[Congressional Record Volume 140, Number 134 (Thursday, September 22, 1994)] [House] [Page H] From the Congressional Record Online through the Government Printing Office [www.gpo.gov] [Congressional Record: September 22, 1994] From the Congressional Record Online via GPO Access [wais.access.gpo.gov] {time} 1720 THE CAPITOL STEPS CONTRACT AND CYNICISM IN WASHINGTON, DC The SPEAKER pro tempore (Mr. Bishop). Under the Speaker's announced policy of February 11, 1994, and June 10, 1994, the gentleman from Georgia [Mr. Gingrich] is recognized for 60 minutes as the designee of the minority leader. Mr. GINGRICH. Mr. Speaker, I think at the beginning I want to talk tonight about the Capitol steps contract and cynicism in Washington, DC. I was very sad that I could not be here this morning when some of my colleagues on the Democratic side did 1-minute speeches attacking our proposed contract for next Tuesday. I want to talk about cynicism and negativism and what is happening in America, and what we are trying to accomplish, and the framework within which we are trying to accomplish it. Next Tuesday, September 27, we will have over 300 candidates for Congress from all over America coming to the Capitol steps to pledge a checklist and a contract. We have a basic document that says, ``A campaign promise is one thing, a signed contract is quite another.'' Then what it outlines, in what will later on be a full page ad in TV Guide, is a basic set of commitments for the opening day, our checklist, and then a contract to bring 10 bills to the House floor and get them to a final passage vote in the first 100 days. Mr. Speaker, I think what I am sad about about the things the White House has done so far to try to attack the contract, and the tone in some of the press coverage and the 1-minute speeches here by the Democrats today, is that I think they miss the whole point of what we are doing. There is not a word in this ad that talks about the Democrats. There is not a word in this ad that talks about the Clinton administration. What this ad does is, it talks in a positive way about what Republicans would do to solve real problems. I'm going to read the ad, and then I'm going to explain the background of why we are doing this, and how we got to this. The ad starts, as I said a minute ago, with a cover which says: ``A campaign promise is one thing, a signed contract is quite another.'' That is why Republican House candidates have pledged in writing to vote on these 10 commonsense reforms. Then it says: GOP contract with America: We have listened to what you want and we hear you loud and clear. On the first day of Congress a Republican House will force Congress to live under the same laws as every other American. Cut one out of every three congressional committee staffers. Cut the congressional budget. Then in the first 100 days we will vote on the following 10 bills: One, balanced budget amendment and line-item veto. It is time to force the government to live within its means and to restore accountability to the budget in Washington. Two, stop violent criminals. Let us get tough with an effective, believable, and timely death penalty for violent offenders. Let us also reduce crime by building more prisons, making sentences longer, and putting more police on the streets. Three, welfare reform. The government should encourage people to work, not to have children out of wedlock. Four, protect our kids. We must strengthen families by giving parents greater control over education, enforcing child support payments, and getting tough on child pornography. Five, tax cuts for families. Let us make it easier to achieve the American dream, save money, buy a home, and send the kids to college. Six, strong national defense. We need to ensure a strong national defense by restoring the essential parts of our national security funding. Seven, raise the senior citizens' earning limit. We can put an end to government age discrimination that discourages seniors from working if they choose. Eight, roll back government regulations. Let us slash regulations that strangle small business and let us make it easier for people to invest in order to crate jobs and increase wages. Nine, commonsense legal reform. We can finally stop excessive legal claims, frivolous lawsuits, and overzealous lawyers. Ten, congressional term limits. Let us replace career politicians with citizen legislators. After all, politics should not be a lifetime job. My point is, here are three reforms for the opening day that are our checklist of what we will do. Here are 10 specific bills that we are committed to bring to a vote in the first 100 days. There is not a negative word here about the Democratic Party. There is not a negative word here about President Clinton and his administration. It is an effort on our part to be positive. You might say, why are we being positive about this? I think that there are two very profound reasons why it would be good to have a positive campaign in October 1994, rather than a negative campaign. The first reason is that people are so frustrated, people are so hostile, people are so angry, that you do not need to go out and get them madder. You don't have to go out and beat up on President Clinton or beat up on the Congress. People get it. They are already fed up. What people want to know, I think, is what are you going to do differently? Our challenge to the Democrats is if they do not like our 10 bills, what are theirs? If they do not like our three reforms, what are theirs? Let us have a debate between ideas, but let us not have the kind of negative smear tactics that have driven the country, I think, to distraction, and have broken down any willingness to have a decent political debate. We are prepared to debate on the issues: Is it a good idea to have a balanced budget amendment, a line-item veto, or not? Is it a good idea to have an effective, believable, and timely death penalty for violent offenders, or not? Should we encourage work and family in the welfare system, or not? These are real policy proposals. We are going to have next Tuesday a whole set of bills. All 10 bills are already going to be written and available. There is a second reason, I would argue, why it would be good to actually try to have a debate in October on the issues. I think this country is in trouble. People have talked about the economic recovery and all this stuff. Nonsense. The underlying core pattern of where America is at is real trouble. If you do not believe me, watch any major city local television news, including Washington, for 2 nights. The child abuse, the rape, the murders, the cocaine dealing, the problems of American life are unbelievable. I am a history teacher, and I tell every audience that as a matter of history, not politics, as a matter of history, it is impossible to maintain American civilization with 12-year-olds having babies, 15-year-olds killing each other, 17-year-olds dying of AIDS, and 18-year-olds getting diplomas they cannot read. I don't think that is debatable. I think it is clear. Yet, every single thing I just described is happening within a mile of your national Capitol. It is happening in every major city