October 18th, 2009
03:08 PM ET
5 years ago

Gregg: U.S. could be on path to a 'banana republic' situation


WASHINGTON (CNN) – A leading fiscal mind on Capitol Hill and a one-time Obama Cabinet pick sounded the alarm Sunday over the projected long-term financial challenges the country faces.

“This deficit is driven by us,” New Hampshire Republican Sen. Judd Gregg candidly said Sunday on CNN’s State of the Union when asked about the federal government’s projected $1.42 trillion operating deficit for the 2009 fiscal year.

“You talk about systemic risk. The systemic risk today is the Congress of the United States,“ the Ranking Republican on the Senate Budget Committee told CNN Chief National Correspondent John King, “that we’re creating these massive debts which we’re passing on to our children. We’re going to undermine fundamentally the quality of life for our children by doing this.”

“Now you can’t blame that on [former President] George [W.] Bush,” Greg said, noting that using the Obama administration’s projections the budget deficit for the next ten years is $1 trillion per year. And Gregg said that during the same ten-year period, public debt as a percentage of gross domestic product would increase from 40 percent - which Gregg called “tolerable but still too high” - up to 80 percent.

The figures, Gregg told King, “mean we’re basically on the path to a banana-republic-type of financial situation in this country. And you just can’t do that. You can’t keep running these [federal] programs out [into the future] and not paying for them. And you can’t keep throwing debt on top of debt.”

“Standards of living will drop if we keep this up,” Gregg also said.

After repeated promises from the White House that the final health care reform bill will be deficit neutral, Gregg said a Democratic plan to avoid otherwise automatic Medicare cuts without having a funding source for the projected expense of $250 billion over the next decade was “gamesmanship.”

Asked about criticism leveled Sunday by former Republican-turned-Democrat Sen. Arlen Specter of Pennsylvania that Republicans were being obstructionist in the health care reform debate, Gregg replied, “Well, I suppose he has to call us something now that he’s left the party.”

Responding to the Democratic charge that the GOP is “the party of ‘no,’” Gregg pointed to Republican health care reform proposals including his own and another co-sponsored by Republican Sens. Tom Coburn and Sen. Richard Burr, as well as a bipartisan proposal put forward by Sens. Ron Wyden (D-OR) and Robert Bennett (R-UT).”

Gregg said the versions of health care reform voted out of the Senate Finance Committee and the Senate Health, Education, Labor and Pensions Committee would amount to “a huge expansion of government.”

“You’re talking about taking the government and increasing it by $1-$2 trillion over the next ten years,” Gregg said. He added that he thought growing government at that rate would have a “very debilitating effect” on the overall economy and the ability of Americans to get health care in the future.

At one point earlier this year, Gregg, who is not seeking re-election to his Senate seat in 2010, was President Obama’s choice to head the Commerce Department. But the fiscal hawk removed himself from consideration because of differences with the new administration on several policy issues.


Filed under: Health care • Judd Gregg • Popular Posts • State of the Union
soundoff (105 Responses)
  1. LacrosseDad

    Gregg, the community organizer told us that 1 1/2 years ago when he said HE was going to fundamentally change the United States. His vision is socialism and beyond.

    October 18, 2009 05:52 pm at 5:52 pm |
  2. John From Brooklyn, NY

    The problem with irresponsible Republicans like Gregg is that they use the rhetoric of "tax and spend" against the Democrats...preventing a meaningful discussion of finding the means of PAYING for the programs. The Republicans' solution is to strip the government of its duties to the people so that they can slash taxes for the rich. If everyone were paying their fair share, the deficit wouldn't be a problem.

    Remember...Clinton left Bush a budget SURPLUS!

    October 18, 2009 05:53 pm at 5:53 pm |
  3. Felix Thomas

    John King is bias he has these Republicans on his show and asked them all these leading questions against the President and the Democrats. John is not neutral, he is a Republican.

    October 18, 2009 05:53 pm at 5:53 pm |
  4. Eric of Reseda

    Again, where were all these fiscal conservatives while Bush & Co. were taking us deeper and deeper into the Middle East quagmire? Where were they on the Bush tax cuts and rebates that played a significant role in this mess? Where were they when Bush l continued the unconscionable deficit spending began by Reagan? All while corporate fat cats were getting richer off public money? Gregg is a tool of an INCREDIBLY corrupt GOP, a party which has declared war on the Middle Class and the Poor.

