Sen. Bob Corker called Thursday for a short-term extension of the U.S. debt limit to prevent a downgrading of the country’s credit rating.
In a speech on the Senate floor, Corker, R-Tenn., said the proposals offered by House Speaker John Boehner and Senate Democratic Leader Harry Reid both are probably too weak to avert a downgrade.
Corker said Congress should pass a short-term extension and “at least take a week” to try to agree on a plan that would produce enough savings to satisfy the credit ratings agencies. He called on Republicans and Democrats to work together to “send a signal to the world that our future is not the future that Greece is seeing today.”
Relatedly, Congressman Jim Cooper, D-Tenn., issued a statement Thursday regarding his decision to vote ‘no’ on Boehner’s Budget Control Act of 2011.
“We need a comprehensive, bipartisan proposal that raises our debt ceiling and lowers the debt in the long-term, and we need one in the next 5 days,” Cooper said in the statement. “The Boehner bill doesn’t meet any of these criteria and it won’t have my support.”
Cooper has introduced legislation (H.R. 2653) that would stop congressional pay if the United States defaults on the national debt. The bill would prohibit members from receiving pay during a default, and would not allow for that pay to be recouped retroactively. Cooper is also the only member of Congress to vote for every proposal available to raise the debt ceiling before Aug. 2.
Cooper is a long time advocate of a bipartisan debt plan that reduces spending and reforms the tax code. Last week, he sent a letter to Boehner and Democratic House Minority Leader Nancy Pelosi urging them to allow a vote on the “Gang of Six” bipartisan proposal that would have reduced the debt by almost $4 trillion over the next 10 years. House leadership has not initiated a vote on the proposal.
Standard & Poor’s has said a deficit reduction package of about $4 trillion over 10 years would be necessary to protect the country’s AAA credit rating. Neither Boehner’s nor Reid’s proposal would cut that much.
According to analysts, a credit rating downgrade could result in a $100 billion increase in annual borrowing costs for the government, which would in turn increase interest rates for consumers.
“After town hall meetings all across our state, in every form you can imagine, people are very aware in my state, as they are across the country, with the fact that we are on an unsustainable course,” Corker said. “We have two bills that don’t go far enough, and again I applaud both the Democratic leader and the Republican leader for putting forth proposals. We all know it doesn’t do what it needs to do, either proposal.
“We know the aspirational goals of each proposal don’t take us far enough. So what I would say to all, let’s don’t default. Let’s don’t bump up against August the 3rd. Let’s pass a short-term time extension. Let’s take us through the end of August or the first two weeks in September, or at least take a week. But let’s finish our work in this body.
“Let’s don’t miss this seminal opportunity where everybody in this country and everybody in this world is looking at how undisciplined we’ve been and the opportunity that we have before us to actually be disciplined and send a signal to the world that our future is not the future that Greece is seeing today. Our future is the continuation of American exceptionalism, all around this world, and we are squandering that opportunity right now in this body at a time when we’re finally focused on the right topic.”