AUGUST, 2011

In This Issue
Debt Ceiling
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Fast Facts

 


"Make no mistake. This agreement is stark and stern but necessary."

Sen. Barbara Mikulski

 
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Avoiding Default and Downgrade

    

 

After wrenching analysis, I voted in favor of the bipartisan Senate solution to avoid default and downgrade.

Make no mistake. This agreement is stark and stern but necessary. It includes cuts that I would have never voted for under different circumstances. However, if we had failed to take action, the economy of the United States would have been irrevocably fractured.

While it’s far from perfect, the agreement meets my principles for avoiding default and downgrade. It provides a long-term extension of the debt ceiling, a significant down-payment on cuts, and a path forward to reform tax earmarks and entitlements.

A default and downgrade would have led to sky-high interest rates that would have created a new tax on every single American. The economy would be further weakened, and it would be a self-inflicted wound. I could not allow this to happen.

I took an oath to protect and defend the Constitution. The 14th Amendment says that the validity of America’s debt must not be questioned. While the lawyers made the interpretation complicated, the framers made it simple. America pays its debt with no exceptions. Failure to reach an agreement would be a violation of trust to the American people and our creditors. And it would violate my oath to the Constitution.

America must meet its obligations to its creditors. We must also meet our obligations to each other. Throughout this debate, I have insisted on no benefit cuts to soldiers, seniors and veterans and will continue to do so. Obligations made must be obligations kept.

I will also fight to fulfill our obligations to the next generation who will lead us through the 21st Century. We need to rebuild roads, bridges and increase access to broadband to create jobs and rebuild our economy. We need to invest in higher education, science, research and technology that lead to jobs of the future. We can’t afford not to make these investments.



 

Fast Facts About the Debt Ceiling Plan

 

Immediately enacts 10-year discretionary spending caps generating nearly $1 trillion in deficit reduction, balanced between defense and non-defense spending.

Authorizes the President to increase the debt limit by at least $2.1 trillion, eliminating the need for further increases until 2013.

Sets up a bipartisan committee process to identify an additional $1.5 trillion in deficit reduction, including from entitlement and tax reform. Congress is required to vote on the Committee’s recommendations by December 23, 2011.

If the Committee fails, an enforcement mechanism will trigger spending reductions beginning in 2013 – split 50/50 between domestic and defense spending. Enforcement protects Social Security, Medicare beneficiaries, and low-income programs from any cuts.