Johnson City Press - Corker in Town to Sell Plan on Controlling National Debt

News Article

By Gary B. Gray

Feisty freshman U.S. Sen. Bob Corker, R-Tenn., is hustling around the state with an in-your-face style slide show meant to jolt constituents into action over the mounting national debt.

Corker is trying to build support for a bill that would cap federal spending at a level the nation's economy can handle, a message he delivered on his 58th birthday Tuesday to the Rotary Club of Johnson City at the Johnson City Country Club and later to the Johnson City Press editorial board.

"I really do think we're heading toward some serious tensions in our country if we don't deal with this," he told more than 200 people in attendance. "If you spent time with me in Washington and watched how they spend your money, you would be embarrassed."

The groundwork is being laid for a bill he plans to introduce in January that would limit spending to a percentage of the country's gross domestic product -- the total of the country's goods and services sold in a year.

To prevent a credit collapse, Corker recommended capping spending between 18 percent to 21 percent of the GDP. His strong preference is for the prior.

After being introduced, Corker wasted no time in grabbing the microphone and pointing to the projection screen.

"To get back to spending 18 percent of the GDP, we would need to cut $6.7 trillion over the next 10 years," he said.

Corker said the national debt is scheduled to increase by 2030 to 146 percent of the gross domestic product, compared to 62 percent today, according to Congressional Budget Office projections. This growing debt will push interest payments on the federal debt up from 6 percent of all federal spending today to 25 percent by 2035, he pointed out on a colored chart.

"Now," he continued, drawing attention to the next chart, "In 2008, the average Tennessee household earned $43,000. With Washington (D.C.) logic, they would spend $74,000 -- that's $31,000 more," he said, while using the numbers to draw a revenue/expenditure comparison to federal spending.

The next chart showed a drastic change regarding the growth of investors outside the country financing America's debt. In 1960, foreigners held only 5 percent of the national debt. Today, they hold 46 percent, with 10 percent held by Chinese investors, Corker said.

"Last year, the federal government paid $187 billion in interest on debt," he said. "In 2020 that's projected to be $916 billion. The entire Tennessee budget is about $35 billion. There's plenty of blame to go around. Republicans and Democrats -- both sides have gotten us in this predicament. At the end of the day, does it really matter how we got here?"

Meanwhile, of this year's federal spending, 52 percent is for discretionary spending such as defense, highways and education, 42 percent for mandatory, or entitlement spending such as Medicare, Medicaid and Social Security, and 6 percent for interest payments.

In 25 years, however, only 26 percent of the budget will be available for discretionary spending while 49 percent will be spent on mandatory spending and 25 percent on debt-interest payments.

"Let's just have revenues and spending that balance out," Corker said. "It seems to me the debate we ought to be having in this country is, "hey, how much of our GDP should we be spending?'''

Though Corker is visiting 26 counties across the state during the Senate's August recess, he said he will not try to rally support for the bill in Washington until after the November elections. He said he is willing to negotiate the percentage but warned that something must be done soon and that Americans have "a major, major issue on our hands."

"If nothing is done, our children and grandchildren will be left with crippling debt," he said. "If we don't deal with this very soon, our national security will wither away."

Corker also said the administration needs to stop making "sweeping" changes.

"It makes businesses very uneasy, and I think the Fed is about out of bullets."

Alexander Borla, Borla Performance Industries founder and CEO, complimented Corker after the meeting.

"He's the only one that's had the courage to step up," he said.

Corker is a member of the Senate Subcommittee on Security and International Trade and Finance, which oversees export and foreign trade promotion, federal export controls and financing and international economic policy.

He was the key Republican player in a bipartisan attempt to work out a compromise in the financial reform bill headed by Connecticut Democratic Senator Christopher Dodd. Corker spent nearly a year on the bill and felt strongly he could win over at least 25 Republican senators to support the measure if it included a form of consumer protection -- in this case, assurance that the bill would be fully funded.

The measure was gaining speed but lost steam in the midst of the national debate on health care reform. The first version of Dodd's bill would have taken away some of the Federal Reserve's power to oversee banks. But that changed, and Dodd "left me standing at the altar," Corker said in March during a visit to Johnson City.

"It's fair to say this (Obama) administration has the least amount of folks with private business experience," Corker said later in the editorial board meeting. "Eight percent. Only 8 percent. I think they've suffered from a lack of experience of listening to folks with private sector experience.

"The stimulus? We stimulated government," he added. "I don't think the administration understands how a span of unpredictability affects people. I think (Obama) let health care govern everything, though the economic situation was the leading issue."

Corker began the day by addressing a joint meeting of the Greene County Partnership's Executive Committee and the Greene County Industrial Board. After the stop in Johnson City, he addressed a business leaders meeting hosted by the Elizabethton-Carter County Chamber of Commerce.

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