in the country. It is happening in West Virginia. It is happening on most Indian reservations. It is an objective fact, if you are going to be honest about it, that we are in the middle of the largest moral and societal crisis we have had maybe in the coutnry's history. The result has been a breakdown in trust in government. I think there are very deep reasons we are in trouble. I do not think what we are going to do in the first 100 days by itself is going to get us out of trouble. I think even if we pass all 10 of these bills--and frankly, I don't know that we can pass all 10. Notice, our commitment is to get them to a final passage vote, to bring them to the floor in the first 100 days and to get a yes or no vote, so that you will know who to keep and who to fire in 1996. But if we are a majority, we may only be a majority of 5 or 10 votes. So when you start listing all these controversial ideas, we are going to have real opposition. There are going to be some real fights. Even if we could pass every one of these, all they would be is the beginning. The purpose of next Tuesday, with all the Republican candidates on the Capitol steps, is to outline the beginning. It is the first 100 days. Remember, the Congress is elected for 731 days, so the Congress has time to really be involved in more than just one set of ideas. {time} 1730 Our goal would be to work very hard on these, to start on the opening day, and then to be in a position to get the final vote done before the 100 days is up; having kept our contract, to then take frankly a couple of weeks off, because we are going to be pretty tired. If we get all this done in the first 100 days, we will have earned a couple of weeks to go back home, to talk to folks, to unwind over Easter, and then come back in early May and have a second Capitol steps event outlining a second wave of reforms. I say that because, for example, it is pretty clear we are not going to pass a major health bill this year. I understand that Senator Mitchell is still trying in some secret meetings over in the other body, but I do not think it is going to happen. So we need to take health reform back up in January, but if the Republicans are in charge, we are going to start with medical savings accounts, we are going to start with home health care, we are going to start with ensuring that every person who is self-employed can get a tax deduction for their own health insurance, we are going to start with lifting the antitrust for hospitals so that they can work together in sharing very, very expensive equipment and developing specialties to deal with cancer and heart disease and things like that. We want to approach it very, very differently than the way the Clinton administration did. But health care is not going to be in the first 100 days, because we cannot guarantee that we can write an intelligent, problem-solving bill in the first 100 days. So that is one issue. The second issue that we are going to work on is voluntary school prayer. I have made a commitment and I will make a speech in the near future outlining why I believe it is so important, that we are going to offer an amendment on voluntary school prayer, making it possible, by the end of June. But I would like to see us have 3 or 4 months to go out and have the Judiciary Subcommittee hold hearings in every State in the country so that in every State in the country, people who favor voluntary school prayer and people who are opposed to it have an opportunity, without having to travel to Washington, in their own State to go to hearings and to express themselves, because I think this is an issue that has tremendous support in the country but is controversial and deserves to be heard. There are a lot of other good, small things we are going to be doing. One small thing we are going to do quite frankly is we are going to change the House rules so that when in the future we file a conference report, we also file the floppy disk so that it is available by computer at the minute you see it on C-SPAN. This is actually our briefing book on Contract with America for next Tuesday, it is pretty big. But let us say this was a bill. Nowadays what happens is, and this happened on the crime bill. The manager of the crime bill came in at 7 at night after we were done voting. He said, ``I now move to file the conference report,'' at 7 at night. It was all written on paper. It was, I believe, about 700 pages long if I remember correctly. It came down here. At 8 the very same night, they were up in the Committee on Rules, nobody had yet had a chance to even look at it. They hoped to bring the bill to the floor the next day and actually pass it. That meant that if you had been at home at 7 at night and you had seen them file the report, even if you called your Congressman or your Senator the next morning, they could never have mailed you the bill in time for you to read it before the vote. One minor but real change we are going to have is that when we file the conference report, if the Republicans are in charge, we are also going to make it available electronically at that moment, so if you are sitting at home or you are in your office or you are at the local public library and you see the conference report being filed on C-SPAN, at that moment you will be able to access Internet and pull up the legislative library and get on your screen and in your computer the entire bill instantaneously. What that is going to do is going to give ideas back out to the country and give the country a chance, notice again, in a positive way, with a positive reform, doing something positive to try to improve the relationship between Congress and the American people. I would like to yield to the gentleman from New Jersey [Mr. Saxton], my good friend. Mr. SAXTON. I thank the gentleman for yielding. Mr. Speaker, first of all, let me commend the gentleman for taking this time this evening to discuss what I believe is the biggest single change to be proposed in the size, scope, and direction of the Federal Government since the 1930's. We as Republicans have recognized that in order to get the size of Government under control, in order to put in place policy that will help our economy grow at historically acceptable rates, which it is not currently doing, that there are some very basic changes that we have proposed under the gentleman's leadership and under the leadership of the gentleman from Texas [Mr. Armey] which will put in place policies over the long term to do a lot of the things that Republicans have been talking about for many years. One of the things that I find very appealing about the way this has turned out is that we know, for example, that when taxes get too high and place too much of a burden on workers and on business that the economy has a very difficult time performing at historic standards. As a result of that, we know that during the late 1970's, the economy did very poorly, and again during the early part of the 1990's after the tax increase of 1990 and the tax increase again in 1993, that we were unable to see the kind of growth again that we would like to see in jobs and in economic growth generally. I was asked to be a leader