Moving Ahead for Progress in the 21st Century Act

Floor Speech

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THE BUDGET

Mr. GRASSLEY. If a Republican like this Senator says that the President's 2013 budget doesn't pass the smell test, I would probably have half the country questioning my judgment. But I would like to quote the Washington Post's Dana Milbank's comments on the President's budget. This was recently in the Washington Post, these words by a columnist who I think is generally pretty favorable toward President Obama as a person and his administration, but there is great disagreement by this columnist about the President's budget.

The White House budget for fiscal 2013 begins with a broken promise, adds some phony policy assumptions, throws in a few rosy forecasts, and omits all kinds of painful decisions ..... the proposal would add $1 trillion more to the national debt than Obama contemplated a few months ago.

Dana Milbank added that the Obama budget ``is a nonstarter on Capitol Hill, where even Senate Democrats have no plans to take it up. It is, in other words, exactly what it was supposed to be: a campaign document.''

So with that background from somebody who is not a Member of Congress, not a Republican or Democrat--I don't know how he might be registered--I would like to give my views on the President's budget, but just so that people know it isn't just Republicans who disagree with the President's budget.

I think you could sum up the President's budget with three words that might say you are giving it a D grade, and probably most people would give it an F grade, but they would be debt, deficit, distrust, and disaster--too much spending, too much taxing, and too much debt. This comes from the fact that earlier this week the President submitted--as he has to every year--a budget proposal, and this budget proposal was all too predictable. It was predictable because it follows the same path as his previous three budgets. With breathtaking irresponsibility, the President's 2013 budget would expand the scope of government by spending more money, increase taxes on job creators, particularly small business, and continue on the path of enormous deficits and record debt--déja 2 vu.

The President's budget proposal is supposed to be a serious document, a document that lays out the President's priorities along with the President's ideas on how to address our national fiscal and economic challenges. This budget fails those goals miserably.

As a member of the Budget Committee, I have heard from numerous experts who come before that committee about the need for Congress and the President to get serious about the fiscal cliff we are approaching. We have had deficit commissions--you remember Simpson-Bowles, as an example--we have had task forces, and we have had what we call gangs, the Gang of 6, six Senators trying to work things out, and other Members of Congress. All have put forward deficit reduction plans. It is going to take more than a commission, and the President didn't even back the recommendations of his own commission a year ago. It is going to take more than task forces, and it is going to take more than gangs of Senators because the single most important political and moral leader in America is whoever holds the Presidency of the United States.

In this particular instance of this executive budget, that person and that document has failed to lead on this critical issue. It does not matter how many commissions, how many tasks forces, and how many gangs of Senators we have, without Presidential participation a problem as big as this country's national debt is never going to be solved.

What President Obama put forward on Monday of this week is not a serious budget. As I said before, it is a political statement. The fact is Americans are going to pay a heavy price for the President's unwillingness and inability to lead.

While President Obama claims his budget will create an America built to last, his budget builds higher deficits and debt, a bigger, more intrusive government, and economic decline for future generations.

We want to remember that more important than the economic points of a budget is, when we get a more intrusive government, the less economic and social freedom people have.

By nearly every fiscal measure, President Obama's budget makes matters much worse. Not only has the President chosen to ignore the looming fiscal catastrophe, he has chosen to continue the course and even step on the accelerator.

This year, the Federal Government will spend $3.8 trillion--equal to 24.1 percent of our GDP. During the past 60 years, we have averaged about 21 percent of GDP. So we quantify government growing dramatically from taking 21 percent out of the economy--that government spends, 535 Members of Congress spend; instead of 300 million Americans--and that is raised to 24.3 percent.

Alarmingly, over the 10-year period ahead, in the 2013 budget, in this budget, spending never gets below 22 percent. So forever they are growing government and detracting from individual freedom.

The President intends to lock in historically high levels of spending. Do not take it from me, but it is right here in these budget documents we have all been given this week. He is a big spender of other people's money.

In dollar terms, spending goes up from $3.8 trillion this year to $5.8 trillion 2022. Over a 10-year period of time, this budget spends about $47 trillion, and during that period of time, it increases the national debt by $11 trillion. So it is clear this document the President gives to Congress under law is built to spend.

President Obama's budget is also harmful to our fragile economy because it would impose a $1.9 trillion tax increase.

I always go back to what I thought was a very wise decision President Obama made about 2 or 3 weeks before he actually took the oath of office. During the campaign, he reminded everybody he wanted to raise taxes. But when he got to being sworn in, he looked at how bad the economy was, and he clearly said it is not too wise to raise taxes when we are in recession.

Maybe technically we are not in a recession, but for the 8.3 percent of the American people who are unemployed, it is not just a recession, it is also a depression for each one of them.

So since the unemployment rate stands at 8.3 percent, and the President seems to be just fine this year, compared to 3 years ago when he was sworn in, that hiking taxes is not going to be harmful to the economy, it is not going to be harmful to those 8.3 percent of the people who are unemployed and looking for jobs, it is going to be. So why has the President flip-flopped on this issue of whether you ought to increase taxes when people have such high unemployment rates?

