back in. getting all these materials and supplies transferred from one rrier to another. >> this is mission control houston, spacewalk preparations continue in the quest airlock. you see mike fossen's leading his way into the upper torso of his extravehicular mobility unit. not the easiest task in the world, but with the assistance of others on the left and atlantis commander chris ferguson on the right, he is now secured in the upper torso portion of the suit flexing his arms to make sure he is comfortable, and a good view from another camera in the quest airlock as you watch him on the right flexing their legs, part of this exercise protocol.

>> are you guys ready? >> born ready. >> born ready. >> the cover is open. attaching an anchor hook. >> ready to rock 'n roll? >> ready to rock 'n roll spirit let's go, buddy. time to go to work. >> we started out installing the new tools of the contingency operation tools onto the backside of the module platform. those went right into position. what a great team working together to get that designed, those tools worked flawlessly. the module hung up a bit on the external storage platform before we got it released. we gave it one more little try

with the bold. he gave it a little yank and the whole thing came loose. and you can see it starting to move. >> nice and easy. >> appreciate that. >> it's about 1500 pounds. so it takes quite a bit to move it. >> let's do it. >> 1400 pounds, buddy. [inaudible] >> here you see ron controlling the whole thing on the robot arm. notice he is very slowly turning the whole thing over. kind of a heads-up orientation and he needed to turn it 180 degrees when so that when he got down to the payload bay he would be had down to install the pump module when he got down there. >> now clear of external storage

platform number two headed down to atlantis is a little bit with the module will be secured on a trust support structure at the very back of the debate for the trip back home and then engineering evaluation to determine what caused the pump to fill on the night of july 31 last year. there are three spare pump modules residing on various locations on the international space station for use in the future, should another one go down. >> nice looking playstation you guys have your. >> thank you. >> mike fossum is preparing the worksite, and the nation structure, the trust basic at the back of the cargo bay of atlantis just above them is wrong holding onto the pump module and support attachment mechanism.

>> the pump module and its attachment mechanism now aligned to a comparable attachment mechanism on this trust at the rear of atlantis' cargo bay. >> you guys are good. >> tch is complete. >> thanks. >> breaks are on. you guys are clear. >> mike fossum has this robotic refueling mission in his hands. moving out of atlantis' payload bay. >> close encounter. >> you bet. >> here you see the robotic refueling mission just about to be installed and handed off to the dexter arm. i know that everybody is holding their breath you're making sure

that we are all sins and good wishes and we're able to get it installed just fine. it was off to install the material i s. as experiment, the small portion of that. took photos of that and material samples that are exposed to the ram and weight of space. from there we went on to work on the fixture that had the little wire sticking out through one of the latch doors. you can see it being cleared there and pulled out of the way. that went just like the training. it could not -- it was just like watching a training video to how well this went, just like we plan. it doesn't always go that well, but today it sure did and we're glad to see it. our final task on the eda was installing the thermal cover. here you see it coming out of the bag. think of it as a great big comforter coming out of the replacement bag. here you can see it in its final

configuration strapped down. it has straps that hold it into position. about the time they had it installed in this configuration, the thermal officer in the front room at mission control center stood up and turned around and said i can already see it starting to take effect. that's a very successful proje project. >> there were a lot of teams whose hard work all came in to play. a magnificent team of people. had to do it the hard way with ron and i, with ron and me traveling a lot, and not even in countries the same time together. they had to work hard. a well integrated plan put together. with all of the products and pieces that really came together.

to figure out how to get that thing back. a whole lot of work by a lot of teams around the country, and really came together and made a big difference. >> the hatch is closed. ♪ i'm a rocket man ♪ rocket man >> good morning, atlantis. this is elton john. we wish you much success on your mission and huge thank you to all the men and women at nasa who worked on the shuttle for the last three decades. >> good morning, houston. that is absolutely fantastic. we are absolutely honored that you took the time to join the crew this morning and wake us up. >> the spectacle of yesterday's six hours 31 minute spacewalk by

mike fossum and ron jeremy has morphed into what is essentially a blue-collar day for the 10 member on board. what this lies with all about and that is namely the transfer of almost a years worth of supplies from atlantis cargo module am a the raffaello multipurpose logistics module that was attached on monday to the earth facing port of the international space station through the use of the station's robotic arm. >> ron garan is continue to work on the waste and hygiene compartment which is the station's toilet. he is swapping out some air hoses and some other components of that particular device. >> that's the great thing about spaceflight. one day you are doing the most outrageous thing humans have ever done, spacewalking. the next day you are fixing toilets.

♪ if you believe they can put a man on the moon ♪ ♪ man on the moon. ♪ >> we wish you much success on your mission, and thank all the women and men at nasa who have worked for three decades. from birth a good morning to you. >> as you can see, a variety of crew members gathering down in the mid deck of atlantis to prepare a variety of cuisine that constitutes the all-american meal that you have been hearing about. this all-american meal again was conceived in honor of this final shuttle mission of atlantis and prepared by the food lab folks here at the johnson space center. the cruise all-american menu beginning with crutches, brie cheese and sausage. featuring grilled chicken, southwest corn and baked beans. apple pie for dessert.

the station crew also have argued brisket as its entrée. >> i'm telling you, i've done a lot of these interviews, a few from space, that technology now is amazing. the picture, guys, you look like you're in a studio may be in omaha, nebraska, or something. the shot is so clear. is this a hoax? are you really in space? >> yes. i don't know, we'll have to do something for you. >> the hair? >> i want to do it. spent i can do that. watch this. >> and everybody float around? that was really cool. look at her. >> that is so cool. >> i think sandy's hair is pretty much a dead giveaway. >> that is. there is a pose for you right there. ♪ good day sunshine may not. >> good morning, guys.

wake up. this, your last mission. well done. >> houston, thank you for that message. everyone around the world loves paul mccartney's music. spent atlantis, please stand by for the white house. >> hello? >> hello, this is the international space station. >> this as president obama. who am i talking to? >> hello, mr. president. you are talking to the increment 20 crew and the crew of the space shuttle atlantis. >> that's funny. i was just diving out for pizza, and i didn't expect to end up in space. >> yes, sir. it's an honor and privilege that you took time out of your busy day to meet with a. >> listen, it is wonderful to talk to you. and i appreciate you guys taking

out the time for your mission. i always want to just let everybody know how personally proud i am a and the amazing feature guys are a publishing in space. i was here in the over office -- oval office watching guys take off friday. we are all watching as the 1080 work together as a team to conduct spacewalks and manage experiments and do all the things that are necessary to keep the space station coming. your example means so much, not just to your fellow americans, but also to your fellow citizens on earth. and the space program has always embodied our sense of adventure and exploration and courage, as you guys work in a really harsh environment. and i know that there have been thousands poured their hearts and souls into america's space shuttle program over the last three decades that are following this journey with special

interest. into them and all the men and women of nasa, i want to say thank you. you helped our country lead the space age. you continue to inspire us. and captain ferguson, i realize you're a veteran, a previous flights but it must be pretty special to be the command on the last flight of the historic shuttle program. >> absolutely, mr. president. and just let me say on behalf of all of the international partners aboard the international space station right now, we are actually honored and privileged to represent our home countries in this multinational effort. and and to your question, sir, yes, it is an extreme pleasure, just a part of this fine crew of four who will represent our country on the final space shuttle mission scheduled for and undocking here in just a few days and a landing at the kennedy space center in a little less than a week. ♪ good morning, atlantis.

>> and good morning to the atlantis space into. thank you for that lovely greeting. >> houston, air ground. >> good evening, sandy. go ahead for transfer. >> okay. i show everything complete, and it's actually full. all full of foam. we are full. >> hats off to you and your crew. you guys have done an outstanding job. of course, there's a little bit left to do for tomorrow, but that's nothing compared to the job you guys have already dumped. >> it definitely was challenging but everybody pitched in, of course. as i mentioned before, we had a great play. you guys did a great job.

the folks at ksc and keeping track of all a small things, it would have been a nightmare for us but it really did go smoothly for all that we are working hard. and we can't even tell you how much we appreciate all the work you guys did on the plan. >> i can honesty say we enjoyed it, in some weird way. >> totally understand. >> good morning, atlantis. have a great day. [cheers and applause] ♪ ♪ >> home of some of the hardest working people who make incredible things happen. we thank you. we look forward to another great day in space. >> houston, we have gathered

everybody here at the forward hatch. we have a couple different things would like to do today. the first of which is a special presentation, and that presentation is a special flag. that flag was handed to me personally just a few days before launch, and the crew of sts-135, the final shuttle mission brought to the international space station. since we have been your we prominent display the flag on the flight deck. we had it there earlier for public affairs event, but doug and i, rex and sandy, we just really like it. it symbolized what we are all here for, and we left it there probably. and i think it made us feel good. we had that flag and that flag is significant not all because we brought it up on this flight but because it also flew on sts one. this flag represents not just a symbol of our national pride and

honor, but in this particular case it represents a goal. this flag also would be flown prominently here by the forward hatch to be returned to earth once again by an astronaut that launches on a u.s. vehicle. hopefully in just a few years. >> atlantis, station, station is ready for undocking spent atlantis, copy. >> physical separation houston. >> houston, copy. undocking confirmed. >> at 1:28 a.m. central time atlantis weighs anchor from the international spacinternationalr the last time. 12 and a half years of shuttle missions to build and service a million pounds complex at an end.

>> atlantis departed the international space station for the last time. >> thank you for 12 doctor missions to the iss and for capping off 37 space shuttle missions to construct both orbiting facilities. we will miss you guys. godspeed, soft landing, and we will see you back on earth in the fall. >> thanks, ron. into the station commander on board, we appreciate your hospitality again. it's got a right to stand back and for just a moment to admire and take pride in its work. from our unique advantage point, we can see in a space station as a wonderful accomplishment. enabled many nations to be one in space. the iss not interest the air of utilization. we will never forget the role space shuttle played in its creation. from the men and women who build operate and live there.

from this unique vantage point we can see a great thing has been accomplished. so, iss, make us proud. >> a few minutes after atlantis reaches the point, 650 directly in front of the station, the international space station will begin a maneuver of 90 degrees under the control of russian thrusters. that maneuver will occur while atlantis is in a period of about 27 minutes of stationkeeping directly in front of the complex. once the station has the odd to the proper orientation, doug hurley will begin a 600-foot radio fly around and a half lap around the complex by magnus and rex walheim gives digital cameras with high-powered lenses to snap away, collecting imagery of the launch of the station, its modules and its components. >> -- and atlantis you a happy to know you it just as good from the site as you do from the from. >> thank you. not sure how to answer that one,

but thanks spent almost directly above the international space station, you can see the varying views of the solar rays that are angled through the assemblies optimize solar array absorption of sunlight to be converted into electricity on the far right of the access of the space station. that is the harmony module in the horizontal position, basically as you look at this view. that's where atlantis was docked to. on either side of those two large modules, the european space stations columbus laboratory, and on the topic comment as you look at this you from directly above the space station is the large japanese segment of the complex, and its external experiment platform. >> i ss atlantis on the big blue. we are essentially complete with our fly run. we should have a good view.