of 1 of the 11 groups that was to make recommendations. Recommendations that we made, I believe, will be very significant in terms of changing tax policy, in regulatory policy, to help businesses grow, to make jobs more plentiful for workers, to increase wages for workers across-the-board, and at the same time to help families have an easier time of paying their taxes and making a living. Of course there are some here in the House who would not like to talk about these and so there has been an attempt already, even before our September 27 Capitol steps event, there has been an attempt already to change the debate, to tell America that we cannot afford to make the changes that we want to make in order to help the economy grow. There has been a claim that it is too expensive, that we cannot pay for it, and as a matter of fact we have looked at this very carefully under the leadership of the gentleman from Georgia [Mr. Gingrich] and others and we recognize that as we count here in Washington at least, and we do not always count in Washington the way normal people count, but that as we count here in Washington, there is a $147 billion, 5-year cost to this program. I want the gentleman to know that we have looked very carefully and want everyone who is listening to know that we have looked very carefully at this cost and we will pay the bill for this cost in terms of the rules that exist in the House today. We will do it by making cuts in the size of Government. One of the things that the American people may have forgotten about and I know some of the Members of this House would like to forget about is that we have already demonstrated our ability to make those kinds of cuts. In the fiscal year budget for 1994, under the leadership of the gentleman from Ohio [Mr. Kasich] and others, we showed that we could bring a bill to this House that actually cut $369 billion over 5 years. Then gain in fiscal year 1995, the House Republican budget that we had right here on this floor up for a vote where every Republican voted for it would have cut $377 billion. So those who are out there trying to change this debate to deflect attention away from the very good policies that are contained in this contract with the American people need to realize that we have already in the past on several occasions shown that we on this side of the aisle are willing to put our names on the line and make the kinds of very difficult decisions that are necessary to get our country back on the right track. I just wanted to point those things out for the record. Mr. GINGRICH. Because of your work on the Joint Economic Committee, I know you have paid a great deal of attention to economic policy. Being from New Jersey, you are actually living through the demonstration of what we are talking about. As I understand it, when Christie Whitman was running for Governor, she said, ``I believe we can cut taxes and I believe we can cut spending.'' The newspapers attacked her and the columnists attacked her and Governor Florio attacked her. She said, ``No, we're going to do it.'' Then as I understand it when she was inaugurated, she said, ``We are going to keep our word,'' and I believe she has actually cut spending and cut taxes. But could you share with viewers from across America and with our colleagues the story of what is happening for real in New Jersey and why we are confident that if we apply the same principles as Governor Whitman, that we can move in the right direction? Mr. SAXTON. Governor Whitman has done a couple of things. First, you are absolutely correct. During the campaign the Governor pledged to cut taxes by approximately 25 percent over 3 years. She did so, in a way that would help the New Jersey economy grow. I might point out that in the most recent month's statistics, New Jersey had the biggest drop in unemployment of any State in the country. {time} 1740 Mr. GINGRICH. So she actually has cut spending, cut taxes and lowered unemployment by creating more jobs for the private sector? Mr. SAXTON. That is correct. Mr. GINGRICH. That is the opposite, is it not, of the liberal model? Mr. SAXTON. That is exactly opposite of the liberal model. And what she said during the campaign and ended up doing, it was very good to have been able to sit behind her on the stage the day she was inaugurated, and she said if the Democrats in Washington can increase your taxes retroactively, which Bill Clinton and the Democrats did in this House in 1993, she said I can decrease your taxes retroactively and she put in the first tax cut retroactive to January 1, 1992. It was a 5 percent reduction. So what has happened in New Jersey is, number one, we have put in place business jobs, economic growth policy that is working. That is No. 1. No. 2, she did something that is equally important and that the Contract for America is modeled after. That is to restore confidence in government. This lady, our Governor, Governor Whitman, said during the campaign, ``Here's what I am going to do. I am going to cut spending and I am going to cut taxes. We're going to make government smaller.'' And in her first year she made the first installment on that. I might add, you know we do not talk a lot on the floor here about politics, but I might add that the voters in New Jersey, the citizens of New Jersey appreciate that because her approval ratings are over 70 percent today. Mr. GINGRICH. Let me build on that for a second. You have Governor Whitman who won an election and is very popular because she is keeping her word. Then to the south is Gov. George Allen. He gave his word on crime and spending and he is keeping his word. Then in Massachusetts there is Gov. Bill Weld who came in, and they had to get a balanced budget. He said he will not raise taxes and cut spending, and as a result Massachusetts is now creating jobs. In Michigan, Gov. John Engler got elected and said, ``I am going to reform the welfare system and I am going to change the welfare system and break up the bureaucracy.'' He has now done a tremendous job. Over in Wisconsin, Gov. Tommy Thompson, who invented Learn Fair, for example, who said, ``You don't get money if you're not getting educated, we are not giving people money to sit around and watch soap operas,'' and he has really begun to change government. And then Carroll Campbell just finishing his term has a similar tradition. And I must say that I was with Gov. Pete Wilson in California last night, and he has cut spending dramatically in California. When you look at the people who are prepared to be serious about it, as you pointed out, with John Kasich's leadership as head of the Budget Committee, the House Republicans produced a budget that cut over 5 years $400 billion. They came back and produced other proposals for cutting spending. But the first point to be made is about the spending side, that we have proven again and again we can offer a budget that in fact cuts spending. But there is a deeper point I think, and I find it fascinating in the news media some very phony numbers that the Clinton administration has sent up and in some comments made here on the House floor they have come up with a term ``a trillion dollars.'' I do