[Congressional Record Volume 140, Number 25 (Wednesday, March 9, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: March 9, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]


                              {time}  1840
 
                      REPUBLICAN BUDGET PROPOSALS

  The SPEAKER pro tempore. (Mr. Strickland). Under the Speaker's 
announced policy of February 11, 1994, the gentleman from Ohio [Mr. 
Kasich], is recognized for 60 minutes as the designee of the minority 
leader.
  Mr. KASICH. Mr. Speaker, I just wanted to take this special order 
tonight to work with some of my colleagues to talk about a very 
exciting proposal that the Congress is going to begin debating 
tomorrow. This proposal is the House Republican budget alternative 
proposal to the President's budget. I want to spend a little bit of 
time talking about this, and I hope that some of my colleagues will be 
joining me to discuss the budget. But in a nutshell, I wanted to kind 
of go through the process of what House Republicans did to put this 
budget together.
  Mr. Speaker, you might all remember that back last February the 
President came to Capitol Hill and he said that if you do not like my 
tax and spend proposal, and he looked over at the Republicans, he said, 
well then show me your specifics.
  You might remember that the House Republican Committee on the budget 
sat down and we broke down into working groups on the activities of the 
Federal Government, and we were able to put together a proposal that 
did exactly what the President challenged us to do. We presented our 
specific budget proposal that eliminated as much of the deficit as the 
President did, without one penny worth of taxes. We downsized the 
Federal Government and we were able to meet the challenge with 
specifics.
  Unfortunately, that budget was rejected in favor of the tax and spend 
budget that passed this House floor.
  Then later in the year we had the reconciliation tax part of that 
budget, and again the majority said if you do not like our tax 
increases, give us your specifics.
  We went back to work and we developed our specifics, and we laid them 
on the table, and we showed how we as House Republicans believed that 
we could downsize the Government by reforming the Federal Government, 
and not having to raise taxes on the American people, but rather 
adopting a program of reform in this city.
  We one more time were defeated.
  It was soon after that the gentleman from Minnesota, a Democrat [Mr. 
Penny] came to me and said would you be willing to work on additional 
spending cuts? We just jumped at that opportunity. Mr. Penny and I, 
along with 28 other Democrats and Republicans, tried to cut a penny on 
a dollar over the next 5 years, totaling $100 billion in spending, and 
we did that in an effort to try to create a momentum for reforming and 
downsizing the Federal Government. One more time we were defeated.

  Then when we came back in this year, Mr. Penny and I, along with Mr. 
Nussle and Mr. Condit, got together for purposes of paying for the 
earthquake. We said yes, we believe we need to send money to people in 
California, but we believe that it ought to be paid for. We ought not 
to put this on the back of the kids in this country, and we put our 
proposal together with our specifics. And one more time we were 
defeated.
  Now the President came to Capitol Hill to deliver this State of the 
Union speech, and he outlined his budget proposal, and he talked about 
how tough his spending cuts were in his proposal. And he said to the 
Republicans, if you do not like my budget proposal, then show me what 
your specifics would be. And the Republicans on the House Committee on 
the Budget went back to work.
  We in fact have put together a budget, and have one more time not 
only met, but won the challenge that the President laid out to us.
  Last week in the committee, we were defeated on a party line vote. 
But tomorrow we will begin the debate on this House budget resolution. 
We hope that not only will we have the strongest support from 
Republicans in years, but in fact we are going to see Democrats come 
across the aisle and support this proposal. And why should they?
  Well, if you look at the President's budget proposal, if the 
President had not sent a budget to Capitol Hill, and if the President 
had only decided that he would let the programs go on automatic pilot 
and just let automatic spending increases occur, believe it or not, we 
would have lower deficits under a budget that would be described as an 
automatic pilot budget than we have under the President's budget.
  In other words, the President's budget, which is labeled as tough on 
spending, increases the deficit more than if he had done nothing.
  We did not find that acceptable, and in fact we thought that the 
challenges that the President laid down at the State of the Union 
needed to be met. And we believe that it was important that we not just 
talk about crime legislation, but that in effect we provide communities 
with help for more prisons and more police on the streets. We thought 
it was important that we make a first down payment on health care, to 
try to address the problem that most Americans are saying we have got 
to do something about. We have a health care reform provision in our 
budget. And we also believe that we should not just talk about welfare 
reform, but that in fact we ought to present and lay down our specific 
welfare reform proposal, which is precisely what House Republicans did 
in their budget.
  Furthermore, we also believe that it is necessary to provide 
incentives to businesses so they can invest in plant and equipment, 
become more efficient, hire more Americans, and help to not only 
increase productivity in America, but to provide for greater 
prosperity, relying on the private sector. And finally, perhaps the gem 
of the Republican budget proposal, is something that the President 
promised over a year ago, and that was middle income family tax relief.
  What the Republican budget proposal provides is for a $500 tax credit 
per child per family up to $200,000. It is really the middle income tax 
cut that the President promised in the campaign.
  Mr. WALKER. If the gentleman would yield, surely the Democrat's 
budget contains those things too. Surely the Democrat's budget, where 
the President talked so much about health care reform, surely the 
Democrat's budget has health care reform in it, and surely welfare 
reform.

  Mr. KASICH. No, it does not.
  Mr. WALKER. They do not have health care reform in their budget?
  Mr. KASICH. There is no health care reform in the President's budget.
  Mr. WALKER. What about welfare reform? Surely that is in the budget. 
The President has talked so much about welfare reform.
  Mr. KASICH. There is no welfare reform in the President's budget.
  Mr. WALKER. But the President came up here and told us about that. 
What about crime? The President has said that the crime bill is a major 
priority. Surely they have included the crime bill?
  Mr. KASICH. There is some spending in that area. But I would say to 
the gentleman, we have not seen a crime package that is contained in 
this bill.
  Mr. WALKER. So they do not have that. Well, this would be the year to 
do that.
  Mr. KASICH. I must also say to the gentleman, there is no family tax 
relief.
  Mr. WALKER. This is the year you would think they would come back 
with that. You mean that the President has reneged on the promise to 
the American people on tax relief for middle income families in this 
budget as well?

