WASHINGTON, D.C. (12/14/11) – This afternoon, Sen. Rand Paul took to the Senate floor urging his fellow colleagues to rein in Washington’s out-of-control spending by adding a Balanced Budget Amendment to the Constitution. Tomorrow, Wednesday, Dec. 14, the Senate is scheduled to vote on a Balanced Budget Amendment (S.J. Res 10), which is supported by all Republicans, and a Democrat-proposed alternative (S.J. Res. 24), which fails to balance the budget.
The following is the transcript of Sen. Paul’s statement…
I rise today in support of the Balanced Budget Amendment. In fact, it’s beyond me to imagine that anybody in this body could oppose a Balanced Budget Amendment. I ran my election last year primarily on this fact, that government spending was out of control and that debt was consuming our country and that we needed new and more serious rules to bring our budget into control.
We’ve tried in the past. This body passed Gramm-Rudman-Hollings with bipartisan support in the ‘90s and immediately began to evade it. This body passed “pay-as-you-go” and then proceeded to disobey their own rules 700 times.
We wonder why 9 percent of the people approve of Congress. It’s because we cannot even obey our own rules. We need new rules. We need a Balanced Budget Amendment that would be an amendment to the Constitution because we do not adhere to the rules that we pass. This body is literally out-of-control.
Now, the other side says, trust us. Trust us. We can balance the budget. This other side hasn’t even passed any budget this year or last year, not just a balanced budget, the other side can’t pass any budget.
So I think we really do need new and stronger rules to force us to do what is right, what every American family has to do and that’s balance your family budget. A nation is no different. A nation has a printing press and can run deficits for longer, but there are ramifications.
The enormous debt we’re accumulating as a country, we’re borrowing $40,000 every second. During the time of my five-second speech, we will borrow millions of dollars. There are ramifications.
What happens is you have to pay for your debt in some way. You can either tax people or you can borrow. We’re at the limits of both. Or you can simply print the money. But as you print money to pay for your debt, you destroy the value of the existing currency. So those who have savings, those who are on fixed incomes, senior citizens, the working class who every penny of their paycheck goes to their needs, they are being robbed by inflation and inflation is the end result of debt.
If you look at the approval of Congress being 9 percent and you contrast that with how much of the public is for a balanced budget, 75 percent of the public -- Republicans, Democrats, and independents -- would vote in favor of a Balanced Budget Amendment.
But this body sought of touch because we can’t get anybody from the other side even to talk to us about a Balanced Budget Amendment. We worked for months to see what is it that would make it accept to believe the other side. We got nowhere. We need to balance our budget because the debt is a threat to our country.
This is not just me saying this. The chairman of the Federal Reserve has said that our debt is unsustainable. Admiral Mullen, part of this Administration, has said that our debt is the greatest threat to our national security. Erskine Bowles, who led the deficit commission and has been known as a Democrat, said that, “We are approaching the most predictable crisis in history and it will be a debt crisis.”
All throughout Europe there is a debt crisis. Italy is having trouble paying its debt. Greece is under water. Portugal, Spain, Ireland are all tenuously holding on and trying to pay their debt. That European crisis, that destruction of the Euro, is coming this way. Our debt now equals our economy.
Senator Hatch mentioned we’ve a $15 trillion debt and a $15 trillion economy. Many economists say when your debt approaches 100 percent of your GDP -- where ours is now -- that you’re losing 1 million jobs a year. It is having a drain on the here and now. It is not just this debt is being passed to our kids and our grandkids. The debt is affecting jobs.
When I talk to college kids, I say the chance of you getting a job depends on what we do with our debt. If we continue to finance our spending through debt, you will not have a job. You will have less likelihood of getting a job.
Now some say it would be too hard to balance the budget. It is just too far out of whack, we can’t do it. It is pretty bad. We are borrowing 40 cents on every dollar. If you look at the spending, borrowing 40 cents on every dollar is a remarkable thing.
Our budget, what comes in in revenue is being consumed by entitlements and interest. Everything else we spend up here -- national defense, roads, everything else -- the rest of the 40 percent of the budget is being borrowed. It is out of control. Can you imagine any business or any family in this country borrowing 40 percent every year, year on after year? It can’t be done. There are ramifications and a day of reckoning is coming.
But some say, how could we ever balance our budget? I’ll tell you how. If you cut 1 percent of spending -- this is called the Penny Plan -- cut one penny out of every dollar in federal spending for six years and freeze spending for 2 years, the budget will balance in eight years.
If we were to pass a Balanced Budget Amendment and send it to states, there is a five-year window it in the amendment plus it takes a couple of years to pass it would be about eight years.
So you could balance it in eight years simply by putting one penny out of every dollar. Well you say how can that be? They’re cutting trillions of dollars and not balancing the budget. The reason is when they talk about cutting spending around here; they’re always talking about cutting proposed increases in spending. They’re never talking about real cuts in spending.
What I’m talking about is a real cut. We spend $3.8 trillion in our budget this year. One percent is $38 billion. Next year we spend $3.8 trillion minus $38 billion. A real cut of 1 percent each year for six years balances our budget in eight. It could happen but it will take some resolve. But people need to understand the alternative. The alternative if we do nothing, our debt is going to consume us as a nation.
We’ve been warning about this for some time. Sen. Hatch has been active. The last time we voted on this was in 1997. Fourteen years later we’ve had a significant revolution at the polls and the people are anxious to say do something and protect us from this mountain of debt. Yet there’s still great resistance in this body.
But I would say that the people in this body, who vote against the balanced budget, do it at their own peril and do it against the will of the people. If they think it is so important to continue to accumulate debt and that debt is fine, vote against this amendment; but you’re thumbing your nose at the people. You’re thumbing your nose at the American people who are very worried about our republic and worried about this debt.
So, Mr. President, I rise today in support of the Balanced Budget Amendment and even encourage my colleagues to give serious thought to voting for this amendment.
Information provided by Moira Bagley
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