Proposing an Amendment to the Constitution Relative to Requiring a Balanced Budget--S.J. Res. 24--Continued

Floor Speech

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Ms. AYOTTE. Madam President, I rise today to join my colleagues in expressing my clear and unequivocal support for a balanced budget amendment to our Constitution, Senate Resolution 10.

With our out-of-control and unsustainable debt threatening nothing less than the American dream and the opportunities that will be available for our children and our grandchildren, we need to pass a meaningful balanced budget amendment, and this, in my view, can be one of the single most important steps we can take to get America's fiscal house in order and to save our country from looming insolvency.

Madam President, 49 States in this country have some requirement to balance their budget. The Federal Government should be no different. My home State of New Hampshire has a legal requirement to balance its budget and has long followed this commonsense tradition of fiscal responsibility.

This is a subject I have discussed extensively with my constituents over the last year while I have done townhall meetings throughout our State focusing on our Nation's debt crisis. I have done a PowerPoint presentation to show my

constituents the hard numbers on the fiscal state of this country. And it is deeply troubling where we are today: 3 straight years of $1 trillion-plus deficits, over $15 trillion dollars in debt, Medicare and Social Security on a path to insolvency as early as 2024 and 2036, respectively, and nearly half of our debt--47 percent--currently is being held by foreign entities, and the single biggest foreign holder of our debt is China.

I also talk about spending and deficits in terms of how it relates to your average New Hampshire family. In New Hampshire, if you use Washington's budgeting logic where we are borrowing 40 cents of every single dollar--in 2008, the New Hampshire median household income was $66,000. If you used Washington logic, the amount that family would spend would be $107,000 or $41,000 more than they earned. That would never fly in New Hampshire where families sit around their kitchen tables and they use their common sense to balance their budget. Yet in Washington we continue to perpetuate this borrowing to sustain our government every day.

If you look at where we are, one of the most troubling statistics that really impacts our economic growth is the share of our gross debt to the size of our economy or our GDP. That is now 100 percent. Just 5 years ago, that ratio was closer to 60 percent.

As many of us in this Chamber are aware, economists Carmen Reinhart and Ken Rogoff have concluded in a study that over the past century, for nations that reach where we are, where total debt reaches over 90 percent of the size of our economy, there is a negative impact on economic growth. And we can expect lower job growth and fewer economic opportunities. We certainly cannot afford that in this troubling time for Americans.

So not only do we need to get our fiscal house in order because it is the right thing to do so we are not dependent on other countries such as China to fund our government, we also need to do it so we can provide opportunities for future generations of Americans.

New Hampshire citizens understand we cannot keep spending money we do not have. They make those commonsense decisions on their own family budgets. Small business owners in New Hampshire are astounded when I tell them our Federal Government is operating without a budget. They would never run their businesses without a budget. But they do not understand why Congress cannot even perform such a basic function of passing a budget blueprint.

It has now been 958 days since the Senate last passed a budget. I have to say that I was really honored and excited to be the newest appointment to the Senate Budget Committee. However, I have been incredibly, incredibly disappointed that we have not in that committee done the hard work that needs to be done, the thing that is right for this country--to sit down, to make the hard choices, to put together a budget blueprint and to pass a Senate budget, to have the robust debate on the Senate floor about how we prioritize our spending and how we live within our means. The American people deserve better. They deserve us to do our job and to pass a budget for our country that is fiscally responsible.

In that time, in those 958 days that the Senate has not passed a budget, the Nation's debt has increased by $3.9 trillion. When you think about it, it is deeply troubling. I am hopeful that if we bring forward and pass the requirement of a balanced budget amendment to the Constitution, it will also force Congress to do the basic function of putting together a responsible and balanced budget for our country.

I cannot emphasize enough the urgency of passing this budget control measure, the balanced budget amendment, Senate Resolution 10. I think it is important for my constituents and the American people to know, if we pass the balanced budget amendment in this body, in the Congress, this is putting the question to you, to the American people, to decide, do you want the Federal Government to balance its budget?

So when we pass an amendment to the Constitution, we are simply sending along to the States the decision of should we amend our Constitution. I cannot think of anything more important than sending that question to the American people, to our State legislatures, to decide should we live within our means; should we be bound by the same requirements the States have, by the same common sense we find at home to balance our budgets and live within our means.

Madam President, for fiscal year 2011 we spent 24.1 percent of our GDP. That is well above the historical spending average of a little over 18 percent, if we go back to 1960 where the revenue we had has come in. So we are at a huge trajectory of spending at 24.1 percent. Yet in 2011 our revenues only accounted for 15.4 percent of our economy because of the difficult times we are in relative to our economic growth.

