US government shutdown - Page 84

Mr. President, I rise today to talk about America's debt problem.

The fact that we are here today to debate raising America's debt limit is a sign of leadership failure. It is a sign that the U.S. Government can't pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government's reckless fiscal policies.

Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion. That is "trillion" with a "T." That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President's budget will increase the debt by almost another $3.5 trillion.

Numbers that large are sometimes hard to understand. Some people may wonder why they matter. Here is why: This year, the Federal Government will spend $220 billion on interest. That is more money to pay interest on our national debt than we'll spend on Medicaid and the State Children's Health Insurance Program. That is more money to pay interest on our debt this year than we will spend on education, homeland security, transportation, and veterans benefits combined. It is more money in one year than we are likely to spend to rebuild the devastated gulf coast in a way that honors the best of America.

And the cost of our debt is one of the fastest growing expenses in the Federal budget. This rising debt is a hidden domestic enemy, robbing our cities and States of critical investments in infrastructure like
bridges, ports, and levees; robbing our families and our children of critical investments in education and health care reform; robbing our seniors of the retirement and health security they have counted on. Every dollar we pay in interest is a dollar that is not going to investment in America's priorities. Instead, interest payments are a significant tax on all Americans — a debt tax that Washington doesn't want to talk about. If Washington were serious about honest tax relief in this country, we would see an effort to reduce our national debt by returning to responsible fiscal policies.

But we are not doing that. Despite repeated efforts by Senators Conrad and Feingold, the Senate continues to reject a return to the commonsense Pay-go rules that used to apply. Previously, Pay-go rules applied both to increases in mandatory spending and to tax cuts. The Senate had to abide by the commonsense budgeting principle of balancing expenses and revenues. Unfortunately, the principle was abandoned, and now the demands of budget discipline apply only to spending. As a result, tax breaks have not been paid for by reductions in Federal spending, and thus the only way to pay for them has been to increase our deficit to historically high levels and borrow more and more money. Now we have to pay for those tax breaks plus the cost of borrowing for them. Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next 5 years. That is why I will once again cosponsor the Pay-go amendment and continue to hope that my colleagues will return to a smart rule that has worked in the past and can work again.

Our debt also matters internationally. My friend, the ranking member of the Senate Budget Committee, likes to remind us that it took 42 Presidents 224 years to run up only $1 trillion of foreign-held debt. This administration did more than that in just 5 years. Now, there is nothing wrong with borrowing from foreign countries. But we must remember that the more we depend on foreign nations to lend us money, the more our economic security is tied to the whims of foreign leaders whose interests might not be aligned with ours.

Increasing America's debt weakens us domestically and internationally. Leadership means that "the buck stops here.'' Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.

I therefore intend to oppose the effort to increase America's debt limit.

On October 10 2013 07:20 Nick Drake wrote:
Funny that I didn't hear this type of panicky "the US will go bankrupt, the world will go into the worst depression in history" sort of logic back in 2006.

On October 10 2013 07:40 Tianx wrote:

That's because there's a difference between the usual political bullshit that gets thrown around to further your agenda and actually seriously risking a global economic meltdown.

On October 10 2013 07:57 Tianx wrote:
I think everyone realizes that it's incredibly unlikely that the US is going to default. The real point is that playing chicken when you're capable of running the entire world into the ground is simply not an acceptable way to run a government.

On October 10 2013 11:56 geokilla wrote:

But if USA doesn't default, how will they repay their trillions of dollars of debt?

On October 10 2013 07:57 Tianx wrote:
I think everyone realizes that it's incredibly unlikely that the US is going to default. The real point is that playing chicken when you're capable of running the entire world into the ground is simply not an acceptable way to run a government.

On October 10 2013 07:20 Nick Drake wrote:
Funny that I didn't hear this type of panicky "the US will go bankrupt, the world will go into the worst depression in history" sort of logic back in 2006.

For those who don't know, the Senate vote on the debt ceiling in 2006 was a phenomenally close 52 - 48. And Barack Obama was one of the "no" votes on raising the debt ceiling. Of course, he's changed his tune now that it isn't about attacking a party.

Stephanopoulos: "You've got to extend the debt limit by May. And your job is a lot tougher because of your vote in the Senate against extending the debt limit. When did you realize that vote was a mistake?"

Obama: "I think that it's important to understand the vantage point of a senator versus the vantage point of a president. When you're a senator, traditionally what's happened is, this is always a lousy vote. Nobody likes to be tagged as having increased the debt limit - for the United States by a trillion dollars. As president, you start realizing, you know what, we, we can't play around with this stuff. This is the full faith and credit of the United States. And so that was just an example of a new senator making what is a political vote as opposed to doing what was important for the country. And I'm the first one to acknowledge it."

On October 10 2013 12:04 Alex1Sun wrote:

One option is to slowly (slowly enough not to trigger a recession) decrease the budget deficit by cutting spending and raising taxes, then gradually get to a budget with a surplus and start paying the debt off. It may take decades, but that is possible. Whether this course will be chosen is another question...

On October 10 2013 12:43 geokilla wrote:

Well that is the ideal way, but isn't the interest of the debt itself like millions or even billions each day? No amount of budget surplus would help. Unless they decide to be like Germany during Hitler era and mass print money. INFLATION!

On October 10 2013 12:43 geokilla wrote:

Well that is the ideal way, but isn't the interest of the debt itself like millions or even billions each day? No amount of budget surplus would help. Unless they decide to be like Germany during Hitler era and mass print money. INFLATION!

On October 10 2013 12:43 geokilla wrote:

Well that is the ideal way, but isn't the interest of the debt itself like millions or even billions each day? No amount of budget surplus would help. Unless they decide to be like Germany during Hitler era and mass print money. INFLATION!

On October 10 2013 13:15 KwarK wrote:

Your German history is out by a decade.

On October 10 2013 12:54 Nightfall.589 wrote:


Unlike Uncle Mike and his credit cards, the USG borrows at very low rates[1]. Paying off debt (Principal and interest) is less then 6% of the national budget... And less then 1% of the nation's GDP.

For contrast, five times that amount is spent on... Outspending the rest of the world's militaries combined.

[1] http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield

(Never mind the interest hike on the 1 month bonds - it is entirely caused by this manufactured crisis.)

On October 10 2013 14:03 aZealot wrote:


Pretty much. It is political shenanigans like this that spook the market. Yields have been at low levels for a long time now.