Hatch Urges Admin. to Work with Congress as Debt Limit Approaches, Warns of Effect on Utah
Washington, D.C.—As the United States approaches the deadline for the statutory debt limit, Senator Orrin Hatch, R-Utah, took to the Senate Floor to urge the administration to work with Congress to find a responsible path forward to ensure the nation does not default. Hatch also discussed what the national debt means for the United States, and particularly for Utah.
“As we contemplate another debt limit increase, President Obama doesn’t see the need to even talk to Congress about our fiscal future,” Hatch said. “In fact, the administration won’t even take a clear position on how much of an increase it believes is appropriate or how long it should last.”
Hatch has repeatedly called on the Obama Administration to improve its communication and increase its transparency of debt management policies.
“Let’s be clear: Neither the administration’s uncompromising stance on fiscal reforms nor its selective use of information about our nation’s debt are productive,”Hatch added. “The President’s refusal to work with Congress on a path forward and to share information about our nation’s finances is irresponsible brinksmanship.”
At more than $18 trillion, the national debt today stands at a historic high. It breaks down to $57,000 of debt for every U.S. citizen – every man, woman and child from age one to 101. For the people in Hatch’s home state of Utah that means $167 billion of debt.
“One thing that’s different is that our national debt is higher than it has ever been before – more than $18 trillion, an astronomical number,” Hatch said. “That is $57,000 of debt for every U.S. citizen – every man, woman and child from age one to 101. For the just the people in my state of Utah, which has a relatively small population, that means $167 billion of debt.”
The Full text, as prepared for delivery:
Mr. President, as we are apparently approaching another deadline with regard to the statutory debt limit, I’m reminded of the old paradoxical proverb: “The more things change, the more they stay the same.”
We have, of course, dealt with the debt limit here in Congress on numerous occasions. And, while there are significant differences this time around, there are some things that, particularly when we’re dealing with the Obama Administration, just don’t change.
One thing that’s different is that our national debt is higher than it has ever been before – more than $18 trillion, an astronomical number. That is $57,000 of debt for every U.S. citizen – every man, woman and child from age one to 101. Just for the people in my state of Utah, which has a relatively small population, that means $167 billion of debt.
And, as a share of our GDP, the debt is higher now than at almost any time, with the exception of a brief period surrounding World War II.
Yet, even though our debt has gotten further and further out of hand under this President, the administration’s approach has not changed.
As we all know, Treasury Secretary Lew recently sent a series of letters urging Congress to raise the debt limit. In his latest communication, he projected that, on November 3, the Treasury will begin to run dangerously low on cash, creating an unacceptably high risk of having to delay payments. Of course, we don’t have an ability to verify that projection, and Treasury has long been uncooperative in Congress’s efforts to get more information as to how they arrive at these specific dates.
Don’t get me wrong, I take the November 3rd date seriously. I think we all should.
But, given the lack of hard data shared by Treasury regarding these projections and the fact that the date has, in just the last few weeks, moved around a little, I do understand why some people appear to believe that this latest best guess from Treasury is fungible.
In addition to providing the November 3rd deadline, the latest debt limit letter from Secretary Lew includes what has become a stale set of talking points punctuated by the admonition that “only Congress can extend the nation’s borrowing authority.”
Now, I know no one wants to hear a civics lesson. But, given the administration’s repeated attempts to assign all responsibility relating to the debt limit to Congress, it appears that a short refresher about how a bill becomes law might be helpful.
No one disputes that Congress must act to extend the government’s borrowing authority. But, the President can also sign or veto any debt-limit legislation we pass. The same is true of any legislation authorizing or appropriating spending increases or reductions – Congress writes and passes legislation, the President signs legislation into law and, hopefully, does his best to enforce it.
In other words, Mr. President, both Congress and the executive branch share responsibility with regard to the debt limit and our nation’s overall fiscal health. Unfortunately, rather than trying to work with Congress on these issues, the Obama Administration has repeatedly chosen to try to deflect responsibility with misleading statements about the various burdens born by the separate branches of government.
Sadly, the Treasury Secretary’s tired arguments with regard to the debt limit aren’t the only problem. In fact, when you examine this administration’s record, you’ll find that the problems are much, much worse than most want to admit. I’m talking, of course, about the massive accumulation of debt we’ve seen under this administration, as well as the lack of leadership and willingness to work with Congress to address what we know are the main drivers of our debt.
As the nonpartisan Congressional Budget Office has repeatedly made clear, the main drivers of our debt are our unsustainable promises in the Social Security benefit programs and unsustainable spending on the federal government’s major health care programs – Medicare, Medicaid, health insurance subsidies under the Affordable Care Act, and others.
True enough, we’ve seen some deficit reduction in recent years. These days, the President and his allies are always quick to point that out.
