Kent Conrad

Mr. CONRAD

Mr. CONRAD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. CONRAD

Mr. CONRAD. Let's do it amicably so we sort it out. I ask unanimous consent that the time from 12:35 to 12:40--no--12:25 to 12:30 be for Senator Durbin. Then we come back to this side. How much time did Senator Thune ask for?

Mr. CONRAD. Mr. President, I thank the distinguished ranking member for his use of my previous quotes. I am delighted to see my name up there on those wonderful charts.

Mr. CONRAD. That would be an even nicer touch. The one thing I would say that was left out was when there was a new administration and a complete change in direction in 2001, I did offer a complete alternative. My colleague is very unhappy with the President's budget. This is their opportunity, if they are as unhappy as they say, to offer an alternative. But they don't have one. They don't have an alternative. They don't have an alternative budget. They don't have an alternative vision. All they want to do is say no. They want to say no to the President's budget. They want to say no to the budget that has come from the Budget Committee. They say no to their even offering an alternative. When the situation was reversed, a new President in 2001, with a radically different vision, we offered a full alternative. I am proud we did. When I hear the other side talk about the growth of debt, I have to ask, where were they the last 8 years? Where were they? Where were they when the previous administration doubled the debt of the country? In fact, they more than doubled it. Where were they when the previous administration tripled foreign holdings of U.S. debt? As this chart shows, it took 224 years and 42 Presidents to run up $1 trillion of U.S. debt held abroad, and the previous President ran that up by more than $2 trillion. He tripled the amount of U.S. debt held abroad. We have become increasingly dependent on the kindness of strangers. Last year, under their administration, 68 percent of the new debt of this country was financed by foreign entities. Where were they when that was happening? This President inherits the colossal mess left behind by the previous administration, a debt that had more than doubled, foreign holdings of U.S. debt more than tripled, and the worst economic slowdown since the Great Depression. This President has been in office 3 months. Under the terms of the amendment they are now offering, they act as though he is responsible for debt runup during the previous administration. Please. That has zero credibility. They are saying that debt runup in the last quarter of the last administration is attributed to this administration. They say the budget that this President is inheriting for this year is the responsibility of this President. I don't think so. That is not the way I ever did the calculations. When their administration was in power, I always held their administration harmless for the first year since they were inheriting the budget of the previous administration and the economics of the previous administration. Now they want to try to stick President Obama with the failures of the last administration and say debt runup in the previous administration is his debt. I don't think so. That is not fair. That is not going to sell. Here is what happened when they were in charge. We now have China as the No. 1 financier of U.S. debt. We owe them $740 billion. Japan is not far behind. We owe them $635 billion. Where were they when this debt was being run up? I will tell you where they were. They were in full lockstep support of the previous administration. They voted for every dollar of the debt that was run up. One place I will agree with them is that it is dangerous to have run up that debt. Unfortunately, with this economic slowdown, we are going to have a lot more debt, a lot more deficits, until we are able to lift out of this and then pivot and get back to a more sustainable course. China is worried about the U.S. debt. They were worried about it before this administration, they were worried about it in the previous administration, and well they should be. If we look at any analysis of the debt we have from 2001 to 2014, who is responsible for the debt buildup? This red bar is what the Bush administration will have been responsible for. The green is the recession and interest on inherited debt. The contribution of this budget is the small yellow piece because we have the Titanic of debt coming at us. It is a result of the policies inherited by this administration, the result of the economic collapse inherited by this administration. That is the reason we have the circumstance we face today. Let me quote Senator Gregg. He was kind enough to quote me. I would like to quote him. This is what he said on March 11. He was quoting me from 2006. I stand by those quotes. This is March 11, Senator Gregg: I'm willing to accept this [short-term debt deficit] number and not debate it, because we are in a recession, and it's necessary for the government to step in and be aggressive, and the government is the last source of liquidity. And so you can argue that this number, although horribly large, is something we have to live with. He was right on March 11--by the way, my daughter's birthday, and the day before my birthday. Usually he gives me a gift on my birthday. No gift this year. I am very hurt by this. I don't know why Senator Gregg absolutely forgot my birthday. He remembers my quotes, but no remembrance of my birthday. That is OK. I still like him very much. He is a very nice person. But the place where he and I absolutely agree is the second 5 years. We have to do a lot more to get the debt under control under the President's budget, even my budget, which dramatically reduces the deficit and debt. The truth is, we have to do more. It is in the country's interest that we do. Let's talk a minute about what we are accomplishing in the budget before us. We are dramatically reducing the deficit, from $1.7 trillion this year, an all-time record, because of the dramatic economic slowdown. That means less revenue, more expenditure, exploding deficit, and $1.3 trillion of this $1.7 trillion is exclusively the responsibility of the previous President. A new President walks into a situation. He didn't construct the conditions for this year. That is the previous administration. So $1.3 trillion of this year's deficit reflects the policies of the previous administration. We hold President Obama responsible for $400 billion of the deficit this year because that is the effect of his stimulus package and other legislation that passed. So, yes, he has a responsibility for some of this deficit this year, but it is about one-fourth of what we will experience this year. Then we are dramatically reducing the deficit by $500 billion for the next year. The next year we bring it down another $300 billion, the next year another $300 billion, and, by 2014, we take it down to $508 billion, a more than two-thirds reduction in the 5 years of this budget as a share of gross domestic product, which is what economists say ought to be the comparison. Why do they say it? Because if you look at it in dollar terms, that does not take account of inflation. If you do it as a share of gross domestic product, that takes account of inflation. You can see we are even more dramatically reducing the deficit under that metric, from 12.2 percent of gross domestic product today down to less than 3 percent in the fifth year, which economists all say is what we need to do to stabilize the growth of the debt. We need to get to 3 percent of GDP or less. We do that in the fifth year and bring down the deficit as a share of GDP each and every year of the 5 years of the budget. My colleagues on the other side have offered an amendment that says-- and I hope colleagues are listening because we are going to vote on this, and we will be voting pretty soon on this proposal--if the debt is at a certain level, it will require 60 votes to write a budget resolution. Let's think about that. Let's think of the implications of what they are offering. They say, if the debt is not below a certain level, you cannot write a budget resolution unless you get a supermajority vote. Do we want to do that? I would say to my colleagues, the budget resolution is the vehicle that has all the budget disciplines in it, all the supermajority points of order against spending, and they would jeopardize those very disciplines that can help us hold down deficits and debt. What sense does that make? I ask my colleagues, does it make any sense at all to be saying we are going to make it harder to write a budget resolution that provides the disciplines to hold down spending, that provides all those supermajority points of order against additional spending? I say to my colleagues, the cure they are offering is worse than the disease. Please, colleagues, let's not go with that idea. I will tell you, in the committee, they actually offered--which I thought was the most bizarre; and I have been on the Budget Committee 22 years--in the committee they actually offered a proposal to tie our standards on deficits and debt to Europe. So we are going to adopt the European Union model under the amendment they offered in the committee. Could you imagine? Now the question of what our fiscal policy should be would be tied to France, would be tied to Italy, would be tied to Spain, would be tied to Germany, would be tied to Belgium. This is America. This is an American budget for the American people. We ought not to be tying ourselves to the French, the Italians. I love the Italians. My wife is Italian. But, my goodness, they are talking about tying our budget standards to the European Union? I do not think so. I say to my colleagues, this amendment they are offering--well intended, absolutely well intended; I do not question their motivation at all, but I do question very much the specifics of the proposal they have offered. Mr. President, I would ask to have an update on how much time remains on the budget resolution and what is the time between the sides?

