The Debt Crisis

Floor Speech

Mr. McCLINTOCK. Mr. Speaker, the debt limit exists for a simple reason: to assure that public debt isn't recklessly piled up without Congress periodically acknowledging it and addressing the spending patterns that are causing it. If a debt limit increase is supposed to be automatic, as the President suggests, then there is really no purpose to it.

A new dimension has now appeared in this discussion. Unlike every one of his predecessors, this President has vowed that unless Congress unconditionally raises the debt limit, the United States will default on its sovereign debt.

But a failure to raise the debt limit would not, by itself, cause the Nation to default. The Government Accountability Office has consistently held that the Treasury Secretary has ``the authority to choose the order in which to pay obligations of the United States'' to protect the Nation's credit. Such authority is inherent in the 1789 act that established the Treasury Department and entrusted it with ``the management of the revenue'' and the ``support of the public credit.'' The affirmative duty of the Treasury Department to do so is underscored by the 14th Amendment.

Our revenues are more than 10 times our debt payments, so paying the debt first to prevent a sovereign default is well within the financial ability of the Federal Government--and indeed, it is a fiscal imperative.

Now, earlier this year, the House passed H.R. 807, which not only explicitly requires the payment of the national debt in the case of an impasse over the debt limit, but even allows the President to exceed the debt limit, itself, in order to protect the Nation's credit. That measure languishes in the Senate under the threat of a Presidential veto.

Protecting the sovereign credit by prioritizing payments would mean delaying paying other bills. That is also untenable, unthinkable, and something much to be avoided, but it would not imperil the Nation's sovereign credit. Only the President can do that.

The House leadership met with the President last week and offered to extend the debt limit until November 22 with no strings attached. The President refused. Senate Republicans offered a 6-month extension, but the Senate Democratic leader refused.

What the President threatens to do would be catastrophic and unprecedented. The full faith and credit of the United States is what gives markets the confidence to loan money to the Federal Government. Even a threat of default--exactly the kind the President is now making--could have dire consequences to a Nation that now owes more than its entire economy produces in a year.

So where do we go from here?

Republicans have miscalculated on two key assumptions: first, that the Democrats would negotiate the issues that divide our country--they have not; and second, that Democrats would seek to minimize the suffering caused by the impasse--they have not.

Given the ruthless and vindictive way the shutdown has been handled, I now believe that this President would willfully act to destroy the full faith and credit of the United States unless the Congress acquiesces to all of his demands--at least as long as he sees political advantage in doing so.

If the Republicans acquiesce, the immediate crisis will quickly vanish, credit markets will calm, and public life will return to other matters. But a fundamental element of our Constitution will have been destroyed: the power of the purse will have shifted from the representatives of the people to the Executive. The executive bureaucracies will be freed to churn out ever more outlandish regulations with no effective congressional review or check through the purse. A perilous era will have begun in which the President sets spending levels and vetoes any bill falling short of his demands. Whenever a deadline approaches, one House can simply refuse to negotiate with the other until Congress is faced with a Hobson's choice of a shutdown or a default. The Nation's spending will again dangerously accelerate, the deficit will rapidly widen, and the economic prosperity of the Nation will continue to slowly bleed away.

This impasse may have started as a dispute over a collapsing health program, but it has now taken on the dimensions of a constitutional crisis. Yesterday, in Washington, a group of America's veterans rose up to take a stand against these unconstitutional usurpations. I believe the salvation of our Nation now ultimately depends on the American people joining them.

Source