not know if the gentleman is aware of this yet. The way they get to our program costing a trillion dollars is simply they say if you require a balanced budget, since we are going to be borrowing $750 billion under the Clinton plan, your plan is off by $750 billion. So they are in effect giving up on a balanced budget. The Clinton administration is saying that they will never balance the budget, and they are challenging our effort to pass a constitutional amendment. I do not think that either Mr. Saxton or I or anybody else who is on the Republican side thinks you can get to a balanced budget overnight. This is like a giant company. It takes a while to downsize and rethink and reshape. But I think that if we really put our shoulders to the wheel we can do great work. Was the gentleman working on the economic opportunity and regulatory reform section? Mr. SAXTON. Yes, that is correct. Mr. GINGRICH. And you produced as our eighth item in the contract the Job Creation and Wage Enhancement Act? Mr. SAXTON. That is correct. Mr. GINGRICH. I want our colleagues to know this is a list of what is in the bill, so this is substance. In our outline on the Contract With America Briefing Book this runs for 2\1/2\ pages. Here is the outline: Capital gains tax cut, neutral cost recovery, taxpayer empowerment to reduce the deficit and debt buydown, risk assessment cost/benefit analysis, regulatory budget, unfunded mandate reforms, strengthen Paperwork Reduction Act, compensation for private property takings, regulatory impact analysis. Now just in the bill that the gentleman chaired and was so active on you have here a tremendous liberating effect on the American economy. Mr. SAXTON. In just the first instance when we talked about the capital gains tax, which I think is very important, and incidentally, we got a roomful of people who are experts on economic growth, and people, I might add, from both ends of the spectrum because we wanted to get a full picture of what it was that we needed to do to make the economy grow. We asked what is the single most important thing we can do to produce the right action for economic growth in our country, and the broad consensus was the single most important thing that we can do, along with regulatory reform, and along with marginal tax rates, was the change in the capital gains tax rate. And we wanted to be very careful of that. So we got to Bill Archer, who is the ranking Republican on the Ways and Means Committee, and we said how do we do this to be fair to everybody, how do we do this so that we do not face the argument of trying to do favors for business people, often times who are viewed as, particularly by the other party as being rich people? How do we get away from doing the rich people in this country a big favor? So this bill is structured by Bill Archer in such a way that people who are in the lower brackets get a more significant break than people who are in the higher brackets, even on a capital gains tax rate as well as, of course, the indexing. So on that one item we expect very important, big things to happen. You mentioned the neutral cost recovery, which is a fancy word for saying giving people a good break on how to depreciate equipment they buy for their businesses, and while these are not common, everyday things that we talk about around the dinner table at night, at least not most of us, we know from our experience in having watched what happened to changes in the Tax Code that took place in 1986, 1990, and 1993, and watching the performance of the Government, that these are the things that need to be addressed. Mr. GINGRICH. Let me build on that a second. If you will look at the neutral cost, again, for people who are not in business, what this means is when a business buys a computer, or when a business buys a new factory that they actually get to depreciate and write off on their taxes a full 100 percent of the purchase price value. A recent analysis, and this will tell you a little bit about why we are in the fight with the liberal Democrats over how to score this and how much it would cost, a recent analysis by the Institute for Policy Innovation found that the proposal would create 2.7 million jobs, produce an additional $3.5 trillion in economic activity by the year 2000, increase the U.S. gross domestic product by $1 trillion annually, and increase economic activity by 1.8 percent. In other words, if you look at the study done by the Institute for Policy Innovation, 2.7 million more Americans would be at work in the year 2000, the U.S. gross domestic product, that is our national economy would be $1 trillion bigger. To us, a simple shorthand, we collect on the average 19 percent of the gross national product. So by allowing businesses to buy the newest equipment, the newest computers, by allowing them to compete with Germany, Japan, and China, by making sure Americans have the most modern equipment in the world, we would actually increase tax collection by $190 billion a year by the year 2000. Not a penny of that, not a penny of that will be counted by the liberal Democrats in the way they score this bill. So when you read the Clinton administration's nonsense scoring, which is pure socialism, and when you hear Democrats come to the floor and start whining about the scoring and how we are going to spend money, remember, they do not take into account any investment, they do not take into account any new jobs, they do not take into account how the free enterprise system works. And we believe just on that one provision that if you were to look over the next 6 years you would actually probably have several hundred billion dollars in additional tax revenue, because more people would be at work, they would not be drawing welfare and unemployment, they would be paying income taxes. And with more people at work, with a higher salary paying more taxes, you actually increase the tax revenue without having to increase the taxes. I am glad to yield to my friend from New Jersey. Mr. SAXTON. This is a very excellent point the gentleman brings up, because it would seem to the average person, I thought, I always thought until I began to study economics, that when you reduce tax rates the natural effect would be to get less government revenue. {time} 1750 We know today that that is not always true, and the best example, or the two examples of that are, one was back in the time of Jack Kennedy when Jack Kennedy put in place his, or when Congress did unfortunately after Jack Kennedy's death, the economy began to grow after the Kennedy tax cuts were put in place, and as the economy grew, jobs were created, people were bringing home bigger paychecks, and as a result, they sent more money off to Washington because there was a bigger pie to get a smaller slice of, and it produced more revenue. The other good example was in the early 1980's when Ronald Reagan ran for office. He said, ``I know what is the matter with this economy that we call stagflation and malaise,'' and all of those things that we heard back then; he said, ``Taxes have gotten too high.'' So when Reagan ran for office in 1980, he promised the American people he was going to cut taxes by 30 