March 22nd, 2009
03:41 PM ET
11 years ago

Gregg: 'This country will go bankrupt'

[cnn-photo-caption image= caption="GOP Sen. Judd Gregg warned Sunday that the country might be headed for a fiscal crash if spending isn't controlled."]
WASHINGTON (CNN) – Even though he was almost a member of the new Obama administration, New Hampshire Republican Judd Gregg Sunday slammed President Obama’s approach to handling the country’s fiscal outlook.

Watch: Gregg warns of fiscal 'crash'

“The practical implications of this is bankruptcy for the United States,” Gregg said of the Obama’s administration’s recently released budget blueprint. “There’s no other way around it. If we maintain the proposals that are in this budget over the ten-year period that this budget covers, this country will go bankrupt. People will not buy our debt, our dollar will become devalued. It is a very severe situation.”

Gregg, known as one of the keenest fiscal minds on Capitol Hill, also told CNN Chief National Correspondent John King that he thought it was “almost unconscionable” for the White House to continue with its planned course on fiscal matters with unprecedented actual and projected budget deficits in the coming years.

“It is as if you were flying an airplane and the gas light came on and it said ‘you 15 minutes of gas left’ and the pilot said ‘we’re not going to worry about that, we’re going to fly for another two hours.’ Well, the plane crashes and our country will crash and we’ll pass on to our kids a country that’s not affordable.”

Despite his criticism of Obama’s approach to the long-term finances of the country, Gregg praised how Obama’s top economic lieutenants are trying to get the sick banking system back to health.

“They’re doing the right things,” Gregg said about embattled Treasury Secretary Timothy Geithner and White House economic adviser Larry Summers. “They haven’t done it as definitely as they should have . . . but they are moving in the right direction and the Fed is moving in the right direction,” Gregg said on CNN’s State of the Union.

Gregg broke ranks with some of his fellow Republicans and said he did not think Geithner should step down from his Cabinet post.

On the recent scandal of more than $150 million in bonuses paid to the AIG employees whose work pushed the financial giant to the brink of collapse, Gregg criticized the plan afoot on Capitol Hill to tax those bonuses at very high rates. But, Gregg pointed out that the Obama administration and, to some extent, the Bush administration before it failed to “discipline” the bonuses paid out by AIG, which is now 80 percent owned by the federal government.

The Republican senator was appointed to be Obama’s Commerce Secretary but then bowed out unexpectedly, citing policy differences with the Democratic administration.

soundoff (494 Responses)
  1. Kentucky Actuary

    If we split the country in two, republicans in the red states and democrats in the blue, the blue states would look like Cuba in five years while the red states would prosper beyond imagination.

    March 22, 2009 02:38 pm at 2:38 pm |
  2. BC

    Just for the record the national debt went thru the roof from 1980 to 1988 during the Reagan trickle-down economics era. They had this great idea that if they cut taxes on everybody, especially the rich, that the economy woul grow. It did – but surprise surprise – less taxes means less revenue. which means a skyrocketing national debt. Was it worth it? Ten years of prosperity and excess in exchange for trillions and trillions of debt? Bush Jr. must have thought so because he tried the exact same thing. And our economy grew as our debt skyrocketed again. All of our prosperous times have been false and were being propped up by borrowed money. At some point you HAVE to pay off your debt and get back to fiscal responsibility. But that's a tough sell to an electorate that wants everything all the time.

    March 22, 2009 02:39 pm at 2:39 pm |
  3. Mike in Kansas

    Larry March 22nd, 2009 12:11 pm ET

    Just another Republican flapping his jaw to show he's with his team in bashing everything Obama does

    Yawn … wake me up when a Republican says something useful

    Larry, you will never have to wake up if thats what you are waiting for. The Republicans hate America and what she stands for. Isnt that obvious? Just look at the looks on their front men's faces Joe Scarbourgh, Pat Buchannon, Newt Gingrich, did you ever see such contemptable sneers? They look as if they can't stand the smell of the country, when what they are smelling is their top lip. I wonder how Jerry Falwell and Lucifer are getting along?

    March 22, 2009 02:39 pm at 2:39 pm |
  4. Linda, NY

    What a joke this guy is–our economy has already crashed but as a member of the inner circle in D.C. he has not felt any of the pain.

    John King really should find a spot on Fox or Rush's show and stop bringing these greedy, fear-mongers into our homes on Sunday. CNN–you drop Hughley but keep on this neo-con?

    March 22, 2009 02:40 pm at 2:40 pm |
  5. Moe NY

    Just more fear mongering by the Republicans. The Republican party does not have any answers, all they can do is try to instill fear into the American people.

