April 26, 2023

Chairman Aguilar: The extreme MAGA Republican circus is in town with Speaker McCarthy’s sideshow, the Default on America Act

WASHINGTON, D.C. – Today, House Democratic Caucus Chair Pete Aguilar and Vice Chair Ted Lieu held a leadership press conference with House Committee on Ways and Means Ranking Member Richard Neal, House Budget Committee Ranking Member Brendan Boyle, DPCC Chair Joe Neguse and DPCC Co-Chair Lauren Underwood on extreme MAGA Republicans’ Default on America Act (DOA). 

CHAIRMAN AGUILAR: Good morning, everyone. Pleasure to be joined by my colleagues today, and it is no secret that the circus is in town this week. Speaker McCarthy’s sideshow, the Default on America Act, is an extreme MAGA Republican wishlist that has zero chance of passing the Senate, and we'll see if it passes the House. Every minute wasted on Speaker McCarthy's empty gesture is a minute we get closer to default and a Republican-manufactured recession.

The markets are beginning to panic, and rating agencies have panned this plan that they say will significantly impact economic growth. This is what happens when you allow the most extreme members of that conference to write the budget and to dictate the priorities.

We’re joined by Ranking Members Neal and Boyle of the Ways & Means and Budget Committees to discuss the consequences of a Republican default. And DPCC Chair Joe Neguse and Co-Chair Lauren Underwood are here to lay out the stakes of this week’s vote.   

Make no mistake, House Democrats are ready to get to work, to put People Over Politics, and create better-paying jobs and lower costs for Americans. Now, I’d like to turn it over to Vice Chair Ted Lieu. 

VICE CHAIR LIEU: Thank you, Chairman Aguilar. Democrats put People Over Politics, and we passed a number of laws last term to move the American family forward, from the American Rescue Plan to a Bipartisan Infrastructure Law to laws that help veterans. But this Radical Republican Default on America bill is going to roll back a lot of that progress. We created over 10 million jobs in the first 15 months of the Biden presidency, the most in U.S. history. This radical MAGA bill will not only tank the stock market; it will result in higher unemployment and kick off 600,000 Americans off their health insurance, plus a 22 percent cut to veterans’ care. So Democrats are going to be unified in opposing this radical bill. And the outcome that we seek is to have America follow the Constitution and pay the debt that’s already been incurred. And then we're happy to talk with Republicans on what a future budget and spending and revenue package would look like. And with that, I'm going to invite up our amazing Ranking Member, Richard Neal, who's going to talk more about this Default on America Act.

RANKING MEMBER NEAL: Thanks, Ted. We need more of those introductions. So, thanks to you and to Pete, and thanks to the team here as we go forward. So the arithmetic here ought to be pretty clear to everybody. This represents a threat to the dollar as an international currency. But it's also a reminder of the recklessness of this policy. And it goes like this. So, George Bush cut taxes by $1.3 trillion in 2001, and came back with another trillion. There was a subsequent invasion of Iraq. A million and a half new veterans have been created because of these military incursions that we've had, and we're obligated for obviously good reason to pay those veterans benefits for those who have been wounded or harmed along the way. 

But back to arithmetic. So, they voted for the pandemic relief. They voted have consistently for more defense spending. Some of them voted for the CHIPS Act. Some of them voted for the Infrastructure Bill, and all of them in 2017, December, voted to borrow $2.3 trillion to provide tax cuts to the wealthiest amongst us. There has been $10 trillion worth of tax cuts over the last 25 years. And there has been no conversation from their side about putting the tax cuts on the table. So, Speaker McCarthy got himself into this. And I think reasonable people would come to the conclusion that we should have a clear and sustained vote on the debt ceiling, and then we should begin the process of discussion and or negotiation, as we're compelled. 

When I look at what this says to international markets, what I think it does in terms of the credibility of the United States and paying our bills. The full faith and credit of the United States becomes really important. 

So, if you look at this dollar, the one thing we know about this dollar is that in international markets, it's always redeemed. No matter where you travel the world, if you put the dollar on the table, if you're not in Euro or you're not in Sterling, that dollar will be redeemed. You can put out and they might say, ‘Well, we can't think right now, but we can give you change in that currency.’ But the point is that this is a threat to the full faith and credit of the United States. Why they would choose to use this mechanism of the debt ceiling to try and compel negotiations escapes me. They have voted for all the measures that I've just pointed out. And now they want us to have sort of amnesia and say that all of a sudden this was created because Joe Biden became president. This goes back to those tax cuts from Bush and tribal warfare to the Trump tax cuts, and it goes to the pandemic spending. That's the bill that's in front of us today and we should pay it. And by the way, this debt as proportion of Gross Domestic Product is manageable.

RANKING MEMBER BOYLE: Brendan Boyle, Ranking Member of the House Budget Committee, and as I've said before, you can always tell when there's a Democrat in the White House because Republicans suddenly start talking about deficit and debt. 

