[Congressional Record Volume 140, Number 109 (Tuesday, August 9, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


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

 
                      ENTITLEMENTS AND HEALTH CARE

  Mr. GRAMM. Mr. President, one of the things that I find most 
interesting about serving in the U.S. Senate is that you are often 
struck by an incredible paradox--the right hand of the body often does 
not know what the left hand is doing. We at some times tend to work at 
cross purposes, and I do not think I have seen a clearer example than 
what is happening today regarding the Entitlement Commission report, 
which is being released, and what we are doing on health care.
  Let me explain. I am sure that people saw in this morning's 
Washington Post the large article about the Entitlement Commission 
established by the President to look at the fact that growth of 
entitlements is on the verge of bankrupting the country. In fact, the 
Cochairman of that Commission is quoted in the article as saying, ``We 
are on a course toward national bankruptcy. Now the question today is, 
what are we going to do about it?''
  If you read the article and you read about the tentative information 
that has been put out by this Entitlement Commission, here is what they 
have concluded.
  Under current law, if we do not start a single new program, the 
built-in growth in programs called entitlements--entitlements are 
benefits you get by meeting certain qualifications; Congress does not 
vote annually to appropriate funds for them--within 35 years we would 
have to double all Federal taxes to pay for only those entitlement 
programs that are currently the law of the land.
  Let me say that one more time. What this Entitlement Commission has 
concluded is that, if we do not start a single new program, the 
existing programs that are on the books are producing expenditures that 
are so big, within 35 years we will have to double income taxes and 
every other Federal tax currently on the books simply to pay the bills 
being generated by all the promises we have already made the American 
people.
  I remind my colleagues that in 1950 the average American family with 
two children sent $1 out of every $50 it earned to Washington. Today, 
it sends $1 out of every $4 it earns to Washington.
  This is what the right hand of American Government is doing today. It 
is lamenting the fact that all of these entitlements we have created 
are bankrupting the country and impoverishing the taxpayer, and we have 
to do something about it. In fact, they are talking about cutting 
Social Security benefits.
  Now, what is the left hand doing? The left hand is debating the 
creation of the largest entitlement program in American history. While 
we are debating our inability to pay for the promises we have already 
made the American people and lamenting the fact that in 35 years those 
projects will force a doubling of all existing Federal taxes, we are in 
the process of creating the largest entitlement in the history of the 
country. Under the President's health care plan, within 2 years, even 
if two miracles occur: First, the Government was actually able to run 
the health care system and, second, wage and price controls--which have 
never worked in 5,000 years of recorded history--actually worked, still 
according to the President's own numbers, the new health care plan 
would cost more than Social Security and would be the largest single 
program of the Federal Government. Within 10 years, it would cost $750 
billion a year. Nobody but Ross Perot knows what $1 billion is. But 
$750 billion is half the total level of Government spending today.
  Now my question, Mr. President, is this: If we cannot pay for the 
promises we have already made, how are we going to pay for the new 
promises that we are making in the name of health care reform?
  I am very alarmed that we are in the process of making promises that 
we cannot pay for. We will end up going back and forth between 
bankrupting the Government and rationing health care, and in the end we 
are going to destroy both the greatest economy in the history of the 
world, and we are going to destroy the greatest health care system in 
the history of the world.
  I am very alarmed that every single health care plan has one thing in 
common--and notice, Mr. President that I am not differentiating between 
Republican plans and Democratic plans. They all claim to be paid for 
for the first 5 years, yet they all start a lot of new benefits in the 
fourth and the fifth years.
  So what it means is that in the sixth year when we are outside the 
scope of our budget process, every one of these plans produces whopping 
deficits. Every one of these plans, when you extend them out to 10 
years, is adding to a deficit which, as we know under existing law, is 
already going to be in the $400 billion range.
  So how can it be that here we are in August getting ready to debate 
the creation of the largest new Government spending program in the 
history of mankind during a period that had been scheduled for us to go 
back to our States or to go on vacation? At the same time we are 
getting ready to debate health care, many of our own Members are 
participating in a commission study which is warning the Nation that 
existing programs are bankrupting the country and that we are 
mortgaging our future. What is our response?
  Our response is that we are not staying here to debate what to do to 
prevent taxes from having to double over the next 35 years. We are 
staying here to debate how we can increase Government spending and in 
the process make the whole entitlement problem worse.
  Finally, let me sum up pointing out the big problems with all three 
of the major health care bills that carry the Clinton name. No. 1, they 
are all very, very expensive. The cheapest of the three, the Mitchell 
bill, would provide Government-funded assistance to 110 million 
Americans. Now, for those 110 million Americans, that Government 
assistance, obviously, is going to be welcomed. But for the other 130 
million Americans who are going to pay for it, it is not going to be 
welcomed.
  The President said the other night at his partisan challenge to ask 
Republicans if they were willing to give people health care. Mr. 
President, we cannot give people anything. The Senate cannot give 
people things. When someone gets something for nothing from the Federal 
Government that means some poor taxpayer got nothing for something.
  More often, it means that some child yet unborn has had its future 
mortgaged to pay for benefits that we are giving away. We do not have 
courage enough, No. 1, to tell the American people what these benefits 
cost and, No. 2, to pay for them.
  I am deeply worried, whether it is the original Clinton plan, the 
Clinton-Gephardt plan, or the Clinton-Mitchell plan, that no one has 
figured out how to pay the cost for any of these plans. They all 
establish a mechanism that ultimately collectivizes decisionmaking and 
health care. Some of them do it directly by forcing you to buy health 
care through a Government cooperative; others do it indirectly.
  Under the Mitchell plan, if you have a health insurance policy--let 
us just take somebody who works for General Motors. The average 
employee of General Motors has a health insurance policy that costs 
about $6,000 a year. Under the Mitchell plan, the Government will 
define what kind of health insurance you ought to have, called the 
standard benefit package.
  If Government says that the standard benefit package should cost 
$4,000, the employees of General Motors will then have to pay a tax on 
the $2,000 of additional benefits that they have negotiated, that they 
want for their families, and that represents part of their wage 
package. So General Motors would then have to pay a 35-percent tax on 
this $2,000 of benefits.
  The recipient of these health care benefits, because the Government 
says they are excessive, would have to pay income taxes on them, but 
there would be a differential based on whether the individual was a 
member of a union or not a member of a union. If a person was a member 
of a union, the company would not have to pay the tax, and the employee 
would not have to pay the tax. But if they were not a member of the 
union, the company would have to pay the tax and the employee would 
have to pay the tax. And if they were in the 31-percent tax bracket, 
there would be a 66-percent tax on those benefits.
  Mr. President, that is not freedom of choice. That tax policy 
destroys people's right to choose. Should people not be able to decide 
what kind of private health insurance they want? Is that not what 
living in a free country is about? I believe it is.
  I thank the Chair.
  Mr. JEFFORDS addressed the Chair.
  The PRESIDENT pro tempore. The Senator from Vermont.

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