This tax increase will harm the economy and result in fewer job opportunities, particularly among the small businesspeople who create or provide for 25 percent of the jobs in America and generally create 70 percent of the new jobs in our economy. That is where it is going to be very harmful.

I recently asked Federal Reserve Chairman Bernanke about the prospects of a tax increase and the impact it would have on our economy. He indicated a significant tax hike could slow the economy, slow the recovery. In my question to him before the Budget Committee, I quoted the Congressional Budget Office that says unemployment would go up and the economy would grow less if we had this big tax increase the President wants.

The President has spent many hours speaking about helping our economy, investing in our future, and increasing economic opportunities for all Americans. While he is saying all those things that he is probably sincere about, at the same time he does not put his actions where his words are because he does not allow a pipeline to be built that will create 20,000 jobs right now and 110,000 indirect jobs connected with it.

If he gets his wish to hike taxes by $1.9 trillion, it will harm all Americans, further prolong this already 3-year slowdown, while growing an even larger, more intrusive Federal Government impinging upon personal liberties to a greater extent.

Maybe the President's purpose in imposing this huge tax increase is an effort to reduce the Nation's debt and that is probably what he would tell us, and he may truly believe that. Unfortunately, that is not what he has planned. He wants to spend every dollar. His budget leads to an additional, as I said before, $11 trillion increase in debt--national debt--over the next 10 years. Debt held by the public increases from 74 percent of our economy today to 76 percent of our economy by the year 2022, at the end of this 10-year budget window.

We have to compare that to the historic average since World War II, and that was just 43 percent, compared to where it is right now: 74.2 percent, going up to 76 percent.

If people believe President Obama is putting us on a path to fiscal sustainability by taxing increases, I would suggest they look at the annual deficits over the next 10 years. These deficits never drop below $575 billion, and actually go up toward the end of his budget, rising to $704 billion by 2022. This budget puts America on the course of deficits and debt as far as the eye can see into the future.

Additionally, the President took a pass on proposing any real changes to our entitlement programs, which are the real driver of future deficits and debt. That is only part of it. The main part of it is, do we want to preserve Social Security, Medicare, and Medicaid for future generations? Because if we do not do something about it, it is not going

to be preserved. Again, he is absent from the discussion when Social Security, Medicare, and Medicaid comes up.

He has offered no solution in this budget, even though the Simpson-Bowles Commission he appointed--he never endorsed their recommendations 1 year ago; and why he did not endorse and trust the people he put in place to get a solution to these problems I do not know, but even the Simpson-Bowles Commission has solutions for Social Security, Medicare, and Medicaid. That is further evidence that the President has chosen not to lead on these very difficult issues.

President Obama has spoken a lot lately about the issue of fairness. President Obama believes this type of budget, with higher taxes, more borrowing, and enormous deficits and debt will bring about fairness.

If the President is referring to sharing in our Nation's economic decline, he is right. If he is talking about sharing in a Japanese-like prolonged period of stagflation, he is right. If he is talking about sharing in an economic collapse such as the one going on in Greece, he is right. It may not be tomorrow, but all signs point down the road in those directions because based upon the national debts of those particular countries, that is where we are headed.

The budget proposed by President Obama will have all Americans sharing in higher taxes, a larger, more intrusive government, less freedom, and deficits and debt that will lead to economic decline for future generations.

We all know a large budget deficit reduces national savings, leading to higher interest rates, more borrowing from abroad, and less domestic investment, which, in turn, would lower income growth in our country.

This will hurt the lower and middle class the most. The gains President Obama touts in his budget that he is delivering to the middle class will be dwarfed by the loss of economic activity caused by deficits and debt.

This is not a serious document. It is a political document. As evidence of how out of touch this budget is, few of my Democratic colleagues have even acknowledged President Obama submitted a budget, much less defend it.

I hope the Senate will have an opportunity to debate and vote upon President Obama's budget. Last year, we had such a vote. Last year, the President's budget was defeated in the Senate by a vote of 97 to 0. Not a single member of the President's party supported his budget.

So when constituents ask me why we cannot do something in a bipartisan way in Congress--and we do a lot in a bipartisan way that does not get the attention of the press, so people are cynical about Congress being bipartisan--I quote a 97-to-0 vote about whether there is bipartisanship, and that was a vote against the President's budget. Every Republican and every Democrat agreed. Once again this year, if we ever get this to a vote, I predict that very few, if any, will support this budget.

Quite frankly, it would be humorous if the consequences of inaction were not so serious. We have a moral obligation to offer serious solutions for today and for future generations. The President's budget fails in this responsibility. He has chosen a politically expedient path rather than a responsible, forthright path.

Our grandchildren and great-grandchildren will suffer as a result of this failure, and that suffering comes from this fact: that for nine generations of Americans, each succeeding generation has lived better than the previous generation, and a lot of Americans feel that is not going to happen with the next generation. That would be a sad commentary.

I yield the floor.

I suggest the absence of a quorum.

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