    March 22, 2009 02:41 pm at 2:41 pm |
  6. J. Hayes

    Republicans are an absolute JOKE. They just HATE the fact that a african american man has taken what they thought God had ordained for white men only. Funny how people want to emphasize the fact that Obama's half white, when any other time if you had a drop of black blood, you were considered BLACK or an OTHER).

    March 22, 2009 02:42 pm at 2:42 pm |
  7. Little Hawk

    If Judd Gregg was so concerned about this country and believed that our financial house is in such dire straits as he proclaimed in this article then he should have accepted Obama's cabinet nomination and not put partisan politics ahead of his duty to our country.

    March 22, 2009 02:42 pm at 2:42 pm |
  8. Edward

    Republicans only support spending ourselves into oblivion when it comes to wars and nation building. The moment you suggest spending money at home in the US they get upset that you're spending too much. I don't remember any of them opposing the war that we were lied into and the then president's decision to spend tons of money to build and Iraq democracy.

    March 22, 2009 02:43 pm at 2:43 pm |
  9. Chuck

    Where were these guys during the Bush years when they controlled both houses of congress for six years and spent more money than ever imaginable, without a single spending veto. While there is plenty of blame to go around they are primarilly responsible for putting this country near depression.

    March 22, 2009 02:46 pm at 2:46 pm |
  10. Out of work

    Gregg's transparent effort to blame Obama for the economic disaster inherited from Bush, is insulting. He should either help with productive ideas consistent with the platform on which Obama was elected or just shut up. Blaming Obama for the economy is like blaming the fire department for the fire they are trying to put out. Because of his lies, Gregg has disgraced himself and his office and should resign.

    March 22, 2009 02:48 pm at 2:48 pm |
  11. Realistic Democrat

    Politics aside, he is right. China already said they are concerned about future US debt quality. True, the deficit was high (in $) when Bush left office. But as a percentage of GDP, it was pretty tame in historical standards. With the latest bailout stimulus for unions and all the projected Obama social plans, the debt level compared to GDP will only increase significantly. Bush is not to blame for Obama's spending plans. In order to implement all the programs that Obama's budget plan includes, the only option will be to return to income tax rates of 50% or higher for everyone.

    March 22, 2009 02:49 pm at 2:49 pm |
  12. Mike From California

    Hey John-from-California. The Democrats have been running California into the ground, now they're doing it to the whole country. Exactly how does California, where 1% of the people pay 50% of all income taxes, operate better than trickle down? They just raised the top income rate to almost 11%, sales tax "temporarily" to 10.25% and cut the hell out of services to "balance the budget" Less than 30 days later we're already another $8 BILLION underwater. Compare that to when Reagan ran the state. Even our own legislators are claiming Maryland residency to avoid this tax commie state. Toyota moved it's new Prius plant to Mississippi because it sucks here, and now AAA is moving too. The more you try to tax your way out, the less tax revenue there is. You want fair?? Pay your fair share of taxes.

    March 22, 2009 02:49 pm at 2:49 pm |
  13. Pam

    After reading several comments..Would someone Please explain to me the path we should be taking to put America on solid ground!

    March 22, 2009 02:50 pm at 2:50 pm |
  14. albo58

    Boy, CNN sure attracts a lot of mindless sheep to defend the inept president that we unfortunately have now! To say all the initiatives over the last 6 weeks were meant to stimulate our economy is pure hogwash! The political paybacks to cancers like the unions, the Global Warming fruitcakes, the pro-illegal immigrants lobby, and the "let's apologize and prostrate ourselves to all the other countries of the world so they'll start to like us again" crowd has really been Obama's goals and achievements. He and his socialist admirers in the Congress are pathetic and need to be chunked out of office like yesterday! God save the U.S.A.!

    March 22, 2009 02:51 pm at 2:51 pm |
  15. RSB - St George, UT

    Let's see. Bush inherited a surplus, but squandered it and spent the country more into debt than any other president in US history, started 2 unconstitutional wars to stimulate his on approval ratings (as opposed to provide for the defense of the country), and opposed regulation to keep big Wall Street banks and financial institutions in line. As a lame duck, he set a precedent by allowing the first 750 Billion dollar bailout bill to be pushed through with no checks/balances in it. The list goes on. What do you think McCain would be doing about things now? Not much. So far, all he's done is criticize, but he hasn't offered one alternative constructive solution. I haven't heard any republicans come up with any good ideas, just criticism.

    March 22, 2009 02:51 pm at 2:51 pm |
  16. yasmine

    Gregg and John King make me sick right now.. John King must make more than $250,000 a year and just don't want to see his tax % go up.. Gregg is in that group too,...

