After Debt Fight, States Crave Stability
MICHEL MARTIN, host: I'm Michel Martin, and this is TELL ME MORE from NPR News.
Coming up in our weekly parenting conversation, it's the latest in our series on chronic health conditions that affect kids. Today, we're going to tackle diabetes, which is a growing problem for kids and adults in the U.S. We'll talk about what it is, and how to help kids manage it so that they don't just survive, but thrive. That's coming up a bit later in the program.
But first, the Senate has now passed the bill to raise the debt limit and cut spending, in a 74-to-26 vote. Here's Senate Majority Leader Harry Reid, after the vote.
Senate Majority Leader HARRY REID: We need to do more for families. The number one job we have, as a Congress, must be creating jobs for the American people. Today, we made sure that America will pay its bills. Now it's time to make sure that all Americans can pay theirs.
MARTIN: The House of Representatives had already adopted the plan last night. The bill's passage ends the danger of a default on the nation's debt - which would have been the first time in this country's history that the government could not honor its obligations.
In the past few days and weeks, we have been getting perspective from some of the key players in the political fight over raising the debt ceiling - a fight that was led, in large part, by a group of conservative Republicans who vowed to oppose raising the debt limit without comparable spending cuts.
But today we wanted to turn to some other key players in this conversation - the states. The national battle over default could have put credit ratings for some states at risk, too. Moody's Investor Service named South Carolina as one of five states whose credit ratings could have dropped in the event of a default on the debt. But the compromise deal also includes changes that could threaten economic health there, too. That might not be good news in a state that according to the U.S. Center for Labor Statistics, is experiencing an unemployment rate of 10.5 percent, which is higher than the national average.
In a few minutes, we'll hear from the mayor of Columbia, South Carolina, Steve Benjamin; and South Carolina state treasurer Curtis Loftis. But first, we want to bring you our conversation with U.S. Representative James Clyburn. He represents the 6th District of South Carolina. He is the assistant Democratic leader in the House. He was also the only representative from his state to vote for the debt deal, and he joined us earlier from his office in Washington, D.C. Mr. Clyburn, thank you so much for joining us once again.
Representative JAMES CLYBURN: Well, thank you so much for having me.
MARTIN: Before we talk about the debt plan, I wanted to ask you about a - kind of an emotional moment in the House last night, where congresswoman Gabrielle Giffords of Arizona returned to the floor to vote for the first time since she was severely wounded by a gunman in her district, in January. I just wondered what was the atmosphere like when she made her appearance on the floor. And do you think that that made a difference in the vote?
CLYBURN: Oh, no, no, no. It did not make a difference in the vote at all but it was a very, very emotional moment. I think there may have been about four or five minutes left on the time. You know, it was a 50-minute vote. And so it was deep into the vote, and it was pretty much determined the outcome when she showed up on the floor.
But I think it was so emotional because most, if not all, of the members - especially on the outside - have had real close relationships with Gabby. And we're just really - had been hoping and praying that she would be able to come back. And to have her come back in such a dramatic fashion during probably the most important vote that will be cast in this session, it was just beyond belief. It was just absolutely incredible.
MARTIN: Well, thanks for that. Now, of course, we want to talk about the bill. The Democrats in the House voted - were split right down the middle over the bill. Many members of the Congressional Black Caucus voted against it. The chair, Emanuel Cleaver, voted no, calling the plan a sugar-coated Satan sandwich - which is pretty harsh words. You voted for it.
CLYBURN: Yes, I did.
MARTIN: Why did you vote for it?
CLYBURN: A number of reasons. First of all, I usually study these things pretty closely. And everything that - almost everything that we thought we wanted as a caucus was in the first two years: Having the firewalls between defense and non-defense spending, an uptick of $44 billion in the first two years, above where the current expenditures are.
So if you look at that, then your question will say, well, how about the next eight years? Well, the next eight years, we have to keep in mind, no Congress can bind future Congresses. And so if you get what you really, really want in your term, in your session - this is the 112th Congress - then you have to believe that the elections next November will define the level of commitment that will remain for the other eight years.
So if we were to lose the election next November, then I suspect this thing is going to be revisited in a negative way. If we were to win, then we can revisit it in a positive way. So when you look at all of the calculations, I don't really get my nose all out of joint for 10-year programs when I know nothing that can be done in these two years can be binding upon anybody in future years.
So the things that I wanted to see protected - Social Security, Medicare, Medicaid, the student loans - these things came out in very good shape in the first two years, and then in much better shape than we would be without this bill.
MARTIN: And as we mentioned earlier, well, you're both a local leader and a national leader. You're a member of the House leadership. But I wanted you to kind of tilt your South Carolina hat a little more heavily now, and ask why you're the only member of the South Carolina delegation that voted for the bill. You're also the only Democrat in the delegation. But why do you think that is?