percent. Again, just like the Governor Whitman we talked about a few minutes ago, a lot of people said, ``Ronald Reagan cannot do that.'' In 1981, 1982, 1983, we all know what happened. We had that 30-percent cut over 3 years of the tax rate, and bingo, the economy began to grow again. As a matter of fact, the gentleman was talking about growth in revenue when taxes are reduced. In 1980 our total revenue in our country was about $500 billion. By the end of the decade, in spite of the tax cut, our revenue had doubled. We had over a trillion dollars to spend through this Congress. The gentleman's point is very well taken. When we have to score things around here that do not take into consideration that economic growth produces more jobs, more income, and more revenue to the Federal Government, it is a false way of figuring out the net result of tax policy. Mr. GINGRICH. Let me make another point. This is not just about taxes. We have a contract for 10 items of legislation, and we have a checklist for some very important reforms. Let me make one more point before I yield to my very good friend from Connecticut. In the work the gentleman from New Jersey [Mr. Saxton] has done on the Job Creation and Wage Enhancement Act, in the analysis they point out, and I quote, ``The Clean Air Act expressly forbids agencies from weighing economic effects in writing their implementing regulations.'' Now, let me tell my colleagues what this means, because this is going to be a real crisis for the State of California by next spring. The Environmental Protection Agency is currently writing a master plan for air quality in California which currently, and it will be announced February 1, after the election, but the best evidence we have so far is that it is going to say to long-distance trucks, ``You can only make one stop in the entire State.'' It is going to say to ships, ``You cannot go into Long Beach or Los Angeles harbor if you have boilers that are still hot.'' And since seagoing ships do not turn their boilers off, that means no one will come in. Apparently a group of bureaucrats have sat down in a room and written the perfect Clean Air Act for an agricultural society with no trucks, no cars, no airplanes, and no ships. But it is madness. What we are saying is when you write regulations, you are going to have to look at what do they cost. You are going to have to do an economic benefit analysis, and you are going to have to assess the real risks. You are going to have to actually bring science to bear and not just the latest Ralph Nader press release. My guess is there are hundreds of billions of dollars in savings and millions of jobs that will be saved by the 21st century, 6 years from now, by these two items. Yet when you first read them, they do not seem so powerful. But when you look at the number of job-killing regulations now coming out of the Government, you begin to realize why this kind of legislation is so vital. Mr. Speaker, I yield to my friend, the gentleman from Connecticut. Mr. SHAYS. I was listening to what both of you were saying on the floor in my office, and I just felt compelled to come over and make a few comments. I mean, I just relish the thought that on the first day that a Republican majority is in charge that we would force Congress to live under the same laws as every other American and cut the number of congressional committees and our budget and then move forward in the first 100 days with some very important elements. As someone who has been in public life for a number of years, the one thing that is eminently clear to me, as you have pointed out, I say to the gentleman from Georgia [Mr. Gingrich], that 12-year-olds having babies and 14-year-olds selling drugs, 15-year-olds who are killing each other, and 18-year-olds who cannot read their diplomas is truly the legacy of the welfare state. Candidly, Congress, Republicans and Democrats, know the welfare state is dead. There just is a sense of how do we move forward. For me, it is extraordinarily exciting to think that as a Member of Congress that I can deal with the issues that we have left in this agenda that is a contract with the American people to provide a balanced-budget amendment and a line-item veto. I mean, I think of the extraordinary opportunity a line-item veto would provide and to truly move forward even more of getting tough with criminals, welfare reform, which we have talked about for 2 years and not taken any action, strengthening our families. I know; I have a family of four boys. I know my parents basically had the deductibility of about $8,000 per child in today's dollars, and yet that is not available to families today. What is exciting for me as a member of the Committee on the Budget is to be part of 13 Republicans who came in with alternative budgets last year and this year because of your urging. I mean, one of the things that has happened in this general assembly, in this Congress, is that we have been empowered to move forward in such a meaningful way. Our Committee on the Budget is coming up with reforms, recommendations, welfare reform, health care reform. It is really sad that President Clinton did not put away his veto pen earlier. It is sad the partisan political rhetoric did not stop earlier and we could not deal with some of the incremental needs of dealing with administrative costs and tort reform in our package. As a rank-and-file Republican, I am going to be one of those 300 who is going to sign on to have some commonsense legal reform, and I have an ability through these 10 items to make it very clear to my constituents that where I might disagree on the last item of term limits, because I happen to think that term limits is not the problem. I think the problem is 40 years of one-party control; the American people deserve to see that debated. And here we are having an open dialog after hours, but when there is a debate on the bill, we have closed rules, and to know those rules will not be closed and there will be true debate, I look forward as a Member of one of 435 Members if I am reelected to have a debate on term limits. I might make an argument that says, you know, 40 years of one-party control is the problem and not the fact that someone has been 6 or 8 or 10 years. But it is exciting, and I just heard some comments today about, you know, criticism of this package, and I just want to weigh in as one Member, a moderate Member in this caucus, and to me every one of these issues is right on target in terms of the opportunity for the Americans to see what can happen in the first 100 days. Mr. GINGRICH. Let me give our colleagues an example. On our contract of 10 bills that we will bring to the floor and get to a final passage vote on the first 100 days, No. 9 is commonsense legal reforms. It is, in fact, called the Common Sense Legal Reforms Act. I think the gentleman from Minnesota [Mr. Ramstad] was the leader of this particular project. All of these, I should tell my colleagues, were developed under the leadership, or with the leadership, of the gentleman from Texas [Mr. Armey], the House Republican Conference chairman, with tremendous help from the gentleman from Illinois [Mr. Hyde], who