[Congressional Record Volume 141, Number 19 (Tuesday, January 31, 1995)]
[Senate]
[Pages S1806-S1823]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
resume consideration of House Joint Resolution 1, which the clerk will 
report.
  The assistant legislative clerk read as follows:

       A joint resolution (H.J. Res. 1) proposing a balanced 
     budget amendment to the Constitution of the United States.

  The Senate resumed consideration of the joint resolution.
  The PRESIDING OFFICER. Under the previous order the Senator from 
Vermont is recognized.
  Mr. LEAHY. Mr. President, we are now, really, beginning debate on the 
proposed amendment to the Constitution of the United States.
  I think before we propose to alter our fundamental charter of 
freedom, in fact, the blueprint for our representative democracy, I 
believe that we need to each step back from the political passions of 
the moment. We are debating a constitutional amendment, not just a 
political slogan or plank of a campaign platform or partisan win or 
loss or something that is supposed to fit on a bumper sticker. This is 
the Constitution. This is the bedrock of 200 years of the greatest 
democracy history has ever known. This is the standard set for the most 
powerful Nation on earth, the most powerful democracy ever imagined in 
history.
  And even though we have very, very carefully amended this 
Constitution over the past 200 years--rarely amending, because we know 
that our whole democracy is built on it--suddenly the floodgates open. 
We have in the first 3 weeks of this new Congress 75 proposed 
amendments to the Constitution--75 proposed amendments. Can you imagine 
what the Founders of this country would think if they actually thought 
that in 1 year 75 proposed amendments would be here? Seventy-five.
  The Founders of our country assumed that maybe once every several 
generations there might be some huge matter so necessary to amend the 
Constitution. Nobody ever assumed 75 proposals would come rushing in.
  The House has passed one. It is not the extreme version supported by 
the House Republican leadership, but they still passed one. The Senate 
Judiciary Committee sent a companion measure to the full Senate for 
consideration.
  Indeed, we have a backlog of proposed constitutional amendments in 
the Judiciary Committee. After a single day's hearing, we have two 
constitutional amendments to limit congressional terms on the 
committee's next agenda. There was also a hearing on another important 
topic, line-item veto, on which are pending four more constitutional 
amendments.
  The proposals for constitutional amendments already introduced in 
this 
[[Page S1807]] Congress range from the so-called balanced budget 
amendments--incidentally, there are at least three Senate versions, six 
versions considered by the House--to congressional term limit 
amendments, line-item veto amendments, school prayer amendments, 
retroactive tax amendments, and we are about to receive a proposed 
amendment to the first amendment regarding the American flag.
  I have not seen an amendment to rewrite the taking clause of the 
fifth amendment, but when you look at the revised name of the 
subcommittee, the Subcommittee on the Constitution, Federalism and 
Property Rights, you have to assume it is not far away.
  Some of these constitutional amendments call for proposed 
ratification through the State legislatures, but others demand a 
constitutional convention be convened.
  There is a feeling, I guess, that we can do far better by convening 
one than those who wrote the original Constitution--Madison, Hamilton, 
Franklin, Morris, and Washington--that we can now do much better. They 
did not have the advantage of radio talk shows, I guess, or multi-
million-dollar political consultants.
  I have to ask, with a new majority in both the House and the Senate, 
what are their plans for rewriting our Constitution? Why the sudden 
need to change our 200-year Constitution? Do they want to have a host 
of constitutional amendments come forward or one, two, or five or six? 
Enough.
  The Constitution is a good document. It is not a sacred text, but it 
is as good a law as has been written. That is why it survived as the 
supreme law of this land for over 200 years with few alterations. It is 
binding us together rather than tearing us apart.
  Look at the great compromise in the Constitution that allowed small 
States and large States to join together in a spirit of mutual 
accommodation and respect, an amazing step, not done because of the 
passions of the moment, but by great thinkers in this country. And it 
has stood the test of time. It gives meaning to our inalienable rights 
to life, liberty, and the pursuit of happiness. It requires due 
process, it guarantees equal protection under the law, it protects our 
freedom of thought and expression, our freedom to worship or not to 
worship as we choose, and our political freedoms as well. It is the 
basis for our fundamental right of privacy and for limiting 
Government's intrusions and burdens in our lives.
  I worry that we are so bent on moving so rapidly, as though we are 
passing some kind of an amendment to a minor bill, that we can not 
fully debate this amendment. That is not the way the Constitution 
should be amended.
  I have to oppose what I perceive to be a growing fascination with 
laying waste to our Constitution and the protections that have served 
us well for over 200 years.
  The first amendment--the separation of powers, the powers of the 
purse--these should be supported and defended. It is the oath we all 
swore when we entered service in this great and historic Chamber. That 
is our duty, not only to the Senate and the American people today, but 
to those who forged this great document, our responsibility to those 
who sacrificed to protect and defend our Constitution, often times 
laying down their lives to do it, and our commitment to our 
constituents today, and our legacy to those who will succeed us in this 
body.
  In this constitutional amendment to try to balance the budget, there 
is added irony. The Republican Party has assumed majority status in 
both the House of Representatives and the Senate. They control the 
legislative agenda. They can pass any budget they want. We are talking 
about a two-thirds vote amendment, a constitutional amendment to 
balance the budget in the year 2002. It only takes 50 percent plus 1 to 
pass a balanced budget today. There are far more Republicans than that. 
There are a majority of Republicans in the House and the Senate. They 
could pass a balanced budget tomorrow if they wanted and not have to 
fiddle with our Constitution and say, ``Maybe in the next century, the 
next millennium, in the year 2002, whoever is standing will do it for 
us.''
  They want to balance the budget, eliminate the deficits, start paying 
off the debt, including the huge debt of the Reagan years. The 
Republican majority could do that by a simple majority vote in both 
Houses of Congress in a matter of days.
  I think that would show the leadership necessary. Instead, having 
taken over the majority, they propose a constitutional amendment which 
basically says we cannot trust the majority in the House and the 
Senate. There is somewhat of an irony here, Mr. President. If they 
really trust themselves, let us pass one right now.
  I am concerned that we are too ready to seek what appears to be the 
quick fix. The Constitution cannot be amended by sound bite. 
Supermajority requirements undercut our constitutional democracy. They 
evidence distrust not only of our Constitution but of the people who 
sent us here.
  Proposed amendments to our fundamental charter require consideration 
whether they are, in the language of article V of the Constitution, 
constitutionally necessary. I hope that we are not going to burden the 
public or the States with a hodgepodge of poll-driven, popular-sounding 
constitutional amendments at some helter-skelter pace to beat some 
artificial deadline.
  I hope that we will fulfill our responsibilities, not only in our 
individual committees, but in the bodies of both the House and the 
Senate, to have fair and open discussion.
  I have studied the so-called balanced budget amendment. I have 
summarized 10 reasons to oppose the proposed constitutional amendment 
in my supplemental minority views contained in the Senate Report No. 
104-5. I will have occasion to speak to these and other reasons during 
the course of our debate.
  I urge my colleagues to consider the views of Senators Biden, Heflin, 
and Kyl; the minority views, including those of Senators Kennedy and 
Feingold; the hearings of Senators Byrd and Hatfield on this last year. 
These are, in my view, essential background for this debate.
  Let us take a look at this. Let us turn away from what appears to be 
a closed shop on this issue. Let us turn back from this path before 
partisan bickering and legislative gridlock overwhelm us to the 
detriment of the American people. In the U.S. Senate, of all places, we 
should not be afraid to have ideas debated, openly debated and voted 
on. Let us not resort to tabling motions on amendments, which allow you 
to be on both sides of an issue; but let us vote straight up or down. 
You do not come here to vote maybe, you come to vote yes or no. That is 
what we should do.
  Our distinguished Judiciary Committee chairman has called this the 
most important matter that we will consider this year. I agree with 
him, but let us offer amendments and vote on their merits instead of 
engaging in procedural shortcuts.
  There will be much more said. But, Mr. President, I come from a 
family that has revered the Constitution. I grew up with a father who 
told me how important it was because it protected the rights of not 
only the majority but of the minority.
  I came from a family that found itself in the early part of this 
century in a religious minority and most of its life in a political 
minority in our State. But we knew the protections were always there. 
We knew they were always there for everybody. We knew we had a 
Constitution that stood the test of time. That was strong, that could 
be changed only by great effort, and only when there was an extreme 
need in the Nation to do so.
  Mr. President, that is the philosophy with which I grew up. It is 
neither a liberal nor conservative philosophy. It is an American 
philosophy. I hope we hold to it.
  I yield the floor, and I understand under the previous order that it 
would go to the Senator from Minnesota.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I ask unanimous consent that as soon as I 
finish my short remarks, the next person to be recognized be the 
distinguished Senator from Minnesota.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HATCH. I thank the Chair.
  [[Page S1808]] Now, there is nothing more important we can do than 
improve the general welfare of all the American families and reduce the 
national debt that is eating away like a swarm of termites on a log. 
The way to do that is to pass the balanced budget amendment to the 
Constitution. To me, unless we do this, we are going to be in real 
trouble in this country. This past week, the House of Representatives 
answered the question: If you have to balance your checkbook every 
month, should not the Federal Government have to balance its books 
every year?
  Their answer was ``yes,'' 300 to 132. They answered the question: Has 
Washington spent your tax dollars wisely? And their answer was ``no''--
228 Republicans and 72 courageous Democrats bit the bullet and did the 
right thing. What a victory for all of us.
  Right now, our debt is a staggering $4.8 trillion. That means that 
each and every one of us in this country, including every child, owes a 
whopping $18,500, and it keeps going up every day.
  We can no longer saddle our children with decade after decade of 
unbalanced budgets. We have not balanced this budget in 26 years, and 
it appears to me that we have not balanced it but a few times in the 
last 60 years.
  Current interest on the national debt is $300 billion a year and 
rising. Believe it or not, that is more than the total revenues that 
came to the Federal Government back in 1975. If the current trends in 
Federal spending continue, the Federal Government will double in size 
and consume nearly half of our gross domestic product in the next 35 
years, where today it is consuming a lot less than that although more 
than it should.
  The annual deficit causes untold damage to our economy. It hurts our 
wages. It raises our interest. It reduces the number of job 
opportunities for all of us. For those Americans who are retired, the 
biggest threat to Social Security is the Federal Government's fiscal 
responsibility--fiscal irresponsibility, I should say--because they are 
making the Federal dollar less and less important, and actually we will 
reach a point where it will be worthless. If we do not stop the 
spending binge, it will kill Social Security.
  Instead of supporting the balanced budget amendment, the 
administration points to its so-called deficit reduction plan as the 
solution to our problems, but in fact President Clinton's deficit 
reduction plan was his 1993 tax increase, the largest in history. If 
you think raising taxes is the way to solve our budgetary problems, 
then hang onto your hats. You had better hang onto your wallets and 
pocketbooks as well.
  Under the President's plan, the national debt will increase by $1 
trillion in the next 5 years alone, even if all of his optimistic 
economic assumptions turn out to be true.
  It is ironic that while many oppose the Balanced Budget Amendment Act 
because, they argue, it is nothing but a gimmick, the special interests 
are out in full force to protect their favorite, expensive, pork barrel 
spending programs. But whatever happened to the national interests? 
What about protecting the economic well-being of America and the future 
economic well-being of our children and grandchildren? We have to make 
these decisions now, and that is why this debate is important.
  Personally, I do not like to amend the Constitution, but we have 
reached a point of no return where, if we do not amend the Constitution 
of the United States, we do not put this fiscal mechanism into the 
process, and we do not adopt a mechanism that forces Members of 
Congress to make priority choices among competing programs, this 
country will not be able to maintain its strength as the greatest 
country in the world and everybody, including every special interest in 
this country, will suffer in the process.
  I have taken enough time this morning. I know my dear friend from 
Minnesota is about to speak, and I will yield the floor at this time.
  Mr. WELLSTONE addressed the Chair.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. WELLSTONE. I thank my good friend and colleague from Utah for his 
graciousness, Mr. President. And he is, agree or disagree, a good 
friend. It feels good for me to say that.