Mr. CONRAD. And we are at just after 11 o'clock. What is the order that was entered last night?

Mr. CONRAD. All right. Mr. President, I say to Senator Sessions, are you seeking time on the Gregg amendment?

Mr. CONRAD. Mr. President, might I say, after Senator Sessions has used that time, or whatever additional time he might require, our intention would be to go to Senator Boxer. We cannot lock that in because Senator Gregg is not here, and we have an agreement we do not take advantage of each other in a procedural way. So I would not seek to, in any way, alter the time that remains. I yield to Senator Sessions.

Mr. CONRAD. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. CONRAD. Mr. President, it will be our intention, as I am able to reach Senator Gregg, that we yield back the time on the Gregg amendment--I have 13 minutes remaining, he has 11 minutes remaining-- and that we go to the Boxer amendment. I ask Senator Boxer, when she is available, to come to the floor. Let me very briefly respond to Senator Sessions. Let me first say that I appreciate his concern about the long-term debt, but I have to go back to the questions I was asking earlier. Where were they? Where were they when the debt was deemed doubled in the previous administration? Where were they? They were right there supporting every policy which led to that explosion of debt and which ultimately led to the sharp economic collapse we are still experiencing. This collapse is responsible for record deficits. What happens when there is a collapse? The revenue evaporates, the expenditures skyrocket, because you have more people unemployed, you have more people who need food stamps, you have more need for a stimulus package to try to give lift to the economy. So I would just say to my colleagues, I have been concerned about debt for 22 years. I have been concerned about what it would mean to the economic security of America for 22 years. I have led fight after fight after fight on this floor, whether it was Democratic administrations or Republican administrations, to keep deficits and debt down because I believe they threaten the long-term economic security of the country. Never is it more evident than now, when we financed 68 percent of our increased debt last year through foreign entities. Some say that is a sign of strength that they are willing to loan us all this money. I don't think it is a sign of strength; I think it is a vulnerability. When we are dependent on the Chinese to bankroll us, the Japanese to bankroll us, that gives them an extraordinary influence over us because if they decide to not show up at the bond auction one week, what would we have to do? We would either have to dramatically increase interest rates to attract capital or we would have to radically cut spending or dramatically raise taxes. All of those alternatives would be bad for the economic position of the United States for the long term. Mr. President, I ask unanimous consent that we preserve the time remaining on the Gregg amendment--whatever time Senator Gregg still has and the time I still have--and that we set that aside and go to the Boxer amendment, and that it be in order to return to the Gregg amendment after we complete the time on the Boxer amendment.

