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Senate Proceeding 06-16-09 on Jun 16th, 2009 :: 1:43:05 to 2:13:45
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Jeff Sessions

1:43:01 to 1:43:23( Edit History Discussion )

Jeff Sessions: we, in fact, can do that. thank you, mr. president, and i would yield the floor. a senator: mr. president? the presiding officer: the senator from alabama. mr. sessions: mr. president, about two weeks the floor about the unprecedented budget deficits

Jeff Sessions

1:43:05 to 2:13:45( Edit History Discussion )
Speech By: Jeff Sessions

Jeff Sessions

1:43:24 to 1:43:47( Edit History Discussion )

Jeff Sessions: that this country is now facing. the fact that we're spending money we do not have, and i specifically discu pact thas having on treasury yields. what we know is that president obama's budget has been scored by the congressional budget office, which is our group -- and i think they do a pretty good job. they take pride in being

Jeff Sessions

1:43:48 to 1:44:09( Edit History Discussion )

Jeff Sessions: independent and the head of it was selected by the democratic majority senate. they're certainly not a republican organization, they're just a best they can to calculate the numbers. what they calculated was, that the rate of deficit spending that we're now undertaking, the total american debt will dmowbl

Jeff Sessions

1:44:10 to 1:44:31( Edit History Discussion )

Jeff Sessions: ten years from 5.-- tenears from $5.7 trillion to over $11 trillion. and in ten years, it will trip now, that's a lot of debt. so you might ask: what happens, how do you do that? how do you spend more money than you take in? the way you do it is we borrow

Jeff Sessions

1:44:32 to 1:44:54( Edit History Discussion )

Jeff Sessions: it, just like other people do. the vernment borrows it and the way it does, it puts out an auction or sale of treasury bonds or bills -- t-bills call them addition and people buy those things to do so and government pays them certain intt rate, whatever the interest rate is at

Jeff Sessions

1:44:55 to 1:45:16( Edit History Discussion )

Jeff Sessions: the time. on short-term debt instruments -- of a more or whatever -- those interest rates are still rather low because people are panicked over the economic situation. they were afraid to put their money in the stock market so they but the treasury bills and

Jeff Sessions

1:45:17 to 1:45:39( Edit History Discussion )

Jeff Sessions: other people around the world did, too. they're not getting much interest but they feel like the government will pay them back in dollars eventually. but what has been the t-year treasury bill, one of the foundations of our borrowing. that rate has continued to go up.

Jeff Sessions

1:45:40 to 1:46:03( Edit History Discussion )

Jeff Sessions: so two weeks ago i pointed out that the ten-year treasury yields had increased 54% this year at that time from 2.4% in january to 3.7%. a financial publications predict add few weeks ago that treasury

Jeff Sessions

1:46:04 to 1:46:24( Edit History Discussion )

Jeff Sessions: yields -- quote -- well, guess what? treasury yields topped 4% this week! well, last week it was. "the wall street journal," in a front page article on june 11 said that the ten-year treasury yield briefly hit 4% yesterday

Jeff Sessions

1:46:25 to 1:46:45( Edit History Discussion )

Jeff Sessions: afternoon before closing 3.94%. that would the treasury bill interest just this year. so while -- so, why are rates going up? there are some bad things about it and i will talk about that in a minute. why

Jeff Sessions

1:46:46 to 1:47:06( Edit History Discussion )

Jeff Sessions: it seems there is disagreement between washington and wall street. "the wall street journal" article says this: " policy-makers see the rise in treasury yields as a sign that investors are optimistic the economy is on the mend but many market participants say higher

Jeff Sessions

1:47:07 to 1:47:27( Edit History Discussion )

Jeff Sessions: long-term bond yields indicate investors are increasingly worried about inflation." so i interpret that to mean the washington political crowd looking to see a positive vision here and to see something good,

Jeff Sessions

1:47:28 to 1:47:48( Edit History Discussion )

Jeff Sessions: say it's because the economy is ding better and that could be a factor but the folks on wall street who are buying the t-bills say different. well, is the government responsible for this increase in interest rates and what does it mean? it seems that is a real