                    Motion Intended to be Submitted

  Mr. WELLSTONE. Mr. President, I ask unanimous consent to have a 
motion printed in the Record which I intend to make at some time while 
House Joint Resolution 1 is pending.
  There being no objection, the motion was ordered to be printed in the 
Record, as follows:

                Motion to Refer House Joint Resolution 1

       Mr. Wellstone. Mr. President, I move to refer House Joint 
     Resolution 1 to the Budget Committee with instructions to 
     report it to the Senate accompanied by a report containing a 
     detailed description of a 7-year budget plan that would 
     achieve a balanced budget by 2002.

  Mr. WELLSTONE. Mr. President, I will in the course of my remarks 
respond to some of what my colleague from Utah had to say, but first, 
so that my other colleagues in the Senate are aware of what I intend to 
do on the floor of the Senate at the right time, let me summarize this 
motion.
  I intend at some time to move to refer this resolution, House Joint 
Resolution 1, to the Budget Committee with instructions to report it 
back to the Senate, accompanied by a report containing a detailed 
description of a 7-year budget plan that would achieve a balanced 
budget by the year 2002.
  Mr. President, I ask unanimous consent that a piece by Al Hunt in the 
Wall Street Journal of Thursday, January 12, be printed in the Record 
at this point.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

             [From the Wall Street Journal, Jan. 12, 1995]

         The Balanced Budget Amendment: A Contract With Evasion

       ``We propose * * * to restore the bonds of trust between 
     the people and their elected representatives. That is why, in 
     this era of official evasion and posturing, we offer instead 
     a detailed agenda. * * *''--The House Republicans' Contract 
     With America.
       ``The fact of the matter is once members of Congress know 
     exactly, chapter and verse, the pain that the government must 
     live with in order to get to a balanced government [sic], 
     their knees will buckle.''--House Majority Leader Richard 
     Armey on ``Meet the Press'' last Sunday, justifying GOP plans 
     to pass a balanced budget constitutional amendment without 
     specifying how it'd be achieved.
       Dick Armey probably remembers House consideration last year 
     of a real balanced budget measure offered by Rep. Gerald 
     Solomon (R. N.Y.). It proposed huge cuts in health care, 
     agriculture and income security for the poor, while 
     completely eliminating all aid to Russia and subsidies for 
     Amtrak and air service to remote areas.
       The Solomon proposal got a grand total of 73 votes; 
     Republicans, by more than a 2-to-1 margin, voted against it. 
     Passing a balanced budget amendment may be easy; getting a 
     balanced budget isn't.
       In a reasonable path to balance by 2002, the budget would 
     have to be cut by more than $1 trillion. This would be almost 
     30% larger than the 1990 deficit reduction legislation and 
     more than 40% bigger than the 1993 measure.
       The Republicans have excluded Social Security and defense, 
     and discretionary domestic spending already is frozen. Thus a 
     huge burden would be borne by the budget's fastest growing 
     area, health: Medicare and Medicaid now are about 3.8% of 
     gross domestic product; by 2002, without congressional 
     action, these entitlements would soar to 6% of GDP.
       The public is solidly behind a constitutional amendment; 
     that's why it's featured in the Contract With America. But, 
     as the Wall Street Journal/NBC News poll revealed last month, 
     voters dramatically turn against it if that means 20% cuts in 
     Medicare, Medicaid and veterans benefits. Thus, Dick Armey & 
     Co. find evasion and posturing more attractive.
       (Ironically, in contrast to this duplicitious measure, 
     Senate Budget Committee Chairman Pete Domenici genuinely 
     worries about deficits and wants to atone for the fiscal sins 
     of the early 1980s. His House counterpart, John Kasich, is as 
     knowledgeable and honest as he is earnest on these matters.)
       It's outrageous that the GOP's self-proclaimed foes of the 
     old politics whine that it's political suicide to address 
     Social Security now. Last year two old dinosaur Democrats, 
     Dan Rostenkowski and Jake Pickle, specifically proposed to 
     trim cost of living increases for Social Security, raise the 
     retirement age and cut benefits for more affluent recipients. 
     Is it too much to ask the supposedly fiscally responsible 
     Republicans to be as serious?
       The $69 billion current trust fund surplus disappears in 
     less than 20 years when the baby boomers start retiring. To 
     suggest, as some Republicans do, that it'll be more 
     politically palatable to address Social Security when more of 
     these baby boomers are closer to actually retiring is, to be 
     charitable, illogical.
       [[Page S1809]] Under a constitutional amendment, even if 
     unfunded federal mandates are abolished, the states will take 
     it on the chin. Governors will embrace a 10% reduction in the 
     600 categorical grants if they are turned into bloc grants 
     with fewer strings attached. But a balanced budget amendment 
     would necessitate more reductions. The big entitlements for 
     the states--Medicaid, food stamps and welfare--would be cut 
     drastically. Vermont's Democratic governor, Howard Dean, 
     calculates that state funding would be reduced by 40% over 
     seven years; on a state-by-state basis, it's calculated that 
     New York, for example, would lose $11.225 billion in fiscal 
     2002, two-thirds of that from Medicaid.
       At least those would be real cuts and there would be real 
     debates. More commonplace would be gimmicks such as increased 
     use of loan guarantees or unrealistic assumptions. (The 
     measure doesn't require a balanced budget; it only requires 
     that actual outlays don't exceed projected outlays.) Look for 
     a huge increase in the use of regulatory instead of budgetary 
     measures to meet demands for action, affecting state and 
     local governments and business.
       Conservative legal expert Robert Bork, an eloquent opponent 
     of this amendment, has noted that ``government need spend 
     nothing on a program if it can find groups in the private 
     sector that can be made to spend their own funds.'' He also 
     envisions that unelected judges would be dealing with 
     hundreds of suits to enforce--or not enforce--the amendment, 
     as does Ronald Reagan's solicitor general, Charles Fried, who 
     warns that the litigation would be ``gruesome, intrusive and 
     not at all edifying.'' (When House Republicans follow their 
     speaker's advice to read the Federalist Papers, they may 
     glance at number 78, where Alexander Hamilton proclaims that 
     the judiciary should have ``no influence over either the 
     sword or the purse.'')
       Remember, the Gramm-Rudman legislation specifically 
     promised to eventually balance the budget; instead the 
     deficits soared. Democratic Rep. David Obey of Wisconsin sees 
     that pattern re-emerging: ``The cycle which quadrupled the 
     deficit in the 1980s will be repeated. The amendment says we 
     need 60 votes to pass a budget that's not balanced.'' When 
     that horse trading starts, Rep. Obey ventures, all the 
     pressures will be to add spending to attract votes. ``In all 
     my years as a legislator I don't think I've ever seen a 
     member say I'll vote for something if you take things out. If 
     this baby passes, I'll make a flat prediction: Three years 
     after it is passed we still have a deficit well over $100 
     billion.''
       More than adding to public cynicism, that will debase the 
     Constitution. Imagine a decade from now a businessman trying 
     to collect $100,000 because the state has unconstitutionally 
     taken part of his property for governmental use. When the 
     country is violating the Constitution by $100 billion or $200 
     billion, who's going to worry about a paltry $100,000 
     constitutional offense?

