Debt and Deficit Will Take Us Down

Floor Speech

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Mr. SCHWEIKERT. Mr. Speaker, part of what we are going to do tonight is a little thick. Can you imagine that?

Mr. Speaker, I want to walk through a handful of things. Even as Mr. Roy was just touching on it, I need us to understand what is going on in our math.

Mr. Speaker, guess what. We had sort of a record today for not being in COVID or whatever disasters. Every day, I send out a text message. It is part of our Joint Economic Committee. I have a few thousand people who subscribe to this. Yes, it is a little geeky. What we are doing is we are capturing the numbers from the Treasury Department. We have built a whole system where we grab those and send those out.

Mr. Speaker, you will be happy to know, over the last 12 months--and this will make sense in a moment--if you divide our borrowing, just our borrowing, we are now borrowing $83,720 per second. That is $83,720 per second. Functionally, when we do the 12-month math, that is a new record. Yet, we have flattened out discretionary spending. The things my colleagues and I get to vote on, that is flat, but we only get to vote on about 25 percent of the spending.

This is why it is so hard to actually have this conversation here. The majority of our debt--I am going to show some of this, and then I am going to show where we have some of the waste and fraud. I have to get to the alignment. Then, I am going to get to something that I think is actually optimistic.

We have to understand that we have a shortage of children. We have functionally the same number of 18-year-olds today as we had 20 years ago and double the number of 65 and up. We have known this was going to happen for a very long time.

It is almost like, is it because we are fearful of getting reelected? The White House gets cranky when we talk about these things?

It is Republicans and Democrats. We come here and talk about shiny objects, but we have a math problem. In 33 months, over half the spending from the government here in Washington, D.C., will go to those 65 and up.

Somewhere here, my 3-year-old is actually running around here. Yes, I am insane. I have a 3-year-old and a 10-year-old. My wife is exactly my age.

We have some math. If you use a 6 percent generational discount rate, you need 104 percent of my 3-year-old's lifetime income just to pay Federal Government pensions. That is Social Security, Medicare, military, and Federal. It is partially because we have so few children and so many baby boomers. It is not Republican or Democrat. It is just math.

Mr. Speaker, we are going to do what? Once more, the two primary drivers of our borrowing today, that $83,000 per second, what are the two drivers? It is interest and healthcare costs.

Interest is a function of: We have $38.7 trillion of borrowing out there, and that has to go to the markets. The market is going to set a price.

When we hear the discussions about the Federal Reserve, that is the short-term portion. When we start getting over 5 years, 7 years, 10 years, or 30 years, that is a market. We look at U.S. sovereign debt. What do we want to pay?

Mr. Speaker, think about this at the moment. Greece can sell a 10- year bond cheaper than the United States today. Does that set off any alarm bells? Is that just annoying because the hallways are full of people who want nothing more than more money spent?

We get two types of folks that come lobby us and walk in our office. Don't always think they are lobbyists. There are often constituents from home who walk in and say, We want more money, or, We want you to control and regulate our competition.

Mr. Speaker, I am hoping somewhere here we can convince our brothers and sisters on the Republican side, the conservative side, that we believe in free markets. We believe creative destruction is a rebirth of an economy, and it should be happening constantly.

I know some of the populists don't like that. The fact of the matter is, if we don't get remarkable productivity improvements, I don't know how we get wage growth.

Remember, unless we can do something crazy in supplies--so, supply- side economics--we are not going to make prices go down. What we do is we make them more affordable by wage growth.

Wage growth happens by two things. The first is by inflation. Well, that is just treading water. It also happens by productivity. We do it better, faster, and cheaper through technology, through other systems, and through redesign. That is how we raise wages.

What happens in a world where the estimated share of outlays that we are going to spend in government--we have an obligation. Society made promises. When we turn 65, we get our Medicare. When we turn 62 to 70 or 72, we can actually take Social Security. We made promises. If a person works for the Federal Government or if a person works for the military, they have pensions.

