(Senate - October 12, 2013)

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[Pages S7427-S7430]
From the Congressional Record Online through the Government Publishing Office []


  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. HARKIN. Mr. President. I understand that we are in session for 
Senators to speak for up to 10 minutes?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. HARKIN. I thank the Presiding Officer.
  Mr. President, we are here on Saturday, and we just had a very 
significant vote in the Senate. The vote was on whether we would move 
to a bill, fully debatable, to raise the debt ceiling without any 
strings attached.
  The Republicans, en bloc, voted against that. As a result--since we 
need 60 votes to bring a bill to the floor--the vote was 53 to 45. 
There should be no mistake in anyone's mind. This was a very clear 
vote, simply to move to a bill, fully debatable, amendable even, but 
the Republicans would not even vote to go to that bill today.
  Quite frankly, I must admit that when I was driving in to the Senate, 
I was thinking about this. I thought what we will do is that we will 
get on the bill. Obviously they will vote for cloture to proceed to the 
bill, and then we will get on the bill. I was wondering to myself how 
long we will have to be on the bill, what kinds of amendments would be 
offered, and then would we have to file cloture on that bill also.
  I was quite surprised to see every Republican vote against even going 
to the bill. It begs credulity. I am incredulous at this, especially 
with the markets opening in Asia later tomorrow, on Sunday. How are 
they going to read this? I think if we had voted to at least move to 
the bill and debated it, they would have stabilized somewhat because 
they would say at least they are willing to talk about it. Now they can 
look at the bill and say simply, Republicans are not going to discuss 
  It is shocking that this would have transpired today at this last 
minute. No one gave up anything in the bill. It was simply to move to 
the bill, and the Republicans said no.
  We have been closed for 2 weeks. I have come to the floor several 
times, as I know others have, to talk about this irresponsible and 
dangerous episode in our Nation's history. I understand that different 
groups are coming together trying to float some kind of an idea.
  I hope something comes of it. I truly hope cooler heads will prevail 
and we will reach some agreement that will allow the government to 
reopen, allow the debt ceiling to be extended with no strings attached 
for at least 1 year or more--at least to get us through the next 
elections of 2014--and then we ought to go to negotiations.
  Our Budget Committee passed a budget. The House passed its budget. 
They should meet and try to work it out in conference. Our 
Appropriations Committee passed our bills. The House hasn't passed all 
of them. Then we could go to work and work these things out in the next 
6 weeks, up to December 1. I hope that works and we get that kind of a 
compromise, but I do not want to see some kind of compromise which says 
to one side or the other that you have to do this or you have to do 
  It should be open. Our Budget Committee is under the able guidance 
and direction of Senator Murray of Washington. I am not a member of the 
Budget Committee, but they ought to go to conference without any 
strings attached or some artificial levels put in. They ought to take 
what we passed as the budget, as the House did.
  What is happening is that--and it is getting worse every day, another 
week, another 2 weeks--it is unfathomable how many more people are 
going to be hurt.
  A lot of Americans may think sequestration wasn't a big deal or that 
closing the government wasn't. I saw a piece in the paper where some 
tea party people were meeting. What came through is they weren't being 
directly hit or hurt by the government shutdown.
  One respondent was quoted in the paper as saying: We need to go back 
to the late 1800s, the way this country ran then, where everybody grew 
their own vegetables.
  I would say to that person: If you want to grow your own vegetables, 
you can grow your own vegetables. If you want to live somewhere without 
electricity, air conditioning, with no health care, and never go to the 
doctor, you should be able to do that. But why should you make the rest 
of the country go back to the 1800s?
  This is what a handful of people are trying to do. They can't do it 
legislatively, they can't do it through the courts, they can't do it 
politically, and they can't win elections on that basis. So they are 
trying to do it by holding a gun to our heads, keeping the government 
closed, and threatening to default on the full faith and credit of the 
United States.
  I wish to say in the few minutes I have remaining what another 
yearlong sequester would mean in human terms. These are things that 
come under the jurisdiction of my Appropriations Committee, which I 
have been privileged to chair or where I have been the ranking member 
since 1989. We have never had these kinds of problems before--
Republicans or Democrats--when Republicans ran it or Democrats. I have 
been back and forth on this many times, in terms of Republicans 
chairing it--Democrats, Republicans, Democrats. We have never had these 
kinds of problems.
  If we go 1 more year under sequester, that means 177,000 fewer 
children will get Head Start services--177,000--and 1.3 million fewer 
students will receive Title I education assistance. What is Title I? 
This goes to the poorest kids, the poorest families, the poorest areas. 
So 1.3 million low-income kids won't be helped.
  Oh, our kids will be fine, kids from the middle class, the upper 
class, and of Senators and Congressman. They have money. I am talking 
about the poor kids, and there are 1.3 million.
  There are 760,000 fewer households that would receive less heating 
and cooling assistance under the Low Income Home Energy Assistance 
Program, LIHEAP, and mostly they are elderly poor people.
  There will be 9,000 fewer special education staff in the classroom. 
In other words, under IDEA we provide money for special education 
teachers and support staff for special education students, and 9,000 
will be cut.
  There will be $291 million less for childcare subsidies for working 
families, for people who need childcare subsidies. They are low income, 
they are going to work every day, but they need some childcare help--
$291 million cut away from that. How many will not be able to go to 
work or what will they do with those children? Will they put them in 
substandard childcare facilities?
  One thing that is mind-boggling is we have a program in Medicare that 
goes after fraud, waste, and abuse. We know from the past that for 
every dollar that we put into that, we actually recover $7.90. I don't 
mean something phony. I mean we actually bring back $7.90 for every $1 
dollar we put into it.
  Because of the cut under sequester that means in the next year there 
will be $2.7 billion that we will not recover. By reducing the number 
of people in the fraud, waste and abuse section, that means it opens 
the door to fraud. People say: Oh, they are not there. They are not 
checking, right?
  People say: Well, now we are going to give them flexibility under 
sequester. But there is no flexibility. That has to be cut.
  Another yearlong continuing resolution under sequester means $2 
billion less for the National Institutes of Health, which means 1,300 
fewer research grants.
  Again, I would say that people say: Well, we will give flexibility. 
My colleague on the other side says: We will have sequester, but we 
will leave flexibility to the departments.
  Let's see how that goes.
  The funds for the Administration for Children and Families--what 
would they do? Would they preserve Head Start slots by cutting 
childcare subsidies?
  At NIH, would you preserve cancer research by cutting Alzheimer's 
research? These are terrible choices. Flexibility does not answer these 
questions. It is not the answer.
  When they talk about flexibility, I know what is on their mind--
military spending. Everybody likes to talk about the sequester and the 
level of sequester. Do you know what the House did? A sequester says it 
is 50/50, 50 percent cut from defense, 50 percent from

