Default Prevention Act of 2013 - Motion to Proceed

Floor Speech

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Mr. DURBIN. Mr. President, for 2 weeks the government has been shut down. It is hard to imagine. It seems a lot longer if you have been sitting here in the midst of this maelstrom--2 weeks since the junior Senator from Texas took the floor and for 21 hours held the floor, giving a speech calling for the end of ObamaCare as we know it.

In that period of time we have learned a lot about ourselves. We learned a lot about this country. I think about the 800,000 Federal employees furloughed, many of whom struggle to get by and now have no paycheck coming in. It is a hardship that is totally unnecessary, a hardship that was imposed on them because there was a strategy, a political strategy, political gamesmanship that said: We can sacrifice the well-being of those Federal employees and their families to make our political point.

It turns out they went further. They went further in suggesting they were going to cut off the benefits these government agencies offered. At this point in time, we have come to learn what that means. People who were turned away from the National Institutes of Health, children--some 30 children with cancer were turned away because that agency is closed. Families who were notified they had lost a loved one in battle were denied the basic benefits we provide to all families facing that terrible grief. There was a lack of food safety inspections when salmonella outbreaks were being reported around the country. The list goes on and on.

John F. Kennedy wrote a book called ``Profiles in Courage'' that talked about those in public service who showed extraordinary courage. I suggest it takes no courage whatsoever to hurt 800,000 innocent Federal employees. It takes no courage whatsoever to deny the basic benefits of government to thousands, maybe even millions, of American people. I think it is political cowardice.

Sadly, it has gone on for 2 straight weeks. The House did some curious thing there, where they voted to say: But we will pay these employees.

A friend of mine back in Edwardsville, IL, sent me an e-mail.

Let me get this straight. They closed down the Government, they turned the employees away, they said they don't have to come to work but they promised they were going to pay them? What is going on in Washington? What are you people thinking?

I couldn't defend it. I wouldn't even try. It is evidence of the kind of abandonment of reason which has become the hallmark of some Members of Congress.

What do the American people think? They are not happy with any of us, let's get it straight, but when it comes to the responsibility for this madness, they have said it is on the other side of the aisle. It is their idea--not just the tea party but many who were complicit in this strategy.

As if this were not enough, now in just 2 days, for the first time in the history of the United States of America, we face a default on our debt.

You might say: So what. Who cares. What difference would it make.

Listen to what Christine Lagarde, chief of the International Monetary Fund, said:

The failure to raise the debt ceiling would cause not only serious damage to the U.S. economy but also to the global economy as a result of spillover effects. .....

In response to a question about debt prioritization proposals, she said:

When you are the largest economy in the world, when you are the safe haven in all circumstances, as has been the case, you can't go into that creative accounting business.

Christine Lagarde, chief of the International Monetary Fund.

It is an interesting thing in politics: you can always find somebody who is going to agree with almost any point of view. Tea party Republicans have rounded up some flat Earth economists who say default on the debt is really not a big deal. In fact, I have heard some of my colleagues on the floor argue that we just have to pick and choose who is going to get paid, that everything will work out and you really will not even notice.

It reminds me of the time--Mr. President, you were in the House when I was--when there was the Gingrich shutdown, Rush Limbaugh and others announced they would shut down the government and no one would notice. You don't really need a government. They noticed in a hurry. In less than 2 weeks they opened the government.

This, sadly, is much more grievous and will have terrible consequences for innocent people. If we default on our debt in 2 days, for first time in history we will destroy a global confidence in the U.S. dollar that we built up since World War II, since 1945. Right now the U.S. dollar is the most respected and strongest economy in the world, period, bar none. Countries far and wide that want to invest in the safest possible investment invest in U.S. Treasurys because they trust our government and its word that it will pay its debts. Those who are toying with this possibility of default are putting that at risk.

It is not just a matter of the views of the world. It is bad enough that we are being lectured to by Vladimir Putin about responsible governance--Vladimir Putin lectures to us about being a responsible government. That is bad. What is even worse is the impact on ordinary people and their lives. We know what happened when we went through the last recession. People who had carefully saved for their futures saw the bottom fall out of their savings accounts and their retirement accounts. We run that very same risk if we default on this debt again. We run that very same risk. And many hard-working families, people who have scrimped and saved for college education for their kids, for their own retirement, for their next home, will find that they are devastated by this default on our national debt. That is the most reckless and irresponsible single act we could undertake.

They asked a Member of the House, a Republican Member of the House, if yours was the deciding vote on extending the debt ceiling--if it was up to you, one person, to decide to extend the debt ceiling, would you vote for it? He said: Not unless there were some strings attached. You think to yourself: Still bargaining, right up to the edge of the cliff. Sadly, if we go over, the pain will be felt as much by that Congressman as it will by working families in Massachusetts and Illinois. That is what this is all about.

Paul Schott Stevens is president and CEO of the Investment Company Institute. At a banking committee hearing on October 10, he said:

I also will avoid parsing the differences among ``technical default, ``selective default,'' and ``actual default,'' or whether missing a Social Security payment is equivalent to missing an interest payment or failing to redeem a maturing Treasury bill. All such discussion misses the point. The United States, like any other major debtor, must maintain the confidence of its creditors--or risk the consequences. .....