CLYBURN: Well, you know, I'm not sure, except there's only one explanation for it that I can fathom, and that is this pledge thing that people signed. You know, the Club for Growth came out against this thing. I understand that the Tea Party groups wereagainst it - though my calculation indicated that if you look at the Tea Party caucus, I think more of them voted for it than voted against it, by about two or three.
So I believe that it was a pretty good deal, especially for South Carolina. So for us to default, it might have dire consequences for those of us here, with the federal budget. But for South Carolina, it would've been almost an immediate downgrade in its authority to borrow money. And we need schools to be built in South Carolina. And they've got to be built with bonds.
We have an infrastructure bank in South Carolina. And you fund these infrastructure banks with borrowed money. And you need the best deal that you can get when you're trying to borrow money to build roads and bridges, to build schools, and to do other infrastructure stuff.
And so there's no real good policy reason to have voted against this. So it had to be a political calculation. And that's why I don't sign pledges. I've had some very good people who I vote with, you know, 100 percent of the time. They've sent me a pledge. In fact, a couple of weeks ago, they came to my office, I understand, wanting me to sign a pledge that I would protect Medicare. I'm not signing anybody's pledge because your interpretation of protect may be different from mine. So signing these pledges - and I've had some bad experiences. And so I don't blame these people for doing it when you're trying to get elected for the first time. But I would say to them, please don't do that again, because that doesn't make any sense going forward.
MARTIN: That's Representative James Clyburn. He represents the 6th District of South Carolina. He's also the assistant Democratic leader. And he was kind enough to join us from his office in Washington, D.C. Mr. Clyburn, thank you so much for joining us.
CLYBURN: Well, thank you so much for having me.
MARTIN: If you're just joining us, I'm Michel Martin, and this is TELL ME MORE from NPR News.
We're going to turn now to the question of how this bill might affect states and cities. We're focusing particularly on South Carolina. We were just speaking with South Carolina congressman James Clyburn about the debt-ceiling bill that passed through the House last night.
But we're focusing now on how a default could potentially affect South Carolina or the ramifications of the bill. We're speaking with the mayor of Columbia, South Carolina, Steve Benjamin; and the state treasurer of South Carolina, Curtis Loftis. Gentlemen, thank you both so much for joining us.
CLYBURN: Thank you.
CURTIS LOFTIS: Thank you very much for having us.
MARTIN: Mr. Treasurer, I wanted to start with you. As we mentioned earlier, Mr. Clyburn was the only member of the South Carolina delegation to vote for the bill. He's the only Democrat in the delegation, which may have played some role in it. But I wanted to ask how you, you know, assess this bill coming down the pike for the - and how it would affect your state.
On the one hand, you know, a default would certainly have affected your state. I mean, it's one of five states whose credit rating might have been downgraded as a result of the heavy impact of federal spending in the state. On the other hand, there are cuts in defense spending that are possibly anticipated.
So I just wanted to ask, you know, how were you assessing this from your standpoint as state treasurer? Would you have wanted members of your delegation to support it? Did you think it was a good deal?
LOFTIS: I looked at this as grand theater. You know, this was a great opera, Wagnerian in experience. And I'm not sure what it actually accomplished. One reason we were one of those five states that was triggered for a downgrade was because we're a top-tier state. You know, if you're already have poor credit, it's not a big deal.
And the reason we were put on that five-state list is because we have a large federal entwinement with our expenses and our revenue. You know, we have a large Medicaid population. We have a lot of military bases and military contracting. So it is serious, and it is important. The point that I was trying to make was how this has all come about as - it illustrates the fact that we spend too much money as a country and as a state. And the way we handle our budgets is not appropriate anymore.
You know, many of the issues discussed here about cutting budgets - that's a budgetary issue. It shouldn't be a deficit issue. We should address the deficits at the time we create these budgets. So we've got this grand opera; everybody's concerned about it. It affects the markets; it affects business. The primary outcome of all this is uncertainty. And that kills business.
MARTIN: So, OK. Well, let's turn to Mayor Benjamin now. Mayor Benjamin, what's your perspective on this? How do you - what do you understand about the impact of the current compromise in South Carolina?
STEVE BENJAMIN: Well, I think we're all trying to get to the bottom of exactly what the resolution is. I've read the talking points from the White House, from a bipartisan group, from many people who quite frankly, were less interested in the details but more so interested in removing this air of uncertainty from the table.
