The debt-ceiling debate continues to rage in Washington, with Montana’s two U. S. senators makings statements Thursday about an effective way to deal with the budget deficit and national debt, and about the impacts of not raising the debt ceiling.
The Senate voted down a House-approved bill known as Cut, Cap and Balance, which tied raising the debt ceiling to cutting and capping spending and requiring Congress to send a balanced budget amendment to the states for a vote.
Montana’s Rep. Denny Rehberg, a Republican who is facing Montana Democratic Sen. Jon Tester in the 2012 election‚ voted for and endorsed the bill in the House vote. Rehberg was a cosponsor of the bill.
Tester and Sen. Max Baucus, D-Mont., both voted against the bill.
Economists and officials of the administration of President Barack Obama have warned that if the debt ceiling is not increased, allowing the country to borrow more money, the United States soon may have to stop paying some of its bills.
Baucus said in a release Thursday that putting government services — such as Social Security, Medicare, veterans’ benefits, troop payments and more — at risk by not raising the debt ceiling would have an especially heavy impact on Montana.
That is for reasons which include Montana having the second-highest number of veterans per-capita in the United States; Montana ranking eighth in the nation in federal support per person for Social Security and federal retirement plans and fifth nationally in federal support including Medicare and agricultural payments; and ranking fourth in the nation for having the most federal funding as a percentage of its state budget, 43.5 percent, Baucus said in the release.
“There are real and painful consequences for Montana families, businesses, troops, seniors and veterans if we default — that can’t happen. This isn’t like canceling your credit card to save money, it’s like refusing to pay your credit card bill, defaulting on your mortgage, and not buying groceries to feed your family, ” Baucus said.
“There are good ideas out there, on both sides of the aisle, so there’s no reason we can’t reach an agreement. Let’s stop drawing lines in the sand and start reaching hands across the aisle to get this done. ”
He added that economists have said that failing to raise the debt ceiling could lead to a loss of the nation’s credit standing, causing interest rates to skyrocket. That could make it impossible for homeowners to get a mortgage or businesses to get the credit they need to pay their workers.
Tester Thursday endorsed a plan by a bipartisan group of senators known as “The Gang of Six” as the best way to deal with deficits and the debt.
Joining a bipartisan group of 33 other senators, Tester sent a letter to Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell, saying the “Gang of Six” plan can “Unite Republicans, Democrats and Independents, ” with its balanced mix of spending cuts, tax and entitlement reform, and limited future spending, based on the work of a bipartisan Debt Commission created by Obama.
“This plan from Democrats and Republicans strikes middle ground to keep Medicare and Social Security from going broke while making responsible spending cuts and reforming the tax code to close loopholes for millionaires and corporations that ship jobs overseas, ” Tester said. “Unlike the House’s unpopular, partisan plan to wipe out Medicare while protecting expensive tax loopholes for millionaires and Big Oil, our plan is designed by both parties to actually cut spending and eliminate waste, fraud and abuse. ” In his release, Tester said the “Gang of Six” plan would strengthen Social Security and Medicare, and also would cut the nation’s deficits by as much as $3.7 trillion over 10 years; stabilize publicly held debt by 2014; reduce publicly held debt to about 70 percent of the nation’s economy by 2021; and maintain investments that encourage economic growth.
Some Republicans in the House already have attacked the plan, saying its coupling spending cuts with tax increases is a problem — tax increases, which some say could be much higher than claimed by the “Gang of Six, ” should not happen when the country is struggling with an economic recession.