CongressCritter Price and the Debt Ceiling

Dear CongressCritter Price

I did not write to you to solicit your view on the debt ceiling…

I gave you a specific instruction: DO NOT RAISE THE DEBT CEILING.

Do not lie to me by implication. “Default” is a threat that Obama and some in Congress are making to avoid spending cuts.

The only way a default would happen is if YOU choose to not pay the interest on existing debt from current revenues.

You are accountable for payment of that debt and for the consequences of your actions in office.




From: Congressman David Price

Sent: Friday, July 22, 2011 4:56 PM

Subject: Reply from Congressman David Price

July 22, 2011

Dear :

Thank you for contacting me about the ongoing debate surrounding the debt ceiling. It is good to hear from you, and I appreciate the opportunity to explain my views on this complex issue.

First, it is important in this debate to recognize that raising the debt limit is not about the size of any deficits we might incur in the future; that will depend on separate decisions about spending and revenue levels. The debt limit is mainly about paying money we already owe. There should be no question that our country pays its bills; that is why I voted for a “clean” debt limit increase bill weeks ago, without extraneous provisions in order to avoid the political brinksmanship some are engaging in now. Raising the debt limit is not a partisan issue — since 1940, Presidents, both Republicans and Democrats, have raised the debt ceiling over 70 times. During the Reagan Administration, the debt limit was raised 16 times.

Time is running out. If the federal debt limit is not raised by August 2nd and our government is forced to default on its debt, the consequences will be severe and felt by every American. One critical effect of a default is that the cost of borrowing will rise for the federal government and the ripple effect will raise the cost of credit for everyone else — small businesses, families, farmers, and state and local governments. If foreign investors, who hold a large percentage of our national debt, decide that the U.S. government is not the safest place to lend money to, it could have a long-lasting negative impact on our economy.

I also believe it is essential to address our country’s long-term fiscal situation, apart from debt-limit posturing. Looking back, the budget surpluses we achieved during the 1990s were the result of a concerted effort to balance the budget through a comprehensive approach. Revenues, entitlements, military and domestic spending — all were on the table. We balanced the budget four years in a row, and paid off more than $400 billion of the national debt. Unfortunately, this positive momentum was reversed under the Bush administration through trillions in tax cuts, two wars, and a privatized prescription drug plan — none of it paid for. Then, when the recession hit in 2008, we were already deep in a fiscal hole and our ability to take effective countermeasures was dangerously compromised. We must never let that happen again.

In responding to the looming default crisis, House Republicans introduced a bill (H.R. 2560) which they called “Cut, Cap, and Balance.” The bill would hold resolution of the default crisis hostage to passage of a so-called balanced budget amendment, which would actually make it impossible to balance the budget because it would amend the U.S. Constitution to require a “supermajority” of two-thirds in order to approve any revenue increases. That would apply to all revenue-raising provisions — including closing tax loopholes for oil companies and millionaires. It would also set spending caps so low as to require the end of Medicare as we know it.

The Ronald Reagan-Tip O’Neal agreement to save Social Security in 1983 would not have been possible under this proposal. George H. W. Bush’s bipartisan 1990 deficit reduction plan would not have passed this hurdle, nor would the Democratic deficit reduction plan of 1993. So this bill virtually eliminates Congress’ ability to produce meaningful deficit reduction and it would remove important tools Congress has relied on to boost economic growth. The House Republican bill, which I voted against, passed the House; however, because it makes no attempt to compromise, it is not expected to be passed by the Senate and would face a certain veto by the President.

We must avert an economic disaster with massive job losses. We must raise the debt limit by August 2nd so that we can focus on the two pressing and related challenges facing our country: growing the economy and charting a course back to fiscal balance. We know that the best cure for a budget deficit is a growing economy that provides jobs. And a real compromise budget solution requires shared sacrifice from all Americans, instead of trying to balance the budget on the backs of lower-and middle-income Americans while cutting taxes for the wealthy, as House Republicans have proposed. As the details of a comprehensive deficit proposal and broader budget negotiations take shape, I will continue working for a reasoned and balanced approach, one which will ensure that the very foundation of our economy — a strong, well-educated, and growing middle-class — is reinforced, not relegated to the past.

I hope this information is helpful. Again, thank you for contacting me, and please continue to keep in touch on issues of concern.



Member of Congress

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