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Public Statements

Executive Session - Nomination of Charles Timothy Hagel to be Secretary of Defense

Floor Speech

Location: Washington, DC

Ms. COLLINS. Mr. President, first, let me say, I am very pleased to join with my friend and colleague from New Hampshire to speak out against the indiscriminate meat-ax cuts known in Washington as sequestration that are scheduled to take effect in just 2 weeks' time. We simply must take action to avoid this self-inflicted harm to our economy and to our national security. But what I find inexplicable is a growing acceptance that sequestration is going to go into effect despite the fact that virtually everyone should concede that across-the-board cuts where we don't set priorities do not make sense.

There are good programs that deserve to be preserved, there are programs that have outlived their usefulness and should be eliminated, and then there are programs that could be cut and reduced. That is not the approach we are taking. We are not going through the budget in a careful way by identifying programs that could be eliminated or reduced, setting priorities, and making investments.

No, we are allowing to go into effect across-the-board cuts that fall disproportionately on the Department of Defense.

Indeed, we are already seeing the effects of these cuts on our military because each of the military services has begun planning for the likelihood of deep budget cuts. The Navy is preparing for a civilian hiring freeze and cutting workers at shipyards and base-operated support facilities.

I wish to be clear exactly who these employees are. These are the nuclear engineers, the welders, the metal trades workers repairing submarines and ships at the Navy's four public shipyards, including the Portsmouth Naval Shipyard in my home State of Maine, which employs half of its workforce from my colleague's State of New Hampshire. I know the senior Senator from New Hampshire shares the concern about this particular installation on the border we share. But, of course, the damage of sequestration extends far beyond just one installation or two States.

Just this morning I was over at the Pentagon, and I took advantage of the opportunity to sit down with the Navy's top shipbuilding official to discuss what the impact of sequestration would be for our naval fleet. Well, one example we have already seen. The Navy will keep the USS Abraham Lincoln, a nuclear-powered aircraft carrier, in port rather than repairing and deploying it. Across the fleet, the Navy is being forced to reduce deployments, maintenance, and overhauls for critical repairs. When we look at the shipbuilding budget, it is evident that sequestration and the continuation of a partial-year funding resolution, known as the continuing resolution, would be absolutely devastating for our Navy, for shipbuilding, and for our skilled industrial base. That includes Bath Iron Works in Maine, which I am so proud of, which builds the best destroyers in the world. This has consequences not only for our workforce, but also for our national security.

It is important to note Secretary Panetta has made clear that allowing these sweeping cuts to go into effect would be ``devastating,'' in his words, and would badly damage the readiness of the U.S. military.

The fact is defense has already taken a huge reduction in future spending. The defense budget has been slated to be cut by $460 billion over 10 years, and that is before sequestration. When this number is added to the defense cuts scheduled to begin on March 1, we are looking at an enormous impact on our national security.

Now, it is important to recognize we are not saying the national debt is not a problem. Certainly, when we have a $16.4 trillion debt, that is not sustainable, and the national debt is a security concern in its own right. Just last year, in 2012, the Federal Government spent $223 billion in interest payments alone. That means we are spending more on interest on the national debt each month than we spent in an entire year on naval shipbuilding and the Coast Guard budget.

Just think about that. The interest payment in one month exceeds the entire Coast Guard budget and the entire budget for shipbuilding in the Navy. The estimates are that by the middle of this decade--not some distant year--our interest payments to China, our largest foreign creditor at $1.2 trillion, will be covering the entire cost of that Communist country's military. Think of the horrific irony of that. At the same time America is bound by treaties to defend our allies in Asia against Chinese aggression, the American taxpayers are bankrolling the threat through the interest payments we are paying to the Chinese.

Neither the Senator from New Hampshire nor I am saying the Pentagon should be exempt from budget scrutiny or even future cuts, but the disproportionate impact that sequestration would have on our troops and on our national security is dangerous and it must be averted. The Department cannot continue to operate on a continuing resolution that increases costs, prevents long-term planning, and makes it impossible for the Department to function effectively.

I yield to my colleague from New Hampshire to expand on some of these points. Then we will talk further about the impact.

Mrs. SHAHEEN. Mr. President, I thank the Senator from Maine for laying out what we are seeing in terms of the potential impact of those automatic cuts. The comments and the statistics the Senator from Maine had about China and what they are going to be able to do with the money we are paying is really eye-opening and scary.

The Senator from Maine spoke about some of the impacts we are beginning to see at the ports of naval shipyards. As the Senator pointed out, it is something very important to both Maine and New Hampshire. It employs about 4,000 workers, almost evenly split between our two States. As a result of the sequester, starting March 1, one of their major projects, the repair of the USS Miami, which was damaged in a fire, is going to be halted immediately. Just stopped--16 days from now. The Navy is going to cut over 1,100 temporary civilian workers, mostly from shipyards such as Portsmouth. The needed maintenance and military construction will be postponed indefinitely. It is not just about those jobs at the Portsmouth Naval Shipyard or at the shipyards across the country, but that has a ripple effect across our economy, and it affects the grocery stores and the restaurants and all of the small contractors and small businesses doing work at those shipyards.

There will be ramifications for our national defense across the services. Yesterday, we had some harrowing testimony in front of the Armed Services Committee from all of the chiefs of the military outlining what they see coming as a result of the consequences of the sequester and the continuing resolution the Senator from Maine spoke about.

