At the end of April, the Treasury Department announced that it would pay down $35 billion of the nation’s debt for the first time since 2007.  In February, the Congressional Budget Office estimated that the federal government would run a deficit of $845 billion this year, 24 times the amount the Treasury is paying down. 

Earlier this year, Congress passed the No Budget, No Pay Act, which required the House and Senate to pass a budget, but also suspended the debt limit until May 18th.  Last week, the Treasury Department said, “If Congress fails to increase the debt limit by May 19, Treasury can use extraordinary measures to create additional borrowing room."

Today, the House will consider the Full Faith and Credit Act, H.R.807, to direct the United States Treasury, in the event the debt ceiling is reached, to pay the principal and interest due on debt held by the public before making any other payments. 

As the Heritage Foundation said, “to see significant reductions in the national debt, lawmakers need to show greater fiscal discipline…” 

Paying off some of the debt is a good first step, but we cannot continue on the same path of reckless spending and repeated debates over further increasing the debt ceiling. I introduced the Congressional Accountability Pay (CAP) Act, H.R.284, to address situations like this.  The more Washington spends, the less Members of Congress should receive in their paychecks.  Read more here.

I want to share with you a recent CNBC article  showing that GDP in the United States fell for the first time since 2009.  Both the article and the chart below, indicate that the 0.1 percent decline is due in large part to the largest cuts to defense spending our nation has seen in 40 years. 

Since 2011, when sequestration was introduced as a means to reduce spending, I have been warming against drastic and dangerous cuts to our military.  I opposed the Budget Control Act, which will implement sequestration and slash defense spending on March 1, 2013, and have consistently supported alternative plans to address the debt and reign in spending in Washington.  Given this latest economic report, do you agree that a strong defense is necessary to maintain a strong America?

 
GDP Shows Surprise Drop for US in Fourth Quarter
Published: Wednesday, 30 Jan 2013 | 8:11 AM ET

The U.S. economy posted a stunning drop of 0.1 percent in the fourth quarter, defying expectations for slow growth and possibly providing incentive for more Federal Reserve stimulus.

The economy shrank from October through December for the first time since the recession ended, hurt by the biggest cut in defense spending in 40 years, fewer exports and sluggish growth in company stockpiles.

The Commerce Department said Wednesday that the economy contracted at an annual rate of 0.1 percent in the fourth quarter. That's a sharp slowdown from the 3.1 percent growth rate in the July-September quarter.

The surprise contraction could raise fears about the economy's ability to handle tax increases that took effect in January and looming spending cuts.

Still, the weakness may be because of one-time factors. Government spending cuts and slower inventory growth subtracted a total of 2.6 percentage points from growth.

And those volatile categories offset faster growth in consumer spending, business investment and housing -- the economy's core drivers of growth.

Another positive aspect of the report: For all of 2012, the economy expanded 2.2 percent, better than 2011's growth of 1.8 percent.

The economy may stay weak at the start of the year because Americans are coming to grips with an increase in Social Security taxes that has left them with less take-home pay.

Subpar growth has held back hiring. The economy has created about 150,000 jobs a month, on average, for the past two years. That's barely enough to reduce the unemployment rate, which has been 7.8 percent for the past two months.

Economists forecast that unemployment stayed at the still-high rate again this month. The government releases the January jobs report Friday.

The slower growth in stockpiles comes after a big jump in the third quarter. Companies frequently cut back on inventories if they anticipate a slowdown in sales. Slower inventory growth means factories likely produced less.

Heavy equipment maker Caterpillar, Inc. said this week that it reduced its inventories by $2 billion in the fourth quarter as global sales declined from a year earlier.

The biggest question going forward is how consumers react to the expiration of a Social Security tax cut. Congress and the White House allowed the temporary tax cut to expire in January, but reached a deal to keep income taxes from rising on most Americans.

The tax increase will lower take home pay this year by about 2 percent. That means a household earning $50,000 a year will have about $1,000 less to spend. A household with two high-paid workers will have up to $4,500 less.

Already, a key measure of consumer confidence plummeted this month after Americans noticed the reduction in their paychecks, the Conference Board reported Tuesday.

Economists expected the first reading on gross domestic product to show growth of 1 percent, down from the third quarter's reading of 3.1 percent.

In my recent online survey, I asked people which issues they believe are most critical for Congress to address.  Most (2660 out of 5174) said “taking serious action to reduce government spending.” I agree.

Today, the national debt is over $16.4 trillion.  That is more than $52,000 for every American, more than $135,000 for every U.S. household, and is greater than the size of our economy. We need to address the deficit and federal spending, but we also need to reform the way in which Congress acts in addressing the fiscal state of our nation. One way to do this is by introducing accountability of Members of Congress into the budget and spending process. Consistent with these goals, I introduced a bill that addresses the root of the problem – unprecedented spending in Washington.

Earlier this month, I reintroduced the Congressional Accountability Pay Act (H.R.284) to tie Members' salaries to the growth in federal spending - the more we spend, the less we make. For instance, if federal spending increases by 7%, congressional salaries are cut by 7%. This legislation ensures that Members of Congress are held personally accountable via their own paychecks. Just like families and businesses across America, Members of Congress need to be accountable for their fiscal decisions. Giving Members a personal stake in spending the tax dollars of the American people will reduce federal spending and rein in the growth of the national debt.

We must make it a priority to put our nation back on a path of fiscal prosperity. Members of Congress should not be afforded special treatment and be made immune from the economic challenges facing our nation. As public servants, we have much work to do to bring down our national debt and reduce deficit spending.  I believe that this bill is an important first step to show that Members of Congress are committed to returning America to a firm fiscal footing.

This chart compiled by the Republican Study Committee using data from the U.S. Treasury provides a look at total debt owed to foreign countries.

(Note that these amounts refer to foreign holders of U.S. debt.  For a look at a breakdown of total debt held by the public, click here).

After decades of overspending, we owe trillions of dollars to foreign countries.  Instead of a future of debt, doubt and decline, it’s time for real solutions. Here’s my plan of action to address government spending.

Also -

• Frequently asked questions about the debt and deficit
• The Balanced Budget Amendment is a game changer
• How the debt impacts jobs

This week, the House of Representatives approved – with my support – the Senate amendment to the Jumpstart Our Business Startups (JOBS) Act. (You can read about the House-passed version here). The JOBS Act is a bipartisan bill that will help remove barriers to job growth, jumpstart business startups and create jobs. The measure passed 380-41 and is headed to the White House for President Obama’s signature.

The path to economic growth is empowering America's businesses to prosper so they can, in turn, create jobs for Americans. The passage of the JOBS Act is an important step towards this goal, but there is much more that can and should be done.

Here's a list of House-passed bipartisan bills that are awaiting action from the Senate. 

(Click here or click the image below)

The President's FY13 budget request calls for more spending. Leaders in the Senate have refused to pass a budget for over 1,000 days. This type of budgeting is irresponsible and we are seeing the consequences in the fiscal health of our nation. America needs a new direction when it comes to our federal budget.

This week, House Budget Committee Chairman Paul Ryan released a budget blueprint for America. I want to make sure you have access to this budget proposal, so you can read it and analyze it and make an informed decision.

Read Full Report

Key Facts & Summary

A Contrast in Visions

The budget passed Committee this week and is expected to be voted on by the full House of Representatives next week.

I want to know what you think about this proposal - do you believe that this is the type of budget proposal that we need to move forward in America?