Once Treasury has exercised the option to delay payments, investors will learn a lesson that cannot and will not be unlearned--even after all missed or delayed payments have been made good. That lesson is simple: Treasury securities are no longer as good as cash--they carry a future risk of further missed payments.

That future risk is a political creation. It is a bargaining tool by the Republicans, and it goes too far.

At a banking committee hearing, Gary Thomas, president of the National Association of Realtors, said:

[A]n increase in U.S. Treasury rates would result in higher mortgage rates. In the event of a default, U.S. Treasury prices would fall and yields, which move inversely to prices, would rise. ..... Historically, an increase in mortgage rates of 1 percentage point reduces home sales by roughly 350,000 to 450,000 units ..... [and] roughly 700,000 to 900,000 fewer jobs would be created. .....

This is a job-killing strategy. Default on our national debt is a job-killing strategy.

Kenneth E. Bentsen, Jr., president of the Securities Industry and Financial Markets Association, said:

It is important to note that Treasury securities are a key factor in the daily financing of market operations, with the U.S. Treasury repo market totaling between $1.2 and $1.9 trillion daily. Undermining that market could have a deleterious effect on every major market participant.

If that were not bad enough, I have received some e-mails from some friends. The one that sticks in my mind is from a friend who does not live in my State. He is a man I have come to know. I am not going to use his name on the floor--I didn't ask his permission to--but I can certainly tell his story.

He sent his son off to war in Iraq. He and his wife took care of his son's wife and little baby while his son went off to fight in a war. Sadly, his son was the victim of an IED. As a result of that terrible incident, his son is quadriplegic and cannot speak.

People had given up on the son in his midtwenties; they recommended putting him in a nursing home. And his father said: I just won't let it happen. His father took him to a hospital in Chicago, a renowned hospital, the Rehabilitation Institute of Chicago. His son made dramatic progress. Eventually, he was able to return home with some limited function but was able to enjoy the things in life that make a difference to him. He loves to go hunting. His father picked up a mechanism whereby his son could actually go out, sit in a blind, and fire at those ducks and feel as if he was back where he was before he went to war.

I cannot tell you the love that the mother and father have given to their son, daughter-in-law, and now their two children. They basically gave up their life and their business and, with the help of a lot of good people in the community, built a special home for their son so that he could get around in his motorized wheelchair.

I have been down there. The outpouring of generosity and charity in North Carolina for this family is just amazing, and they continue to give their entire lives to their son and his wife and kids.

He wrote me an email and said:

I hope you are doing well. We see you on C-SPAN. Thank you for taking a moment to read about our concern. This concern is about my son. It affects him and thousands of other wounded veterans. We are quite concerned about what we are hearing coming out of the VA. The thought of the VA check not arriving in November has all of us nervous. We are sure this is a feeling in households across the country. We are praying that all the parties in Washington will soon come to terms. After years of war, a sagging economy, and now the shutdown, nerves are stretched. I am writing to you to see if there is a light at the end of this dark tunnel. My son and wife, after years of working to establish a near-normal life, have to start worrying about losing what they worked to return to and enjoy as a near-normal life.

In writing he said:

My mood does not mean to be so down, but as a parent of a family that has been through so much, the thought of this threat is very heart-wrenching.

Thank you for listening to me.

I think of that letter, and I think of that family worried about that VA check.

I received an e-mail yesterday from a family that is worried about whether they will receive their Social Security check. Why do we put the American people through this? Why do we put families through this? This is totally unnecessary.

We need to open this government. We should do it tomorrow morning, period. Just open it. We need to bring these people back to work to perform the services they need to perform for this great Nation, and we need to make certain we don't default come Thursday. The default would have a negative impact that would have far-reaching consequences beyond this political battle.

In years to come nobody may remember the names of the people involved in this political fight that goes on day after day on Capitol Hill, but they will remember the failure of the Congress to pay the Nation's debts, to stand for the full faith and credit of the United States, and to maintain our reputation as a leader in the world.

That is what is at stake. There is no political victory worth that. I hope Members on both sides will come to their senses.

I wish to salute our leader, Senator Harry Reid of Nevada. I have been standing by him through this. He has been stalwart and courageous. I know he has been exhausted at times, but he keeps on fighting.

I also wish to salute Senator Mitch McConnell of Kentucky, the Republican leader, who, over the last several days, has played a very active and positive role in trying to resolve this issue.

It is time for the Senate to show leadership. It is time for the Senate to come together on a bipartisan basis and show the path that takes us out of this political crisis.

I yield the floor and suggest the absence of a quorum.

The PRESIDING OFFICER. The clerk will call the roll.

The legislative clerk proceeded to call the roll.

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Mr. DURBIN. I ask the majority leader, through the Chair, one of the key elements in this new proposal from Speaker Boehner is to diminish this President's authority to deal with a default on our national debt. This authority, so-called extraordinary measures or emergency measures, gives to Presidents, going back to President Kennedy, the wherewithal through the Treasury Department to try to avoid an economic disaster which could impact families, businesses, jobs, and the reputation of the United States in the world.

I ask of the majority leader, through the Chair, now that we have seen the Republican Party bring us so close to the precipice on a default, it is unimaginable to me that any President, including President Obama, would surrender this authority to keep America safe in light of this type of threat. Is this one of the key elements in terms of the problems associated with the Boehner proposal?

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