Judd Gregg

Mr. GREGG

Mr. GREGG. Mr. President, I rise to speak on a couple of items. The two things I wish to speak about are, first, this rumbling we are starting to hear about having a third stimulus package. Some people say it is a second. It is a third stimulus package. We did a tax stimulus package about $140 billion and the $700-plus billion stimulus package earlier this year. It is incomprehensible to me that we would want to have another stimulus package unpaid for and add that to the debt. We are facing a massive explosion of debt in this country. The best thing we can do to get this economy going would be to show the world and the American people we are serious about doing something about our debt. To roll out another stimulus package in the face of that type of a situation that would be unpaid for is a huge mistake, whether it is a tax cut or whether it is spending. I cannot understand why we are even thinking about it. When we look at the stimulus package which was just passed a few months ago, that hasn't even spent out. Only 15 percent of that is going to be spent this year, and another 37 percent of it will be spent next year. That means we still have 50 percent of the spending of that $700-plus billion bill to occur in 2011 and beyond. So if the purpose of a new stimulus package is to try to bring up the slack in the economy as we move into 2010 and on to 2011, we do not need it because we already have a stimulus package that is coming down the road, if you accept that as being useful--I don't happen to--but it is clearly counterproductive if it is simply going to add to and increase the debt of this Nation and the debt that is passed on to our children. The debt of this country is increasing to astronomical proportions. We are looking at deficits of 4 to 5 percent of GDP for the next 10 years. We are looking at a debt that goes to 80 percent of GDP. The new stimulus would aggravate both those numbers dramatically. To quote my colleague from North Dakota, the chairman of the Budget Committee, the debt is the threat. If we continue to pass through this Congress spending which is not offset, which is not paid for, in the name of stimulus or anything else, we are simply aggravating this extraordinarily difficult situation, which is the massive explosion of Federal debt. It is not fair to our children. More importantly, it is not correct, and it is not good policy. Nothing would energize this economy more than to have the world look at America and recognize that we are going to do something substantive about reducing our debt and our deficits. People around the world and in our Nation would have confidence in our government again. But if we continue to talk about rolling out another stimulus upon the stimulus we already have--the first stimulus and the second stimulus--rolling out a third stimulus, which will be unpaid for and expensive, that is not sound fiscal policy. Since the debt is the issue, let me turn to the second point I wish to make. The TARP, which has received a lot of negative press over the last few months, has accomplished its purpose in large degree. The reason the TARP was passed was to stabilize the financial industry during a period when it looked like we were going to have a cataclysmic implosion of the financial industry. We were on the verge of a catastrophic event, where basically our whole financial industry would have melted down, bringing down with it Main Street and people's ability to get loans, people's ability to send their kids to school, people's ability to buy a house, to meet a payroll, run a small business. All that would have been at risk if the financial institutions of this country had been allowed to implode, which is exactly where we were back in September and October when the TARP was passed. With those TARP dollars, those financial institutions are stabilized, and they were stabilized by purchasing what is known as preferred stock in them. As part of the TARP, it was made very clear that the $700 billion that was going to be spent to stabilize the financial institutions, or potentially spent--not all of it was spent--that those dollars, when they came back--and we expected them to come back because it was an investment; it was not spending like a stimulus package where we essentially put money out the door and it never comes back; we were buying assets, the preferred stock of these banks. When those moneys came back to the Treasury, it was understood that those moneys would be used to reduce the deficit and the debt. That was the understanding that was written in the bill. The moneys from TARP, as they came back in, would be used to reduce the debt. We are now seeing the first group come in. Mr. President, $70 billion has come back to the Treasury as a result of four or five major banks paying off the TARP moneys through repurchasing their preferred stock. Interestingly enough, the taxpayers made some money here. We made about $4.5 billion on that investment--a pretty good deal over 4 months to make $4.5 billion. That money is also coming to the Treasury. Those dollars should be used to reduce the debt. That is what the whole idea was: Buy assets, stabilize the financial industries, as the assets come back, pay down the debt that was run up in order to purchase those assets. Unfortunately, some of my colleagues in the other body have suggested that we now start spending this money as it comes in on what happens to be, I am sure, very worthwhile initiatives which they want to pursue in the area of housing, in the case of one proposal. That would be the totally wrong thing to do. These dollars have to be used to reduce the debt, and by using them to reduce the debt, once again we will make it clear to Americans and to the international community that we are going to act in a fiscally prudent way, and we will have a very positive impact on how much it costs us as a nation to borrow on the value of our dollars and on the amount of outstanding debt which we face as a nation, which is extraordinary, as I mentioned earlier. It is totally inappropriate to spend this money on something other than what the proposal originally was, which was to spend it to stabilize the financial institutions and then take the money we received--in this case, with interest--and use it to pay down the debt. The administration understands this, and I respect the fact they made it very clear in a letter to me from Secretary Geithner--I ask unanimous consent to have printed in the Record the letter from Secretary Geithner.

Mr. GREGG. Mr. President, Secretary Geithner has made it very clear that they understand this money should go to reduce the debt. They would like to hold it sort of at the desk for a few months to make sure they are not going to need it for another event of maybe severe fiscal strain. But it is pretty obvious we are past that time and they probably are not going to need it. So this money is coming back to the Treasury and will only be used to reduce the debt unless we, as a Congress, change the law. I wished to come to the floor and say it would be a real failure of fiscal stewardship for us to use these dollars for anything other than what their purpose was, which was to reduce the debt. I yield the floor and suggest the absence of a quorum.