DOD-wide--so across the Department--they expect to lay off a significant portion of the 46,000 temporary and term employees. All services and agencies will likely have to furlough most DOD civilian employees for up to 22 working days. Imagine that. That is a whole month of paychecks that those workers are not going to have to support their families, to be able to spend into the economy, and that is going to have a huge impact.

It is possible that DOD might not have enough funds to pay for TRICARE, health care coverage for our veterans through the end of the fiscal year. As we saw on the front pages of the paper this week, the Department delayed the deployment of the USS Harry Truman, the carrier strike

group that was headed to the Persian Gulf. If sequestration goes into full effect, the Navy will shrink by about 50 ships and at least two carrier groups.

By the end of the year, the Navy, if we do nothing, will lose about 350 workers a week or 1,400 a month from our civilian industrial base. That will have a huge impact in New Hampshire, as I know it will in Maine as well.

So there are real, significant impacts, as the Senator from Maine pointed out, on the defense industry, on this country's national security, and on the domestic side of the budget. It is already starting to have ramifications on our economy and job growth. We saw in the last quarter of 2012 that our economy contracted for the first time since 2009, and much of that decline was due to sharp reductions in government spending in anticipation of the sequester coming into effect.

We saw it in New Hampshire, in some of our businesses that are dependent on government contracts, particularly in the defense industry. So our failure to act is not only irresponsible, but it is beginning to have a real impact in slowing down this economy.

It is simply unacceptable that we are not addressing this issue. We need to act. If we let the sequester go into effect, we stand to lose, according to the Congressional Budget Office, up to 1.4 million jobs. A recent forecast from Macroeconomic Advisers suggests that sequestration would reduce our gross domestic product by .7 percentage points this year.

We can't risk putting our economic recovery in jeopardy with these indiscriminate cuts. They are going to have an impact on research and education vital to our ability to grow this economy and remain competitive.

The National Institutes of Health would face a $2.5 billion cut. They would have to halt or curtail scientific research, including needed research in cancer and childhood diseases. The Centers for Disease Control and Prevention would see a $464 million cut. States and local communities would lose billions of Federal education funding for title I, for special education grants, and for other programs.

As many as 100,000 children will lose their places in Head Start, 25,000 teachers could lose their jobs, and we will see those impacts immediately in Maine and in New Hampshire.

I wish to turn back to the Senator from Maine to share what she is seeing in Maine.

Ms. COLLINS. Mr. President, first I wish to commend the Senator from New Hampshire for broadening the debate and reminding all of us of the macroeconomic impact, as well as the impact on our two States.

The estimate is that Maine's defense industry--which includes not just the Portsmouth Naval Shipyard, Bath Iron Works, and our Pratt & Whitney plant, but a lot of smaller contractors and suppliers--could lose as many as 4,000 jobs as a result of sequestration. Think about that. That means, as the Senator from New Hampshire pointed out, these are people who are supporting their families and who are supporting other businesses in the community. The impact, the ripple effect, is just devastating.

That is why it does not surprise me that the Congressional Budget Office has pointed to sequestration as the primary cause for the slow growth we have seen already, and CBO projects as well; that our economy would grow at a faster rate--at 2 percent--if we averted sequestration. These aren't meaningless numbers. They affect real people. The estimates are that we would lose between 1.4 million and 2 million jobs if this is allowed to go into effect nationwide.

It is also a failure on the part of Washington to make decisions. If we are going to allow these mindless, indiscriminate cuts to go into effect, why are we here? We might as well have computers or robots making decisions for us. Our job is to do the hard, painful work of setting priorities and making decisions. That is why I am so frustrated by the approach we appear to be on the verge of taking.

The Senator from New Hampshire makes a very important point. While the Department of Defense would take a disproportionate impact from sequestration, and I am extremely concerned about that, there are other important programs that would be affected as well. The superintendents groups have met with me and talked about what it would mean for schoolchildren in Maine if halfway through the school year--more than halfway through the school year--all of a sudden they get a reduction in title I money that goes to low-income schools, to special education grants, to other important programs such as Head Start, and the TRIO Program, which helps low-income and first-generation students attend and excel in college.

Think about the Low-Income Home Energy Assistance Program, biomedical research that is so critical, cuts in the FAA workforce that could reduce air traffic control, disrupting air traffic during the busy summer months.

The list goes on and on: essential education, health care, research, transportation programs that deserve support that do not deserve to all be treated the same.

Again, I want to emphasize that we recognize spending must be cut and the debt, at $16.4 trillion, is way out of control. That amounts to something like $52,000 for each man, woman, and child in this country.

We are committed to seeking pragmatic solutions through compromise and to avoiding this devastation of our economy and our national security. We recognize we have to look at all areas of spending and that we need to overhaul our Tax Code and make it more pro-growth, simpler, and fairer. If ever there were a moment when Members of Congress and the President should put aside their politics for the greater good of the Nation, now is the time.

So I, for one, want to thank the Senator from New Hampshire for caring so much about this issue. We have agreed to work together--and continue to work together--to address this. These automatic cuts were never supposed to take effect. I remember being told: Do not worry. It is never going to happen. It is too unpalatable. It will just never occur.

Well, they were supposed to force us to make the difficult decisions necessary to put our economy on a sound footing and to deal with our unsustainable debt. Our Nation's leaders--the President, Democrats and Republicans alike--have denounced sequestration for the most part, and yet here we are.

So I hope we can work together to avoid this fiscal cliff which will have such damaging effects for the people of this Nation.

Thank you, Mr. President.

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