Mr. CONRAD. With that, we will momentarily go to the Boxer amendment. I thank the Chair, yield the floor, and note the absence of a quorum.

Mr. CONRAD. Mr. President, I wish to make clear that we had that agreement between the two sides. Although Senator Gregg is not present on the floor, we had the understanding that this is how we would proceed. With that, I note that Senator Boxer is here now and prepared to proceed on her amendment.

Mr. CONRAD. Will the Senator yield for just a moment?

Mr. CONRAD. If I might inquire of the Parliamentarian, how much time remains on the Boxer amendment?

Mr. CONRAD. I am happy to have the Senator proceed.

Mr. CONRAD. Will the Senator yield for a question?

Mr. CONRAD. Mr. President, if I could further inquire of my colleague--and I thank him for his response--has not the Speaker of the House indicated there is no intention of including a reconciliation instruction with respect to climate change in the House provisions?

Mr. CONRAD. Might I further inquire, Mr. President, of my colleague: Wouldn't it be logical for me to object if my conclusion is that there is not going to be any reconciliation instruction with respect to cap and trade? We don't have it in the Senate resolution before us. The Speaker of the House has made clear they are not going to have a reconciliation instruction to be used in the House with respect to climate change legislation. I must say, I understand the concern, but I don't think there is a basis for it. I don't think there is a prospect that there is going to be the use of reconciliation for the purpose of climate change resolution coming back from the conference committee. It is not in the Senate, the Speaker has made clear they do not intend to use it on the House side, so I would just say to my colleagues that I understand the concern, I understand making the point--that is fully legitimate--but I don't think it is a concern that is based on what is going to happen. There are plans on the House side to use reconciliation for health care and for education. That clearly is part of their resolution. Not part of ours; but part of theirs. So I have to say to my colleagues, I don't think there is a basis for concern that the reconciliation process is going to be used for climate change legislation.

Mr. CONRAD. The time on both sides has expired.

Mr. CONRAD. I must say when the assertion is made reconciliation has not been used for significant things in the past, that is not so. Welfare reform----

Mr. CONRAD. No, I am going to complete my thought and then I will be happy to yield. Welfare reform was not a significant policy change? Absolutely it was. That was during the Clinton administration. The tax changes that were made during the Bush administration were made under reconciliation. That to me was an absolute, total abuse of reconciliation. Reconciliation was designed for deficit reduction. The place where I would agree with the Senator is, I don't believe reconciliation was ever intended to write major substantive legislation. But to suggest that has not been done in the past is not so. Our Republican friends were leading the way in abusing what reconciliation is about. That is a fact. To suggest it has not been used for major changes is not so. I want to say something else. I have said repeatedly, publicly and privately, that I do not think reconciliation is the appropriate way to do climate change legislation or to do health care reform or other major substantive legislation if it is not deficit reduction. That is the position I have taken. The fact is, in this resolution before us, there is no use of reconciliation for any purpose. I want the public to be very clear. In this resolution there is no reconciliation instruction for any purpose. In the House, the Speaker has made very clear reconciliation would not be used for climate change legislation. Is it technically possible in conference that there could be an instruction that would allow cap-and-trade revenue? Yes, it is. It is possible. But let me say again, there is no reconciliation instruction in the Senate budget resolution. I have argued against it for the purposes that have been talked about and I have argued against it publicly and privately. On the House side, with respect to climate change, the Speaker has said reconciliation would not be used for climate change legislation. I take the Speaker at her word. In the conference committee I will say to my colleagues: I will strongly resist--strongly resist--any attempt to report out of the conference committee a reconciliation instruction for the purpose of climate change legislation. I don't know how I could be more clear on that point. I thank the Chair and yield the floor.

Mr. CONRAD. Would it be acceptable to the Senator to go from 12:30 to 12:35 or 12:36?

Mr. CONRAD. And then would Senator Boxer like to have time?

Mr. CONRAD. From 12:36 to 12:39. Then to come back to Senator Inhofe? Would the Senator like time?

Mr. CONRAD. We could go from 12:39 to 12:42 with Senator Inhofe. Would that be acceptable? I ask unanimous consent: Senator Durbin from 12:25 to 12:30; Senator Thune from 12:30 to 12:36; Senator Boxer 12:36 to 12:39; Senator Inhofe from 12:39 to 12:42.

Mr. CONRAD. Five minutes----