  Mr. WELLSTONE. His piece begins with an interesting quote:

       We propose * * * to restore the bonds of trust between the 
     people and their elected representatives. That is why in this 
     era of official evasion and posturing, we offer instead a 
     detailed agenda * * *.

  This is a direct quote from the House Republicans' Contract With 
America. And the following comes from House Majority Leader Dick Armey, 
on Meet the Press:

       The fact of the matter is that once Members of Congress 
     know exactly, chapter and verse, the pain that the Government 
     must live with in order to get a balanced budget, their knees 
     will buckle.

  Mr. President, yesterday, in Minnesota, I called on the legislative 
leadership in our State to put together a task force to assess the 
impact of a balanced budget amendment on the State of Minnesota. I did 
this, Mr. President--and this has been met with a positive response by 
legislative leadership--because last week I came to the floor with an 
amendment based upon a resolution from my State of Minnesota. This 
resolution was passed unanimously by the State Senate, Democrats and 
Republicans alike, almost unanimously by the House of Representatives, 
and signed by our Republican Governor, Governor Carlson, on January 20.
  What this resolution said was, ``when''--I changed my amendment to 
``if''--the constitutional amendment passes the Congress, Congress 
should send to the States, send to Minnesota, an analysis of the impact 
of this balanced budget amendment on State and local government and on 
the people in our State.
  That amendment was defeated by essentially a party-line vote. I think 
I received 45 votes for that amendment. Talk about the right-to-know: 
my amendment simply said that if we pass a balanced budget amendment, 
before we send the amendment to the States we should provide an 
analysis of its impact on the people of the different States. I think 
every single one of my Republican colleagues voted against it. Talk 
about the importance of being straightforward, stepping up to the 
plate, being direct with the people we represent. Talk about the 
importance of the right to know--people should have the right to know 
what the impact of this balanced budget amendment will be on their 
lives before we pass it. Talk about the sort of crazy proposition that 
before you buy a used car you shouldn't lift up the hood and look at 
the engine. I was really dismayed that this amendment was defeated.
  What I am now saying is very consistent with, I think, responsible 
public policy. My fundamental disagreement with some of my colleagues 
on the other side of the aisle is that I think we owe it to people in 
this country to lay out a detailed 7-year plan as to where we are going 
to make these cuts before we pass this. I think the reason my 
colleagues do not want to do this is because they do not want to lay 
out their plans.
  Let me give some context, which I think really gets to the heart of 
this. Using conservative estimates, the Congressional Budget Office 
estimates that the interest savings that would come from the cuts--let 
us factor that in, let us be fair--even taking that into account we are 
talking about a little over $1 trillion worth of cuts between now and 
2002. To get to a balanced budget --$1 trillion worth of cuts. Where 
are we going to make the cuts?
  On the next graph, Mr. President, is illustrated some real numbers. 
People in the country have a right to know where we are heading. By the 
way, I think the analysis I am about to make is in many ways 
irrefutable, just in terms of the basic commitments that some of my 
colleagues have already made. If you add the defense increases, and you 
also add tax cuts--I think the defense increase was, roughly speaking, 
$80 billion over 5 years and I think the tax cut was, roughly speaking, 
$360 billion over 5 years--now we are not talking about $1 trillion, we 
are talking about $1.481 trillion.
  Now we are no longer talking about $1 trillion, we are talking about 
$1.481 trillion that we are going to have to cut between now and 2002. 
That is why I am going to move at the appropriate time that we refer 
this resolution to the Budget Committee with instructions to the Budget 
Committee that it bring to the Senate a report that contains a detailed 
description of a 7-year budget plan as to how we are going to cut 
$1.481 trillion.
  Do we not at least owe that to people in the country? Is that not 
called truth in budgeting? Is that not called being straightforward? Is 
that not called stepping up to the plate and being clear and being 
honest about what we intend to do? Mr. President, $1 trillion says CBO, 
and in addition we have a bidding war to raise military expenditures, 
and in addition we have a bidding war for more tax cuts. Now we are 
talking about $1.481 trillion.
  Let me turn to the next graph. Here is what I believe my colleague, 
Senator Conrad from North Dakota called--and I say this to you always 
in good grace, ``the Republican credibility gap.'' So far the spending 
cuts we have heard detailed in the Republican Contract is about $275 
billion. We have seen specifics of $277 billion of budget cuts. Mr. 
President, $1,481 billion is what we have to cut to get to this 
balanced budget by 2002. So far my Republican colleagues have laid out 
budget cuts totaling $277 billion. There is a long ways from $277 
billion here to $1,481 billion. That is truly the Republican 
credibility gap. And that is why at the appropriate time I will move to 
refer this resolution to the Budget Committee with instructions to the 
Budget Committee that it lay out a detailed plan as to exactly where we 
are going to make these cuts. We are not going to do well with people 
in this country once they realize we are quite unwilling to specify 
where we are going to make the cuts. People are going to begin to see 
this as a shell game, shifting burdens to the States, to personal 
income, property, and sales taxes of the states.
  When I was back in Minnesota yesterday I said one of the reasons why 
it was so important to have some truth in budgeting--so important that 
people have a right to know where we are heading--is because of the 
likely impact on my State.
   [[Page S1810]] The Center on Budget and Policy Priorities issued a 
report yesterday, and I have some preliminary figures from that report. 
By 2002, in that 1 year alone where will we in Minnesota be? We will 
have $143 million less in Federal education. Where will we be: $1 
billion, in 1 year, less in Medicaid; about $3 billion of cuts over the 
next 7 years.
  This is another part of what I consider to be, really, a shell game. 
The cuts accelerate. They are less over the first 2 years and then they 
get deeper and deeper. When I say in the State of Minnesota we could 
very well be faced with $1 billion of cuts in Medicaid in 1 year alone, 
I want my colleagues to understand that half of Medicaid expenditures 
go to older people for nursing home expenditures. These are our parents 
and our grandparents. I think the figures on Medicare go even higher.
  What do these figures mean? The Children's Defense Fund estimates 
that such cuts in 2002 would result in almost 30,000 Minnesota babies, 
preschoolers, and pregnant women losing WIC nutrition supplements; over 
351,000 children losing food stamps; over 154,000 children losing free 
or subsidized lunches; over 2,004 blind or disabled Minnesota children 
losing SSI; and over 24,000 children losing access to remedial 
education.
  I have heard my colleagues talk about our children and our 
grandchildren and the debt. I have voted for deficit reduction. I have 
voted for several years in a row for the deepest cuts we have seen in 
deficit reduction in decades and I will continue to do so. But for many 
children, the future is now. We keep talking about our children and the 
future, and I bring an amendment to the floor of the Senate 2 weeks ago 
asking the U.S. Senate to go on record saying that nothing we shall do 
by way of spending cuts or legislation will increase the number of 
homeless or hungry children in America and I cannot get a majority vote 
for that.
  Let me repeat that. My colleagues talk about our children and our 
grandchildren. Maybe our children and our grandchildren are doing well 
now. We have fairly high salaries, and do well economically. But a lot 
of our children and grandchildren are not doing well now. For them the 
future is now. And I came to the floor 2 weeks ago with a reasonable 
sense-of-the-Senate amendment that we would go on record saying we are 
not going to do anything that would increase hunger or homelessness 
among children in America.
  Mr. President, did you see the report today that one out of every 
four children in the United States of America are poor? One out of 
every four children under the age of 6. What about those children now? 
I could not get my colleagues to vote for that amendment. I think I 
understand why.
  Let me go back to the chart on the credibility gap for a moment, if I 
could. Let me tell you why, Mr. President, the two amendments I have 
introduced in the last 2 weeks have failed with every single Republican 
voting against it. The first amendment, we will not do anything that 
will increase homelessness or hunger among children. The second 
amendment said we will at least provide States with financial analysis 
of the impact of the balanced budget on them before we send it to them 
for ratification. Why were those amendments voted down? What is it that 
my colleagues do not want people in Minnesota or Tennessee or Utah or 
anywhere else in the United States to know about the implications of 
this balanced budget amendment? It is the credibility gap.
  These are the parameters. We are talking about, roughly speaking, 
$1.481 trillion worth of cuts, and so far my colleagues have specified 
$277 billion. That is a big credibility gap. And after you raise the 
Pentagon budget, and after you do more by way of tax cuts--and then we 
are saying that we are not going to be cutting Social Security; there 
seems to be strong agreement on that--in addition you pay interest on 
the debt. Do we think people do not see through this charade? It is 
clear where we are going to be making the cuts. Mr. President, I do not 
know about other States, but I will tell you one thing. When we cut the 
WIC Program, the Food Stamp Program, subsidized lunches, remedial 
education, law enforcement, environmental protection, higher education, 
and any number of other key areas, either our States will walk away 
from the people or our States will end up having to assume the costs.
  These burdens are going to go back to the States. And I can predict 
what is going to happen. Just as we now, unfortunately, have moved to 
several tiers--people on the top and many people on the bottom--either 
we are going to have States that are going to pick up the costs--I can 
tell you, I will speak for Minnesotans. We are not going to let 
children go hungry. We are going to make sure that our young people can 
afford higher education. We are not going to break our contract with 
veterans. If there are going to be deep cuts in Medicaid and Medicare, 
we are going to make sure that people continue to have health care when 
they need it.
  So we are going to end up having to pay for it. That is the shell 
game to this. That is why my colleagues are unwilling to specify what 
we are going to do. My colleagues are unwilling to step forward and say 
what we are going to do.
  Mr. President, for myself I have never signed on to the notion of a 
balanced budget in the year 2002 because I think it is so political--
and because it would depend on the economic circumstances at the time. 
For example, we wouldn't want to do huge spending cuts if we were in a 
recession. Of course, we have to continue with deficit reduction. Of 
course, we have to balance the budget. But the question is, What gets 
taken off the table and what gets put on the table? I have not heard a 
word so far about cuts in the military budget.
  Mr. President, Senator Bumpers, Senator Bradley and I and several 
other Senators 2 or 3 weeks ago had a press conference looking at a lot 
of analysis that has been done on defense needs and potential defense 
and other related cuts. We essentially made the argument that here are 
some military expenditures that are just simply not necessary when we 
have to make these difficult choices, and we had cuts totaling $33 
billion over the next 5 years; $114 million from 1996 to 2010. There 
are a lot of different programs listed. I will not itemize them today. 
I will later on in the debate.
  Some of these are worthy programs. For example, let me say the space 
station has many exciting possibilities. But I would far prefer to feed 
children on Earth in the United States of America than to send a 
station into space. We have to start making these difficult choices. 
But I do not hear people talking about any of these big military 
contractors having to sacrifice. Oh, no. Oh, no. It is the children, a 
quarter of whom are poor, who do not have lobbyists, who do not have 
political power. So what we are going to do--which is why we are 
unwilling to specify the cuts beforehand--is we are going to make cuts 
based upon the path of least political power.
  It is interesting. Again, I borrow from the fine work of Senator 
Bumpers. When I hear my colleagues say we have to raise the Pentagon 
budget. But we will cut the School Lunch Program, we are going to do 
it. The arithmetic is compelling. We are not coming anywhere close to 
telling people how we are going to cut $1.4 trillion. We know where we 
are going to cut. That is why we are unwilling to be clear about it. 
That is why we are unwilling to specify before we pass the balanced 
budget amendment. I have not heard any discussion about cutting 
military contracts.
  Just a couple of interesting figures on this chart. If we take the 
U.S. defense budget and you add NATO and other allies, altogether we 
are spending about $530 billion. Russia, China, and all the rest of our 
