Amending the Education Sciences Reform Act of 2002

Floor Speech

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Mr. President, these are challenging economic times and Republicans have taken us to the edge of the cliff. In the limited time left to prevent government default for the first time in our Nation's history, I think we can all agree on at least one thing--the consequences of default benefit no one. That is why I made the necessary but difficult decision today to support an agreement to prevent our economy from being driven off the cliff.

Default and a downgrade of our credit have the potential to cause job loss, higher interest rates, and another economic recession or even a depression. Unfortunately, the legislation before us today only staves off potential default, while doing nothing to fuel job creation and spur economic growth. In fact, it could well increase recessionary pressures on the economy.

As the richest country in the world, we should never have reached this crisis point. The United States always pays its bills. And, let's be clear, the bills we are talking about are not new ones; they exist because of prior policy decisions.

Fault for the linking default on our debt and an ideological budget plan rests with my Republican colleagues. The President thought he could negotiate a grand bargain, but it turned out Republicans were not interested in compromise.

Since the onset of the debate surrounding the need to raise the debt ceiling, the American people have made their position clear: They want a fair and balanced approach to reducing the deficit. Like the majority of Americans, I understand the need to get our fiscal house in order, and I took tough votes in the 1990s to create a record budget surplus. On Sunday, I also voted for a plan that would have controlled spending to a greater extent than the bill before us today.

As in the 1990s, and so many other times in the past, reining in the budget deficit has meant spending cuts and revenue from closing loopholes in the Tax Code enjoyed by the wealthiest Americans and biggest corporations.

Despite this precedent and the fact that such changes would not take effect in the short term, Republicans refused to accept a balanced approach.

Indeed, the price for averting the economic disaster of failing to raise the debt ceiling--a failure that some of my Republican colleagues were quite willing to see happen, to have our Nation go off the cliff--was a deal predicated on sacrifice by the middle class and no one else.

And so the agreement forged by the President and congressional leaders is by no measure ideal. It not only makes fundamental concessions, but ignores the No. 1 issue on the minds of Americans--which is how to address job creation and the unemployment situation.

In doing so, it also evades not only common sense but ignores economists who have warned that this trend toward drastic cuts threaten to choke off a faltering recovery. Former Labor Secretary Robert Reich expressed these sentiments in saying that the agreement: ``[.....] hobbles the capacity of the government to respond to the jobs and growth crisis.''

This agreement doesn't extend unemployment insurance at a time when too many Americans remain out of work. It doesn't stave off automatic tax increases on employers in distressed States with outstanding loans from the UI trust fund. Nor does it include common sense measures to save jobs like work sharing, which has proved so effective in some of our states and abroad, nor infrastructure spending to create jobs.

Instead, the first part of this agreement includes spending cuts that could hurt the middle class and those in need--nearly $1 trillion--at a time when Americans can literally least afford it. While working men and women are coping with stagnant wages, 14 million other Americans are simply without a job in an economy that is still climbing out of a deep economic recession. In Rhode Island the jobs situation remains especially difficult and double-digit unemployment persists.

Rather than set in place a longer term debt reduction agreement that would bring much-needed certainty to the economy, this agreement brings unnecessary uncertainty by tasking a joint committee to come up with at least $1.2 trillion in deficit reduction. These recommendations would receive expedited consideration with no amendments before the end of the year. A failure of this committee to come up with the required level of cuts or a rejection by the Congress or a veto by the President of the committee's recommendations would mean sequestration--automatic across the board cuts, half to domestic and half to defense spending.

I support the need to make continued decisions to eliminate wasteful and duplicative spending, and I perhaps this committee could come to a fair and balanced approach. Yet there remains a real likelihood that Republicans could very well dig in again on the question of ending tax giveaways to very profitable corporations and millionaires and call for drastic changes to Social Security, Medicare, and Medicaid in order to meet targeted savings. The Joint Committee could also reverse the gains we made to reform health care.

In fact, Speaker Boehner, in presenting this legislation to his Republican conference, said that it would be effectively impossible for the joint committee to raise revenue. This means that the joint committee could recommend legislation even more austere and imbalanced than the $917 billion in cuts we are passing today. Republicans could again choose to balance the budget on the back of middle-class Americans. What should make us think that a few months down the road Washington Republicans will sing another tune and be willing to put revenue on the table?

Cuts are about more than just numbers. They are about priorities, and I worry that the cuts from the joint committee or from sequestration would continue to be based on Republicans' extreme ideological beliefs, and not on common sense priorities like jobs and the well-being of the middle class.