had several policy forums as the head of the Policy Committee, and I think with enthusiastic support from the gentleman from Illinois [Mr. Michel], who had seen over the years the need to move to a much more positive and proactive kind of approach. No. 9 on our list of 10 bills is the Common Sense Legal Reforms Act. It includes discouraging wasteful litigation, honesty in evidence, reasonable limits in punitive damages, truth in attorneys' fees, a legislative checklist, and proportional liability. I am going to take right out of the contract with America's Briefing Book, which is really a tremendous work that has been put together to explain the whole thing, what they say about it, because I think it will give our colleagues a sense of why on the Republican side we are ready to have a positive campaign this fall. We are ready to go out to the country and talk about ideas and about solutions and about real positive things and why I was so discouraged today by the four or five negative and mean-spirited 1-minutes that just did not get it. They did not understand what we are trying to do here. If you will notice this, when we go through this, I think you are going to see it does not attack the Democrats. It does not attack the Clinton administration. It talks about a real solution. Here is what it says on commonsense legal reforms: Our legal system has become burdened with excessive costs and long delays and no longer serves to expedite justice or insure fair results. Instead, overuse and abuse of the legal system impose tremendous costs upon American society. It has been estimated that each year the U.S. spends an estimated $300 billion as an indirect cost of the civil justice system. These billions of dollars result from dramatic expansions in the number of cases filed, a tripling of cases in the Federal courts alone in the last 30 years. In fact, in 1989 alone, 18 million civil lawsuits were filed in State and Federal courts, amounting to one lawsuit for every 10 adults. Enough is enough. Although the vast majority of these cases are filed in state courts, federal reforms can have a substantial impact and provide a model for state reform, without having reform dictated to the state by Washington, D.C. The Common Sense Legal Reforms Act provides concrete steps to restore the efficiency and fairness of our federal civil justice system by: Discouraging Wasteful Litigation. One of the most effective ways to ensure that nuisance, or frivolous, lawsuits are not filed (or that a frivolous defense is not offered) is to require that the loser of a lawsuit pay the winner for the legal fees incurred. The loser pays approach encourages careful consideration of the merits of one's case and the exploration of a settlement prior to filing a suit. This fee shifting provision would be limited to federal diversity cases to ensure that litigants seeking to enforce federal civil rights are not affected adversely. Along the same lines, many lawsuits could be avoided if the parties would just sit down and discuss their differences before going to court. To achieve this first common sense step, the bill requires claimants to notify the other party prior to filing suit, thus encouraging settlements before resorting to litigation. Honesty in evidence. The last decade has witnessed an explosion of abusive practices using rent-an-expert-witnesses and unsupported scientific theories. The bill prevents the use of junk science by requiring expert testimony to be based on sound scientific theories and bars contingency fees for expert witnesses and permit greater review of experts' qualifications. Reasonable limits on punitive damages. It is news to no one that juries have been winging out of control over the past decade in awarding punitive damages to sympathetic plaintiffs far in excess of what is recovered to make them whole. Part of the blame is to rest on the system, because it gives juries very little guidance with which to make such awards. The Common Sense bill provides these standards by requiring that awards be based on ``clear and convincing'' evidence of malicious conduct and be limited to three times compensatory damages. Truth in attorneys' fees. Attorneys often operate under a billing arrangement, called a contingency fee, that is based on a percentage of the damages recovered. While this fee arrangement helps some worthy claimants have access to the courts, it also creates a situation ripe for abuse by attorneys. To prevent abuse, one way to secure the benefits of contingency fees while protecting unsuspecting plaintiffs is to require attorneys to disclose up front the exact terms of a billing arrangement, document the actual time spent on the case, and allow a client who believes he has been misled to petition the court for redress. Legislative checklist. The vague and incomplete laws Congress passes today encourage litigation to determine exactly what Congress meant when it spoke in a particular bill. This provision mandates that Congress follow a simple checklist to ensure that new legislation make clear exactly what is intended, such as whether the new law includes a private right of action, a statute of limitation, or is to be applied retroactively. Proportionate liability. Under today's liability standards, litigants can go after the deep pocket defendants for the full amount of damages even though this party was responsible for a small fraction of the harm. This standard encourages abusive practices of shake down the deep pockets despite their limited liability. The bill requires apportioning liability on the basis of a defendant's responsibility. {time} 1800 My point in reading through this one bill is to get across to people that just in this one area we are talking about very major, very significant litigation reform in a way that is going to dramatically improve job creation, lower the cost of living in America, increase the opportunity to create new businesses and do the kind of things that will increase Government revenues by increasing the size of the economy and putting more people to work. I yield to my friend from New Jersey. Mr. SAXTON. I thank the gentleman for yielding. Mr. Speaker, I just wanted to illustrate by way of three items why the section that the gentleman reads from in our document, Contract for America, why these things are so important. Now, where the loser pays in liability suits, at least in some cases, out-of-court settlements would be encouraged. Where punitive damages--where punitive damages would be subject to reform; the truth-in-attorneys-fees and the other things the gentleman read through, why they are so important. Now, let me give three illustrations. I happen to live in a relatively small county in New Jersey, about 450,000 people. We currently have 13 judges. Those 13 judges are an expense to the taxpayer of something under $500,000 per judge, with their staff and their space costs and all of those things. It costs about $500,000 per judge per year. So we have 13 judges at that cost in my little county; that is a cost of $6.5 million a year. Now, it may not surprise the gentleman, after the words I just heard, to know that in order to bring a civil