Mr. Speaker, I appreciate the designation of the time and appreciate the opportunity to come to the floor tonight and discuss the issues, the very serious issues, that are in front of us. Now, this is something that we Republicans have talked about for quite a period of time that we had to get the Nation's fiscal house in order.
The reason we had to do this was because we had a spending issue that was in front of us. Many of us felt that running deficits of several hundred billion dollars a year was not acceptable, and we've watched what has transpired through the years as this has continued to grow. And we all know that the last few years of the Obama administration has run deficits, annual deficits, of well over $1 trillion.
Now, I am constantly hearing from people, how did this seem to happen so quickly? Well, it's been decades in the making. And as I said, indeed, many of us have come to the floor regularly, we've talked about it, and we've offered bills that would address this. A great example of this, every year I've offered bills that call for 1, 2 and 5 percent across-the-board spending reductions. Little bits add up over a period of time.
We have the appropriations process where Members have come to the floor and they've offered amendment after amendment that would reduce what we are spending.
We on this side of the aisle also believe that you have to have a budget. Now, the President had a proposed budget, and nobody wanted to vote for that. We put it on the floor, and I think it got one or two votes from the Democrats. The country has not had a budget in over 1,300 days, and there's a reason for this. It is because the budget that we have passed out of this House has gone to the Senate each and every year, and it sits on Harry Reid's desk, and he does not take it up.
We have passed this budget, and I commend Congressman Ryan who leads our Budget Committee. We passed it because we think you've got to tackle the drivers of the debt. You've got to bring out-of-control spending under control. You have to restore economic freedom and ensure a level playing field for everybody by putting an end to special interest favoritism and corporate welfare.
We feel as if it is imperative to reverse this administration's policies that are driving up the cost of gas at the pump, that we need to be promoting an all-of-the-above energy strategy unlocking American energy production to help lower costs, to create jobs, to reduce dependence on foreign oil, and to strengthen our health care and our retirement security by taking power away--away--from government bureaucrats and empowering patients and letting patients and doctors make the decisions that are important to them.
Now, as I said a moment earlier, so many times people will say, how in the world did we get here? Well, as I said decades--decades--in the making.
Then we went through the Budget Control Act exercise a year before last in August. We had a select committee that was put in place. That didn't work out. So we ended up with the sequesters. And many of my constituents--and I'm sure other Members are seeing this too--they are saying, Tell me what the sequester is all about.
This is what it is. It's going to take place on January 2, 2013, and the defense budget is going to see the brunt of these spending reductions. Most everything gets 2 percent across the board. With defense, you're going to see additional cuts of $55 billion per year. That is going to give them a total of $492 billion additional cuts. This is going to leave our military with the smallest ground force since 1940, the smallest naval fleet since 1915, and the smallest tactical fighter force in the history of the Air Force. Medicare could see $16.4 billion in annual cuts, leading to the elimination of 496,000 jobs in 2013. There will be 62,000 physicians that will be adversely impacted. We know that the sequester cuts are not fair to everybody.
As I said, we've been taking steps. Every year for several years, we've talked about getting the fiscal house in order and cutting spending and fighting the growth in the debt. We've also passed some bills this year. And I would like to remind the Members of the body, Mr. Speaker, of these pieces of legislation that this House of Representatives has already passed, and that are sitting on the desk over in the Senate.
On August 2 of this year, by a vote of 232-189, we passed the Pathway to Job Creation through a Simpler, Fairer Tax Code Act of 2012. That was H.R. 6169. It would provide an expedited pathway to pro-growth tax reform in 2013. To deal with the spending issues, to deal with the deficit, to deal with the debt, yes, you have to cut spending, you have to reform your Tax Code, and you have to have a pro-growth agenda. That legislation, as I said, was passed on August 2.
On September 19 of this year, we passed the National Security and Jobs Protection Act that would deal with the sequester that I spoke about a few minutes ago. That passed with 223 votes. We also had on May 10 the Sequester Reconciliation Act of 2012, H.R. 5652, which passed with 218 votes. We then had the Job Protection and Recession Prevention Act passed on August 1, and that was H.R. 8. It passed with 256 votes. H.R. 8 is the 1-year extension of all the tax rates.
We keep hearing that the President wants to extend the tax cuts for those making $250,000 a year and less. What that would do is catch a lot of our small businesses. About 20 percent of our small businesses have already said that this would adversely impact them to the point that they would be cutting jobs, not growing, but actually cutting jobs. So I would point out that 256 Members of this Chamber, on a bipartisan basis, voted to extend the tax cuts for everybody.