Under the Republican proposed balanced budget amendment, we put the handcuffs in place that are needed to put us on a path to eliminate this by capping Federal spending at the historical level of revenue at 18 percent. Why is this important? It is important because we can't continue to spend well beyond our means. We have to acknowledge that a meaningful balanced budget amendment will also cap Federal spending at its historical levels.

It is not difficult to see what will happen if we don't get control of our fiscal situation right now. Budget shortfalls will only get much worse, driven by massive increases in entitlement spending and interest payments, and the reality is the failure to act will result in America going the way of what we see happening in Europe right now, the way of Greece, Italy, and Ireland: our economy in tatters and our standard of living greatly diminished.

We cannot let that happen to our country. We must act now. We must pass this balanced budget amendment in the Senate and send that question to the House and also send that question to the States so the people of this country can decide if we should be responsible and have to balance our budget. Left unchanged, Medicare, Social Security, Medicaid, and other mandatory health programs alone will eventually grow to consume every single dollar of the revenues our government takes in.

Without reform, the Social Security trustees project the program will be insolvent by 2036. As a result, beneficiaries may see a benefit cut of 23 percent in just 25 years. The Medicare trustees project it is even more immediate and dire. The Medicare trustees project Medicare will be insolvent by the year 2024.

It doesn't have to be that way. We need to show the political will and courage to reform these programs, make them sustainable, and to reform them and preserve them for those like my grandparents, who are relying on them, and for future generations to know that these programs will be there. But if we fail to take this challenge on now and continue to kick the can down the road, then these programs will be greatly diminished, and they will continue on an unsustainable path that is bankrupting our country.

In this debate, it is important to remember that in 1997 the balanced budget amendment failed to pass this body by only one vote. At that time, our national debt stood at $5.4 trillion. We now have a $15 trillion debt. That debt equates to about $128,000 per household. That is a huge amount of money to an average household. Under the Budget Control Act, which I opposed last August, the debt will be allowed to reach a new limit of $16.4 trillion, left unchecked.

Congress has raised the debt limit 79 times since 1960, and in just 4 short months since the debt limit was last increased, over $700 billion has been added to our debt, since we took that action in August.

Speaking of the debt limit, the Republican-backed balanced budget amendment will require a congressional supermajority to raise the debt ceiling. That means three-fifths of both Chambers will have to approve unless it is a time of war. That would require a majority in a time of war. That is a very important measure because we can't continue to increase the debt limit without addressing the underlying drivers of this fiscal crisis that faces our country.

I also want to briefly touch on taxes. The Republican version of the balanced budget amendment, S. Res. 10, would require a supermajority to raise tax rates. We have a spending problem, not a revenue problem. Under S. Res. 10, a two-thirds approval of both Houses of Congress would be required for any bill ``that imposes a new tax or increases the statutory rate of any tax or the aggregate amount of revenue.''

My friends on the other side of the aisle are proposing an alternative--S. Res. 24--to the balanced budget amendment that I have just described. While this proposal sounds good, it fails to squarely address the magnitude of the challenges we face. It doesn't apply to all spending. It also doesn't contain a cap on spending. It does nothing to strengthen our entitlement programs, and it does nothing to make it harder to raise taxes. It does nothing to make it more difficult to raise the debt ceiling. In my view, it is insufficient to be meaningful to pass along to the States for a vote.

The Republican alternative contains the elements that I just talked about--a balanced budget, spending caps, a supermajority to raise taxes, and making it more difficult to raise the debt ceiling, unless and until we address the underlying causes of our fiscal crisis.

This issue is deeply personal for me. I fundamentally believe all of us have a duty to make this country stronger than we found it. As the mother of two young children, Katherine, now 7, and Jacob, 4 years old, who are both very excited for Christmas, I want the American dream to burn as brightly for them as it has for me. It is not too late for our country or for this body to make the tough decisions that will put our country on a fiscally responsible path.

I feel a solemn duty to make sure we make those choices now and that we don't continue to kick this can down the road to future generations and burden them with a debt they did not incur. The last thing I want is for my children to ask me: Mom, you knew we were going bankrupt. What did you do to save our country?

Now is the time for courage. All of us recognize the enormity of the fiscal challenges we face, as well as the dire cost of continued inaction in this body. The Republican balanced budget amendment provides a solid foundation that will set our Nation on a fiscally responsible path. This is an urgent need that we have right now. We cannot do what we did in 1997 and fail to pass the balanced budget amendment. We should send this question to the States and let them decide, let the people of this country decide: Should we live within our means? Should we balance our budget? Should we deal with this debt crisis now and make sure our children and all children and our grandchildren will have the same opportunities we have been blessed to have in the greatest country on Earth?

I urge my colleagues to support S. Res. 10.

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