Government Funding
Floor Speech
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Mr. PAUL. Mr. President, Republicans like to mock modern monetary theory--the idea that government can print money with impunity and that government can spend whatever it wants without the need to tax. Modern monetary theory is basically the Dick Cheney ``deficits don't matter'' crowd, trussed up with a new fancy title.
Most Republicans rightly lampoon this quackery; that is, when they are not practicing the quackery themselves. Today, many of these same Republicans will vote for a bill that makes modern monetary theory look like child's play in comparison. The monster spending bill presented today is not just a ``deficits don't matter'' disaster, it is everything Republicans say they don't believe in.
This bill is free money for everyone. Proponents don't care if you are fully employed or own your own house or own your own business. ``Free money for everyone,'' they cry. And yet, if free money were the answer and if money really grew on trees, why not give more free money? Why not give it out all the time? Why stop at $600 a person? Why not $1,000? Why not $2,000? Maybe these new free-money Republicans should join the ``everybody gets a guaranteed income'' caucus. Why not $20,000 a year for everybody? Why not $30,000? If we can print up money with impunity, why not do it?
The Treasury could just keep printing the money; that is, until someone points out that the Emperor has no clothes and that the dollar no longer has value. To so-called conservatives who are quick to identify the socialism of Democrats, if you vote for this spending monstrosity, you are no better. When you vote to pass out free money, you lose your soul, and you abandon forever any semblance of moral or fiscal integrity.
So the next time you see Republicans in high moral dudgeon, claiming and complaining about spending of Democrats and socialism, remind them--remind them if they supported this monstrous bill, that really the difference between the parties is less Adam Smith versus Marx and more Marx versus Engels.
How bad is our fiscal situation? Well, the Federal Government brought in $3.3 trillion last year and spent $6.6 trillion. The deficit last year, a record-busting $3.3 trillion. If you are looking for more COVID bailout money, we don't have any. The coffers are bare. We have no rainy day fund. We have no savings account. Congress has spent all the money long ago.
The economic damage from this pandemic is not the reason for this runaway spending. This spending has been going on for decades. Every year, even before we get to all the extra COVID-free money, we have been spending $1 trillion we don't have.
Today's money is gone, so Congress is spending tomorrow's money. The spending chart is a red line of red ink that goes on forever. When we talk about spending tomorrow's money, it is not just the money that we need next month. It is the money we might need in a decade. It is the money we will need in one, two, three generations from now--for national defense and for infrastructure. This is the money that your children and your grandchildren will pay back with interest.
The deficit doubling and tripling--under George Bush, it went from $5 trillion to $10 trillion. Under President Obama, it went from $10 trillion to $20 trillion. We are now at $27 trillion, but we are adding it at $1 trillion a year before we get to this COVID budget-busting bailout.
Every tax-paying American already owes over $136,000, and they are staring at projections into the future that show no end. We are $27 trillion in debt today. How do we expect a child to have the economic opportunity when this crushing debt is their inheritance from Congress? The numbers are mind-boggling. It is hard to conceive of what $1 billion is, much less $1 trillion.
How big is $1 billion? Well, a billion seconds ago was 1988 and Reagan was President. A billion minutes ago, Jesus walked the shore of the Sea of Galilee. A billion hours ago, man still lived in caves. But $1 billion ago, was just 80 minutes ago--$1 billion ago, at the rate Congress spends money, was just 80 minutes ago.
All of this should be setting off alarm bells. But the only alarm bells in Congress are sounding the alarm for more spending and more debt. No cuts, no offsets, no pay-fors, and no prioritization. Just print it up. Print up more money and give it out to everybody because it is free money. Come and get yours while the getting is good. But it leads to a mountain of debt. Spend all this money and leave the future to figure itself out.
John Maynard Keynes was once asked: What about the long run?
He said: In the short run, you can make a stimulus. You can print money, and you can give it to everybody.
And Maynard Keynes, his response was: In the long run, we will all be dead; no concern for the future, only for the immediate.
Our budget deficit for 2020 was $3.3 trillion, but this new spending package will also give us another $2 trillion in the next fiscal year. By refusing to acknowledge the debt crisis, we are only hastening the day of economic reckoning.
