Floor Statements

Madam Speaker, some people say, why are you guys down here every night taking Special Orders, talking about what's going on?

I'll tell you why. I know we can't talk to the American people, but we need to make sure our colleagues, and if anybody is paying attention out there in the hinterlands, know what is going on in this place because it affects every person's life in America, every man, woman, and child.

I have got a chart here, and this chart shows the money supply. It's hard for people to see back in their offices, but this is the money supply, and it's been pretty consistent all the way up through maybe 1995, and since then it started to rise. That's the amount of money we print and is in circulation. Just after the 2007 time period, it shot straight up. It's going up like a rocket.

Now, what does that mean? It means right now we have created currency in this country that's almost 300 percent of what it was just a year or two ago. So people say what difference does that make? If you print that much money, it won't hurt anything.

But it does. Because the amount of goods and services, the cars, the refrigerators, and everything else that we

produce in this country, that's remaining flat right now because of the economy and the auto industry is going down. So we have got 300 percent, three times the amount of currency in circulation, but we don't have the goods and services going up at the same rate. So what happens? That means the cost of everything is going up, and that's called inflation.

Back in the 1970s we had inflation. It was double digit. It got up to 14 percent, and that led to 12 percent unemployment, which is worse than what we have today. And we ended up raising interest rates 20 to 21 percent because the spending had been out of control and we had to do something to slow down the inflation.

So here we have. We have the money being printed so fast that they can't keep up with it. In fact, I don't know how they buy enough ink and paper down there at the Treasury Department to do this. But every man, woman, and child ought to be concerned about this because the cost of government is going up so rapidly and the printing of money is going up so rapidly that they are going to have hyperinflation in this country.

My colleague Mr. Wolf from Virginia, I think he was here a couple weeks ago and he had a piece of currency from Zimbabwe and it was a multi-million piece of currency. They put so many zeroes on it, they had to reprint the currency just to take zeroes off. They just couldn't keep up with it.

Hyperinflation is what they had in Germany post-World War I. That is where people had to take bushels of money to the store to buy a loaf of bread, and every day the cost of everything went up this fast so that the people couldn't keep up with it.

So what we are facing today is a government where spending is out of control. We spent $700 billion on the TARP program; $14 billion on the auto bailout; $787 billion on the stimulus, over $1 trillion if you add interest; $410 billion on the bill that is over in the Senate. We have a budget coming up with $3.9 trillion and a $635 billion down payment on health insurance, a national health insurance program, socialized medicine.

Where is that money coming from? Well, we are borrowing it from China, we are borrowing it from Japan, we are borrowing it from other places in the world. We are borrowing it from the Social Security trust fund. But even though we are borrowing all that money, you can't keep up with the spending. And so what are they doing? They are printing more currency on a daily basis.

So you see this rocket ship taking off in the currency area, and it is not going to slow down, and what it is going to do is just lead to very high inflation, the cost of living going up. And it is going to affect every family in this country. It is going to affect the cost of education, the cost of gasoline, the cost of electricity, everything else.

So I hope my colleagues are aware of this. I hope they are aware that there are going to be a lot of tax increases as well. They are talking about putting a carbon dioxide tax in place that is $646 billion in new taxes. What that means is every time you switch on a light or buy a gallon of gas or do anything that is energy related, you are going to be paying a higher price for it because we are loading on the back of the taxpayers $646 billion in new taxes.

We are spending more money than you can imagine. We are adding to the national debt $12.3 trillion. People can't understand what that is. A trillion is a million million, so $12 trillion is 12 million million dollars. We are adding $12.3 trillion to the national debt, and that is more than we have added to the national debt from 1789 when we became a free country and had our Constitution to today. We are blowing money like it is going out of style.

When I tell people these things, their eyes just glaze over because it is too hard to comprehend. But what they do comprehend is higher taxes, more government spending, more pork-barrel projects and the kind of inflation that is going to lead this country down the road to socialism.

What we need to do, Madam Speaker, as I end up, what we need to do is we need to cut spending, cut out the pork and cut taxes and let the free enterprise system work.

You know, one of the things that concerns me is that we have spent trillions of dollars in the last few weeks, trillions. The people of this country were very concerned about the money they had in the banks so the Federal Deposit Insurance Corporation raised the amount of money from $100,000 to $250,000 so people will feel secure, they will know their money is safe in the banks. Yet today, the head of the FDIC, Sheila Bair, said the fund could become insolvent this year.

That is the craziest thing this woman could possibly say. If she wants to avoid a run on the banks and scaring the American people to death, she shouldn't be making these kinds of comments. To say that the FDIC is not going to insure the deposits of the people of this country is insane, especially at a time when everybody in this country is scared to death.

