U.S. Sen. Mark R. Warner (D-VA), a member of the Fiscal 2014 Budget Conference Committee, outlined his goals during today’s first meeting of House and Senate budget negotiators. Sen. Warner said he wants to end the recent fiscal practice of lurching from crisis to crisis, find a way to replace the damaging, across-the-board spending cuts mandated by sequester, and look for opportunities to make responsible investments that will strengthen the economic recovery and promote American competitiveness. Negotiators have until December 13 to find a budget compromise.
The text of Sen. Warner’s prepared remarks is below, and video can be accessed here.
“There are three touchstones that I hope come out of this effort:
First, do no harm -- which would mean that acknowledging that another government shutdown, or threatening the full faith and credit of the United States, does no good and presents enormous economic crisis. We all have the numbers on what the price was. We all have fun factoids. Mine is the fact that during the shutdown we furloughed three American Nobel Prize winners in physics. You wonder what the governments of Russia, India, China and around the rest of the world were thinking when we furloughed these kinds of American assets. I can assure you, they did not put their research on hold during our period of dysfunction.
Second, sequestration was supposed to be so bad that no rational group of people would let it happen. I think there is a way that we cannot only protect savings but find ways to replace sequester. I know some of my colleagues think it hasn’t been that bad, but I believe it’s almost like a cancer inside. I can tell you, in Virginia, we are a little bit like Ground Zero because of the federal workforce and military personnel that live here. What we are doing in terms of hurting military readiness, costing taxpayers money because we the Department of Defense cannot do long-term purchase contracts, is totally irresponsible.
I know a lot of us around this table like to cite our business experience. I am proud that I have been a business guy longer than I have been a political guy. My time in business was mostly spent as an investor. When you are an investor looking at a business plan, you look at the company’s plan for its workforce, its investments in plant and equipment, and how they plan to stay ahead of their competition. Countries have a business plan, too: it’s called the federal budget. We have those three items, too: ‘workforce’ is called education and training – ‘plant and equipment’ is infrastructure – and ‘staying ahead of the competition’ is research and development.
And while I strongly believe most of our job growth is going to come from the private sector, the government does provide a framework in those three areas which allows the private sector to prosper. Unfortunately, if we go forward with an approach that indiscriminately cuts those areas of investment in infrastructure, education and R&D, we are not going to have a business plan that allows our country to prosper over the long-term. So I hope we can find common agreement to replace the sequester and make investments in those areas.
Third, and I know this may be a bit off-script, but I hope that we actually might be able to exceed expectations. I think we’ve done an appropriate job of lowering expectations, so that simply avoiding a crisis may be viewed as a success. But I think that while we may not be able to get to the so-called grand bargain, we ought to use this opportunity to recognize that if we keep coming back to the discretionary bucket, whether it’s on the defense side or the non-defense side, it becomes a zero-sum game after a period.
I would say, as somebody who acknowledges we need to look at entitlements, when we hear these constant references to 50-year revenue totals, I just think it refuses to recognize some of the fundamental changes in our economy right now. I’ll just cite two: the dramatic transfer of research and development from the private sector to the public sector. That’s not just happening in America. It’s all across the world. There is no such thing as Bell Labs anymore. And increasingly, for us to stay competitive, the public sector is going to pick up R&D. And because we’ve been blessed with a much longer lifetimes, entitlement costs – even with entitlement reform – are going to be greater than we’ve seen in the past because life expectancy now exceeds 80. So we all know what we’re going to have to deal with: Democrats are going to have to deal with entitlement reforms, and Republicans are going to have to deal with revenues, and we ought to be willing to at least approach those areas.
I would close by simply saying we all have lots of ideas about how we can build our economy. I think there would be nothing that would do more for job creation and economic growth than removing this fiscal overhang of governing by crisis.
I hope that we can exceed expectations and do that.”
Transcript below:
MR. PRESIDENT, I WANT TO FOLLOW UP ON THE COMMENTS OF MY COLLEAGUES, SOME OF THE SENATORS WHO HAVE SPOKEN BEFORE ME. IT SEEMS LIKE WE'VE ACCEPTED THIS NEW NORMAL, THAT SHUTTING DOWN THE OPERATIONS OF THE LARGEST ENTERPRISE IN AMERICA IS ACCEPTABLE.