Mr. GREGG

Mr. GREGG. Mr. President, I rise today to pay special tribute to U.S. Army SSG Edmond Lo of Salem, NH. Tragically, on June 13, 2009, this brave 23-year-old gave his life for this Nation when an improvised explosive device detonated while his explosive ordnance disposal team courageously worked to neutralize the threat near Samarra City, Iraq. At the time of this hostile action, Sergeant Lo, a member of the 797th Ordnance Company based at Fort Hood, TX, was serving his second tour in Iraq in support of Operation Iraqi Freedom. Edmond demonstrated a willingness and dedication to serve his country from an early age. A 2004 graduate of Salem High School, Edmond was a member of the Air Force Junior ROTC Program and commander of the drill team, color guard, and operations squadron. He was well known and liked by his teachers and fellow students and earned himself a full scholarship to a top engineering school upon graduation. However, sensing a call to duty, and because of his desire to protect his country, Edmond instead chose to join the Army. Just as many of America's heroes have taken up arms in the face of dire threats, Edmond dedicated himself to the defense of our ideals, values, freedoms, and way of life. His valor and service cost him his life, but his sacrifice will live on forever among the many dedicated heroes this Nation has sent abroad to defend our Nation's freedom. A beloved member of the Salem community, Edmond was respected and admired by all those around him. As a loyal member of the U.S. Army, he continually performed above and beyond all expectations. Because of Edmond's efforts, our liberty is more secure. Kathy's and my thoughts, condolences, and prayers go out to Edmond's parents, David and Rosa Lo, his brothers and sisters, and his other family members and many friends who have suffered this most grievous loss. All will sorely miss Edmond Lo, a true patriot who was proud of his family, proud of where he lived, and proud of what he did. In the words of Daniel Webster--may his remembrance be as long lasting as the land he honored. God bless Edmond Lo.

Mr. GREGG

Mr. GREGG. Reserving the right to object, as I understand it, we are supposed to be moving to the supplemental. There is a unanimous consent agreement which has been reached. Hopefully, that will be placed in order.

Mr. GREGG. I object to any more unanimous consents.

Mr. GREGG. I am objecting to the one the Senator from California just propounded.

Mr. GREGG

Mr. GREGG. Madam President, I rise to speak on the supplemental. Did the chairman wish to speak?

Mr. GREGG. I am happy to yield to the chairman if he wishes.

Mr. GREGG. Madam President, first off, this is a very important piece of legislation. I congratulate the chairman and the ranking member, Senator Cochran and Senator Inouye, for bringing it forward. It is critical that we adequately fund our troops in the field. This is our first responsibility as a government when we have troops in the field in harm's way--to give them the resources they need in order to protect themselves and defend our liberties. So this is a very important piece of legislation, and it must pass. It simply must pass. However, ironically, as occasionally occurs around here--but in a piece of legislation that is this important to our troops shouldn't occur--this legislation had air dropped into it by the House of Representatives something that has nothing to do with our troops fighting in the field, and that is a bill called the cash for clunker bill. I have no personal or philosophical disagreement with the concept of purchasing automobiles that are high-mileage vehicles, and they use a lot less gas, and exchanging them for lower mileage vehicles as an attempt to revive the economy and the auto industry and at the same time, hopefully, accomplish some environmental protections. I would simply note, however, that this bill that was air dropped into this legislation doesn't accomplish that. Basically, this is a bill that was drafted in the House without the input of the Senate. There was a much better bill in the Senate-- Senator Feinstein and Senator Collins had it--which would have actually meant some mileage differential would have occurred, but it was not allowed to be put in because the bill, as it was put into the conference report, was unamendable. So the bill itself is flawed because it basically only allows--it allows you to exchange your car and get money for your car, but the increased mileage on the new car you buy only has to be a mile or two a gallon, which is virtually nothing. It has virtually no impact. So the philosophy of the bill itself is flawed. But the real problem with this bill, besides the fact it is in a piece of legislation it shouldn't be in, is the fact that it is totally unpaid for. It is $1 billion of new costs put on our children's shoulders. It is $1 billion of new spending put on the Federal debt. We already know the Federal debt isn't sustainable. Almost every day we are hearing international purchasers of our debt-- whether it be China or whether it be Russia or whether it be international economists or economists in the United States--saying the American debt situation has gotten out of control, and that we are at risk as a nation of having a situation where the cost of our debt will go up dramatically because we are putting so much debt on the books. Under the President's budget, the deficit of the government will be a trillion dollars a year, on average, for the next 10 years. We will be running deficits of 4 to 5 percent of gross national product. The deficits will equal 80 percent, and we will have a debt that will equal 80 percent of the GDP. Just within the next 3 years, it will be 60 percent of the GDP. At the end of 10 years, it will be 80 percent. What does that mean? It means we will have a debt and a deficit situation that will lead us down the road to having a government we cannot afford and our children cannot afford. Ironically, as I said before, our debt is getting so out of control and our deficits are getting so high and out of control that if we as a nation tried to enter the European Union, which is a group of industrialized countries that has rules as to what a country can do in the area of debt and deficit for solvency reasons, we could not get in because their rules say you cannot have a debt or deficit of more than 3 percent, and your debt-to-GDP ratio cannot exceed 60 percent. Latvia