Jeff Sessions

1:47:49 to 1:48:09( Edit History Discussion )

Jeff Sessions: possibility. the federal reserve is creating inflation concerns through its massive asset purchase program. the fed plans t trillion in mortgage-backed securities, $200 billion in freddie mac and fannie mae debt,

Jeff Sessions

1:48:10 to 1:48:30( Edit History Discussion )

Jeff Sessions: and $300 billion in treasury bills this year. since not enough people apparently want to buy the treasury bills at lower interest rates the federal reserve is stepping in and buying them in an attempt to keep the rate done. so far, the fed has purchased $481 billion in mortgage-backed securities, $130 billion in

Jeff Sessions

1:48:31 to 1:48:51( Edit History Discussion )

Jeff Sessions: treasuries. the intense of the program is to reduce the treasury yields and interest rates but some say it may be backfire. a "forbes".c forbes.com article says this

Jeff Sessions

1:48:52 to 1:49:12( Edit History Discussion )

Jeff Sessions: could have a different impact, could actually cause inflation rather than -- and even cause a rise in treasury bond yields. this is what he said: -- quote -- "this can become counterproductive to the extent that you stoke inflation fears and you get

Jeff Sessions

1:49:13 to 1:49:34( Edit History Discussion )

Jeff Sessions: premium built in to the bond yiel away. you do have to be careful and more measured than that." in other perception which that not enough people are willing to buy these treasury

Jeff Sessions

1:49:35 to 1:49:57( Edit History Discussion )

Jeff Sessions: bonds at lower rates because they think even 4% may not be enough because they or 7% just down the road and they don't want to lock themselves in for 10 years at 4% interest rate and that's below the inflation rate. so the fed steps in and buys some of this to keep it low and

Jeff Sessions

1:49:58 to 1:50:18( Edit History Discussion )

Jeff Sessions: that may be having the perverse incentive of causing a belief to occur in t inflation is on the way and scares people even more. also, let me ask this about the voluntary purchase of treasury bills by citizens of the united

Jeff Sessions

1:50:19 to 1:50:39( Edit History Discussion )

Jeff Sessions: states, people in china, middle east, and around the world. they don't have to boy treasury buy treasury bills. and we're going to be offering amounts -- these kind of bills in volume we have never offered before in the history of the public.

Jeff Sessions

1:50:40 to 1:51:00( Edit History Discussion )

Jeff Sessions: the question is, who wants to buy them? who wants to hold a mortgage on the united states? wha deflight our currency. maybe they want more. maybe china which had the huge trade surplus a few years ago, maybe they don't have it anymore. they don't. and maybe they're deciding

Jeff Sessions

1:51:01 to 1:51:23( Edit History Discussion )

Jeff Sessions: they're not going to buy so much treasury bills in the united states. maybe they decide to invest in their own economy which has not done as well as it has the past. same with the middle east. they used to have huge reserves of american money as a result of the high price of gasoline and

Jeff Sessions

1:51:24 to 1:51:45( Edit History Discussion )

Jeff Sessions: the oil on the world mark but that has dropped and perhaps they don't have the money on the treasury bills either. so who will buy them? we're but about going from $5 trillion in total debt today to $10 trillion, really, $11 trillion in just five years.

Jeff Sessions

1:51:46 to 1:52:11( Edit History Discussion )

Jeff Sessions: and $17 trillion in 10 years so we're talking about over -- over $10 trillion in new debt to sell somebody in the world market. also, what is the impact of the federal reserve, that entity

Jeff Sessions

1:52:12 to 1:52:33( Edit History Discussion )

Jeff Sessions: we've created by law, when they buy treasury bills? what occurs there? i rember hearing mr. bernanke, the federal reserve chairman, talk about this on "60 minutes," and i went back and had the

Jeff Sessions

1:52:34 to 1:52:58( Edit History Discussion )

Jeff Sessions: transcript of this program called up and we reviewed it and it is what i thought he said. in response to reporter school pelly's question the chairman bernanke said, about the fed buying akin to printing money than it