I WANT TO CONCUR WITH MY COLLEAGUE, THE SENATOR FROM ALASKA, ABOUT THE REAL STORIES AND REAL PAIN THAT'S TAKING PLACE BECAUSE OF THIS GOVERNMENT SHUTDOWN. AND I COMMEND SOME OF MY COLLEAGUES' COMMENTS WHO WHEN WE READ THESE TRAGIC STORIES, WHETHER IT'S AROUND N.I.H., AROUND OUR VETERANS, AROUND OUR PARK SERVICE, OH, BUT THAT PART OF THE GOVERNMENT WE REOPEN. DOES THAT MEAN EVERY OTHER ASPECT OF GOVERNMENT REMAINS CLOSED UNTIL WE CAN FIND THAT STORY?
I POINT OUT TO MY COLLEAGUES STORIES THAT WERE IN BOTH "THE WASHINGTON POST" AND "THE NEW YORK TIMES" TODAY, A STORY THAT WE SHOULD BE CELEBRATING ABOUT THREE AMERICAN NOBEL PRIZE WINNERS. WELL, DOES THAT MEAN WE SHOULD NOW REOPEN THE N.S.F. BECAUSE IF THE NATIONAL SCIENCE FOUNDATION ISN'T FUNDED, THERE MAY NOT BE A NEXT GENERATION OF AMERICAN NOBEL PRIZE WINNERS? WE HAVE TO BRING IN A STORY ABOUT SOME CHILD BEING HURT BECAUSE OF THE FOOD OR THE MEAT OR THE FISH WASN'T INSPECTED CORRECTLY?
I'VE GOT TO TELL YOU I SPENT A LOT LONGER IN BUSINESS THAN I HAVE IN POLITICS, AND I'VE BEEN INVOLVED IN A LOT OF BUSINESS NEGOTIATIONS. BUT I'VE NEVER BEEN INVOLVED IN A NEGOTIATION THAT SAYS DURING THE NEGOTIATION WE HAVE TO SHUT DOWN THE OPERATION OF OUR BUSINESS AND INFLICT PAIN NOT ONLY UPON OUR EMPLOYEES, BUT UPON THE GENERAL ECONOMY ACROSS THE BOARD. THAT IS NOT THE WAY TO GOVERN.
AND I WOULD AGREE WE'VE TALKED ABOUT STORIES WITH FEDERAL WORKERS, BUT I WOULD AGREE WITH THE SENATOR FROM ALASKA, IT IS ALSO THE HOTEL OWNERS ALONG THE SKYLINE DRIVE IN OUR STATE OF VIRGINIA, THE GOVERNMENT CONTRACTORS WHO START AND STOP BECAUSE THEY DON'T UNDERSTAND WHAT GOVERNMENT IS GOING TO OPERATE.
THIS PIECEMEAL EFFECT, THIS PIECEMEAL APPROACH TO REOPENING GOVERNMENT MAKES NO SENSE. WHAT MIGHT BE BETTER, IS WE HEAR FROM SOME OF THOSE FOLKS WHO WANT TO HAVE THIS PIECEMEAL EFFECT, MAYBE THEY SHOULD TELL US WHAT PARTS OF THE GOVERNMENT SHOULD STAY CLOSED?
THIS IS NOT THE WAY TO OPERATE. WE OUGHT TO REOPEN THIS GOVERNMENT, PUT OUR PEOPLE BACK TO WORK, GET THIS ECONOMY GOING AGAIN, AND CONTINUE THE VERY REAL CONVERSATIONS WE'VE GOT TO HAVE ABOUT GETTING OUR FISCAL HOUSE IN ORDER.
AND WHAT MAKES THIS, TO ME, IN THE FOUR AND A HALF YEARS I'VE BEEN IN THE SENATE, DIFFERENT THAN THESE PREVIOUS DISCUSSIONS AND DEBATES IS THAT WE HAVE THIS, FIRST IN MY TENURE IN THE SENATE, GOVERNMENT SHUTDOWN WHICH DISPROPORTIONATELY IS HURTING VIRGINIA AND MARYLAND BUT IS LITERALLY HURTING EVERY COMMUNITY ACROSS AMERICA. BUT WE HAVE THIS TRAGEDY, THIS CATASTROPHE MERGING NOW INTO A DEADLINE THAT'S GOING TO HIT US NEXT WEEK WHERE THERE ARE CERTAIN MEMBERS OF CONGRESS WHO SAY IT'S OKAY IF AMERICA DEFAULTS.
I FIND THAT STUNNING.