i'm not sure when we'll break out of the big loop but it is anytime soon we wanted to give you a final goodbye to. >> thanks. we will be watching you from the windows. you guys looked really good from the fly around from what we can see. >> again, thanks so much for all you guys have done for us up here. we really, really appreciate it. >> hey, fergie, from mission control room in houston we want to let you know that it's been a pleasure and honor to support this, the 37th mission of the space shuttle of the iss. we are proud to be the last in a countless line of mission control teams that had the honor to watch over the iss while discovery and endeavor and atlantis have visited over the last 13 years. we have watched and support as the shuttle has enabled the station to grow from a humble single module to a stunning facility that is so large that some astronauts had even

momentarily gotten lost in it. you can take it from me, so of course the iss wouldn't be here without the space shuttle, so why we have the communication link up for the last time, we wanted to say thank you and farewell to the magnificent machines that delivered, assembled, and staffed our world-class laboratory in space. so, fergie, chunky, sand and rex, get her home safely and enjoy the last couple days into space shuttle atlantis. ♪ ♪ >> three, two, one. we salute you. [cheers and applause] >> good morning, houston. and to the great folks in the space center who have cared for these vehicles for the last 30 years, a special good morning to

you. >> chris ferguson, command of the final mission of the thirty-year space shuttle history, i want to ask you, what do you see as the future of the american space program? >> we were discussing this just the other day, you know, and it seemed like sort of an ending. and i suppose to a degree it is. the space shuttle has been with us, it's been the heart and soul for about 30 years. it's a little sad to see it go away, but we have to understand the systems to operate and maintain our extraordinarily costly. and in order to go beyond, because in order to go below low-earth orbit we have to pause and have to stand down and we will have to channel some of those resources that we used to fund and operate the space shuttle so that we can build another vehicle. we are going to go beyond again someday. hopefully it's in the not too far distant future.

we will turn this business to commercial companies. but hopefully in the not-too-distant future you will see heavy-lift vehicle manufactured by our commercial partners, designed by nasa in partnership and we will go back to the moon, back to mars. so the future is very bright. but at the moment it's a little somber because we are saying goodbye to an old friend. >> sandy, if i could just post this last question to you. what is your message to the thousands of people over the years that have been such an instrumental part of the shuttle program? and say goodbye to this program after 30 just. >> really the heart and soul of the space program is the people that work in the space program. it's a group of people unlike any other, the field i guess, because everyone is so passionate and so dedicated. they work so hard. they take a two-hour. it's true, all the people i've met in the united states who have worked in various aspects, it's also true of the people who i've met in other countries to work with the international

space station. there's a huge number of people worldwide who passionately believe in spaceflight and dedicate their lives to it. and it's because of these people that the shuttle program was so successful for the last 30 years and we were able to do the amazing things were able to do. it's because of these people the international space station has been so successful, and will continue to be successful. and this same group of people will carry forward the momentum and get us out of low-earth orbit to these other designations that rex was talking about earlier. >> fergie, it's time for us to bid you goodnight. i think i speak for everyone in the room when i say we all feel very privileged to have been a part of the 135 team would do. also, speaking for everyone really in the space shuttle program that we are so proud of how you have represented as really to the whole world on this final shuttle mission. your professionalism and excellence have been really the best kind of tribute to the space shuttle, and many people who are part of its history so

we will bid you goodnight, safe travels, and we will see you back in houston for the celebration. >> megan, thank you. that was really very kind of you. and, you know, 42 years ago today neil armstrong walked on the moon. and i consider myself fortunate that i was there to actually remember the event. i think that there's probably a lot of folks in that room who didn't have that privilege or honor. and i can only hope that that day will come for them, someday. it's kind of interesting to be on the final night of the shuttle mission. we are just trying to take it all in. i tell a quote that i thought was really good, and is really appropriate on this, the 42nd anniversary of the united states is present on the moon, and that's i pray that our nation will someday find the courage to accept the risk and challenges

to finish the work that we started. i bid a farewell to you. i don't think we're supposed to see you tomorrow. i hope you don't, and let's just plan on this being, being our final shift. and we go out the door, like i said, to orbit one, take a look back at the mission control room and make a memory. good night from atlantis. ♪ ♪ god bless america ♪ my home sweet home ♪ god bless america ♪ my home sweet home ♪ good morning atlantis.

the wake of music this link was for the entire crew, and it was also for all the men and women have put their heart and soul into the shuttle program for all of these years. >> thanks. what a classic, patriotic song. for what will likely be the shuttles final orbit, and thank you, thank you to america for supporting this program. and we will see you on the ground here in a few short hours hopefully. >> completing our tv coverage of the final mission of the space shuttle program. our coverage will continue on

our website at c-span.org. the u.s. senate is about to gavel in to start their day. lawmakers will take up h.r. 2560, house republican debt and deficit reduction plan known as the cut, cap and balance bill. that measure passed in the house earlier this week by a vote of 234-190. a procedural vote to move the bill forward in the senate is tentatively scheduled for this coming saturday. once an agreement is reached all the vote early. and now to live coverage of the u.s.a. and here on c-span2. -- the u.s. senate here on c-span2.

the presiding officer: the senae will come to order. today's opening prayer will be offered by reverend sphep, senior pastor -- reverend simeon spencer, senior pastor of the union baptist church in trenton, new jersey. the guest chaplain: let us pray. creator god, we bow with thanksgiving for the privilege d

call of service given the lawmakers of our great nation. we are awed by the grace that brings us all to this place and the gravity of the work with whh these elected officials have ben entrusted. in the wonder of such grace, we confess now with humility the limits of human knowledge, the frailty of human ability and the finitude of human ways. and so, in these moments we petition you, the all-knowing fr understanding; the all-powerful for strength; the everlasting to everlasting for endurance. we pray that you will equip both the members of this body and the who advise them, with the giftsf your spirit, so that the work which brings them here might be executed in a manner worthy of your holy name, bring honor to e memory of those who have served before them and inspire trust in those who have sent them. we wait now in hope for the fulfillment of faith that "they

that wait upon the lord shall renew their strength; they shall mount up with wings as eagles; they shall run and not be weary; and they shall walk and not faint." these things we pray in your grt name. amen. the presiding officer: please join me in reciting the pledge of al legiance to the flag. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. the presiding officer: the clek will read a communication to the senate. the clerk: washington d.c., july 21, 2011. to the senate: under the provisions of rule 1, paragraph 3, of the standing rules of the senate, i hereby appoint the honorable tom udall, a senator from the state of new mexico, to perform the duties of the

chair. signed: daniel k. inouye, president pro tempore. the presiding officer: the majority leader is recognized. the clerk will call the roll. quorum call:

mr. mcconnell: mr. president, are we in a quorum call? the presiding officer: yes. we are. the republican leader is recognized. mr. mcconnell: i kwurt that further proceed -- i request that further proceedings under the quorum call be dispensed with. the presiding officer: without objection. mr. mcconnell: the senate will begin debate today on cut, cap, and balance, the plan approved earlier this week in the house.

this means that senators will now have the opportunity to go on record either in support of balancing our books or against it. this is an opportunity for everyone to take a stand. it's an opportunity to say that a government which borrows more than 40 cents of every dollar it spends is not sustainable and very much needs to change its ways. it's an opportunity to stand with those who believe that washington needs to heal its addiction to spending now. not make more false promises of spending restraint some time later. the president's veto threat of this legislation is telling. many of us learned a long time ago to pay more attention to what this president does than what he says. and anyone who witnessed his reckless spending habits over the past two and a half years or sat across the negotiating table with him over the past few weeks could be forgiven for being skeptical of his recent attempts

to come across as a fiscal moderate. i'll just say this. there should be no doubt in anyone's mind that this president is as deeply commited to a government we can't afford as he was on inauguration day. that's why we've decideed to bring our case directly to the american people with the cut, cap, and balance plan which forces washington to get its fiscal house in order with a constitutional amendment. it's nice that some people are hoping the president had a change of heart, but no one should be planning on it. cut, cap, and balance cuts spending now, caps it in the future and only raises the debt ceiling if it's accompanied by a constitutional amendment to balance the federal budget. that is what america wants, and it's what washington needs. all we need is 20 democrats to join us. at least 23 of them have led their constituents to believe they'd fight for a balanced budget amendment. the white house has called for a balanced budget approach in this

debate. this bill doesn't just suggest balance, it actually mandates it. so i strongly urge my democratic friends to join us in supporting this legislation. let me just note in closing another virtue of the cut, cap, and balance plan, it doesn't raise taxes. why is this a good thing? well, there are many reasons americans don't like tax hikes. first, they know government is bound to waste the money. second, americans have seen what government does with new tax revenue. they waste it on things like turtle tunnels. second, they never use it to pay down deficits and debt. so if you're concerned about the size of our debt and raising taxes is a sure way to ensure that nothing gets done about it. absolutely nothing. the reason we've got a debt crisis is that government spends every cent it gets and then some. sending washington more money will not solve the problem. it will enable it. our tax system certainly isn't

perfect, but until washington can prove it is responsible with our tax dollars, we shouldn't be sending it more of those tax dollars. that is why republicans have focused on cuts in this debate and that's why every one of us, democrat and republican, should support cut, cap, and balance. mr. president, i yield the floor. the presiding officer: under the previous order, the leadership time is reserved. the clerk will call the roll. quorum call:

mr. barrasso: mr. president? the presiding officer: the senator from wyoming is recognized. mr. barrasso: i ask that the quorum call be vitiated. the presiding officer: without objection. mr. barrasso: thank you. i come to the floor today as i have just about every week since the health care law was passed with a doctor's second opinion about the health care law. i have great concerns about the law that was forced through this senate, and i come to the floor today because it seems that the more americans find out and learn about this health care law, the less they like it. a majority of americans now in national polls say they want out. they absolutely want out. you know, since october of 2010, the administration has granted waivers -- waivers -- to unions, to businesses, to insurers and to actually whole states because they can't afford the health care laws burdensome mandates. the secretary of health and human services continues to

release more waivers; did so again last friday. and they have now granted over 1,471 annual benefit waivers, limit waivers. and this has covered 3.2 million americans. and that's why i come to the floor today, mr. president, and introduce a bill that will allow every american -- every american -- to apply for a waiver from the president's health care law. under my bill, any american can submit a waiver application seeking relief from any or all of the health care laws mandates. and all that those americans will have to do is simply show what unions and what corporations have shown in order to get their waivers. nothing more, nothing less. waivers will be granted to individuals who show that the health care law is either increasing their insurance premiums or decreasing their access to benefits. all they have to show.

now, so far this administration has ignored most americans' demands for a way out of the health care law, and americans are looking for a way out of it. instead, this administration has granted half of the waivers -- half of the waivers -- to people who get their health care law through unions. those people represent a very small percentage of the workers in america. they got half of all the waivers. it is neither fair, nor is it reasonable. you know, these are the same unions, mr. president -- the same unions who lobbied for and supported the health care larks but now that they've actually read it and found out what's in it, even though it's been passed -- too late now; we thought too late -- but they've been getting waivers so they don't have to live under the mandates of the health care law and we're talking ug about unions about the service employees international union. you know, this is what they said about the health care law. these are people that lobbied for the health care law.

now they've found out what's in it and they say, "it would be -- to live under it, would be financially impossible." a union who lobbied for the health care law, now they say "financial impossible to live under it." well, it doesn't just afly that union. it applies to americans all across this great land. so i don't think any americans should have to bear financially impossible costs because of the law. the financially impossible mandates and elements of this bill have absolutely become more obvious to more americans as they've taken the time to look at the rules and the regulations. and that's why, frankly, this steady drip of waivers coming out of the health and human services, giving waivers to many of their friends, has become such an embarrassment for this administration and why they actually recently abruptly changed the rules. in june, the centers for

medicare and medicaid services announced that all employees and organizations who can't afford the law's crushing mandates -- and there are many -- must jump through new set of hoops. used to be you'd get a one-year waiver. now all employers and organizations, even those who've already gotten a waiver, must apply by september of this year for long-term waivers. the long-term waive letters awl last all the way -- will last all the way until 2014. instead of ending the waiver proficiency the administration should extend the waiver process to include all americans. that's what my bill does. not just -- families, organizations of all sizes will soon be hit with these crushing mandates. under the administration's current plan, employers will be forced to provide $750,000 worth of coverage to every employee this year. by next september, that number balloons to $2 million, and beyond that there is no limit.