                              {time}  1850

  Mr. KASICH. I want to say to the gentleman that the Republicans 
basically felt that we better make good on that promise.
  Mr. WALKER. So the Republican budget has health care reform that the 
President does not have. It has crime reform that the President does 
not have. It has welfare reform that the President does not have. It 
has tax relief that the President does not have.
  Mr. KASICH. And incentives for business.
  Mr. WALKER. I assume what we do then in our budget is we probably 
have to raise taxes in order to do this.
  Mr. KASICH. I would say to the gentleman, that is what makes the 
document so remarkable, because in every single year of the 5-year 
budget the Republican budget alternative has lowered deficits, every 
single year of the 5 years, totaling $150 billion less in deficits than 
the President.
  Mr. WALKER. Do we get there by raising taxes?
  Mr. KASICH. No, we do not. We do it by downsizing the Government.
  Mr. WALKER. So if I understand this, we have lower deficits than the 
President. We have more in the way of reform than the President's 
budget, and we do not raise taxes at all.
  Mr. KASICH. In fact, we give tax relief to middle-income Americans.
  Mr. WALKER. So middle-income America is actually going to get some 
tax relief that they do not now have, and they are going to get these 
reforms. And they are going to get lower budget deficits out of our 
budget, and the Democrats do not have any of this in their budget.
  Mr. KASICH. That is correct.
  I would say to the gentleman from Pennsylvania that in the State of 
Pennsylvania there are 2,322,808 children whose families would be 
eligible for this $500 tax credit. It would save the people of 
Pennsylvania, would send $1,161,404,000 back to those taxpayers.
  Now, this is not a wish budget. This is not smoke and mirrors. We 
have paid for every single section of this budget proposal that we are 
making.
  Mr. WALKER. By downsizing government.
  Mr. KASICH. By downsizing government. Should we cover a few of the 
things that we do?
  Mr. WALKER. I mean, 2 million kids is an awful lot of people in 
Pennsylvania to get covered.

  Mr. KASICH. More than $2,322,000.
  Mr. WALKER. Do I understand correctly that, for instance, if there is 
a family of five and they are middle-income Americans, they make 
$40,000, $50,000 a year, as dual-income family or even less, and they 
have, so they have three kids, that they would get $500 for each of 
those kids?
  Mr. KASICH. They would get $1,500 worth of a tax credit against the 
money they owe the Federal Government; that is correct.
  Mr. WALKER. That is big time for most middle-income families. Do you 
realize that middle-income families pay on an average of about $5,000 
in taxes each year, and we are going to give them a $1,500 tax credit 
with this proposal. That really does do something real for middle-
income Americans.
  Mr. KASICH. Yes, and I would say to the gentleman that this tax 
relief is paid for. This is not some pie-in-the-sky where we want to 
pass out money to people. We have paid for every provision in this 
bill, and we are still $150 billion less in deficits than the 
President. And we did it, I say to the gentleman, by not protecting the 
Washington establishment. We did it by looking in virtually every nook 
and cranny of the Federal Government, and we have privatized some 
programs. We have eliminated some wasteful programs. We have brought 
innovation to a whole variety of these programs.
  Let me say this to the gentleman: For the Members here who have voted 
on Penny-Kasich, many of the things contained in the Penny-Kasich 
proposal are in this budget. The Budget Director himself, Leon Panetta, 
said that Mr. Penny and Mr. Kasich ought to vote for the President's 
budget, because 75 percent of Penny-Kasich is in their budget.
  Well, we are going to use some of the savings from Penny-Kasich, some 
of the savings that the gentleman himself, from Pennsylvania, has 
suggested. And what we do is, we down-size the Federal Government.
  And we take some of the savings from the down-sizing. We share some 
of them in terms of deficit reduction, and we share another fraction of 
those savings with the American people who pay the bills that run this 
place.
  Mr. WALKER. This is going to make the Washington establishment pretty 
angry. They are going to be rather angry that you are going to take 
money from them.