IF YOU LOOK BACK, THERE HAS NEVER BEEN A MAJOR INDUSTRIAL COUNTRY IN MODERN HISTORY THAT HAS DEFAULTED. AS A MATTER OF FACT, THE LAST MAJOR COUNTRY TO DEFAULT WAS ARGENTINA BACK IN DECEMBER OF 2001. THE AFTERMATH OF THAT DEFAULT, THEY HAD OVER 100% PER ANNUM INFLATION. EVERY FAMILY IN ARGENTINA SAW LITERALLY 60% OF THEIR NET WORTH DISAPPEAR WITHIN A FEW WEEKS. AMERICA IS NOT ARGENTINA. BUT WHY WOULD WE EVEN GET CLOSE TO THAT KIND OF POTENTIAL ECONOMIC CATASTROPHE?
AND HAS BEEN MENTIONED ALREADY, AMERICA HOLDS A RECORD AS RESERVE CURRENCY FOR THE WORLD. WHEN CRISES HAPPEN AS HAVE HAPPENED AROUND THE WORLD RECENTLY, PEOPLE AND CAPITAL FLOWS INTO THE DOLLAR. THAT'S BECAUSE THE DOLLAR AND THE UNITED STATES FULL FAITH AND CREDIT HAS NEVER BEEN SUSPECT. IT'S NEVER BEEN A QUESTION OF WHETHER WE'RE GOING TO HONOR OUR COMMITMENTS. WELL, MR. PRESIDENT, NEXT WEEK OR VERY SHORTLY AFTER THAT HISTORY IS GOING TO BE PUT POTENTIALLY IN JEOPARDY.
AND I'M JUST GOING TO TELL YOU I HEARD THOSE WHO SAY WE CAN PRIORITIZE PAYMENTS. THERE IS NO BUSINESS GROUP IN AMERICA AND NO ECONOMISTS THAT I KNOW OF, FROM THE LEFT OR RIGHT, WHO BELIEVES THAT SOMEHOW AMERICA CAN PARTIALLY DEFAULT AND PRIORITIZE PAYMENTS: WE'RE JUST GOING TO PAY INTEREST, WE'RE JUST GOING TO PAY OUR TROOPS…
THOSE OF US WHO SERVED AT STATE LEVELS REALIZE THAT SOMETIMES OUR BUDGETS ARE CLOSE TO 50% PASS-THROUGH FROM THE FEDERAL GOVERNMENT. THE PRESIDING OFFICER, THE GOVERNOR FROM THE GREAT STATE OF WEST VIRGINIA, HOW LONG BEFORE WEST VIRGINIA DEFAULTS IF AMERICA STARTS PRIORITIZING ITS PAYMENTS? HOW MANY DETROITS WOULD THERE BE ALL ACROSS AMERICA IF WE WERE TO TAKE THIS TYPE OF IRRESPONSIBLE ACTION? AND EVEN IF THERE WAS SOME POSSIBILITY THAT THERE MIGHT BE SOME CHANCE OF SOME LOGIC BEHIND THIS PARTIAL PAYMENT SCHEME, IT'S NEVER BEEN TRIED BEFORE. NO INDUSTRIAL COUNTRY HAS EVER GOT THIS CLOSE TO A DEFAULT.
WHY WOULD WE TAKE THE CHANCE? WHY WOULD WE PLAY RUSSIAN ROULETTE WITH ONLY ONE BULLET AND TWO CHAMBERS? THAT IS SOMETHING THAT AT THIS MOMENT FOR OUR NATIONAL ECONOMY AND THE WORLD ECONOMY CAN BE DEVASTATING.
SO, MR. PRESIDENT, I KNOW WE SEEM TO BE REPEATING OURSELVES ON BOTH SIDES, BUT TO ME IT SEEMS VERY EASY TO GET TO NEGOTIATION. WE'VE GOT DIFFERENCES. I WOULD SAY TO MY COLLEAGUES, I PROBABLY MAKE FOLKS ON MY SIDE MORE ANGRY THAN ANYONE ELSE ON THESE ISSUES AROUND GETTING OUR COUNTRY'S BALANCE SHEET IN ORDER. I'M ANXIOUS TO CONTINUE THOSE DISCUSSIONS ABOUT TAX REFORM, ABOUT ENTITLEMENT REFORM, ABOUT BRINGING OUR DEBT TO G.D.P. RATIO DOWN.