Mr. Speaker, things are happening so fast in this body and the other body and down on 1600 Pennsylvania Avenue at the White House, I don't see how Members of Congress--let alone the American people--can keep up with it.

Let us just take a quick look at what happened in the last 7, 8, 9 weeks. We got the second tranche of the TARP bill. That TARP spending was $700 billion. People can't get their arms around what $700 billion is, but $700 billion to save our economy.

And then the automobile industry had problems. And so we had an auto bailout, first tranche, of $14 billion. And then we had to have an economic stimulus package because the economy wasn't responding as we wanted it to. So we passed an economic stimulus that was $787 billion more; and with interest, that was well over a trillion dollars.

And we have an omnibus spending bill that's pending in the Senate right now tonight for $410 billion. And the President has a budget he's proposing to the Congress for $3.9 trillion, and $635 billion of that is the first down payment on a national health care of a socialized medicine approach for helping us with our health care problems in this country.

Now, yesterday, Senator Dodd and Senator Shelby were talking to the Fed and said, ``We want to know where this money's been going.'' And the Fed said, ``We're not going to tell you.''

Now, can you imagine the Senate Banking Committee or the House Banking Committee being stonewalled by the Fed saying, ``We're not going to tell you where we're spending these trillions of dollars''? And Geithner over at Treasury said he may have to put another $2 or $3 trillion into the financial institutions to keep the economy moving.

Now, you go past that and you say, What about taxes on the American people: $1.6 trillion increase in the budget, and the 2001-2003 tax cuts that we've put in place are going to expire. When those tax cuts expire, that, in essence, is a tax increase. And this is no time for a tax increase.

And the death tax, which we were trying to do away with so we could pass businesses onto the next generation without a huge tax liability that would run them out of business, they're going to do away with the death tax cut.

Now, in addition to that, we have what's called a carbon tax or an energy tax. That's going to be $646 billion in new taxes that's going to be passed on to the consumer every time they turn on their lights or buy a gallon of gas or use a lump of coal.

Now, they're going to reduce the mortgage deduction. If you've got a house and you've been deducting the mortgage interest on it, they're going to reduce. The administration and the Democrats in this body are going to reduce or try to reduce the amount of tax deductibility on your mortgage interest. And I'm sure that's going to be a reason to buy new houses when you do away with one of the incentives for people by doing away with part of their mortgage deduction interest on interest.

And then for charitable institutions--and this is happening so fast, you can't keep up with it. Charitable institutions--your church, the Salvation Army, the Boy Scouts of America, all of those whom you support and give money to--they want to reduce the tax deductibility for those contributions. Every charitable institution in this country ought to be marching on this Capitol saying, ``Hey. Enough. We need those tax deductions so we can encourage people to help us so the burden of helping people in this country doesn't fall completely on the Federal Government.''

But sometimes I wonder if this White House and this administration and the Democrats don't want the government to take over everything in a socialistic approach to government.

Now, the 2010 budget would increase the national debt by $12.3 trillion over the next 10 years, $12.3 trillion more. And that is more of the debt that's been accumulated since the beginning of the Republic in 1789 until today. That's how fast we're spending this money.

And in 2007, when my colleagues on the other side of the aisle took control of the Congress, CBO said we would have an $800 billion surplus in 10 years; and after 2 years of their leadership, instead of an $800 billion surplus in the next 10 years, we're going to have a $7.8 trillion deficit. Now, they'll try to blame that all on the White House, but they were in charge of the spending because they had control of both Houses of Congress.

Now, there was an article written just yesterday saying the money supply in this country has been increased by three times almost, 271 percent. What does that mean? That means we have almost three times as much money in circulation. It's being hoarded by a lot of people because they're scared to death. But when that money gets into circulation, we're going to have very high inflation. You're going to see the cost of bread and milk and gas and everything go through the roof.

Well, Mr. Speaker, there is so much more to tell and so little time. I will be back, and I hope the American people are paying attention, Mr. Speaker.

Mr. Speaker, the President of the United States stood here in the well the other night, and one of the things he said that was met with a great deal of applause was that there wasn't going to be one dime, not one dime of new taxes on anybody making under $250,000 a year, any family making under $250,000 a year.

And yet what was omitted from his talk was the cost to every single person because of a tax increase that's kind of hidden. It's called the cap-and-trade tax increase. And it's going to cost about $65 billion a year. And it deals with carbon dioxide emissions.

Every time we use coal or gas or any substance to create energy in this country, it emits carbon dioxide. And so $65 billion in new taxes are going to be levied on business that will be passed on to consumers in the form of higher prices on their electricity, their gasoline, their oil, their food and almost anything they buy, because anything they buy is made from energy. And the energy in this country is going to be taxed up to $65 billion a year with this cap-and-trade tax that the President's got in his budget. The American people simply don't realize that.