Jeff Sessions

1:53:01 to 1:53:23( Edit History Discussion )

Jeff Sessions: is to borrowing." mr. pelly replies, "you've been "well effectively and we need to do that because our economy is very weak and inflation is very low." so if you want to know the

Jeff Sessions

1:53:24 to 1:53:44( Edit History Discussion )

Jeff Sessions: definition of "prng as some ople say that is not a printing money but mr. bernanke, the chief of the fed, the guy that does it, says were printing money. why does this average american, even those not planning to buy a treasury bill

Jeff Sessions

1:53:45 to 1:54:06( Edit History Discussion )

Jeff Sessions: any time soon, will be affected. that is because mortgage borrow money to buy a house with, track the ten-year treasury yield so as treasury goes up, mortgage rates go up, too. and it's much harder for people to buy a home or to refinance or

Jeff Sessions

1:54:07 to 1:54:28( Edit History Discussion )

Jeff Sessions: if you want to sell a 40e78 it's harder -- sell a home it's harder for the person who to buy because they have to pay considerably more in interest rate. according to the journal." 30 year mortgage rate has gone up 16% in two weeks from 5% to 5.79%

Jeff Sessions

1:54:29 to 1:54:53( Edit History Discussion )

Jeff Sessions: this is the money when you go out to borrow money to by a hous with. what we need to happen in america is for people to decide to buy a home and take these vacant homes off the market and get somebody in them so they difference between 5% and 6%.

Jeff Sessions

1:54:54 to 1:55:18( Edit History Discussion )

Jeff Sessions: on $100,000, a 5% interest it would be $5,000 a year you pay just in $6,000 a year. over $100 more a month on

Jeff Sessions

1:55:19 to 1:55:39( Edit History Discussion )

Jeff Sessions: $100,000 would be twice that a year that yo pay in interest alone. we hoped the interest rates would people to by homes, to encourage people to refinance, and to be able to live a better life.

Jeff Sessions

1:55:40 to 1:56:00( Edit History Discussion )

Jeff Sessions: "the wall street journal" article said that this increase from 5% to almost 6%, will cut the number incentive to recontinue their to -- to refinance

Jeff Sessions

1:56:01 to 1:56:23( Edit History Discussion )

Jeff Sessions: their home by half. and let me just mention one more thing. one of the things that is interesting in all of this is the impact our spending has had on the economy. we all hoped it would have a pretty dramatic impact but it is

Jeff Sessions

1:56:24 to 1:56:45( Edit History Discussion )

Jeff Sessions: not as effective as people thought. even i thought we would have some impact in the short-term but i believe that c.b.o. is correct $800 billion stimulus package that was to put money into the economy and build roads and bridges and we found out only 4%

Jeff Sessions

1:56:46 to 1:57:06( Edit History Discussion )

Jeff Sessions: of the money went to roads and bridges and 96 went to other government spending. but the $800 billion was supposed to cree a good bit of jobs and get thi moving. i just want to say,hings are going as i remain optimistic. the fed doing all these things,

Jeff Sessions

1:57:07 to 1:57:30( Edit History Discussion )

Jeff Sessions: the spending is coming along. surely we will have a benefit from that in the n but this just shows the deficit surge. the deficit, by which i mean, which is how much more money we are spending than betake in. this goes through march of this year.

Jeff Sessions

1:57:31 to 1:57:53( Edit History Discussion )

Jeff Sessions: you can see how the deficit is increasing, how much our shortfall is, and by march it's already tied -- atop $953 billion. that's twice the -- more than twice, the biggest deficit president bush ever had and he

Jeff Sessions

1:57:54 to 1:58:16( Edit History Discussion )

Jeff Sessions: was criticized for his deficits. that's twice, and we haven't gotten to the end of the fiscal year yet. what the c.b.o. projects and this is our own congressional budget office numbers and they're running the tale of how much w we are -- the tally of how much we are spending and they

Jeff Sessions

1:58:17 to 1:58:37( Edit History Discussion )

