Debt Ceiling
Floor Speech
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Mr. DURBIN. Mr. President, it took 15 votes for Kevin McCarthy to become Speaker of the House of Representatives. It may not have been historic, but it was a sight to behold. To finally become Speaker, Kevin McCarthy made all kinds of commitments to the MAGA extremists in his Republican Party.
One of the promises he made to the hard-right holdouts in order to become Speaker was that House Republicans would use their razor-thin majority in the House to try to freeze Federal spending in fiscal year 2024 to fiscal year 2022 levels. Let me bring that down in plain English. This means cutting $130 billion out of the Federal budget that Congress just passed last month--$130 billion is nothing to sneeze at.
Now, how are they going to do it? What is on the Republican agenda in terms of cuts? Speaker McCarthy won't say and neither will the House Republicans. What they have said is they plan to use the debt ceiling as leverage to try to get their way.
What is the debt ceiling?
Let me give you an example. Last night, you went to a restaurant with your family. You had a wonderful meal, and you paid for it with your credit card. In a couple weeks you are going to get a bill from your credit card company saying now it is time to pay for that wonderful meal. That is our debt ceiling.
If we don't pay those bills on a timely basis, it raises the question as to whether we are credible or reliable, and those people who loan us money, if they worry about whether the United States is going to pay its debts, they are going to demand higher interest rates to protect their purchase of U.S. securities. That is the bottom line.
We have never--underline ``never''--defaulted on our national debt and debt ceiling in our history. As a consequence, the United States enjoys a solid reputation for financial stability. Well, Speaker McCarthy has decided to put that on the chopping block.
Let's get right up to the eleventh hour and see if we are going to extend the debt ceiling. It is within his power to stop it, and that is his threat. What we have said to him is: If you have something, a plan for cutting spending or raising taxes, which is unlikely--if you have a plan for cutting spending, be honest with us and tell us what it is.
Some of the proposals are incredible. There is an actual proposal to create a Federal--that is national--sales tax of--listen--30 percent. A 30-percent sales tax. So if that loaf of bread cost five bucks at the grocery store--and in Springfield, some of them do--instead of paying $5, you will pay $6.50. Did you think prices were already going up for food in the grocery store? Tack on 30 percent and see how it feels.
And the problem with this is not just the notion of a national sales tax of 30 percent; the problem is, who will pay it. Do you think the richest people in the world give a toot about grocery bills? They don't. But folks who are struggling paycheck to paycheck, trying to feed hungry kids, do. They can tell you week to week what is going on in the grocery store, and it is not very encouraging.
So one of the Republican plans for reducing Federal spending is creating a national sales tax of 30 percent. I am not making this up. This is one of the proposals which Speaker McCarthy has agreed to call as part of his response to the debt of the United States. MAGA Republicans are threatening to use the credit worthiness of the United States as a bargaining chip in a political debate here on Capitol Hill. And, I am sorry to say, if they go the direction we expect they will, it will go beyond a national sales tax.
They are talking about cuts in some of the most important entitlement programs in our budget. What are those programs? Social Security, Medicare, Medicaid, veterans' benefits. The list goes on. And it gets down into the heart of this economy. It gets down to whether or not the vast majority of retirees in the United States of America will have enough money to get by. Food bills are going up, the gasoline bills have gone up in the past, and this idea that we are going to cut Social Security benefits--the Republicans are on the wrong track.
Refusing to pay America's bills for the first time actually won't cut the national debt. It will end up in increasing interest rates and will increase the debt by $80 to $150 billion, and that is just a start. Millions of Americans can lose their jobs, and it can push us into a recession if we default on the debt. Workers with 401(k) plans will see huge losses in their retirement savings, and a new 30-year mortgage on a home will cost an additional $130,000, on average. Are people going to buy homes? Not likely. But people who own homes will see the values of those homes diminished, all because of this reckless strategy of confrontation by Speaker McCarthy.
One-quarter of our entire national debt--that is $8 trillion worth of debt--was accumulated during the administration of Donald Trump. One- fourth of the entire debt of the United States in its 230 years of existence--one-fourth of it--was accumulated in those 4 years. Of course, there was money spent on the COVID crisis. I understand that. But there was also a $2 trillion tax cut under President Donald Trump. Who got the tax cut? Most of it went to the wealthiest people in America and the biggest corporations. It is the tried and true Republican approach--cut taxes on the rich and hope for the best.
The last time the United States had a balanced Federal budget, incidentally--was it under a Republican President? No, it was a Democrat, Bill Clinton. The fiscal year 2001 Federal budget had a $128 billion surplus. Remember what Republicans' fear about the deficit was back then? They told us. The Republicans claimed that paying down the national debt too quickly would hurt the economy. They were critical of us in either direction--either too much debt or not enough.