  If I understand correctly, what we are going to end up doing is 
making the Washington establishment angry, but the middle-class 
families in the country happy.
  Mr. KASICH. I think we will make most of Americans happy, because not 
just the provision on families but the provisions that do things like 
index the capital gains tax.
  Mr. WALKER. That helps small business people.
  Mr. KASICH. Absolutely. Not only that, but take a senior citizen who 
brought a house and paid $50,000 for it. And the time has come where 
they want to sell their house, and they sell it for $100,000. And 
inflation could be accounted for $30,000 of the difference. In other 
words, they paid $50,000. They are going to sell it for $100,000. But 
there is only $20,000 more in real value to that house. They should not 
have to pay taxes on the inflation.
  So it is going to help. It is going to help anybody that sells a 
home. It is going to help anybody that has a business.
  And guess who else it is going to help? The American worker. That is 
who it is going to help.
  Mr. WALKER. All at the expense of Washington bureaucrats.
  Mr. KASICH. Yes, at the expense of Washington bureaucrats.
  Mr. DICKEY. Mr. Speaker, will the gentleman yield?
  Mr. KASICH. I yield to the gentleman from Arkansas.
  Mr. DICKEY. Mr. Speaker, I need some information from the gentleman.
  What are the figures for Arkansas, as far as what we will get in our 
economy?
  Mr. KASICH. Well, the number of children in Arkansas that would be 
eligible for this credit total 349,625; 349,625 children in Arkansas 
would qualify for this family tax credit, totaling $174,812,000.
  Let me say to the gentleman that when we at the Budget Committee 
presented this at a press conference, we did not have all the specifics 
that day because all the numbers had not been run yet. There is only 12 
of us trying to do this thing.
  The press came to me and said, ``John, if you hadn't done cutting 
spending first last year in the Penny-Kasich budget, and we didn't know 
that you would give us the numbers tomorrow, we wouldn't believe this 
is possible.''
  We have shown them the numbers, and does the gentleman know what they 
say? ``A very serious alternative.''
  The difference between the Republican budget and the Democrat budget 
is the Republican budget says, we do not believe that the Federal 
Government ought to be empowered. We think the Federal Government ought 
to be shrunk.
  Mr. DICKEY. Let me say something to that. In my district, I think 
there is $54 million that is going to be injected into the economy in 
the Fourth District of Arkansas.
  Mr. KASICH. I would say to the gentleman, in the Fourth District of 
Arkansas, which the gentleman represents, there are 107,975 children 
who would be affected and eligible. Their family would be eligible for 
this tax credit, and that amounts to $53,987,500.
  Mr. DICKEY. Let me say something. If the gentleman from Ohio will 
yield for a second, what we in the business world consider as a value 
to the economy is like $1 equals $7, as it circulates and comes back. 
And it is circulated and circulated again.
  If we are looking at $174 million for our State of Arkansas coming 
back so that we spend it without the price of Government bureaucracy, 
without the inefficiency and the ineffectiveness of Government spending 
our money, and we spend our money, we can multiply that times seven, as 
far as what it will do to our economy.
  Then we have more income. We have more income taxes, and we can help 
the economy of Arkansas.
  I am for this program anyway. I have voted every time your bills have 
come up, every time the gentleman from Ohio, every time it has come up. 
But this time in particular, we have a chance of taking back the power 
that is taken from us when we are taxed. We ought to give it to the 
people and let us spent it rather than, in the United States, rather 
than up here in Washington, DC.
  I am particularly for that, because I think we can spend our money 
that we earn a lot better than a Government that does not earn it and 
has nothing, does nothing but waste it.
  Mr. KASICH. I want to compliment the gentleman on his statement. But 
there is always one important point that we need to keep getting 
through.
  The document that I have in my hand is the Republican budget 
alternative. I am flipping through a whole variety of pages. This 
contains every single element of the Government reform that we believe 
has to be made to provide some tax relief to the American family and 
also to reduce the deficit.
  There is no free lunch. There is not some kind of an economic plan 
that is a hope and a prayer. This is a hard-core decisionmaking 
document that says specifically where the Federal Government's power 
can be reduced, where services can be improved to our citizens.
  I want to give you one example about this, to the gentleman from 
Arkansas. I need to make this point. We have got a very valuable member 
of the Budget Committee here with us now, Nick Smith from Michigan. I 
want to talk about a provision, because people have to understand where 
our thinking is. We have taken all the nutrition programs of the 
Federal Government and rather than allowing the bureaucracy, spread out 
in all these different offices to touch the money that the people of 
Arkansas and Michigan and Pennsylvania send here, and then send back to 
us, because you see, as this money makes its way through all these 
bureaucrats' hands, it burns up the value of that money.

                              {time}  1900

  So what we have done is taken all of the nutrition programs of the 
Federal Government and we have put them in a block grant, and we have 
said to the States we are going to send you this money, Arkansas, 
Michigan, Ohio, and you spend it to feed people who need it, with one 
single requirement: Double the amount of money that you give to women, 
infants and children. Do Members know what? In the course of doubling 
the amount of money we give to women, infants and children we are able 
to actually save the Federal Government $8 billion. Do Members know 
why? Because we have eliminated all of the bureaucracy that clutters 
this place and keeps us from being able to deliver the services that 
the American people want.
  And we use that philosophy on job retraining programs where we do not 
think a Washington bureaucracy is going to retrain people as well as 
getting the money back to the States and letting the local people do 
it. We do it under the guidance of the gentleman from Michigan who has 
block granted money, mass transit money, into low priority 
transportation projects.
  What we are trying to do is say that the States are capable of making 
wise decisions. And in the course of doing it, we have saved billions 
upon billions of dollars, and it is wonderful because we take a little 
piece of that and we say to the American people we are not only going 
to save $8 billion off the deficit, but we are going to give you a 
little piece of that money that you have been sending for your family.
  One other comment I would like to make. We privatize. We say that the 
Federal Aviation Administration ought to continue with safety 
inspections in this country, but we want to turn the air traffic 
control operation over to private corporations. This is done all over 
the world. If we are able to do that, then the airlines will have more 
efficient operations. It will benefit the consumer. Now when we get on 
an airplane, did Members ever notice when they back away from the gate 
and sit there half an hour? It is because that is so they are reported 
to have departed on time, but they never get up into the air. Do 
Members know why? Because the air traffic control system is outmoded 
and outdated, and we cannot get an efficient one in place. Do Members 
know how we are going to get it in place? Not in the Federal 
Government. We are going to get it in place with private corporations, 
private enterprise and business.
  We take those savings from that proposal, we apply some of them to 
reducing the deficit, and we take a little piece and we say to the 
American family that they can have a little bit of it.
  All throughout this proposal it is a hardcore choice of downsizing 
and shaking up the Washington establishment, less for Washington, more 
for the people who support this place.
  Mr. DICKEY. Mr. Speaker, will the gentleman yield for a minute?
  Mr. KASICH. I am glad to yield to the gentleman from Arkansas.
  Mr. DICKEY. I still need to ask a question of the gentleman from 
Ohio. As I have looked at these other proposals by the liberals in this 
body, I see that really all we are doing is recycling money, that we 
are not really sending it to the deficit, we are not really cutting 
spending first as the people of the Nation want us to do. What it seems 
like we are doing in that regard from that side of the House is this 
bill, and I know it is, but explain to the American people how this 
bill is not recycling money but it is actually cutting the deficit and 
actually bringing some pain so that we can gain on the deficit?