case to trial in New Jersey, in my county of Burlington, it is about a 5-year wait because the civil docket is so filled with so many suits. So that long period of time becomes a very frustrating thing for people who really have a legitimate civil suit. So there is a proposal in front of the New Jersey legislature today to create three more seats, three more judges at a cost of $1,500,000 for the taxpayers of our area to pay. Now, that is a burden on the taxpayers in Burlington County, it is a burden on the taxpayers of New Jersey. It may provide jobs for some attorneys who become judges, but I do not think that is what this is all about. So it is a very cost-producing, time-consuming situation that is caused by this huge court backlog that we have in my little county. No. 2, an illustration of what tort reform means in the items the gentleman read off, which are proposals. This is a personal story. I have a friend who is a doctor, who is a gynecologist whom I have known for years. He called me up one day not too long ago and said, ``Jim, I just wanted you to know before somebody else tells you that I am closing my practice and I am going to move to another State,'' he said, ``Colorado, and I am going to work in a clinic.'' I said, ``Why would you do that? You have a wonderful practice. You have been in practice for many years. People think the world of you.'' He said, ``Jim, I get sued so many times that I have a choice, I either have to go out of business or practice without insurance.'' He said, ``I am not going to do either. I am going to go someplace where I can practice, where I will have insurance and it won't be such a burden on me and,'' he said, ``My patients.'' I said, ``What do you mean, your patients?'' And he said, ``Well, if I have to pay $100,000 or $125,000 a year in insurance premiums, I cannot continue to pay those costs myself, I have to pass those costs along to my patients in higher doctor fees.'' So I understood then how important this was. We have discussed for a long time around this institution about how we control medical costs. One of the important ways to get a handle on medical costs is to reduce the cost within the system and tort reform, the items the gentleman has listed here, help do that. No. 3, do you know we do not build piston airplanes in this country anymore? And the reason we do not build piston airplanes in this country anymore is because the product liability associated with small piston-driven airplanes is so high because of the way the liability laws are written that American manufacturers no longer find it feasible or possible to build these types of planes anymore. So this issue that the gentleman has pointed out is something we have dealt with around here for a long time. I hope that as we put out this contract for the American people that these kinds of items will be brought to full light. I hope we can debate them throughout this coming campaign. Mr. GINGRICH. Let me say that the gentleman's points reflect three things which I want to say very quickly before I yield to my friend from Connecticut. One, we are really concerned, at its heart, about changing the things that are not working in America and we think there are--these are deep and significant. When you realize, with 13 judges in your county, it is still taking 5 years to get to court, you know something is not working right. Second, what we are proposing here in our contract is substance, these are real bills with real details. This is not some press release or some press conference, but rather a detailed systematic effort led by Congressman Armey, the conference chairman involving many Members of the Congress and many candidates across the country to develop a real good substantive program of reform. Third, the thing I was most struck with today in what I thought was a sad performance by the Democrats during the 1-minutes today, that we are being totally positive. The gentleman from New Jersey did not bash the Clinton administration, he did not talk about the Democrats just now. He talked about real problems in the litigation system, real problems in the courts and our effort to find a real solution. And that would be a fabulous turnaround for America if this fall we could have a campaign between two sets of solutions, we could have the Clinton administration, the Democrats offering their solution to these problems, and we would be offering our solutions and let the country choose which one they like. I yield to my friend from Connecticut. {time} 1810 Mr. SHAYS. Mr. Speaker, I just would like to weigh in again as a rank and file Member and emphasize that I heard one of the individuals speaking today and talking about how there was this top-down emphasis that we, as rank and file Members, would have to go lockstep in a contract with the American people, and that is an individual who simply did not know how this was generated. This was a bottomup. It was every Member weighing in whether it was moderate Members in the Republican Caucus or the most conservative, and these are elements in which we find tremendous commonality. I mean I would like not to have to have a balanced budget amendment, but as someone on the Committee on the Budget and someone who has continually tried to get our financial house in order, I do not see any other alternative, and I believe that it has to happen. I think the tool of a line-item veto is more important, and during that debate I will probably put more emphasis on that, but it is going to have my vote, a balanced budget amendment, a line-item veto, and all of us who stepped forward on the Capitol steps, 300 strong, are saying to the American people, ``If you elect us, this is what will happen.'' I look at what I am seeing Republicans do around the country, and it is exciting to see Republicans elected in Democrat States like Massachusetts, and I have seen what Governor Weld was able to do. In Connecticut, we raised taxes, instituted a new income tax. Governor Weld had the same option in Massachusetts because he had serious financial challenges, and he chose to veto budgets until he got budgets that were able to be balanced without any tax increase. One of the exciting things he did there, which we know we have to do here, is we have to take the entitlements, take them off automatic pilot, and put them back on as an appropriated expense. Welfare in Massachusetts is an annual voted item because of the leadership of a Republican. I mean I get excited thinking that for the first time in 8 years that I have been a Member, if I am fortunate enough to be returned, that I will be able to deal with these issues on the floor of the House, know that there will not be restricted votes, know that we will not have king-of-the-hill amendments so that everybody gets to vote for every amendment, but then the amendment that is designed to ultimately pass passes, but to know we are going to have open and free debate on the issues the gentleman talked about. I say to the gentleman, ``You talked about the issue of commonsense legal reform, and I thought basically you were going to consume the rest of our time because there was so much in it. We could go through each of