    October 18, 2009 05:55 pm at 5:55 pm |
  5. T Mckinley

    If Sen. Gregg is SO concerned about a "huge expansion of government," why doesn't he speak out about Dick Cheney, Liz Cheney, William Kristol, and the PNAC wanting to turn the United States of America into a GIGANTIC military empire that uses a GIGANTIC government run-military to bully, intimidate, and coherce the rest of the world into being subservient to the United States?

    Talk about a huge expansion of government...

    October 18, 2009 05:56 pm at 5:56 pm |
  6. K Long

    What Mr.Gregg fails to remember is that GWB started this FY term while he was in office. Also, if I recall, GWB signed into law a $750B bank bail out before Obama took office. He also was asleep at the wheel while the bankers and wall street went crazy plunging us into this situation. Glad he turned down the offer from Obama but what right does he now have to complain when he had the chance to be part of the fix? Politics is his game not truely fixing the problems and serving the people. Next.........

    October 18, 2009 05:57 pm at 5:57 pm |
  7. joe smith

    Too bad mr king didn't have the courage, or perhaps the knowledge to ask Mr. Gregg why the Freddie Mac report, ( a key financial report ), has NOT been presented to the President, and the American people. This report was to be completed for presantation by the end of May, 2009..does anyone care..

    October 18, 2009 05:59 pm at 5:59 pm |
  8. Canadian Soccer Mom

    First of all, do the Repblicans agree with any pick? Secondly, why do we only hear what the GOP has to say about things. It's hardly in their interest to say something positive and they've proven repeatedly that their sole purpose and strategy is to counter anything that this administration attempts. They never offer constructive input.

    October 18, 2009 05:59 pm at 5:59 pm |
  9. Kitty Parker, Charleston, SC

    This will not change as long as the population remains selfish (my needs are important, but those of others are wasteful) and Congress remains gutless and myopic ( I can't make the tough, but necessary decisions for the good of the country as long as it might risk my reelection chances with my political base). Our forefathers would be ashamed of all of us – they risked everything against the greatest power on earth at that time in order to establish this country. If we can't make equally great sacrifices for the good of the country, we don't deserve what we were given and we will lose it!

    October 18, 2009 05:59 pm at 5:59 pm |
  10. ran

    He never voiced a concern when Bush was running up the deficit and got rid of a surplus made by Clinton. Just another hate/fear/obstructionist Republican. Have the Republicans' ever heard of the "boy who called wolf"

    October 18, 2009 06:00 pm at 6:00 pm |
  11. victim of republican greed

    Gregg and the republicans are hoping that is the case. However like most sniveling wingnuts, he is a fear monger who will be proven completely wrong.

    October 18, 2009 06:04 pm at 6:04 pm |
  12. victim of republican greed

    That would be the direction that the foreign billionaire, who controls a lot of media markets in the US, would like to see the US take.

    October 18, 2009 06:07 pm at 6:07 pm |
  13. Andrew

    Gregg is an embarrassment to the citizens of New Hampshire he purports to represent. New Hampshirites have become steadily more progressive over the past years as evidenced by the bluing of the state which now a centrist Democratic governor, all Democratic representatives and a Democratic senator. NH is fiscally conservative and socially progressive and its people are generally appalled at the current far-right rhetoric with its hollow ideas and ignorant foundation. Gregg embarrassed his constituents with his deplorable snub of the Obama Administration's bipartisan outreach. There's a reason Gregg isn't running for re-election – he can't win here.

    Andrew from Bow, NH

    October 18, 2009 06:07 pm at 6:07 pm |
  14. Hope

    Give us a break, the republicans started this deficit, we will give Obama 8 years to fix this mess, it will start by stopping the tax cuts to the wealthy next year.

    October 18, 2009 06:07 pm at 6:07 pm |
  15. spokanebob

    You must be careful about criticizing the Obama administration or they will call you a racist. Are people not scared about the NAZI tactics taken by this administration to shut up its critics. They call peaceful protests the work of mobs, they call citizens expressing their concern racists, they try to blackmail bank officers and CEO's of major companys, they attack a news organization, they try to shut up free enterprise by threatening IRS audits of legitimate companies. Every day we lose a little bit more of our constitution and our freedoms. I am scared, very very scared.