or Lithuania or some other nation might be able to get into the European Union, but we could not. Our debt is an incredibly serious problem for us as a nation and for our children. The irony is, the bill that was airdropped into the defense bill, designed to pay for the troops in the field, came on the exact same day that the President of the United States and the Democratic leadership of the Congress met down at the White House to announce they were going to reinstitute the pay-go rules. What are the pay-go rules? The pay-go rules require that when you spend a dollar, you pay for it; when you create a new program, you pay for it. The President, with great fanfare, said the Democratic leadership of this government--the President and leadership of the Congress are going to put into place the pay-go rules. All future spending will be subject to pay-go rules, with a few exceptions he listed, which were pretty big exceptions. He didn't list this bill, which spends a billion dollars and is not paid for. After that press conference, which occurred around 12:30 in the afternoon, the House of Representatives passed the cash for clunkers bill, which spent $4 billion dollars, and it wasn't paid for. That bill added $4 billion of new debt to our national debt--debt which will be paid by these young people up here, who are pages today, when they get jobs. What excuse do we have as a government for passing a bill to purchase cars today and sending that bill to our children and grandchildren as part of the debt we are passing onto them? It is inexcusable. It would be easy enough to pay for this bill. There are innumerable places in the government, which is spending trillions of dollars a year, to find a billion dollars to pay for this bill if it was a priority. Clearly, if the President and the Democratic leadership are going to call on us to follow pay-go rules, we should follow them--at least for a day. They couldn't even get through a day without violating the rules they said they were going to follow--a billion dollars of new spending, which is unpaid for. Whether you agree with the policy of the bill or not--this cash for clunkers bill--the issue is it spends a billion dollars and doesn't pay for it and adds it to the national debt, which is out of control. The American people know it is out of control, and it is inexcusable that this Congress cannot discipline itself. I have made a point of order that doesn't bring down the bill and doesn't harm our ability to fund the troops in the field. I made a point of order under a new point of order that was put into place at the beginning of this Congress by the Democratic leadership of this Congress in the Democratic body. This was a good rule. It was put into place by a bill entitled the ``Honest Leadership and Open Government Act.'' Again, it is the Honest Leadership and Open Government Act. Its primary sponsor was Senator Reid, and its second sponsor was Senator Durbin, along with Senator Schumer and Senator Stabenow. The bill was structured for the purpose of not allowing what happened with this defense bill, which is that people airdropped it into special interest legislation--unpaid for in this case. It is called rule XLIV, and I believe it is section 8. It says, essentially, that in a conference you cannot put in new language that was not part of that conference and which is targeting direct spending for the purpose of benefitting some defined group--in this case, for the purpose of passing the cash for clunkers bill. You cannot put it in. The rule says that. Why was it created? Because too often around here, this type of mismanagement of our finances occurs. People go into a conference and they know they have a train that is going to leave the station and, in this case, everybody wants to support the troops in the field and we are going to fund them. So they put in the conference all sorts of extraneous things that are inappropriate to that bill. It has become a pandemic. The Democratic leadership, much to their credit, passed the Honest Leadership and Open Government Act. They put in rule XLIV, section 8, which says that exactly what happened with this language should not happen. I congratulate the chairman of the committee, Senator Inouye, because he has resisted, aggressively, allowing this type of action to occur. But in this case, the House of Representatives gave him no option. They put the language in over, I presume, some debate. So this motion will knock out this language. It doesn't defeat the bill. The bill can be sent back to the House and it can pass. It would take another couple hours, at the most, to pass it. If people want to bring back the cash for clunkers bill, they can do it as a freestanding bill and, hopefully, they can do it by paying for it. That is the way it should be done. It violates another rule, which is the pay-go rule. So this motion to waive is going to be the first test of this Congress on three critical issues. First, are we going to do something about the debt of this Nation? Are we going to start paying for new programs that we know are politically attractive? Every auto dealer in America wants this language included in the bill. Are we going to pay for it? Second, are we going to live by the rules that were put into place by the Democratic leadership in the Honest Leadership and Open Government Act? Third, are we going to live by the statement made by the President, surrounded by the Democratic leadership of the Congress, that pay-go would be the new way we will enforce fiscal discipline? Those are three major issues that will be addressed by this vote. Members who vote to waive this rule will be voting to pass a billion dollars of debt on to our children, on top of the trillions we are already putting on their backs. They will be voting to waive a rule that was put in by the Democratic leadership for the purpose of avoiding this type of action--this exact type of action. They will be voting to override the pay-go rules, which many Members have so wrapped themselves in as the way they are going to fiscally discipline this place. I hope people will not vote to waive this point of order, sustain this point of order, move forward on the supplemental, fund the troops; and let's not add a billion dollars of unnecessary debt on an extraneous program to the troop funding. I yield the floor, and at the appropriate time, I will yield to Senator Grassley such time as he may desire.