  Mr. KASICH. There are some choices that have to be made in this bill. 
But what I want to say to the gentleman is if you are creative, if you 
are innovative, if you are not afraid of change, you can make mammoth 
amounts of savings, and you can use that to reduce the deficit, and you 
can use it perhaps to help families or any other choices you want to 
make. And that is precisely what this bill does. Listen. If this was on 
the national referendum, this budget proposal versus the President's 
budget proposal, it would be no contest.
  Mr. DICKEY. Yes, 9 to 1.
  Mr. KASICH. That is exactly right. And what we need is for the 
American people to stand up and say we do not like the Washington 
establishment. We want it changed. We want it fixed. We want to reduce 
the national debt, and how about a little bit for my family.
  Mr. DICKEY. How can we say that we have true spending cuts if it is 
not going to reduce the deficit? That is what I think the people of 
America are impatient with. They are tired of it, and I think we have 
to answer to them.
  Mr. KASICH. Part of the problem is that this administration says they 
are going to cut, but what they do is they cut this program and create 
another government program.
  Mr. DICKEY. Yes; so that they can do more favors, so that they can do 
more favors just in another area.
  Mr. KASICH. It is a different philosophy. They believe investing in 
government is the way to have progress, and we do not happen to share 
that view.
  Mr. Speaker, I yield to the gentleman from Michigan [Mr. Smith].
  Mr. SMITH of Michigan. Mr. Speaker, we talk about some of the tax 
changes and the $500 per tax child tax credit, not a deduction but a 
tax credit for each child in America where their parents file income 
tax. That is a beginning. But let me talk about another tax fairness 
issue.
  How many people are self-employed out there? How many people are 
unfortunate enough that they do not have health care provided by their 
employer, and yet when they go to fill out their income tax, they have 
to pay tax on all of their health care dollars until they exceed 7\1/2\ 
percent of their income? So what happens is the individual that is 
lucky enough to have health care provided by their employer does not 
have to pay any tax on the value of that health care. The person that 
is self-employed, or unlucky enough to be working for a small employer 
or small business and not to have that health care provided, ends up 
paying income tax on it.
  The Kasich plan, this Republican proposal, allows 100 percent 
deductibility for individuals who are self-employed or otherwise do not 
have it furnished by their employer. That is a beginning.
  Let me mention another area of tax changes in this bill. In this 
country we just happen to have less investment by our businesses, by 
out industry. We invest less in new machinery and equipment per worker 
than any other G-7 countries of the world. Why do we do that? Because 
our tax policy at the Federal level makes it more difficult for those 
businesses to invest in new machinery and equipment because we tax the 
heck out of them.
  In a provision in this bill it says, look, we are going to allow 
businesses who are willing to make that investment to try to increase 
their productivity, to expand jobs, we are going to make it easier for 
them to invest that money in new machinery and equipment by applying, 
if you will, an inflation factor on what they are otherwise allowed to 
depreciate.

  Let me go into that just a little bit.
  Mr. DICKEY. This is different than a tax credit? The gentleman is 
talking about a deduction now; is that correct?
  Mr. SMITH of Michigan. I am talking about allowing full depreciation 
for new machinery and equipment that a business buys. Right now we say 
that they have to depreciate that machinery or equipment over a period 
of whatever, 5, 10, 15, 20 or 30 years, but as that time period elapses 
the $1,000 that they invested in the piece of machinery, they are going 
to have to wait 20 years before they are allowed to deduct it as that 
year's portion of that machine as an expense, and the dollar is not 
worth as much any more.
  So what this provision includes would be as a small part of the 
Kasich budget plan saying that we are going to apply an inflation 
factor to what you are otherwise allowed to depreciate. It is going to 
make a difference.
  I would just like to say also to the gentleman from Ohio [Mr. 
Kasich], congratulations for his hard work and good job.
  I would like to also say that the key is to come up closer and closer 
and closer to a balanced budget until we have it. This plan in 1996 has 
a deficit of $140 billion.
  Do Members know the last time we had that small of a deficit in this 
country? It was in 1982 at the beginning of the Reagan era that we had 
something like a $150 billion deficit.
  So everybody's goal, if there are 263 individuals in this body who 
say, hey, I am going to sign the balanced budget amendment and change 
the Constitution, there should at least be 218 who are going to pass a 
bill that comes closer to it, and this bill does it.
  I know it has been said, but we are coming to $150 billion more cuts 
after we pay for all of these tax changes and everything else, $150 
billion more cuts than what the alternative is coming from the 
administration.
  Mr. KASICH. I appreciate the gentleman's contribution. Let me say to 
the gentleman from Michigan [Mr. Smith], who is from the 7th District, 
there are 129,213 children in families that would qualify for this tax 
credit, totaling $64,606,000 that would give the people, the middle 
income folks in Michigan a piece of the downsizing of the Federal 
Government. And I really want to thank the gentleman for his 
contributions on the Budget Committee.
  Mr. Speaker, I yield to the gentleman from Arkansas [Mr. Dickey].
  Mr. DICKEY. Mr. Speaker, I want to stress to the gentleman and all 
other Members in the Chamber as well, are there not people out there in 
America who are saying yes, we want to sacrifice?