potential adversaries combined, total potential adversaries combined, 
only spent $121 billion. The United States alone has a larger defense 
budget--$280 billion--than all of our potential adversaries combined, 
which is $121 billion. Yet some are talking about raising the Pentagon 
budget. We are talking about a little more to cut taxes for people, and 
then we say we are going to have deficit reduction through a balanced 
budget amendment, but we are unwilling to specify where we are going to 
make the cuts. We are unwilling to tell people in Minnesota, Tennessee, 
and Utah, all across the country where they are going to be at 2002 and 
what they are going to be faced with.
  There are, of course, other choices to be made. I will be on the 
floor later on 
[[Page S1811]] with Senator Feingold and others talking about this. But 
it does strike me as odd and politically troubling, if you look at the 
Republican contract, if you look at the Contract With America, there is 
no mention of anything that asks large corporations, or large financial 
institutions, or any other wealthy interests, to sacrifice at all.
  They say we are going to cut nutrition programs for children. There 
is no question about that. We are going to cut child care. We are going 
to cut higher education. We are going to cut Medicaid. We are going to 
cut Medicare--deep, deep cuts that will accelerate as we approach the 
year 2002. We will likely not do much the first year, before the 
elections. It is all carefully designed. It has to happen. The 
arithmetic is clear. But we are not going to touch oil company 
subsidies at all. We are not going to go after bloated military 
contracts. We are not going to deal with some of the other loopholes 
and deductions that a variety of different large, powerful financial 
institutions are able to take. We are not asking them to sacrifice at 
all.
  That is the reason, Mr. President, we do not want people to know 
where we are going to make the cuts. We are likely going to go forward 
and pass a balanced budget amendment without even being willing to be 
straightforward and clear with the citizens we represent as to what 
this means for their lives, as to what kinds of cuts we are going to 
make, in what kinds of programs and how it is going to affect them and 
their children.
  That is why I intend, at an appropriate time, to move to refer this 
resolution to the Budget Committee with instructions to report it to 
the Senate accompanied by a report from the Budget Committee containing 
a detailed description of a 7-year budget plan that would achieve a 
balanced budget by the year 2002.
  Should we not be honest with people and straightforward with people? 
Why do we not do that? The answer is, we do not want to tell people 
where we are going to make these cuts. We want to pass perhaps the most 
important piece of legislation that has been passed in decades, with 
far-reaching consequences for the people we represent, for the lives of 
people we represent, and we do not want to, before we pass the balanced 
budget amendment, lay out the plan as to where we are going to make the 
spending cuts and other policy changes required, and how they are going 
to affect our States and counties and our cities, how they are going to 
affect the people we represent.
  Mr. President, it is interesting, I want to make this clear that this 
is not just an urban issue. I was this past weekend in Jackson County 
in southern Minnesota meeting with corn and soybean growers. I say to 
my colleague from Utah that I will bet you the vast majority of the 
people there are for a balanced budget amendment; I think that is true. 
But what they are worried about is that they want to know where the 
cuts are going to take place. When we hear that subsidies are going to 
be eliminated, we are all for it if we know where they are and if you 
give us a fair price in the marketplace. For those of you who know this 
language--and if you come from Minnesota, you certainly do--they are 
talking about the loan rate and Commodity Credit Corporation. Give us a 
fair price, that is all we ask for. Then they say: We have not heard 
people talk about the fair price and about cutting back on the 
conservation program, not giving us a fair price. If you do that, you 
are taking a good percentage of farm income of people who are barely 
hanging on.
  Mr. President, under a balanced budget amendment there are going to 
be deep cuts and a lot of people are going to be hurt. My colleagues 
say, well, we have to do all this, it is in the national interest. It 
is in the national interest to continue to reduce the deficit. It is in 
the national interest to move toward a balanced budget. It is in the 
national interest to do it by the same standard that every single 
family in this country lives by when they balance their budget, which 
is a standard of fairness, not just targeting those with the least 
amount of political clout, or going after health care and education, or 
children and leaving all sorts of other subsidies untouched. That is 
the way we should do it.
  But, Mr. President, we are not going to do it that way. Let me be 
crystal clear. We are not going to do it that way. Instead, we are 
going to make deep cuts, we are likely going to pass a balanced budget 
amendment, and ultimately we may not, because I think the longer this 
debate goes on and the more people pay attention to this debate, they 
are going to say wait a minute.
  Back to the chart on the credibility gap one more time. They are 
going to say, wait a minute, Senators, we heard there was going to be a 
trillion dollars in spending cuts, and then we hear that there are 
those saying they want to increase the Pentagon budget by $80 billion 
over 5 years; then we hear everybody is in this bidding war to cut more 
taxes which means less revenue, which has to be offset somewhere. Now 
we hear that the estimate, conservatively speaking, is $1.481 trillion. 
So far, proponents of the amendment have only specified $277 billion 
worth of cuts they are willing to make. We would like to know, 
Senators, Democrats and Republicans alike, where are you going to make 
the cuts? How is it going to affect us? Is it going to be according to 
some standard of fairness? Are we going to have to pick it up at the 
State level? Is it going to be the property tax or sales tax that now 
we are going to get hit with?
  Well, people have every right to ask those questions. In fact, there 
is overwhelming support in the United States of America for the right-
to-know proposition: Recent polls show over 85 percent in favor. Last 
week, I came to the floor with an amendment that I thought would pass. 
It was so reasonable. It said if we pass a balanced budget amendment, 
let us send it to the States with a detailed analysis of how this will 
affect Minnesota or Tennessee, and the people who live in our States. 
It was voted down, essentially a straight party vote.
  Mr. President, over the weekend, I have been thinking long and hard 
about this. I have decided, before we get too far into this debate, I 
should come to the floor before we get too far into the amendments and 
move to refer this resolution to the Budget Committee, with 
instructions for the Budget Committee to come back with a report that 
contains a detailed description of the 7-year budget plan. That is 
reasonable. It is consistent with being accountable. It is consistent 
with being straightforward with people and with the people of the 
United States of America knowing exactly what we are going to do. I 
think that is exactly what people believe in strongly.
  So I have filed this motion, and a little later on I will go forward 
with this motion. I thank my colleague from Utah.
  I yield the floor.
  Mr. HATCH. Mr. President, I have listened to my distinguished friend 
from Minnesota. As usual, he is an advocate for those who are poor and 
have difficulty in our society. I admire him for that. On the other 
hand, I do not think there is a person in America who thinks for one 
second that this voracious, money-eating, money-grubbing Federal 
Government does not eat up an awful lot of this money right here in the 
bureaucracy. In fact, there are many authorities who seem to indicate 
that of all the billions of dollars taxpayers are spending for the 
poor, welfare, food stamps, AFDC, you name it, and the thousands of 
programs that we have, some believe that only 28 percent of all of that 
money we pay actually gets to the poor.
  Mr. WELLSTONE. Will the Senator yield for a minute?
  Mr. HATCH. I will be happy to.
  Mr. WELLSTONE. I want to make it clear that I know everything the 
Senator says he says in good faith, and he is always rigorous in his 
analysis. When I hear the Senator talk about how there are all sorts of 
overly centralized programs and bureaucratized programs and there are 
cuts we can make, I say to the Senator: Fine, the only thing that I am 
going to do in this motion is to say to the Budget Committee, before we 
vote, let us be clear about where we are going to make the cuts.
  I do not necessarily disagree with what the Senator is saying. I have 
to see the numbers. But let us lay them out. If the Senator and other 
members of the Budget Committee can tell me how we get from $277 
billion to over $1 trillion in cuts and where they are going to be, 
that is what we should do.
   [[Page S1812]] Mr. HATCH. I will get into that in just a minute. I 
want to make this point, and I am glad the Senator recognizes there may 
be some merit to this point. We, in the interest of controlling 
everybody--we liberals back here in Washington--and that is what you 
have to call us--we have built such a bureaucracy that we are robbing 
everybody, and very little of that money actually gets to the people 
that my friend is worried about. And I too worry about those less 
fortunate than most.
  I am the author of the child care bill, along with Senator Dodd. He 
and I were there at the last minute of that particular Congress making 
sure it went through. Nobody in America was more concerned about child 
care than I was, and I am a conservative. So I take second seat to no 
one on this problem. It is not an unknown fact that I was the person 
who helped to save the Job Corps Program, which is the only program for 
unemployed youth in our society. It is expensive. It costs over $20,000 
per youth per year. On the other hand, if we just write them off, they 
are going to cost us better than a million dollars a person by the time 
they die. We will all have to pay for that.
  I can name a number of other programs I have helped to save and have 
passed here that are very important. I have just as much feeling about 
the poor and the sick and the needy and our senior citizens as any 
Senator in this body, including the Senator from Minnesota.
  But I know that this bureaucracy back here, that this liberal Federal 
Government which employs an awful lot of people here in Washington at 
pretty high rates of pay compared to the average citizen's salary, is 
eating us alive before the moneys get to those who really need it. And 
when the moneys finally get there, they are minuscule compared to what 
we taxpayers have paid.
  I hear the distinguished Senator talking about how we have to cut the 
military so that children can eat. No, we have to cut the bureaucracy 
so both the military can be strong and children can eat. And we will 
never do it without a balanced budget amendment.
  We get credit for these programs. We get a lot more credit for 
spending than we do for standing on the floor and conserving.
  Having said that, I have been very intrigued by colleagues on the 
other side, almost none of whom is for the balanced budget amendment. 
Why? Because they like to spend. They do not want any hampering 
restrictions on their ability to do good. And I am not questioning 
their sincerity, but I do question whether they are doing good all the 
time, laundering the moneys to an all voracious eating Federal 
bureaucracy.
  I would rather send those moneys to the States, where the States, who 
understand local problems, will do a far more efficient job than the 
Federal Government. Our Governors are begging us to send block grants 
for welfare to them. They do a better job. They will make it more 
efficient. They will get more help to people and in the end people will 
be better off.
  When Reagan became President, I became chairman of the Labor and 
Human Resources Committee. That committee overviews between 2,000 and 
3,000 Federal programs. President Reagan came to me and said, ``Orrin, 
you have six of the seven block grants in your committee.''
   Now, it was an interesting thing, because I had a heck of a time 
getting any block grants passed. It was still a pretty liberal 
Congress, even though the Republicans had taken over control of the 
Senate. But the House was still controlled by Democrats.
  I was having a rough time. One day President Reagan called me and 
said, ``Orrin, what is the matter with you up there? Why can't you do 
what I have asked you to do?''
  And I have to say that I was not quite as respectful to the President 
as I should have been--and I have always been. I said, ``Wait a minute, 
Mr. President.'' I said, ``Have you looked at the makeup of our 
committee?'' There were seven total liberals on the Democrat side and 
two liberals on the Republican side. The committee was 9 to 7 in favor 
of what Senator Kennedy wanted. I said, ``How do I put through block 
grants with that kind of a lineup?''
  I will be honest with you. We did. We fought for them and we were 
able to get some of them through. Some of them were pure block grants 
and they work magnificently. Some of them were hybrids. They were 
partly block grants and partly categorical programs. And some were 
called block grants but were not.
  I give a lot of credit to Senator Kennedy for working with me to do 
some of the things that we did. And they worked. In fact, one of the 
leading liberals in the Congress came to me--in fact, I would say one 
of the three or four leading liberals in the Congress--came to me and 
said, ``Now, don't ever quote me by name''--and I am not--``but those 