Jeff Sessions: estimate $1. deficit by the end of the year. that is about four times the highest deficit president bush ever had. i just say that because people say, well, president bush had deficits too. yes, he did. a lot of that was not justified in my opinion but we never had

Jeff Sessions

1:58:38 to 1:59:01( Edit History Discussion )

Jeff Sessions: deficits like this in the history of the american republic. and you have to borrow this money. so this is in march. by sent 30th, we're looking at a deficit of $1.8 trillion this year alone and the whole debt of themerican republic since the

Jeff Sessions

1:59:02 to 1:59:24( Edit History Discussion )

Jeff Sessions: this year's now, what is one year? and i would say we had hoped the spending and this activity would help improve the unemployment rate but as you can see it was 6.6% and it has again up to 8.5%.

Jeff Sessions

1:59:25 to 1:59:46( Edit History Discussion )

Jeff Sessions: well, really it's not 8.5%. that was in the latest nones are 9.4 -- the latest numbers are 9.4 jievment. i don't know how much real boston we have gotten from the reckless spending. so much of it we knew was not job-creative. and we

Jeff Sessions

1:59:47 to 2:00:08( Edit History Discussion )

Jeff Sessions: it was clear that a lot of this was the kind of spending that would not create like i said, you heard about roads and bridges. well only 4% of the money went to roads and bridges. programs that are not really job-creating programs.

Jeff Sessions

2:00:09 to 2:00:30( Edit History Discussion )

Jeff Sessions: so i'm concerned about that. now, this is a vibrant country, but what people -- and i think we have the capability of bouncing back fm hard i'll just say, unemployment. unemployment in the early 1980's under president reagan when they had to break the back of surge

Jeff Sessions

2:00:31 to 2:00:53( Edit History Discussion )

Jeff Sessions: inflation and mr. volcker at the federal rerks they got together and they did some tough things and they broke the back of 15%, 13% inflation, unemployment hit 10.8%, so it's not as high it was in the bounced tbrak that. and we can bou this.

Jeff Sessions

2:00:54 to 2:01:14( Edit History Discussion )

Jeff Sessions: so i've got to say to my colleagues, if we don't have fiscal sanity in how we do our business, if we don't he a possibility of revenues from economic growth and a containment of spending and our deficits are surging for as far as the eye can

Jeff Sessions

2:01:15 to 2:01:35( Edit History Discussion )

Jeff Sessions: i'm not sure we will have the kind of healthy, robust resurgence that we would normally expect to occur after a recession. look at these numbers just very, very, very disturbing. so

Jeff Sessions

2:01:36 to 2:01:57( Edit History Discussion )

Jeff Sessions: we spend it today. i know a great lawyer who's written a book request, "the case of character." this is a case for here. it is the moral character of the united states congress and the president of the united states and how we approach our duties

Jeff Sessions

2:01:58 to 2:02:18( Edit History Discussion )

Jeff Sessions: in a 2009, this year, we expect that this -- the taxpayers of the united states parliamentary inquiry that we borrowed will pay $170 tbhl trvment that's a total loss. that's money that goes out people who have loaned us money it's interest, just like on your

Jeff Sessions

2:02:19 to 2:02:39( Edit History Discussion )

Jeff Sessions: credit card or on your mortgage. $170 billion. and look how it goes up. this is a chart of the interest each year. and this is te under the 10-year budget that we're supposed to be operating under, that was passed according to the congressional

Jeff Sessions

2:02:40 to 2:03:01( Edit History Discussion )

Jeff Sessions: budget office, they sco the interest we will pay debt in just 10 years will be $806 billion. all how much is i that? how much is $806 billion? let me tell you what quey do today.

