04.23.12

Sessions To Raise Point Of Order Against Postal Bill For Spending Billions More Than Debt Limit Agreement Allowed

“Spending and debt under the postal bill violates the debt limit agreement reached just last summer… This is particularly odd since the President and the Senate Majority Leader have accused the House of breaking the budget agreement by trying to save extra money for taxpayers. This argument, of course, is not sound… Not one word in that law requires you to max out the cap…

Only in Washington does spending underneath a cap get you accused of breaking a deal while spending more than an agreement means people just look the other way… The White House warns that Republicans want to cut too much spending. But the American people know the truth. And the truth is that we have never spent more money, more recklessly and with less accountability, than we are spending today.”

WASHINGTON—U.S. Sen. Jeff Sessions (R-AL), Ranking Member of the Senate Budget Committee, announced today that he will be raising a budget point of order against S. 1789, the postal reform bill. The Congressional Budget Office has scored the bill as adding $34 billion to the debt by 2022, spending more than the spending levels set in place by the Budget Control Act—levels set in law as the condition for the $2.1 trillion debt limit increase. The point of order has a 60-vote threshold to waive.

Sessions’ remarks, as prepared, follow:

“I come to the floor to discuss S. 1789, the 21st Century Postal Service Act.

The bill would increase the federal deficit by $34 billion. As a result, there are at least five budget points of order that lie against the bill, and I will be raising one of those points of order at the appropriate time.

Under Senate rules, no committee can bring a bill to the floor that spends even one penny more than is already going to be spent under current law, or increase the deficit more than it will increase under current law.

In other words, the spending and debt under the postal bill violates the debt limit agreement reached just last summer. In August, we agreed to modest, though insufficient, savings—in fact, discretionary spending will still increase $7 billion this year—and now the Senate is already planning to spend more than we agreed.

This is particularly odd since the President and the Senate Majority Leader have accused the House of breaking the budget agreement by trying to save extra money for taxpayers. This argument, of course, is not sound: The debt deal established basic spending caps—the maximum you can spend on discretionary accounts. Not one word in that law prevents you from doing your duty to try and save more money. Not one word in that law requires you to max out the cap. This is not a matter of interpretation: caps are the maximum, not the minimum, you can spend.

Almost everybody recognizes that deal was insufficient and the lawmakers trying to find more savings are doing their jobs and meeting their obligations.

Only in Washington does spending underneath a cap get you accused of breaking a deal while spending more than an agreement means people just look the other way. The Majority Leader and the Budget Committee Chairman are proud of the Budget Control Act, but where are they when it comes to making sure even these modest savings are enforced?

As this unfolds, you will hear some say that part of the reason it increases the deficit is that it requires the Treasury to repay the Postal Service $11 billion that the Postal Service has in the past overpaid for the retirement contributions for current employees.

I am not debating the overpayment. If the Postal Service has overpaid, then the government should refund their money. But owing a debt doesn’t mean you don’t have to pay for it. If a family owes money to the bank, the family still has to find the savings in their budget to make the payment. By the same token, Congress needs to cut spending elsewhere to cover the $11 billion.

But the $11 billion is only one-third of the bill’s debt impact. What else accounts for the $34 billion deficit increase from this bill?

Most of the deficit increase from this bill—about two-thirds—would occur because we are reducing the amount that the Postal Service is supposed to pay to the Office of Personnel Management for the future retiree health benefits of current Postal Service employees—coverage they will need when they retire.

In 2006, Congress enacted the Postal Accountability Act in an attempt to set the Postal Service on a self-sustaining course. According to one of the managers of this bill, that law included ‘a requirement the Postal Service endorsed at the time’ that the Postal Service pre-fund the future retiree health benefits of current postal employees on an accrual basis. And that 2006 law set out a schedule of those required payments.

Now—6 years later—the Postal Service does not want to make those required payments. We already enacted a bill last fall partially relieving the Postal Service of their required 2011 payment. So this bill would defer them and stretch out the amount of time in which the Postal Service can pay them. How much is the Postal Service allowed to defer? Nearly $23 billion! This legislation allows the Postal Service to defer $23 billion in payments for retiree health benefits. Since the bill drafters do not want the actual users of the Postal Service to pay for these health benefits over the next 10 years as required by current law, they are foisting those costs to the taxpayers.

This means that the Treasury has to go out and borrow $23 billion over the next 10 years because the Postal Service is relieved of making those payments.

Again, a budget produced under regular order could have and should have planned for this by including other policy changes that would have offset the deficit and debt increase caused by the postal bill.

Because it does not, I will raise a point of order and it will require the vote of sixty senators to waive it.

If this new spending is necessary, then isn’t it worth cutting spending somewhere else to pay for it? Do we really have to break our spending agreement before the ink is dry on it? At a time when we’re facing next year our fourth straight deficit in excess of a trillion dollars?

Washington is in a state of financial chaos. We are in denial. The Government Services Administration is throwing lavish parties in Las Vegas. The Government Accountability Office has identified $400 billion—$400 billion—being spent every year on waste, inefficiency, and duplication. Far worse, the Senate’s Democrat majority has failed to produce a budget plan in calendar years 2010, 2011, and now 2012. In fact, this Sunday, April 29th, marks exactly three years since the last time the Senate passed a budget.

A budget means responsible behavior. It forces Congress to make tough choices. And now, because the Senate can’t say no, and because the President refuses to exercise managerial discipline, we are set to spend another $34 billion in borrowed money.

The White House warns that Republicans want to cut too much spending. But the American people know the truth. And the truth is that we have never spent more money, more recklessly and with less accountability, than we are spending today.

This is a decisive moment. The point of order I will raise is not a mere formality. It is a crucial vote to see if the Senate will keep the agreement it made with the American people just last summer to reduce spending."