[Congressional Record Volume 140, Number 17 (Thursday, February 24, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: February 24, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                BALANCED BUDGET CONSTITUTIONAL AMENDMENT

  Mr. SIMPSON. Mr. President, I wish to support the constitutional 
amendment to balance the budget as proposed by my very able colleagues, 
Senators Simon, Hatch, Craig, and others.
  Over the years I have been involved in this one, we have taken all 
the hard shots that they can fire at us. I can remember when we 
started, Senator Heflin, Senator DeConcini, Senator Thurmond, Senator 
Hatch, when I was in my first year on the Judiciary Committee.
  The arguments in favor of and against this amendment have, it seems, 
been repeated time and time again in this Chamber. I do not even have 
in front of me a large stack of remarks now because we have all heard 
everything. But I wish to commend Senator Simon. He is persistent, 
genial, persevering, and he needs all these qualities together with his 
journalistic background that enables him to persevere here and to take 
on the hysteria which we often find in the opposition.
  We now have the AARP geared up fully. There are 34 million people in 
the American Association of Retired Persons. I have said all this 
before. You need to be 50 years old and have $8 and then you can become 
a member. You must have a common love of airline discounts, automobile 
discounts, and pharmacy discounts in order to prevail properly.
  This organization has the power, once again, to not only knock off 
the balanced budget amendment, but health care reform, or anything else 
they gear up to do in. But the saddest part of it is that 95 percent of 
their members have no idea what their principal function is or their 
philosophy.
  I have looked into their organization. I will be doing more of it in 
this Chamber. I will not take time now, but just to  tell you again 
that they are a remarkable ``nonprofit organization'' that has a $9 
billion cash flow, the old AARP. They have their own law firm to which 
they pay $2.5 million of retainer per year, with one of the founders 
involved there.

  They have a little manual that goes out to their field people that if 
the field people cannot ascribe to the basic philosophy of the AARP as 
in the manual in headquarters, they are subject to immediate dismissal. 
They have a yield on their investments of $37 million. Imagine what the 
principal would be on those investments. Seven percent yield, 6, what 
do they receive?
  Ask for their forms. Read them. They receive 4 percent of every 
single penny they place with Prudential Life Insurance or Prudential 
anything or any insurer; they receive 4 percent of the premium into 
their own coffers. And they receive a $80 million grant from the 
Federal Government for reasons that must be totally unknown to any 
sensible taxpayer because of that kind of cash flow.
  If you were to look at their proposals for the future in America, it 
provides that this Government would be required to spend in excess of 
$600 billion in the next 7 years to satisfy the basic legislative 
proposals or programs of the AARP.
  I will be going into much more with regard to that organization in 
the future. Someone should because, as I say, they have the power to 
destroy whatever we try to do with regard to health care. And I saw 
them come into action these last few weeks. They are now fully geared 
up, along with the Committee for the Preservation of Social Security 
and Medicare, another group who are still looking to take care of the 
notch babies which would only cost $200 billion or so, and it would all 
come out of the Social Security funds.
  So here we now see them saying that people are going to lose their 
Social Security payments. They even picked a figure from the sky 
somewhere as to what folks would lose. I think it is egregious. 
Certainly Americans should begin a probe of this group and see just 
exactly, as we would do with any legislator or anyone in public life, 
what it is they do, from whence do they spring, and how do they make 
their money, and what do they do with their money other than provide 
these remarkable things to seniors and to their staff and to their 
field people at salary levels which would boggle the mind.
  Well, other than that feeling there about that, of which I have now 
rid myself--any arguments I would repeat have been heard time and time 
again. I will not ask my fellow colleagues to listen to yet another 
repetition of the arguments so well advanced by my colleagues.