BUT WE CANNNOT HAVE THAT KIND OF NEGOTIATION WHILE YOU'VE GOT THE GOVERNMENT SHUTDOWN AND THE FULL FAITH AND CREDIT OF THE UNITED STATES IN JEOPARDY. LET'S OPEN THE GOVERNMENT NOT JUST BECAUSE WE HEAR SOME TRAGIC STORY ABOUT ONE COMPONENT OF THE GOVERNMENT, NOT JUST BECAUSE WE NEED TO COME AND MAKE THAT CASE ABOUT FOOD INSPECTORS, ABOUT NATIONAL SCIENCE FOUNDATION, ABOUT NASA LANGLEY WHERE WE DO AERONAUTICS RESEARCH -- 3,500 SCIENTISTS, AND LAST WEEK THERE WERE SEVEN ON THE JOB. CHINA, INDIA, OTHER NATIONS ARE S NOT STOPPING THEIR RESEARCH BECAUSE WE CAN'T GET OUR ACT TOGETHER.
OPEN THIS GOVERNMENT, TAKE OFF THE TABLE THE IDEA THAT AMERICA WOULD DEFAULT. THEN I AM ANXIOUS TO JOIN WITH COLLEAGUES ON BOTH SIDES OF THE AISLE TO GET OUR COUNTRY'S BALANCE SHEET IN ORDER. BUT TO CONTINUE TO HOLD THIS ECONOMY AND THESE STORIES OF THESE AMERICANS' LIVES IN THIS LIMBO IS IRRESPONSIBLE BEYOND WORDS. SO, MR. PRESIDENT,
LET'S GET THIS GOVERNMENT OPEN. LET'S MAKE SURE THAT WE'RE GOING TO HONOR AND PAY OUR DEBTS, AND LET'S GET TO THE VERY, VERY REAL, IMPORTANT QUESTIONS OF HOW WE GET OUR NATION'S BALANCE SHEET RIGHT.
Sen. Warner has heard from a Virginia contractor with 5,500 employees, built over 25 years, who faces bankruptcy in a matter of weeks due to the government shutdown. This is causing havoc in the economy.
Mr. WARNER. Mr. President, I rise today to state a principle that is known well by those of us who have served in the private sector, and that principle is simply this: What gets measured gets done.
This week, as my colleague from New Hampshire has already stated, we begin work on the Federal budget even as we are implementing the American Reinvestment and Recovery Act.
Both of these actions can either confirm the claims of critics, the skeptics who always say that Washington simply is not capable of managing the taxpayer's money responsibly or it could present us with a tailor-made opportunity to demonstrate that we can combine bold action with innovation and transparency as we work to get our economy and our country back on the right track.
In the near term, the targeted investments included in the Recovery Act are designed to create millions of new jobs.
The President's budget proposals, if they are enacted, will allow us to make longer term investments through the expanded use of electronic health records, the build-out of the smart grid, and through energy-saving improvements to millions of homes and businesses.
Now, I do not think the American people expect miracles--but they can, and they should, expect competence.
So we must put in place the people with the right skills, insist on appropriate measurements, and then demand transparency and accountability.
When I became Virginia's Governor at the peak of an earlier recession, back in 2002, I inherited a $6 billion revenue shortfall in Virginia's $34 billion annual budget.
Our administration made the painful spending cuts, but then we did something else: we used that opportunity to enact long-term budget reforms that continue to save taxpayer money today.
For instance, we renegotiated a number of our State contracts and leveraged our purchasing power. We reduced the cost of light bulbs from 32 cents to 23 cents. Now, saving nine-cents per bulb will not close a $6 billion shortfall, but the State buys an awful lot of light bulbs.
We found similar savings in procurement across much of State government, bundling our purchasing power the same way many major businesses do.
We examined and then eliminated outdated boards and commissions. We consolidated our State information technology activities. We took a whole new portfolio approach to managing our real estate holdings and our vehicle fleet, just as any business would.
These business-like reforms produced almost immediate taxpayer savings. And it accomplished something else as well: it created an expectation of transparency and accountability that resulted in Virginia being independently designated as the Nation's best managed State, and the best State for business investment.
I do not rise today to brag on the Commonwealth of Virginia well, perhaps a little bit. Instead, I rise today to suggest that this same approach--straight talk, tough choices, and an insistence on commonsense reform and accountability--is critically important here and now in Washington, DC.
President Obama has made it clear to Governors and mayors across the country that we need their help for this Recovery and Reinvestment Act to succeed. I commend the administration for insisting that accountability does not simply stop at the State capital, once a Governor releases funds to localities. We must have the same high standards of accountability at the local level as well.
I also am pleased that the administration's recovery.gov Web site conveys a lot of useful information to the taxpayers in a clear and user-friendly way. And by midweek, all but a handful of States are expected to launch similar Web sites of their own.
But as they launch these Web sites, we must make sure that they have standard metrics so we can actually compare progress from one State to another.