[[Page S7428]]

nondefense discretionary. What the House did in the Ryan budget was to 
leave things whole and take it out of things like Head Start, IDEA, 
special education, and programs such as that. They took it out of 
there, but they left defense whole. That is not at all what was in 
  In my area of Health and Human Services, education, labor, Centers 
for Disease Control and Prevention, NIH, next year we would cut about 
$34 billion. People will say, I don't know what that means. As I said, 
it is how many more children will not be in Head Start, how many more 
families will not get childcare subsidies, how many more research 
grants will not be funded by the NIH. We will not have our Centers for 
Disease Control and Prevention epidemiologists out in the field 
watching for food outbreaks, food-borne illnesses, et cetera.
  It is a disaster if we continue with the yearlong sequester and a 
continuing resolution. That is why we need a short-term one, so our 
committees can go to work. Perhaps cooler heads will prevail, and we 
can get a better budget for next year before the end of the year. To 
me, this is the way to proceed.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Pennsylvania.
  Mr. CASEY. I commend the words of our chairman, the senior Senator 
from Iowa, for his warnings about the impact of sequestration and the 
across-the-board indiscriminate cuts. We are grateful for that because 
we need to be thinking about what happens down the road when we have a 
budget agreement.
  I want to start today with a brief comment on what happened earlier. 
At about noontime we had a vote, which is a procedural vote which I was 
hoping would go in a certain direction, but it didn't. It was a vote to 
move forward on the question of how we are going to avoid default. I 
don't think it is the last word on this issue for the next few days, 
but I was hoping that the Republicans would at least allow a debate on 
how we can avoid default. So far that hasn't happened, but we are 
confident that in the next couple of days we will resolve this. But I 
do think it is important we lay a foundation for why we need to avoid 
default, because we have talked a lot about the consequences and the 
impact of a government shutdown--and that remains what might be called 
a clear and present danger to the middle class and to our economy--but 
we have to talk at the same time about the consequences of default 
because we are only days away from the deadline.

