Date: 2011-07-25
Speaker: JACKSON LEE (democrat)
Chamber: H
State: Texas

To add to what my colleague just said. we are also in a climate of fighting against terrorism. and in order to secure the homeland. you have to make choices about how you invest. so I have a different opinion. I think. if you invest money. you get innovation and you get jobs. and none of what has been said by Speaker BOEHNER says anything about innovation. jobs. and he has no. seemingly. understanding of the importance of securing the homeland. Mr. Speaker. I am joined this evening by Members of the Congressional Black Caucus to call upon Congress to pass a bill that increases the debt ceiling so that we can avoid economic disaster and continue to work for the American people in repairing our economy and creating jobs. While I support bipartisan efforts to increase the debt limit and to resolve our differences over budgetary revenue and spending issues. I cannot support any measure that unduly constrains the ability of Congress to deal effectively with Americas economic. fiscal. and job creation troubles. Since the debt limit was first put in place. Congress has increased it over 100 times. in fact. it was raised 10 times within the past decade. Congress last came together and raised the debt ceiling in February 2010. Today. the debt ceiling currently stands at $14.3 trillion. In reality. that limit has already been eclipsed. but due to accounting procedures by Treasury Secretary Geithner. the debt limit can be avoided until August 2nd. Congress must act now in order to avert a crisis. Never in the history of America has the United States defaulted on its debt obligations. We must be clear on what this issue means for our country. United States Treasury bonds have traditionally been one of the safest investments another country or investor could make. For foreign nations and investors. purchasing a U.S. Treasury bond meant that they held something virtually as safe as cash. backed by the full faith and credit of the United States government. As we continue to discuss the necessity of increasing out debt ceiling. I have heard the concerns of many of my constituents and the American people regarding the size of our national debt and the care with which taxpayer money is spent. I. too. am concerned about these issues. for to burden future generations of Americans with tremendous amounts of debt should not be a way to avoid our fiscal responsibilities to the American people. However. the task of resolving our debt ceiling crisis must take precedence over other concerns. including political ideology. Prior to the existence of the debt ceiling. Congress had to approve borrowing each time the federal government wished to borrow money in order to carry out its functions. With the onset of World War I. more flexibility was needed to expand the governments capability to borrow money expeditiously in order to meet the rapidly changing requirements of funding a major war in the modern era. To address this need. the first debt ceiling was established in 1917. allowing the federal government to borrow money to meet its obligations without prior Congressional approval. so long as in the aggregate. the amount borrowed did not eclipse a specified limit. In turn. with the proceeds from the bonds. the federal government of the worlds largest economy is able to finance its operations. If the United States defaults on its debt obligations. the financial crisis that began in 2008 would pale in comparison. according to economic experts. The ensuing economic catastrophe would not only place the U.S. economy in a tailspin. but the world economy as well. The fact that Congress. a body that typically has its fair share of political battles. has never played political chicken when it came to raising the debt ceiling should give us all pause. and is a testament to the seriousness with which we must approach this issue. However. this time around. some of my Republican colleagues have created an impasse based upon an ideological commitment to spending cuts. While I understand and share the concern of my Republican colleagues with respect to deficit spending. and will continue to work with them in order to find reductions. now is not the time to put ideology over pragmatism. The reality is that. on August 3rd. the United States will begin to default on its debt obligations if the debt ceiling is not raised. This detour into a spending debate is as unnecessary as it is perilous. as increasing the debt ceiling does not obligate the undertaking of any new spending by the federal government. Rather. raising the debt limit simply allows the government to pay existing legal obligations promised to debt holders that were already agreed to by Presidents and Congresses. both past and present. Raising the debt limit simply matches the amount the United States is allowed to borrow to the amount it already owes. Moreover. the impending crisis would have already occurred were it not for the extraordinary measures taken by Treasury Secretary Timothy Geithner. including the suspension of the investment in securities to finance the Civil Service Retirement and Disability Fund. as well as the redemption of a portion of those securities already held by that fund. If the United States defaults on its obligations on August 3rd. the stock market will react violently to the news that for the first time in history. America is unable to keep its promises to pay. Not once in American history has the countrys full faith and credit been called into question. Credit rating agencies like Moodys and Standard & Poors stand ready to downgrade the triple A rating that America currently enjoys. Once America defaults. investors who purchase U.S. bonds and finance our government will be less likely to lend to America in the future. Just as a person who defaults on a loan will find it harder to convince banks to lend them money in the future. a country that defaults on its debt obligations will find it harder to convince investors to lend money to a government that did not pay them back. Showing the world that the United States does not pay its debts makes the purchasing of that debt less desirable because it requires the assumption of more risk on the part of the investors. Furthermore. any investors who continue to purchase U.S. Treasury bonds will demand much higher interest rates in order to cover the increased risk. Once a default occurs. investors figure that the chance of the United States defaulting again is much greater. and will require the government to pay higher rates of interest in order to make the loan worth the risk for investors to take on. Imagine the impact on our stock market if we do not pay our debts. As we have seen throughout the recent financial crisis. a bad stock market hurts not only big businesses and large investors on Wall Street. but small businesses and small investors as well. Families with investments tied to the stock market. such as 401(k)s. pension plans. and savings. will once again see the value of their investments drop. The American people are tired of the uncertainty of the value of their retirement accounts. With uncertainty still lingering in the markets and in the minds of citizens. we must not allow another wild fluctuation in the markets to occur due to default. One of the major reasons that the job market continues to remain so stagnant is the fact that the flow of credit to small businesses that enables them to hire and expand has slowed. Increasing the debt ceiling is the responsible thing to do. Congress has already debated and approved the debt that an increased ceiling makes room for. However. my Republican colleagues have chosen to use this as an opportunity to hold the American people hostage to their extreme agenda. They knew that the "Cut. Cap. and Balance Act" was not a realistic proposal and that it was not going to pass the Senate. They just wanted to waste time. Mr. Speaker. along with the Congressional Black Caucus. I believe that Congress should increase the debt ceiling to meet the obligations the United States has already promised to undertake. By refusing to do so. it endangers our economy and the recovery of our jobs. Last week Republicans introduced the "Cut. Cap and Balance Act" which I aptly named the "Tap Dance. Loser Club. and Bust Bill." Because it tap danced around raising our debt ceiling and acting in a responsible manner to pay our nations debt obligations. That bill would have forced our nation to join a losers club as it would have eliminated important social programs such as Medicaid. Medicare. Social Security. and Pell grants. The theme for the Republicans seems to be a focus on cutting programs for the most at need and ignoring the need to focus on Job creation. This bill busts the hopes and dreams of our children. seniors. and military families. It busts the hopes to grow our nation in the future. The "Tap Dance. Loser Club. and Bust Bill" was just a distraction and now we have the opportunity to once again get serious about raising our debt. We can not continue to waste a tremendous amount of time. The Deadline is right around the corner. The American people cannot have a government that is the embodiment of living check to check. We must do something NOW! For a moment think about the American people. Step back and envision the faces of those who will be impacted if we are not successful in finding common ground. They are the faces of the the elderly who will not receive their social security payments. They are the faces of children and infants who will not receive their WIC benefits. They are the faces of hardworking every day Americans. including the multitudes of poor working families who will not be able to receive the benefits they need from government run programs that are keeping them from falling into homelessness. When you think of our future. also see our present. Without raising this debt limit we are putting the present and the future of Americans at risk.