When people say, Why can't the House and the Senate get together, Mr. Speaker, our bills--as I've just mentioned, these bills are sitting on the Senate leader's desk dealing with the sequester, dealing with taxes, dealing with the reform issues that we have in front of us. These four bills are sitting there waiting for action. The House has done its job. We've agreed to not raise taxes on anybody. That's only one part of this issue.
Certainly, with the way the President is wanting to approach tax reform, his proposals would raise enough revenue to run the Federal Government for about 8 more days. He's going to raise taxes on the top 2 percent basically to pay for 2 percent of next year's spending. This is not sustainable. We do not have a revenue problem in this town, we have a spending problem. We have a crushing burden of debt. And now I've got some posters that I would like to show regarding that.
This first poster that I want to call your attention to points out exactly what we have in this crushing burden of debt. You will see that in World War II, it lays out our country's long history with this debt and shows where this burden has been passed. As I said, it's been decades in the making. Take a look at this. In 1940, the percentage of our gross Federal debt was 52.4 percent. That's where we were. By the end of World War II, the debt had skyrocketed. It was up to 117.5 percent of our GDP in 1945, and then it peaked in 1946 at 121.7 percent of our GDP. That was through the war. But you know what? We did what Americans generally do. When you have got a problem, you get behind it and you get it solved. So we doubled down on getting the spending under control, and you can see what happened. Then our Federal debt pretty much stabilized in the mid-30 percent range. And during the Reagan administration in 1981, the gross Federal debt was 32.5 percent of GDP.
Well, those old spending habits kind of diehard around this place. The Federal Government and the bureaucracy never gets enough of the taxpayers' money. When the President took office, our gross Federal debt was 84.2 percent of the GDP. This takes us back to swearing-in day in 2009. That's the figure that neither party could celebrate, and both parties share responsibility.
This Federal Government spends too much money and has for decades. Today, according to OMB, our projected gross Federal debt is 105.3 percent of our GDP. These are just simple facts. You can see what is going to happen if you look at where we are headed. Now we are over 100 percent. Look at how quickly we're going to get to 200 percent, then 300 percent, and 400 percent.
This points out how unfair this debt is to our children and grandchildren. Indeed, Mr. Speaker, I think the debt that we have in this country is the ultimate cap-and-trade. What is happening? We are capping our children's futures, and we're trading it to the countries that own this debt.
Let me point out who owns this debt. I've got another chart that I want to show you on this specific issue. A lot of people will ask about this. And of course last year during the debates on the debt, we had so many discussions about this. A couple of my colleagues and I went down, and we asked who owned our publicly traded debt. We wanted to know who was buying this American debt. Of course, we've been frustrated with the Fed monetizing some of this debt and running the printing presses. We know that devalues it. We're frustrated that we are running about $4 billion worth of debt a day, and that is adding to the annual deficit, which accrues to the Nation's debt. That frustrates us. So what we've done periodically in my office, Mr. Speaker, is to go back in and check with Treasury and see who owns our debt.
As of right now, China owns $1.15 trillion of our debt. Then number two on the list is Japan with $1.13 trillion of our debt. This is interesting. Out of this debt, number three on the list is OPEC. OPEC is an entity. That's the countries of Ecuador, Venezuela, India, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the UAE, Algeria, Gabon, Libya, and Nigeria. Guess what? They now are number three on the list, and they own $267 billion of our debt. Brazil comes in at number four, $250.5 billion. And then number five on the list--new to the top five list--the Caribbean Banking Centers, who now own $240.4 billion of U.S. debt. By the way, the Caribbean Banking Centers are the Bahamas, Bermuda, Cayman Islands, Netherlands Antilles, and Panama. This is who owns us. This is who owns our debt. This is why on this side of the aisle what we continue to say is the spending has to be dealt with.
We've heard from everybody. We are hearing from economists all around the globe, and they repeatedly say what we are saying, what we've been saying for years as we've come to this floor, that we have a spending problem. The spending has to be dealt with. We are drowning under a mountain of debt. You cannot continue to borrow nearly 50 percent of what you are spending. We think that it is problematic, if you will, Mr. Speaker.
It is disconcerting that the President doesn't want to talk about the spending, but is instead offering to raise enough taxes to fund additional spending for 2 percent of the year by raising taxes on the top 2 percent. I guess he's not worried about the other 98 percent of the year. This is how we have to get this under control, by reducing this spending.
I'm so pleased to be joined by my colleagues who share a passion for freedom and for economic freedom, and understand that economic freedom and political freedom are linked, and that this is a task that we are passionate about, we are given to solving this problem so that we remain a free Nation.
At this time, I want to recognize the gentleman from West Virginia (Mr. McKinley).