In a Letter to Budget Committee Leaders, Senators Say Bipartisan 'Pay It Back' Plan Would Help Pay Down Debt, Prevent Further Spending
Washington, DC - Following up on a message from a bipartisan group of Senators yesterday, Senators Michael Bennet (D-CO), Bob Corker (R-TN), Jon Tester (D-MT), Johnny Isakson (R-GA) and Mark Udall (D-CO) sent a letter urging Senate Budget Committee leaders to take groundbreaking strides to reduce our deficits and rein in our debt. In the letter to Senator Kent Conrad, chairman of the Senate Committee on the Budget, and Senator Judd Gregg, ranking member of the Committee, the Senators formally pushed for inclusion of the Pay It Back plan in the Budget Resolution. The plan requires returned emergency spending to go toward deficit reduction, not to fund further spending.
"Taxpayers helped stabilize our economy when our country was on the brink of the next Great Depression," the letter said. "As financial institutions regain their health and our economy stabilizes, we must ensure that any repaid funds from these efforts are used to lower our soaring deficit and debt - not to fund further spending."Below is the full text of the letter:
Senator Kent Conrad, Chairman Senate Committee on the Budget 624 Dirksen Senate Office Building Washington, DC 20510
Senator Judd Gregg, Ranking Member Senate Committee on the Budget 624 Dirksen Senate Office Building Washington, D.C. 20510
Dear Chairman Conrad and Ranking Member Gregg:
We write both to thank you for your bipartisan leadership in pushing for the establishment of a debt commission and also to encourage you to work together to craft a Budget Resolution that does substantially more to protect taxpayers and reduce our deficit.
With respect to the creation of a debt commission, while we lament that the Senate was unable to pass your amendment on its own, we feel that the strong showing of bipartisan majority support for the amendment on the Senate Floor last month was instrumental in bringing greater attention to this critical issue.
With respect to the Budget Resolution you are crafting, we believe that it is incumbent upon Congress to take groundbreaking strides to reduce our deficits. That is why we support the Pay It Back Act, S.1683, a copy of which we have attached. This bipartisan legislation would:
- Capture repaid TARP funds, direct them for deficit reduction, and permanently close TARP's $700 billion revolving door of credit;
- Capture investments from the sale of Fannie Mae and Freddie Mac securities and direct them for deficit reduction;
- Require relevant inspectors general and agency secretaries to identify and capture any ARRA funds that have been turned down or unobligated by the federal government and direct them for deficit reduction;
- Ensure that ARRA funds not obligated by the federal government by December 31, 2012, will be returned to the Treasury and used for deficit reduction; and
- Reduce the national debt limit - dollar for dollar - for all money repaid to the Treasury that is encompassed through any provision in this bill.
The Pay It Back Act does not undermine emergency and recovery efforts. Rather, it sets a schedule for getting the government out of the business of owning businesses. This legislation looks critically at open-ended policies and establishes a responsible way forward that will benefit the American taxpayer.
Taxpayers helped stabilize our economy when our country was on the brink of the next Great Depression. While we can have a healthy debate about whether we should have enacted the TARP, Fannie Mae and Freddie Mac assistance, and ARRA in the first place, what is not debatable is that these provisions have to be temporary. As financial institutions regain their health and our economy stabilizes, we must ensure that any repaid funds from these efforts are used to lower our soaring deficit and debt - not to fund further spending.
As you both know well, our nation is at a budget crossroads. The national deficit for January alone totaled $42.6 billion. And the national debt has grown to a massive $12 trillion. The interest on this debt alone - if we started running surpluses today - will hamstring national priorities for years to come. If left unaddressed, our debt will have severe effects on our kids and grandkids.
We strongly encourage the Budget Committee to adopt provisions from the Pay It Back Act as part of a broader approach to reining in spending and reducing the deficit. In the absence of such steps within the Budget Resolution, we notice the Committee of our intention to pursue an amendment related to S.1683 during the full Senate's consideration of the Budget Resolution in the coming weeks.
With the fast-approaching consequences of our long-term debt so clear, it is incumbent upon this body that we use repaid TARP and other bailout funds to pay down the national debt. We look forward to working with you to accomplish these critically important goals and restoring fiscal sanity.
__________________ __________________ __________________
Michael F. Bennet Bob Corker Jon Tester
United States Senator United States Senator United States Senator
Johnny Isakson Mark Udall
United States Senator United States Senator