yield for a question?
Mr. BROWN of Ohio. Of course.
Mr. DURBIN. There have been Members of the Senate and House who have gone before the cameras and come to the floor in each of those bodies and argued that defaulting on the national debt is really not a big deal, although we have never done that one time in our history--we had one technical default for a few days but never really defaulted on our debt one time in our history.
I ask the Senator from Ohio, in the response he is getting back from Ohio and I am getting back from Illinois from people who are genuinely concerned about a default on the national debt, I wonder if he has been hearing from Social Security recipients who are asking whether they will be receiving their checks after August 2 if we default on their debt. I wonder if he is getting calls from disabled veterans whom we promised to stand by the rest of their lives who receive monthly checks for their medical care and other things. Has he heard from small business leaders in Ohio, as I have in Illinois, who are suggesting that an increase in interest rates at this moment in time is exactly wrong when it comes to job creation?
I would like to ask the Senator from Ohio, when one of our colleagues from Pennsylvania comes to the floor and says defaulting on the national debt can be easily managed and no one will notice--I would like to ask the Senator from Ohio whether that is his impression.
Mr. BROWN of Ohio. That is surely not my impression. I appreciate the comments from the assistant majority leader from Illinois.
I listen to the words, as I have read, that Ronald Reagan said. The debt limit was raised 18 times in the 8 years of the Reagan administration, and each time it was, there were people who didn't like doing it. Nobody likes to vote for that. But there was never this: let's go up to the edge and take a chance. President Reagan always preached--as Presidents have since in both parties--that this is not a risk we can take, and I know this.
I hear from Social Security beneficiaries, I hear from veterans, I hear from small businesspeople, and I hear from contractors around Wright-Patterson Air Force Base that they don't think we should take this risk, that they are--some use the word ``terrified'' getting this close to default, and most can't really believe we are this close. I can't, either.
The Senator from Illinois and I have talked about this many times over the last few months, that we figured there would not be these lines in the sand and this belief that it doesn't matter if we default and we would get to a solution. But we haven't been able to.
But no responsible people in elected office that I can think of in the last 30 or 40 years have wanted to go this close to default and play chicken and just think, well, maybe it won't hurt us much. We know what happens with interest rates. We know what might happen with Social Security checks and veterans' benefits and prison guard pay and airport safety and food inspectors--all of those functions that matter. I don't know why any responsible leader in this body or the other body would want to take that risk.
Mr. DURBIN. I would like to ask through the Chair if the Senator from Ohio would yield for this question.
He may recall the time not that long ago when we closed down the government of the United States for a period of time, and there were some radio talk show hosts who argued that America wouldn't notice, just as they are arguing now that America won't notice if we default on our national debt. I know the Senator from Ohio can recall that and the fact that America did notice, and those who engineered that crisis paid a heavy political price.
What I am really getting to at this point, though, is to ask the Senator from Ohio--Monday night, when the Speaker of the House, John Boehner, went on national television with the President of the United States and announced he had a bipartisan plan, he called it, that he could pass in the House of Representatives, many of us had the impression that was going to be done on Tuesday. Well, it wasn't done on Tuesday or Wednesday or Thursday. It is only today that they are voting on it, some 5 or 6 days later.
I would like to ask the Senator from Ohio, losing that 4- or 5-day period of time when we could have been moving forward to a compromise--the impact that has as we face this looming deadline of a default on our national debt on August 2.
Mr. BROWN of Ohio. I thank the Senator for that comment and question. This is clearly more dangerous for our economy and our country, from Wall Street to Main Street, than what happened when they closed the government down 15 years ago or threatened to a few months ago. That was troubling, and that was damaging to our country, but we don't know what exactly would happen here. We are almost sure interest rates would go up. We are almost sure many people who benefit from government services directly would see those benefits go away. Whether it is a Social Security check or whether it is food safety or running the airports safely, all of those things would be at risk.
I have heard a lot of sort of brouhaha or a lot of strong words out of the House and a lot of promises, but there seems to be too many people in that Chamber who don't really see the seriousness of this, don't see that this really does put our economy in jeopardy.
You know, it is not just our economy. That is the most important part, but it is also our reputation around the world. It is the strength of the dollar. It is the blot on our national reputation. I haven't been to Europe in a long time, but I hear reports from people around the world that they are saying: What is going on in the United States of America that you can't even agree on raising the debt ceiling so you can really focus on things such as jobs?
I had a meeting just last week--Senator Rockefeller and I, earlier this week--and there were eight or nine Senators who joined us to talk about focusing on a jobs agenda and what we need to do to restore American manufacturing. In a State such as Illinois, and in Connecticut--the other Senator from Connecticut was in our meeting and talked about Bridgeport and New Haven and all the manufacturing that is done in this country. We are still a major manufacturing country. This is going to hurt manufacturers. It is going to mean they can't borrow to meet payroll or borrow to expand or borrow to create more jobs.
Why would we risk any of this instead of getting this done by focusing on job growth, and focusing on getting our budget in order? We know how do this. In the 1990s--and the Presiding Officer and the assistant majority leader were very much part of it--in the 1990s, we got to, one, a balanced budget and, second, we got to 21 million private sector jobs net increase because we passed a responsible budget. It had some tax increases for upper income people. It also had some tax breaks in it for middle-income people. It also had major cuts and major investments. And we did all of that because we wrote a thoughtful budget--didn't get a lot of help from the other side, but put that aside, we did it right, we got to a budget surplus, and we created 21 million jobs. We know how do this. But we didn't see anybody playing these kinds of games: Maybe we just let the debt ceiling go and go into default. We just could not take this chance.
I thank the Senator from Illinois.
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