Now, there was an interview that was on Fox the other night. And I want to read to you just a little bit about that. First of all, let me just say that Peter Orzag, the former CBO Director and current OMB Director down at the White House, verified that energy taxes designed to decrease carbon emissions like those in President Obama's budget will be passed on to American families, and this will be passed on in the form of higher prices to every family in the form of higher prices for energy, food, lodging and everything else.

Senator Obama, when he was in the Senate, admitted during the presidential campaign, said, ``Under my plan of cap-and-trade, electricity rates would necessarily skyrocket.''

And on Fox the other night, Jim Angle was reporting on the cap-and- trade issue, and he said, ``Almost every activity in the U.S. economy emits carbon dioxide, but President Obama wants to impose a cap on total emissions throughout the economy and charge industry a new tax of at least $65 billion a year for their current activities.''

Now, when the President said he's not going to tax anybody, any family making under $250,000 a year, that's erroneous, because when you take the tax they're going to have to pay indirectly for the cost of food, lodging, energy of any kind, it's going to result in thousands and thousands of dollars to every family.

When you turn on your lights in your house, when this budget is passed, you will be paying much more money for your electricity. When you buy gasoline at the pump, you're going to pay more for your gasoline. When you get fuel oil or coal or anything else that you use for energy, you're going to be paying because of this tax that's being passed in this budget by this President.

And it's going to be on everybody, not just the people making under $250,000. It's going to be on everybody. Every man, woman and child who lives in this country that uses energy will be taxed. And I think the American people need to know that. That's why I'm down here on the floor, because when they say they're not going to raise your taxes, and that everybody making under $250,000 is not going to pay one dime more in taxes, they're not telling you the whole story. You are going to pay more in taxes and you're going to pay through the nose.

Madam Speaker, we have got severe economic problems. People are losing their homes. People who are staying in their homes are having a very difficult time making their payments, and we really need to do everything we can to help them.

Now, the Obama administration has a budget that they proposed, and I wish everybody in America was paying attention. I can't talk to them directly, but if they were paying attention, I would like to tell them that President Obama's budget cuts their mortgage interest deduction. It reduces their mortgage interest deduction.

So if you have a house, Madam Speaker, and you are paying your mortgage, the interest on that mortgage is tax deductible, and he is going to reduce, get this, he is going to reduce the tax deductibility of part of your mortgage interest.

I am sure that's going to really stimulate the purchase of homes and help the economy. This is not what he promised. It's going to be, in effect, a tax increase. And we have got charitable institutions around this country, churches, the Salvation Army, all kinds of charitable institutions that do so much good for this country. And we really, we really admire them for that, and we give money to them, and we deduct that money from our taxes because it's a charitable contribution.

And, you know, President Obama's budget is going to reduce the amount that you can deduct from your taxes for charitable contributions. Now, I don't know, I don't know what the purpose of that is. I guess he is trying to raise more money in taxes.

But the fact of the matter is those charitable institutions are going to get less money because you can't deduct all of that money from your taxes, as you have in the past. They are reducing it dramatically.

And so where are the people going to go who depend on those charitable institutions if they don't have the money to help them? Well, you guessed it, the government. We will just raise your taxes and spend more money on bailouts and everything else to help those who are in need.

But right now, if a charity wants to help somebody, we can give them money and we could deduct it from our taxes. I wish everybody in America realized this. We were promised so much, we were promised everything was going to be better, that taxes were going to be lowered, that everybody is going to be living better, and everything has been going south.

We are spending money like it's going out of style, trillions and trillions of dollars, so much money that people can't even comprehend it and our kids and our grandkids are going to be paying for it with higher taxes and very high inflation. And, folks, let me just tell you, my colleagues, that inflation ain't too far off, because as fast as they are printing money, it's going to happen pretty fast.

So let me just say to my colleagues and everybody, we really need to take a hard look at that budget, and we should not allow charitable deductions and the taxes on it to be reduced, the tax deductibility reduced. And mortgage interest, we should not allow there to be a reduction in the tax deductibility of mortgage interest. It will hurt the economy.

I hope President Obama is listening.

Mr. Speaker, we're not supposed to talk to the American people here. We're supposed to address our colleagues, so I will not talk to the American people. But if I could, I would say to them they ought to be very concerned about their constitutional liberties because they're being challenged and some of them may be done away with very quickly.

People who are members of companies, who work for companies, are going to be forced to do an open vote on whether or not they want to join a union if the Card Check Bill comes and passes this body or is passed by the administration through regulation. And this is something that would take away the right of these people to have a secret ballot on whether or not they want to join the union. That, in my opinion, is a violation of the first amendment.