Total debt was 55 percent of GDP just 20 years ago. Today, it is 128 percent of GDP. So our annual or our total debt is more than our GDP-- 128 percent of our GDP. The World Bank estimates there is a tipping point of debt to GDP at about 77 percent. Every percentage point costs another 10th or so of economic growth. So every year, we are giving out somewhere between 5 to 8 percent of growth every year because of this burden of debt. This is thousands of jobs, every year-- tens of thousands of jobs that we lose because of this burden of debt.
We are borrowing and worsening this debt crisis in part because too many Governors and mayors have imposed heavyhanded restrictions that crush business. It isn't the pandemic that is killing the economy; it is the government's overzealous response that is killing the economy. The pandemic itself was disruptive, but Congress is being asked to help to perpetuate these lockdowns. The more money we give to the States, the more they keep us in lockdown.
Every bailout dollar printed and passed out to the Governors only allows these tin-pot dictators to perpetuate the lockdowns. Their rules are arbitrary and unscientific. Governors and mayors across the country are picking winners and losers.
Businesses, some that have been in families for generations, are being wiped out because they are not allowed to open. Restaurants have to close their doors for indoor dining, but then they are told they can open at limited capacity, but then they are told they have to close again. Then they are told they can open outside, and then they are told they can't open outside. Confusing doesn't even explain the half of it.
Bars are told they can only serve alcohol if people are sitting and not standing and only if they have heavy foods on their menus.
Restaurants are told they can serve outdoors, and then they have their permission revoked after they have sunk time and money converting their restaurant to outdoor services, but a caterer is told they can still serve outside.
Businesses are told they have to close at an arbitrary time determined by government officials, as though the virus only comes out late at night. A business in one ZIP Code can open, but one in an adjoining ZIP Code across the street has to close, as if the virus can't cross an imaginary line.
Airlines are allowed to fly, but hotels have to limit their occupancy, so you may not have anywhere to stay when you get there.
Mom-and-pop stores and specialty stores are forced to close, but big- box store competitors are allowed to stay open.
How is any business expected to survive with this kind of arbitrary regulation that changes from day to day? Meanwhile, many schools remain closed--despite overwhelming evidence showing kids can learn safely in person--which means parents can't go to work, which forces parents to leave their jobs and take care of homebound kids. Now they have no income because the government forced them to leave their jobs to take care of their kids. And many kids are struggling with this improvised virtual school.
The need for help is real. I hear it every day from Kentuckians and across the country. But it is clear that government has worsened the economic damage and acted as the biggest obstacle to economic recovery.
There is no free money that can get us out of this situation. The only thing that can save us is to open the economy. If we give these tin-pot dictators--these Governors--more money, they are less likely to open the economy.
The answer is not printing up and distributing ``free money''; it is opening the economy. We are not even debating the real answer to this. We are like, just print up the money and shovel it out the door, the deficit be damned, the threat of the destruction of our currency be damned.
We can choose to let our economies open with guidance and precautions but not obstruction. Let people rebuild their livelihoods. Reopen our schools so our kids can return and parents can go back to work.
Congress should do away with automatic spending increases and scrutinize where in the budget we can find savings to pay for the pressing needs arising from the pandemic, but we shouldn't simply print up money and pass it out to everyone. Or Congress can follow the status quo. Congress can continue to borrow from our kids--the same children we have locked out of our schools. Congress can keep enabling and shutting down businesses by force, spend all of today's money and all of tomorrow's money, and then good luck. Good luck figuring out how to pay for all of this massive debt.
It doesn't have to be this way. There is another alternative that won't be debated, and that alternative is to open the economy. It is not too late to change our course. Cut unnecessary spending. Eliminate waste. Stop fighting a $50-billion-a-year war in Afghanistan that hasn't had a military mission in at least a decade.
Make the hard decisions now. We can't keep pretending that more debt is a sustainable policy course. ``Leadership'' is not passing on the problem to someone who can't protest; ``leadership'' is making the hard choices now. This is what we have to do.
I will oppose this new debt, and I will continue to sound the alarm until we change our course. Our country can be saved. We can survive this if we pull together. But adding more debt is a mistake. It is not the solution, and we should resist it.
Thank you.
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