                              {time}  1910

  Do you all not hear in your communications with the folks, ``Yes, we 
want to sacrifice, but we want it to be fair''? I think there are 
people who want this to happen as long as we get down to everybody 
sharing. We do not want to put it off on any one person or any one 
section of our economy.
  I also think there are people in this body who do not think there is 
a life after spending cuts. They do not think there is a life after 
sacrifice. The American people say, ``Yes, let us do it.'' Public Enemy 
No. 1 of America is the deficit, and I think our people are ready to go 
to war.
  Mr. KASICH. I will yield to the gentleman from Michigan, but I want 
to let him know in his Second District in Michigan that there are 
139,178 children in families who would qualify for the child tax 
credit, and that would total $69,589,000, just a little piece of the 
savings that we make by shaking up the Washington establishment.
  I yield to the gentleman from Michigan [Mr. Hoekstra].
  Mr. HOEKSTRA. I thank the gentleman for yielding.
  It is on behalf of the people of west Michigan I would like to thank 
the gentleman, because there are a number of things that the gentleman 
has been talking about, I think, that kind of fit together.
  No. 1, the gentleman talked about taking power away from Washington 
and moving it to the people. He talked about an initiative or the 
opportunity, if this were on a referendum basis, the American people 
would endorse this budget by an overwhelming margin. That is one of the 
things I want to accomplish in Washington one of these days is to 
accomplish an initiative or referendum process to have the people have 
more input into the process in Washington and help set the agenda. That 
is not why we are here tonight.
  Mr. KASICH. Let me just say to the gentleman that this is a perfect 
example of how the initiative petition would work, because if the 
American people had the right to vote on this budget versus the 
President's budget, we are winners, and if there is anything we need to 
shake up the Washington establishment, it is to let the people on the 
outside of the wall get over so those in here get the message.
  Mr. HOEKSTRA. Right. If we had the referendum process, we would get 
their input on term limits, and next week we would be able to really 
get their feeling on whether they wanted a balanced-budget amendment.
  But I think what is important and is exciting about this budget is 
the framework that it establishes by bringing people and bringing more 
power back to the people at the local level.
  I think the reason we want to do that is we have to recognize that 
that is where we are going to get the most productivity and the best 
use of our dollars. The individual person, the individual company at a 
local level, they experiment, they learn, they have personal 
responsibility in terms of how they are going to spend their money and 
where they are going to use it.
  Businesses and local communities are much better at creatively using 
the funds that they have at their disposal rather than what we do here 
in Washington. They are more inventive in terms of how they are going 
to use their dollars to solve problems at the local level, at the 
family level, than what we have here in Washington.
  We need to go back to reinforcing the things that have gotten us to 
be a great country, the free market system. We need to shrink what we 
are doing here in Washington.
  I would also like the chairman, or the ranking member, of the 
Committee on the Budget to perhaps answer a question that one of the 
things that I have observed since I have been here in Washington now 
for 14 months is that every time we talk about cutting spending or that 
as we run into a budget problem, we have this habit in Washington of 
saying, Well, rather than passing a new law and spending money in 
Washington to implement, what we are going to do is we are going to 
pass a new law and we are going to tell people what to do at the local 
and what to do at the State level, and we are going to mandate to them 
what we are going to do. So, you know, right now I have got three 
counties in western Michigan that, because of a poorly written law, are 
going to go through auto emission testing because the Federal 
Government has mandated that if the air above you is dirty, you will 
clean it up. The problem is air moves, and the law has no allowance for 
transport of pollutants.
  But what would you say to the person that says, Just a republican 
budget; what they are really going to do is the end result will be they 
pass the costs on through mandates?
  Mr. KASICH. I would say to the gentleman that we are clear here on 
the issue of unfunded mandates. We have provisions in here that we 
think the legislation should be enacted to require the CBO to report on 
the costs imposed by unfunded mandates and on State and local 
governments prior to any action here. We believe there ought to be a 
pay-as-you-go. We do not think we ought to have unfunded mandates.
  In fact, the language we have in our proposal has been really created 
by the gentleman from California [Mr. Condit], the national people in 
the mayors' association, national Governors, the Republican Governors' 
Association. We do not think we ought to be mandating costs on local 
governments.
  I would also say to the gentleman we also believe that the problem of 
regulation on any operation in our society should be restricted.
  So this is not an effort to shift the burden away from Washington to 
local government. It is an effort to say, ``People at home, we think 
you can solve our problems better than a bureaucrat can.'' And, you 
know, it amazes me, I have people who talk to me who work here in 
Washington who say, ``What is the time zone in Columbus, OH?'' And they 
are going to solve our problems back there the people there can best 
solve, and that is the philosophy behind this budget.

  Mr. HOEKSTRA. I think the important thing to realize, this is more 
than just a budget document. It sets some major new courses in terms of 
moving dollars back to the family, cutting Government spending, cutting 
back on mandates, which is another form of Government spending. We just 
do not have the nerve to ask for the taxes; we just tell people what to 
do. So this really does set a new direction and a new tone for what we 
are going to be doing here in Washington.
  I applaud the gentleman on the work that he has done and thank him 
very much for the opportunity.
  Mr. KASICH. I would like now to yield to the very distinguished 
gentleman, a member of the Committee on the Budget, from South 
Carolina, the gentleman from South Carolina [Mr. Inglis]. He is from 
the Fourth District of South Carolina, and in his district, I say to 
the gentleman from South Carolina [Mr. Inglis], there are 120,170 
children who make up families that would qualify for the child tax 
credit, totaling over $60 million, but just a tick of the savings that 
we are trying to provide to reduce the deficit, give a little bit back 
to the families.
  I would be glad to yield to the gentleman, a member of the committee.
  Mr. INGLIS. I thank the gentleman for yielding.
  I want to congratulate you, I say to the gentleman from Ohio [Mr. 
Kasich], on the excellent work he has done to guide us on the 
Republican side of the committee through the process. We have been 
meeting for 6 or 7 months now in working groups to come up with this 
budget, and the very important thing I think to point out is that for 
those in this country who heard the debate last year, they heard about 
our cut-spending-first budget.
  That budget really is part and parcel of this new one. There is sort 
of a new twist this year, though.
  In addition to significant spending cuts, in fact, $150 billion worth 
of additional deficit reduction over what the President would do, this 
year we add some things that I think are very important to add.
  We add a number of things that constitute a growth agenda, and an 
agenda aimed at giving some tax relief to the American family. Those 
are some very important things to add.
  Last year in our budget, I say to the gentleman from Ohio [Mr. 
Kasich], we had $429 billion worth of deficit reduction, as you recall, 
over 5 years. That was a significant package of cuts to get us on the 
way toward deficit reduction.
  We have picked up some of those cuts and brought them into this 
year's proposal. This year's proposal, though, has some exciting new 
things. In addition to all of those cuts from last year, and some new 
ones we have added as we have come up with additional ways to shrink 
the size of this Government and to cut spending first, this year we 
have got a number of exciting things. We have got a crime bill that is 
paid for. We have got a health care reform package that is paid for. We 
have got a family tax credit that will restore the value or move toward 
restoring the value of the exemption that existed long ago for the 
American family so that now we can get some tax relief to the American 
family rather than continue to put the pressure on the family so that 
both spouses must work.
  That is the idea behind this package. And another part of it that is 
a significant part of this growth agenda that I am speaking of is the 
capital gains tax reduction. That, together with the accelerated 
depreciation, should help businesses across this country invest in the 
future in a system where they can see some relief at the end of the tax 
tunnel.