  But I would instead wish to address my remarks to the nature of the 
debate itself. As so often happens around this Chamber, it is easy for 
individuals on one side of the debate to subtly impugn the motives on 
the other side. ``Inconsistency'' is something that we so often detect 
in the reasoning of others although, indeed, hardly ever, nearly never 
in our own positions. Inconsistency is often, of course, a polite way 
of alleging hypocrisy or worse, but I bring this up because I have 
heard it said that proponents of the balanced budget amendment, and I 
am one of them and have been from the beginning, have been 
``inconsistent.''
  It has been said that the Senators who favor the balanced budget 
amendment at the same time are the ones who refused to cast votes in 
favor of spending cuts. I heard this charge. I asked myself, ``Could 
this be so?'' It certainly would cast doubt on the sincerity of the 
amendment's proponents if it were. So I decided to find out for myself.
  There are a great number of organizations around this village that 
track the voting records of the Members of Congress from every 
philosophy. I was in touch with one of them, the National Taxpayers 
Union Foundation, and I wanted an index of every vote. I am not talking 
about cosponsorships--I am talking about every vote cast by Senators in 
this body, weighted by how much money we were voting to spend. I did 
not want some isolated instance here, some single anecdote to hurl at a 
colleague on the other side of the aisle, or my own side of the aisle 
like, ``Remember when you voted for the Super Collider?''
  That proves nothing. We have all been there. We have all voted to 
spend money at one time or another on things very near and dear to us 
without a qualm, and we will continue to do that forevermore.
  But I wanted to find out what were the total spending habits of those 
Senators who supported this balanced budget amendment, and to compare 
them with the opponents of the amendment. So I took as my reference 
July 1, 1992, the cloture vote on the balanced budget amendment. On 
that date, 56 Senators voted in favor of cloture to cut off debate so 
that we could proceed to vote on the amendment, and 39 Senators voted 
in opposition. Then I looked up the spending records in the Second 
Session of the 102d Congress of the 56 Senators who voted for cloture, 
and of the 39 Senators who voted against cloture.
  The National Taxpayers Union tabulates every vote cast in this body, 
not cosponsorships, and weights it according to how much money we are 
then voting to spend.
  Let me quote from their pamphlet: ``We analyzed every rollcall vote 
taken during the Second Session of the 102d Congress and selected all 
votes that could affect the amount of Federal spending.'' They produce 
an index on that basis. The better your record in voting to cut 
spending, the higher your rating on a scale of 1 to 100.
  What I found, and I must tell my colleagues, is that the statement 
made here on the floor the other day is totally and simply wrong. There 
was an assertion made that the proponents of the amendment do not vote 
to cut spending. That was made in not only the forum here, but also in 
a different forum. In fact, that statement could not be more wrong. It 
is directly and wholly refuted by the facts. Just the opposite is true.
  It is true, in fact, that the supporters of this amendment are the 
Senators most likely to cut spending. Let us be very clear and up front 
about this. Fifty-six Senators voted to invoke cloture on the balanced 
budget amendment when it was last considered. The average ``spending 
cut'' score of these Senators was 54.6. This is the average ``spending 
cut'' score of those 56 Senators--54.6. The 39 Senators who voted 
against cloture, effectively voting against the amendment, obviously, 
had a score of 26.4, less than half as impressive or as good as the 
proponents. In fact, the opponents' collective score gives them an 
``F'' grade on the National Taxpayers Union Foundation scale, putting 
them as a group in the ``big spender'' category.
  So let us be very clear that this supposed internal inconsistency 
simply does not exist. The National Taxpayers Union Foundation ranks 
the various Members of the Senate according to how much they vote to 
spend, and I list the Senators who most consistently voted to cut 
expenditures: Senators Smith, Brown, Craig, Symms, and my colleague 
from Wyoming, my old friend, Malcolm Wallop. Every one of those 
Senators voted in favor of the balanced budget amendment, every single 
one of them.
  Of the Senators who are listed as the biggest spenders, I will not 
give their names. I will not list them here, but every single one of 
them voted against the balanced budget amendment. Their names are in 
the literature to be reviewed, if anyone would wish to.