    October 18, 2009 06:08 pm at 6:08 pm |
  16. victim of republican greed

    Fox lies is taking advantage of a lot of scared people, much like the carpet baggers did to the south after the Civil War.

    October 18, 2009 06:08 pm at 6:08 pm |
  17. hawk

    We blame it on people like you Gregg !!!!

    October 18, 2009 06:09 pm at 6:09 pm |
  18. NJ Patriot

    “Now you can’t blame that on [former President] George [W.] Bush,” Greg said.

    How pathetic to be trying to cover-up for the catastrophic Bush Administration.

    Of course you can blame Bush for a large part of the crisis–8 years of constant deregulation, Bush's coveted "ownership society" (which proved to be a cover for the sub-prime scam) and constant lying about how great the economy is going.

    This is Bush's Depression, and I'm the history books will not spare him. That's what we get for electing an incompetent, well-connected, lying tool.

    October 18, 2009 06:09 pm at 6:09 pm |
  19. Robert Buchinger

    It is very interesting that the GOP has suddenly become very wary of deficits after Obama won the election. The fact of the matter is that most of the federal debt (about 3/4) was incurred by 3 presidents, Reagan, Bush, & Bush. Some comments are even assigning the TARP funding ($1 Trillion) to Obama even though that spending was OKed under Bush. I just hope the GOP is returning to responsible funding rather than finding another avenue for partisan attacks.

    October 18, 2009 06:09 pm at 6:09 pm |
  20. Marty, Grand Rapids MI

    Typical. Says we are spending our way to oblivion, says you can't blame Bush but you can Blame Health care reform. Give me a break. Did he bother to read why we have such a huge Deficit? 2 wars (running on a credit card), One time stimulus, one time TARP and falling tax revenue. Oh, and the baby boomers are going to blow the crap out of Medicare and Social Security. He is right about the problem. Congress.

    Lets start a draft for our wars, start a war tax to pay for our wars and cut spending (Across the board, including military spending) and raise taxes. The problem is neither republicans or democrats want to do any of that.

    Oh, and until republicans submit a plan to the CBO, THEY DONT HAVE A PLAN.

    October 18, 2009 06:09 pm at 6:09 pm |
  21. Sniffit

    we libs can always, and i mean always blame bush
    the public be stupid

    blame bush, thats all we got

    October 18, 2009 06:11 pm at 6:11 pm |
  22. T Mckinley

    If the far-right (Dick Cheney, Liz Cheney, William Kristol, Project for a New American Century, etc.) had THEIR way, we would be spending TRILLIONS of taxpayer dollars turning the United States into a world-dominating MILITARY EMPIRE, and then spending TRILLIONS more bombing, invading and occupying every last country on earth who refuses to serve OUR interests of who "dares" to publicly oppose us.

    I wonder if Sen. Gregg is "concerned" about the cost of what the neo-cons would like to do with our money?

    October 18, 2009 06:12 pm at 6:12 pm |
  23. lou

    If you are a Muslim terrorist, like Bin Laden, you understand the only wayt to defeat the US is from the inside.

    Since he chose to use the Twin Towers, our symbol of financial supremacy to be his first targets, he has succeeded in one thing, bringing down the US financially.

    We are fighting two wars in Muslim territories while borrowing at a ferrocious pace from the very Arabs that want us dead. Who is leading this debacle? NObama. Put the pieces together America before its too late. We are being sold out from the top of our country, and we're allowing it to happen.

    October 18, 2009 06:13 pm at 6:13 pm |
  24. eolufemi

    Which is why we can't afford to win in Afghanistan, and have to cut spending on Medicare. We simply don't have the money for another 80 billion per year spent on that conflict.

    More importantly, Americans have to accept higher taxes in some shape, manner or form.

    Whether it be a new national sales tax, government revenue from cap and trade, and/or allowing the Bush tax cuts to expire.

    October 18, 2009 06:14 pm at 6:14 pm |
  25. gertie w

    Bush drove the nationa ldebt from 5.5 to over ten trillion during his tenure.Can't blame BusH/ certainly can

    October 18, 2009 06:14 pm at 6:14 pm |
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