Hurricane Katrina Unearths the Disastrous Fiscal State of Our Country
Mr. Speaker, almost a year ago, I spoke on this House floor warning of the dangers posed by the latest effort of the majority party to raise the debt limit for the third time during this administration to a whopping $8.18 trillion.
I used the occasion to contrast the fiscal policies of the Clinton administration, namely, turning the largest budget deficits in history to the largest budget surpluses in history, with the fiscal policies of the current administration. However, my protestations and the warnings of my fellow Blue Dog Democrats continued to fall on deaf ears.
It is inconceivable that deficits soaring as far as the eye can see, mounting debt, and the skyrocketing costs of military operations in Iraq and Afghanistan would be ignored for so long and that it would take a tragedy such as Hurricane Katrina to finally serve as a wakeup call. For years members of the Blue Dog Coalition have warned that we were spending money we did not have, that the administration had no economic plan, and that massive untargeted tax cuts were not a substitute for an economic blueprint for our country's future. And yet the Congress continued to reject every proposal requiring us to do our budget in the same way that our constituents do, by paying as we go.
Now that Hurricanes Katrina and Rita have wreaked havoc on the gulf coast, causing hundreds of billions of dollars of damage, it is clear that we must take immediate action to get our fiscal house in order. Members on the other side of the aisle have finally acknowledged what Democrats have been saying for years, that our current economic policies cannot be maintained. Unfortunately, however, some in the majority party have proposed that we ask those Americans who have been impacted most by Katrina, namely, the elderly and those with low incomes, to bear the costs.
This is not the answer to the persistent poverty exposed so brutally and graphically by Katrina. We must pursue a comprehensive solution to our fiscal woes by suspending tax cuts for wealthy families, by cutting spending, and enacting PAYGO rules, pay-as-you-go, and establishing an emergency rainy day fund.
Mr. Speaker, the 2005 budget resolution included $106 billion in new deficit finance tax cuts over the next 5 years. These additional tax cuts will impose a huge additional debt burden on the next generation. If the government is forced to borrow the money to cover these added expenses, the yearly interest payments alone will pile on the already enormous debt that our children and grandchildren will be faced with paying off.
Most of these tax cuts will actually be doled out to individuals who do not need more of the government's largesse. With American troops in combat in Iraq and Afghanistan and with our country coping with the rebuilding of the gulf coast, all of us, all of us, must sacrifice for our troops and for our neighbors.
In addition to suspending tax cuts for wealthy families, the Congress must immediately restrain its voracious appetite for spending, finding places where cuts can be made to pay the costs of Katrina and Iraq. And in addition to making tough cuts, the Congress should move to immediately reinstate PAYGO rules to stop any further bleeding.
Finally, the Congress must establish a rainy day fund for future Katrinas so we will not find ourselves in this spot again. The interest earned by such a fund could be used for disaster planning and preparedness, to modernize our Nation's infrastructure, fortify our levees, and to update and make interoperable our communications systems.
The American people now understand the precarious state of the Nation's finances. Today our national debt stands at nearly $8 trillion. Each citizen's personal share of that debt is almost $27,000. This is what we bequeath to our children, and it conflicts most directly with what my parents taught me and what most of our parents taught all of us, that is, we leave the country a little better off than we found it.
In 1989, a New York City real estate developer named Seymour Durst placed a large National Debt Clock in Times Square in order to draw public attention to what he saw as a grim predictor of financial instability. For 11 years, the debt numbers on the clock rose at the breakneck pace of $13,000 a second. In 1995, as the Clinton administration began to pay down the national debt, onlookers were shocked to see the numbers on that clock not only slow down but reverse. The clock was retired in the year 2000, as President Clinton announced record reductions in the national debt.
Mr. Speaker, unfortunately, no debt clocks were at work this time drawing attention to this crisis. It has taken Katrina to awaken the Nation to the coming fiscal crisis. Let us hope our response to this crisis is an improvement on our response to the last. We owe that to our kids.