And then also we have what's called the Fairness Doctrine they're going to try to pass, which would kill talk radio. The liberals in this body and the other body want to stop people like Rush Limbaugh and Sean Hannity from talking about the issues that face the American people because they're conservatives and they're making their points to the American people and the American people listen to them. They don't listen to the liberals, and so they're going to try to shut them up with the Fairness Doctrine. That's unconstitutional, and we should do everything we can to stop it.

I thank the gentleman for yielding.

Mr. Speaker, last night here in the well, the President said that there were no pork barrel projects in this bill, and now we find out there are over 9,000 pork barrel projects. Some people in the other Chamber said that the American people don't care about those pork barrel projects. I think they do.

And I think the American people care about our kids. We are stealing from our children and future generations. And let me just tell you why I say that.

We spent $700 billion in the TARP bill. We don't even know where half of that money went, $350 billion. We spent $14 billion on the auto industry. That's just the beginning. And there wasn't even a plan. If there had been a plan, it would have been a different situation. We spent $787 billion plus interest, which is going to take it over $1 trillion, on the stimulus bill, and we don't know if that's going to work. And we have got these 9,000 pork barrel projects that are in this bill, which is $408 billion. You add all that up plus the national health care, which the President said we are going to have to have here very quickly, and you don't have any idea how much money we're talking about. Mr. Geithner said $2 trillion is going to go in to help bail out the financial institutions. You add all of that up and it is an astronomical amount of printing of money and borrowing of money, and we don't have it. And we're borrowing from our kids and future generations.

And then on top of that, the President said he was going to cut the deficit in half in 4 years. That is not possible. It is just not possible. And I just hope the American people are paying attention, Mr. Speaker, because we're playing with funny money in this place and we're hurting the future generations of this country.

Offered By: Mr. Burton of Indiana

Amendment No. 1: Strike sections 101, 103, 105, 106, and

107 of the bill (and make such technical and conforming

changes as may be appropriate).

Mr. Speaker, if what I'm about to say wasn't so sad, it would be funny.

We've spent $700 billion in TARP, $14 billion for the auto bailout, and that's just the beginning, $738 billion in the so-called stimulus, and that does not include the interest that will take us over $1 trillion. $410 billion that's coming up in the omnibus spending bill, probably another $100 billion in supplemental. And the President today with his staff people down there was talking about national health care. Lord only knows how much that's going to cost.

And Mr. Geithner is spending 1 to $2 trillion, he says, to help the financial institutions in this country to stay above water.

And then the President said today he's going to cut the deficit in half in the next 4 years. It does not add up. How in the world are you going to do that when you're spending all this money, printing all this money, asking China to loan us more money? It just doesn't work. Somebody must be smoking something that's illegal.

Offered By: Mr. Burton of Indiana

Amendment No. 1: Strike all after the enacting clause and

insert the following:

Offered By: Mr. Burton of Indiana

Amendment No. 2: Strike all after the enacting clause and

insert the following:

Mr. Speaker, today we passed the largest spending bill in the history of the United States. When you add the interest and everything into it, it is going to cost over $1 trillion. I don't think the American people really understand how much $1 trillion is, but it is an awful lot of money.

I want to congratulate my Democrat colleagues on getting this passed. I certainly did not vote for this bill. I think it is going to be very detrimental to the future economy of these United States, and I think it is going to hurt our economy instead of creating the jobs that it was intended to create. So I think we made a big mistake today, but the Democrats got their bill passed, and they're going to get it passed in the Senate. It is going to become law, and every American is going to have to live with it.

One of the things that concerns me is not only the $1 trillion we have spent today but that Mr. Geithner, the Secretary of the Treasury, said the other day that we would have to spend another $1 trillion, $2 trillion or maybe even more to help the financial institutions of this country stay afloat. So we're looking at $2-, $3-, $4-, maybe $5 trillion.

If you will look at this chart, Mr. Speaker, it shows the amount of money that is in circulation. You will see it was pretty consistent at around $1 trillion-plus over the last couple of decades. Then just recently, it shot up like a rocket, and that was before all of this spending that we put through the House today or the amount of money that Mr. Geithner is going to spend. So we are looking at a tremendous increase in the amount of money that is going to be in circulation.

Now, one of the things that helps stave off this inflationary problem is that we have people around the world, other countries, that loan us money. For instance, China right now has loaned us $682 billion. That is what we owe them. We owe Japan $577 billion. We owe the United Kingdom $360 billion. We owe Brazil $120 billion to $130 billion.

China said just the other day that they were very concerned about loaning us money because they said that they did not think that the currency in the United States would be stable, so the value of their currency would go down. They were calling Mr. Geithner, Secretary Geithner, to say, ``Hey, we want some stability here because the value of the currency in our country is going to be depreciated because of what you're doing.''