  So I just think it is important to try to stay with the facts. The 
correlation at the extremes is absolutely perfect with what we see with 
spenders versus those who wish to cut the budget.
  Then let us all remember. At least I was here in armed combat when we 
did the amendment in May of 1985 where we voted to get rid of 23 
agencies of the Federal Government, voted to freeze the entire Federal 
Government except Social Security, which we could allow to rise only 2 
percent. Everything was to be frozen in place. The vote was 50 to 49.
  I can tell you, I call that heavy lifting. Oddly enough, that was a 
bipartisan vote. Our colleague, the Senator from Nebraska, the close 
friend of the Senator now occupying the chair, was the controlling 
vote. We all remember Senator Ed Zorinsky, a very wonderful addition to 
this place and a very principled man. He took a tough vote. It was a 
tough, tough time for those of us that took that vote because in the 
next general election six of the people in my party who voted that way 
were blown away by the electorate.
  All the various interest groups, like the one I just named in the 
origin of these remarks, did the 30-second spots or helped pay for 
them, and said: ``There is the slob that cut your Social Security;'' 
this is the slob that took your veterans' benefits; there is the guy 
that took your railroad retirement; this is the person who did this and 
this and this and this.
  Who is to do the heavy lifting? We do not do it here. This amendment 
may be shock therapy. But it would be the kind that this country could 
use. Does anyone believe honestly that you are going to do something 
with a debt, which is $4.5 trillion and a budget which is $1.5 
trillion, and a deficit--depending on who you choose to believe--
between $167 billion and $287 billion, that it is all going to be 
resolved without some pain or some sacrifice from those of us here, in 
this Chamber? Whether it has to do with our own pension, whether it has 
to do with things with us and with those out there, there is going to 
be pain and sacrifice connected with this, or we will simply not get it 
done. No one needs to even guess as to how else we are supposed to do 
it.
  But when the interest groups, whose sole function in life is to keep 
up their membership by terrorizing the Members, continue to range 
around the country distorting every facet of what we do--and many of 
such groups in this country now are functioning on the basis of first 
taking care of their executive directors, their staffs, and assuredly 
their pension plans, their investment proposals, their retirement 
proposals, and very little of the money really goes to what they say 
they stand for--that is now a unique and extraordinary thing in our 
country.
  The sole purpose and the sole method then for them to continue their 
``good works'' is to terrorize the Members by simply telling them that 
the Congress is inept, greedy, overreaching, picking their pocket, 
ripping off the trust fund, all the rest.
  Please know there is no separate pot of money called Social Security 
Trust Fund. When are we going to quit listening to that garbage? The 
money presently in the reserves of the Social Security System is, by 
law, to be invested in the securities of the U.S. Government. That 
means T bills, that means U.S. Treasury securities, it means savings 
bonds. There is no separate ``fund.'' We do not rob the fund. There is 
no fund to rob. If this Government ever had a pot like that they could 
dig into, and the tabulated ``reserves'' I think are about $200-some 
billion now--we would have discovered a new door on Fort Knox.
  All of the Social Security money is invested in Federal securities. 
The Federal securities are purchased by people in real life. They are 
purchased by union pension funds. They are purchased by teachers' 
funds. They are purchased by the AARP, probably. And they are valid 
obligations of the Federal Government, backed by the ``full faith and 
credit'' of the Federal Government.
  Then when those are purchased, the interest on those issues is paid 
from the General Treasury. It is not paid from some separate kitty. It 
is not paid by the Social Security Trust Fund. That interest is paid by 
the taxpayers of the United States of America separately.
  So let us put that one to bed. I hear it all the time. I do know who 
spreads it. Indeed I do. But let us put that one away because that is 
another hysterical move to try to petrify the American taxpayers and 
the members of the special interest groups.