these issues, the budgetary side and so on, and again as a member on the Committee on the Budget, what is exciting is that we are going to pay for every tax reduction, if, in fact, a tax deduction does not include more revenue. In many cases it will. A capital gains exemption by almost any outside expert knows that it is going to encourage economic growth and provide more revenues. I look at the senior citizens earning limit and think why do we want older Americans not to work? Why would we want to take those who have the greatest experience? And it seems to me, if we get older Americans to work, why should they be penalized by an earnings limit? Let them work. If they are working, my logic says they are paying taxes, and to me that seems so logical. We are going to have a debate on the floor of the House if we have enough Members who have signed this contract elected. Mr. GINGRICH. Let me just say that, again going back to why we are having a little bit of a problem over how we score, how much would this cost, the fact is the very point I just made. If we get economic growth, if people get jobs, if people leave welfare and go to work, common sense tells you you just saved the money for the Government over here on welfare because you are not paying it, and by the way, since they are now at work, they are paying some taxes, so you are making some money for the Government over here. None of that, zero, was scored by the Clinton administration is assessing what they are doing because in their model they just do not show dynamic behavior. They do not show what people are doing. And so I find it very frustrating in a way that here we are in a situation where we are trying to do develop a real set of positive ideas, the Republican House contract with America. We are trying to lay out for people 10 major bills to be brought forward in the first hundred days, 3 major things to be done on the opening day, and, by the way, my pledge is, as I hope I would be the Republican candidate for Speaker if we are a majority, and my plan would be to take this very ad out of TV Guide, and keep it at the Speaker's desk, and make it available at the time, and I yield to the gentleman from California. Mr. ROHRABACHER. I would just like to ask you, as our leader, Newt, why it is that we cannot do these things now. I do not think many of the people who were watching understand just what kind of restrictions we are under as Members of the House of Representatives as a minority. Some people do not even know that we do not control--for example, none of the chairmen of any of the committees is a Republican. Many of them--you know I had fought a big battle on the illegal alien issue in these last couple of years, and time and time again I have been thwarted from even bringing up this by parliamentary moves on the part of the majority party. Now these things we are talking about as part of our 10 points, we would have liked to have done this a long time ago, but over, and over, and over again the Democrats who control the majority, they will not even let us bring it to a vote on the floor of the House. Mr. GINGRICH. Well, of course, that is part of the difference. One of the reasons we are saying this will happen if we are a majority is because, if we are a majority, it is the Speaker's power to recognize, it is the Speaker's power to schedule, so we are then in a position to say, ``Hey, we are going to do this,'' and, if we are a majority, we can. We cannot make this same commitment if we are not a majority because we have every evidence to believe that the Democrats will block these ideas, and in fact at this very moment they are blocking, and that is part of the problem. Let me yield to another friend from California who is here. Mr. CUNNINGHAM. I thank the gentleman from Georgia. I heard Jack Kemp make a statement last weekend at the Republican convention in San Diego, and I also heard you, Newt, speak to a group, Women Who Win, to emphasize the same issue, and that issue was that it should not be the Republicans' position just to trash or debate Democratic ideals, but to come up with new ideas and new formulas that are better, and I think that what you have done with these pledges are better ideas--and to sell it to the American people. And I look at history to establish certain ideals, and I look at 1986, and there was a budget deal that for every tax dollar that comes in we will cut spending by three, and the other side of the aisle said, ``We're going to give you an ultimate way to do that, to control the budget,'' and that was called Gramm-Rudman, and Republican Presidents bought into that. But it was not enforceable. Then in 1990, Mr. Speaker, George Bush had the same pledge, for every tax dollar that comes in we were promised on the other side of the aisle that we will cut spending by $3, and to do that we are going to put caps on every budget, and we are not going to allow you to spend any more than that. That was unenforceable. And then the Clinton tax that comes up, the largest tax in the history of this country outside the 1990 tax, and yet even in a crime bill we waive the Budget Act to increase by $9 billion money going into a crime bill. So, you cannot enforce it. So, what I am trying to point out, a better idea, I would not have to take the checkbook away from my daughters if they manage their account well. I am happy to say I have not had to take that checkbook away because they are very fiscally conservative, except my older daughter maybe a little bit is a deficit spender sometimes. But at the same time the reasons why we are going to a balanced budget amendment---- Mr. GINGRICH. If she hears you said that, you may be in trouble when you get back. Mr. SHAYS. Do you want to strike your words? Mr. CUNNINGHAM. No, my oldest daughter, I apologize, but my oldest daughter is somewhat of a deficit spender. My 12-year-old is actually loaning her money at 10 percent interest. I mean she is going to be the business person in the family, and she calculates daily interest on a 486 computer at 12 years of age. But Ross Perot was right in one issue, in the fact that the country's No. 1 issue is not crime, not health care, not education, but the national debt. {time} 1820 We spend $1.3 billion a day on just the interest, and we are spending beyond what our children have. And the reason for a new idea, like a balanced budget amendment, is not a new idea. We would not have to have the idea if the problem did not exist. What we are trying to do is come to the resolution of a problem in a very effective way, because Congress cannot control itself. I commend the gentleman from Georgia. I think this is one of the most dynamic, inspiring deals that I have been involved with in the 3 years I have been in Congress. Mr. GINGRICH. Let me say the purpose of taking this time tonight is to say this is about substance, about solutions, and about being positive. I would like to challenge our Democratic friends to try to develop their version of 100 days that has the same positive substance and solution orientation, and not to just degenerate into negative 1 minutes because they have nothing better to say. ____________________