  Maybe the best way to start is not with numbers but with part of a 
letter I received from a constituent this week. The letter was dated 
October 8, so my assumption is that most of what is contained in this 
letter are fears about and the impacts from the shutdown only. The 
sentiments expressed in this letter will only grow in significance and 
severity as we get closer to the deadline and closer to default. I am 
reading just in pertinent part. This particular constituent is from 
northeastern Pennsylvania, about an hour from where I live, but in the 
same basic region. She talked about her own circumstances and that of 
her husband and then she continued on:

       Besides our personal difficulties due to the budget 
     impasse, my elderly parents live with the worry of when and 
     if they will receive their Social Security checks. At 85 and 
     83 they should not have this uncertainty. These should be 
     their golden years. It breaks my heart to hear my mother say 
     she can't sleep and has a stomachache from the worry about 
     where our country is headed. Middle- and low-income families 
     cannot afford another economic downturn. We are just barely 
     recovering from the last one.

  That is what she says about her parents. Now, again, it is my 
assumption the worry and the anxiety expressed in that paragraph are 
solely attributable to the government shutdown. Those worries and 
anxieties, and, frankly, real pain, the physical pain expressed in that 
paragraph about her mother, will only grow the closer we get to 
default, because we know the consequences of default are almost 
unimaginable--about the worst economic hit we could take as a country. 
So that is why we have to take every step necessary to avoid it.
  But I think the words of a constituent from Pennsylvania speak in 
this case for the Nation. Why should people have a worry, even if that 
worry is unfounded? We know Social Security checks are going out now, 
thankfully, but they are slowed down substantially if there is a 
default. We know even in a shutdown, if you reach the age of 65, it is 
going to take you a while to get the checks you are entitled to because 
the process of validating your eligibility is held up. But why should 
there be uncertainty? Why should any mother or father or grandmother or 
grandfather have an anxiety and a worry that leads them to have a 
stomachache, in the case of this letter, or where they can't sleep 
because of the political agenda of one part of one political party in 
one House of Congress?
  So that is where things are with people's feelings and their 
anxieties, and we have to be able to respond to that.
  The default question itself is of great significance now. Maybe 10 
days ago it wasn't, but I am afraid we are in a period now where just 
the talk of default, just getting close to default, will have an 
adverse impact on our economy. This did happen in 2011. That is 
irrefutable. All the data, all the facts, show just getting close to 
default has an adverse impact on the economy. By one estimate, a recent 
estimate, that was almost a $20 billion hit to the economy, if you 
measure it over 10 years. There are all kinds of other consequences 
that I won't dwell on right now.
  There were two statements made by Secretary of the Treasury Jack Lew 
in his opening statement to the Finance Committee on Thursday morning 
that I think we should be reminded of. This was in reference to the 
question, what if you go over the line in default and you have to 
decide which bills to pay, which is the wrong way to go, but Secretary 
Lew posited these two questions.

       How can the United States choose whether to send Social 
     Security checks to seniors or pay benefits to our veterans?

  That is question No. 1. Question No. 2.

       How can the United States choose whether to provide 
     children with food assistance or meet our obligations to 
     Medicare providers?

  These are the kinds of questions we are all going to have to answer 
if we--as some people apparently want us to do--go over the default 
line for the first time in American history. To say it is fiscal 
madness doesn't begin to describe it.
  Secretary Lew also said something else which we should contemplate 
today. He said:

       It is irresponsible and reckless to insist that we 
     experience a forced default to learn how bad it is.

  We have heard talk in this body and in the other body about maybe we 
can survive if we go over the line; that maybe it is okay, maybe we can 
prioritize payments. I think we should be reminded of those words. 
Again, that quote:

       . . . to insist that we experience a forced default to 
     learn how bad it is.

  It makes no sense and, fortunately, there is a consensus against it, 
but we still have work to do to prevent it from happening.
  I will read as well a couple of lines from a letter I received from a 
friend of mine who has spent a lot more years in the financial markets 
and has spent a lot of years trying to get both parties in Washington 
to come together fiscally. I will read some lines from this memo he 
sent me. He was talking about what happens with default. It is like 
anything else--if you default on your mortgage, if you default in your 
personal life, you have a credit problem. He said:

       From the standpoint of our creditworthiness, a default is a 
     default. Once you have defaulted, you are a--

  And I will leave the word out he put in there because it may not be 
appropriate for this Chamber, but I think people can figure out what 
the word might be here.--

     And everyone fears they will be the next party not to be 
     paid. As in the Lehman bankruptcy--

  And here he is talking about the fall of 2008.

     the potential for unintended consequences that spiral out of 
     control is enormous. In short, toying with default is not 
     akin to playing with fire but is more like handling financial 
     weapons of mass destruction. It is a violation of the trust 
     we place in our elected leaders to safeguard the welfare of 
     our country.

  That is what this person, who I know has a lot of experience in the 
markets, describes could happen in the event of default.