                              {time}  1920

  The important thing I think to point out about all this, though, 
talking about this growth agenda, is that all of it is paid for. I 
think that is the most significant accomplishment, I say to the 
gentleman from Ohio, that I would point out to him as something that he 
has helped us on the Committee on the Budget to come up with; all of it 
is paid for.
  Mr. KASICH. I think the comment the gentleman just made is so 
important. We are not trying to give away for today somebody's savings 
for tomorrow. What we are saying is that when the administration raised 
taxes by nearly $300 billion, we do not want that. We did not want it 
last year, and we are prepared to say where we would reduce spending in 
order to give them this tax relief.
  This is, basically, only canceling out part of the tax increase that 
we had last year. Not only that but, you know, what this does, it 
allows us to keep the President's commitment to middle-income families.
  Do you want to know something else? I think he will be around with a 
proposal that will be very much like this. So, I say why not now? 
Because we have got the way to pay for it. Let us give them the relief 
now.
  You know, when he was Governor, he, along with a whole host of people 
in this body right now, signed onto the fact that they wanted to give 
$1,000 tax credit per family. I do not want to monopolize the time 
here; I just want to thank the gentleman from South Carolina for 
working on creative proposals to downsize the Government so that we can 
not only reduce the deficit but also help American families.
  One other point: The investments we make in allowing the private 
sector to depreciate plant and equipment, you see, that is going to 
improve things here. That is going to create jobs, generate more 
revenue. These are investments in the private sector that will pay off 
for the American people in addition to the family tax credit.
  Mr. INGLIS of South Carolina. Mr. Speaker, I will just add briefly 
here something that I think is very important to point out again. That 
is that all of what we are talking about here in our growth agenda--it 
is important not to have just deficit reduction but also growth--all of 
our growth agenda is paid for by corresponding cuts. In fact, more than 
we were talking about in the growth agenda. So that we actually effect 
significant deficit reduction.
  I think it is important, too, to point out that the deficit reduction 
has two parts to it. It has a revenue side and an expenditure side. The 
key thing to look at particularly with the family tax credit is that it 
affects both sides. Yes, it affects the revenues to the Government, but 
it significantly impacts, I believe, the expenditure side of the 
Government. The fact is, when you look across this land, what you see 
is a deterioration in the American family. That is actually what is 
creating a lot of the expenditures that we do in this body, to take 
care of the fact that the family is falling apart and to try to put it 
back together again with some kind of a social program created and run 
by the Government. The American people know it will not work because 
the family is the basic institution of society. So we are trying to re-
create that system with some other kind of Government-run program; it 
will not work. What we have to do is restore the family by allowing the 
family to keep some of its money. That is the growth part of this 
budget.

  The other part is getting the size of this Government shrunk, which I 
think is the clear message of the American people, shrink the size of 
this Government.
  Mr. KASICH. The gentleman from South Carolina has just made a very, 
very good, a great statement about what we are trying to do in that 
committee. I very much appreciate the gentleman's contributions.
  I now want to yield to the second Member from the State of Arkansas, 
the gentleman from the Third District, Mr. Hutchinson. Mr. Hutchinson 
has 119,447 children who would be eligible in the families for this tax 
credit, $59,723,000. I want to say that Mr. Hutchinson and Mr. Grams 
have been absolutely key to the insertion in this budget of this family 
tax credit. I have enjoyed working with him.
  You know, we kind of look at the Republican Budget Committee as kind 
of a family here; we like to work together, share ideas, we like to be 
constructive together. I want to compliment the gentleman from 
Arkansas, and I look forward to his statement right now.
  Mr. HUTCHINSON. I thank the gentleman, and I want to compliment and 
commend the Committee on the Budget, particularly the gentleman from 
Ohio [Mr. Kasich]. This, I believe, is one of the most remarkable 
budget documents, in fact, a revolutionary document, certainly in the 
last 13 years since 1981. It points the Republican Party in a new 
direction. It not only emphasizes what we did last year in the budget 
with real deficit reduction, but it now provides real, real relief for 
American families as well as a progrowth agenda.
  So I believe that it has sparked interest in the American people, it 
has hit a note among the American people. Phone calls are coming into 
the Capitol, faxes are coming into offices on Capitol Hill saying, 
``Support this pro-family budget.''
  I am very excited about that. It is remarkable for three reasons, for 
sure. It is remarkable because it brings us, first of all, real deficit 
reduction. That in itself, when you look at the numbers and realize 
this budget which provides relief in the area of taxes, also brings us 
greater deficit reduction than the administration's, that in itself is 
remarkable. It is a progrowth agenda with capital gains tax reduction 
as well as other progrowth components to this budget. It will spark an 
economic revival in America.
  So while all of the numbers are based upon a static model, in fact, I 
think we are going to see dynamic growth as a result of this budget. 
That is going to mean the economic picture and Federal revenues will be 
even rosier than we were able to project on a static model.
  The most important development to me and the most encouraging and 
heartening element of this budget is the $500 per child tax credit that 
is offered in a truly family-first kind of budget.
  The family in the last four decades has seen the tax burden increase 
by over 250 percent in the last four decades. In 1948 the average 
American family was spending about 2 percent of their income, their 
gross income, on Federal taxes. Today that is over about 28 percent, an 
incredible increase in the burden that they face. And this antitax--
antifamily tax policy that we have built up over the last four decades 
needs to be reversed.
  In fact, in a number of areas we have actually attacked the American 
family, antifamily in our tax policy. This will be the first major step 
we have taken in reversing that very, very damaging trend.
  As the gentleman from Ohio pointed out, every objective view of the 
American family has said that we need to provide tax relief for the 
American family. The Rockefeller Commission on Children said that we 
need a $1,000 tax credit, not $500. President Clinton, when he was a 
candidate for President, endorsed that concept of providing middle-
class tax relief, he promised that that would be what he would do. Now 
a year later we still do not have it. We are offering him the 
opportunity to really reinforce the American family, fulfill his 
commitment, fulfill his promise and provide this kind of $500 tax 
credit for families with children.
  The question and the choice in this whole budget is one of Big 
Brother or mom and dad. Are we going to vote for Big Brother, or are we 
going to vote for mom and dad and the boys and girls of this country? 
Are we going to vote for more Government, more bureaucracy, or are we 
going to vote for the family? That is the choice that confronts us. I 
do not see anybody could have a hard time with that choice. Do we want 
more bureaucracy, more Government, or do we want to help the family?
  You know, I sometimes greatly resent the way the Republican Party has 
been portrayed, as being only for the rich. I think if there is 
anything that underscores our commitment to the middle class, that 
underscores our commitment to the family, it is the budget document 
that the committee has come forward with.
  I do not care if a family is making $20,000 and has 5 children, they 
are going to find under this budget plan $2,500 of tax relief, real tax 
relief for that low- and middle-income family. This is a real help for 
the American family, paying more for college tuition, more for 
groceries, more for transportation, more for insurance, more for health 
care, all along the line. All we are saying is let us leave the money 
in the pockets of mom and dad and let them make those choices on how 
they can best care for their family.
  Someone said it recently, and I think they said it very well: ``The 
best department of human services in the country is the American 
family. Let us let them do their job, let us not detract from the job 
they are doing by overtaxing them and putting this heavy burden upon 
them.''