Well, a day later, after it was brought up on this floor, they changed their minds and said, ``Well, the only place to loan this money where we have any kind of security is the United States. We are going to continue to loan money.'' So they are going to loan money to us in the billions and in the trillions of dollars, but the kicker is: How much is the interest going to be that they're going to charge? Because that interest is added to the loan that they are giving us on a month- to-month basis. I believe they kicked that interest rate up, so we are going to see an inflationary trend not only in the money they are loaning to us but in the interest that is going to be accumulating.

I know this is an awful lot for my colleagues to digest and for the people across this country who might be paying attention to digest, but let me just say this, Mr. Speaker: It is going to cause an inflationary trend at some point in the future. I think it is going to be earlier rather than later. When that inflationary trend starts, this chart is going to be minuscule to what we are going to see. We are going to see inflation shoot up at a very rapid rate, which means that the value of the dollar that every American has in their bank or in their home is going to be devalued.

That means, if you buy a car for $30,000, it may cost $60,000 or $90,000. If you buy a loaf of bread, it may cost 2 or 3 times as much or more. That is called hyperinflation. This happened back in the 1970s when we had a very similar situation to what we have today. We had double-digit inflation, double-digit unemployment, and they raised the interest rates to 21 percent to stop all of this. That may happen again. If it does, it will put a real hammer on the economy, and it will put more and more and more, thousands and millions of people out of work.

But the problem early on is the inflation that we are going to have to deal with. This is a problem that is very real, and I hope my Democrat colleagues will think ahead and will realize that we have to do something to stifle the growth in government and the spending because we are not going to be able to deal with this inflation as we should, and our kids and our grandkids and the future generations of this country are going to have to pay, not only with inflation, but with higher taxes and with a lower quality of life. That is something we should not have to deal with, Mr. Speaker.

China yesterday said that they held $682 billion of our debt and that they were very concerned about the ``reckless policies'' of our spending. And they were concerned so much that they contacted our new Secretary of the Treasury and said, We want some kind of a guarantee that our money is going to be worth something if you guys keep spending so much over there and devalue not only your currency, but the currencies throughout the world.

Well, today China reversed its position and said--Luo Ping, the Director General of the Chinese Banking Regulatory Commission--said in a speech in New York, ``We're still going to buy your Treasuries because where else are we going to put our money, because the United States is still the biggest economy and the best place to put our money. But we're really upset with you because you're devaluing your currency, and you're going to be devaluing ours as well.''

And he said this, ``Except for U.S. Treasuries, what can you hold? Gold? You don't hold Japanese government bonds or UK bonds. U.S. Treasuries are still the safest haven. For everyone, including China.'' But, you're devaluing your currency over there, and we don't want ours devalued, but we don't have anyplace to go.

He said further on, ``We hate you guys,'' using his language, ``We hate you guys. Once you start issuing $1 trillion, $2 trillion or more in dollars, we know the dollar is going to depreciate, so we hate you guys, but there's nothing else we can do.'' Now what does this tell us as Americans?

This is a chart showing the amount of money in circulation in the United States. And you can't see--my colleagues who might be watching in their offices--but you can see the amount of money in circulation was pretty steady up until about the last 10 or 12 years, and then you see it has just risen like a rocket. It's just gone straight up. And that's before we started all this spending we are talking about right now, which worries not only us but the Chinese and Japanese and others that hold an awful lot of our debt and are buying more right now as we speak.

What's going to happen tomorrow is we're going to spend another $800 billion. Almost $1 trillion. The Secretary of the Treasury said the other day that he was going to have to put probably another $1 trillion or maybe even $2 trillion into the banking system in this country to make sure everything continues on the right path.

We are going to spend another $400 billion in an omnibus spending bill in a couple of weeks. So we are looking at probably $2 to $3 trillion in additional spending before too long, and it's going to probably triple the amount of money we have in circulation over the long haul. In the short haul, maybe only about half of that. Maybe only $1 trillion or $1.5 trillion.

But what that means is the amount of money in circulation is going to go up like a rocket. And that is what we call inflation, because the amount of goods and services produced by this country is not increasing at a rapid rate right now because of the economy. And so we are going to have pretty much the same amount or maybe a little bit less of goods and services being sold in this country, but we are going to have almost twice as much money.

So, the amount of money chasing goods and services is going to double, which means when you go to buy something, it's going to cost a lot more. If you have 100 quarts of milk, and I used this illustration the other night, and you have $100, then a quart of milk is going to cost about $1. But if you double the amount of money to $200 or $300, then the quart of milk is going to go up at the same rate. That's the law of supply and demand. And we're putting so much money in circulation that we are going to have, in my opinion, hyperinflation.