It is also imperative that we keep the pressure on officials at every level of Government to continue to aggressively look for even more creative ways to make these sites more useful.
In recent weeks, I have spoken to key administration officials about what other steps we might take to promote transparency and accountability in implementing the Recovery Act.
If we do this right, it could build a solid foundation to promote longer term fiscal responsibility as we move forward in the Federal budget process.
For instance, I believe we should drill-down and reach consensus on commonsense definitions and metrics. Let me give you an example.
When I chaired the National Governors Association in 2005, we launched a major effort to reform our high schools. I was astonished to learn there was no common definition across the States of `high school graduate.'
So we spent months working with educators, academics and policymakers to reach a common definition so we could determine whether a high school graduate in Alaska or in New Mexico was meeting the same kind of qualifications as a high school graduate in Virginia.
That now allows us to look at those programs that work--and those that don't--across all of the States.
I believe that experience provides a useful model as we work to develop a common set of metrics that allows us to honestly and effectively track Federal spending, especially with the stimulus dollars where we are ramping up so many new initiatives in such a short time-frame.
To do this, we will need to work through existing organizations, such as the National Governors Association, the Conference of Mayors, the National Association of Counties, and others, as we work to design effective measurement tools.
For example, most of us agree that expanding high speed Internet broadband to rural communities will create jobs. It will allow folks in every region of our Nation to have an opportunity to compete and win in the global economy.
Obviously, as we roll out broadband, we will track our progress by noting how many communities are served and the number of Internet connections that are added.
But what if we also came up with a way to capture information about how many rural businesses were able to launch or grow because of this expanded access to broadband? That information would allow us to measure the true value of broadband to the longer term economic viability of our rural communities.
Or consider our commitment to dramatically expand weatherization improvements to the homes of lower-income Americans. Now, certainly we will tally the number of structures that undergo these energy-saving upgrades, and it should be relatively easy to document the number of workers in the weatherization program.
But couldn't we also come up with some way to measure what one would reasonably expect to be a reduction in the annual demand for Government-funded heating and cooling assistance? And wouldn't that information be helpful as we consider funding levels for LIHEAP and similar assistance in the years to come?
In short, I believe every level of Government should go the extra mile in laying out exactly how the Federal dollars are being spent, and we should honestly measure and disclose program outcomes.
I also think, as we roll out these major expenditures, it is a good idea to link disbursements with predetermined timelines and checkpoints to better track our progress. Let's not wait until all of the money is spent before we determine whether the program works or not.
Consequently, if we do not see appropriate progress, we could delay or defer future payments.
In addition, Federal and State governments also should be encouraged to reach outside their comfort zones and challenge individuals in the private sector to step-up and provide specialized expertise.
Again, within the Recovery and Reinvestment Act, we are going to be ramping up a series of important new initiatives on a very short timeline.
How do we get the expertise from the private sector to engage in this effort? For example, this could be part of the Serve America Act, which we will consider and vote on this week, which will promote and expand public service opportunities for our citizens.
We must try to draw upon the best and brightest to bring them into Government service, even if it is on a part-time basis, as we ramp up these new initiatives.
I am talking about men and women with proven management capabilities, individuals who can move with the speed of venture capitalists to embrace new ideas, or recently retired military leaders who have successfully overseen relief efforts.
This is the type of expertise we need to draw upon if we are going to ramp-up these programs successfully. And as we do this, we must also have the courage to cut back or eliminate programs that cannot prove their worth.
As a former Governor who enjoyed line-item veto authority, I wholeheartedly support President Obama's pledge to conduct a line-by-line review of the federal budget to identify waste and fraud.
I also encourage the administration to conduct a broad-based review of Governmental programs--a review that is horizontal, not just vertical.
Based upon my experience as Governor, and the experiences of countless Fortune 500 companies, I know that an enterprise-wide review could reveal additional opportunities to wring-out significant budget savings.
Typically, one can find sustainable savings in three areas: procurement, technology, and human resources.
That is why it is vitally important that the administration move quickly to appoint its chief performance officer, and that CPO must have the authority to act quickly, along with the chief information officer and chief technology officer. These individuals must have a mandate to work across multiple Federal agencies, and I hope they ruffle a few feathers.
Mr. President, I will say it again: what gets measured gets done.\
In the short term, creating an expectation of transparency and accountability will maximize our `bang for the buck' as we continue to implement the Recovery Act.
And over the longer-term, this focus and genuine commitment to fiscal responsibility will demonstrate that Washington can, in fact, act with both confidence and restraint when it comes to spending the taxpayer's money.