Jeff Sessions

2:03:02 to 2:03:23( Edit History Discussion )

Jeff Sessions: federal highway bill is about $40 billion. the federal aid to education in all its forms is billion. so now since we take money from the future and we spend it today to get some sort of hope

Jeff Sessions

2:03:24 to 2:03:44( Edit History Discussion )

Jeff Sessions: stimulus that we haven't seen much of, in people in 2019 with $806 billion, ten times the federal agency budget, 20-plus times the

Jeff Sessions

2:03:45 to 2:04:05( Edit History Discussion )

Jeff Sessions: highway budget. we don't need to be focused on this and let me say one more thing: there is no projectio debt and years by the budget office. we drop down, i think, in two or three years under their

Jeff Sessions

2:04:06 to 2:04:27( Edit History Discussion )

Jeff Sessions: projections and we're already hitting numbers that don't look li the economy is not a.g. as strength as they were projecting. it was a rosy scenario, but they project about what the deficit will be two or three years from now. 30%, 40% higher than anything

Jeff Sessions

2:04:28 to 2:04:49( Edit History Discussion )

Jeff Sessions: president bush ever had. then it starts up again. and it goes up to the tenth year, and in the tenth year under the scoring of the president's budget by the congressional budget office, the deficit will be over $1 trillion in that year, $1.1

Jeff Sessions

2:04:50 to 2:05:10( Edit History Discussion )

Jeff Sessions: i recall. so that's nonsustainable. and they're not project economic slowdown. they've projecting solid growth period. so i guess i would said to my

Jeff Sessions

2:05:11 to 2:05:35( Edit History Discussion )

Jeff Sessions: colleagues, this is a matter that we need to start thinking about. it cannot be ignored. there's -- nothing comes from nothing. if you get money to spend today, you must spend every dollar of it borrowed it from the future. and somebody has to pay it back.

Jeff Sessions

2:05:36 to 2:05:58( Edit History Discussion )

Jeff Sessions: it's not free money. it may feel like free today because we didn't have to pay higher taxes or we didn't cut some other spending programs to get the money to do what we'd like to do with it. we just borrowed t but borrowing has consequences. so every year from here that $806 billion will go up

Jeff Sessions

2:05:59 to 2:06:19( Edit History Discussion )

Jeff Sessions: probably, because in 2019 they expect not an annual deficit of that year to be over $1 trillion. society thing is going to continue to work if we d make some this will continue. by the way, it does not

Jeff Sessions

2:06:20 to 2:06:40( Edit History Discussion )

Jeff Sessions: the spending that we're talking about on health care, which you heard a speech about and i would just say this about it: the reported out a bill -- the health, education, labor, and pensions committee -- they reported out a bill which scores at $1 trillion.

Jeff Sessions

2:06:41 to 2:07:03( Edit History Discussion )

Jeff Sessions: oh, we just got trillion not numbers. well, everybody just needs to have health insurance. so who's going to pay pour it? we have to be smart. we have to see how we can improve health care, get more people insured, create

Jeff Sessions

2:07:04 to 2:07:24( Edit History Discussion )

Jeff Sessions: system with the absolute lowest possib cost, both because we cannot continue this kind of reckless spending. and instead from the already-surging deficits, we seem to blithely going on with a huge new spending program on top of that. the american people are -- i

Jeff Sessions

2:07:25 to 2:07:47( Edit History Discussion )

Jeff Sessions: think are uneasy. they think that we are out of control up here. they don't think that they've ever seen anything like this. deficits the likes of we've never seen and we've got the united states

Jeff Sessions

2:07:48 to 2:08:12( Edit History Discussion )

Jeff Sessions: government passed a bill last fall that was supposed to buy toxic mortgages from banks and now they controlling share in general motors. how did this happen? no, we they took the language in that bill that i opposed and voted against because one of the

Jeff Sessions

2:08:13 to 2:08:34( Edit History Discussion )

Jeff Sessions: reasons was was to broad and an unbelievable abrogation of congressional power to the secretary of treasury who'd already helped lead u into financial catastrophe. but people didn't panic. they all voted and gave him this power. well, did anybody know that we were going to use that money to buy an automobile company with? no.