Of course, we know that these temporarily reduced deficits have resulted predominantly from increased tax receipts and only modest spending restraint. Still, even with these reduced deficits, our debt remains well above the historic average and is expected to grow even more in the near future as, according to CBO, our deficits will start to go back up in the next few years.
Simply put, no one in this administration should be bragging about supposed fiscal responsibility.
Under this administration, the outstanding public debt has risen by more than an astounding $7.5 trillion, a 71 percent increase. And, once again, as a share of the economy, our current debt remains at levels that, with a very narrow and understandable exception, are heretofore unseen in modern U.S. history.
According to CBO, by 2025, federal debt held by the public will be roughly twice the average of the past five decades. And as CBO says: “Such high and rising debt would have serious negative consequences both for the economy and for the federal budget.” Given this risky path of debt accumulation, CBO also warns of increasing risks of a federal fiscal crisis.
Unfortunately, those dire warnings have been ignored by the administration. Instead, the administration seems to believe that a temporary lull in deficits is a good time to accelerate spending – even though spending grew well above growth in the economy last fiscal year – all while they continue to ignore the growing crisis in our entitlement programs.
When he was serving in the Senate and a different party controlled the White House, President Obama famously argued that an increase in the debt limit was a sign of leadership failure. Now, his definition of leadership is to assign all responsibility to Congress for the debt limit.
And, when he was running, as then Presidental Candidate Obama, he pledged not to kick the can down the road on reforming entitlements, particularly Social Security. Now, he shirks responsibility and his proposed solution to the most immediate problem with Sociality Security – the Disability Insurance Trust Fund – is to kick the can much, much further down the road without any changes or reforms to the program.
Mr. President, I believe that the debt limit has and can play a role in promoting fiscal discipline.
Historically, debates over the debt limit have provided opportunities to reexamine our fiscal outlook and, when necessary, make corrections. And, debt limit votes give a voice to members of Congress who do not serve on committees that make the spending and tax decisions.
Unfortunately, as we contemplate another debt limit increase, President Obama doesn’t see the need to even talk to Congress about our fiscal future. In fact, the administration won’t even take a clear position on how much of an increase it believes is appropriate or how long it should last.
Common sense would indicate that the President would like Congress to extend the debt limit past next year’s election. That would be a debt limit hike of around $1 trillion.
One trillion dollars would mean more than $3,000 per person in the U.S. just to get us through next year. Utah’s share of that would be about $9 billion.
Yet, while the President undoubtedly wants at least that much of an increase, he refuses to make any such desire known. Instead, we’ve gotten vague demands that borrowing authority be extended by certain dates and threats to veto any such extension that comes with even modest spending reforms.
Essentially, President’s Obama’s position is: It’s my way or the highway. But, oddly enough, he doesn’t want to explicitly define what his way is and he repeatedly argues that he plays absolutely no role and bears no responsibility in getting us there.
Make no mistake, Mr. President, I don’t want to see a default.
Default on U.S. Treasury securities and failure to pay federal obligations – which, by the way, are two separate things – is not a desirable or acceptable outcome. Ultimately, I don’t believe Congress should shirk its responsibilities even if President Obama refuses to acknowledge his.
But let’s be clear: Neither the administration’s uncompromising stance on fiscal reforms nor its selective use of information about our nation’s debt are productive. The President’s refusal to work with Congress on a path forward and to share information about our nation’s finances is irresponsible brinksmanship.
I want to talk about that information-sharing for a few minutes, Mr. President, because it is an important part of this continual impasse between Congress and the administration when it comes to the debt limit.
When we talk about our nation’s debt, there are other policy matters at play besides the periodic actions taken to raise the debt limit. The administration is charged with managing the debt in a responsible and effective manner, and toward that end, it has an obligation to preserve the integrity of Treasury securities markets.
Congress has a duty to exercise oversight of these activities. And, as chairman of the Senate committee with jurisdiction over these issues, I have to say that, when it comes to accountability and transparency on these matters, a great deal of improvement is necessary.
And, that’s putting it kindly.
For example, each time the debt begins to approach the statutory limit, the administration makes a lot of noise about how it is difficult to deal with delayed payments on Treasury securities. Please note that I am talking about payments on securities, not general payment obligations of the federal government for spending programs, which is a separate matter.
Now, a number of scenarios could give rise to delayed payments on Treasury securities. One of those scenarios is a debt limit impasse between Congress and the administration. But, there are others, including weather events, cyber or terrorist attacks, or any number of known risks that responsible debt managers must take into account.
We know for a fact that the Treasury Department and the Federal Reserve have developed contingency plans for these types of risks. The existence of such plans has been made public in minutes of the Federal Reserve’s Federal Open Market Committee, and in minutes of meetings involving Fed and Treasury officials and representatives of large financial firms.
However, the administration has flat-out refused to share those contingency plans with Congress or to even openly acknowledge their existence.
I have been the lead Republican on the Senate Finance Committee since January 2011. And, I h
