October 18th, 2009
03:08 PM ET
13 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. ib

    You know that Obama is spending all this money that we don't have to clean up the mess Bush left him according to King Obama. I want to know who is going to clean up the bigger by far bigger mess Obama is making if we still have a country left when Obama is defeated in 2012?????

    October 18, 2009 06:53 pm at 6:53 pm |
  2. Simmy

    Shut up, you crazy fool!!!!

    aka Mr. "T"

    October 18, 2009 06:56 pm at 6:56 pm |
  3. Tom Palm

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

    Gregg must be referring to the "standard of living" of those in Congress and on K Street. The rest of us have watched our ability to remain financially solvent go down hill for sometime.

    October 18, 2009 07:00 pm at 7:00 pm |
  4. "disgusted NH resident" Martin LeBeau

    Your readers may know why Senator Judd Greg (R-NH) has his knickers in such a twist now and will resign this next election. Could it be that he has a hard time accepting the fact that four of the five top leaders in this state are Democrats, i.e. the Governor, the other Senator and both Congressmen? Times have really changed.

    October 18, 2009 07:01 pm at 7:01 pm |
  5. Keith A Sillsbury

    How Stupid are you greg? Under H.W. Bush the nation went into a large defict that it took Clinton to get us out of and when he left office he had us in the positive with a surplus to last the decade. Then came jr. war, war, war. spend, spend, spend, and not on the American People. He gave Billions to our enemies or anyone that for the moment would help him. Now We have a president that is thinking of US and our future and everyone knows that it's going to cost trillions in the short run and in five or eight years we can start to think about reversing the flow and getting back to a surplus flow. Everyone but you and the rejects in the GOstoPo. If your car can't get you to work, don't you need to spend money on it to get it fixed so it can get you to work to make the money to pay for the repairs? stop being an idiot.

    October 18, 2009 07:03 pm at 7:03 pm |
  6. Martin LeBeau-NH resident

    Your readers may know why Senator Judd Greg (R-NH) is upset enough to resign his Senatorship next election. Four of the five top leaders in this state are Democrats, i.e. the Governor, the other Senator and both Congressmen.

    October 18, 2009 07:08 pm at 7:08 pm |
  7. Dan A

    About time for you to retire Judd–you never had much of a contribution on Capital Hill anyway so go back to your "" questionable business deals " in New Hampshire !!!!!

    October 18, 2009 07:10 pm at 7:10 pm |
  8. Connie, Indiana

    Now what previous president does this sound like. Bush let the economy crash, tax breaks for the richy rich, put us in 2 wars,didn't put the cost of the war in the budget, spent a surplus intoa deficit, secret medicare prescription bills, shall I go on. And now these republicans who sat idlely by and watch the US crumble, now are screaming at the top of their lungs..My guess they should have been screaming yrs and yrs ago when all this stuff started, but nope, must be quiet, at least we have a tax break that is good for us.. fools, and now they complain. What are they afraid of, maybe the middle class making some headway in this world.

    October 18, 2009 07:11 pm at 7:11 pm |
  9. Reagan was wrong

    "This deficit is driven by us"

    If by "us" he means the GOP during the Bush years, then I agree 100%. Ramming tax cuts via reconciliation, engaging in illegal wars to funnel billions to Halliburton, etc. via no-bid contracts, not factoring in the cost of the war into the budget, and neglecting countless social services and infrastructure projects at home completely depleted the nation's coffers, which were overflowing when Bill Clinton left office.

    October 18, 2009 07:15 pm at 7:15 pm |
  10. Connie, Indiana

    they have used every adjective to discribe this administration, now it is a "banana republic". What adjectives would he have used for the previous admin? I would have used "dictatoral admin" how is that!

    October 18, 2009 07:15 pm at 7:15 pm |
  11. Ryan indy

    Liberals and Democrats will continue everything on Bush because they are to ignorant and hateful to see the truth that this president is a spending idiot...... I would take GW over this clown that is now in the white house any day of the week....

    October 18, 2009 07:18 pm at 7:18 pm |
  12. Gary in VA

    I would like to know where all these budget concerns for our children was when we went to war with Iraq. Lord know we didn't have to go to war. No one had invaded us. THe people who did 911 weren't from Iraq. They new this before one bomb was drop or one bullet was fired. If we are to go into debt. I don't mind spending it here at home in the great US of A on citizen. BIG EXAMPLE HEALTH CARE.

    October 18, 2009 07:19 pm at 7:19 pm |
  13. Debbie

    Hmmm if Gregg really felt this way then why was he a) not vocal about it to G.W.Bush, 2) Why not accept Obama's offer and fight to have a bigger imact on policy decisions, 3) the gov taking on that about of debt was not an issue during the Clinton years. Ask GW where the all the money went? Oh yeah it went towards a war where there were no weapons of mass destruction...just the bloodshed of our children.