it continues to go higher and higher. so if you're an employer and you can't afford $2 million in coverage next year, you better aplay for your waiver before -- apply for your waiver before september of this year. otherwise you'll be stuck with costs that only get higher and higher. so this to me is what the administration wants to do because they don't stwoonts put out waivers in 2012, an election year, which is going to cause additional attention to how unpopular this health care law continues to be. now, let's talk about some americans who get together, people in any community, in my state and your state, mr. president, and want to start a new business. thinking about starting a new business after september, thinking about do we do it this summer, do we wait until the fall? if these people want to start a new business and hire people and want to start that business after september, they're going to be faced with two difficult choices: they can offer high-cost government-approved health insurance, what the health care

law says, making it very expensive for them to try to open a new business, to hire new workers, put america back to work. we're at a time when there's -9d boy 2 unemployment in this cufnlt or these people can refuse to offer coverage at all, refuse at all because they can't afford the health care law's sky-high mandates. so the incentives in the health care law will encourage businesses to do what? well to drop insurance coverage if they're providing it right now. your honor the law, businesses are permitted to drop out of paying for employer-provided coverage as long as they pay a fine. the fine is going to be $2,000 for an employee. the fine is far smaller than the exploding costs imposed by the health care law. so i think this explains, mr. president, why the keynesian company recently reported that up to 50% of employers are expected to stop providing employer-provided health care coverage.

the employees that are dumped? what happens to them? they'll be forced to get their insurance through an exchange run by washington which is heavily subsidized by the american taxpayers. they are going to be dumped into the exchange and the annual cost of subsidizing these ballooning number of insurance policies, by my calculation about $900 billion. that's nine times higher than what the white house has claimed. in short, the taxpayers of this country will be stuck with a bill of nearly $1 trillion every year. well, i'm going to come to the floor every week, continue to fight and repeal this health care law with patient-centered care -- patient-centered care that lowers costs for all americans and improves their care. i'll continue with the second opinions. because until we are able to repeal and replace the health care law, i'm going to move forward with what is now the "waive" ablght. this bill offers all americans the freedom to choorks the

freedom that has been taken away from them by the president's health care law. mr. president, it gives thesm the trite seek and be granted a waiver out of the president's health care law and it is time to transfer power from washington back to the american people. this will ensure that they can get the care that they need from the doctor that they want at a price they can afford. thank you, mr. president. i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll.

mr. reid: mr. president? the presiding officer: the majority leader is recognized. mr. reid: i ask unanimous consent that the quorum call be terminated. the presiding officer: without objection. mr. reid: firs first mr. presid, i ask that madge thee levy be granted privileges of the floor during the dur traiftion today -- during the duration of today's and tomorrow's session. the presiding officer: without objection. mr. reid: objection. mr. reid: the time until

2:00 p.m. today will be divided with the republicans controlling the first 30 minutes and the majority controlling the next 30 minutes we'll have a full debate on this bill over the next few days. i hope that we can accelerate the time on this. if people feel we've debated it enough, i hope we can move to some other matter. mr. president, first let me get this off my chest. coming in here today -- i just heard there is an announcement in the house of representatives that they're take the weekend off. i've reached out to the speaker. i haven't had an opportunity to speak to him. but i want everyone that can hear my voice to understand that time is of the essence. we are running out of time. procedurally things can't move very quickly through the senate. under the best of circumstances. and when there are people who want to cause problems it takes a long time to get things done. there are people who serve in the united states senate that say they do not believe and they

will fight to make sure that we do not raise the debt ceiling, that in fact they're saying, let's default on our debt. i think this is a very bad picture for our country to have the house of representatives out for this weekend when we have to likely wait for them to send us something, because i understand that negotiations taking place deal with revenues which constitutionally have to start in the house of representatives. so i think it is just untoward -- and that's the kindest word i can say -- for the house of representatives to be out this weekend what. a bad picture that shows the country. we have 12 days left before our nation does the unthinkable, forever undermining the full faith and credit credit of our country. all members of congress, we come from 50 states but we all serve one nation.

we stake out our own positions. the american people expect us to find common ground no matter how difficult it may seem. every reasonable voice in america has warned us that defaulting on this nation's financial obligations would not only be a blight on our reputation but precipitate a global economic crisis that we have never, ever seen. these warnings that come from the banking industry and the business community. they come from our finest economists and shrewdest investors. they've come from former legislators and past policy-makers, both democrats and republicans. and they've come from reasonable people here in our congress. it's clear to me that we have to increase the debt ceiling. that's what john boehner, the republican speaker of the house said this spring. but, mr. president, it is now summer. he also said this:

"not raising the debt limit would have a serious, serious implication for the worldwide economy and jobs here in america." that's the speaker of the house of representatives. his deputy, eric cantor, agrees. last week canter said, we want to make sure that we avoid default. we want to make sure would this awe avoid going past august 2 without raising the debt ceiling. close quote. my republican counterpart here in the senate, the senior senator from kentucky, said he would support the debt limit as long as congress use the opportunity to do -- quote -- "something really important about the national debt." mr. president, democrats are willing to join with our colleagues from the other side of the aisle to do, as my republican counterpart said, something really important. we've already shown our willingness to make tough decisions for the sake of finding common ground, even if it means drawing the ire of our

own political peamplet unfortunately, the loudest, shrillest voices in the republican party are not reasonable leaders but tea party extremists. congress has days, not weeks, to reassure the markets that when this great nation issues an i.o.u., we stand by it, we don't turn into a deadbeats when the bills come due. if you want to know how important this issue is, ask ronald reagan. here's what he said said about e pons of averting this kind of default. "the united states has a special responsibility to itself and the world to meet its obligations. it means we have a well-earned reputation for reliability and credibility, two things that set us apart from much of the world." president reagan took the threat of default seriously, because i repeat what he said, "the united states has a special responsibility to itself and the world to meet its obligation. it means we have a well-earned

reputation of reliability and credibility, two things that set us apart from much of the worl world." so he did, president reagan took the threat of a default seriously. so do reasonable members of congress today. and this is reasonable republican members of congress. yet i fear the closer we get to disaster, the further we get from make the arrangement to stop a default. democrats have shown they're willing to work with republicans on any serious plan that averts default and cuts the deficit in a balanced way. now it's time for house republicans to show they're also willing to get serious. a plan that would disseminate social security, medicare, and every other federal benefit plan while protecting hundreds of billions of dollars in special interest tax breaks is not a serious plan. the republicans so-called cut, cap, and balance plan doesn't

have one chance in a million of passing the senate. the moment for partisan games has long since past. it is time for patriots on both sides of the aisle to join hands and actually govern. so i ask, will reasonable republicans join us in forging compromise for the good of our country? mr. president, i now move to proceed to calendar number 106, h.r. 2560. the presiding officer: the clerk will report. the clerk: motion to proceed to the consideration of calendar number 106, h.r. 2560, an act to cut, cap, and balance the federal budget. the presiding officer: under the previous order, the time until 2:00 p.m. will be equally divided and controlled by the two leaders or her designees with senators permitted to speak therein for a period of up to ten minutes each, with the republicans controlling the

first 30 minutes and the majority controlling the next 30 minutes.

a senator: mr. president, is the senate in a quorum call? the presiding officer: the senate is not. mr. thune: mr. president, i would rise today to speak to the issue that the senate is going to be considering now for the next couple of days and ultimately voting on, it sounds like possibly some time on saturday, and that is the cut, cap, and balance proposal that has been put forward by the house of representatives. the house passed this particular proposal the night before last. it is now pending under consideration in the senate. and what i would suggest to my colleagues in the senate is this: it is the only proposal out there. it is the only plan that we have to vote on. we've had now over 800 days, 813 i think is the correct number of days now, 813 days since a budget was passed in the united states senate.

the democrat majority has not submitted one for consideration here. we've not had votes on a budget. so we've been operating without a budget. the house of representatives, on the other hand, passed a budget earlier this year. it was criticized by many people here, democrats, as being something they didn't want to support, but there wasn't an alternative put forward by the senate democrats nor by the president. the president did put a budget forward in his annual budget release earlier this year, but when the senate voted on that they voted it down 97-0. there wasn't a single member of the united states senate, republican or democrat, who voted in favor of the president's proposal. why? because it raised spending. it raised the debt, almost doubled the debt over the next ten years. and increased taxes by over $1 trillion. those are all elements you don't want to have in a budget when you have a down economy. you want to get spending under control, reduce spending. you want to put a plan in place,

getting a trajectory in place that would start reducing the amount of debt we have as a nation. you don't want to raise taxes in an economic downturn when you're dealing with 9.2% unemployment. that's the only budget submission that we have seen from the president. and as i said, there hasn't been anything in the context of this debt limit debate put forward by the democrats here in the senate or the president. so the only proposal we have in front of us is the cut, cap, and balance proposal that was passed by the house of representatives and sent to the senate. you can say that the house arguably has done its work. they've done their job. they have put forward a plan that we need to act on. but to suggest for a minute that there isn't an alternative, the republicans are being unreasonable in all of this, i think completely misses the point, mr. president, because it is the only plan out there. if you don't like that one, where is your plan? where is the budget. we've been 813 days without a budget. we don't have a plan dealing

with the senate democrats. what we have to consider and debate today is the cut, cap, and balance proposal. that's significant for a number of reasons. one, i believe that the way to deal with the crisis that we have in this country today, a debt crisis that gets worse by the day, is to get spending under control. i believe fundamentally, mr. president, the problems we have in this country is not a question of not enough revenue. it's a question of too much spending. government has gotten too big it, has grown too fast. it is spinning out of control, i think, in the minds *f most americans, and they want to see us rein it in and get government spending and debt under control. i read yesterday on the floor, but i want to read it again. ironically a letter i got from a boy scout are in south dakota who was earning his merit badge. he wrote me a letter and he said -- quote -- "i feel the federal government needs a balanced budget. if we don't, the debt gets larger each year. i feel there are two solutions

for this. in our house, we are careful to only spend what my mom and dad earn. that needs come first and what is left is for wants. many times we were told no when we asked for s-fplgt with my allowance and lawn mowing money i donate it between saving and spending. i can't spend more than i make. end quote. i think there are a couple of very powerful observations in that statement, mr. president. the first is obviously that it's not lost on even this young american how important it is that you live within your means, that you can't spend money that you don't have. that's clearly a lesson that he has already learned that we need to learn here in washington, d.c. secondly, it's how profoundly this issue impacts the next generation. if in fact we fail to act to get spending and debt under control and to put us on a sustainable fiscal course, the next

generation is going to pay a powerful price for our irresponsibility. and i would submit again to my colleagues, mr. president, that this is fundamentally a spending issue. a lot of folks have talked about the need for more revenue. the president talks about wanting more revenue. the majority leader got up and just said the house is out of town and how that's terrible because revenue measures have to orpblg ridge educate in the -- originate in the house of representatives. many of us believe this can be solved without more revenue, that we don't have to raise taxes on the american people or american small businesses to solve what is inherently and fundamentally a spending problem. if we want to balance our budget, it means we've got to get spending under control. there have been five times since 1969 when the budget was balanced in this country. in each case the average amount that we spent was just under 18.7% of our gross domestic product. that's the benchmark

for the five times in our nation's history since 19 *69 when the budget has been balanced, 18.7% of g.d.p. the 40-year average of spending to g.d.p. in this country is 20.6%. that's the 40-year average. five times when we balanced the budget it was 18.7% of g.d.p. what are we spending this year? 24.3% of g.d.p. and if you look at the president's budget -- and i think even what are, in my view, optimistic smudges about economic -- optimistic assumptions about economic growth, you're still looking at that sort of a course for the forseeable future. what i think are going to be exploding costs of the health care bill passed last year, i think it's going to be much higher than that. my point simply is this. if you can balance your budget at 18.7% federal spending as a percentage of g.d.p. and we are spending at 24.3% this year, we are 30% higher in terms of what

we spend than those times in which we were able to balance the budget. so it's clearly, in my view, if you're talking about getting your budget balanced, it means getting spending under control, reining in out-of-control washington spending. now i've argued for a long time that we need not only what is proposed in the cut, cap, and balance bill in terms of an immediate reduction in spending. caps on spending in the future years, but also a balanced budget amendment to the constitution, something i campaigned on my entire political career. why? because i believe it is so necessary. washington has not demonstrated in the past the political courage that's necessary to get spending under control. and as a consequence, we now have a federal debt that's over $14 trillion, and we're actually talking about raising the borrowing authority of this country simply because we get further and further into debt.

