WASHINGTON – Rep. Jeb Hensarling (R-Texas), co-chairman of the Joint Select Committee on Deficit Reduction, delivered the following remarks to open today’s organizational meeting of the committee.
“The late Spanish philosopher George Santayana famously wrote, ‘Those who cannot remember the past are condemned to fulfill it.’
“In 2009, Professors Carmen Reinhart and Kenneth Rogoff published what may be the seminal work on the subject of past debt crises entitled, ‘This Time is Different.’ Studying many different examples over a vast expanse of world history, their work paints a tragic mosaic of high unemployment, currency debasement, civil unrest, lost economic growth and in extreme cases the collapse of a nation. This is a past we in America do not want to fulfill. Unfortunately, when it comes to our own debt crisis, the needle on the gauge has now entered the red zone.
“To begin, our debt threatens our jobs.
“Speak to any Fortune 500 CEO or small business person. It is clear that our debt hangs like the Sword of Damocles over their hiring decisions. As one small businessman put it, ‘Jeb, I know somehow, someway I’m going to have to pay for all this debt. So now is not the time I’m going to take the risk of buying new equipment or hiring a bunch of folks.’
“As his elected representative, how can I possibly ignore such a sentiment—especially when I hear it everywhere I go and I know it’s shared by thousands and thousands of other employers from coast to coast?
“It should be obvious that deficit reduction and a path to fiscal sustainability are themselves a jobs program.
“Secondly, our debt threatens our national defense.
“No less of an authority than the Chairman of the Joint Chiefs of Staff, Mike Mullen, has said, ‘The single biggest threat to our national security is our debt.’ In interest payments alone, we are enabling China to buy two jet fighters a week.
“Is it not our public duty to respond to this kind of warning with the same alarm and resolve that would be summoned to defeat any other threat to our nation? “Finally, our debt threatens our children’s future.
“Ominously, spending has grown from its historic norm of 20 percent of our economy to 24 percent and is on a glide path to grow to 40 percent and beyond over the course of a generation.
“If financed through borrowing, interest payments alone will crush our economy. If financed through taxes, the tax burden will have to more than double – a burden never dreamed of by the American people and the businesses which employ them. Should we let this happen, we would be the first generation in America’s history to leave the next with less freedom, fewer opportunities, and a lower standard of living.
“I will not sit idly by and watch the American dream disappear for my nine year old daughter and seven year old son. I believe that is a sentiment shared by all my colleagues.
“So what exactly is driving our debt? President Obama has said, ‘The major driver of our long-term liabilities, everybody here knows it, is Medicare and Medicaid and our healthcare spending. Nothing comes close.’ I agree. The president has also said, ‘If you look at the numbers, then Medicare in particular will run out of money and we will not be able to sustain that program no matter how much taxes go up. …. It’s not an option for us to just sit by and do nothing.’ Again, I agree.
“That takes us to the charge of the Joint Select Committee on Deficit Reduction.
“In order to succeed, this committee must primarily be about saving and reforming social safety net programs that are not only failing many beneficiaries but going broke at the same time.
“Undoubtedly, this will be part of an ongoing debate about our nation’s values, the role of government in a free society, and our generation’s place in history.
“I approach our task with a profound sense of urgency, high hopes, and realistic expectations. The question we must ultimately ask ourselves given this moment in history is, ‘Does the product on balance take America in the right direction or in the wrong direction?’
“As we proceed, like any other committee in Congress, there will be public hearings. There will be ample opportunities for the public to have their opinions heard. And like any other committee of Congress, there will also be some discussions among members that will not be public. However, no final product will be adopted without ample public notice and a public vote.
“Whatever this committee may achieve, I hope we at least can agree that it is past time to quit spending money we don’t have. It is past time to quit borrowing 42 cents on the dollar, much of it from the Chinese, and then sending the bill to our kids and grandkids.
“I do not believe this committee alone will solve the nation’s debt crisis. But a bi-partisan negotiated reduction in the growth of our nation’s debt would be a wonderful, needed, hopeful step in the right direction.
“Beyond this committee and this congress, our generation will one day be judged. Will history record that we wrote the first chapter of America’s decline? Or will history record that we kept faith with the founding fathers and previous generations and left the next generation with greater blessings of liberty and vaults of limitless opportunities? The choice is ours, let the work begin.”