  Keep that all in perspective as we get into the debate--that this is 
the truth about Social Security and that we have never continually 
raided the Social Security ``fund.'' One time in my 15 years here, I 
think for 72 hours, there was an intrusion into the Social Security 
fund. We quickly remedied that and allowed that was never going to 
happen again and that we would not allow it to happen again, and it 
never happened again.
  So there is much more that I will say in the days and the weeks to 
come as we deal with the really tough issues of the day. I have been 
honored to be selected to be on the Entitlements Commission as 
appointed by the President. It consists of a remarkable group of 
Democrats, Republicans, liberals, conservatives, businessmen, and 
special-interest-group personnel, and there is not one of us that does 
not know, who needs to be taught in any way, what the problem is. We 
all know what the problem is: It is whether we will ever do something 
about it.
  I do hope we will not continue to hear that there is some great 
hypocrisy rampant in the land among those supporting the balanced 
budget amendment or some inconsistency between the proponents' 
positions on this issue and their voting records as a whole. There is 
not. It is not there.
  Senators supporting this amendment are, for the most part, the same 
Senators who have been voting to cut spending, and historically that is 
so. The correlation is clear, and it is quite unambiguous. I hope this 
might put to rest any further aspersions on the sincerity of the 
proponents of the balanced budget amendment.
  I thank the Chair.
  Mr. SIMON. Mr. President, following the remarks of my colleague from 
Wyoming, I would like to make a few comments and then talk about an 
amendment we may be voting on before too long, or will be discussing 
before too long. First, on what Senator Simpson says about those of us 
who are sponsoring this, there was a release by the National Taxpayers 
Union that took cosponsorship of legislation and added that up, and I 
looked like a huge spender because, among other things, I am 
cosponsoring two different health care bills. Total that up, and it is 
a huge amount.
  I asked my staff to total the appropriations that we voted on and the 
appropriations cuts last year for the total year. On that, I end up one 
of the top third in the Senate in terms of cuts in appropriations. It 
may be of interest to this body that the No. 1 person in the U.S. 
Senate in terms of voting for appropriations cuts is our colleague, 
Senator Herb Kohl, from Wisconsin, who is a cosponsor of the balanced 
budget amendment.
  Second, Mr. President, I want to enter into the Record at this point 
a column by George Will that was printed this morning in the Washington 
Post. I will read the first paragraph because it kind of outlines where 
he is going:

       Opponents of the constitutional amendment that would 
     encourage--no more than that--balanced budgets rely on 
     arguments that devour one another. They say the amendment is 
     an inconsequential gimmick--and they say it would eviscerate 
     government. They say the amendment is unnecessary because 
     Congress can be trusted to act responsibly--and they say 
     Congress cannot be trusted to respect the amendment if it is 
     put into the Constitution.

  Anyway, he says very clearly that we need a balanced budget.
  I ask unanimous consent that the article be printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

                       [From the Washington Post]

                        Arguments Out of Balance

                          (By George F. Will)

       Opponents of the constitutional amendment that would 
     encourage--no more than that--balanced budgets rely on 
     arguments that devour one another. They say the amendment is 
     an inconsequential gimmick--and they say it would eviscerate 
     government. They say the amendment is unnecessary because 
     Congress can be trusted to act responsibly--and they say 
     Congress cannot be trusted to respect the amendment if it is 
     put into the Constitution.
       The wizards in the White House, tightly in the grip of the 
     conceit that the future is to them an open book, say the 
     amendment would force grim choices costing the average Social 
     Security or perhaps Medicare recipient at least $1,000 a 
     year, and they have listed the annual cost of the amendment 
     to each state. Vermont? $418 million. How does the White 
     House know so much about choices the nation would make under 
     a constitutional requirement to align revenues and outlays?