Mr. GREGG. Mr. President, first off, I appreciate the assistant majority leader clarifying the situation unalterably; that this waiver issue is solely about the issue of cash for clunkers--a piece of legislation which has absolutely nothing to do--nothing to do--with funding our troops in the field and was airdropped into a conference without being paid for, adding $1 billion of new debt to our children's backs. That is what this waiver is about. The majority leader has said this waiver will, in some way, harm the ability to fund the troops. I believe that to be totally inaccurate. This motion comes out of a piece of legislation which the majority leader and the assistant majority leader authored. They wrote the bill called the Honest Leadership and Open Government Act. That bill created this point of order specifically to address this type of situation, where in a conference one or the other of the two bodies sticks into a bill that is a must-pass bill language which has nothing to do with that bill and which is not paid for. In this case, it is $1 billion of spending not paid for which has nothing to do with the troops in the field. The reason they structured the rule this way was so it would not harm the underlying bill, so that if this point of order is successful, this bill goes back to the House and they can vote for it and send it to the President and fund the troops. Is it the position of the assistant leader that this cash for clunkers bill is so important that the House of Representatives would not fund the troops if the language was not in the bill? Is he saying the Democratic leadership of the House is holding the funding of the troops hostage to spending $1 billion on an extraneous program, which creates virtually no environmental improvement in our fleet and which is simply part of the economic effort to revive the auto industry-- which we have already spent $83 billion on, by the way. Is that what he is saying? That seemed to be the implication of his language: that the House will not pass the funding for the troops if we take it out of it--under a rule created for the purpose of disciplining ourselves this way, a rule created by the majority leader and by the assistant majority leader; authored by them and designed specifically to address this type of situation, where a conference is truly abused relative to funding and spending money which we do not have. I do not believe that is realistic. I do not believe the Democratic membership of the House is going to vote against this bill if the cash for clunkers language is taken out on a surgical strike under a procedural right which was created by the Democratic leader and the Democratic assistant leader. In addition, of course, there is the fact that pay-go is being violated. There is the great irony that the President of the United States, surrounded by the Democratic leadership of the Senate and the House, held a very dramatic press conference at the White House, at 12:30 in the afternoon, saying they were going to reestablish the pay- go rules for future spending, that new programs would have to be paid for. And then that House leadership went back up to Capitol Hill, and on the same day, passed this cash for clunkers bill, which was not paid for and violated the pay-go rules. The hypocrisy of it is so extraordinary that it cannot even be described. But that is what happened. And then, in order to protect this bill, which was an unpaid-for violation of the pay-go rules, they stuck it into the conference report to fund the troops. How outrageous is that? So a pay-go point of order, which might take down this whole bill, is not appropriate to make. But it is appropriate to make this very targeted point of order, which will only eliminate the cash for clunkers language. The policy of cash for clunkers is debatable. Maybe it makes sense; maybe it does not make sense. But it certainly should not have been put into this Defense bill, which is necessary for funding our troops. If it is a strong idea, let it stand on its own two feet on the floor of the Senate. Let it be debated. Let it, hopefully, be paid for. But at least let it be amended so those of us who think it should be paid for can propose ideas for paying for it. Under the bill as it is being handled now, there are no amendments allowed. We have to take this $1 billion of new debt, like it or not, whether we support the program or not. We have to pass a bill which is going to add this $1 billion of additional debt on our children's backs. It is a totally inappropriate way to legislate. My effort is not to slow down or to stop or to marginalize in any way the funding for our troops--I voted for every troop funding bill that has come through this Congress, and I intend to continue to vote for them--but it is to take out this language, which is inappropriate, to live by the rules the majority leader passed, the assistant majority leader put in place--rule XLIV--to live by the pay-go rules, to not, in the name of addressing a special interest group, spend $1 billion for which we will pass the bill on to our kids and our grandchildren. Why should our grandchildren have to pay for cars we are going to buy today? Does that make any sense, that for the next 20 years we are going to end up paying these bills? Of course, it does not make sense. So we should take this language out. It is not going to slow this bill down, not at all. This bill will go back to the House. It will be passed, and it will be sent to the President. It will be an act of fiscal responsibility, and we will be limiting the amount of debt we will be putting on our children's backs, which is the way we should be approaching legislation. Mr. President, I reserve the remainder of my time. How much time is there available?

