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Public Statements

Full Faith and Credit Act

Floor Speech

By:
Date:
Location: Washington, DC

BREAK IN TRANSCRIPT

Mr. McCLINTOCK. Madam Speaker, I thank the gentleman for yielding.

I had hoped that amidst all the controversies that grip Congress, certainly we should at least be able to agree that the full faith and credit of the United States should not hang in the balance every time there's a fiscal controversy in Washington. I also want to thank Chairman Camp and his Ways and Means Committee for revisions that make this solution much simpler and more practical than the original draft.

Madam Speaker, this bill simply guarantees that the sovereign debt of the United States Government will be paid in full and on time under any circumstances.

Most States have had similar provisions to guarantee their debt in their laws or constitutions for generations. Last year, in testimony to the Senate, Ben Bernanke praised these State provisions for maintaining confidence in their bonds. He told our House Budget Committee that a similar measure at the Federal level would help to protect us against a sovereign default, which he called a ``very high priority.''

And yet, this President and his followers in Congress, who have taken our Nation on the biggest borrowing binge in its history--who've run up more debt than almost all of his predecessors put together--oppose this commonsense measure to strengthen the credit upon which that debt depends.

This bill tells credit markets that even in the event of an impasse on the debt limit, their loans to this government are absolutely safe.

The Democrats have raised three arguments in opposition. First, the whip just said that guaranteeing the Nation's sovereign debt is just an excuse for not paying our other bills. What utter nonsense. I challenge him to name one Member of Congress who has ever suggested that this measure is an acceptable substitute for not paying our other bills. Do they actually suggest that all these other States that have guaranteed their sovereign debts for generations have ever used these guarantees as an excuse not to pay their other bills?

On the contrary, by providing clear and unambiguous mandates to protect their credit first, they actually support and maintain their ability to pay for all of their other obligations.

The second argument that we have heard ad nauseam is that this bill will pay China before it pays our troops. Well, I would remind them, as the chairman said, that more than half of our debt is actually held by Americans, often by American pension funds. China holds just 11 percent. So this measure actually protects Americans far more than the Chinese.

But whether our loans come from China or from grandma's pension fund, without the Nation's credit, we cannot pay our troops or any of our other obligations.

We are borrowing a quarter of every dollar that we spend, and under this administration we have amassed a debt that is now larger than our Nation's entire economy. Our Nation's credit now carries a greater strain and burden than it ever has before. This measure strengthens our credit by guaranteeing that our sovereign debt will be paid in full and on time.

Perhaps the most bizarre argument that we've heard is that by guaranteeing the Nation's credit, we actually undermine it and risk another downgrade in our credit rating. After all, as the ranking member said, a downgrade followed the last debt debate in Congress.

Here are the facts: Standard & Poor's officials had warned for months that Congress had to reduce the projected 10-year deficit by $4 trillion in order to maintain its AAA credit rating. Because of Democratic intransigence, this Congress could only reduce it by $1.2 trillion. So we lost the rating. Facts are indeed stubborn things.

But the opponents are correct in one point--that several officials did express a concern that the impasse could have caused a default in the Nation's sovereign debt. That is precisely what this measure would protect us from in the future.

No one advocates that the government delay paying any of our bills, and this legislation does no such thing. Indeed, this legislation protects our ability to pay all of our other bills because paying those bills depends on maintaining the Nation's credit.

Given the precarious state of our Nation's finances, principled disputes over how the debt limit is addressed are going to happen from time to time. Just a few years ago, then-Senator Barack Obama vigorously opposed an increase in the debt limit that was sought by the Bush administration.

When these controversies erupt, as they inevitably do in a free society, it is imperative that credit markets are supremely confident that their loans to the United States are secure. That's what this bill does.

For once, let us set aside all this partisan posturing and act in the Nation's interest.


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