                              {time}  1930

  And this budget gives hope to the American family. I think it is a 
truly remarkable and revolutionary document that is exciting the 
American people, and into the next 24 hours we are going to continue to 
hear from them on Capitol Hill and, I hope, our colleagues on both 
sides of the aisle, because the family is not a Democrat, and the 
family is not a Republican. A family is American, and we need both 
sides of the aisle to start a truly profamily, families first, kind of 
budget, and I appreciate the opportunity to make this kind of a 
statement.
  Mr. KASICH. Mr. Speaker, I would say to the gentleman from 
Connecticut [Mr. Shays] who has had an opportunity to listen to our 
colleague, the gentleman from Arkansas [Mr. Hutchinson] that that was a 
very impressive, very well thought out argument that the gentleman just 
made, and I want to compliment him on his statement. I am sure the 
gentleman from Connecticut will do the same, and at this point I yield 
to my dear friend, the very distinguished gentleman from Connecticut 
[Mr. Shays], a member of the Committee on the Budget.
  Mr. SHAYS. Mr. Speaker, I thank the gentleman from Ohio [Mr. Kasich] 
for yielding and also thank the previous gentleman, the gentleman from 
Arkansas [Mr. Hutchinson], for speaking. There is just no question that 
what has been very exciting as a member of the Republican Party is to 
see how all elements within our party have tried to come up with a 
viable alternative.
  I am over on the Democrat side of the aisle, and I am thinking how 
significant a discussion we had last year when we debated the Penny-
Kasich proposal, Republicans and Democrats working together to try to 
cut spending, and how the White House snuffed out that effort, and so 
what my colleagues see today are just Republicans talking.
  I am remembering when the President was first elected and he said, 
``We need to work together, and we need to come up with alternatives.'' 
We came up with alternatives. He said, ``We need to work on a 
bipartisan basis,'' and we reached out to the gentleman from Minnesota 
[Mr. Penny], and we did.
  Mr. Speaker, I went to the White House and met with Leon Panetta to 
ask him to support the Penny-Kasich bill, to say, ``Cut $90 billion,'' 
and, ``It's bipartisan. We have a chance to work together.'' And I 
said, ``At the very least, if the President can't support it, at least 
he won't work against it.'' And what the answer was was a very partisan 
effort to kill this bill, and they succeeded by six votes.
  But I am thinking:
  Six votes. Just three people, it would have been a tie. One more 
vote, four people, it would have passed despite the effort by the 
administration to kill an effort to cut $90 billion.
  So today we are back as Republicans speaking, and I know the public 
wants us to be Americans first, and that is what we have got to be, but 
the sad thing is we do not have people on this side of the aisle 
talking about cutting more, getting our financial house in order, 
talking about the kinds of issues of family tax relief which, I think, 
was a significant element in this package put together by cuts in other 
places, paid for, $500 to help families raise their children. The 
welfare reform that is in our package--I mean getting young women in 
particular back to work, and we have a neat program, a wonderful 
program, in Connecticut where young welfare moms are being coached and 
helped in terms of getting back into the workplace, and my colleagues 
will see their graduation from the private industry groups that have 
been involved, and a welfare recipient will say:
  ``You know what I like best about my program?''
  This is a graduate of basically welfare back in the work stream, and 
more often than not we will have one of the recipients hold up a check, 
and they will say, ``I earned this. I have a job, and I earned this.''
  And that is what we have. We have welfare reform in our package.
  We have significant deficit reduction of over $150 billion. We have 
job creative incentives.
  We have health care reform, and one of the things that was a 
disappointment to me in this whole debate is that in the bill we are 
going to debate tomorrow there is no health care reform. It is not in 
it, and we are going to have to put it in, and then we are going to 
have to find out how we pay for it in the package presented by the 
majority party. But, as the gentleman knows, we have our health care 
reform package, an anticrime package as well.
  The reason why we are doing what we are doing is we need to get our 
financial house in order, and we know we got into this mess because of 
Republicans and Democrats, the White House and Congress. I mean it did 
not just happen because of one party. In some cases it happened because 
both parties were willing to save their own area at the expense of the 
general public that have to pay the bill, going back and saying, 
``Well, I didn't cut defense when we probably needed to,'' and some 
saying, ``I didn't control entitlements when we needed to.''
  So, Mr. Speaker, what we have now is a package that seeks to do all 
of those things, and it would not have happened without the leadership 
of the gentleman from Ohio [Mr. Kasich].
  But I remember last year when the President brought his plan forward, 
and he pointed to the gentleman and said:

       You come up with alternatives. You're the ranking member of 
     the Budget Committee. You come up with alternatives, and I'll 
     look at them.