Mr. GREGG. Mr. President, how much time does the Senator from Oklahoma wish to have?

Mr. GREGG. Well, Mr. President, I will reserve the remainder of my time. I see the Senator from Michigan on the floor.

Mr. GREGG. Mr. President, how much time remains?

Mr. GREGG. And on the other side?

Mr. GREGG. Mr. President, I am going to yield to the Senator from Oklahoma, but before I do, I wish to take just 30 seconds to respond quickly to the Senator from Michigan. The idea that we haven't done anything for the automobile industry is really hard to accept, $83 billion having been spent on the automobile industry. The idea that $1 billion is just a small amount of money is also very hard to accept; $1 billion of new debt is $1 billion that our children are going to have to pay, and it is not a small amount of money, and it compounds. We fly in the face of the procedures which the Democratic leader set up around here to have pay-go and to have the Open and Honest Leadership Act, we fly in the face of that by putting in this bill this special interest piece of legislation, unpaid for, and it is totally inexcusable. This has nothing to do with funding the troops--nothing. The fact that $1 billion is being spent and not paid for is totally irresponsible. It is debt our children do not need to receive. At this point, I yield 10 minutes to the Senator from Oklahoma.

Mr. GREGG. Mr. President, I understand the chairman wishes to close, so I will just speak and then yield back the remainder of our time, and so the chairman can make his closing comments. I just have to reemphasize how much of an afront it is to the process which we set up at the beginning of this Congress to try to have fiscal discipline if we do not support this point of order. This point of order was specifically put in to address this type of situation, where there is an extraneous piece of legislation airdropped into a conference report by one House or the other House, and in this case, it is $1 billion of spending which will go directly to the debt of this country. We have heard from the Chinese that they are getting worried about buying our debt. They are the ones who are financing us. We have heard from our own experts and economists that the American debt rating, which is AAA-plus, may be at risk. We know we are running up debt at such an extraordinary rate right now--$2 trillion this year, over $1 trillion next year, $1 trillion a year on average for the next 10 years--that our debt is going to double in 5 years and triple in 10 years. Where do we start to discipline ourselves? Well, one would hope we would start to discipline ourselves with something that so obviously violates the rules we set up here for fiscal discipline. It violates pay-go. It is not paid for, even though the President calls for pay-go. This is a new program, unpaid for, and it violates the new rule put in under the Openness in Government and Honesty in Leadership Act, authored by Senators Reid and Durbin, and Senator Stabenow was a cosponsor. It said don't put into a conference report things that are extraneous and aren't paid for. Yet this does exactly that. Will it affect the troops in the field? No. This bill will pass now. If this point of order is sustained, this bill will pass this House and fully fund the troops. Then it will go back to the House of Representatives. I cannot believe, under any scenario, that the House of Representatives is not going to vote to fund the troops, that they are going to hold the funding of the troops in the field hostage to spending $1 billion and adding new debt on an extraneous program that has to do with buying old cars. Nobody is going to do that. That doesn't even pass the smell test as being credible. The bill will pass the House and be sent to the President probably before the day is out. That is the way it should be. That is why this point of order was put into place. That is why the Senator from Illinois, working with the Senator from Nevada, the leaders on the other side of the aisle, created this very good and appropriate rule, so things like this could be addressed in a surgical way, so they would not lead to adding $1 billion--in this case--which is a lot of money. A couple of Members have said it is just a little bit. In New Hampshire, $1 billion will run our State government for a considerable period of time. That is a lot of money. I have never seen it. It is a lot of money. There is no reason to pass on to these young pages that debt. If we think the cash for clunkers idea is a good one, let's pay for it. There are a lot of places we can find $1 billion in a $2 trillion-plus budget. So let's pay for this. Let's budget effectively. Remember the words of the chairman of the Budget Committee because they are prophetic: The debt is a threat. It is a threat to this Nation. We have a chance to do a little bit--$1 billion worth, which is a significant amount--to try to address the debt problem by supporting this point of order.

Mr. GREGG. Mr. President, I ask for the yeas and nays.

Mr. GREGG

Mr. GREGG. Madam President, we are now, then, on the conference report?

Mr. GREGG

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

Mr. GREGG. Mr. President, I ask unanimous consent to speak as in morning business.

