Transcript: Senate hearing Q&A with Sen. Rob Portman & Treasury Secretary Jack Lew on the debt ceiling – Oct. 10, 2013

Partial transcript of Q&A between Sen. Rob Portman (R-Ohio) and Treasury Secretary Jack Lew on the potential impacts of the failure to raise the debt ceiling. The Senate Finance Committee hearing was held on Oct. 10, 2013:

Sen. Rob Portman (R-Ohio):
…My view is it’s kind of strange the President would one, not negotiate, but two, say we haven’t added stuff. It’s all that has worked to deal with this. And you indicated this earlier it only makes common sense because it’s a tough vote, as you said. Why? Because our constituents don’t get it. You know, why would you extend the credit card again, go to the limit again, without dealing with the underlying problem? And that’s why the polling shows by over two to one, the American people say, “Yeah, we should extend the debt limit but only if we deal with the underlying problem.” And that’s all we’re asking.

Speaking for myself, I will say we need to avoid a debt limit crisis but we also need to avoid a debt crisis. So avoiding a debt limit crisis today and avoiding a debt crisis tomorrow should be our objective.

The President himself said back in 2006 when the debt was half as big as it is today – $8 trillion – and this is a floor speech – “America has a debt problem and a failure of leadership.” And he said, “I’m therefore going to oppose the increase to the debt limit.” He opposed it when it was half as big as it was today. He said we need to deal with the underlying problem.

And in response to Sen. Hatch’s question about why the President refuses to deal with the underlying problem, which we all know is the two-thirds of the spending and the biggest part of the spending and the fastest part of the spending, it is on autopilot that we don’t appropriate every year, which is the mandatory side. In response to that question, you said – and I quote – “He put in his budget significant entitlement spending reforms. He wants to do this. And in fact, you’re right. The President’s proposal includes a pretty long list of entitlement savings – about $730 billion over 10 years – a step in the right direction. During that time, by the way, we’re likely to add another $8 trillion to the debt based on the CBO – Congressional Budget Office. But he’s got $730 billion over 10 years.

Now, not all those choices reflect my top priorities or others in this committee probably. But in a negotiation you don’t get everything you want.

So my question to you today really is very simple: By adding some of those proposals – maybe not all $730 billion, maybe it’s $500 billion, maybe it’s $400 billion – but by adding some of the President’s own proposal to an extension of the debt limit, consistent to what’s been done historically and consistent with what the American people are asking for, couldn’t we move forward and isn’t that what we ought to be doing? Dealing, yes, with the debt limit but also with the underlying problem and taking the President’s own proposals to do it?

Treasury Secretary Jack Lew:
Senator, on the history of the debt limit, you and I have been back and forth many times. I think it makes a big difference if you tack a debt limit increase onto something that’s already been agreed to. In 1997, the balanced budget agreement was all signed and sealed and a debt limit increase was put into it. It didn’t drive it; nobody threatened default. So I think we’re in a different situation since 2011 and that has changed –

Sen. Rob Portman (R-Ohio):
Nobody threatened default because the President’s saying he wouldn’t negotiate –

Treasury Secretary Jack Lew:
And the President has said and he’s just repeated this week that he wants to and he’s prepared to negotiate. I think it’s important not to just go through a President’s budget and cherry pick the things that are hard for him to do. You have to look at the things that are hard for others to do. A negotiations is give and take. If everything is on the table, if we’re looking at entitlement reform and tax reform in a way that join together to solve the problem, there could be a serious conversation. But I’d just caution to not take one side of the ledger.

Sen. Rob Portman (R-Ohio):
…Because the President also says in that budget that he believes we ought to have tax reform, specifically with regards to corporate tax reform for the first time in your budget you indicated to be revenue neutral. And I applaud you for that as you know. I think that’s important. It’s an urgency right now. If we don’t deal with it we’ll continue to lose more jobs in this country.

My question to you would be – the President’s own proposals on entitlement – I agree there should be a give and take but I’m going to say let’s look at the President’s own proposals, putting those into this debt limit increase, plus directions to the Congress on tax reform as you all have suggested. Would you all be willing to move that forward?

Treasury Secretary Jack Lew:
Just to be clear. The President’s view on the debt limit – he has stated as clearly as he can – he’s not negotiating over the debt limit. The debt limit – Congress has to make it possible to pay our bills…


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One Comment on “Transcript: Senate hearing Q&A with Sen. Rob Portman & Treasury Secretary Jack Lew on the debt ceiling – Oct. 10, 2013

  1. Pingback: Debt Ceiling: Short-term Treasury yields nearly triples due to debt limit brinksmanship | What The Folly?!

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