block grants work.'' They work. And the reason they work is because we 
do not go through this voracious grab by Federal bureaucracy for 
everything.
  When I see the little bit of money that gets back to the poor from 
the programs advocated by those who share the viewpoint of my friend 
from Minnesota, who has been making these wonderful arguments about how 
deeply he feels about the poor--nobody feels more deeply about them 
than I do--when I see the little amount of money that gets back to them 
once it is laundered through the Federal bureaucracy, where we see all 
these sociologists, all these Ph.D.'s, and all these people who are 
paid pretty high wages as they manipulate, manage, fuss, and bother, 
and work on programs and come up with new ideas every time you turn 
around, when I see how little money gets to those people, I just 
shudder.
  This balanced budget amendment will make the Federal Government more 
efficient. It help us help the poor more. It will make every dollar 
count. And I do not care how liberal you are; I do not care how 
conservative you are. You are going to have to work within a structure 
that requires us to live within our means, or at least go in that 
direction.
  This amendment does not always necessarily require a balanced budget. 
It just puts on a fiscal mechanism which forces us to at least move in 
that direction. Because if you want to increase the deficit, you are 
going to have to have a three-fifths vote to do it. That means 60 
Senators in the Senate would have to vote for any increase in spending. 
If you want to increase taxes, you are going to have to have a 
constitutional majority, which means you cannot do that with less than 
51 actual votes in the Senate and 218 actual votes in the House. Most 
importantly, you are going to have to vote, where now we just hide it 
by voice votes. We just go along with business as usual.
  We do not worry about these things. The fact is this amendment would 
make us worry about these things. It would make us a little more 
concerned about where all the moneys go.
  If there is waste in the military, and we all know there has been--I 
do not think there are any more $600 toilet seats and $500 hammers or 
screwdrivers--but the fact of the matter is, if there is waste, we as 
Members of Congress can no longer blithely ignore that. We are going to 
have to look for it and we are going to have to get rid of it, because 
we are going to have to live within certain economic constraints, which 
is where we ought to be and what we ought to do.
  (Mr. KYL assumed the chair.)
  Mr. HATCH. The poor are being ripped off because, as the 
distinguished Senator from Illinois has said on many occasions, if we 
keep going in the direction we are going, we are going to have to 
monetize the debt. And once we do that, this country's power in the 
world, economic clout in the world, its stability in the world will be 
gone, because nobody will believe in the dollar after that, because we 
will have paid off all these debts with worthless dollars, or at least 
very, very much devalued dollars.
  Now, that is where we are headed unless we do what is fiscally 
responsible, that which Thomas Jefferson indicated he thought we should 
have put in the Constitution from the beginning: That is, put in a 
fiscal mechanism in the Constitution that is not so tight that you 
cannot operate within it, but is not so tight that you cannot have 
unbalanced budgets if that is in the best interests of the country.
   [[Page S1813]] If military spending is not efficient or unnecessary, 
we ought to correct the military. But there are not the incentives or 
the pressures to do that today because we simply spend the money the 
money with virtually no restraint. We just spend the money.
  If we are wasting money on social programs, we ought to correct those 
wastes. But we do not do it today because we just spend the money.
  If there are other programs in the Federal Government that are not 
working and are not as valuable as some programs, we ought to bite the 
bullet and get rid of them. But today we just spend the money.
  Now I have seen for 18 years those who are against the balanced 
budget amendment come on this floor time after time or speak in public 
time after time or on television shows or on the radio, and say, ``We 
ought to have the guts to do what is right here. We ought to balance 
the budget and we ought to do it without a balanced budget amendment.''
  Well, we ought to. But the fact of the matter is, there are not the 
votes to do it. People will not do it because there is no fiscal 
mechanism in the Constitution that requires them to do it.
  So when somebody comes on the floor and says, by the way, they have 
always been an opponent of the balanced budget amendment, and almost 
all of these who are critics are, the new game in town is to say, 
``Show us how you are going to the get to a balanced budget in 7 
years.'' We have three or four plans around here that show that. The 
problem is, we do not have the votes for any one of those plans to do 
it. So nobody in this context can show exactly how we are going to get 
it in the year 2002 unless we have a mechanism that forces us to do it. 
That is what this is all about.
  So when the new methodology to defeat the balanced budget amendment 
is, ``Show us how you are going to get there in 2002,'' I can give them 
20 plans that will show them that. The point is there is no incentive 
or power or force or mechanism to enact any of them in the current 
Congress without a balanced budget amendment forcing us to meet these 
problems.
  So that is why this is important. We do not want to put the cart 
before the horse. We need to pass the amendment. That puts the 
mechanism in that makes Members of Congress make priority choices among 
competing programs.
  I happen to believe that Members of Congress believe in the 
Constitution. I happen to believe that they believe in the oath of 
office that they have taken. I have seen a reverence for the 
Constitution no matter what the philosophy of people in the Congress. 
It is the same in the States. The State legislators revere their 
constitution. We revere ours.
  I do not think it is a naive belief to say if we pass the balanced 
budget amendment and it is submitted to the States and it is ratified 
by three-quarters of the States, that we will do what has to be done; 
we will live within our budget limits; we will force ourselves to 
debate the implementing legislation and how we get to a balanced budget 
by the year 2002, if possible; or we will vote to either increase taxes 
or to increase the deficit, because it cannot be done. But that will 
never happen. But today that type of a debate will never happen--with 
any hope of fruition--unless we have the amendment mechanism in the 
Constitution to force Members to do it.
  Government excess spending is our biggest threat, to our eyes on this 
side of the floor. To the distinguished Senator from Minnesota, failure 
to curtail excess spending in the military is one of the biggest 
threats. Military spending is now the third largest item in the Federal 
budget. The second is that interest against the national debt, that is 
over $300 billion and will approach $500 billion shortly after the 
first of the century if we do not do something now.
  So, this call, to cut military spending without a balanced budget 
amendment, is a fruitless call. Nobody has been able to do it so far. 
We have tried through the statutory methodology. I was sitting right 
back there in 1978, and I remember when we passed the Byrd amendment 
that required the Senate to balance the budget in what I believe was 
1980. Yet, an amendment was offered that required a 51-percent majority 
vote for a balanced budget. This completely subverted the very 
important Byrd measure that had previously just passed by an 
overwhelming vote on the Senate floor. There was no constitutional 
force or requisite to meet that challenge that Harry Byrd made. It went 
down to defeat.
  Then we came up with Gramm-Rudman-Hollings. I cannot say that it did 
not work at all. But in the end it was a simple statute that we did 
away with and changed its goal and timetables. Frankly, it never really 
worked well. And today we are right back where we started. True, with 
the largest tax increase in history, the deficit trend line has gone 
down and will go down until 1996, when it just shoots right straight 
back up again.
  What are we going to do, raise taxes again and solve this problem 
that way? Or are we going to start working on priority choices between 
competing programs in the budget? The only thing that will get Members 
to do that is a balanced budget constitutional amendment. It is not 
because people in Congress are bad people or they do not want to do 
what is right. It is that there is so much pressure to spend here. 
There is so much pressure by every special-interest group in this 
country to cover their problems and solve their difficulties.
  We are sincere. We want to do what is right. But right now we do not 
have to because there is no mechanism forcing Members to consider doing 
what is right. This amendment is a bipartisan consensus amendment that 
we have worked out over a period of almost 10 years now, since we 
passed the first balanced budget constitutional amendment through the 
Senate and lost in the House back in 1982.
  A lot of us, somewhere, worked on it. It is important. A lot of 
Democrats have worked on this. A lot of Republicans have worked on 
this. Any one of us could write a tougher amendment, one way or the 
other. But this is a bipartisan consensus amendment. This is the only 
one that has a chance of passage. It will do the job because it does 
three things. It does more than three things, but three things I want 
to mention. It requires a recorded three-fifths vote to increase 
spending. To increase the deficit, you will have to get a recorded 
three-fifths vote to do so. Once you do that, everybody in America will 
know who voted that way. They may agree with it. But they may not, 
either. And everybody here will have the pressure on their backs to 
determine whether or not it is the right thing for them to do. Today, 
we generally lift the debt ceiling by a voice vote. Nobody wants a 
recorded vote on that issue, and thus raising the debt ceiling has 
become automatic because we do not have a recorded vote.
  Second, if you want to increase taxes, you have to have a 
constitutional majority. That is important. Any legislation could be 
passed here by a vote of 26 to 25 because we have 51 Senators making a 
quorum. Anything else could be passed by less than 51 votes. Once this 
amendment becomes law, the only tax bills that could be passed through 
both Houses will be those bills that get an actual 218 Members to vote 
for them in the House, and an actual 51 in the Senate.
  Third, and I have alluded to this before, we have a recorded vote to 
raise the debt ceiling and there is a three-fifths requirement to do 
so.
  Those are three very important reasons why we should enact this 
balanced budget constitutional amendment.
  Now, there are good worries on both sides of the aisle on almost 
every aspect of this. We can raise all kinds of hairy problems. The 
fact of the matter is that this is a bipartisan amendment, done by 
Democrats and Republicans, which is the only one in history that has a 
chance of passage and, for the first time in the history of this 
country, has passed the House of Representatives. Back in 1982, an 
amendment that was not quite as good as this one passed the Senate by 
69 votes; in other words, 2 more than we need. We have to have 67 votes 
on a constitutional amendment in the Senate.
  I believe this amendment is worthy of passage. I am fighting arm in 
arm with my fellow Democrats who are linking arms with me and with 
others on this side who have worked so hard to try to pass this 
amendment. We are fighting together, side by side, trying to get it 
through. I believe we have a 
[[Page S1814]] chance at doing it if the American people really get on 
the backsides of their Senators and let them know that this is 
something that has to be done. Nothing short of that will get this 
done.
  There are other things I would like to say, but I think there are 
others on the floor who would like to speak to this matter. I defer 
other remarks to a later time. I yield the floor.
  Mr. GRASSLEY. Mr. President, I want to support House Joint Resolution 
1. The significance of the No. 1 is very important. If Members go out 
and talk to people at the grassroots, they think, to have a balanced 
budget, there is a need for a constitutional amendment. They think this 
amendment is the first order of business of any Congress. I think the 
last election said that it ought to be the first order for this 
Congress. It is very simple, particularly for middle-class people in 
America, and the small entrepreneurs and to the farmers of America, 
that Federal spending must be controlled, the deficit eliminated, and 
the national debt brought down.
  There are very important economic reasons to balance the budget, but 
more essentially, there are moral reasons to balance the budget. The 
moral issues, in fact, now, are more important than the economic 
reasons. Early on, I think we could justify the amendment on economic 
reasons, but now the immorality of our generation living high on the 
hog and leaving the bill to our children and grandchildren to pay makes 
it much less an economic issue. We are borrowing the future of our 
children and grandchildren through the bad fiscal policies. We must end 
this practice.
  Because every other means has failed to produce a balanced budget, we 
must enact an amendment to the Constitution. Every other means has 
failed. Gramm-Rudman I and II. I even remember when I was a Member of 
the House of Representatives, I worked very closely with another person 
by the name of Byrd, Harry Byrd, who was a Member of this body, a 
Senator from the State of Virginia.
 He was very much a fiscal conservative. He thought, just pass a law 
that would say that Congress cannot expend more than the taxes raised.