Mr. GREGG. Mr. President, we are, as a nation, facing an incredibly severe fiscal situation, not only in the short term but in the long term. The debt of this country is piling up at astronomical rates. We will, this year, have a deficit that comes close to $2 trillion--$2 trillion--or 28 percent of our gross national product. We are talking about a deficit next year of well over $1 trillion. Under the budget sent to us by the President and approved by this Congress--not with my support or many Republicans--I don't think any Republicans supported it--the deficit will run at $1 trillion a year for as far as the eye can see. The debt of this country will double in 5 years. It will triple in 10 years. Deficits are running at 4 to 5 percent of GDP--not only immediately after we get past this recessionary period--for, again, the next 10 years. And the debt-to-GDP ratio, which is a test of how viable a nation is, will jump to 80 percent. Those are numbers which are not sustainable. Everybody admits they are not sustainable. In fact, they are numbers that are so devastatingly large and so unmanageable for our Nation that were we trying to get into the Europe Union, we wouldn't be allowed in. That is how irresponsible our deficit and our debt is. They are numbers which will lead us as a nation to lose the value of our dollar--the value of our currency--and our ability to finance our debt. In fact, we are already seeing signs to that effect. The leadership of the Chinese financial systems have made a number of statements which basically have said they would not necessarily forever rely on American Treasury notes and purchase our notes. And they are financing us right now. The country of Great Britain, which is considered to be the second most stable country in the world, has received a notice from Standard & Poor's that its debt will not necessarily be downgraded, but it is being taken to negative status. A leading economist and reviewer of the bond issues of the United States, as recently as today, has announced that our triple A rating--triple-A-plus rating, which is the best in the world--is at risk because of this massive explosion in debt. To quote Senator Conrad, the chairman of the Budget Committee--a person I greatly admire on issues of fiscal policy--the debt is the threat, and it is. It is a threat to our Nation, it is a threat to our young people because they will inherit this massive obligation to pay for costs which are being expended today. There are a lot of reasons why the debt is going up radically. Primarily, though, it is spending. It is quite simply spending. The spending of the Federal Government will jump from the traditional level of about 20 percent of GDP, which it has been at now for 40 years, to 25 to 26 percent of GDP under President Obama's proposal. In the short run, obviously, revenues are a factor because we are in a recessionary period. But in the long run, what is driving the deficit, what is driving this massive increase of debt, which will be unsustainable, is spending. Well, the Congress has a chance, in the next couple days, to do a small but significant part in the way of a public statement and in the way of a statement of policy that we are concerned about the debt. We have a chance to do something. This administration has a chance to do something. As of today, five banks have repaid large amounts of their TARP funds. It is estimated we are going to get about $65 billion of TARP payments back. In other words, the way the TARP worked during the crisis, which almost led to a fiscal meltdown--the government stepped forward and purchased preferred stock from a variety of major banks in this country. That preferred stock paid dividends to the taxpayers. It was an asset, and it was a good decision. It stabilized the financial industry. The TARP funds kept us from going over the precipice, kept us from an economic meltdown of catastrophic proportions, and saved Main Street. People on Main Street probably don't appreciate it that much, but essentially that decision saved folks' homes, their ability to borrow, to go to school, their ability to borrow to start their business, to meet their payroll, and basically operate as a typical economy. The idea always was that the TARP money would come back to the Federal Treasury, the $700 billion worth of TARP money that was authorized would come back after the financial situation stabilized. Well, now we are starting to see it come back in the first tranche--$65 billion plus about $4.5 billion of interest. That is pretty good. We made $4.5 billion in interest--in less than 4 months, by the way. The taxpayers did pretty well on this. So what are we going to do with that money? Well, I suggest--and the law actually states--what should be done with that money. We should pay down the debt. That is a good way to use this money. The other option is the Treasury can simply hold on to it in anticipation of, potentially, another crisis. But that is not necessary. The Treasury still has a line of credit under TARP which reaches $50 billion to $75 billion, depending on how you account for it. We know the risks out in the marketplace right now are nowhere near that number, and they are certainly not systemic. Therefore, these TARP dollars are not needed. They are not needed right now or in the foreseeable future for the purposes of maintaining financial stability and avoiding a systemic meltdown. So it is totally appropriate that all that money be used to pay down the debt, or at least a significant portion. It would be an extraordinarily positive statement by this administration if they said to the markets and to the American people: The responsible thing to do is to take this money and pay down the debt. I think the market would react positively immediately. They would say we are serious. I think the American people would react positively immediately too. It would be a huge win for this President--the policy worked. This President and the prior President, President Bush and President Obama, had the courage to step up in the face of fairly significant headwinds and make the decision to use the TARP money in this way. Now it has worked, they should use it to pay down the debt and get the double win of having been able to say what we did was good policy, it was not popular policy but it was good policy, it worked to stabilize the financial institutions, and what we are doing now to pay down the debt is also good policy and it is what the law calls for in the end. That is the first thing that could happen right now, and it should happen. This money that was paid in today to the Treasury should be used immediately to pay down the debt, and that should be announced by the Treasury--or if I were President, I would announce it myself; it is pretty good news. So that is a step in the right direction. Granted, on a $2 trillion deficit, it is not massive, but it is a statement, and a statement is important at this time. And you know, $68 billion is a lot of money anyway, so it would be a good decision. The second thing we should do, and we can do, is not allow the war supplemental--which is an important piece of legislation needed to fund our troops--to be used as a passenger train for unfunded baggage which will pass debt on to our children on extraneous issues. That is what it is being used for. Last week, the President held a press conference at the White House surrounded by the Democratic leadership of the Congress, and he said we are going to return to pay-go, we are going to require that new programs be paid for. I applaud that as an attitude and approach. It has not been followed around here, but I applaud the fact that he stated that and he had standing behind him the Democratic leadership of this Congress when he said that. Ironically, on the same day, I believe, the House of Representatives passed a bill which increased spending by $1 billion which had nothing to do with the war, which was not paid for. Therefore, it did not meet pay-go but instead created a debt our children will have to pay. They stuck that legislation in the war fighting bill so it could not be amended and paid for or amended and improved. It is called the Cash for Clunkers, and it is a clunker of a bill because it passes on to our children a $1 billion price. It is $1 billion of new debt. Why would we do that? Cash for Clunkers may be a program that is good. Maybe it is a reasonable idea to pay for old cars to get them off the road, to put new cars on the road, hopefully to increase mileage of the auto fleet and also to stimulate the economy. That may be a good idea, but it is not a good idea to not pay for that. We have already spent $740 billion on the stimulus package, unpaid for. We have spent $83 billion on the automobile buyouts, on the automobile bailout-- unpaid for. Now to put this extra $1 billion on top of all that just adds insult to injury to the next generation and our children's children who will have to pay the price for this. Why should our children and our grandchildren have to pay the bill for us paying $3,500 to somebody to buy their car today? How fiscally irresponsible is that? It is especially fiscally irresponsible when you realize it is done in the context and on the same day, I believe, as the President announcing that we are going to go back to pay-go principles around here where we actually pay for new programs we put on the books. But in order to avoid that, in order to avoid what they had just signed onto, the congressional Democratic leadership down at the White House, standing behind the President and cheering when he said we are going back to pay-go, stuck this language in the war supplemental. That is an insult to our troops. In order to fund our troops, they have to take along with them $1 billion of new debt, passed on to their children. Many of these extraordinary people who are fighting for us have children. Is it right that in order to get them the adequate resources they need to fight this war, we should send their children a bill for $1 billion so we get a public policy that we can go back to our automobile dealers with and say: Hurray, we got you this $1 billion of spending. Of course not. That is not right, it is not fair, it is not appropriate. Okay, Cash for Clunkers may make sense if it is paid for. The way it was structured, it cannot be paid for. You cannot amend this bill in its present form, and therefore, if it passes with the Cash for Clunkers in it, a $1 billion price tag in it, we basically pass that debt on to our children. I will at the appropriate time offer an amendment which will essentially be a pay-go amendment. It will be a point of order that says essentially--it will not be under pay-go because if I did that it might bring the whole bill down and I have no interest in bringing the whole bill down--it will be a targeted point of order which will essentially be a pay-go point of order. Anybody voting against this point of order will be voting against pay-go, which will say this language, which is unpaid for, this $1 billion, should not stay in this bill in this form. Does that mean this bill goes down? No. You will hear a lot of moaning going around saying this will destroy the bill. No, it will not. This bill can be sent back to the House and passed without the Cash for Clunkers language in it, unpaid for, or it could be sent back to the House and they can put back in the Cash for Clunkers language, paid for. It can all happen within about a 6-hour day, 6-hour legislative day, maybe even less. Maybe even a half hour, knowing the rapidity of the Rules Committee in the House. It seems this will be one of the first tests of whether we as a Congress mean what we say. Do we mean that when we say we are not going to create a new program that we are not going to pay for, we actually will stand behind those words? This should be an easy one for us because this plan can be paid for rather easily by moving money around in the original stimulus package. It is fairly obvious this plan should not be in the war supplemental to begin with, but if it is going to be in the war supplemental, it should not be in the form that passes massive debt on to our children. It is a chance to make a $1 billion statement that we are going to start getting serious about the debt around here. I hope I will be joined in this point of order by my colleagues who are interested in the integrity of the pay-go process and in not passing on to our kids a $1 billion bill they do not deserve. I make a point of order that a quorum is not present and yield the floor.