every year we're running $1 trillion deficits. at that rate you're obviously going to continue to accumulate enormous amounts of debt. it means getting your budgets balanced. we don't do that around here. most states do. there are 49 states that have some kind of balanced budget amendment that requires them to make sure their spending does not exceed the amount of revenue coming in. i think that's needed here. when i first got to the congress as a freshman congress in 1997 there was a vote on the balanced budget amendment. it failed by one vote. it has to be sent to the states for ratification. if 38 states ratify it it would be an amendment to the constitution and we would have at that requirement that the federal government balance its budget just like so many states have to do every single year. that vote in the senate in 1997, it failed by one vote. it got 66 votes here in the senate, one short of the 67 necessary to send it to the

house. at that time i was a member of the house of representatives. had the senate passed it and it went to the house, i believe we wo* have gotten a two-thirds majority in the house and been able to send it to the states. that was 15 years. what has happened since then? at that time the cumulative debt was $5 trillion. today it is $14 trillion. i can't help but thinking had we had a balanced budget amendment in place how much better off we would be today. the cut, cap, and balance approach, mr. president, strikes at the very heart of the issue. and that is that this is a fundamentally, a spending issue that needs to be addressed in the near term by cutting spending this year, capping spending in future years and putting in place that mechanism that enforces or requires congress to have the discipline that's necessary to balance the budget for future generations. mr. president, i hope we will get an he -- an affirmative vote when that time comes and my colleagues will join me in supporting a measure that i

think will get this country back on a supportive future track. mr. president, i yield the floor. mr. president, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

the presiding officer: the senator from north dakota is recognized. mr. conrad: are we in a quorum call? the presiding officer: yes, we are. mr. conrad: i ask further proceedings under the quorum call be dispensed with. the presiding officer: without objection. mr. conrad: mr. president, i rise today to discuss the legislation that's come over from the house of representatives that i must say i consider some of the most ill-considered legislation that i've ever seen come over from the other body. this legislation has been hastily thrown together, never had a hearing, and yet proposes

to amend the constitution of the united states in dramatic and draconian ways. mr. president, this is truly dangerous business. i have been part of the fiscal commission. i was part of the majority that supported its conclusions to reduce our debt from what it would otherwise be by $4 trillion. 11 of us supported that plan, five democrats, five republicans, one independent. i have been for the last six months an active member of the group of six, three democrats, three republicans. we've reduced -- released our plan to reduce the debt from what it would otherwise be by $3.7 trillion. i've been part of putting out the democratic senate budget committee plan. i am proud to say it would reduce the debt from what it would otherwise be by $4

trillion. i have spoken in my entire career, 25 years here in the united states senate, of the dangers of deficit and debt. the risk of the debt threat to our country. i believe passionately that we've got to find a way to come together to reduce the danger of these runaway debts. but, mr. president, this legislation that has come over from the house cannot be the answer. it is not bipartisan. it is superpart safnl superpart. it is totally done on one side of the ledger. and, mr. president, it will not pass, it will not become law, and it should not. now, let's understand the context within which we're operating. first of all, as a country, we are borrowing 41 cents of every

dollar that we spend. our gross debt is now 100% of our gross domestic product. the best economists in the country have warned us that once you get to a debt that's more than 90% of our gross domestic product, your future economic proces-- futureeconomic prospec danger. that's, why mr. president, i have been deeply involved in every serious bipartisan attempt to reduce deficits and debt. but this proposal that has come over from the house, not having had a single hearing in this body -- not one, is truly radical. mr. president -- again, i say to my colleagues, we have an urgent need to act. but we shouldn't panic.

and, unfortunately, i think that's what the house did when they sent us this half-baked concoction of ideas that don't hold together, that don't add up, and that would actually further threaten the economic recovery. there is no denying that we face a debt threat. this is what the chairman of the joint chiefs said in june of last year. "our national debt is our biggest national security threat." and now we have had the rating agencies warn us that if we don't act, if we go doo get our debt and deficits under control, they're going to downgrade u.s. debt's rating -- the rating of u.s. debt, the rating of how the markets respond to our debt offers. that would have a very serious

impact on what we pay to borrow money. and, remember, for every 1% increase in the interest rates we pay, it adds $1.3 trillion to the debt. here's what the rating agencies have said. "we may lower the long-term rating on the u.s. by one or more notches into the aa category in the next three months if we conclude that congress and the administration have not achieved at that credible solution to the rising u.s. government debt burden and are not likely to achieve one in the foreseeable future. " mr. president, that's why i joijoined the group of six some sixes month ago to produce a bipartisan plan to deal with the debt threat. and we've released that plan now. three democrats, three republicans, many more of our colleagues on both sides have joined, have said they're with

us. and so we've got a way forward. but it's certainly not the legislation that has come over here that we're considering today from the house of representatives. this legislation would restrict the ability to respond to economic downturns and actually compound declines. it uses social security funds to calculate balance and subjects that program to the same cuts as other federal spending. even though we all understand that's totally separate from the rest of the budget. and it shifts ultimate decisions on budgeting to unelected and unaccountable judges. what a mistake that would be. and it requires a state ratification process that could take years to complete. we don't have years to deal with this problem. i'm afraid that this is mostly

political theater that has been sent to us, rather than a serious response to the problem. perhaps most alarming, the proposal that is before us could turn a recession into a depression. mr. president, we need to think very, very carefully how we respond to this debt threat, and then we need to react in a serious and credible way, and we've got to stand together with our colleagues. that's why i was proud to be a part of the fiscal commission, because we produced a plan that would get our debt under control and start reducing it, and there were 11 of us -- five democrats, five republicans, and one independent -- a majority of that commission that agreed to that plan. and it's why i've been proud to btobe part of the group of circumstance three dernlings

three republicans, to begin to control our debt and work it down. mr. president, none of those plans and none of the other bipartisan plans would risk turning a recession into a depression. but that's exactly what the legislation from the house would do. why do i say that? well, here's one of the most respected scholars in this town, from the american enterprise institute. he called the balanced budget amendment that has come from the house "a really dumb idea." this is what he said. "few ideas are more seductive on the surface and more destructive in reality than a balanced budget amendment. here's why: nearly all of our states have balanced budget requirements. that means when the economy cellulose, states are forced to raise taxes or slash spending at just the wrong time, providing a fiscal drag when what is needed

is countercyclical policy to stimulate the economy. in fact, the fiscal drag from the states in the 2009-2010 period was barely countered by the federal stimulus plan. that meant the federal stimulus provided was nowhere near what was needed but far better than doing nothing. now imagine that scenario with a federal drag instead." mr. ornstein doesn't just imagine that. "the washington post" in an editorial from last friday said, "rewriting the constitution is the wrong way to deal with the debt." let me just reference in their second column these words. "worse yet, the latest version would impose an absolute cap on spending as a share of the economy. it would prevent federal expenditures from exceeding 18% of the gross domestic product in any year.

most unfortunately, the amendment lacks a clause letting the government exceed that limit to strengthen a struggling economy. no matter how shaky the state of the economy, no matter how shaky the state of the union, rather, policy-makers would be prevented from adopting emergency spending such as the extension of unemployment insurance and other countercyclical expenses that have helped cushion the blow of the current economic downturn." mr. president, two of the most distinguished economists in our country -- alan blinder, the former deputy chairman of the federal reserve, and mark zandi, who was an advisor to john mccain's presidential campaign -- studied the government response to the latest financial crisis. here's what they concluded:

"we find that it's effects on real g.d.p., gorks and inflation are huge and probably averted what could have been called great depression 2.0." this amendment before us would have stopped the governmental response which two of the nation's most distinguished economists tell us averted great depression 2.0. when all is said and done, the financial and fiscal policies will have cost taxpayers a substantial sum, but not nearly as much as most had feared and not nearly as much as if policy makes had not acted at all. if the comprehensive policy responses saved the economy from another depression, as we estimate, they were well worth their cost." mr. president, this amendment that is before us now would have

prevented this response, would have prevented averting a great depression. mr. president, here is the work of zandi and blinder with respect to what would have happened to jobs absent the federal response. jobs with the federal response, the green line; jobs without the federal response, the red line. eight million fewer jobs without the federal response to prevent a depression. mr. president, unemployment, what would have happened without the federal response? according to this detailed study by sudan dip and blinder, without the federal response -- by zandi and blinder, without the federal response unemployment today would be 16% instead of the 9% we're

experiencing. we would be in a depression. mr. president, that is the hard reality, and the amendment before us would have prevented that kind of governmental response. now, mr. president, they call this plan cut, cap, and balance. they should have called it cut, cap, and kill medicare, because that's really what this plan would do. it would cut, cap, and kill medicare. why do i say that? well, if we look at the house budget proposal that underlies this plan, we see what happens under traditional medicare. under medicare now, the beneficiary pays 25% of their expenses. under the republican budget plan that underlies the amendment that's come before us, medicare beneficiaries would pay 68% of

the expenses of their health care. in other words, somebody who is medicare eligible, qualifies for the program, pays their required costs, pays their required co-pays, pays their required premiums, currently pays 25% of the cost, under the plan, the republican plan from the house, that would increase to 68% over time. that stands medicare on its head. instead of medicare as normal insurance does, paying the lion's share, the individual would pay the lion's share of their health care expenses. mr. president, the underlying house republican plan that underlies this amendment would increase the out-of-pocket costs to a medicare beneficiary from

$6,000 to $12,500. that would be health spending for a typical 65-year-old medicare beneficiary in 2022. instead of paying $6,000 under current law, they would pay $12,500. now, somebody who's been following the details will look at these numbers and say, well, senator conrad, what you've outlined there is the house republican plan, and what's been sent you in an amendment actually is even more draconian than the house republican plan. it goes even further. it cuts medicare even more. and, yes, mr. president, that's true. i have understated very substantially the devastation that would be done to medicare under the amendment before us.

how can that be? here's how it can be. here is the red line shows the spending under the house g.o.p. budget. but in this amendment, in this legislation that has come to us, not only do they adopt the house republican budget, they then trumpet, they then override it with a constitutional amendment that goes even further. so here is the spending under the house republican plan. it goes from 24% of g.d.p. down to 19.9%. then it's leapfrogged by the provisions of the constitutional amendment that would take spending down to 18% of g.d.p. from 24.1% to 18%. that's a 25% cut if you took the cut across the board.

but their plan doesn't take the cut across the board. it shields certain things. and so the cuts to those things that aren't shielded have to be more draconian and even deeper. mr. president, just visually, i thought i should produce a chart that shows what would happen if you had to reach the limit that is in the constitutional amendment that is before this body today. with an 18% cap on all gross domestic product spending, here's social security. that's 5% of gross domestic product. defense and other nonhealth spending, as you can see, over 15%. it takes you to well over 15%. then you've got interest, and you're at their cap.

