(Washington, DC) – Representative Larry Bucshon voted “Yes†on H.R. 807, the Full Faith and Credit Act, a bill introduced by Rep. Tom McClintock (R-CA) that credibly and permanently removes any threat of default on the United States’ Treasury debt. H.R. 807 accomplishes this by requiring the U.S. Treasury Department to assure the full and prompt payment of principal and interest on the debt – effectively eliminating the threat of default as an option during debt negotiations.
This will only go into effect in the occurrence that the debt limit is reached and the Treasury Department does not have the authority to issue debt on new spending.
Representative Bucshon (IN-08) released the following statement:
“Our national debt is reaching $17 trillion dollars. We need responsible solutions that will address our spending problem while preserving the full faith and credit of the United States.
“The Full Faith and Credit Act is absolutely essential to moving forward with meaningful debate on how to address our nation’s growing debt. In previous debt ceiling negotiations, the President and his allies in Congress have used the threat of default to negotiate for increases in taxes and spending. H.R. 807 removes this tool and ensures that default is completely and clearly off the table during these discussions.â€
“Even the threat of default creates instability in our markets, uncertainty with our families, and compromises our role as a global economic leader. This bill makes sure that we live up to all of our obligations.â€
BACKGROUND:
Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen has stated that, “Our national debt is our biggest national security threat.”
The current debt limit of $16.4 trillion consists of both debt held by the public and debt held by the government, which carry the full faith and credit guarantee.
Public debt includes securities the Treasury Department has issued to investors, which amounts to $11.5 billion. The balance is debt held by the government in the form of non-marketable Treasury securities, the majority of which, $2.7 trillion, is held by the Social Security Trust Funds.
Earlier this year, the House passed, and the President signed into law, H.R. 325, the No Budget, No Pay Act, which included a temporary suspension in the debt limit until May 19, 2013.
On May 19th, the limit will be recalculated to account for amount borrowed through May 18, 2013, becoming the new statutory limit. At this time, the Secretary will more than likely have to utilize extraordinary measures to pay our nation’s obligations. However, with federal revenue up 12 percent to $1.197 trillion for the first half of FY 2013, the Secretary is expected to have enough resources to pay obligations until sometime early fall.
