Senate

MEMO: Republican Candidates And The Debt Limit

To: Interested Parties
From: Rodell Mollineau, President American Bridge
Date: 8/5/11
RE: Republican Candidates and the Debt Limit

This past week we witnessed the Republicans and their Tea Party allies play a dangerous game of chicken with our nation’s economy. They drove the economy right to the brink threatening to let our nation fail to pay its bills for the first time in history. And while eventually the Republican leaders came to their senses and agreed to raise the debt ceiling, what was truly frightening was how Republican candidates for both President and the Senate ran to the far right advocating either default or the dangerous economic policies, deemed “cut cap and balance,” that would have sent our economy right over the cliff.

Background:

All respected economic experts agreed we had to raise our debt ceiling and instituting the “cut, cap, and balance” would be a death knell to our economy.

“This would be an unprecedented event in American history. A default would inflict catastrophic, far-reaching damage on our Nation’s economy, significantly reducing growth, and increasing unemployment… Default would not only increase borrowing costs for the Federal government, but also for families, businesses, and local governments – reducing investment and job creation throughout the economy.” [letter from Secretary of the Treasury Timothy Geithner, 5/13/11]

 “It’s not just the federal government that’s facing a credit downgrade, now it’s the states. Credit analyst Moody’s warned that five states are in danger of losing their top-rated AAA credit ratings, just a week after both Moody’s and Standard and Poor’s issues a similar warning to the feds. Maryland, New Mexico, Virginia, Tennessee and South Carolina face downgrades because of their heavy reliance on federal revenue, the ratings agency said.” [Politico, 7/20/11]

 “It [balanced budget amendment] is about the most irresponsible action imaginable,” said Norman Ornstein, a resident scholar at the conservative American Enterprise Institute. “It would virtually ensure that an economic downturn would end up as a deep depression, by erasing any real ability of the government to pursue countercyclical fiscal policies and in fact demanding the opposite, at the worst possible time.” [CNN Money, 3/29/11]

“By requiring a balanced budget every year, no matter the state of the economy, such an amendment would raise serious risks of tipping weak economies into recession and making recessions longer and deeper, causing very large job losses.  That’s because the amendment would force policymakers to cut spending, raise taxes, or both just when the economy is weak or already in recession — the exact opposite of what good economic policy would advise.” [Center on Budget and Policy Priorities]

Yet, despite the facts that default would have been devastating to our economy, Republican candidates continue to spin unrealistic, economically dangerous rhetoric.

Presidential:

Michelle Bachmann – After declaring that she would refuse to support any compromise plan to raise the debt ceiling, Bachmann attempted to downplay the threat of default. “…though she’s confident that the country won’t default even without a deal. ‘I want to state unequivocally for the world, as well as for the markets, as well as for the American people: I have no doubt that we will not lose the full faith and credit of the United States,’ Bachmann said Thursday.” [Politico, 7/28/11]

Tim Pawlenty – “…Republican presidential candidate Tim Pawlenty paused to meet with voters and set about trashing the debt ceiling agreement signed by President Barack Obama on Tuesday. The former Minnesota governor called the last-minute framework ‘very disappointing’ and faulted Congressional leaders in both parties for not doing enough to confront the underlying federal debt crisis. ‘They didn’t fix the problem,’ … He also rallied the audience with the misleading claim that ‘most of the cuts they proposed are going to come from defense.’” [CNN, 8/2/11]

Mitt Romney – After his absence from the debt ceiling discussion drew criticism from even his fellow GOP Presidential candidates, Romney waited until the deal was already agreed to before indicating “I personally cannot support this deal.”  [Mittromney.com, 8/1/11]

Florida Senate:

Adam Hasner – “Tonight the House is voting to add at least $7 trillion to America’s debt over the next ten years. There will be good conservatives on both sides of this vote, but I oppose this plan because it falls woefully short of putting America on sound financial footing.  It doesn’t come close to meeting the conditions necessary to avoid a downgrade to America’s best-in-the-world credit rating and it leaves the door open for massive tax hikes. There is no strict requirement for a Balanced Budget Amendment or strong, across-the-board spending caps tied to the size of the economy. Furthermore the plan will not restore confidence in America’s job-creators or job-seekers, which is exactly what our nation needs the most at this critical time.” [Hasner Campaign Facebook Page, 8/1/11]

George LeMieux – “If I were in the US Senate today, I not only would have voted against this debt deal, I would have continued fighting for the meaningful spending reform that our nation critically needs.” [LeMieux Campaign Website, 8/2/11]

Missouri Senate:

Todd Akin – “Akin’s vote was no surprise given his professed doubt about a default crisis if today’s deadline was missed. In addition, he wanted an agreement that tied an increase in the debt ceiling next year with passage of balanced budget amendment to the Constitution.” [St. Louis Post-Dispatch, 8/2/11]