Now we had this back in the 1970s. It was worse then than it is now. Jimmy Carter was President. We had double-digit inflation. Fourteen percent. That's what we call hyperinflation. It will probably be worse than that now. We had double-digit unemployment. We have 7 percent now. It was 12 percent back then.

And so they brought a guy in named Volcker to do something about it. And he raised interest rates to 21\1/2\ percent, and we had the worst recession up until that time for probably 30 or 40 years. And then Ronald Reagan was elected. He came in and he cut taxes and stimulated economic growth. We had one of the longest periods of income recovery in American history.

We are doing the same thing today that Carter did back in the seventies. I don't think my colleagues--most of them--remembered that, because they are too young. And we are not going to profit from history. But what we are doing is we're throwing money at the problem instead of solving the problem by creating an economic recovery.

The way to create an economic recovery is to give business, industry, and American citizens as much of their tax money back as possible so they can spend it. They can spend it more wisely than the government of the United States. And if you ask all of your neighbors, said, Who could spend $100 better, you or the government? And most of them will say, We can.

We have got to control spending, and we're not doing it. We're heading in the wrong direction. We're printing money. We're going to be printing money at a very rapid rate, and it's going to cost everybody in this country and the future generations a great deal, not only in inflation, but more taxes and the quality of life.

Mr. Speaker, this chart shows the amount of money that we have in circulation in dollars. And, as you can see, that up until recently there wasn't a great deal of increase in the amount of money in circulation.

But, just in the last few years, last couple of years, it has shot straight up. Straight up. That means that we are seeing an inflationary trend unparalleled in American history. But that is not the end of it. People need to know that their money is going to buy a lot less if we continue down the road we are on.

Now just to let you know where some of the money is that is not on this chart, China has given us about $690 billion in loans. And, just this week, leaders in the Chinese government said that they were very concerned about the value of those loans being eroded by ``reckless policies'' in the United States of America. The U.S., ``should make the Chinese feel confident that the value of the assets at least will not be eroded in a significant way.''

And Secretary Geithner of the Treasury has been told this. And yet he said just today that there could be as much as $2 trillion printed and put into circulation, at least a large part of it, because who's going to loan us money when the Chinese, who are the biggest holders of our debt, are saying that they want guarantees that the value of the currency is not going to go down. And so who's going to buy these loans? The Social Security trust fund has an awful lot of that money, and it's already bankrupt.

But the fact of the matter is the Treasury Department of the United States, in my opinion, and I'm very sure this is going to happen, they are going to have to print more money. Billions and billions of dollars in additional money. And when they put that into circulation, the law of supply and demand is going to make it very clear that everything that we buy is going to cost a heck of a lot more.

Now, if you have $100 and 100 quarts of milk, a quart of milk would cost $1. But if you triple the money supply and you have $300 and 100 quarts of milk, it's going to cost $3 for a quart of milk. And that is the way inflation works.

This is a very clear signal that our money supply is going up like a rocket right now. And Secretary Geithner is talking about $2 trillion more in addition to what they are talking about in the supplemental. The supplemental is over $800 billion, almost another trillion dollars. The omnibus spending bill which we are going to be passing is $410 billion. And there's a $100 billion supplemental.

Now think about that. Where is all that money going to come from? You can't give people something unless you take it away, as far as taxes are concerned. So we can't tax people that much. And so what they are going to have to do is they're going to have to inflate the money supply. And they are going to do it.

The manipulation of our money supply is something that everybody in this country ought to be concerned about. They really should be concerned about it because the value of the money you have in the bank, and a lot of people have already lost a ton in the stock market, but the value of the money that you have in the bank and under the mattress, or wherever you keep your money, is going to be devalued dramatically because they are going to print so much more money. So there will be trillions of dollars more chasing the same amount or fewer goods and services.

And everybody in America ought to be saying that we have got to put a hammer on the spending and put a hammer on these big policies that we are coming up with right now. I don't think people realize, honestly.

I understand we have economic problems, but this is going to put our kids, our grandkids, and our posterity in one heck of a situation because they are either going to be taxed to the limit, or way above the limit, or they're going to have to deal with an inflationary spiral that means that the amount of money they have won't amount to anything.

In Zimbabwe right now, one piece of currency is worth about 12 million of their former currency. So they just put more zeroes on it. When people go to buy bread or food, they have to take buckets of money. That happened in

post-World War II Germany. And we are going to do it here right in the United States if we don't get control of spending. This is real, folks. This isn't baloney.