there is no money for medicare. there is no money for medicaid. there is no money for any of the other health care accounts. if they just hold harmless social security, defense and other nonhealth spending, and of course we've got to pay interest on the debt, there's nothing left over. that's why i call this cap, cut, and kill medicare. i should have added cut, cap, and kill medicaid. cut, cap, and kill every other health care account. mr. president, this plan caps spending going forward at draconian and unrealistic levels. it fails to account for the retirement of the baby-boom generation and rising health

care costs. perhaps more remarkable, it provides no war funding for 2013 to 2021. none. let me repeat that. this plan that has come over from the house is so ill considered, so hastily thrown together, so lacking in credibility that they provide for no war funding after 2013. does that mean they're advocating bringing all the troops home from every location everywhere around the world? i'm certain not because that's not the position they've taken. but they don't provide any money for it. mr. president, i don't know who slapped this thing together, but

they weren't very careful in what they did. none of it adds up. it is totally make-believe. mr. president, this is not make-believe. this is what's going to happen to the number of people who are eligible for medicare and social security running up to 2050. the number of people eligible is almost going to double. that is a demographic tidal wave that is a reality. it's not a projection. these people have been born. they're alive today. they're going to retire. they're going to be eligible. and this amendment before us makes no provision for them. so what's going to happen? they're going to shred medicare. they're going to shred medicaid. and they're going to put at risk social security. that's as clear as it can be.

mr. president, here's the reality that we confront today as a nation. spending as a share of g.d.p. is the highest it has been in 60 years. but revenue as a share of g.d.p. is the lowest it has been in 60 years. both these are facts. both these are true. and our friends on the other side are saying, you cannot touch the revenue side of the equation. even if it is closing tax havens, going after tax scams that proliferate the tax code today, they say, oh, no, you can't touch that. you can't make aepblg changes on the -- any changes on the revenue side of the equation even though the revenue is the lowest it has been in 60 years as a share of our national income. they say it would take a two-thirds vote and they would put it in the constitution of the united states that they would require a two-thirds vote to close any tax haven, any tax

shelter, any abusive tax scam. take a two-thirds vote. mr. president, that's not what i learned about when i was growing up about the constitution of the united states. it didn't say anything about protecting those who engage in tax scams and tax havens and abusive tax shelters. but that's what this plan would do. mr. president, "the washington post" back in may made an analysis how did we get in this ditch that we're in of runaway debts and runway deficits. their conclusion after this study was that the biggest culprit is an erosion of tax revenue. together the economy and tax bills enacted under former president bush and to a lesser

extent by president obama wiped out $6.3 trillion in anticipated trillion. that's nearly half of the $12.7 trillion swing from projected surpluses to real debt. federal tax collections now stand at their lowest level as a percentage of the economy in 60 years. and this amendment before us would require a two-thirds vote in order to do anything about it. mr. president, let's get serious. as i say, i've been part of every serious bipartisan effort here over the last two years to come up with a plan to get our debt under control. so, yes, cut spending. yes, reforeman entitlements. yes, to get the revenue base recovered so that we can reduce our debt. but, mr. president, this plan

before us is a disaster. now, let's look at reality. the last five times the budget's been in surplus in the last 40 years, revenue has been close to 20% of g.d.p. this plan would require a two-thirds vote to increase any revenue. and revenue is at 14.5% of g.d.p. wow! you talk about consigning this country to an endless round of economic uncertainty and an undermining of the economic position of the united states. vote for this thing. mr. president, martin feldstein, who is one of the most conservative kpwheufts in the

country -- conservative economists in the country, has said we've got to take on these tax expenditures. tax expenditures now amount to $1.1 trillion a year. we are spending more through the tax code than we are in all appropriated spending every year. and yet, this amendment would require a two-thirds vote to change any of those tax expenditures, to close any of the tax loopholes, to go after any of the tax havens, abusive tax shelters. mr. president, here is martin feldstein, professor of economics at harvard, chairman of the council of economic advisors under president reagan -- under president reagan. this is what he said: cutting tax expenditures is really the best way to reduce government spending. tax expenditures is really the

best way to reduce government spending. eliminating tax expenditures does not increase marginal tax rates or reduce the reward for saving, investment or risk taking. it would also increase overall economic efficiency by removing incentives that disstort private spending decisions and eliminating or consolidating the large number of overlapping tax-based subsidies. it would also greatly simplify tax filings. in short, cutting tax expenditures is not at all like other ways of raising revenue. close quote. and the interesting enough, every bipartisan commission has come back and said, as one part of dealing with our deficits and debt, we ought to reduce tax expenditures. it's just spending by another name. but, you know what? the legislation before us would

require a two-thirds vote to change any of these tax expenditures. mr. president, because it raises revenue, raises revenue. so their against that. -- so they're against that. here'here's where if goes. the top 26% get 26% of the tax -- the top 1% get 26% of the tax expenditures. these loopholes that have proliferated have gone to the very top, and we're going to have to reform this tax code, take out the junk, and we're going to at the same time go after these offshore tax havens and tax shelters that some of the very best-off among us, the most fortunate are using to dodge what they legitimately owe

in this country. you know, they call this legislation cut, cap, and balance. they should have called it preserve, protect, and defend tax havens and tax shelters. because that's in effect what it would do. they say, if you go after these tax havens, these tax shelters, that that's a tax increase; that increases revenue; therefore it would take a two-thirds vote to do anything about it. let me say to my colleagues, this is a little building down in the cayman islands, a little five-story building. it claims to be home to 18,857 companies. they all say they're doing business out of this little building. this is the most efficient building in the world. it's unbelievable. 18,857 companies say they're doing business out of this little building.

that is a remarkable accomplishment, to be running 18,000 businesses out of this little building. how can that possibly be? but, of course, it's not. the only thing they're running down there is a giant tax scam on all the rest of us who pay what we owe. we aren't down in the cayman islands -- by the way, it has no taxes this aply to these businesses -- that apply to these businesses. we're right here. we're filing our taxes and we're paying them. these companies are dodging theirs. mr. president, if anybody doubts that this has become a huge hemorrhage for the u.s. treasury, here's what our own permanent subcommittee on

investigations found. "experts have estimated that the total loss to the treasury from offshore tax evasion alone approaches $100 billion per year, including $40 billion to $70 billion from individuals and another $30 billion from corporations engaging in offshore tax evasion. abusive tax shelters add tens of billions of dollars more." mr. president, i tell you, before we raise taxes one thin dime on any of the rest of us who are paying our taxes, let's go after these folks who are dodging their responsibility and their obligations, and this amendment before us would require a two-thirds vote to do it. mr. president, that's not the end of it. the wealthiest 400 families in the united states, here's what's happened to their tax rates, their effective tax rates since

1995. in 1995, their effective tax rate was 29.9%. by 2007, it was down to 16.6%. the wealthiest among us have had their tax rates about cut in half. i don't know about you, i didn't have my tax cut in havment and a vast majority of americans didn't have their taxes cut in half. but with the help of well-placed lobbyists here, those who are the most fortunate have had their tax rates cut in half. mr. president, this amendment before us would say, it would take a two-thirds vote to change it. that's why i say this amendment should be called protect, preservings and defend tax havens and abusive tax shelters. mr. president, the last time the top rate was 39.6%, we

experienced the longest period of uninterrupted economic growth in u.s. history. those who say, you raise any revenue, you kill jobs -- really? that's not what history shows. the last time we had a comprehensive plan to cut spending and raise revenue to reduce the debt during the clinton administration, we kicked off the longest period of uninterrupted economic growth in u.s. history. 39 straight quarters of economic growth, 32 of those quarters during the clinton administration, and 24 million jobs were created. mr. president, dealing with the deficit and the debt in a balanced and comprehensive way doesn't kill jobs; it creates the climate for the creation of jobs. because it improves the competitive position of the united states. mr. president, i have been part of three plans to reduce this debt from what it would

otherwise be by $4 trillion. the fiscal commission plan -- i served, 111 of us endorsed that outcome. i was part of the group of six, we produced a plan to reduce the deficits and debt from what they would otherwise be by $3.7 trillion. i was part of the democrats on the senate budget committee that unveiled a plan to reduce deficits and debt from what they would otherwise be by $4 trillion. so i've been happy to be part of bipartisan efforts, part of efforts just on our side of the aisle, and interestingly enough, every single bipartisan commission has come up with a package of about $4 trillion in deficit savings. and the group of six did, i think, yeoman's work bringing the deficit down from 9.3% of g.d.p. down to 1.

9%. but, yes, we have revenue. and yes, we have spending cuts. and yes we reform entitlement programs. because all of that's necessary. this legislation before us says, whoa, wait a minute. we don't want to do it all. we want to do -- we want to focus on just part of it. this problem is too big to try to solve it with just part of the federal fiscal picture. it's going to take all parts to solve this problem. mr. president, the group of six, aim plowed to say, came up -- i'm proud to say, came up with a plan that stablizes this debt and begins to bring it down and avoiding this skyrocketing debt that we are otherwise going to experience. mr. president, this amendment, this legislation before us would stop it in its tracks. i think that would be a profound mistake. i hope my colleagues reject this ill-considered plan.

i thank the chair and yield the floor. mrs. hutchison: mr. president? the presiding officer: the senator from texas is recognized. mrs. hutchison: mr. president, i rise to speak in favor of the plan that is before us, the cut, cap, and balance act. and, mr. president, i also think there are some very important achievements in the group of six proposal. it's a proposal -- it's not in legislative language. it has many things in it that are very good. it has tax cut, it has entitlement reform, it has spending cuts. it is a complicated outline and one needs to be flushed out to know exactly what is in it. and it has some areas with which i disagree. i certainly want to is asure that we keep the 15% cap gain and dividends rate.

but we also have another proposal that i think has great merit, and i think the bill that has come over from the house, the cut, cap, and balance act, puts even more together to address the issues that we're all trying to address. what we need are spending cuts that are real, not proposed down the road or promised or we'll act on it later. and that's what the cut, cap, and balance act will do. we all know we have a $14.3 trillion debt ceiling that is getting ready to be hit sometime in the month of august. what we need to do in this senate, in the congress, and certainly hopefully the president is give confidence to the markets. now, that means we do two things: we raise the debt ceiling, we don't default or even scare

people that we're going to default, with reforms that will assure that we will not have to ever do it again. that is what we must do to send a message to the markets that we are going to get our fiscal house in order and we are going to assure that our debts are paid, that the people who work on federal contract contracts ir military, social security recipients will get their paychecks. we've got to assure the markets. to raise the debt ceiling, we've got to show that we are going to cut back on spending. that is the key. we've got to tackle the core problem. we've got to stop spending too much, borrowing too much, and taxing too much. we don't have a taxing problem in this country. we have a spending problem. we're not being taxed too little.

we are spending too much. with $2.2 trillion in tax revenue collected, the federal government has the ability to live within its means. we must prioritize and we must make sure that we get a private-sector economy that will hire people. and i can tell you that small businesses are not hiring because they are terrified of the health care bill that was passed year before last. they are terrified of the costs involved in that. and, secondly, they are looking at people in washington talking about more taxes, and they're saying, i am freezing right now, not going to take a chance that i'm going to have a new employee that is going to cost more than the productivity that we can add to our business and keep going.

so, the cut, cap, and balance bill would make significant spending cuts now. it also requires the passage of a balanced budget amendment to the constitution. now, that's the long-term. it takes a two-thirds vote of both houses to do that but we need to do it. we need to put the federal government on the same kind of fiscal constraints that almost every state in our nation has. and that is a constitutional requirement that we have a balanced budget, that we don't borrow, that we don't borrow for operational suspensions. we can borrow -- for owrptional expenses. we can borrow for long-term projects or bond, absolutely. but we're not going to borrow for our immediate needs. that is what kills the governments that overspend of which the united states federal government is one. we need to have the balanced

budget amendment that is in this bill passed knowing that it's not going to be an immediate fix because the states would have to ratify it. more than half the states will have to ratify a constitutional amendment. in that constitutional amendment, we have an 18% of gross domestic product cap on federal spending. because that will put our fiscal house in order. we know that's long-term, and certainly we want to get started on that long-term constitutional amendment fix because, once we do it, and once the states ratify it, and i believe they will, then we will have the ability to assure future generations that we will never be in the fix we're in now. today the federal government is spending 24% of g.d.p.

the 40-year average is 20.6%. sew we have a -- so we have about a 3% increase in the federal spending level that is juxtaposed against a gross domestic product. so if we put a spending cap of 18% in a constitutional amendment, we will have time to start drawing that down so that it won't be an immediate hit. in fact, the bill that is before us has a gradual decrease in the caps on spending. so, we have the constitutional amendment part -- that's the balance part. we also have a cap in the bill that is before us. and it's not an immediate cut to 18%, but it does ratchet down 21.7% in the year 2013.

