BUDGET NEGOTIATIONS

Floor Speech

Mr. BENNET. Mr. President, I wanted to talk a little bit about our debt ceiling and our deficit and debt issues as well.

I wish to thank the Senator from Texas for her words of encouragement for the product that the so-called Gang of 6 read out this morning. It was a remarkable hour. To see roughly 50 Senators, both Republicans and Democrats, set aside the talking points and try to come across a partisan divide to hear their colleagues who have been working for such a long time on a plan, a bipartisan plan, three Democrats and three Republicans, to really try to address in a material way our debt and our deficit was, to say the least, refreshing. I wish it weren't as unique an experience as it has been, but in the 2 1/2 years I have been here, I can't remember as thoughtful a conversation as the one we had this morning.

I have said for months, month after month, week after week on the floor of the Senate, that I think I am pretty clear about what Colorado wants, whether it is red parts of the State or whether it is blue parts of the State.

They want a plan that materially addresses the problem we face. They know we can't solve it overnight because the hole is so deep, but they want us to move past the rhetoric and the talking points and actually start materially addressing the problem.

They want to know that we are all in it together. It took all of us to get to this point of a $1.5 trillion deficit and almost $15 trillion of debt, and it is going to take all of us to get us out of it, and the people in Colorado know that.

They want the plan to be bipartisan because they don't have any confidence in either party's go-it-alone approach on this particular set of issues and I think on many other issues as well.

The only corollary that I have added to all of that is we need to do something that satisfies our capital markets that their paper is worth what we have paid for it and that the full faith and credit of the United States is good.

We face something momentous at this moment in our country. I wanted to quote just three brief quotes from the rating agencies recently.

This is S&P, July 14:

Today's CreditWatch placement signals our view that, owing to the dynamics of the political debate on the debt ceiling, there is at least a one-in-two likelihood, 50 percent chance, that we could lower the long-term rating on the United States within the next 90 days. We have also placed our short-term rating on the U.S. on CreditWatch negative, reflecting our view that the current situation presents such significant uncertainty to the U.S.'s creditworthiness.

It is important to realize this isn't just about the debt ceiling, although that is a very important piece of this.

Here is S&P continuing:

The CreditWatch action reflects our view of two separate but related issues. The first issue is the continuing failure to raise the U.S. government debt ceiling so as to ensure that the government will be able to continue to make scheduled payments. The second pertains to our current view of the likelihood that Congress and the administration will agree on a credible, medium-term fiscal consolidation plan.

Now, I have taken the view all along that we shouldn't make raising the debt ceiling contingent because it has been a ministerial act for most of our history; it is about debts that are already incurred, not about debts that
are coming forward. But I understand the politics in the moment and time, and the only point they are trying to make is that we have to do something material or we are going to be downgraded.

Moody's also says: The government bond rating would very likely be changed to negative at the conclusion of the review unless substantial and credible agreement is achieved on a budget that includes long-term deficit reduction. To retain a stable outlook, such an agreement should include a deficit trajectory that leads to stabilization and then decline in the ratios of Federal Government debt-to-GDP and debt-to-revenue beginning with the next few years.

They said we are at a unique inflection point.

I asked Chairman Bernanke the other day at the Banking Committee--I knew the answer, but I asked him anyway--when was the last time our credit ratings were threatened for downgrade. His answer was, not in the 20th century. And I said to him, well, we are now in the 21st century. The answer was, never. Never in our country's history, that I am aware of, has our credit rating--which is the envy of the world and one of the most important assets that we have as a country and as an economy--been threatened with a downgrade. And now we find ourselves in the position of potentially being downgraded because on the one hand we might not raise the debt ceiling--which I find unimaginable, but it is possible--and on the other hand because our politics look so dysfunctional to everybody who is watching this debate that there is real concern that we can never get to a long-term debt and deficit plan where the math actually pencils. What we know about a plan where the math actually pencils is it is going to require a comprehensive approach that involves discretionary spending cuts, both for military and nonmilitary, that requires entitlement reform and tax reform.

A number of weeks ago, Senator Johanns and I sent out a letter that said just that. We passed it around the Senate offices. There are 32 Democrats who signed it and 32 Republicans who signed it. That is a pretty big number around here, and that is a pretty bipartisan effort around here.

Then I began to despair because it didn't feel as if we were making progress toward the goal many of us wanted to get to, and then today we had this conversation with the Gang of 6, who I think have presented a plan, as the Senator from Texas said, that is not perfect, and everybody is going to have a disagreement about this piece or that piece, but does meet the three-part test by and large that I have come out to the floor and I have said time and time again that we ought to meet for the people of Colorado, which is whom I represent.

What I also know is this: At this remarkable time in the country's history, if we act in a way that leads to a downgrade of this country's credit rating; if we, the 100 people who are in the Senate at this moment, don't step up to make sure that doesn't happen, no one is ever going to care what pledge was made about this or that or where we drew the line in the sand. The only thing they are going to know about us is we allowed the full faith and credit of the United States to be compromised for all time. No generation of Americans, no matter how dysfunctional their politics was, managed to sacrifice that much of our future.

I believe the only path through this is a bipartisan one, and I believe the only path through this is a comprehensive one. I think that is what the people of Colorado want and what the American people want.

So I think today marked an important turning point in the conversation we are having around here, and I for my own part believe that if we are confident in the people who sent us here, confident enough to do the job they have asked us to do, we can make sure we don't erode the full faith and credit of the United States because undoing that is going to be the work of generations if we don't protect the work of generations that have come before us. And I feel confident that we can and that we will.

Mr. President, I yield the floor, and I suggest the absence of a quorum.

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