(Senate - July 20, 2011)

Text available as:

Formatting necessary for an accurate reading of this text may be shown by tags (e.g., <DELETED> or <BOLD>) or may be missing from this TXT display. For complete and accurate display of this text, see the PDF.


[Pages S4699-S4700]
From the Congressional Record Online through the Government Publishing Office []

                              HOUSE ACTION

  Mr. TOOMEY. Mr. President, I wanted to take this occasion to 
acknowledge a very important event that occurred last night. It 
occurred in the other body, where we had a vote for the first time 
since we have been deliberating and debating and wrestling with this 
challenge of what to do with our debt limit and the fact we have 
reached that debt limit. We have had a vote by one of the two bodies 
that have a say in this matter on this very issue, and the House voted 
yesterday by a significant margin, with a bipartisan vote--although it 
was mostly one-sided, there were Members of both parties--in favor of 
raising the debt limit. The House voted to raise the debt limit, in 
fact, by the full amount the President requested. The House voted to 
raise the debt limit by $2.4 trillion, which would completely eliminate 
this problem, this struggle we have had over this looming deadline we 
have been given.
  However, the vote came with one condition. It came with the condition 
that the President join Congress in putting our Federal Government on a 
path to a balanced budget. That is the requirement. That is the 
contingency. The way the House bill achieves that is by establishing 
three parts: The first is cuts in spending, the second part is caps on 
spending, and the third is a balanced budget amendment to the 
Constitution. The colloquial name this approach has been given is the 
``cut, cap, and balance'' approach.
  This is a big deal because until last night, among the three parties 
to this debate--the House of Representatives, the Senate, and the 
President--nobody had previously laid out a case that said: Here is how 
we will raise this debt limit and deal with this problem. The House has 
now done so. They have passed this measure by a significant margin.
  I would like to quickly walk through the three elements of it--the 
cuts, the caps, and the balance. They are really all different pieces 
designed to achieve one goal, which is to put our Federal budget on a 
path to balance.
  The cut refers to cuts in spending in this next fiscal year, which 
begins soon. It begins on October 1. The cut is 3 percent from this 
year's spending level--3 percent. So under the House-passed plan, next 
year we would spend 97 percent of everything we are spending this year, 
but we would cut 3 percent. Now, anybody who has run a business, 
anybody who has run a household knows that if you have to, you can cut 
3 percent from any big budget. I guarantee you, from the enormously 
bloated and oversized $3.7 trillion U.S. Government budget, 3 percent 
is not much, but that is the cut. That is the first part. That is the 
level of spending for next year--about 3 percent or $111 billion.
  The next part is the caps. These are the statutory limits as to how 
much the Federal Government would be permitted to spend in each of the 
subsequent years for the next 10 years. These levels have spending 
growth every year. Some suggest these are Draconian, savage cuts in 
spending. Actually, it is increases, but it is increases in spending at 
a slower rate than we have had in the past and certainly slower than 
what others have proposed--what the President's budget proposed and 
what the Congressional Budget Office is expecting. Therein lies 
savings. Therein lies the opportunity to put us on a path to a balanced 
budget because I think we all acknowledge that, unfortunately, we are 
not going to be able to achieve a balanced budget overnight. Can't do 
it. We have dug too deep a hole. So we need a little time to get there. 
The spending caps provide that discipline as we move in that direction.
  The final piece is a balanced budget amendment to the Constitution, 
which is something most Americans have strongly supported for a long 
time. If we achieve that, frankly, we would never have to worry about 
raising the debt limit anymore because we wouldn't run a deficit. We 
would be forbidden. Without a deficit, you don't need to issue a new 
debt, so the debt would never rise, and this problem would be 
permanently resolved, but much more important, we would have our 
Federal Government on a sustainable, strong, viable fiscal path, and 
that would create the opportunity for strong economic growth.
  I am convinced that part of the reason we are having such a weak 
economy and such poor job growth is because of the uncertainty we have 
created not so much over whether we are going to raise the debt limit 
on August 1 or 2 or 3 or whenever it is but whether we are going to 
solve the big fiscal challenge we face, the problems dragging down 
Europe now, and the problems that loom for us.
  The President and the Treasury Secretary have been extremely alarmed 
about the prospect that we might not raise the debt limit on August 2. 
To that very point, the Treasury Secretary said--and I quote from a May 
13 letter he sent to Members of Congress:

       This would be an unprecedented event in American history.