20.8% in 2014, and so forth until we get to 2021 which would have a 19.9% spending cap on gross domestic product. so, it is a gradual cut between 2013 and 2021 in the cap on federal spending. i think that is a responsible approach, and that's why i am fully supporting this bill. that's the cap part. we have the cut part that is real cuts. we have the cap part that puts the lid on spending going forward. and then we have the balanced budget part which goes to the states and goes through our constitutional process to put us in the same situation that most states tph-r, and -- most states are in and that is with constitutional provisions that you have balanced budgets. one of the most valuable economic lessons that we have in

this country -- because we have learned from history -- is that you can't spend your way out of debt. that is the worst remedy that you would ever even think about. if you're a family in debt, you don't keep spending and you don't put a freeze on spending either, which is what was suggested in president obama's budget. he said, well, we'll just freeze at 2011 levels. but 2011 levels are inflated because of the huge stimulus bill that was passed; you've got an inflated level, and you say let's freeze there. no. we need to freeze at a lower level. we need to start ratcheting down the spending in this country in order to assure that we start going toward a balanced budget. the cut, cap, and balance act is

a reasonable way to cut spending now so that we will not have that debt ceiling lifted again because we'll start bringing down the stpeupt and not hit that debt limit again. so we bring down the deficits with immediate spending cuts. then we go forward with a cap that starts at 21.7% in 2013, knowing that we're at 24% now, you've got to have those immediate cuts to start getting down to the reasonable level. now, there's one more thing that we need to do that is not in this bill but is something that if we're going to have the long-term debt reduction, we've got to look at the entitlement expenditures. because our discretionary expenditures are roughly 20% of the total expenditures of our

country. so, we know that we are out of kilter right now in social security because the actuarial tables have not been kept up to date. when social security was passed, the average man lived to be about 60 years old. today the average man lives to be about 73, 77. we are going up, and thank goodness in life expectancy and the quality of life expect an seufplt if we're going to get our fiscal house in order, we need to address that. we need to have a very gradual increase in the retirement age. i have proposed a social security reform bill that does adjust the cola, and it also has a gradual increase in the age of retirement.

it stops at 69. some proposals are 68. you can keep going in that direction and try to assure that we are on an actuarial table that actually is today's correct actuarial table. the other thing that the gang of six, or the group of six did that i thought was very positive is it put everything tha*t depends on a cost-of-living adjustment in the federal budget on a different calculation that is determined by economists to be a more realistic spending gauge, and it is the c.p.i., the consumer product -- i don't know what "i" is. would the senator from tennessee remember what c.p.i. stands for?

it's consumer -- mr. alexander: index. index. mrs. hutchison: thank you very much. the c.p.i. is adjusted in the group of six proposal that will bring down the cost and will be a more realistic cola, cost-of-living increase. so it is very important that we look at that as one of the good parts of the gang of six or group of six proposal, because it puts it more in line with reality. and it also will save money on the other end on the long-term strategy that we must have to adjust our fiscal requirements to meet the needs and the revenues that are coming in. so with tax cuts that are also

in the group of six proposal that would help spur the economy, with the spending cuts that will bring our debt, interest requirements down, cost-of-living adjustments that are very minor but will have an impact over the long term, these are some of the good things that are out there. and let me just say in conclusion that we have had several of our leaders make proposals. we had senator reid and senator mcconnell put out a proposal. of course there were critics on all sides of that proposal. and then we had the group of six that came out with a proposal. and there were people who criticized that immediately. i think we need to take the nuggets of these proposals. there are some very good parts of the reid-mcconnell bill. there are some very good parts of the group of six proposal.

and let's don't kill off people putting forth ideas, because that's how we start coming too a conclusion about what is the best. and to criticize the people who have come forward with very bold plans, i think is a huge mistake, and i think it is unfair to those who have put something out to say, oh, that's a terrible plan and we would never vote for it. are you kidding? we need to come together with all of the plans. i'm supporting this one, the cut, cap, and balance plan, which i think came mostly from the house and some of our senators. it's very solid. i certainly think that senator reid and mcconnell didn't want to us come to august 1 and have no end game. and so they were preparing something that has some merit. they have a 302-a allocation in

there. that's basically a cap on spending. we need to have that. and that part of their proposal is very sound. and then the group of six has tax cuts as well as spending cuts and some adjustments in the mandatory spending side, the entitlements. we've got to have those ideas all on the table. and then instead of being negative about everything, let's take some of the good parts that we like and see if we can come to a consensus on those. so that's what we have to do if we're going to have an end result that will assure that our obligations are paid sometime in august when the true debt ceiling is hit. i think it's later in august. that's what is in conflict right now. but i think it's later in august. and if we're going to meet those

requirements that we have as elected members of congress, we're going to have to find some way to get there with the reforms that are necessary to give confidence to not only the people who hold our debt, but to the markets that would assure that our economy is not going to collapse either under the heavy burden of this debt. the reforms are a necessary element to lift that debt ceiling, or we will not be sending the right message to our debtors nor to the people who might start hiring and getting this 9.2% unemployment rate down. so, mr. president, i hope we can have a very strong, positive vote on the cut, cap, and balance bill. we need to address these issues. let's put it all together and let's start talking about what we have to do when that debt ceiling is reached. and this is a good start.

thank you, mr. president, and i yield the floor. a senator: mr. president? the presiding officer: the senior senator from tennessee is recognized. mr. alexander: thank you, mr. president. i ask consent to speak for up to 15 minutes. the presiding officer: without objection, so ordered. mr. alexander: thank you, mr. president. i congratulate the senator from texas for her remarks, her leadership, for her willingness to be involved in and support a variety of ways to help us meet 2002 goals we have before us, one of which is to make a significant step to reduce our federal debt, to stop washington from spending money it doesn't have. and, second, to do so in a way that honors the financial obligations of the united states of america, of the most credit-worthy country in the world. before i speak about the cut, cap, and balance act which has passed the house, which has 37 cosponsors in the senate -- i'm proud to be one of them. i think it's a superior piece of legislation. i hope when we vote on it it gets a majority of votes here in the senate and becomes law. before i do that, i'd like to speak for a moment about those two goals that are before us as

we, as we consider our debt, consider our financial obligations and consider all of them up against what is said to be a financial, a point on august 2 when the debt ceiling needs to be increased. and as i think about those two obligations -- reducing our debt -- those two goals: reducing our debt, honoring our obligations, i think about a friend of mine in tennessee who pays his bills out of a cigar box. now this is how it works. a bill comes in to my friend, and he puts the bill in a cigar box. and then another bill comes in, and he puts that bill in a cigar box. and then maybe the next week some money will come in. so my friend will reach down in his cigar box, and he'll pull a bill out, and he'll pay that bill. then if a little more money comes in the next week, he'll reach down and pull another bill out and pay that bill.

my friend pays his bills out of a cigar box. now what happens to my friend if he wants to go down to the local bank and say i'd like to borrow some money in order to pay all the bills that i have in my cigar box? i think what the bank certificate going to say, i'm sorry, my friend, but we're reluctant to loan money to you. but if we do, we're going to charge you more for it because we don't know who you're going to pay. you might reach down in your cigar store and pay the whiskey store nest bank. you might pay the grocery store instead of us. because you selectively pay your bills out of a cigar box, you're not a good risk. we're going to charge you more for your money or we're not going to loan you money at all. that's the risk we take if we play around with this idea of the united states of america, the most credit-worthy country in the world, selectively paying

its bills, going from being the most credit-worthy country to being a country that pays its bills out of a cigar box. there are three obvious reasons why we shouldn't do that. reason number one is it's going to cost us more. today the united states of america can borrow money for ten years at about 3%. we are so credit-worthy, people trust us so much to pay our obligations that they'll give us their money for a short period of time at no interest. it's a tremendous advantage to us. the united states has the risk-free credit in the world. and i might add the risk-free credit in an increasingly turbulent world. now, what if we decided after august 2, when we're told sometime in that month we'll begin not to have enough money to pay awful our bills, what --

to pay all our bills, what if we decided not to raise our debt ceiling and pay our bills out of a cigar box? we decided we don't have enough money so we'll pay china before we pay grandma her social security. better not do that. i saw a fellow in portland, tennessee, opbd monday and he said what's this about my social security not being paid? i said i think it will be paid. it might be two or three days. telephone calls will come in and it will be paid. he said it better not be five minutes. we might want to pay all of our social security benefits but the treasury secretary might say we'll pay grandma her social security but not the wife of a soldier in afghanistan. that's not such a good idea. maybe we won't pay the veterans benefit. we'll pay the idea. not such a good idea.

what about those 12 million to 15 million students head ofd to college in the next few weeks with a student grant or staopbt loan from the federal government?shall we pay those je public colleges take care of their own? you see what can happen if we had a country, especially a country like the united states, which instead of paying all of its obleses on time, whether it is to china or japan or grandma or to the veteran, that we begin to selectively pay those bills when we had the money. i think i know what would happen. instead of being able to borrow money for ten years at 3%, we might have to pay a little more for it. let's say it just went from 3% to 4%, what would mean to us? it would mean, according to the congressional budget office, that the taxpayers would have to pay $1.3 trillion more in interest over ten years.