Mr. GREGG

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

Mr. GREGG

Mr. GREGG. Mr. President, I rise today to speak briefly about two issues, and I know Senator Burr wants to continue his discussion of the FDA tobacco bill. There are two issues which are very significant to the American taxpayer, especially to those of us who are concerned about how much debt this administration is running up on our children, and they need to be highlighted. The first is good news. It looks as though a number of banks are going to repay a fair percentage of the TARP money that has been put out by the administration--potentially $65 billion. When TARP was originally structured, the understanding was that we would buy assets in banks or from banks, and at some point we would get that money back as taxpayers. In fact, we would get it back with interest. This is what is happening now. The money is coming back, as these banks have restored their fiscal strength, and it is actually coming back with interest. About $4.5 billion on top of the money we have put out, is my understanding, as to what will be paid back on the interest side relative to the preferred stock. So that is all good news. First, the financial system was stabilized during a cataclysmic period in September and October, and the investments which remained in preferred stock, with taxpayers' money, is now being repaid. The issue becomes, however, what are we going to do with this money that is coming back into the Treasury? Well, it ought to go to reduce the debt. This administration in recent days has been giving at least lipservice to the fact that the budget they put in place, with a $1 trillion deficit over the next 10 years on average every year--$1 trillion every year for the next 10 years, of doubling the debt in 5 years, of tripling it in 10 years--they have been giving lipservice that they understand that is not a sustainable situation. The Secretary of the Treasury, the Chief Economic Counsel, and even the President have said the budget they proposed is not sustainable because the debt that is being run up on the American public cannot be afforded by our children. It goes from what has historically been about 35 percent of the gross national product up to over 82 percent of the gross national product. The interest on the debt alone at the end of this budget which the President proposed will be $800 billion a year--$800 billion a year--just in interest payments that the American people will have to pay. That will actually exceed any other major item of discretionary spending in the budget. We will be spending less than that on the national defense. We will be spending more on interest, in other words, than we spend on national defense because of all of the debt that is being run up. Well, if this administration is serious--and I am not sure they are; I think they are basically holding press conferences because they did something else today which implies that--if they are actually serious about trying to address this debt issue, then they should immediately take the $65 billion they are going to get back from the banks to which money was lent and that was put out by taxpayers and knew we would get back, they should immediately take that money and apply it to reducing the Federal debt. It should not be spent on other programs. It shouldn't even be recycled through the financial system. It should be repaid to the taxpayer by reducing the debt of the United States. That is the only reasonable way to approach it. It would be a tremendously strong signal not only to the American taxpayers that this administration is serious about doing something on the debt side, but it would be a strong signal to the world markets that we were willing, as a nation, to take this money and pay down the debt. Ironically, it would also follow the proposal of the original TARP bill, which said that after the financial system was stabilized, any moneys coming in should be used to reduce the deficit and debt of the United States. It certainly should not be used to fund new ventures into the private sector, whether it is buying automobile companies or insurance companies or anything else such as that. It should be simply used to reduce the debt. I hope the administration will do that because that would follow the law, and it would be a good sign to the world markets, which are becoming suspicious of our debt, as we have seen in a number of instances--for example, the cost of 10-year bills, 30-year bills, and also the fact that the Chinese leadership, in the financial area, expressed concern about the purchase of the long-term debt of the United States. It would also be a positive sign to Americans that we are going to do something about this debt we are passing on to our kids. It is unfair to run up a trillion dollars a year of deficit, double the debt in 5 years, and triple it in 10 years, and send all those bills to our kids. These young students here today as pages, in 10 years, will find the household they are living in has a new $30,000 mortgage on it, and it is called the bill for the Federal debt. They will have a new $6,500 interest payment that they will have to make, which is called the interest they have to support on the Federal debt. It is not appropriate to do that to these younger Americans and to the next generation. Let's take the $65 billion and use it as it was originally agreed it would be used, which is when it came back into the Treasury, with interest, which is pretty good, it would be used to pay down the debt. Why am I suspicious that this administration is giving us lip service on the issue of fiscal discipline? There is a second thing that happened today. The President today came out and held a big press conference about how he was for pay-go. I have not heard a Democratic candidate for Congress, and now the President of the United States, not claim they are going to exercise fiscal discipline here by being for pay-go, because the term has such motherhood implications, that you are going to pay for what you do here. It is total hypocrisy, inconsistent with everything that has happened from the other side of the aisle in the era of spending and budgeting. Not only do they not support pay-go, they punch holes in what we have for our pay-go law. In the last 2\1/2\ years, this Congress--and now in the last 3, 4, or 5 months--and this Presidency have passed--democratically controlled-- 10 bills that have waived or gamed the pay-go rules that are already on the books to the tune of $882 billion. If you throw in the things they wanted to do that they weren't able to pass, because we on our side stood up and said, no, that is too much--and we did it on the rest, but we got rolled--it is over a trillion dollars of instances where this Congress and this President have asked for initiatives that would waive, punch holes in, go around the pay-go rules we already have. That is why I called it ``Swiss-cheese-go,'' not pay-go. Now we have this disingenuous statement from the administration that suddenly they are for pay-go. It already exists; we just don't enforce it around here. Not only do they claim they are for pay-go, even in their statement they claim they are for it, and they game their own pay-go proposal by saying it is not going to apply to the doc fix, the AMT fix, or even to the health care exercise. There should be a pay-go point of order against the first 5 years, and they waived that on health care reform. It is a good precedent. It will be picked up by the mainstream media as an effort by this administration to try to discipline spending because, of course, they are not going to acknowledge that it has been gamed to such an extraordinary extent that over $882 billion has been spent that should have been subject to pay-go rules. So it is a touch inconsistent and disingenuous for them to suddenly now find the faith of pay-go when, in fact, they have been ignoring pay-go rules and gaming those rules so they could spend money. Again, what happens there? They run up the debt on the American people in the United States, creating a system where our government will not be sustainable or affordable for our children. If this administration wants to do something meaningful in the area of reducing the debt and controlling spending, take the $65 billion they are about to get in repayment of TARP money from the various banks and apply it to reduce the debt. That would be real action versus the precedent. I yield the floor and appreciate the courtesy of the Senator from North Carolina.