Right now, my demographics, ``Estimated Share of Outlays by Group,'' what does this government spend on populations? If a person is under 18, right now we spend 7 percent. In 2036, it goes down to 6 percent. Here is the punch line right here. This is my 65-and-up population. In the next few years, over half of our Federal spending will be to those--look, I am only a year away now--65 and up.

Are we supposed to talk about this? Those are obligations. We owe them. Do my colleagues see this down here? In 2036, we are down to 12 percent of Federal spending. Mr. Speaker, 12 percent of Federal spending is defense, and 52 percent will be to pensions and healthcare. Do my colleagues see the scale?

Remember, today, Social Security is the biggest spend. It is $1.6 trillion. What is the number two? What is the number two spend in the Federal Government? It is not defense. It is interest. Then, it is Medicare. Then, it is Medicaid and ObamaCare subsidies, ACA subsidies. Number five is actually defense.

As Chip Roy was just saying, I have been coming behind this microphone for over a decade. I am wondering, where are people's intellect? Is it you need the satiation of being angry instead of thinking through the scale? What takes down a republic? I would argue debt and deficits and this financing are what will take us down. The bond market is now almost in the place where it will run this country.

Let's actually walk through a couple more of these and see if we can sort of make the argument so it makes sense. The second half of this chart is, in my personal opinion, garbage, but it is a projection. I want us just to look right here, from this point here, 2025 to 2036.

This is actually the population of 18-year-olds coming down because we can actually sort of calculate that right now. You have to understand--ignore this stuff. By 2036, we have only 4 million 18-year- olds.

The fact of the matter is: You tell me how I keep growth in an economy when I have shortages of young people entering the workforce, entering the economy?

I have done presentation after presentation. You are going to have to accept technology. You are going to have to accept synthetic biology. You are going to have to accept robots and labor substitution. If you want wages to go up in America and make things more affordable--one of the reasons President Trump has talked about this in many different ways at the White House and others, we had a population problem.

The math right now says that the United States is fairly close to zero population growth.

Do you remember your high school economics class where they taught you that GDP growth is a combination of step-ups in productivity and population growth. What happens when we don't have the population growth?

No, you are not magically going to create an army of new little babies. Bless them, but this is not just the United States. It is all over the industrialized world.

Oddly enough, the United States is still much better off than many, many countries. France actually has a higher fertility rate than the United States, even when you adjust for their immigrant population.

We have been trying to promote what we call a unified theory that says that the adoption of technology, the legalization of healthcare disruptions that will make us healthier, better; move to a truly talent-based immigration system; move away from the family sponsorship system, and President Trump has talked about this. Remember that he says that it is insane that we educate someone and send them home to compete with us.

There are about a dozen things on our unified theory, and you have to do them all at once. It is one of the reasons that I am not running again.

I had an agreement that we were going to do a second reconciliation. Part of that reconciliation, we were going to do all of these ideas that saved money but didn't take away services. We were going to get rid of the waste and fraud and the misalignment and the way some of the things are scammed, and that became too hard.

You do realize that $83,000 a second is $7.4 billion a day. If you want something that is uncomfortable--maybe I shouldn't talk about this, so that means I am going to--DOGE. I absolutely loved DOGE's mission, but once again, you have to be able to execute it. You need Members of Congress who are tough SOBs to execute it.

When we started DOGE, it was going to be $2 trillion. Excuse me. When the White House started DOGE, it was going to be $2 trillion. Then it fell to $1 trillion. You can go to doge.gov right now. It will be $200 billion-plus of identified savings.

What have we actually executed? What have we helped them actually execute? It was about $7 billion. We borrowed more than that just today. Does anyone see a math problem?

Let's take a look at this one. Contributions by outlays alone to the 2025, 1.75--I also need to--we all fuss about this in our office. Last year's sort of official borrowing was $1.750 trillion. Understand there was a one-time kickback of student loans. If not, it would have been closer to $2 trillion, but, hey, math is math.

I need you to think about this.

Mr. Speaker, 17 percent of our contributions to that debt came from interest and 16 percent were the increases in national defense, the one thing that is in the Constitution here. When you start to actually take a look at the biggest spend, 29 percent was our benefits to those who are age 65 and up. Then you actually get over here, 54 to 64, that is 10 percent.