John Brunner – “But mid-Tuesday, a spokesman for Brunner said he is against the bill. ‘He opposes the plan as it does not come anywhere close to addressing the enormity of the problem,’ said spokesman John Hancock.” [Politicmo, 8/2/11]

Sarah Steelman – “Whenever the President and leaders of both parties are excited about a deal that creates a ‘framework’ for addressing the debt, I know that we are in trouble… Now is the time to stand firm and start cutting spending and shrinking the size of government. I would have voted no.” [Sarah Steelman Official Campaign Statement, 8/1/11]

Montana Senate:

Denny Rehberg – Voted against debt ceiling compromise while calling for balanced budget amendment [Rehberg Release, 8/1/11]

Nebraska Senate:

Jon Bruning – State Attorney General Jon Bruning said he continues to favor ‘a required balanced budget amendment, additional cuts and caps on spending.’  Bruning said the agreement ‘does not address the larger issue of reforming how Washington spends our tax dollars and finances its excesses.’”  [The Lincoln Journal-Star, “Republican Senate Candidates Oppose Debt Reduction Plan,” 8/1/05]

Deb Fischer – “I would vote no on this specific bill because Congress needs to pass a balanced budget (constitutional) amendment first.”  [The Lincoln Journal-Star, “Republican Senate Candidates Oppose Debt Reduction Plan,” 8/1/05]

Don Stenberg – “‘I would vote no,’ State Treasurer Don Stenberg said, citing ‘no real assurance of future spending cuts’ along with the lack of a requirement that the proposed constitutional amendment be submitted to the states…Stenberg said he doubts the proposed $2.2 trillion debt reduction plan is large enough to protect the nation’s triple-A bond rating.”  [The Lincoln Journal-Star, “Republican Senate Candidates Oppose Debt Reduction Plan,” 8/1/05]

Nevada-02 Special Election:

Mark Amodei – “I do not support a proposal that raises the debt ceiling… The president and other Democrats need to understand that any solution must balance the federal budget and include a balanced budget amendment to the Constitution. It cannot raise taxes, it must reduce spending to acceptable levels as recommended by Moody’s and other investor agencies. And it must enact safeguards to require government to live within its means by enacting spending caps indexed to population.” [Las Vegas Review Journal, 7/28/11]

Nevada Senate:

Dean Heller – Despite voting against the compromise deal, Heller told the Las Vegas Sun, “First and foremost, we’ve got to be happy that we raised the debt ceiling … I think it was good news that we raised the debt ceiling, good news that we didn’t close down 41 percent of the government,’ he said. ‘I’ll give credit where credit is due … but at the end of the day, I’ve got to judge whether that final deal is something I can support … in this deal, I really do think the bad outweighed the good.” [Las Vegas Sun, 8/2/11]

Ohio Senate:

Josh Mandel – “U.S. Senate candidate Josh Mandel, who’s currently the Ohio treasurer, would have voted against the $2.1 trillion debt-ceiling legislation that will get President Barack Obama’s signature later today. Mandel, a Republican, favored an approach called Cut, Cap and Balance — which could not pass in the Democrat-controlled Senate.”  [Plain Dealer, 8/2/11]

Cleveland Plain Dealer: Josh Mandel’s opportunism [8/3/11]

Utah Senate:

Jason Chaffetz – Despite lauding Speaker Boehner’s efforts, Chaffetz voted against the compromise deal.  [The Hill (blog), 8/1/11]

Orrin Hatch – “But I regret to say that I will not be able to support this proposal because it does not sufficiently provide us with the solution to the debt crisis that the markets are demanding.”  [Hatch Senate Press Release, 8/2/11]

 Virginia Senate:

George Allen – “‘After months of pushing our economy to the brink, Washington has yet again failed to deliver a long-term solution to our debt crisis,’ said Republican frontrunner George Allen. ‘This 11th hour deal fails to address the country’s serious fiscal problems, has no concrete Balanced Budget Amendment, and punts the tough decisions to yet another commission while adding nearly a trillion dollars more to our nation’s debt as they deliberate. ‘” [Augusta Free Press8/1/11]

Washington Post: An early flip-flop for Senate candidate George Allen [8/3/11]

Jamie Radtke – “Calling it a ‘debt deal sugar rush,’ Radtke said that ‘our leaders could not resist, and they struck a deal that provides a temporary and deceptive feeling of relief.’ Radtke, who did not support increasing the debt ceiling, said the deal ‘will most assuredly cost us our AAA credit rating and, consequently, impose severe economic pain on all Americans.’” [Richmond Times Dispatch, Virginia Politics Blog, 8/1/11]

Missing from all that rhetoric? Real solutions that address our long term debt situation by making smart investments now to get Americans back to work. With the debt ceiling debacle behind us, the American people are ready for Republicans to stop the radical grandstanding and work with Democrats to boost economic growth.