Increasing the Debt Limit
INCREASING THE DEBT LIMIT -- (House of Representatives - November 16, 2004)
The SPEAKER pro tempore (Mrs. Musgrave). Under the Speaker's announced policy of January 7, 2003, the gentleman from South Carolina (Mr. Spratt) is recognized for 60 minutes as the designee of the minority leader.
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Mr. DAVIS of Florida. Madam Speaker, I thank the gentleman for yielding to me and appreciate the chance to join my colleagues.
The voters have spoken. They have elected us to return to Washington to get the job done. And one of the first things we are getting ready to do is exactly the opposite of what we should be doing. We are getting ready to charge to future generations this massive expenditure that we are enjoying the benefits of and ought to be paying for ourselves.
One of the things I would like to add to what has been discussed here tonight is folks at home say to me, Jim, what does this mean to me? These are a lot of numbers. This sounds like a fight about people in Washington. Where do I fit into this?
And one of the ways, I think, to sum this up is that today, because of the reckless spending habits and reckless decisions on tax cuts without regard to the debt and deficit, each American's share of the Federal debt today is $25,000. $25,000. Every American in this country, Democrat, Republican, man, woman, child, grandfather, grandchild, $25,000 each. So instead of facing up to this fact and having a debate about how we develop a roadmap to pay-as-you-go as the gentleman from South Carolina (Mr. Spratt) has been advocating with the gentleman from Tennessee (Mr. Cooper) and the gentleman from Wisconsin (Mr. Kind), we are going to bury deep in a bill, try to hide from the public, try to pretend this does not exist. And in my State, Florida, and in the States we all represent, these historically low interest rates are going to come to a screeching halt. We have been warned by all the experts that it is inevitable that interest rates are going to begin to rise. In my community where people have a mortgage on a home, they are trying to pay a student loan, they have got credit card debt, this is going to be taking money out of their pockets, not to mention the horrific interest payments we are now paying, I think $157 billion in interest we have paid in the last fiscal year or so, money that we could be spending for tax cuts to help everybody, money we could be spending to make sure our troops are better armed in Iraq and we take care of them and their families when they come home.
So I want to salute my colleagues for calling attention to this compelling detail. It is our job to make sure that the country knows that even if someone tries to hide this in a bill, this debt limit is going up to historic proportions and we need to stop it as soon as we can.
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Madam Speaker, as this body considers another federal debt limit increase, I rise with a warning for my colleagues and the people we represent back at home. For the third time since President Bush took office, Congress is preparing to drive our country further into debt with no road map to get our nation back on track to balanced budgets.
If Congress doesn't change course, this fiscal recklessness will begin to eat away at America's economic prosperity and leave a legacy of financial hardship for future generations.
Madam Speaker, this Congress has talked a lot about family values, but where I grew up, bankrupting our children and grandchildren's future doesn't count as a family value.
Today, as parents across our nation are working hard to save money for their children's college education, the federal government has run up a $7.4 trillion bill, and they are expecting our kids to pick up the tab. That's more than $25,000 worth of debt per American resident-a tremendous burden to place on the backs of future generations.
According to the Congressional Budget Office, if we stay on this path, the debt held by the public will reach $13 trillion by 2014.
The figure doesn't even take into account the financial troubles we will face when the first of 77 million baby boomers begin to collect Social Security in 2011. So while we baby boomers are enjoying our Social Security benefits, our kids will be paying for our irresponsible financial choices.
Madam Speaker, my mother taught me at an early age that if you make a mess, you have to clean it up yourself. Well this federal debt is a disaster, and I'm not about to tell my kids that they should clean up their mess when Congress can't even clean up its own.
What kind of example will we be setting for our kids if we don't take steps to pay down the debt? How can we teach our kids about the negative consequences of running up a credit card debt and at the same time ignore the consequences of running up the federal debt?
The truth is Americans are already beginning to see the effects of their government's poor fiscal policy decisions. Peter Hooper, chief U.S. economist with Deutsche Bank Securities Inc. notes, "The bottom line here is, if we don't get a significant narrowing of the budget deficit, you're going to have increasing upward pressure on interest rates. (WSJournal 11/12/04)"
In fact, according to Freddie Mac, just this week the 30-year mortgage rate came in at 5.76 percent, an increase from 5.7 percent a week earlier. Rates on 15-year mortgages, meanwhile, climbed to 5.26 percent from 5.08 percent over the same time span. Finally, the one-year adjustable mortgage rate rose to 4.16 percent this week, up from 4 percent a week ago.
Higher interest rates hurt more than just the economy-they take money right out of the pockets of young people struggling with student loan and credit card debt. And for families buying a house, higher interest rates could add literally thousands of dollars a year to their mortgage.
Furthermore, the federal debt drains funds away from investment in a better future, better education, a better environment, or scientific research. In 2004 alone, U.S. taxpayers wasted $159 billion on interest payments on the federal debt-thats more than two times the amount the government provided in financial aid for college students.
The $159 billion in interest payments combined with $163 billion in interest paid to the Social Security Trust Fund and other government trust accounts averages out to a staggering $1,100 "debt tax" for each American. For Americans facing lower paying jobs, higher housing costs, and mounting student loan and credit car debt, federal fiscal mismanagement just adds to their burdens.
And this problem will only get worse. By 2014, the interest alone on the public debt will reach $348 billion under current law (that's $1,081 per person), and will reach $418 billion under the President's policies.
It is shameful for Congress to even consider increasing this limit once again without including some sort of plan, such as enacting Pay-As-You-Go (PAYGO) rules, to ensure a brighter future for our children.
The road to fiscal responsibility is paved with sacrifice and tough choices, but the reward-a stronger, healthier economy for Americans of all ages-is well worth the journey.
I urge my colleagues to take up the responsibility thrown off by our leadership and vote against this debt limit increase.
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