The bill before us has two outcomes as I see it. The unknowns of a joint committee that, depending on who you talk to, will either fail spectacularly or succeed spectacularly in producing a balanced proposal of shared sacrifice. The thought is that the threat of sequestration, which should be considered a meat cleaver approach to priorities, could produce an equitable compromise by the joint committee. Others believe sequestration will somehow be ameliorated or avoided altogether--that Congress will somehow pass legislation in the future to blunt its impact. I hope those positive predictions prevail, but I am dubious.

In this spirit, the agreement marks a turning point for our nation at an extraordinary time. Following the Great Depression, we faced another set of extenuating economic circumstances. And only after years of misguided cuts urged by fiscal conservatives, did the Congress finally listen to those who voiced the need for spending to buttress economic growth.

It is widely known that the best way to ensure economic recovery is to get people working--paying taxes and stimulating demand that has a multiplying effect on our economy.

Of course the irony of the situation lies in how we got here. President Bush was handed the biggest surplus on record, $236 billion--indeed, we had 3 straight years of budget surplus before he drowned our Nation in red ink as far as the eye can see.

In fact, Republicans at the time were concerned the budget surplus--which was projected to be $5.6 trillion over 10 years--was in itself a danger. Federal Reserve Chairmen Greenspan expressed this sentiment: ``The emerging key fiscal policy need is to address the implications of maintaining surpluses beyond the point at which publicly held debt is effectively eliminated.''

The resulting Bush policies--led by the $1.8 trillion tax cuts skewed to the those making over $250,000--erased this record surplus, and replaced it with a $6.2 trillion deficit over this time period. This is an extraordinary swing of $11.8 trillion from fiscal year 2002 to 2011. To give some comparison, our current-dollar-GDP, the market value of the Nation's output of goods and services, is approximately $15 trillion.

While Americans are hard pressed to make ends meet and find work in an economy that isn't creating enough jobs, the largest corporations are doing extremely well.

We are seeing now corporations rack up huge profits. The nonfinancial members of the S&P 500 index are sitting on about $1.1 trillion in cash. The Federal Reserve indicated similarly that nonfinancial businesses have about $1.9 trillion in cash defined as liquid assets. We need policies that get businesses to make investments that put Americans back to work.

So a better approach would involve a serious commitment to deficit reduction that asks more from all Americans in the interest of our Nation's long-term economic wellbeing. It would be bigger than the bill before us, perhaps closer to $4 trillion in debt reduction, because it would be balanced and would call for shared sacrifice. It would ask the wealthiest Americans and largest corporations to pay their fair share instead of relying solely on spending cuts that will hurt programs that Americans depend on particularly when economic growth remains fragile. This view is in line with numerous economic experts who have voiced concern about how cutting back too soon could undermine our recovery.

A better bill would finally discard the perverse tax loopholes that reward companies that ship jobs overseas and end ethanol subsidy giveaways to profitable corporations. Put simply, a balanced approach wouldn't ask nursing home residents to sacrifice without asking the same of wealthy folks.

In fact, I have voted for plans that took this balanced approach in 1993 and 1997 and helped create a record surplus.

I have also voted against those proposals that have built up this mound of debt--including the unfunded Bush tax cuts skewed to the wealthy; an unpaid for war in Iraq for which we have paid dearly; and the unpaid for, costly, and ill-designed Medicare prescription drug plan.

We are also missing an opportunity to address the broader problems facing middle-class Americans. They are struggling in large part because we are going down a road of conservative ideology rather than common sense. We need to work on economic growth through education, infrastructure, currency exchange fairness, a trade policy that supports our manufacturers, and yes even tax reform to simplify our system but not as an excuse for more tax giveaways like the Bush tax cuts.

Just as I have taken tough votes in the past to ensure the long-term prosperity of our Nation, today's vote was another difficult choice.

However, this agreement is the only option left to prevent default and evade what would be the greatest artificial crisis in our Nation's history. It hopefully provides a powerful lever to achieve significant and smart deficit reduction in the future.

In the words of President Franklin Delano Roosevelt during his second inaugural address, ``Government is competent when all who compose it work as trustees for the whole people.''

Now is one of those pivotal times in our Nation's history, where we face a stark choice that requires us to make sacrifices that put nation ahead of self.

For over 200 years, this country has been known as a hallmark of economic stability. We have always paid our bills regardless of who was President and what party was in charge.

Now that this manufactured crisis that has distracted us for too long is over, we need to get to the business of putting Americans back to work.

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