bentsen

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NO FUNDS FOR THE TREASURY (House of Representatives - December 14, 1995)

Mr. BENTSEN. Mr. Speaker, earlier today the House debated H.R. 2621, a bill which would, in my opinion, force a default of the U.S. Treasury on U.S. debt and forestall payment, not only of principal and interest on U.S. debt for the first time in our history, but also forestall payments on Social Security, Federal and military pensions. In fact, this bill was advertised as one which would protect Social Security and Federal and military pensions, but in fact, the end result would be causing a default and leaving the Treasury with no funds whatsoever to pay those payments to the beneficiaries who have paid into those systems.

During the debate, I referred to a speech which Speaker Newt Gingrich made before the Public Securities Association on September 21, 1995, just earlier this year. In this speech is where the Speaker plainly and clearly advocated defaulting on U.S. debt in order to force the President and the Nation to accept his budget and no other budget.

My assertion was called into question by my colleague and friend from Michigan, and therefore, I submit for the Record and ask unanimous consent to include the following article from the New York Times as printed on September 22, 1995 entitled `Gingrich Threatens U.S. Default if Clinton Won't Bend on Budget.'

Mr. Speaker, let me quote a couple of excerpts from this article. The article starts out:

[Page: H14907]

House Speaker Newt Gingrich threatened today to send the United States into default on its debt for the first time in the Nation's history to force the Clinton administration to balance the budget on Republican terms.

The article goes on to say:

Clearly, part of Mr. Gingrich's autumn end-game strategy is to force the White House to accept much of this agenda, many parts of which President Clinton has vowed to veto, by holding an increase in the Federal debt limit hostage. Without an increase in the Federal debt, the government will be unable to meet many of the payments due in November for Social Security, military pay, and interest on the Federal Government's $4.9 trillion debt.

Such confrontational techniques have been used in the past, but it has been highly unusual for a high government official or high government leader to suggest, as Mr. Gingrich did today, that default on government payments was not beyond the pale.

Let me quote directly from the Speaker. As we would say, the Speaker speaks. `I don't care what the price is,' he said in his speech. `I don't care if we have no executive offices and no bonds for 60 days, not this time.'

What that means, Mr. Speaker, is if we had a default and we had no bonds and we were not able to roll over the debt, that would mean that the Government would run out of money, and what that would mean is when Social Security checks need to be sent out, the Government would not have any money and the Government would not be able to take the Treasury securities, which Social Security invested in, and reinvest those into the market to raise capital. So in effect we would be high and dry; and unfortunately, the millions and millions of Americans who have paid into Social Security and count on that money to come every month would be high and dry, too.

Mr. Speaker, quite frankly, it is appalling, I believe, for this House to play with a time bomb such as the U.S. creditworthiness. We have a triple-A rating, and yet we have this revolutionary new Congress which believes it would be revolutionary to hold the country hostage and throw the Nation into default, to do away with our triple-A rating, to raise interest rates for all Americans, and to withhold the Social Security checks, the Medicare checks, the military checks, the pension checks to Americans who deserve those because they paid into them.

Let me remind my fellow colleagues of the House of the last revolutionary movement which decided to not stand up and pay its debts. It was the Bolshevik movement after the Russian Revolution in 1917, which refused to honor the Czar's bonds because, they said, `We have a new leadership here and we are not going to honor those.' Even today, people throughout the world hold those bonds and they are worthless. Even today, the Soviet Union, having broken the bounds of communism, has trouble entering the markets because of what happened back in 1917.

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