Geithner said today he may have to monetize up to $1 trillion, or get loans for $1 trillion or $2 trillion; $410 billion in the omnibus; $800-plus billion in the stimulus; $100 billion in the supplemental. I mean where is this money going to come from? Where is it going to come from?

So, I'd just like to say, Mr. Speaker, to my colleagues and the American people, This ain't baloney. This is real dollars and cents. This is the future of our kids, our grandkids, and the future of our system of government in the United States of America. We must not let this happen. We must not let this happen.

The National Debt currently stands at approximately $9.13 Trillion.

$4 Trillion of this debt is owed to Social Security and other government accounts.

$5.1 Trillion of this debt is held as ``Public Debt'' by banks, pension funds, mutual fund companies, ordinary citizens, State and local governments, and increasingly, foreign governments.

As of November 2008--the latest figures available from the Treasury Department--$3.08 Trillion of our ``Public Debt'' is held by foreign countries:

Top Six

[In billions of dollars]

Country U.S. Debt Held Mainland China....................................................681.9 Japan.............................................................577.1 United Kingdom....................................................360.0 Carib. Banking Centers............................................220.9 Oil Exporters.....................................................198.0 Brazil............................................................129.6 Carib. Banking Centers include Bahamas, Bermuda, Cayman Islands, Netherlands Antilles, Panama and the British Virgin Islands Oil Exporters include Ecuador, Venezuela, Indonesia, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Gabon, Libya, and Nigeria. $1.517 Trillion of the ``Public Debt'' is outstanding as T-bonds and Notes. $427.2 Billion is outstanding as Treasury Bills. $1.944 Trillion appears to be loans held by Foreign Governments. * We are unable to determine the interest rate on our National Debt but we do know that interest payment on the debt for FY 2008 (when our outstanding debt was smaller) was $430 Billion.

The Problem

In addition to a $410 billion Omnibus, Congress is poised to enact an $800 billion Stimulus and a $100 billion Supplemental.

Added to CBO's projected deficit of $1.2 trillion, Congress's legislation will force the Bureau of Public Debt to attempt a borrowing of $2.1 trillion this year.

This is over four times the amount of new debt ever sold by the United States.

How Does the Government Actually Borrow Money?

The Federal Government currently owes about $10 trillion: $6 trillion to private lenders and $4 trillion to Government trust funds, mainly Social Security.

Most of the debt owed to private lenders is short-term debt--owed for less than a year. Last year, the U.S. Government sold over $6 trillion in debt as it refinanced short-term debt and added to this number due to the deficit.

When Congress approves the Stimulus and related spending bills, our action will force the Bureau of Debt to attempt to sell $2.1 trillion of our debt. Back in 2000, the U.S. auctioned debt 145 times. With borrowing exploding, our debt was sold 263 times last year and the number will rise dramatically after enactment of the Stimulus.

Between the short-term current debt to be refinanced and the new debt sold, the Bureau of the Debt will attempt to borrow nearly $150 billion a week from world markets.

While the number of primary purchasers used to top 40, only 17 ``primary dealers'' buy U.S. debt today.

As recently as 2003, most purchasers of U.S. debt were American. Now the buyers are mainly foreign, with China topping the list of purchasers.

Who Will Buy Federal IOUs?

We can already see warning signs of offering so much debt for sale.

After buying over $1 trillion of U.S. debt (including over $300 billion of Fannie Mae and Freddie Mac), China's desire for buying more American IOUs is waning.

Fitch Ratings reported that China's purchases of U.S. debt will decline from over $400 billion last year to just $177 billion this year.

China announced recently that it will decrease its buying of foreign securities worldwide as it borrows for its own $586 billion stimulus program.

Other Governments Are Competing for Investors Still Willing to Buy

The debt the U.S. will sell will compete with other governments wanting loans.

The European Union, Japan, China, South Korea and 10 other governments announced 2009 borrowing plans of their own totaling another $1.2 trillion. One question we might ask--who has the money to purchase all of this U.S. and foreign government debt?

Treasury officials express confidence that there are plenty of entities willing to lend the U.S. Government money. In these uncertain times, there is a ``flight to safety'' in U.S. treasuries. Last year, we borrowed $6.7 trillion against the $17 trillion offered. With such demand, why worry?

Unfortunately, this year conditions are changing. With the U.S. offering four times the amount of new debt ever offered and Chinese willingness to loan us money disappearing, there may come a time when the interest we have to pay to sell our debt goes up. Most of our debt is held for less than one year.

Any increase in the interest we have to pay to sell our debt will effect interest rates and constrain the Federal budget. Reuters recently reported that the ``Fed faces uphill battle to hold U.S. yields down.''