       Besides, another argument made against the amendment is 
     that instead of making grim choices, Congress would make a 
     mockery of the Constitution. This argument, coming from 
     members of Congress incapable of blushing, is: Trust us, not 
     the amendment, to achieve fiscal discipline, because we are 
     so untrustworthy we would treat the amendment as more 
     loophole than bridle. ``Emergencies'' would be declared 
     promiscuously, programs would be put ``off budget,'' receipts 
     and outlays would be redefined, cost and revenue projections 
     would be cooked--in short, there would be even more of the 
     trickery that now goes on.
       Sen. Carl Levin, a Michigan Democrat opposed to the 
     amendment, notes that it ``relies on statutory definitions 
     that can easily be changed,'' such as the definition of 
     ``fiscal year.'' He warns that Congress might redefine 
     ``fiscal year'' to mean ``eleven months or three years.'' Oh. 
     Congress is so cynical, don't bother trying to bind it with 
     constitutional fetters? Does Levin have such a low opinion of 
     his colleagues that he thinks it would be easier to fiddle 
     the meaning of ``fiscal year'' than to get 60 percent of both 
     houses of Congress honestly to authorize a deficit, as the 
     amendment allows?
       The word ``crisis'' has become another classification used 
     so casually that it no longer classifies. Even so, it is 
     peculiar to say (as does Lloyd Cutler, who was counsel to 
     President Carter) that there would be a ``constitutional 
     crisis'' if an ``emergency''--say, many hurricanes and 
     earthquakes--necessitated spending that required a 
     constitutional super-majority to authorize a deficit. If the 
     ``emergency'' could not catalyze 60 percent of Congress would 
     it really be much of an emergency?
       Opponents of the amendment warn that it deprives the 
     government of ``flexibility'' needed to adjust fiscal policy 
     to stages of business cycles. Of course this argument cannot 
     be used by opponents who say the amendment would be too 
     porous to inhibit the government. And this argument requires 
     faith in the government's aptitude for fine-tuning fiscal 
     policy to ``manage'' the economy. And the people making this 
     argument must explain this: Flexible government, 
     unconstrained by a balanced budget requirement, has run 
     deficits at every stage of every business cycle since the 
     last balanced budget, in 1969, and President Clinton, who 
     opposes the amendment, projects deficits far into the future.
       When the deficit was around $300 billion, critics said the 
     balanced budget requirement was ruinously Draconian. Now that 
     the deficit has temporarily dipped below $200 billion 
     opponents say the requirement is unnecessary. And opponents 
     say that projections of rising deficits by the end of the 
     decade mean that the requirement soon would be ruinously 
     Draconian.
       Yes, if Congress passes the amendment, the states, which 
     get about 20 percent of their money from Washington, might 
     reject it. (Thirteen states can stop an amendment. That limit 
     on majoritarianism is more substantial than the mild 
     requirement of a 60 percent vote to run a deficit.) Yes, 
     Congress might respond to a balanced budget requirement by 
     stepping up its ``spending by indirection''--imposing 
     unfunded mandates on the states, regulating business, and so 
     on. (Last year the Clinton administration regulations filled 
     69,688 pages of the Federal Register, the third highest total 
     in history, behind only the last two Carter years.)
       Which is to say, the balanced budget amendment can 
     inconvenience legislative careerists but cannot make them 
     virtuous. Which brings us to the source of the real passion 
     against the amendment: deficit spending is, in effect, public 
     financing or the campaigns of incumbents, enabling them to 
     charge only 75 to 86 cents for every dollar of government 
     they dispense. So the vote on the amendment is a referendum 
     on a political style: borrow and borrow, spend and spend, 
     elect and elect.

  Mr. SIMON. Mr. President, I would like to put anybody on notice that 
there will be an amendment offered by my friend and colleague, Senator 
Harry Reid of Nevada. Senator Reid, in my opinion, is one of the finest 
Members of this body. He has shown courage; he does his homework; he is 
a hard worker. I have great respect for him. He is one of the people I 
have traveled with and have come to know, and I just have tremendous 
respect for him. He is willing to face new ideas.
