Shared Sacrifice in Resolving the Budget Deficit

Floor Speech

BREAK IN TRANSCRIPT

Ms. KLOBUCHAR. Mr. President, I rise today to speak about the daunting fiscal challenges our country faces and the urgent need for comprehensive bipartisan action to address our Nation's debt.

As we debate the path to securing our country's fiscal future, Greece is battling to keep from defaulting on its bonds. It is in the news. There are legitimate concerns that a default in Greece would send shock waves through the world financial markets, with an impact potentially as devastating as the 2008 collapse of Lehman Brothers.

To avert bankruptcy, Greece has enacted austerity measures so drastic that violent rioting has broken out in its streets. Despite these measures, and despite the aid of other European countries, many economists believe Greece will eventually succumb to its rising debt burden and default. Standard & Poors warned Monday that even with the planned bailout by European banks, Greece's credit rating could be still downgraded to ``selective default.'' While better than a full-blown default, this will almost certainly roil the markets and cut off Greece's access to credit.

Alarmingly, Standard & Poor's gave a similar warning to the United States last week. In a statement to Reuters, Standard & Poors said it would drop the United States triple A rating to ``selective default'' if the Treasury Department misses its repayment on $30 billion in maturing bills on August 4.

Although our long-term fiscal challenges are serious, they are not what caused Standard & Poor's to issue this warning at this very moment. Instead, what caused the warning was a growing concern that the Congress would fail to come together to pass a bipartisan deal on the debt ceiling--something Congress has done without incident almost 100 times since the limit was established.

We must get serious about tackling the deficit and putting our country back on sound fiscal ground. But the problem we are facing now is not only a crisis of the dollars and the cents, it is also a crisis of the divide and the deadlock.

We know what we need to do in order to avoid default and bring down the deficit. We have all the tools and information necessary to do it and avoid a situation such as we are seeing in Greece. Yet instead of working together to craft a fair and responsible path forward, some have chosen to draw lines in the sand and take the debt limit--and our Nation's economy--hostage.

Addressing our country's fiscal challenges is something I have taken seriously. Since coming to the Senate, I have worked to reform the way Congress conducts its own business--reducing the budget of Congress, fighting for appropriations project reform, and working to restore the pay-as-you-go rule. I was one of a handful of Senators who fought for the creation of the fiscal commission, and I have supported efforts from both Republicans and Democrats to responsibly reduce the deficit.

While I believe we have reached a defining moment as a country which should not be wasted, I also know we can't afford to play Russian roulette with our economy.

What our country needs is for Congress to come together and build consensus around a comprehensive long-term deficit reduction package that will put us on the track to prosperity.

Ever since the economic downturn, families across the country have huddled around the kitchen table, making tough choices about what they hold most dear and what they can learn to live without. They expect and deserve their leaders to do the same. The American people are counting on us to put politics aside, pull together, not pull apart, and agree on a plan to live within our means and make America strong for the long haul.

If we are going to succeed in this challenge, we will ultimately have to accept things that we don't necessarily agree with. It is the only way to develop a plan that is both balanced and comprehensive.

We already know much of what will need to be done. Our failure to act has not been because we lack solutions, but because too often Congress has lacked the political will to get behind a consensus proposal. After months of debate, it is clear what sort of plan is needed to garner the support necessary to get us across the finish line.

First, a solution should match the scale of the problem. I want to see one that produces around $4 trillion in deficit reduction over the next decade.

Second, it should include a mix of revenue with realistic spending cuts. One example we are seeing right now is biofuels. The biofuels industry has been willing to put a big chunk of change on the table, right in the middle of the year, as we are working with Senators THUNE and FEINSTEIN on an agreement in which it would be a template, where one industry says, OK, we understand that we have a big problem, and we are willing to put money upfront for the

debt. We are willing to look at what we need to do in the long term to have a secure energy policy, but also help with the debt and end this subsidy. We want to see oil do the same thing. We want to see a lot of these loopholes closed, a lot of these subsidies end, and do it in a smart way. The budget Senator Conrad has been working on with the Budget Committee is an example of a mix of those revenues and spending cuts. That is what we have to look at.

Third, we must be able to achieve bipartisan support with a proposal, which is why I continue to support the work that has been done by the Gang of 6.

It is time we get serious about advancing a plan that is both fair and achievable. On August 2, the borrowing authority of the United States will be exhausted. No one benefits if we are unable to reach an agreement by this deadline. Every day that passes without a deal only increases uncertainty in the markets and puts the brakes on economic activity. Failure to bring the national debt under control threatens America's future, but the danger of default threatens our economy today.

The way I see it, we have two options. We can either set a precedent of holding our debt hostage to political maneuvering, raising the cost of borrowing and increasing the deficit, or we can show the world that we are serious about addressing our fiscal challenges, reducing the cost of borrowing and strengthening our financial outlook. I believe the choice is clear.

The sooner we can agree on a long-term package, the better for our economy and our country. I hope we can put partisan differences aside to work on an agenda that strengthens our economy, promotes fiscal responsibility, and increases global competitiveness, because if we refuse to have an honest conversation about this, if we insist on using the debate as a vehicle for rhetoric only, we will not just be doing ourselves a disservice, we will be cheating our children and grandchildren out of knowing the America we grew up in. The deficit isn't going to fix itself. We all know that. We all know we can't close our eyes, click our heels, and wish the debt would go away.

In their report, the National Commission on Fiscal Responsibility wrote that ``every modest sacrifice we refuse to make today only forces far greater sacrifices of hope and opportunity upon the next generation.'' They are right. The longer we wait, the more wrenching the choices become. Look at Greece. Who will be making those painful choices? Our children and our children's children.

None of us wants to see interest rates soar by playing Russian roulette with our economy. Democrats don't want it, Republicans don't want it. So what are we waiting for? It is time for Congress to step forward and show some leadership. It is time for us to work together to show the American people that Washington isn't broken, and that instead we are willing to put aside politics to do what we were elected to do--to do what is right for America.

This is our challenge, and it will be a hard challenge to meet. But I am confident we can come together to make these tough choices, to do what is right for our economy, and to renew the American promise of progress and opportunity for generations to come.

I yield the floor.

BREAK IN TRANSCRIPT

Source