    October 18, 2009 07:21 pm at 7:21 pm |
  14. Nea

    Yes go ahead blame the current administration for the debt as if the past administration had nothing to do with it. Yes we are spending money but its what do we have to show for it is the question. The last administration spent alot of money but yet the Republicans have gotten amnesia but YES! blame President Obama it dont matter whats done is done and somebody have to own up to responsibilty. BUT THINK ABOUT THIS AMERICA IT COULD HAVE BEEN WORST SO BE THANKFUL AND BE PRAYFUL AS WELL!

    October 18, 2009 07:22 pm at 7:22 pm |
  15. ephraim

    utterly stupid!

    the only way a republican couldn't blame bush for the massive debt is if obama started in the black with a balanced budget, and a solid economic spreadsheet. we have had 8 years of unchecked war, and a banking a regulatory mess of biblical proportions left by bush and cheney.

    100% of obamas time in office has been cleaning up bush's planetary scaled mess or starting what should have been done 8 years ago. sadly the u.s. is not a position of doing all the hard stuff one at a time, we need to confront all the problems longitudinally and systemically. we must carry some debt to restart the economy and then retool the u.s. industry to compete in the future... one way to help is to overhaul health care which is a huge cost, transform education, etc...

    October 18, 2009 07:25 pm at 7:25 pm |
  16. joel palmer

    Where were all the "fiscal experts" like Gregg duringt he 2000-2008 "dark ages" when GWB spent this country into a "black hole?

    October 18, 2009 07:26 pm at 7:26 pm |
  17. demo no mas

    I don't think the man is too far wrong. He isn't running again and politcally won't be harmed by speaking the truth. I can't lay this on Obama alone. Our Congress is bringing us down.

    October 18, 2009 07:27 pm at 7:27 pm |
  18. joel palmer

    Gregg carfeully avoids the fact that most of the deficits to date have been a direct result of:
    1. Bush tax cuts for the rich
    2. Unfunded wars
    3. Unfunded pharma benefits
    4. Bush fiscal recklessness
    5. Trickle Down economics

    October 18, 2009 07:29 pm at 7:29 pm |
  19. annie s

    You can't blame Bush??? Well, hell, I can. At least President Obama is spending money on programs to help people. I have a great idea on how to cut the deficit – get rid of the Bush tax cuts to the rich and end his war in Iraq.

    October 18, 2009 07:29 pm at 7:29 pm |
  20. Ez

    Gregg is a fumbling idiot. So his comments are null and void. He couldn't find his behind if you drew a line to it.

    October 18, 2009 07:32 pm at 7:32 pm |
  21. Chris

    When will ALL members of Congress realize that the money they want to spend belongs to those who've earned it? Quit stealing the working man's money in order to appease the Socialists in this country. It's nothing more than a corrupt government would do in another country.

    October 18, 2009 07:37 pm at 7:37 pm |
  22. B

    He must realize that the huge amount of money now being spent to Save the Economy and the BANKS was a must do !

    After the Bush administration just about destroyed the whole thing.
    Obama was handed a huge disaster which he is making progress
    doing, no thanks to people like Gregg !

    October 18, 2009 07:40 pm at 7:40 pm |

    DUH, anyone with common sense can see that we are on the path of financial self destruction and Obama G20 initiative will rely on the world bank to bail us out. I hope that the next administration holds the entire Obama regime as traitors to the american people for destroying the country and for initiating policies that systematically threaten america's abilty to defend ourself and our sovernty. Our country is being taken down on purpose and this malicious financial irresponsibility is premeditated treason

    October 18, 2009 07:44 pm at 7:44 pm |
  24. iamericanperson

    Creating national deficits seems more a Republican tendency since I started voting in 1980. At least improving our nation's health is a morally valid venture and honorable political ambition. Perhaps the Nordic folk understand courageous political vision (e.g. Nobel Peace Prize) better than us.

    October 18, 2009 07:56 pm at 7:56 pm |
  25. Michael

    What a suprise. Along comes one more of the losers who caused the collapse of the American finacial system claiming "you can't blame that on bush." NONSENSE !

    Neoliberal economic policies dating back to Reagan and continued by the Bush family and their allies in congress caused the financial meltdown (Bush called for the first "bailout" on his way out the door) and Bush's ill conceived, unnecessary war in Iraq are major drivers of the current government debt.

    It is not possible to bail out the banks and insurance companies and start two wars without raising taxes.

    The American public needs to wake up and understand that this is what the world looks like when you allow republicans to spend spend spend on wars while refusing to raise taxes.

    October 18, 2009 08:07 pm at 8:07 pm |
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