    Gregg has no credibility...he is just a puppet!1

    all they do is whine.. where are the alternatives... why aren't you giving alternatives.. they sound like parrots...

    March 22, 2009 02:51 pm at 2:51 pm |
  17. Tom

    Gregg is way off base, as is almost the entire GOP. It is quite clear that you have to spend in order to create jobs, get banks moving again, and take care of the crumbling infrastructure in this country that must be fixed in order for us to be competitive in the 21 century, not to mention live a decent quality of life.

    The question is: Where do you spend? Do you blow it on a misguided war in Iraq and tax cuts for rich people in hopes that they let a little bit trickle down to the rest of us? (We know what really tends to "trickle down," and it ain't the sweet honey.) That's been tried, and it failed miserably.

    The alternative is to spend on the right things and do it in a large enough amount that it will work. That is what Obama is trying to do. He is working to clean up the Bush train wreck and move us forward into a sustainable position of genuine leadership in the modern world. If only he'd been in charge for the last 8 years (or Gore, or Kerry), we'd be in a lot better position today.

    March 22, 2009 02:52 pm at 2:52 pm |
  18. dave

    Message to Gregg we have already financially crashed. If he doesn’t believe it Come to my neighborhood in California and see all the foreclosed homes.

    March 22, 2009 02:52 pm at 2:52 pm |
  19. Independent Senior

    Why is it that the PIGS at the trough, who created the instruments that brought us to this crisis, think we should have any respect for their old
    schemes to save the economy.

    The right-wing, greed-mongers have sucked the blood from us and now hopes to get what they missed. LUSH LIMBO stokes the fires of hatred and stood his ground, along with his miniscule flock of sheep to criticize, from day one, the efforts of President Obama, instead of being part of the solution, he continues to be part of the problem.

    Now DUDD want to press his agenda and not our nation's. He spews
    the same 'chum' that got us into this mess under his disgraced leader

    Is this country going to fall for this pablum again or will it give our new
    President a chance to get us back to the country it was, when not under the thumb of the Republicans.

    WE are going to make a greater effort to remove you and your ilk from office in 2010, so we at least have a chance.

    March 22, 2009 02:53 pm at 2:53 pm |
  20. Belle1

    Too funny, you say the country is already bankrupt, so spend more?

    Bush, over 8 years, left a deficit of 11 Trillion dollars, which included a recession, 9/11 and two wars.

    Obama, just with his budget will leave 23 Trillion dollars over the next 10 years. We are not adding in the "stimulus" the "throw us all under the bus Omnibus bill" nor adding in the 1 Trillion dollars sent into the economy Friday afternoon. The government is printing it on loan to itself. So, that means you take 1 Trillion from your left pocket and write an I owe me in place of it.

    At no time in history of the World, has this type of spending worked to recover an economy. Zimbobwye (sp) tried it, and their country's economy failed...

    I thought President Obama hired the brightest? Gold went up 75.00 in 18 hours after Obama announced the printing of 1 Trillion.

    March 22, 2009 02:53 pm at 2:53 pm |
  21. Nathan

    Quit Pointing Fingers.. Spend Less.. Tax the balance.. It will be hard for a while.. but ultimately we will survive.. and we will be stronger in the long run. The people want corrupt systems to fail. We don't want less government, we don't want democratic party government, and we don't want republican party government. We the People want American Government.

    March 22, 2009 02:54 pm at 2:54 pm |
  22. Tony from Ocala Fl.

    Mr. Gregg, sure glad you are not a cabinet member..Question, where have you been, big mouth, for the last 8 years. Keep your dumb opinions to yourself, media monger.

    March 22, 2009 02:54 pm at 2:54 pm |
  23. Deb

    Ok now, to the republicans, do you have a solution to this problem? All I have heard was griping and no solutions from the republican side. Don't you think it is time to swallow your pride, and that means democrats too, and work together for the good of the people of these United States. I really do think it is about time for this to happen. If not, yes we are all in a world of hurt, dems, repub., and indep.

    March 22, 2009 02:54 pm at 2:54 pm |
  24. Katrina

    Didnt Warren Buffett say the same thing about 2 weeks ago? Buffett said that Obama needs to concentrate on fixing the economy and then move on to other things such health care etc... Only 8% of the stimulus package is going to support infrastructure so how many jobs will we create really.... Only time will tell, but I dont know how you can tax and spend this country out of this mess and currently that is the only thing that Obama is doing... Obama is no different from George Bush.

    March 22, 2009 02:54 pm at 2:54 pm |
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