Over the Easter break I continued my annual 99 county meetings. And, as always, Iowans set the agenda.
At my open town meetings, I had big turnouts. People shared strong views about tariffs, deportations and the Department of Government Efficiency.
At nearly every one of those Q&As, Iowans also raised concerns about the federal deficit and the $36 trillion debt hanging over our heads.
I’m sharing this feedback with my colleagues here because that’s what representative government is all about. And it seems like no matter which issues put a burr under their saddle, my constituents are hungry for the same thing.
So simply, they’d like to have some certainty of policy coming out of Congress. Such predictability is very essential for our country to move forward economically.
Some people see Washington in chaos.
These feelings of uncertainty keep Americans up at night.
Workers are worried about their retirement savings when they watch the stock market seesaw.
Farmers are wondering if they’ll have a market to export their grain.
Small businesses are worried that rising import costs will drive them into the red or force them to jack up prices on their customers.
And everybody’s concerned that come January 1, 2026, they could be subject to the largest tax hike in U.S. history. And that’s without even a vote of Congress.
I’ve long been an open book regarding my concerns about tariffs. I consider myself, what around this town, we call free and fair traders, negotiating tariffs down. That said, the President has another approach.
President Trump has raised valid concerns about some of our existing trading relationships, especially with China.
That’s why I’m willing to take a wait and see approach as Trump’s trading partners come to the negotiating table.
I hope his policies will ultimately result in free and fairer trade. If they do, he will be much more successful than my approach over the last 50 years.
So, if he is successful, I’ll be the first one to say Praise the Lord.
But, in the meantime, it’s clear the on-again, off-again tariffs are driving uncertainty and that uncertainty’s the same that’s reverberating across our economy.
There’s no better example than when the market for U.S. Treasuries went haywire at the beginning of April as a result of some of this tariff talk.
Foreign investors got skittish and actually dumped U.S. Treasuries. That caused interest rates to spike on the ten- and thirty-year bonds.
That should have set off alarm bells here in Congress.
American taxpayers are on the hook for our $36 trillion national debt.
Americans are already paying $1 trillion a year in interest payments – about three times what they were before interest rates and inflation hit us after the last four years. This $1 trillion is more than we spend annually on national defense, and in the end, we don’t have anything to show for all that interest.
Don’t forget, those costs rise when interest rates rise. If we pay more servicing on our debt, there’s less money for everything else that the federal government does to help the American people.
Given the size of our national debt, even slightly higher than expected interest rates means trillions more spent servicing our debt over the next decade.
Worse yet, if our bond holders were to lose confidence in our ability to budget or govern responsibly, soaring debt payments could trigger a return of sky-high inflation, or even end America in a fiscal crisis.
In 2023, the credit rating agency Fitch downgraded the U.S. credit rating, noting the size of our national debt and “the erosion of governance.” And those words, “erosion of governance” are from the Fitch report.
More than ever, Congress must step up its game to provide stability in the form of good governance and fiscal restraint.
This means we must work to deliver on essential congressional functions without the last-minute brinksmanship that has become a norm.
When either we don’t appropriate for next year and government should shutdown or, like I’m going to talk about, the national debt and the debt ceiling coming, and if we don’t handle that issue, we can possibly shutdown the government.
Now, along the lines of what I’m talking about, I’d like to delineate three “must do” items on our agenda that needs to be completed before October 1 of this year.
First, we must pass a tax and spending package to avert a massive tax hike on the American people. That must include resources for the administration to secure our borders and beef up our depleted military.
Second, we must guarantee we will always pay our debts. This means we must raise the debt ceiling well in advance of Treasury running out of money to pay the bills.
Currently, we’re expected to hit the debt ceiling in mid-summer to early fall. So common sense tells me we should avoid the chaos in the bond market, which could cause our debt payments to skyrocket.
We must lift the debt ceiling with plenty of room to spare.
Why wait until the midnight hour of government shutting down? That’s too often the practice around here in the United States Senate.
Finally, we must fund the government to avoid the threat of that government shutdown.
Our rinse-and-repeat shutdown stare-downs have become an unnecessary, recurring source of heartburn for our constituents and delivers unnecessary uncertainty for the economy. We can surely do better.
Completing our must-do list on-time and drama free begins with passing the tax and spending package in a timely and fiscal[ly] responsible fashion.
I know what it takes to grease the wheels and enact historic tax cuts using the budget reconciliation process. It’s a four-letter acronym, K.I.S.S. – in other words – keep it simple, senators.
The 2017 Trump tax reform was an historic achievement. We cut taxes across-the-board.
We did so by simplifying the tax code and trimming back the special deductions and credits.
As a result, most taxpayers pay less tax simply by claiming the increased standard deduction that was in that 2017 law. They’re able then to avoid the headache of spending hours sifting through receipts and IRS forms.
We now have the chance to make these tax cuts and reforms permanent.
This alone would take the weight of a four trillion-dollar tax hike off the chest of the economy. That would provide much needed certainty to families and businesses.
So, we must keep our eye on the ball. Let’s avoid the laundry list of costly new items we can’t afford. We ought to simplify, not complicate the tax code. Or else, we risk slamming the brakes on moving the reconciliation package across the finish line.
We’re coming off an unprecedented peacetime spending binge and it is time to pay the piper.
The fact is, the federal government is broke. We’re currently running $2 trillion annual deficits. And, in just three years, our national debt is set to eclipse the World War II-era record relative to the size of the U.S. economy.
Let’s get in the habit of paying for all new policies, so we don’t continuously keep digging ourselves into an ever-larger fiscal hole.
Let’s stick to common sense: when you find yourself stuck in a hole, stop digging. Start climbing.
This will require senators, congressmen and congresswomen and President Trump, to set priorities and be willing to make tradeoffs.
Let’s move forward with consensus spending reductions. Let’s pull back expensive Biden-era regulations that supercharged mandatory spending programs – and, at the same time, who’s going to argue with the eliminating [of] waste, fraud and abuse?
Relative to new tax and spending policies, the overall package must result in significant deficit reduction – but we can’t let the good be the enemy of the perfect.
We didn’t get into our fiscal situation – the present situation – overnight, and we’re not going to solve it in this single bill either.
Polling repeatedly shows Americans hold Congress in low regard. I’ve said this before, but it bears repeating.
At my county meetings, someone will yell at the back of the room: “Grassley,” – referring to me – “Why can’t you do something about the deficit?”
We can begin to restore [the] public’s confidence in Congress by doing our jobs, getting our work done on time, and Ye Gods, stop digging a deeper fiscal hole.
I yield.
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