[[Page S7429]]

  I will conclude with some quick references to the impact of default 
as described by economists, as described by experts in the field of 
measuring the impact of default, and folks who know a lot about what 
would happen. I will read them as quickly as I can, because we know 
some of these already but we have to remind ourselves: Increasing 
borrowing costs. Many have talked and written about that. Damaging 
economic growth. Higher interest rates. Higher debt payments. Slow 
economic growth.
  One expert was talking about the Lehman bankruptcy and then putting 
that in the context of a default, and making the case that a default 
has a much bigger impact than even the Lehman bankruptcy had.
  Consider this: In 2008, the Lehman bankruptcy was an ``event that 
triggered the financial crisis that caused the stock market to lose 
half its value over just 5 months and helped to trigger the worst 
recession since the Great Depression.''
  That was just the Lehman bankruptcy. Imagine in the context of 
default how much worse it could be.
  Retirement savings. According to newer data, an equivalent hit could 
cost--comparing it to what happened in 2011--the average person in his 
or her fifties, who has been saving for 20 or 30 years, as much as 
  Mortgage payments would be hiked. After the 2011 shutdown, mortgage 
spreads jumped by 70 basis points, which would have added $100 per 
month to the cost of a typical mortgage.
  So we have data from 2011 that measures the adverse impact on 
mortgages just by getting close to default, not in the event of default 
  Disrupted payments. Delayed or disrupted payments would prevent 57\1/
2\ million Americans from receiving Social Security benefits in a 
timely manner and interfere with payments to 3.4 million veterans.
  I will read two more. Moody's chief economist Mark Zandi, who has 
testified in front of the Senate many times--who, parenthetically, as 
relates to the shutdown testified yesterday over in the House, because 
the Joint Economic Committee is a joint committee--predicts that, just 
as it relates to the shutdown, in this fourth quarter, the fourth 
quarter we are in, we will have lost \1/2\ point of growth. So instead 
of the GDP growth in the fourth quarter being 2\1/2\ percent, as Mark 
Zandi would have projected absent a shutdown, with the shutdown we will 
go from 2\1/2\ percent growth to 2 percent. That is a shutdown in one 
quarter. Just imagine the impact on growth if we default.
  Here is what Mark Zandi says. I am quoting him directly:

       It would be devastating to the economy. Confidence will 
     evaporate, consumer confidence will sharply decline, 
     businesses will stop hiring, consumers will stop spending, 
     the stock market will fall significantly in value, borrowing 
     costs for businesses and households will rise.

  And he goes on from there. But, look, you don't have to be an 
economist to know the impact of default. All you have to do is read 
what economists are saying across the board. These are people who 
disagree on a lot of things. They might disagree on a budget item. They 
might disagree on econometric modeling. They might disagree on tax 
cuts. They might disagree on a usual Democrat versus Republican 
approach to the economy. They might have fundamental disagreements on 
everything, but on this they are speaking with one voice: Don't 
default, they are telling us. Don't even get close to defaulting. Don't 
even talk about or debate defaulting. Just prevent it from happening. 
That is the overwhelming consensus.
  Let me conclude with one reference here. When I got to the Senate, 
one of the leading Republican voices on the budget--because he happened 
to be the ranking member on the Budget Committee--was Judd Gregg from 
New Hampshire. He had been a Governor of New Hampshire and then served 
in the Senate for many years. This is what he had to say recently in 
talking about what would happen in the event of default and 
brinkmanship with the debt limit.

       [It] is the political equivalent of playing Russian 
     roulette with all of the chambers of the gun loaded. It is 
     the ultimate no-win strategy. A default would lead to some 
     level of chaos in the debt markets, which would lead to a 
     significant contraction in economic activity, which would 
     lead to job losses, which would lead to higher spending by 
     the Federal Government and lower tax revenues, which would 
     lead to more debt.

  So says the former ranking member of the Budget Committee, the former 
Republican Senator from New Hampshire. So the idea that some think for 
some reason we could go into default or even get close to it doesn't 
make a lot of sense.
  I will conclude with this thought. That letter I started with from my 
constituent in Pennsylvania, who speaks for the country, I believe, 
when she was talking about her parents--her 82- or 83-year-old 
parents--and about the uncertainty they have, about the worry and the 
anxiety that is literally causing, in the case of her mother, according 
to this letter, physical pain, but even if it didn't rise to that 
level, just the idea of a government shutdown coupled with the 
potential default is causing that kind of anxiety and is really 
disturbing, and I think it is an insult to so many Americans.