  But the amendment he is offering--no one should be fooled--is not a 
balanced budget amendment. I will go into more detail when we get into 
the debate after it is introduced, but it says: Estimated outlays have 
to match estimated receipts.
  Now, we permit estimation in our amendment. You have to do that. But 
it says outlays have to match receipts; receipts have to match outlays. 
That is a very different thing than requiring that estimates be 
balanced.
  Second, it says ``estimated outlays of the operating funds of the 
Federal Government.'' That is suggesting that we would have a capital 
fund and an operating fund. We do not need that. The biggest public 
project program in the history of humanity was our interstate highway 
system. It was suggested, to his credit, by President Eisenhower. But 
he suggested we issue bonds for it, and to the credit of a United 
States Senator by the name of Albert Gore--Albert Gore, Sr.--he said: 
Let us increase the gasoline tax and do it on a pay-as-you-go basis. 
And we saved, believe it or not, over $800 billion in interest by doing 
it that way.
  What is the biggest single project we have today? It would be a 
nuclear carrier. That is done over several years. That would be $1 
billion, at the most. It is very interesting that GAO makes very, very 
clear, in study after study after study, that, yes, you should separate 
your investment from your consumption in the budget, but do not go to a 
capital budget where you use that as an excuse for deficits.
  Second, things like the Congressional Budget Office are named in the 
amendment, or our Social Security System is named. We do not, in the 
Constitution, name the Department of Defense or the Secretary of 
Defense or the Secretary of Interior, or others, and then there is no 
muscle behind it. Just to make sure that games are not played in our 
amendment, we say that if you want to increase debt, you have to have a 
three-fifths majority. That puts real muscle in this thing. There is no 
muscle in this one. He has, for example, one provision that I would 
vote for statutorily. It says that Congress may, by appropriate 
legislation, delegate to an officer of Congress the power to order 
uniform cuts. I would vote for that as a statute, but we do not need it 
in the Constitution.
  Let no one be deceived--this is designed as a way to give cover to 
Members of the U.S. Senate who want to both please the administration 
and my friend and colleague, Senator Byrd, and to go back home and say, 
``I voted for a balanced budget amendment.'' Anyone who votes for the 
Reid amendment and votes against the Simon-Hatch amendment has not 
voted for a balanced budget amendment. Let no one be deceived on that 
score.
  I know we are going to have a good debate, and I look forward to 
participating in that debate.
  The PRESIDING OFFICER. Senator Hatch is recognized.
  Mr. HATCH. Mr. President, I appreciate the cogent comments of my 
colleague, Senator Simon, on this matter.
  Look. We all have been in this legislative arena for a long time. 
When people have a tough issue, they try to get a facade amendment to 
pass so that people can vote for something so they do not have to vote 
for the real amendment.
  Mr. President, that is what is happening here. The fact is that the 
real amendment is the Simon-Hatch amendment. Everyone hopes it will be 
enforced. Everyone knows it will work. Everyone knows it will put the 
fiscal discipline and the fiscal restraints on Congress that are 
appropriate under these circumstances of almost 60 years of not 
balancing the budget and running it into a debt of $4.5 trillion.
  Mr. President, the distinguished Senator from Illinois summed up our 
criticisms pretty well. We will take time either tomorrow or Monday and 
shred this amendment alive because it does not make sense. It certainly 
will not be needed to balance the budget. It certainly is not a 
balanced budget amendment. It is a mere cover-your-backside amendment 
that will allow people to vote for an amendment, and then vote against 
the real balanced budget amendment. I do not want anyone to misconstrue 
it.

  The amendment we have to pass is the Simon-Hatch amendment if we want 
a balanced budget amendment to the Constitution and we want to get it 
through both Houses of Congress. If we do not do that, everyone knows 
this is just a game and there is no question about it.
  We will have more to say about it later.
  Mr. President, I ask unanimous consent that my next remarks be as if 
in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________