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. Earl

    I think anyone that has common sense would have come to Senator Gregg's conclusion.

    Anyone without a basic concept of macro economics would see President Obama's plan as being reasonable.

    March 22, 2009 03:38 pm at 3:38 pm |
  2. Don

    America, you have been warned.

    March 22, 2009 03:39 pm at 3:39 pm |
  3. turfin

    Obama wants to build a 21st century economy where our children are dependant on liberal goverment handouts forever.

    March 22, 2009 03:41 pm at 3:41 pm |
  4. independent Jim

    I know that I am not the US government, but I think average people would pay off some debt to get their feet on the ground before buying a second house, investing in new cars, refrigerators, remodeling the kitchen, or putting in a pool. What the Presidebt proposes is exactly the opposite – let's have the government spend more money on credit, argue that it is a stiumlus, and "double hope with our fingers crossed pretty please" that revenues will go up fast enough to control the deficit. Now we hear that the WH's revenue projections are way off, but there is no talk about reductions in spending to go with it. Can you say inflation?

    March 22, 2009 03:43 pm at 3:43 pm |
  5. Josh

    I'm tired of the bashing, we need ideas people! Not blame! Blaming isn't helping. At this point it doesn't matter who started the fight, it's how to end it. If we're not careful we'll end up like the Middle east, fighting for thousands of years just because we can't resolve our differences. Is that what we really want? Offer solutions or shut up! Didn't someone once say, "If you don't have something nice to say, don't say anything at all?" I think there's a lesson here we're neglecting to pay attention to.

    March 22, 2009 03:43 pm at 3:43 pm |
  6. got to work

    How many of you people do your homework or try and find out the real things that are being covered up. Wouldn't it be nice to live in utopia, no more bills, no more worries? We could all just be happy and have everything taken care of us by the ruler. There would be any reward for doing a little bit more than your neighbor who is home watching HIll Street Blues while you're out busting your but to achieve something more. We would all become equal, no iniative to do something more. Hasen't this been tried before. Maybe you should read a little history. I believe Russia tried this, now it's the Soviet Union again. Are you aware of what they plan to do with medicine? I suppose you know that if you work you'll pay more to help out the people who chose not to work. I suppose that's the American way, we help one another. I'm all for helping the people that are trying to help themselves. But I'm not for paying for the pukes that are freeloading off of the system. Now it is going to get much worse if you work. Should we have big government take over the education system at a federal level. They were the ones behind the subprime lending by the way. They initiated it in 97. You want to know what is really sickening is that who supported it back then, our savour, Obama. I belive everyone got out of control, people were spending way beyound their means. Now we have to face up and pay the bill. The answer doesn't lie by more spending. As you can see, it's not working. Have you noticed or read that the congressing buget committee came out and said Friday that we cannot support this budget, this spending, hello. Wake up, if Russia can go bankrupt, why can't we? Just look at what has gone on just in the past week. I encourage you all to become more informed about what is going on.

    March 22, 2009 03:44 pm at 3:44 pm |
  7. Mike Syracuse, NY

    "The problem with socialism is that you eventually run out of other peoples' money"
    Margaret Thatcher

    March 22, 2009 03:44 pm at 3:44 pm |
  8. cyd

    Bankruptcy ain't all that bad!! Your system was going to one way or another. Improper spending on your huge military & reduced spending on health care & education for the last 20 years & huge debts...for those who complain about Obama;c'mon look at your history! You've made your own 3rd world America the great.

    March 22, 2009 03:45 pm at 3:45 pm |
  9. Glenn Nelson

    Praise the Lord that this idiot is NOT in the cabinet. At least we know that he is NOT running for relection, he said so again this morning. Be a good little boy and GO HOME

    March 22, 2009 03:46 pm at 3:46 pm |
  10. Expat American

    Comrade...not comrad.

    The human elements of stupidity and greed is why the nation finds itself dire straits.

    Greedy banks wanted to make money by giving bad loans to greedy people who wanted homes and material things that they could not afford; along with a lot of Big Macs and SUVs.

    In an economy and society based solely on capitalism, credit and cheap junk food; it's no wonder that simple greed and stupidity would bring forth its downfall.

    March 22, 2009 03:47 pm at 3:47 pm |
  11. What Americans FORGOT

    Is that "Rhetoric That Works For You" has produced a drugged population who invested their dreams in Obama who was a blank slate. And who WILL bankrupt the country. He had virtually no experience before, but was anointed The New Messiah by his handlers. Now, ANYONE who criticizes any aspect of his AGENDA (duh, 3 tax cheat nominees right at the very beginning of his term) has been branded as "unpatriotic" or "Republican wingnuts." AIG IS THE FALL GUY for Washington. Get the money back by TAXING THE POLITICIANS, and then perhaps they will take the responsibility they should have. Geithner, the tax cheat, should be the first one in line.....

    March 22, 2009 03:47 pm at 3:47 pm |
  12. Fred

    When the country goes bankrupt, can we get congress to give us a bailout?

    March 22, 2009 03:47 pm at 3:47 pm |
  13. So Much Bull

    Joanna March 22nd, 2009 11:05 am ET

    Do not put this crap on Obama. You people are responsible for this! We will not forget it. At least Obama is trying to get our country back where it belongs. You should have stopped bush!


    YOU GO Girl!!!! It's amazing that a person who is in office for what 60 days now is the reason why we are in the mess that were in. Obama never said he was a mircle worker, at least he is trying. If all of you want to blame somebody, blame congress and the senate. We need to get out the old (greezzrrrsss) and bring in new faces (young). Republicans 6years to there credit and Demrocats for 2years and with one arrogante presidents who didn't care what anybody said, it was his way or the highway. So, everybody who voted for this idiots are the ones to blame. One more thing, at lease Obama can answer questions from a town meeting without the people submitting there questions first.