  I was in the House of Representatives at that time, and I worked very 
closely with former Senator Byrd of Virginia to make sure that 
amendment he passed in the Senate would get through the House of 
Representatives. I had to, in a sense, camp out in the Chamber of the 
House of Representatives for about a 2-week period of time to be there 
from gavel to gavel. I knew that the leadership of that body would want 
to avoid the membership being forced to vote upon the Byrd amendment 
when it came over to that body.
  Finally, when they knew I was going to stay in the Chamber of the 
House and force a vote on a motion to instruct, they let it come to a 
vote, and it was overwhelmingly adopted. So in 1978--maybe it was 
1979--we had a law on the books saying that Congress could not spend 
more than it took in.
  But did it do any good? No. The theory is one Congress cannot bind a 
succeeding Congress, and I suppose that is good constitutional law. So 
when we passed the succeeding budget that was out of balance, it was 
then read as overriding the Byrd-Grassley amendment.
  So after that and after Gramm-Rudman 1 and 2, we still did not have a 
balanced budget. Then there were several attempts on my part to merely 
freeze the budget across the board, and I was joined in that effort, 
let me say, by my good friend, Senator Biden of Delaware, and Senator 
Kassebaum. The freeze in and of itself would not have brought about a 
balanced budget in the first year, but in 2\1/2\ years we would have 
had a balanced budget. But we could not get a majority for that. After 
all those efforts, I have become a supporter and advocate for a 
constitutional amendment to require a balanced budget.
  More so than what I have said is my rationale for the constitutional 
amendment is the fact that in my own State of Iowa we have a 
constitutional amendment requiring a balanced budget, and I have seen 
our State legislatures faithfully abide by that, whether controlled by 
Democrats or controlled by Republicans. I think it works. So we must 
enact an amendment to the Constitution because nothing else has or 
nothing else will work. Irresponsible debt threatens our future, not 
just the future of the young people that are our future but the very 
form of our society and the freedom, both political and economic, that 
is an integral part of our society.
  I think the reason we look at it the way we should, as a moral issue, 
is because it threatens our children's future. Our deficits have not 
occurred because Congress has not taxed the American people 
sufficiently. Rather, these deficits have developed because of runaway 
spending. And all you have to do is look at efforts to increase taxes 
to reduce the deficit--and we have had four or five of those in the 
period of time I have been in this body--and the deficit does not get 
smaller. It is still yet larger.
  The reason for that is because the Government not only spends every 
dollar that comes in in taxes, but it borrows another 50 cents almost 
to spend in conjunction with it. So in fact I think lower taxes, less 
income, is one less dollar to have an excuse to borrow another 50 cents 
against to ratchet up spending and ratchet up the deficit.
  Washington has not only been irresponsible, but I think this process 
of our fiscal irresponsibility fosters the wrong values in our society. 
Spending is increased, and the results of the spending have not been to 
accomplish what was promised. Programs which have a philosophy that all 
you have to do is tax and appropriate money and you are going to solve 
a social problem just have not worked.
  We have to stop the immoral behavior of passing along increased debt 
to our children and future generations and get out of this time warp 
that we are in that somehow money spent through the Federal budget or 
the creation of some new program is going to solve our problems.
  A balanced budget amendment fits appropriately within the design of 
the original document because, as the preamble says, the Constitution 
was adopted by,

