On the recordJune 9, 2010
I support transparency. I think most of us do, certainly in concept. I support the transparency and deficit reduction goals of the Cornyn-Kyl amendment. But that amendment is unworkable. Why? Because it requires Treasury to speculate about the intent behind foreign purchases of U.S. Treasuries. How in the world is Treasury going to be able to know the intent behind foreign purchases of U.S. treasuries? The Cornyn-Kyl amendment also sends the wrong message that the United States is deeply suspicious of foreign holders of U.S. debt, and it potentially could chill foreign purchases of U.S. Treasury bonds. I do not think we want to do that now. Purchases of U.S. Treasury bonds have held interest rates very low. We are very lucky. We are very lucky. I do not think many appreciate this: With the budget deficits we have, and even with unemployment way too high, things could be much worse; that is, if interest rates were much higher. But investors like the safe haven of U.S. Treasuries--and that is domestic and foreign purchases of U.S. Treasuries--and that is helping to keep interest rates down at very low rates, and that is keeping inflation down at very low rates. We are lucky that is a condition we are experiencing in the United States today. With America just beginning to recover from the financial crisis, we cannot risk our ability to finance the debt. We cannot risk it. For those reasons, I must oppose the Cornyn amendment.