so if it goes up to 5%, that's twice that. or it goes up to 3% -- that's what happens when you pay your bills out of the cigar box. and my son told me the other day, dad dad, my mortgage runs t in october. my interest rate might go up. let's say he has a $100,000 house loan and it goes up 1%. that's maybe -- that gets to be some money for him. or if it's 2%, or it's 3%. so if it's your credit card loan, your home loan, whatever loan it is, it will begin to go up. paying our bills out of a cigar box would raise our costs. there's a second obvious reason not to do this. in 2508 we were smacked in the face with a world economic crisis. we didn't expect it. most of us didn't cause it. but we had to deal with t here

in the congress we had to do some very unpopular things. we had to bail out banks, even some industries. the american people hated that, even though most of the money has been paid back. we don't know what we averted, probably a much worse problem. but we're still suffering. but we didn't do that deliberately. and n. this case, if we were to deliberately go from being the most creditworthy country in the world to a country that paid its money -- paid its bills out of a cigar box, we would be deliberately injecting our uncertainty into a turbulent world fl look at europe. when the eurozone trembling over the debt in portugal and the debt in greece, with sovereign nations having to bail out european banks. look at japan, the third-largest economy, in a ten-year recession with a third of its power plants closed after the tsunami, sweating through the summer with an inability to sell their

goods. look at china. china is a big success story. but it may be growing too fast. its inflation is up. it has a lot of unreported debt at the provincial level. look at our markets. we make trades in milliseconds and twice in the last year we've had sudden drops in the market which we couldn't explain for months. do we really want to inject this level of uncertainty into the world turbulence that we have today in the financial markets when we know that we can avoid it? i think not. then there is a third reason -- and this is a purely partisan reason; maybe it is not even appropriate to talk about on the senate floor, but let's talk about it for a moment anyway. the president has done a pretty good job of blaming his predecessors for problems, but lately people have said, mr. president, we don't blame you for the problems you inherited, but we do hold you responsible for the decisions you've made to make it worse. you've made it worse with the

health care mandates and higher individual health care policies. you've made it worse with the financial regulations bill. you've made it worse by not sending over the trade bills. you've made it worse with high-cost energy. you've made it worse your national labor relations board appointments and you've made it worse by proposing to double and triple the debt. people are listening and agree with that. what will happen if the democratic or republican party or any group of people have the primary responsibility for turning this country from a country that is the most creditworthy country in the world into one that pays its bills out of a cigar box? the president will say, instead of our saying, mr. president, you made it worse -- he will say, you made it worse. so, mr. president, there's every reason in the world to regard the debt ceiling decision that we have to make as an opportunity to make a significant step to reduce the debt, but we can do that while still honoring our financial

obligations, and we should. and today we're talking about one of those ways to do it. republicans have offered, with democratic cosponsorship in a number of cases, at least five major ideas for making a significant step towards stopping washington from paying -- stopping washington from spending money that it doesn't have. five ways to do that. there has been the corker proposal, which is bipartisan, which would over ten years bring our spending -- which is the real problem -- from its present level, about 25% of our total output in the country, to about 20%, which is the historical level. there is the balanced budget act, which is the most obvious solution to a nation that's spending more than it fakes in. -- than it takes in. families do it, state dozen it -- i mean balance their budgets, live within their means.

the federal government can do it. we can over time get back to the point where we were not many years ago where we spend about the amount of money that we take in. i know that as governor for eight years we did that. i know as a result of that we have almost no debt in the state of tennessee and as a result of that we can use our gas tax money, for example, to pay for roads instead of interest on the debt. then there's a fourth idea that has bipartisan support -- a third idea. that is the gang of six that came out this week. now, the president said it was a gang of seven, he thought i was in it, and i would have to say with respect, mr. president, i'm a law-abiding citizen. i'm not a member of any gangs. but i support what they do. because i think it's a serious, bipartisan effort to help stop washington from spending money thew it doesn't have. then there is another proposal that has bipartisan support that

republicans as well as democrats have initiated. senator isakson has taken the lead on it, the senator from georgia, and that is the two-year budget, which would allow us time every other year to focus on efforts on eliminating rules and regulations instead of adding so many. so there are four ways that we have suggested and in some cases with bipartisan support, that we can take a significant step to reduce our debt while still honoring our financial obligations. and today we're talking especially about cap -- cut, cap, and balance, the legislation that passed the house of representatives with 234 votes this week, has come to the senate floor. we're going to be voting on it in the next day or two. it has 37 cosponsors. i'm one of them. i commend senator lee for his work especially on putting this bill together, and in doing it in a way that would adrac attrae

largest amount of support. the cut part would say that for the first year we would spend a little less than we did last year. now, that's a reasonable proposal. in the state of tennessee, where i was once governor, the current governor is presiding ovesidinga state that's spending $1.5 billion less than it spent last year. they don't like to do that. there's some unfofortunate consequences for t they still balance their budget and getting along. they're hoping for the day when the economy recovers and they'll have more revenues coming in without raising taxes. so step one is to cut what we're spending today in next yiesh year's budget. then we cap. according to the economic output of the country over the next ten years, the amount we spend over those ten years. then the third thing is to balance the budget, the most obvious solution of all, over time, to say that we're not

going to spend more money than we have coming in. this is our proposal, to begin to control spending in a government that borrows 40 cents out of every dollar it spends, a government the economy -- the economists tell us is costing our nation a million jobs because of the high level of debt. this is an urgent problem. it urgently needs a solution. now, mr. president, in conclusion, almost all of us here in the senate are good at making speeches. that's one way we get here. but we've not become as good as the rest of our job, which is to get a result. the american people expect us to do that. they have to do that in their everyday lives. so they respect our principles, they respect our speeches. but they know our principles sometimes conflict. in the end -- in the end, we

have to have a result. we have to have a result here. we have to find a way first to significantly reduce the debt and second to do it in a way that honors the financial obligations of the united states, and i've suggested five ways -- five ways -- that we can do that. tcut, cap, andincluding cut, ca. in order do doe that, each of us have probably going to have to accept a part of the solution an idea that is not our first choice. but why should we be exempt from that rirnlt? -- from that requirement? that's what you have to do in a marriage that's what you have to do in a family, that's what you have to do in a business, that's what we had to do in creating the constitution years ago. this united states senate wouldn't exist if it weren't because of a grand compromise. otherwise how could you just two senators from wyoming and how could you justify the same number of senators from california, so much larger? so to get a result, after we

make our speeches, we need t toe willing to accept some ideas that are not our first choice. that is why i am a cosponsor of several different kind of ideas. cut, cap, and balance, the corker act, the gang of six proposal. that's why i support the isakson-shaheen effort on the two-year budget. that is the kind of attitude we need in the next couple of weeks. so, mr. president, cut, cap, and balance is a good way to meet our two urgent goals. take a significant step to reduce our debt and do it in a way that honors our financial obligations. we are perfectly capable as a country of fiscally disciplining ourselves. we are capable of reducing our debt, of stopping spending money that we don't have, and at the

same time avoiding turning the most creditworthy nation in the world into a country that pays its bills out of a cigar box. thank you, mr. president. i yield the floor. the presiding officer: the senator from new york is recognized. mr. schumer: i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. schumer: mr. president? the presiding officer: the senior senator from new york is recognized. mr. schumer: i ask unanimous consent the quorum be dispensed

with. the presiding officer: without objection, so ordered. mr. schumer: mr. president, i have 12 unanimous consent requests for committees to meet during today's session of the senate. they have the approval of the majority and minority leaders. i ask unanimous consent these requests be agreed to and these requests be printed in the record. the presiding officer: without objection, so ordered. mr. schumer: thank you, mr. president. now, mr. president, as we spend the day debating the republican plan to cap -- to cut, cap and kill medicare, a plan that is dead on arrival in the senate, it's become obvious what the true question of the day is. that question, mr. president, is: will we as a nation allow ourselves to be driven into default and financial calamity by a small group of extreme right-wing ideologues in the house g.o.p.? it has become increasingly clear that this group of ideologues has grabbed the reigns and are

refusing to let go, no matter who tries to pry their fingers off. it is clear that this uncompromising group of narrow ideological congressmen is the one thing standing in the way of raising the debt ceiling so that our nation does not default. it is the group who alone wants to drive the car off the cliff. we are now 11 days from defaulting on our debt, and for the last few months, this small group far outside the mainstream has contributed nothing to efforts to reach a compromise. the house g.o.p. has rejected every form of compromise, from the simpson-bowles plan to the president's $4 trillion grand bargain, to the mcconnell fallback plan, as of yesterday, to the gang of six framework.

instead, they have offered dangerous schemes like the cut, cap and kill medicare plan that passed the house yesterday. their "plan" would creek havoc on our country's seniors and on the middle class. it's not a serious proposal. it will never pass this body, and it's a waste of time. so while reasonable people are trying to come to a compromise, the house g.o.p. is becoming increasingly isolated. yesterday, for example, my colleague john mccain warned the house g.o.p. that americans don't want the government to shut down and urged them to learn the lessons of 1995. then close to a third of senate republicans signed on to a plan that would combine major spending cuts with new revenues, a balanced approach that the house g.o.p. has sworn off. and every day, more voters are

abandoning them. as the ""l.a. times"" reported this morning -- quote -- "republican existence to compromise has turned a significant block of voters against them, frustrated members of their own leadership as well as establishment g.o.p. figures." so the house g.o.p. is being criticized from every corner. and then today we have what must be the most significant departure to date from the house g.o.p.'s fantasyland. in a major development, antitax crusader grover norquist told "the washington post" that legged the bush tax cuts lapse would not constitute a tax hike. this is a development the significance of which should not be underestimated. it is a recognition from norquist that the house republicans are increasingly isolated and have painted themselves into a corner.

norquist is trying to signal to the house g.o.p. that their on no-compromise position is untenable, deteriorating and bad for their party and the country. the house g.o.p. is on an iceberg that is melting into the ocean and even grover norquist is offering them a lifeboat. the question is: for their own good and for the country's good, will they take it? i urge my colleagues in the house to accept this lifeline. it's time to leave default denier -- it's time to leave default denier island and come back to reality. the house republican extremists, those who are way over to the far right, painted themselves into a corner even to the right of grover norquist.

grover norquist, the hall monitor when it comes to enforcing the republican party's antitax pledge, has given house republicans a hall pass. they should use it. this is a coded message from one of the truest believers in the republican party that it's time for conservatives to step back from the brink. norquist has given us a potential path forward. if the -- if we decouple the bush tax cuts now by only extending them for the middle class and not for millionaires and billionaires, we could have the foundation of a deal that includes revenues but doesn't violate the norquist antitax pledge. this decoupling strategy is what the president and speaker boehner were entertaining earlier in the context of a grand bargain, but leader cantor and other right-wing hard-liners forced the speaker to walk away

because they feared violating the antitax pledge. but now a deal on decoupling seems to have norquist's permission, if not his blessing. we should revisit it. it's time to recognize the quickest, most effective and economically sound way to reduce our deficit and debt is a balanced approach that both cuts spending and raises revenues, a plan that mirrors every other successful deficit-reduction deal in our nation's history, a plan along the lines of the ones negotiated by presidents reagan, bush and clinton. i hope my colleagues in the house g.o.p. see the danger of the path they are going down and change course before they take the entire country down with them. mr. reid: will my friend yield for a question? mr. schumer: i would be happy to yield. the presiding officer: the majority leader. mr. reid: mr. president, i ask permission to ask my friend a question through the chair.