The capital markets don't like uncertainty, and it's certainly - Treasurer Loftis and the treasurers before him have been good stewards of our state's credit rating for many years. And that's something that we hold very closely here. Our city recently had our credit rating increase by Standard & Poor's and Moody's. We're running a very tight ship here locally. So it's important to us to make sure that the few programs that we do rely on, support from the federal government - and the way that we approach it, Michel, is when we approach the government about partnering on one thing or another or pursuing a particular grant opportunity, those requests are focused around our priorities.
Our priorities reflect our values. We focus intently on public safety, on job creation, on the environment and sustainability, and most of our support comes from those pockets. So when you look at the possibility of long-term cuts to certain programs, defense being probably primary amongst them - we are the home to Fort Jackson, the Army's flagship training institution right here in Columbia - it's important to us how this deal gets worked out long term.
But the immediate concerns, this air of uncertainty about whether or not the United States is going to fulfill its obligations, it's something that left us greatly troubled. The way it would impact our state and our local governments' borrowing ability, and increasing the cost of debt to our citizens, bothered us. But an even keener eye - looking at our ability to continue to put officers on the streets through the COPS program, continuing to have the 30,000 students at USC and the six other colleges here in town to rely on Pell Grants, and a significant number of retirees who do rely heavily on Social Security and Medicare. And these are major issues for us.
So I will tell you that the primary concern was getting the air of uncertainty off the table. And I want to tell you, I'm thankful to all of our delegation, but always thankful to congressman Clyburn. He's never afraid to take a profile in courage, and step out and do firmly what he believes is right. And I'm thankful for his service.
MARTIN: Well, finally - because we're almost out of time. And as we mentioned - as actually, everyone here has talked about - that South Carolina's a politically conservative state, but there's also a very large federal footprint in the state, in part because of the military bases there; in part because as you mentioned, Fort Jackson is - which is the Army's largest training post; and also a number of college students; and also there are a number of retirees; and also the Medicare and Medicaid and Social Security imprint.
So, putting all of that together, gentlemen, I wanted to ask each of you, you know, there is another step to this process. So once this particular deal has been signed, a commission still has to come forward with additional steps and additional cuts. And so I wanted to ask each of you, from each of your particular perspective, what do you want to see happen in the final results?
So Mr. Mayor, why don't I start with you?
BENJAMIN: Sure. I know that all the members of our delegation have our state's best interest at heart. I would ask them to focus intently on defense spending and protecting the $7.1 billion in economic impact that Shaw Air Force Base, McEntire Air National Guard Base and Fort Jackson have on our community. Focus intently on public safety and jobs, and environment and sustainability.
Understand that this is a necessary conversation that we all know we need to have. America's got to get its fiscal house in order. But you - we have to make these cuts gradually, making sure that we keep our priorities in order: defense spending; making sure we take care of the least among us; keep our eyes focused on Social Security, Medicare and Medicaid as well.
MARTIN: Treasurer Loftis?
LOFTIS: I agree with Steve. But we've got to remember that no matter what happens from this commission, we have a jobless recovery and anemic growth, and that's the underlying problem. We have to have more economic activity. And much of that comes from the last five or six years of excessive spending, excessive government regulations, putting business and capital on the sidelines. The most powerful thing in the world is the U.S. tax code. We've got to incentivize growth and jobs, and that's how the American people will become free of these deficits and large debts.
MARTIN: Well, that's one reason why, you know, some here are saying - in Washington - that what really needs to happen is an overhaul of the tax code because the tax code is unbalanced...
LOFTIS: I agree.
MARTIN: ...where certain activities are advantaged, to the detriment of others. And do you agree with that?
LOFTIS: I sure do.
MARTIN: So if that kind of big-picture reform comes forward, would you think that this was worth it? Or do you still think - I guess, Mr. Treasurer, that was a question to you since you said this was all kind of a big theater, a big opera - do you think that it will have been worth it?
LOFTIS: Well, that would be a great encore. No matter what pain we go through now, if we could adjust our tax code so that there's more equity and it incentivizes growth in our economy, then I think whatever we go through now will certainly be worth it.
MARTIN: Mr. Benjamin?
BENJAMIN: Well, I think Curtis is right. But I will tell you this. More than a notion - I think South Carolina, along with several other states, tried to do that for the last several years. And it's a difficult process that's only amplified and on steroids once you get to D.C. So - but it would be a major one, a major one, for all Americans if we were to take it on and take it seriously.
MARTIN: Steve Benjamin is the mayor of Columbia, South Carolina. Curtis Loftis is the state treasurer of South Carolina. They were both kind enough to join us from Columbia. Previously with us, James Clyburn, the assistant minority leader in the House. He represents the 6th District of South Carolina in the House of Representatives. And he was here with us from his office in Washington, D.C. I thank you all so much for joining us, gentlemen.
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