The Wall Street Journal reported, that the Fed may enter the market as a direct purchaser of U.S. debt. If demand for U.S. debt was so strong, why would the Fed join the current list of 17 purchasers of U.S. debt to hold an auction? Are they worried that with so much debt to sell, they may be needed to save an auction?

What Happens if We Cannot Sell More Debt?

The worst case scenario would be an auction of Federal debt that failed to attract enough buyers.

Recently, the German government failed at an auction of its government debts.

Such an event in America would trigger another panic. Since U.S. debt auctions are reported openly within 90 seconds, a failed U.S. auction would trigger a panic on Wall Street long before Treasury officials could get the President on the phone.

How Much Will All This Debt Cost?

Beyond the short-term concerns about quickly borrowing $2.1 trillion, we should be concerned about the long-term.

There are only 111 million American individuals and families who actually pay taxes.

Their pre-Stimulus debt per taxpayer totals $54,000 each.

After adding $2.1 trillion to the $6 trillion currently owed, their debt rises in just one year to $75,000 each. Each family's debt will total more than a college education.

Interest payments for the Government are rising too. In 1980, interest on our debt cost $52 billion. Last year, the payments were eight times more--$412 billion.

To maintain faith in our dollar, these interest payments must be made before the first Social Security check or salary of a soldier can be covered.

Conclusion

In these times, it is easy to see where Stimulus dollars will be spent. But before we approve such legislation, we should answer two other questions: (1) should we borrow this money and if so, (2) can we borrow so much money in just one year? Never in the history of our nation have we borrowed so much from so few.

First of all, let me thank you for taking this Special Order and if you wouldn't mind I would like to put that chart up there for just a minute and then we'll take it back down.

That chart shows a line that shows the amount of money in circulation. And you can see that it was pretty constant up until, I think, right in the middle of the eighties or maybe in the nineties. And then you see it shot up like a rocket. And that's because we had to print more money and get it into circulation and that's called inflation. And when we start having inflation like that, the cost of doing business, the cost of buying products, everything goes up, goes right out the window. Now they're talking about putting trillions of dollars back into this economy, and it's going to be borrowed money. It's going to be borrowed from the taxpayers. And a lot of that is going to have to be printed, which means we're going to have more and more dollars in circulation, so we're going to have very high inflation, and some people believe it will be hyperinflation.

I would just like to say to my colleague that back in the 1970s, when Jimmy Carter was President, we had the same identical problem, only worse. And back then, the inflation went to 14 percent. Unemployment went to 12 percent. And then they brought a guy in named Volcker, who is back here again today.

Fourteen percent.

The unemployment rate was about 12 percent.

Well, Mr. Volcker, who is now back with this administration, he came in and started ratcheting up the interest rates to slow down the rate of inflation. Interest went up to 21.5 percent. And I had a business then. And we had to close our doors, because we couldn't sell real estate because nobody could afford to buy it at 21.5 percent interest. And so what happened was he ratcheted up the interest rate to slow down the rate of inflation. And he killed the economy. He absolutely killed it. And that is when Ronald Reagan was elected in 1980, and he came in with tax cuts which stimulated economic growth. And we had one of the longest periods of economic recovery in history.

Let me just conclude by saying this. The economic problems we had in the 1970s were almost identical to the ones we have today, but they were worse. And the economy got out of control. Inflation got out of control. Unemployment got out of control, and it ended up killing us, killing the economy with rising interest rates of up to 21 percent.

The way to solve the problem is what my colleague just said, and that is to cut taxes, as Kennedy and Reagan and Bush did, to stimulate economic growth. If we do that, we won't have to deal with these inflationary problems. These inflationary problems are going to be borne not just by us, but by our kids and our grandkids. And they will be paying four, five, 10, 15 times what it costs today for bread, milk and everything else if we don't cut this spending out and quit wasting all this money. And then, of course, they will probably get stuck with taxes and less defense and things that are very important.

So I would just like to say to my colleague, and anybody who is paying attention, we're going to see hyperinflation. Today, Mr. Geithner, the Secretary of the Treasury, said he was going to have to put another $1 trillion or maybe $2 trillion into the financial institutions to make them viable again. That is going to be money that is not going to be sold on the market to borrowers. A lot of the money is going to have to be printed. And we're going to have very high inflation. And we don't really need it.

That is what is taking place already. There is a spike in inflation already, and people are starting to feel it. When you go to the supermarket and you buy a pound of something that you used to pay for a pound, now they're putting the same product in a bag, but they're only giving you two-thirds of a pound. And that is because they want to keep the price constant. But there are inflationary pressures right now. It is already existing. And what Geithner and what we're doing with this so-called stimulus package and the other legislation that is going to be coming down the pike is going to make this thing a lot worse. That is why we need to do as you said and as our colleagues said, cut taxes and get this economy moving in the right direction again.