    March 22, 2009 03:47 pm at 3:47 pm |
  14. Ted

    I never heard of Judd Gregg until his nomination to Obama's cabinet. So where was he when George W bush was spending $10 billion a month in Iraq? Probably he was no where with his head in the sand, not wanting to challenge the dictator Bush. The crisis just didn't happen since January 20. It has been going on for eight years.

    My request to Judd Gregg – if you have a better plan, then develop it and lay it out on prime time TV. If you don't, then shut up.

    March 22, 2009 03:48 pm at 3:48 pm |
  15. Al

    GOP is blind as usual, no clue, and torn between incompetent moderate crooks and raving religious extremists.

    March 22, 2009 03:49 pm at 3:49 pm |
  16. Cindy

    Fool... the country is already bankrupt. The foolish theory to let capitalism run unchecked created that. The Republican solution to do nothing, will do nothing to correct that, but it will give them the excuse that they didn't do anything to affect it, because... they did nothing. Nothing. The country, the world will continue to fail, because they'd do nothing.

    Obama is doing something. And he's doing it to help people. Why are the Rupublicans so dead set against helping people? I want help. My neighbors want help. If the government goes into debt to help me, so be it. At least they are helping me, and not themselves anymore. It's about time the government take some responsibility for the average people. Gregg just wants to save the government, and let the rest of us drown.

    March 22, 2009 03:50 pm at 3:50 pm |
  17. Glenn Nelson

    Does anyone remember Bushie telling us that the Iraqi's were going to pay for our services from their OIL money? What ever happened to that promise. I think that's worth about 750 Billion dollars-hello Republicans–

    March 22, 2009 03:51 pm at 3:51 pm |
  18. Ben B

    John King when are you going to stop drooling when talking about Obama? Don't think I have caught you saying the "OBAMA WHITEHOUSE", as much as, you always said the "BUSH WHITEHOUSE" was the blame.

    March 22, 2009 03:51 pm at 3:51 pm |
  19. David

    It was obvious 4 years ago when the US elected Bush after Abu Ghraib that the US was in possibly mortal danger. Rapture mentality had taken over many in individual financial crisis. It's ironic that Reagan, touted for the fall of the Soviet Union [who would have thought so precipitously?] is a major cause of our current fall.

    March 22, 2009 03:51 pm at 3:51 pm |
  20. Bertina

    If this Gregg guy knows so much, why did he back out of the job. Besides, who had the majority in congress before 2006. The Republicans are now blaming the democrats for the mess that they (the Republicans) made. Talk about 2 faced...of course, they never were very good at taking responsibility for their own actions. With Cheney, Delay, Rove, Limbaugh, Coulter etc. on their side, I don't know why we are in such a mess????????

    March 22, 2009 03:53 pm at 3:53 pm |
  21. Anon.

    Commodity Futures Modernization Act of 2000 signed by President Clinton on December 21, 2000. Congress was pushing for the deregulation of banking institutions. At the same time Congress was pressuring banking institutes to grant credit to those who normally wouldn't qualify. Put the two together and you have banking institutions making risky (toxic) investments (I.e., hybrid sub-prime mortgages) in order to comply with Congress with no regulations to restrict how they did so. Our economic downfall is the fault of both parties that was put into motion prior to Bush's or Obama's administration. Why didn't we see it coming? Simple the economy start booming. Now there were more individuals qualifying for mortgages/loans, skyrocketing the value of our homes. Life was good. Until those individuals could no longer make payments on those loans, bringing about foreclosure, banks losing millions, etc.

    I agree with the approach many European countries are taking. Start enforcing regulations on banking institutions and stop forcing institutions to grant high risk loans to those who normally wouldn't qualify. Stop bailing out every Tom, Dick and Harry who forgot to read or failed to understand the terms of the loans they agreed to.

    March 22, 2009 03:53 pm at 3:53 pm |
  22. Leslie

    In Japan, when corporation are failing, their CEO commits suicide; in USA they're given bonuses. In Japan when politicians are caught lying, breaking their promises; they go on TV, bow their heads and ask forgiveness from their constituents and resigned; in USA lying politicians are voted back in office, forgiven like nothing happened. They keep on lying, they keep on breaking every laws in our constitution; their followers either left or right point the blame to previous administration or whoever they feel can give them a mileage for a day. Then the people woke up from their beautiful dream; they have nothing left, politicians took away everything from them, they all become victim of their own stupidity and party loyalty. Who is the winners and losers? Winners are the politicians, losers are the American people regardless of political affiliation. Everyone go down with the ship while politicians are in the lifeboat wearing a life jacket. NEVER forget, a government that will give you anything, will take EVERYTHING away from you.

    March 22, 2009 03:53 pm at 3:53 pm |
  23. canadian soccer mom

    If Mr. Gregg feels this way, why would he not pitch in to help? So far all he has done is say what is wrong and not give solutions. So what if he didn't like the direction the president was going. He still would have some input. I believe his reasons were strictly for political gain in his party.

    March 22, 2009 03:53 pm at 3:53 pm |
  24. danny

    why does no one ever mention the illuminati , the true front men running the world through puppets such as bush and obama .... untill the federal reserve is cruched and the rockefeller,and rothschilds of the world (with the new world order plans) are crushed , their planned depression will continue , everyone realy should do their homework , this is all planned and obama has no say , he is just a puppet !!!!

    March 22, 2009 03:55 pm at 3:55 pm |
  25. Ernestine

    instead of all you people mocking the president for what he is trying to do. For all you experts on this blog, submitt your solutions to him, he has websites out there. At least he paying attention.

    March 22, 2009 03:55 pm at 3:55 pm |
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