it's true, is it not, that you have served many years in the house -- that you served many years in the house of representatives? mr. schumer: 18 years, mr. leader. mr. reid: and you understand the difference between the procedures in the house and in the senate, do you not? mr. schumer: i do, some. mr. reid: and in your years serving in the house of representatives, you have seen how quickly things can move over there, is that right? mr. schumer: that is absolutely right. mr. reid: and coming to the senate, you have seen how slowly things have to move here in the senate, is that right? mr. schumer: indeed, i've learned that hard lesson. mr. reid: i say to my friend through the chair that i see what developing now is very, very bad for our country. it's hard to comprehend, i ask my friend this question, it's hard to comprehend how the united states house of representatives, at the height of this fiscal crisis we have, has decided to take the weekend off. are you aware they've decided to take the weekend off? mr. schumer: i have read that,

yes, i have. mr. reid: and it appears to me one reason to do that is to do indirectly what they can't do directly. that is, we have -- and i read them here this morning -- statements from my friend, the speaker, john boehner, saying we cannot default on our debt, from the whip over there, eric cant cantor, or majority leader, whatever he is, second in command, saying we cannot default on our debt. i'm saying to my friend from new york that it appears to me they're going to do indirectly what they can't do directly by not sending us whatever they decide to do in time to get it done. i think that the country is staring in the face a default on our debt because of the house of representatives being out this weekend. would my friend comment on that. mr. schumer: yes. and i think the leader has an excellent point here. to not be here this weekend, when the nation stares the first

default in our 200-some-odd-year history, is amazing to me that they would be gone. and when you think about it, either they don't care about defaulting on the debt -- and we know that speaker boehner does care about that default. i think he's aware of what terrible problems it would create for this country decades to come. so the answer must be what the leader is saying and that is they hope to jam us at the last minute with something and say, "take it or leave it," which is playing with fire. and i can assure my colleagues in the house that that's not how we're going to play ball here. there's got to be a fair compromise, not something that they come up with at the last minute and sort of toss it over here. that could create default. and if they do it, it would be on their shoulders. mr. reid: i say to my friend through the chair that they may send us something well-intentioned but i'm not

sure they understand the rules of the senate. there are a number of people who are republicans over here who have stated publicly they think the debt should be defaulted upon. and as the chair -- as my friend knows, most everything we do here is by unanimous consent. and if not by unanimous consent, by the rules of the senate, which are very strict and very difficult sometimes to comprehend, but they're there. and so i'm afraid that what is happening with the house leadership is they think they can send something over here and, as the majority leader, that i can figure out a way to get it done here. i can't get it done if we have to follow the rules, which we have to follow, and i can't get consent and i can't get consent on most anything i do around here. so i would like my friend to comment on that. i -- i appreciate my friend saying that speaker boehner is a good person. i agree with that. but i'm not too sure that this isn't an easy way out for

everybody over there, that they can say well, we did what we wanted to do and i'm sorry the senate couldn't do it so i guess our debt is defaulted upon and we'll close down all of the functions of this government and wait for a better day. mr. schumer: well, i -- again, in answering the leader -- and first, the rules of the senate would allow any single senator -- and we have a whole handful -- to delay things day after day after day after day. and, second, there are things out of the -- any senator's control. for instance, any proposal on an issue like this would have to be scored by the c.b.o.. we learned in the health care legislation that c.b.o. can't just sort of push legislation into a machine and an hour later say here's your score. it takes days and sometimes weeks. and the fact that just about every procedural motion can be filibustered and delayed means

that we're getting so close to the deadline that we would be in serious trouble. and, again, i'd repeat, i find it terribly disconcerting. it's hard to see the -- anything but callousness towards the danger our nation faces if we were to default by the house not being here this weekend. because even a rudimentary nofnlg the house -- knowledge of the house procedures, which i know the leadership of the house has, would indicate to them that if they don't get us something very, very soon -- and, in fact, if they don't sit and negotiate and compromise, which they've refused to do, driven by a hundred, perhaps, congressmen, many of them new here, who sort of say, "we don't care if we default." the consequences of default would be enormous and staggering and would not just go away in a

month or two but would be with us for a decade. and here they are back home this weekend when america faces one of the greatest potential economic crises that we've faced. so i very much thank the leader for bringing this up and asking these questions. mr. kerry: mr. president. the presiding officer: the senior senator from massachusetts is recognized. mr. kerry: mr. president, i apologize to my colleagues. i know this has been previously scheduled, and i know the importance of what the senator from new york is talking about and the majority leader, and i completely agree with their comments and would like to share some thoughts on that at another moment, but at this particular moment, mr. president, we are privileged to welcome here a great friend of the united states, the prime minister of

new zealand. john key. new zealand is a country that is in enormous partnership with us at this time, assisting in afghanistan, engaged in transpacific trade deliberations with us, and in many, many other ways contributing to one of the strongest and best partnerships we have on a global basis. therefore, i would ask unanimous consent that the senate stand in recess subject to the call of the chair so that colleagues might welcome the prime minister to the floor of the united states senate. the presiding officer: is there objection? without objection, the senate stands in recess subject to t

twitter.com c-span wj is how you can reach us. one of the headlines this morning. the deficit cutting plan too much too late. talks between various members. the government reporter can we first go on to the gang of 6 proposals? if from bloo bloomberg news. is that what they are thinking on capitol hill today? >> yes. the gang of six came out with their proposal.

it's fairly sweeping. i think there's a sense more among -- there's a sense among some lawmakers that they are trying to sign on to this. there was a letter that 33 senators had signed on to. the president seemed to give it some embracement earlier this week. there is a sense that this is something. they'll sigh this is something the scope of which could not be done in the next few weeks. what are the options as far as available to members now to come up with some type of plan by august 2. >> what is being discussed is whether there is a possibility of incorporating the gang of six proposal into a more short-term deal. that is something that can be

discussed now between the majority leader and what reid said on tuesday. he had asked mark warner to get back to him with suggestions of some el metropolitans of the proposal that might be able to be incorporated into a debt limit increase or at least set up even if it wasn't implemented right away or some of those elements. >> as far as the house is concerned, what kind of meetings have taken place overnight or in the last 24 hours and the advance of some type of deal being forged. the house speaker and majority

leader met with the president. not a sense of a lot of movement that came out of those meetings. there was an announcement that the house is probably not going to be in session over the weekend. the senate looks to be keying up for a vote saturday morning. unless there's an agreement to move up the vote, it looked like they were keying up a procedural vote to a senator: mr. president. the presiding officer: the senator from florida is recognized. mr. rubio: thank you, mr. president. i ask unanimous consent that i be recognized to speak for up to 15 minutes. the presiding officer: without objection, so ordered. mr. rubio: thank you very much. i was witness a few moments ago to an interesting and informative exchange and wanted to comment on that briefly.

both the leader and the senior senator from new york had some comments that i think are important in the context of what's being discussed here today, but i really wanted to come to the floor today because we have been get ago lot of phone calls and letters from people back home that are wondering what this is all about. these are folks that are out working every day and raising their families and running their businesses, and they want to really understand what the debate here is about. they get the gist of it that there is this debt limit fight and that congress if it doesn't do anything, we may not be able to pay some bills beginning august 2, but what really is behind all of this? the best way to explain it to people is to equate it to the lives of real people in the real world. every single one of us as adults has a credit rating. in essence, there are two or three companies out there that basically rate you as an individual. what they do is they give you a credit rating that determines, number one, whether you're willing to pay back and number two whether you have the money to pay people back. based on that, you get something called a credit score. people are familiar with that. every time you try to go lease or buy a car or a house, they will run you on credit. it will tell them this is john

smith, this is so and so, and this is his credit rating. based on that, people will decide whether to lend you money or not. well, countries have credit ratings, too. it's based on two things. number one is your history of paying people back. and two, on your ability to pay them back in the future. and there are three major companies in the world that give credit ratings to countries, three major companies. what those companies are saying right now is that we're looking at america and we are worried, we're worried about two things. they are worried about this debt limit issue and the fact that if the debt limit is not raised, they are going to downgrade us because we're going to miss payments on this, that or the other. they are worried about that. but they are a lot more worried about something else. it's not our willingness to pay back. it's our ability to pay back people that lend money to the united states. let me read you some of the quotes. this is from moody's which is one of the top ones. they write government will avoid -- the government avoids default, we will likely affirm america's aaa rating. america has the top, highest

credit rating in the world right now that you could possibly get. it says if we avoid default, they will likely affirm our aaa rating, but they will still assign us on something called the negative outlook unless there is -- and this is the money line -- substantial and credible budget agreement to cut the deficit. so what they are basically saying is if you raise the debt limit, you may temporarily avoid being downgraded but ultimately we're still putting you on a watch list and we're ultimately still going to downgrade you unless you have a substantial and credible budget agreement to cut the deficit. now, what does that mean? they go on to elaborate. they say the agreement should include deficit trajectory, basically a path of deficits that leads to a stabilization and ultimately a decline in your deficit, particularly in how much money you owe compared to how big your economy is. that's what they want us to see. what they want to see is they want to see a plan in place that shows how we stop growing the deficit and then how we start reducing it. that's what they're saying. and then they actually talk about specific numbers, and they have said, their analysts have

said we think $1.5 trillion of cuts this year over the next ten years is a plan that's too little. we think $4 trillion might be enough. that's from moody's. standard and poor's, the other rating company, they wrote very clearly that even if the parties -- meaning republicans and democrats -- even if they agree to raise the debt limit, it may not be enough to avoid downgrade. that's the second credit house. they are saying even if you raise the debt limit, we may still downgrade you. and in order to avoid a downgrade, you need a plan that reduces annual budget deficits by at least $4 trillion over the next ten years. we hear the $4 trillion number again. this is the second rating company basically saying yeah, the debt limit is a problem, but what we're really worried about is do you have a plan to deal with the debt and the deficits? and the third major company called fitch, they wrote we're looking for an agreement on credible fiscal consolidation strategy in order to secure america's top credit rating, the aaa. so the three major houses, which

is what this is all about at the end of the day, because if our credit rating goes down, interest payments go up on everything, from your mortgage, to your car, but more importantly on america's debt which means we're going to have to borrow more money just to pay the interest on the debt we already owe. so we can't allow our credit rating to go down, and the three major companies that give us our credit rating are all saying the same thing. here's what they are saying in plain english. the debt limit is a problem but it is the least of your problems. your bigger problem is the debt. if all you do is pass an increase to the debt limit and it doesn't come with a serious, credible, substantial plan to deal with the debt, you're in big trouble. and so i would submit to you that the biggest issue facing us on this issue is not the debt limit. the debt limit is actually the easiest issue. that's one vote away from being raised. our biggest issue is the debt, and the fact is that as we speak, there is no plan in place to begin to do anything about it. our credit is in danger because of this. and that's what we should be focused on like a laser. now, what will it take -- what

will a substantial plan look like? let's take it from the own words of these credit companies. it has to stabilize deficits and begin to show how the deficits come down. we know that $1.5 trillion in cuts is not enough. we know that $4 trillion might be enough. so this is what we need to do. so how do you do this? how do you get there? it's not rocket science. it's a pretty simple mix of two things that have to happen. the first thing you have to do is you have to stop spending money to rate your spending. you can't keep spending more money than you have. if you're in debt and you keep borrowing, a lot more money than you take in, especially, it's only going to get worse. so you have got to control the amount of money that you spend. and the other thing you have got to do is generate more money for government. so if you could do those two things, if you could control how much you spend and can you generate more money for government and you can do both things at the same time, that's how you dig yourself out of this, and the debate we should be having here is how do you accomplish that. and so on the -- on the don't spend side, we really have two

choices. you can either trust that future congresses will do what virtually no congress in the history of this nation has ever done, and that is control themselves -- and i say this because when republicans were in charge, democrats were in charge, they have never been able to control spending money. if you let politicians spend money that they don't have, they will spend it. i don't care who's in charge. that's what history teaches us. so we can either trust that somehow in the future, congress won't do that, or we can put into law limits on their ability to do that. and that's why -- that's why i'm for things like a spending cap and a balanced budget amendment because i think if you don't have restrictions in place, it isn't going to happen. almost every stay in the country has a balanced budget amendment. i come from a state where there is a balanced budget amendment. i assure you i don't care who is in charge or how conservative they claim to be. if you don't have laws in place that keep politicians from spending money that they are borrowing, they will borrow the money and spend it. and history will back that up. the second issue is how do you generate more money for this

controlled government? and that's the crux of the debate we're having here today. some of my colleagues believe the way you do it is you raise taxes, especially on rich people. to some people, that may sound appealing. here's the problem. it doesn't raise nearly enough money if you could even collect it. it doesn't raise nearly enough money. now, from the only tax plans that i have seen put out there by the administration and some of my colleagues here on the other side of the aisle, it adds up to less than ten days' worth of deficit spending. we do know, however, that these increases in taxes could kill jobs. the other way you could generate more revenue for government -- and it's the way i think we should do it -- is you grow your economy. you get more people back to work, and so now more people are paying taxes. you get people that are working to make more money because their businesses are doing better, and so they are paying more taxes. and the government uses that money not to grow government, it uses that money to pay down its debt and control itself. and how do you create more jobs and economic growth? you do it by encouraging people, not in this building but outside this building, encourang