Grassley Statement at Hearing on "Rising Seas, Rising Costs"

 

One week ago, the Congressional Budget Office released its budget and economic outlook. This non-partisan report provides us a much-needed fiscal reality check on the state of our nation’s finances.

Grim, dire, bleak. All have been used to describe budget projections in the past. Amazingly, they don’t do justice to the fiscal mess staring us in the face today.

Debt held by the public climbs from $26 trillion this year to more than $46 trillion by 2033. As a share of the economy, public debt will exceed the World War II era record beginning in 2028. Debt only grows from there—reaching 195 percent of our economic output by 2053.

We used to be concerned about deficits around here. Then it became a question of preventing trillion dollar deficits. CBO now tells us we’ll be knocking on the door of a nearly $3 trillion deficit in 10 years. Our deficits will consistently exceed levels once only reserved for periods of recession or war.

One of the most disturbing stories from the CBO report is the rapid growth in interest costs. A mounting debt and rising interest rates means that our interest costs will grow by 35 percent—increasing from $475 billion in 2022 to $640 billion—this year. By 2033, interest alone will cost taxpayers $1.4 trillion. After surpassing defense spending in 2028, interest will surpass Medicare spending by 2044 and Social Security by 2050.

Unfortunately, CBO’s outlook for the economy is just as bad. The agency expects the economy to stagnate this year—teetering on edge of recession. The unemployment rate is projected to rise above 5 percent. Higher interest rates will strangle families buying a new home and farmers and entrepreneurs expanding their businesses.

When it comes to inflation, CBO confirms what Republicans—and, I suspect, many Democrats—knew all along: last year’s partisan, tax-and-spend reconciliation bill, which Democrats had the nerve to try to call “Inflation Reduction Act,” will actually increase inflation. So much for truth in advertising.

CBO now tells us it’ll take years for inflation to return to the Federal Reserve’s two percent target. That’s cold comfort for millions of families struggling with higher prices everywhere from the grocery store to the barbershop.

So that brings us to today’s hearing. The second one that we’re told is part of an extensive series on the environment. Last hearing, we were told we needed to focus on climate because of the potential budget and economic effects by the year 2100. Yet, challenges we have today arising from structural deficits and pending trust fund insolvencies are not being focused on by this committee.

To borrow a phrase of yours Mr. Chairman, it’s “time to wake-up” to the serious fiscal challenges we face as a nation.

Let’s talk about climate change. But let’s also recognize that the climate is not the cause of every issue or challenge facing Americans, whether in my home state of Iowa or the communities on our coasts. When I talk to fellow Iowans, I’m more likely to hear concerns about inflation, fentanyl overdoses, increases in crime, and a Southern Border that is being overrun.

Few understand the impact of weather events on coastal communities better than Dr. Weinkle, who is joining us virtually from the University of North Carolina Wilmington. She has dedicated her career to studying the impact of natural disasters and flooding on our coasts. I look forward to hearing her reasoned perspective on the costs of natural disasters.

While the extent of human influence on sea level rise is unclear, it’s true that sea levels are rising. But, the United States and many countries around the world have the knowledge and expertise to adapt.

In the U.S., the Army Corps of Engineers, which is tasked with the evaluation, construction, operation, and maintenance of projects to reduce flood risk, received $29 billion in appropriations last fiscal year. This total doesn’t include other federal agencies or private-sector efforts to mitigate flooding and weather-related risks on our coasts. It’s clear that we’re already engaging in sensible adaptation, resiliency, and mitigation efforts to reduce the impact of flooding and weather events.

Rather than panic, we should take a sober approach to assessing public policy options to address climate or weather-related challenges. We should also determine if climate change is really the primary source or just one of the many issues at hand that determine sea levels. I welcome Dr. Lewis, who will discuss questionable sea level rise statistics and natural disaster assertions cited by some. He will also address the consequences of market-altering policies proposed by many of my Democratic colleagues.

I thank all the witnesses for their willingness to testify and look forward to their testimonies.

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