Sen. Toomey Holds Press Conference On Bill To Protect Seniors And Active Military

Press Conference

Today, U.S. Senator Pat Toomey (R-Pa.) held a press conference with his congressional colleagues introducing the Ensuring the Full Faith and Credit of the United States and Protecting America's Soldiers and Seniors Act. The legislation will require the Treasury secretary to prioritize payments for debt service, Social Security and active duty military pay.

Sen. Toomey's legislation is co-sponsored by 31 senators: Sens. Kelly Ayotte; John Barrasso; Roy Blunt; John Boozman; Saxby Chambliss; Dan Coats; Tom Coburn; John Cornyn; Mike Crapo; Jim DeMint; Mike Enzi; Lindsey Graham; Chuck Grassley; Orrin Hatch; Dean Heller; John Hoeven; Kay Bailey Hutchison; James Inhofe; Johnny Isakson; Mike Johanns; Ron Johnson; Mark Kirk; Mike Lee; Richard Lugar; Jerry Moran; Rand Paul; James Risch; Pat Roberts; Marco Rubio; David Vitter and Roger Wicker.

A full transcript of the senator's remarks is below:

"Although the president's speech last night didn't give me a great deal of cause for confidence, I nevertheless still hope that the president will drop his insistence on a huge tax increase, drop his opposition to pursuing a balanced budget so that we can reach an agreement on raising the debt limit prior to Aug. 2.

"But at this late stage in the process, it's obvious now to everybody that it is possible - increasingly possible - that we will not have raised the debt ceiling by Aug. 2. And if Aug. 2 does indeed pass without the debt ceiling having been raised, we believe it is absolutely essential that the federal government have a plan for prioritizing the payments that can and should and really must be made, using the resources that the government will have, especially ongoing tax resources.

"Now some of us have been making this argument for many, many months now. Unfortunately, the administration has persisted in denying that it can or will prioritize payments in this scenario. Instead, they've persisted in predicting a default, implying in fact that they will choose to default on our bonds. In a letter to Congress, Treasury Secretary Timothy Geithner said in May, and I quote, 'This would be an unprecedented event in American history. A default would inflict far-reaching damage on our nation's economy, significantly reducing growth and increasing unemployment.' President Obama said on May 15 of this year, and I quote: "If investors around the world thought that the full faith and credit of the United States was not being backed up, if they thought we might renege on our IOUs, it could unravel the entire financial system. We could have a worse recession that we already had, a worse financial crisis than we already had.'

"The fact is, it's entirely within the power of this administration to avoid that very scenario, regardless of whether or not we raise the debt limit prior to Aug. 2. These are scare tactics. They have been meant to intimidate Congressional Republicans into voting for the package that the administration wants. Frankly, it's irresponsible and it's dangerous. The administration should not be threatening to make the debt ceiling impasse more disruptive than it needs to be.

"Now there are published reports that Treasury officials are calling big bank executives and assuring them, privately, that if the debt limit is not raised, they - the Treasury Department - will nevertheless ensure that there is no default on our bonds. Well, that's all well and good for the administration to provide that assurance to friends on Wall Street. I think it's about time we provide that assurance to senior citizens around the country.

"That's why we're introducing a bill that we're unveiling today, Ensuring the Full Faith and Credit of the United States and Protecting American's Soldiers and Seniors Act. I'm delighted to report that as of this moment, we already have 31 cosponsors in the Senate, the number has been growing consistently. What our bill would do is it would instruct the Treasury secretary in the event the debt ceiling is not raised prior to Aug. 2 to make certain obligations priority so that they will be paid in full, on time, and without delay.

"The three priorities are simple. First, it's interest on our debt so that we will not default on our debt and not plunge our economy into chaos. Second, Social Security payments because millions of senior citizens, including my parents, depend on the Social Security payments that they've earned by virtue of their own prior contributions to the system. And finally, the payroll for active duty military personnel because the men and women who are risking their lives for us should not have to worry about whether their families will receive their income in a timely fashion.

"Now as this chart illustrates, there are far more than enough resources for the administration to make these payments and, frankly, many others. From the period Aug. 3 through Aug. 31, total revenue will be at least $173 billion, perhaps much more, and the combined costs of paying the interest of our debt, Social Security payments and active duty military pay will be about $81 billion, so less than half of the revenue that will be coming in during the month of August. These numbers, by the way, are not made up by somebody in my office. These are the numbers provided by the Bipartisan Policy Center. They've been confirmed by many other sources.

"Let me close by saying this. This bill is not and is not meant to be a substitute for raising the debt limit. I, and I suspect most of the folks on this stage, have actually voted in favor of raising the debt limit providing we put our government on the path to a balanced budget. What this bill is all about is minimizing whatever disruption might otherwise occur if the debt limit is not raised prior to Aug. 2. I continue to hope that this legislation never needs to be implemented, but it would be very, very irresponsible to be unprepared, or worse, to be unwilling to minimize the potential for disruption."

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