Congressman Henry Cuellar (TX-28) released the following statement today after voting against S. 627, the Republican Default bill:

“Every lawmaker can agree that the federal government must act now to solve our nation’s serious budget problems. With less than a week before the Aug. 2 deadline to raise the debt ceiling, the urgency of the situation has intensified. I strongly believe that bipartisan and bicameral work must be done to find a solution that will reduce our spending and raise the debt ceiling before the deadline. Today, the Republican Majority in the U.S. House of Representatives brought up a bill that lacks serious bipartisan input, and will cause a downgrade in the United States’ credit rating and fails to protect American families and the vital programs we use daily.

“I am disappointed that the House bill ignores the very warnings that economists, investors and credit rating agencies have cautioned the United States to avoid by bringing forward a short-term debt limit increase. Rather than putting forward a long-term debt limit solution, House Republicans decided to put off tough decisions now and require us to revisit this debt ceiling debate in less than six months, again, placing the world and country into economic uncertainty for the next two years. Standard & Poor’s credit rating agency has confirmed that a short-term fix would still trigger our country’s credit downgrade. This proposal is a non-starter for our already uncertain financial global markets and would certainly rattle our frail economy.

“As early as last week, Republican leaders in the House called for a single debt limit increase and a long-term solution. Now, they are singing a different tune and have flip-flopped to a short-term debt limit increase. Even the former Congressional Budget Office Director, Rudy Penner, appointed by Republican President Ronald Reagan, has said he would much prefer a debt limit increase through 2012 ‘just to delay the type of uncertainty that would be created by a repeat of this debate.’

“It is unacceptable to play politics and allow the largest economy in the world to default on its own debt. A default will not only have a negative global impact, but Americans may not receive their Social Security checks or other vital services. Lawmakers should not get paid while veterans, seniors and those with disabilities will not be receiving benefits because of the country’s default. This is why I am an original cosponsor to the “Stop Pay for Members Act” that would place Members of Congress last on the list to get paid if we default. It is time for Republicans to stop risking our economic security and work with Democrats to enact a long-term, balanced approach to pay our nation’s bills and reduce the deficit. The American people, small businesses and our financial markets need certainty to move our country on a path to responsible deficit reduction – not default.”

Background:

S. 627, the Republican Default legislation was taken up by the U.S. House of Representatives on Friday, July, 29, 2011, and passed by a vote of 218-210. The bill creates a two-step process for the President to increase the statutory debt limit by as much as $2.5 trillion, following the enactment of $2.7 trillion in spending cuts and other deficit reduction measures. The first step would cut approximately $915 billion and raise the debt ceiling by $900 billion. In six months, Congress must revisit raising the debt ceiling and enact the second step in the process by cutting $1.8 trillion over 10 years through caps and raise the debt ceiling by $1.6 trillion. This bill was revised once the nonpartisan Congressional Budget Office estimated that it would only reduce deficits by $850, thereby violating the Republicans requirement that cuts exceed any increase in debt limit. The House of Representatives voted on the revised bill that would comply with the GOP requirement.

S. 627 is strongly opposed in the Senate and by the Administration. The National Education Association, Club for Growth and other organizations have come out in strong opposition to the bill. 

Congressman Henry Cuellar is an original cosponsor to H.R. 2653, the “Stop Pay for Members Act” that would require that Members of Congress be paid last should the public debt limit be breached. This would ensure that while the Treasury is deciding which payments to make in the event of a United States default, that the Members of Congress not receive their paycheck and be last for consideration.  

Additionally, Congressman Henry Cuellar has signed onto a letter to House Speaker Boehner and House Democratic Leader Pelosi regarding the budget plans proposed by Speaker Boehner and Senator Reid. The letter raises important issues that must be solved before a House vote on legislation – to ensure a long-term fiscal solution. The letter also recommends creating a Joint Congressional Committee to continue work on debt and deficit reduction.