       We the people of the United States, in order to form a more 
     perfect Union, establish justice, insure domestic 
     tranquility, provide for the common defense, promote the 
     general welfare, and secure the blessings of liberty to 
     ourselves and our posterity.

  ``Posterity'' is a word that we do not hear much anymore. We run our 
Government as if the only relevant considerations are what are in 
today's newspapers, what we do today. We, in elective office, tend to 
be more concerned about the next election just 2 years away than about 
the next generation. We consider the consequences of our acts in short 
timeframes. Rarely do we take account of the effects that our actions 
will have on posterity's ability to enjoy the blessings of liberty in 
the way that my generation has and the way that the preamble presumes 
that our future generations should be able to enjoy the blessings of 
liberty.
  Among the blessings of liberty that our constitutional system has 
maintained is a standard of living that rises with each generation. 
Keys to this enhanced economy have been productivity, growth, and 
investment. In recent years, productivity, investment and savings rates 
have declined with the concomitant negative impact upon the economy.
  The 26-year continuous string of unbalanced budgets has contributed 
to these poor economic results. I do not think it coincidental that the 
stagnation of average wages over the last 20 years has been accompanied 
by high budget deficits by our Government.
  Moreover, economic growth in the last 26 years of counting deficits 
has fallen short of the prior 26 years. Budget deficits have been run 
up to fund current consumption. The effects of these deficits are 
already negatively affecting the budget. When we last balanced the 
budget--and that was in 1969--9 cents of every dollar of Federal 
spending went to payment of interest on the national debt.
  Now, however, 26 cents of every dollar goes toward paying the 
interest on the national debt. We receive nothing for making these 
payments, but we will force future generations to pay an even greater 
proportion of the budget as interest unless we act to pass this 
constitutional amendment, because all the other acts in good faith that 
this body has taken have not produced the desired results of a balanced 
budget.

[[Page S1815]]

  Moreover, we will have to tax future generations at incredibly high 
rates just to pay the interest on the national debt if nothing is done. 
The figures for that problem that lies ahead for future generations 
vary depending on the assumptions made.
  Future generations will pay the vast majority of their lifetime 
earnings in Federal taxes. Various assumptions bring up various 
percentages of two-thirds or three-quarters or even 93 percent that 
future generations might have to pay in taxes just to pay interest on 
the national debt.
  So it is unacceptable that we live high on the hog by masking the 
true costs of the programs while leaving future generations to pay the 
cost, meaning the principal plus the interest.
  That was not done to us by our grandparents or parents or great 
grandparents or any of the 11 generations that we have had. It seems to 
me because it was not done to us, we have even more of a responsibility 
to make sure we treat future generations with the same respect that 
past generations have shown us.
  I am concerned that some people think that the deficit and the 
national debt are issues of declining importance. While it is true that 
the deficit will fall this year, we cannot afford to declare victory 
and stop worrying about the deficit. The deficit will rise in the near 
future by the administration's own estimates.
  Moreover, I believe that the administration's interest rate forecasts 
have been too low. Higher interest rates will only increase the portion 
of the budget spent on interest on the debt. Moreover, deficits 
themselves increase interest rates in the long run, and higher interest 
rates harm renters, home buyers, farmers, and small business people--
maybe everybody who borrows. But it seems to me that it particularly 
hurts those people who have to borrow for need or those people who have 
capital-intensive industries and small businesses to create their own 
jobs.
  Deficit spending has produced other negative consequences. Last year 
at the hearings held on the amendment in the Judiciary Committee, the 
former chief actuary for Social Security testified that deficit 
spending has led to lax Government accounting. If the balanced budget 
amendment were enacted this actuary testified that Congress would 
finally have to start examining Government accounting. Just the simple 
accounting procedures by the Federal Government are way off. There is 
no incentive to correct the procedures as long as the Government can 
borrow and borrow and borrow and not have to meet a legal, 
constitutional requirement of a balanced budget.
 According to his testimony, one account at the Department of Defense 
has been mismanaged for 30 years. The State Department has lost account 
of billions of dollars worth of property. And the Comptroller General 
has said that some Government bills have been paid twice.

  A balanced budget amendment will force us to take a tough look at 
Government accounting as well as Government spending. This is all to 
the good. Rooting out wasteful spending is the best way to make headway 
against the deficit.
  Yes, there is wasteful spending to cut.
  Cutting spending does not have to mean that people will be hurt. We 
have spent trillions on social programs, and the problems remain. In 
many instances, the programs have made the programs worse. As Ronald 
Reagan said, ``We fought a war on poverty--and poverty won.''
  Even when a program has good ends, it is frequently mismanaged. We 
all know how much of the money is wasted on too many bureaucrats, 
regardless of how well intentioned they are or how much work must be 
done. It may be true that there are now fewer Federal personnel than in 
the past 30 years. But does anyone miss the ones no longer there? Has 
anyone's life suffered as these surplus employees have left and not 
been replaced?
  I believe that the worthwhile and important programs could grow at a 
smaller rate, and could be just as effective, if they were critically 
examined and changes made. The programs that do not measure up should 
be eliminated. We can balance the budget this way under the proposed 
amendment. Cutting the Washington bureaucracy is the key.
  Since the deficit itself is a significant problem, why not just cut 
the deficit now? Why enact a constitutional amendment to balance the 
budget? Because, as I hope I made clear, I see no other way. Congress 
has passed statutes to reduce the deficit. Congress has raised taxes 
supposedly to cut the deficit. But the deficit has risen. It rose after 
Gramm-Rudman. It rose after the 1990 budget deal. That was a Republican 
one.
  And in a few years even by our President's own admission, and he is a 
Democrat, his 1993 tax bill and the budget agreement that went with it 
will still not keep the deficit from going up within 2 more years, and 
continue to go up unless we do something more.
  We cannot ever eliminate the deficit if we continue on our present 
path.
  If we are to reduce the deficit, we must put a binding obligation on 
Congress to balance the budget gradually until the deficit is 
eliminated soon after the passage of the amendment.
  Those who believe we can cut the budget deficit down to zero without 
this amendment should offer an effective plan to accomplish the result. 
However I believe that they will not do it. Congress as an institution 
will not cut spending or reduce the deficit unless it is forced to do 
so. And the only force I know is through the Constitution. There is 
plenty of will in this body, but that will is directed toward spending, 
not cutting. It is toward deficits, not toward a balance of the budget.
  We have heard it said that section 6 of the amendment which gives 
Congress the power to enforce the statute is inconsistent with the 
claim that statutes alone will not end the deficit. But there is no 
contradiction. As I have said, in 1978 I was a part of the Byrd-
Grassley efforts by a statute that we got through and signed by the 
President to require a balanced budget. So I think I know. Many 
amendments are given life by provisions extending Congress the power to 
enforce them. This constitutional amendment gives us a basis for what 
was not there when the Byrd-Grassley amendment was law.
  Implementing legislation is necessary to make the balanced budget 
amendment function fully. But the difference between statutes enacted 
under this amendment and Gramm-Rudman, or Byrd-Grassley is that the 
Constitution will demand that the new statutes be adhered to, unlike 
earlier legislation lacking the constitutional imperative.
  Mr. President, we need to balance the budget. We can only do so if we 
pass a constitutional amendment. The American people are watching to 
see if we make this commitment. The quality of the existence of future 
generations is at stake. We cannot afford to fail again.
 We cannot afford to fail making tough decisions today to lighten the 
burden on our children and grandchildren. We must enact this 
constitutional amendment to balance the budget.