Mr. GREGG

Mr. GREGG. Mr. President, I rise today to return to a topic I have discussed on the floor a number of times but which I think needs to be discussed again because of the severity of its implications for our Nation; that is, the massive amount of debt which we are running up in our country. This massive expansion of our debt, at levels which we have never seen in our history, as proposed by the President's budget and the budget which passed this Congress, threatens the value of the dollar. It threatens to create instability through massive inflation. And it clearly threatens the future of our children. I am not the only one who thinks this way. As you look around the world, there are a lot of folks taking a look at where we as a nation are going and asking the question: Can we afford this debt as a country? Interestingly, just a week and a half ago or so, Standard & Poor's, the rating agency, looked at the English situation and put out a statement that the triple A bond rating of England was in jeopardy. They essentially took the adjective ``stable'' out from their designation of that bond rating and said they had a negative bias on the triple A rating. They did not reduce it, but they did put out a major warning sign. What does that mean? Well, if your bond rating as a nation drops, that means the world community does not have a lot of confidence in your ability to repay your debt and it is going to charge you a lot more to lend you money. The effect of a bond rating change for a nation such as the United Kingdom--which is one of the most stable and industrialized countries in the world--is catastrophic. What brought about this decision by Standard & Poor's to put, at least on a watch list, so to say, the bonds of the United Kingdom? It is the fact that England has so expanded its debt that its debt now represents approximately 52 percent of its gross national product. Well, where do we stand as a nation in our debt relative to our gross national product? This chart reflects the fact that historically, in the last 30 or 40 years, our debt has averaged between 30 percent and 40 percent of GDP, but in this economic downturn, we are seeing a dramatic increase in our debt as a nation. In the short run, I have said many times, we can tolerate this for the purpose of trying to float the economy, for the purpose of the government being the lender of last resort, for the purpose of stabilizing the financial systems. A short-term, huge spike in our debt is not desired, but it can be managed. We have done this in the past. During World War II, for example, our debt went up dramatically. But the key is, it has to come back down. It just can't keep going up. Well, today, our debt is about 57 percent of our gross national product, our public debt. It is up around here on the chart. As we see from this line, under the budget proposed by President Obama, it continues to go up, almost in a perpendicular manner, to the point where, by the end of the budget as proposed by the President and as passed by this Congress, the public debt will be approximately 82 percent of gross national product. That is not a sustainable situation. Over the next 10 years, under the budget as proposed by the President, we will be running deficits which represent $1 trillion a year, on average--$1 trillion a year, on average. As a percentage of our gross national product, those deficits will be between 4 percent and 5 percent. As I have said before on this floor, you can't get into the European Union if your deficit exceeds 3 percent of your gross national product and your debt exceeds 60 percent of your gross national product. These are all big numbers and nobody can catch up with those numbers, but the basic implication is very simple. Under the present path we are on, the debt is going to double in 5 years, triple in 10 years, and the implications to our children are that they are going to inherit a country where the payments required on that debt are going to be the single largest item of the Federal Government--$800 billion a year which will have to be paid in just interest. For every American, they will receive $130,000 of debt--every American household will have $130,000 of debt on that household to pay off the Federal responsibility--and $65,000 in interest payments annually for every American household. That is more than many American households' mortgages and more than their interest payments on their mortgages, but that is what every American household is going to owe as a result of this dramatic expansion in debt. What is driving this debt? Well, in the short term, obviously, it is the economic downturn. But we are not going to be in this economic downturn forever. Everybody is presuming we are starting to move out of it, and we will because we are a resilient nation. In the outyears, what is driving this debt is spending--it is that simple--new, additional spending put on the books or planned to be put on the books under this budget. This blue line here, which flattens out where the debt stabilizes over the next 5 years, is if we had current law. In other words, if the law that was in place before the President's budget was passed were to take effect and stay in place, that is the blue line. That is what the debt would do; it would stabilize. But because the President has proposed so much new spending in addition to the spending that is going to come as a result of the retirement of the baby boom generation and the expansion of entitlements, this debt just continues up in an astronomical way. This is a real concern for us. I recognize it is hard for a Congress to deal with anything but the next election--and what we are talking about here is really what we are doing to the next generation--but we should be very concerned--more than concerned, we should be really focused on this as our primary issue of domestic policy as we go forward as being a threat to our prosperity as a nation. What are other governments saying? Well, China, which is our biggest creditor--we financed this debt by lending from China. They give us money to spend on our operations as a government. They have always looked on the U.S. debt as something that was a good investment, a safe investment, but the Chinese are having second thoughts. In an extraordinarily embarrassing incident, the Secretary of the Treasury, speaking before an audience of sophisticated college students in Beijing, was asked about the status of our debt that is held by the Chinese. He told them that Chinese assets are very safe, and the audience laughed. The audience actually laughed at the Secretary of the Treasury saying that Chinese assets are very safe. That is an anecdotal incident, but it would never have happened 6 months ago, 2 years ago, because these types of increases in debt as a percentage of our economy were nowhere in sight then--nowhere in sight. Then Mr. Yu, who is the former adviser to the Central Bank, made the following statement just a couple of days ago. He said: The United States Government should not be complacent and it should understand that there are alternatives to China buying U.S. bonds and bills. Investments in Euros are an alternative, and there are lots of raw materials we can buy too. China should not close those options. Well, if the Chinese Government starts to reduce its purchase of our bonds and our need to sell bonds is going up, what happens? That means the interest on the bonds is going to have to go up because we are going to have to find somebody who wants to buy these bonds and we are going to have to make them attractive around the world. As the interest on the bonds goes up, taxpayers end up having to bear that burden and the next generation ends up having to bear that burden. So what is the solution? How do we get around the fact that we are now on an unsustainable course which will lead to a fiscal calamity for our Nation and potentially put us in the position where we will have to devalue the dollar or have massive inflation? Interestingly enough, the Economic Information Daily, another Chinese publication, hit the nail right on the head. Maybe because they are looking from the outside in and because of all they have invested they can see these things, because they said the question that should be asked of Secretary Geithner is, How do you propose implementing fiscal discipline? How will you maintain the stability of the dollar after the crisis--and I emphasize ``after.'' What they are saying is, after we get past this recession and the need to stabilize the financial structure of our country and the need to float the economy, how do we bend this curve back to something reasonable and sustainable? That is the question we should be asking around here as a Congress. We need to start asking it pretty soon. The President has said--he said it again yesterday--that one way you do this is by addressing the cost of health care, and he is absolutely right. Health care is the primary driver--one of the primary drivers-- of this massive increase in expenditures at the Federal level. But the President has put nothing on the table so far that bends the curve on the question of the cost of health care--in fact, just the opposite. His budget proposed that health care spending would go up $1.2 trillion over the next 10 years and, more importantly than that, it sets up a series of entitlements which will cost hundreds of billions--as I said, $1.6 trillion in new spending. He is suggesting that instead of keeping health care spending at about 17 percent of gross national product, which is a huge amount of money, by the way, more than any other industrialized country spends by almost 50 percent--the next closest country spends about 11 percent on health care--he is suggesting that instead of maintaining health care costs at 17 percent of gross national product, it be allowed to rise to 18, 19, and 20 percent of gross national product. Well, we can't afford that. We can't afford that. What we need in the area of health care is to address the issue that the President said, which is to control the costs of health care, not by expanding the size of the costs of health care but by using the dollars in the health system more effectively and by getting better quality at lower costs, which can be done, by the way. There are a lot of proposals for doing exactly that. But one of them isn't to create a single-payer plan or a public plan which essentially puts the government in charge of health care and, as a result, drives up the cost of health care significantly and drives the spending up and the borrowing up that goes with it. So, yes, we have to address it, but we have to address it in a way that actually controls spending, controls the rate of growth in spending and health care, and that doesn't aggravate this additional debt. It is hard to understate the significance of the threat this debt represents. It is hard to understate it. I know I have spoken on this floor about it a number of times, but that is because it is so critical to our future as a nation. We literally are bankrupting the futures of our children by putting this much debt on their backs, by doubling the national debt in 5 years and tripling it in 10 years. I am beginning to feel a little bit like Cato the Elder, who used to speak in the Roman Senate and begin and end every speech with ``Carthago delenda est.'' Finally, somebody listened to him, and they actually did destroy Carthage. Well, I am saying let's get the debt under control. Let's control the spending of this government. Let's do something about this outyear spending before we get to a position where the world loses confidence in our dollar, loses confidence in our debt, before we get into the position where we have to inflate the economy or we have to place taxes on our children that are so high that they have no chance to have as prosperous and as competitive a life as we have had. It is not fair, as I have said before, for one generation to create this type of debt and pass it on to the next generation to pay. It is not fair. It is not right. It is something we have never done as a nation. Whenever we have run up debt significantly like this, we have always paid it down on an equally quick basis. After World War II, when our debt got to over 100 percent of GDP, we brought it down very quickly. We need to bring it down today. We need to have discipline around here that leads to getting the debt of this Nation back to a responsible level, which means something under 50 percent, hopefully closer to the historic norm of 40 percent; where we get the deficits back to a responsible level, which means under 3 percent, hopefully even headed toward balance; and where we can tell our children that we are passing on to them a stronger nation, not a weaker nation, a more prosperous nation, not a nation confronting massive inflation, leading to the devalue of the dollar or massive tax increases. Mr. President, I yield the floor and make the point of order that a quorum is not present.

Mr. GREGG

Mr. GREGG. Mr. President, I ask unanimous consent to speak as in morning business.