When you get to our kids, those who are under 18, we spent about 8 percent. When I say ``spent,'' these were things that drove borrowing.

I am trying to create an understanding that, if we don't get our act together, we have really ugly things happening. In 6.5 years from now, the Social Security trust fund is empty. In 6.5 years from now, the Medicare trust fund is empty.

This is a 24 percent cut to your Social Security check, and this is an 11 percent cut to hospital reimbursement. That is 6.5 years from now, and the scale on it is monstrous. When I get idiots who will say to just raise taxes, I think the first year, which will be 2033, it would be, if you add them together, $638 billion. The scale of this is monstrous.

How often do you see us stepping up and saying that we are going to start working on this today because it is going to take us a couple of years to figure out how we are going to finance this? Are we just going to pretend? We double the poverty of seniors in 7 years. We have a math set that says that we will double the number of baby boomers who live on the street 7 years from now.

Does anyone have morality around here and want to just do the right thing?

The idiocy from some of my Democratic colleagues who will say that we will just raise the cap on this and that, if you actually do sort of the cap, the calculations, you get a nice spike for a little while, but it only covers about 38 percent of the shortfall.

This is not easy. Then many of us come up and say that we also have another math problem. Being on the Ways and Means Committee, we are supposed to actually manage the revenues into this Federal Government.

What happens when we have really good GDP growth but a lot of that isn't coming from labor but it is coming from capital expenditures?

Mr. Speaker, as you already know, we have an income tax-based tax system. We tax your capital gains. We tax your wages. We then have FICA taxes, which are your Social Security, your Medicare, your unemployment.

What happens when much of our economic growth is coming from capital expenditures and not the taxes on wages? We are actually sort of seeing we are forced to have a discussion of how do we finance the future of this government? Are we allowed to do that? It is reality.

So here is a question for anyone who is crazy enough to be watching. I always find this interesting. We will get some folks who, tomorrow, when this thing goes up on YouTube, who will fuss and say that the Chamber is empty. It is just the way it is at night, but we are on approximately a thousand televisions around the campus, and, hopefully, there is some poor intern who is stuck having to watch this.

Yet, we are probably on several hundred thousand, maybe a million television screens around the country if people are either freaky smart or have no life and are trying to find a way to fall asleep and are watching C-SPAN right now and some guy trying to do a semi-economics and debt and deficit lecture.

For those of you who do care, you start to walk through this math and say: How do you actually deal with the fact that these trust funds go empty in the next couple of years and our mix is changing and, yet, the groups that make their money trying to--all right.

Let's do the question: Is borrowing a tax? Mr. Speaker, it is a simple question. Is borrowing a tax? It is money we owe, and we have to pay interest on it. It is a tax paid for by a future generation, just as inflation is a tax on your savings. But we can hand out things--so last year, for every dollar we took in in tax receipts, we spent $1.43. Now, this year, it is better with what President Trump did, what we did here. We pushed down some of the spending. We made our first adjustments in Medicaid. Even then, the spending still goes up. It just goes up slower.

Our guess is that this year, for every dollar of taxation we collect, we are going to spend about $1.33 or $1.34. My math is closer to $1.36. But you can't do that very long.

Let's actually walk through some of the things we have been analyzing as the Joint Economic Committee. I also chair the Joint Economic Committee. I have come here and done detailed presentations from the MedPAC report and other things on something called Medicare part C. It is Medicare Advantage. It is now 55 percent of the population. I really want to defend Medicare Advantage. I just want it to be more efficient.

We have a math problem. There is something in there where we have identified--and this is also from the MedPAC reports. We call it excess premiums for Medicare Advantage. This last year, we think it came in at about $13-plus billion. What is funky about this is part of that exposure ends up on Medicare part B and Medicare Advantage, or traditional Medicare. This one is the traditional Medicare, and this one is the MA.

What that means is you are paying it. If you are on Medicare, particularly if you are on traditional Medicare, you are picking up a whole bunch of other costs. The Federal Government is picking up about 9.9 percent, and the States are having to pick up some of the burden also because of dual-eligible populations. Dual-eligible populations where you are poor enough that if you are on traditional Medicare, Medicaid picks up part of your copays.