So instead of using the fiscal year 2001 surplus as a downpayment on the national debt, Republicans--you guessed it--passed a huge tax cut in those days overwhelmingly benefiting rich people and powerful corporations. They said, and they always say this: Those tax cuts will pay for themselves--the same bogus claims they make about all their big tax cuts for the wealthy. Instead, 7 years later, the last budget George W. Bush sent to Congress contained a $1.4 trillion deficit.
The same thing happened when Ronald Reagan was President. Republicans passed huge tax cuts for the wealthy and promised that they would pay for themselves. If we could just get the rich a little richer, then working families would be better off. Instead, they produced the biggest budget deficit that America had ever seen.
So do they have a credibility gap on that side of the aisle when it comes to deficits? They sure do.
Rich Lowry, the editor-in-chief of the National Review, once the ``Bible'' of American conservatives, commented on what the MAGA strategy means. In an op-ed last week, he wrote:
It's very strange not to seriously pursue a deeply held goal when you have unified control of Washington, then to insist on trying to achieve much of it in one fell swoop when you barely have control of one chamber in Congress.
But here we are. This is the Republican pattern.
In the last fiscal year, under President Biden and a Democratic majority, we actually reduced the deficit by $1.4 trillion, the largest 1-year drop in American history under President Biden.
Democrats passed the Inflation Reduction Act to reduce the cost of healthcare, prescription drugs, and energy for American families, and to strengthen our Nation's energy independence with safe, new energy solutions.
The Inflation Reduction Act also cuts the deficit by more than $300 billion. We are not ignoring the problem. We are trying to address it seriously--the smart way to reduce the deficit: cut where you can, invest where you must, and make sure it is fair for middle-class and lower income families, not a boondoggle for the superrich in America.
President Biden kept his promise to not raise taxes on anyone making under $400,000. Democrats added a 15-percent minimum tax for wealthy corporations. It just was hard to take that these wealthy corporations and profitable corporations were paying nothing on taxes--that is right, nothing--leaving the middle class to pick up the tab in America.
Compare that to the new MAGA majority in the House. During their first week on the job, House Republicans proposed to increase the budget deficit by $100 billion by making it easier for wealthy individuals and big corporations to cheat on their taxes.
Think about this: The Center on Budget and Policy Priorities says that the IRS has 2,284 fewer skilled auditors to handle the sophisticated returns of wealthy taxpayers than it did in 1954. Seventy years ago, we had fewer auditors.
I believe the vast majority of Americans does their level best to file an honest tax return and pay their fair share of taxes. It boils my blood and theirs, too, to think that the tax cheaters are getting off the hook because the cops are not on the beat.
Historically, Republicans have taken away those auditors; have taken away the checks of the big, wealthy individuals and corporations. And they, of course, are tempted to cheat. Why let that happen when the vast majority of American families is doing the right thing? House Republicans just voted for a bill that will add $100 billion to the deficit to take away these auditors. That is not the way to balance a budget, and it is not fair to American taxpayers.
If that is not enough, as part of the deal, Speaker McCarthy also promised MAGA hard-liners that the House would vote on that jumbo-sized national sales tax, which I spoke about. As Grover Norquist, who is quite a conservative and quite a man on the issue of taxes, said: It is a political gift to Biden and the Democrats to consider a national sales tax. Well, we say: If this is a gift, no thanks.
In the last 2 years, America's economy broke records and created 11 million jobs--the strongest job creation in the history of this Nation. The Nation's unemployment rate is near a 50-year low. Gas prices are finally coming down. Inflation is just starting to ease, and the deficit is going down. We need to keep the country and economy moving in the right direction, not devastate Social Security and Medicare and certainly not impose a national 30-percent sales tax.
Speaker McCarthy is meeting with President Biden tomorrow for the first time since he became Speaker. He needs to show up not just with platitudes but with a plan, in writing, as to what the Republicans want to put on the table.
What is the Republican plan? Are they going to cut Social Security and Medicare? Mr. McCarthy said ``no, no way,'' on a Sunday talk show this weekend, but the math doesn't add up for his fiscal goals unless he goes after the entitlement programs.
If you are going to do that, Speaker McCarthy, be honest with the American people. Are the Republicans planning to slash money for education? healthcare? veterans? transportation? clean water? In the first two decades of this century, thanks in large part to the National Institutes of Health, cancer deaths went down by almost one-third in the United States--saving an estimated 3.5 million lives. Are we going to cut medical research, Mr. Speaker?
Speaker McCarthy and MAGA Republicans need to level with the American people.
Speaker McCarthy, my ask is very simple: Put your plan on the table.
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