  He is referring to a failure to raise the debt limit.

       A default would inflict catastrophic, far-reaching damage 
     on our Nation's economy, significantly reducing growth, and 
     increasing unemployment.

  President Obama had a similar message of great alarm, again referring 
to a scenario in which we did not raise the debt limit by August 2. He 

       If investors around the world thought that the full faith 
     and credit of the United States were not being backed up, if 
     they thought that we might renege on our IOUs, it could 
     unravel the entire financial system . . . We could have a 
     worse recession than we already had, a worse financial crisis 
     than we already had.

  So this is how serious the President and the Treasury Secretary say 
their concern is that we raise the debt limit. Well, the House just did 
it. The House said: Mr. President, we hereby vote--and they did vote--
to raise the debt limit by $2.4 trillion, the full amount the President 
asked for. They have said this is the only condition: You, Mr. 
President, need to join us in putting our budget on a path to balance, 
taking care of this fiscal crisis, and giving us a sustainable fiscal 
footing so we can have strong economic growth.
  So the question today before us is, Will the President join us? Will 
the President embrace this? The President, as I have just quoted, has 
indicated great alarm at the prospect of not getting the debt limit 
increase he has asked for. The House has just said: Here it is.
  Actually, I think, if not every Republican Senator, a big majority of 
Republican Senators will support what the House has done. I hope there 
will be many Democrats who will support this as well because none of us 
wants to test the proposition of what happens if we don't raise the 
debt limit.
  So the opportunity is here now. For the first time, we have a bill 
that has been passed in one of these two bodies that would do exactly 
what the President has asked for, with just this one condition.
  Let me comment for a moment on one of the reasons I think it is so 
important that the President join us in putting our budget on a path to 
balance. We have heard from various rating agencies that several of 
them are considering downgrading the credit standing of the United 
States. This is an appalling thought.
  I was involved in the bond market in my first career when I got out 
of college, and the United States stood above

[[Page S4700]]

ratings. We didn't talk about having a AAA rating because we were above 
even that. Our rating was so superior to anyone else's, the rating 
system didn't even really apply to the United States. Well, now, not 
only does it apply, but the danger is that we won't even qualify for 
the top rating.
  Do you know what it is that would cause them to downgrade the debt of 
the United States? It is not a failure to raise the debt limit by 
August 2; it is the failure to address this fiscal imbalance, these 
massive, unsustainable deficits. That is what they have told us has to 
be corrected or else the downgrade follows, and a downgrade will be 
enormously problematic because it has all kinds of knock-on effects.
  So we have heard about a lot of different ideas that have been 
floated, and I congratulate and commend everybody who has been involved 
in putting in a lot of effort. I don't agree with everything that 
everybody has talked about doing, but I think we have seen people from 
both parties make a good-faith effort to try to solve this problem one 
way or another. But the fact is there is only one proposal on the table 
that has passed either body, and there is only one proposal that 
actually solves our long-term fiscal challenge in the law that has 
already passed--the bill that has already been passed.
  So my question now is, Will the President join us and put our 
government on a path to a balanced budget? We don't expect to get there 
overnight. By the way, the various levels of cuts and spending and the 
exact terms of the balanced budget amendment naturally would be subject 
to discussion. But will the President join us in this effort to restore 
fiscal sanity and give us the basis for strong economic growth? That is 
the question, and that is the opportunity for the President.
  Now, I know the President has been dismissive of the idea of 
balancing our budget, but I certainly hope he is not so opposed to 
balancing our budget that he would reject the debt limit increase that 
he has said we desperately need. There is an opportunity here to solve 
two problems at once--to solve this problem over the looming date of 
August 2 by which he has said we absolutely must raise the debt limit, 
but the more important opportunity is to put our house in fiscal order.
  The House took a very important step in that direction. The Senate 
will have a vote later this week. I hope my colleagues in the Senate 
will embrace this opportunity and the President will join us and will 
put our Federal Government on a path to balance.
  With that, I yield the floor.