  We have to come together and open the government at long last and 
make sure we pay our bills and not even get close to defaulting, and 
then we can have negotiations and discussions for weeks and months 
about long-term and short-term issues. In the meantime, we have to make 
sure we pay our bills and open the Federal Government.
  Mr. President, I yield the floor, and I suggest the absence of a 
  The PRESIDING OFFICER. The clerk will call the roll.
  Ms. LANDRIEU. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Ms. LANDRIEU. Mr. President, as we exited the Chamber to go to our 
Democratic caucus, I am certain my Republican colleagues and friends 
were talking among themselves as well, trying to find a way forward.
  A reporter stopped me and said: What do you think the Senate is going 
to do?
  I don't know the specifics, but I am most certainly hopeful and 
remain cautiously optimistic that the Senate will step up to the job at 
hand and fulfill the promise and hopes of our Founders, who created the 
Senate to operate at times just like these where there seems to be no 
way forward, to find a way forward; where the political winds have 
gotten so bitter and cold, for the 100 of us to find a way forward to 
help keep our economy whole and operating and functioning well, not 
just for our Nation but for the world, which is important; to help 
support and bolster the recovery that is underway; to set aside the 
bitterness and the rancor and try to find a way forward.
  I am very encouraged despite the fact that the vote was very 
divisive--all Republicans on one side and all Democrats on the other. I 
am confident because I know Members of this body well and I have been 
here long enough to know that the many people of good will on both 
sides of the aisle can try to find a way forward. And I know the 
President of the United States is open to negotiation.
  Maybe we can find resolution within the political parties, but that 
is not what is important. What is important is finding a resolution in 
the Senate of the United States for all of the people of the United 
States. We do not represent narrow districts with narrow ideologies. We 
represent States--big ones, such as California, medium-sized ones, such 
as Louisiana, and small ones, such as Delaware. But inside of Delaware, 
inside of Louisiana, and inside of California, there are people of all 
different political persuasions. As Senators, when we run for office we 
have to listen and take all of that in and then try to make the best 
decisions we can. It is an honor to serve in the Senate even though it 
is tough, it is hard, and it is very difficult at times.
  I have been proud to serve here for 18 years and be among many groups 
that have found compromise and the middle ground, that have tried to 
work to understand where the other side is coming from and move our 
country forward. It has not always been perfect, and none of us are 
perfect here, but I am proud I have at least been one to say: Count on 
me to try to see what we can do to resolve the situation. I want to say 
that today for my constituents. That is what they want me to do. That 
is what they sent me here for 18 years ago and what I know they want me 

[[Page S7430]]

continue to do. I do feel strongly on their behalf that the government 
should open and the 21,000 of them who have been wrongly laid off by 
the actions of a minority--the government needs to open, and the debt 
of the United States most certainly needs to be honored so this 
economic recovery can continue.
  But there are plenty of things we can negotiate. The debt of the 
country is too high. We do need to have some earned benefit and 
potential entitlement reform--not necessarily cutting benefits from 
people who count on them but for the government to do its part to meet 
people halfway. There are always efficiencies that can be created if we 
work together.
  So on behalf of my constituents, I am very hopeful that we can find a 
way forward. I think Senator Reid has been providing extraordinary 
leadership, and hopefully we can find a way forward.
  I would briefly mention that there have been some very good 
conversations going on about funding for the city of Washington--not a 
part of the Federal Government--which has not been resolved yet, but 
Republicans, Democrats, and the White House are working together to 
find a way so the District of Columbia, the city of Washington--with 
its own mayor and city council, its own budget, its own local funds--
does not have to be caught up in a very tough circumstance that is not 
of their making. They are not part of the Federal Government, and 
neither is New York, Chicago, New Orleans, or Baltimore. They are 
separate cities, and they should be treated that way. We haven't found 
a way yet, but we are working on it.
  I yield the floor.
  Mr. REID. Mr. President, I appreciate the kind words of the Senator 
from Louisiana, but I want the Record spread with the work she has done 
that I have seen in our years together in the Senate. No one has been 
more of an advocate for a State than the senior Senator from Louisiana. 
What she did after that terrible hurricane hit that area is now 
legendary--the ability that she had to change what had been standard 
procedures and law in this country for decades. We changed that for a 
lot of reasons. One was her advocacy. We did it because of her.
  In fact, the Democrats in the Senate voted for things they never 
voted for before because of the good Senator from Louisiana. It was not 
done to help on a temporary basis but long term for the State of 
  I hope they understand what a difference one person can make. She has 
made a difference and she has changed things forever in Louisiana 
already. I am sure the best is yet to come.