But this is, once again, a mistake in the design of Medicare Advantage. We are transferring costs to other populations in Medicare.

The punch line here--we had a fight in my office whether I should walk everyone through the whole formula, and I think I would have had no one watching on C-SPAN because it is complicated. You need to understand that over a couple years, if you are on traditional Medicare, you are basically paying $2,589 more because of this misalignment here, where these costs are being shifted to the Medicare part B portion.

We have a way to fix this. We have offered a piece of legislation that basically takes Medicare Advantage and puts it back to its tradition where you don't try to make more money by the risk scores or the star ratings. You put it into the initial bid, and, yes, you are going to have to do longer enrollments and those things so the insurance company invests in making you healthier.

What we see is a healthier Medicare Advantage population uses less, and the companies can make a bigger profit. It is good for society. It is a good win-win, but now you have to make a decision--and I am speaking more to the Medicare Advantage lobbyists right now, if there is anyone out there watching--functioning zero is the proposal right now coming from the administration. Instead of redesigning the program and getting rid of-- let's just call it--I won't call it waste and fraud. We will call it the misalignment that has been identified in the MedPAC reports, whether they be 20 percent more than fee-for-service or a future one that may come down to 17 percent, but that is still, over 10 years, like $2 trillion of additional spending; or you can actually get crammed down here, which is what is coming; or work with offices like ours that want to take the program back to its original design where these insurers make money by helping their populations be healthier; or you can basically start to just get undercompensated over and over and over.

Once again, let's come back to the basics. If you go back to the MedPAC report, this is just the overpayment portion. This is not some of the other things that are in the MedPAC report that drive us insane. That was $84 billion last year. We will sit here on the floor and fight for hours over a fraction of a fraction of a fraction of that because this is hard to talk about. It is complex, and there is an army of lobbyists to stop us from doing it.

Maybe we should learn to do the complex things because, once again, we borrowed $7.4 billion today.

Let's do some happy talk. Last Saturday, in Scottsdale, we actually did a Joint Economic hearing, a field hearing. We brought in some incredibly creative companies in the healthcare space. We had one there that has actually come up with a type of multicancer detection. I am still having a little trouble on their technology. They think they can do it with a handful of drops of your blood that you could actually extract at home, and they put it on a plate, and they are looking for a type of peptide--it is not the ones you do when you are bodybuilding--a type of peptide that would help identify different types of cancer. They think they can get this product down to about $150. You would do a multicancer test multiple times a year.

We had the gentleman sitting over next to me over here, he is from Doctor AI. If anyone is watching and you are interested, go look. Utah has just done a sandbox with them, so the State of Utah where the AI is doing renewals of your prescriptions. Why aren't we all doing that? There are ideas here where you had a revolution to crash the cost of healthcare.

WHOOP was there, and they were talking about some of the things that are coming in the future where you can be basically wearing your medical lab on your body. It can talk to the Doctor AI, and then the healthcare provider there knows whether you need to come in or whether it can be prescribed to you just automatically.

Mr. Speaker, my point is if we could get our act together and start being creative and doing the hard things and stop making the technology disruptions, because they are functioning illegal today, you know, allowing AI to prescribe, allowing the wearables. Remember, the newest version of Apple Watch is an FDA-approved medical device for the heart, just a thought experiment within its scope of what has been approved by the FDA should be allowed to prescribe. Are we ready to start doing things like that?

If we don't start telling the truth about the math, the next few years are going to be hell around here. I won't be here for it, but you will. Is winning the next election that much more important than telling the truth? I am in a 50/50 District. I get up into entire meetings on how to save Social Security, how to save Medicare, how to save these things, and I have been rewarded over and over and over. I think I am one of the most expensive races and losses for the Democrats in all of America.

You can win. Treat your voters with respect. Treat them as having an intellect and treat them that it doesn't have to be a dystopian darkness if you are willing to innovate. But if you are not willing, it gets ugly.

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