  And I remember the gentleman being outraged that the President came 
within $3.58 of taxes for $1 in spending cuts, and actually when we say 
``spending cuts'' here, we are talking about cutting the increase in 
spending. And when the Budget Committee came in, the Republicans with 
their alternative, and no tax increase, cutting spending first, to the 
credit of the Democratic Party they responded, moderate and 
conservative members in particular. The Democratic Party said to the 
President, ``We need to cut more,'' and they did, and they got that 
$3.58 of taxes for $1 of spending cut down to $1.53.

  Mr. Speaker, that was an improvement, and I think it happened in part 
because of the responsible actions of the Republicans in showing it 
could match the President's number with no tax increase, but then the 
sad thing is his package passed by one vote here, but, if one had 
changed, it would have been a tie vote, and he promised then that there 
would be an opportunity to cut more. I remember the majority leader 
saying, ``This is just the beginning,'' and the Speaker saying, ``This 
is just the beginning,'' and the Speaker saying, ``This is just the 
beginning; we have to do more.''
  And this year what did we see? Well the end of last year we saw them 
squash Penny-Kasich, a bipartisan effort, but then the President walked 
down the aisle. He came up to the dais and spoke to us in the State of 
the Union. He said, ``We need to stay the course,'' and I am thinking 
this is the President talking change, stay the course. What is staying 
the course? If we do not take action on the national debt in the next 5 
years, it is going up $1.6 trillion. It is only, only a 38-percent 
increase, as the President points out, a less of a percent, but it is 
on a much higher base. The national debt is going to go up $1.6 
trillion, one of the largest increases in any 5-year period under any 
President.
  So, Mr. Speaker, we know we need to cut spending more, and we make 
that effort in a very real way, and what I like about it is in the 
process of making the effort of cutting spending we are not just saying 
no to programs. We are consolidating. We are taking 150 educational job 
training programs the GAO has recently written reports on and saying, 
``They don't work,'' that they are not doing the job they should do, 
that we are wasting tens of billions of dollars. And they are saying to 
consolidate, so we do in our budget. We have 8 programs from 80, and 
that to me is a step in the right direction. We consolidate our grants 
programs for housing and allow States the opportunity to decide where 
to spend this money, and we get rid of a whole layer of bureaucracy. We 
continue to cut back the work force.
  But if we stay the course, as the President has asked us to, spending 
will go up 23.3 percent in the next 5 years, so all we did was, under 
the President's plan last year, cut the slight increase. Spending would 
have gone up 27 percent, and so now it is going up 23 percent. The 
national debt is still going up $1.6 trillion. We cannot stay the 
course, and I am hoping that the next go-around, that instead of a 
Republican on the side of the aisle that there will be Democrats again 
who say that we have to do better and come through because that, I 
think, is the only salvation we have.
  Mr. KASICH. Mr. Speaker, I would say to the gentleman from 
Connecticut [Mr. Shays] that one of the proudest moments of my career 
was working on the Penny-Kasich bill, and I, in fact, just today talked 
to the gentleman from Minnesota, and we talked about windows of 
opportunity in the future, about being able to bring change to this 
town, and I would say to the gentleman that I know that a number of my 
constituents are very frustrated by the fact that they have not seen 
the kind of change that they were promised, and I believe they take 
great hope in the efforts that we make, and, you know what? We are 
getting closer.
  Mr. SHAYS. Yes, we are.
  Mr. KASICH. As the gentleman knows, once in a while we get a little 
frustrated and say, ``You know, what are we going to do? Are we going 
to win?''
  One of our colleagues said to me:

       John, you keep running up that hill. You just keep running 
     up that hill because one of these days you're going to get up 
     on the top of that hill.

  Mr. SHAYS. Mr. Speaker, if the gentleman would yield, I remember when 
I was first elected in 1987. There were already 30 people who supported 
the gentleman's plan, and then it got to be about 60, and then it got 
to about 150. I say to the gentleman:

       I mean you're getting closer, and you're getting closer 
     because you're trying to do what's right, and you got help 
     from Republicans, and I think more and more Democrats are 
     coming to the conclusion that you can't be for a balanced 
     budget amendment but not be willing to cut spending.

                              {time}  1940

  In the process of cutting spending, I have to tell you, Mr. Kasich, 
there are parts in this budget that we put together that I do not like. 
There are a number of parts I do not like. But I cannot vote against an 
entire package because I do not like certain parts of it.
  That is why we are in the mess we are in today. Everybody request 
find a reason to vote no against the package. But if we do that, we are 
going to continue to see ever expanding budget deficits.
  So I am not frustrated, in part because of the good work you have 
done, and in part because of the good work I am seeing on the 
Democratic side of the aisle among some very conscientious Members. I 
really believe our only solution is for us to work on a bipartisan 
basis. I really hope that the White House will see the opportunity and 
seize it, and then I think we will see some big differences.
  Mr. KASICH. I would finish by saying imitation is the highest form of 
flattery. We are starting to be imitated by the folks downtown. Ronald 
Reagan used to have on his desk a plaque that said you can get a heck 
of a lot more done when you do not worry about who gets the credit. And 
I think we are ahead of our time.
  I would say to the gentleman from Connecticut a number of the ideas 
that we have been advancing over the years are finding their way into 
law, and I think a variety of things that are in this package will find 
their way into law. And I will predict to you before the end of this 
President's term, there will be some middle income tax relief. I just 
think it ought to come now, and it ought to be paid for, rather than 
later.
  Mr. Speaker, I look forward to the discussion and debate tomorrow on 
the various resolutions.

                          ____________________