So, here we are again. The debt ceiling has been raised 103 times since 1940. However, it wasn't until 2010, after the so-called Tea Party Caucus won a majority in those elections, that for the first time in American history, we began to see the debt ceiling weaponized. Now, the other side wants to talk about being fiscally responsible. Let's be clear. There is absolutely nothing fiscally responsible about refusing to pay America's bills. As was just outlined before me, vote after vote after vote. We saw big bipartisan majorities vote for the spending that now the other side is refusing to pay that the bill has come due. I was here in the four years Donald Trump was president. Three times the debt ceiling was increased. Many of the folks on the other side who are now refusing to raise it and refusing to pay America's bills unless there are deep devastating cuts, they didn't say a peep about it those three times it was increased when Donald Trump was president. In fact, a number of those debt ceiling increases included spending increases, as well in defense. 

So, the hypocrisy here is staggering. But I also want to be clear that there are real-life consequences if this piece of legislation before us today were to somehow ever become law. It is the Default on America Act, D-O-A. Thank God it will be D-O-A in the Senate, even if it were to pass today. But that should not obscure what exactly it is that they've put on paper and that they're willing to vote for 22 percent cuts. Here's the effect that would have, not according to anyone on the Democratic side of the aisle, but according to Moody's Analytics, a nonpartisan well-respected firm. 800,000 job losses would be incurred if this piece of legislation became law. The odds of a recession would dramatically increase if this piece of legislation, the DOA Act, became law. So this is deeply irresponsible, as well as their entire brinksmanship on this issue. 

In 2011, it had real-life consequences. It led to the first-ever credit downgrade in American history, which increased our borrowing costs, according to GAO, by over $1.3 billion. We cannot go through that again. We must not. We must ensure that America pays its bills. Those of us standing here as well as all of our colleagues on our side of the aisle is willing to do that and to get the job done. We just need a partner on the other side of the aisle. And with that, I am happy to yield to Chair Joe Neguse.

DPCC Chair Neguse: Well, good morning. Thank you, Ranking Member Boyle, Ranking Member Neal. Good to know that the Ways and Means Ranking Member carries cash, something that you want for your Ranking Member from that Committee.  And, of course, gratitude to Chairman Aguilar and Vice Chair Lieu. 

I serve on the Rules Committee, and I participated last night in the markup that we had on the rule going into late into the morning, until about 2:30. I don't know that I participated in a hearing during my time in Congress, where hypocrisy and cognitive dissonance was on more full display than yesterday with extreme MAGA Republicans putting forward a bill, the Default on America Act, that would impose cruel, draconian cuts that would harm everyday Americans and then denying that those cuts would indeed happen. Just to give you a sense of the stakes and I think the choice, the unthinkable choice that Speaker McCarthy and House Republicans have put forward to the American people, on the one hand, they threatened a Republican debt default. You heard from Ranking Member Boyle, the consequences, catastrophic consequences were that to happen. Unemployment doubling, hundreds, millions of jobs across our country lost, stock market crashing, prices rising on everything and for everyone as seniors lose Social Security benefits to veterans lose benefits. And on the other hand, the other side of that coin, what do they offer us? A ransom note in the form of the Default on America Act, legislation that would kick millions of Americans out of their homes, cut food benefits for the most vulnerable among us, layoff hundreds of thousands of first responders, teachers across our country, and again, increase costs on working families. That is not a choice that the American people should be forced to make. And that's why this legislation, the Default on America legislation, as Ranking Member Boyle articulated, is dead on arrival, dead on arrival in the Senate. And at the end of the day, what we expect from our colleagues on the other side is to get serious and not hold our economy hostage. So, with us today, we have one of our DPCC Co-Chairs, Co-Chair Underwood who will help articulate the work we have been doing putting People Over Politics while Republicans threaten the American economy. With that, I’ll yield to my colleague. 

DPCC CO-CHAIR UNDERWOOD:  Well, good morning, everyone. We are here today because House Republicans are threatening to push the global economy off a cliff by refusing to pay our bills. Their Default on America Act is an unserious proposal and a terrible deal for the American people. Paying our bills should not be up for debate. 

Now, the suffering that a default would inflict should provide enough motivation for Republicans to get serious, that this proposal tells us that they aren't. So let me spell out what a default would look like. Millions of people will lose their jobs and the stock market will crash. Seniors will lose their savings and Social Security recipients and our veterans will stop getting the benefits that they've earned. Car payments, student loans, credit card bills and mortgages will skyrocket. Democrats are here to prevent this disaster and pay our bills just like we did three times under President Trump. But now, extreme MAGA Republicans are refusing to do so and holding our communities hostage for political gains. The cuts in their Default on America Act are devastating for the people that we serve. They want to gut funding to our schools and take away child care. They want to force towns across America to lay off first responders and tear food assistance away from families. We cannot allow that.

Democrats have cut our deficit by $1.5 trillion already. And President Biden's budget will bring it down by another $3 trillion. The President's budget proves that we can cut our deficit and make investments in our communities. The United States of America has never defaulted on our debt. And Democrats are here putting People Over Politics. We pay our bills. We have a plan, and President Biden has outlined it. Now, Republicans need to get serious because defaulting on our debt is non-negotiable. And so is the devastation that their plan will inflict. Thank you. Now, turn it back to our Chairman Pete Aguilar. 

Video of the full press conference and Q&A can be viewed here.