House Budget Committee Mark-Up: Reconciliation and Replacing the Sequester

Chairman Paul Ryan – Opening Remarks, As Prepared for Delivery

Welcome to today’s mark-up. Today, this Committee meets to advance sensible spending restraints and to reprioritize savings called for under the Budget Control Act.

Last year, as we were coming up on the debt ceiling, the Obama administration asked Congress to rubber-stamp a blank-check increase in the federal government’s borrowing authority. Then the President insisted that he would not accept a debt-ceiling deal that did not include large tax increases on American families and businesses. All of this work was made more difficult by the Senate’s failure to pass any budgets at all.

Nevertheless, both parties came together to avoid defaulting on the government’s obligations. We succeeded in protecting hardworking taxpayers by securing a debt-limit increase that contained zero tax hikes. Instead, we established caps on discretionary spending, achieving a minimum of approximately $917 billion in savings over ten years.

And we established a Joint Select Committee to produce at least $1.2 trillion in additional deficit reduction, backstopped by an automatic sequester. Despite a good-faith effort to avoid the sequester, the Committee’s negotiations broke down over some very fundamental differences in visions for our nation’s future.

In our view, we shouldn’t be taking more from hardworking Americans to fix Washington’s mistakes. Instead, we should be solving the problem with structural reforms to our entitlement programs to make them strong and sustainable.

We couldn’t get agreement on those core principles, so the 2013 sequester is scheduled to impose a $109 billion across-the-board, inflexible, and arbitrary cut in spending on January 2, 2013.

Despite our differences, we again find ourselves in strong bipartisan agreement that the sequester is bad policy and should be replaced. The 10 percent across-the-board cut in defense spending from the sequester would quote, “hollow out” our national defense. Those aren’t my words. That is how the Secretary of Defense describes it.

The 8 percent across-the-board cut in non-defense discretionary spending from the sequester would “inflict great damage on critical domestic priorities.” Those aren’t my words. Those words come from the President’s budget.

That’s why this committee and this House passed a responsible budget and why we’re here today to meet our legal and our moral obligations to lead. Six House committees have reported legislation that would replace the sequester with common-sense spending reductions that members of both parties should be able to support.

The legislation before the committee today does five key things:

  • First, it stops fraud by ensuring individuals are actually eligible for the taxpayer benefits they receive. For instance, we propose to stop fraud in the food-stamp program by ensuring that individuals are actually eligible for the taxpayer benefits they receive. That shouldn’t be a partisan issue. That’s common sense.

  • Second, we eliminate government slush funds and stop bailouts. This reconciliation bill saves billions of taxpayer dollars by eliminating the Dodd-Frank-created “too-big-to-fail” bailout fund. We need to be ending the concept of “too big to fail,” not enshrining it with this explicit guarantee.

  • Third, it controls runaway, unchecked spending. It does this mainly by re-examining some very unwise spending choices that were made by the White House and the last Congress in passing the stimulus and health care laws. For example, take the health law’s “CO-OP” program, which disburses government subsidized loans. According to the Office of Management and Budget – not us, but OMB – 50 percent of these loans will never be repaid.

  • Fourth, it restrains spending on government bureaucracies. Look, we all believe in a strong federal workforce. But workers in the private sector are being asked to share more equitably in the cost of their retirement benefits, and federal workers need to do the same. 

  • Finally, it gets rid of wasteful and duplicative spending. I’m sure our friends on the other side will talk a lot today about the Social Services Block Grant, but what they won’t tell you is that the missions of this outdated block grant – which was created in 1956 – are currently being duplicated by dozens of newer federal programs. Taxpayers deserve better than to see their money wasted on duplicative federal programs that never end simply because ending them would take turf away from some bureaucracy.  

These savings will replace the arbitrary sequester cuts and lay the groundwork for further efforts to avert the spending-driven economic crisis before us. Unless we act, the sequester will take effect. I do not believe this is in the national interest, and the President claims that he agrees. There is no reason why we cannot work together to replace the sequester.  House Republicans are bringing specific proposals to the table, and we invite the administration to do the same.

To learn more about the House Republicans’ common-sense efforts to reprioritize sequester savings: /Reconciliation/