Jeff Sessions

2:08:35 to 2:08:55( Edit History Discussion )

Jeff Sessions: that was -- in fact, paulson at one in a hearing did he -- what about buying stock in banks? that was supposed to be helping the banks. in the house committ no, he didn't want to buy stock in banks. but a week after that bill passed, he was buying stock in

Jeff Sessions

2:08:56 to 2:09:17( Edit History Discussion )

Jeff Sessions: to buy mortgage -- toxic mortgages. maybe they'll begin soon. they say they've got a plan now. but i'm just sark the american people saying, the american people are right to be concerned about the reckless, irresponsible behavior of this government in washington. i hope they will continue to watch what is going on. i hope the american people will

Jeff Sessions

2:09:18 to 2:09:38( Edit History Discussion )

Jeff Sessions: speak out and let the folks up here know that they expect us to do something more than deal with the they expect us to be thinking about the long-term health of the american economy. i just heard a well-known

Jeff Sessions

2:09:39 to 2:10:01( Edit History Discussion )

Jeff Sessions: financial expert say, well, you know what? he said, i'm not saying that there will be occur, although vom predicting that. this is what he said. he said after president reagan broke inflation and we got the economy on a soundtrack, the

Jeff Sessions

2:10:02 to 2:10:23( Edit History Discussion )

Jeff Sessions: economy grew, mr. president, about 3% a year. and inflation was about 2%. he said, what i'm worried about is, what we're going to see in theext ten years is inflation about 3% and growth about that's not good. you want your growth to exceed the inflation rate, and so i

Jeff Sessions

2:10:24 to 2:10:45( Edit History Discussion )

Jeff Sessions: don't know what'll happen. i can't predict it. we're going to have less money to spend on the things we need because we're going to have to be paying out a huge amount of known interest. those are real concerns. this matter is not going away. are becoming more and more attuned to these matters. that's what the tea parties were

Jeff Sessions

2:10:46 to 2:11:06( Edit History Discussion )

Jeff Sessions: about and other things, a sort of spontaneous reaction by the american people saying, what are you guys doing up there? surely you know this isn't the way to handle america's so i would just say, i'm going to continue to report on things that are developing.

Jeff Sessions

2:11:07 to 2:11:28( Edit History Discussion )

Jeff Sessions: surely we'll begin improvement in unemployment rate and maybe some economic growth in the weeks to come. you would normally expect that when you pump the kind of money that we pumped into this economy. and -- but in the long run, this beginnings to drag down the gains you make in the short run

Jeff Sessions

2:11:29 to 2:11:49( Edit History Discussion )

Jeff Sessions: is what i'm saismght and in fact the congressional budget office said that if analyzing just simple stimulus package alone that it would increase g.d.p. for two to three years, but if you took that for over ten years, the

Jeff Sessions

2:11:50 to 2:12:11( Edit History Discussion )

Jeff Sessions: economy would be -- would grow less over the ten years than if we had no stimulus all. and that's because when you borrow money, not only do you have to pay interest on it, but it crowds private sector.

Jeff Sessions

2:12:12 to 2:12:32( Edit History Discussion )

Jeff Sessions: so if a corporation wants to borrow money through the issuance o bonds, they're treasury bills, who are now paying they'll have to start paying more because people think it is

Jeff Sessions

2:12:33 to 2:12:54( Edit History Discussion )

Jeff Sessions: safer so it hurts the private sector because they're paying considerably higher interest rates to get people to loan money to them instead of loaning government. i hope and pray that we can figure out a way to wk together to do a better job of

Jeff Sessions

2:12:55 to 2:13:17( Edit History Discussion )

Jeff Sessions: being stewards of this economy. it's a high responsibility that we have. no one knows everything. no one has got a perfect answer to it. we're going to have to go through some to think that's clear. no need to sugar-coat that. i'm not blaming president obama for everything that's gone wrong, and he inherited so much of this.

Jeff Sessions

2:13:18 to 2:13:38( Edit History Discussion )

Jeff Sessions: paulson. i don't think secretary geithner is any better. he was secretary paul sonses top advisor -- he was secretary paulson's top advisor when they came up with this plan last fall. but at any rate, we need to get our heads together and know one thing: nothing comes from nothing. there's

Jeff Sessions

2:13:39 to 2:13:51( Edit History Discussion )

Jeff Sessions: if you borrow money to spend today, there will -- today, there will be a cost in the future, and those costs can outweighhe benefits that are occurring today.

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