The Debt Limit

Floor Speech

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Mr. President, over the last 10 months, congressional Republicans have proven they are incapable of governing--at least governing productively. Instead, Republicans are governing destructively. It is hard to understand or fathom, but this seems to be what they want: destruction. It is not a word I decided to bring into the conversation today. One Republican Congressman said very recently: ``We are looking for creative destruction in how the House operates.'' This Republican Congressman said, I repeat, ``We are looking for creative destruction in how the House operates,'' and they are as good as their word in the House and sadly also in the Senate.

Time and time again, Republican leaders have brought the United States to the brink of unnecessary disaster, and sadly here we are again, facing another manufactured crisis courtesy of Republicans in Congress. This time it is a debt limit crisis. On November 3, just 2 weeks from today, our great country--the United States of America--will default on its debt unless Republicans start legislating more constructively to solve the problem. Let's be clear about what the debt limit does and doesn't mean. Adjusting the debt limit--when it is absolutely necessary, and it will be in 2 weeks--is necessary to pay this country's bills that are already due. What we face now with the debt ceiling isn't about a penny of new spending. It is not about a penny of new programs or a penny of new taxes. It is not about creating new obligations, only meeting existing ones. The debt limit is about paying what we already owe.

What are these debts? A large, large, large chunk of these is what we owe as a result of an unpaid war, a second unpaid war, and tax breaks for the rich that were unpaid for. Remember, this great theory of President Bush was that these wars would bring a new democracy to the world. Well, the invasion of Iraq was the worst foreign policy decision probably in the history of the country. Look what it has done, and it has been done at the cost of trillions of dollars of taxpayers' money, and that is part of the debt that is due.

These tax breaks for the rich. Why did the Bush administration push these tax breaks? Because it would be great for the economy. Well, it has been great for the rich people. They are getting richer, the poorer are getting poorer, and the middle class are getting squeezed. All these tax cuts were unpaid for. If we don't act, we allow the United States to default. The day of reckoning will be terrible. We will hurt American jobs, families, businesses, and the fallout will be felt around the world. If some Republicans in Congress get their way, the United States will default on this debt. What happens then? The short answer is economic catastrophe.

The former Director of the Congressional Budget Office, Douglas Holtz-Eakin, described last week what will happen if the United States defaults:

The first thing you'll see is a market reaction. Then you've got dramatic impacts on consumer confidence, the world's melting down again and they go into an economic fetal position ..... there's just no good news there.

This wasn't some leftwing blogger; this is a man who did a good job representing this country on a bipartisan basis in the Congressional Budget Office--by the way, during a Republican administration. He said:

The first thing you'll see is a market reaction. Then you've got dramatic impacts of consumer confidence, the world's melting down again and they go into an economic fetal position ..... there's just no good news there.

The Republican chairman of the House Ways and Means Committee, a reasonable Paul Ryan, said as much last week:

If the United States missed a bond payment, it would shake the confidence of the world economy. All kinds of credit would dry up: loans for small businesses, mortgages for young families. We could even go into a recession.

That is what we will face in 2 weeks if Republicans don't get their act together, and by all signs, it doesn't appear they are going to. All signs indicate that House and Senate Republicans are still not serious about dealing with the debt limit. If they were serious about paying our bills and keeping America on sound economic footing, they would not be proposing an absurd idea of having a ``partial default.'' You can't be partially pregnant; you can't have a partial default. House Republicans have engineered legislation to pick and choose which debts to pay and which to ignore.

Listen to this: Their proposed legislation is going to pay foreign creditors first, such as China, but they don't want to meet our obligations to veterans, Medicare beneficiaries, and millions of middle-class Americans. No. They want to start paying down the debt we owe to China. Think about that. The truth is this pay-China-first approach is just default by another name. This approach would lead a middle-class family into financial ruin, and just imagine what it would do to world markets. I repeat: There is no such thing as a partial default. A partial default is a default.

We can't allow the Federal Government to be delinquent in paying its debts. We have 2 weeks to get something done, and we can if the Republicans come to their senses. This unnecessary drama over paying our bills is already rattling the financial markets. The bond market has already been hurt, and we can see it.

I say to my Republican friends, especially the leaders in the House of Representatives and the U.S. Senate: Start governing in a way that is not an embarrassment to Congress and the American people.

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