  I think this is the fourth time--maybe the fifth time--since I have 
been in the Senate that this issue has come before us.
  We have passed it at least once. It was by two votes. It was defeated 
once by one vote. Another time it was defeated by two or three votes, 
and then a couple of other times we could not get the votes to stop the 
filibuster. I hope this time we will be successful.
  I yield the floor.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Delaware.
  Mr. BIDEN. I am sorry. I did not see the Senator from Colorado. I 
yield time for the Senator.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. CAMPBELL. Mr. President, thank you. I thank the Senator from 
Delaware.
  Mr. President, I too, rise to speak on the balanced budget amendment 
to the Constitution. As a person who has been a prime cosponsor of this 
legislation three different times and on the House side voted for it, I 
am very permanently committed to it. In fact, in the 102d Congress, as 
the Presiding Officer well knows since he was also a supporter when we 
served together over there, we missed it by just six votes. It 
[[Page S1816]] was awfully close. A couple of times before that we both 
signed a procedure in which to take the amendment directly to the 
floor, and we could not even get it out of committee of the 101st 
Congress, as I remember.
  So there have been a lot of efforts to move this along, and basically 
do what people are saying now--that is, save us from ourselves. I know 
in the course of this debate, which may last a week or even 2 weeks, 
there are going to be a lot of efforts to weaken it, lots of efforts to 
get us to succumb to the feeling by some Americans that we really do 
not need to balance the budget, and in fact will hurt jobs or hurt 
individuals. I do not subscribe to that, and would oppose weakening 
this in any way, shape, or form.
  As better speakers before me have already alluded to on the floor, we 
are simply in a downward spiral. Last year, $200 billion was wasted on 
interest payments. As the Senator from Utah said, not one dime of that 
money helped build a square yard of highway, or helped build one cell 
for a hardened criminal, or helped one youngster in need of counseling. 
All we got for our efforts in the last few years was an $18,000 bill as 
they said for every man, woman, and child in America.
  There is no question in my mind--and I think everyone knows--that 
balancing the budget will be perceived as hurting some people in the 
short run. But in the long run balancing the budget will raise the 
Nation's standard of living and the rate of savings. According to GAO, 
a balanced budget by the year 2001 would produce a 36-percent 
improvement in our standard of living by the year 2020.
  OMB Director Alice Rivlin estimates that balancing the budget within 
5 years would raise the national savings rate to 6.1 percent. Yet, if 
we fail to pass a balanced budget, the savings rate will be a mere 3.7 
percent--that certainly means trouble for the United States in a 
competitive global economy where other nations save far more.
  Our voters told us that it is time to draw the line. We know that we 
cannot pass a constitutional amendment to solve every problem. 
Certainly this is not an ordinary problem. This amendment is required 
because history has proven, as other speakers have said, that 
legislation simply will not work.
  I remember very well the days of the Gramm-Rudman-Hollings act in 
which we ended up before we could finally get it passed exempting 
something like 72 percent of all spending and thereby trying to balance 
the budget on the remaining 28 percent of the revenues. And it simply 
will not work. If we make all kinds of exemptions to this legislation, 
this will not work either.
  In an ideal world, this amendment will not be necessary. But, in the 
real world, it is necessary. I do not think that in fact the elected 
officials should take all the blame for it because I know my office, 
like many offices, is inundated with people who say in one breath, 
``Balance the budget, reduce my taxes, and get me $10 million more for 
my special project.'' Those special interests, which we sometimes 
called the third House around here, has had so much influence in 
protecting turf that we simply cannot balance the budget by 
legislation.
  Just look at the recently disbanded Kerry-Danforth bipartisan 
entitlement commission. It spent $1.8 million but failed to come up 
with a unified proposal on where to cut entitlement spending, which is 
the largest sector of Government spending.
  This amendment gives Congress and the public a constitutional reason 
to bite the bullet. Congress will have to bite the bullet--we will have 
plenty of tough choices. Clearly, popular programs probably will be 
cut, and in fact some good programs may be cut. We must make our very 
best effort to concern ourselves with the most vulnerable in our 
society and make sure that they do not get unduly hurt.
  According to most estimates, about $1.2 trillion of spending cuts are 
going to be needed to balance the budget in the next 7 years.
  Already, nearly 50 percent of spending programs have been removed 
from the new leadership's deficit reduction plan--Social Security, 
defense, and net interest.
  In addition, Congress will probably be required to find more cuts to 
offset the middle-class tax cut proposals, and other tax cut proposals, 
that are being circulated around the Capitol.
  Certainly, the challenge is enormous. Congress has a responsibility 
to come up with spending cuts before it passes any tax cuts, and our 
eyes narrowly focused on a balanced budget in 7 years.


                           the right to know

  Congress also has a responsibility to tell the American people how it 
will accomplish a balanced budget before it passes one. That is why I 
support Senator Daschle and Senator Exon in their efforts in the right-
to-know budget amendment.
  Congress must be honest with voters because they have a right to know 
what we already know. Congress cannot allow its knees to buckle at the 
prospect of making spending cuts.
  We have a duty to fill in the blank lines of the promise of a 
balanced budget, so that Americans can understand what it means for 
their lives.


                      three-fifths tax limitation

  Some have suggested that a provision be added to require a three-
fifths approval for income tax increases. I oppose such a provision.
  It would scare away many supporters of last year's version which 
almost passed. We have worked far too long to see this opportunity 
missed.
  I also worry that this provision would allow a zealous minority to 
hijack our Nation's budgetary policies.
  More importantly, I think a three-fifths requirement undermines the 
amendment's flexibility. The amendment should be flexible, able to last 
the ages, and not dictate the path to a balanced budget.
  Congress will pass the balanced budget amendment this year. Passage 
of this amendment will not be the silver bullet to kill the deficit--
only tough choices will do that. I hope we can work together in a 
bipartisan, responsible fashion for a balanced budget and the future of 
our Nation and our children.
  Certainly, the challenge is enormous. Congress has the 
responsibility, and I am certainly willing to step to the plate, as 
many of my colleagues are.
  I yield the floor, and just say in passing that I certainly commend 
both Senator Simon and Senator Hatch, who are going to be spending an 
awful lot of hours here on the floor in the next week, for their 
leadership on this balanced budget amendment.
  Mr. SIMON. Mr. President, will my colleague yield?
  Mr. CAMPBELL. Yes.
  Mr. SIMON. Mr. President, I certainly want to commend the Senator 
from Colorado for being solid on this issue.
  He mentioned the GAO report--which has been largely ignored around 
here--that says if by the year 2001 we balance the budget, by the year 
2020 we will have an average increase, adjusted for inflation, in 
income of 36 percent per American.
  Our choices are very, very striking. I happen to have that report 
here. I would just like to read this:

       Eliminating the budget deficit, and, if possible, achieving 
     a budget surplus, should be among the Nation's highest 
     priorities. Because of the accumulating burden of interest on 
     the mounting public debt, it is important to move rapidly in 
     this regard. Postponing action only adds to the difficulty of 
     the task.

  Again, I want to commend our colleague from Colorado for standing up 
so solidly on this. I really appreciate his leadership.
  Mr. CAMPBELL. If I might say, too, in that report, it indicates that 
because of some severe actions we have taken in the last year or two 
the deficit is going down a little bit now. But, clearly in next few 
years, it is going to start to rise again. What we do legislatively is 
not going to amount to a hill of beans, but it is still going to go up 
without this constitutional balanced budget amendment.
  I look forward to supporting this amendment, and thank the Senator 
for his nice comments.
  Mr. BIDEN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Delaware.
  Mr. BIDEN. Mr. President, I state the obvious. The Senate has begun 
debate on a proposed amendment to the Constitution. This is, as it 
ought to be, a solemn moment in the life of our Constitution, for what 
we debate today, and I expect in the following weeks, is whether to 
change, alter, or modify the basic document of governance that we have 
operated under.
   [[Page S1817]] Since 1791, the year the Bill of Rights was ratified, 
Members of Congress have introduced over 10,000 proposed amendments to 
the Constitution. Admittedly, the new Republican majority is making 
their weight felt here. We have not only this amendment, but I do not 
know how many more to amend the Constitution. But there have been over 
10,000 proposed amendments to our Constitution. Of those 10,000 since 
1791, we in Congress have approved just 22. And, of the 22, just 17 
have been ratified by three-quarters of the States and have become part 
of the Constitution.
  We stand here again this year confronting one of our most profound 
constitutional responsibilities as we consider a change in our 
fundamental charter. It is one of the glories of the U.S. Constitution 
that it has been so resilient. Its authors' insight into human behavior 
and political institutions have proved accurate from our early years as 
an outpost on the coast of the new world to our current status of a 
space-aged superpower.
  Few changes have been necessary to permit the Constitution to keep 
pace with our social, economic, and technological revolutions that have 
transformed our Nation since its founding. But in recent decades, we 
have faced the problem that we do not seem to be able to solve. We 
cannot balance our budget, or, more correctly, we will not. And to put 
it in even sharper focus, I think it is much less important that our 
budget be balanced. There is nothing magic about the budget being 
balanced. But what is critically important is that our deficit continue 
to decline, and that we have a small deficit, if any deficit at all.
  At the beginning of the Reagan administration, we swerved from the 
course that had, since the end of World War II, shrunk the national 
debt, and we turned onto a path that has led us to where we are today; 
the so-called Laffer curve. Speaking of ``Laffers,'' it is probably the 
ultimate ``Laffer''--the ``Laffer curve.'' Many of us have worked to 
impose disciplines needed to restrain the temptation to spend beyond 
what we tax.
  (Mr. GREGG assumed the chair.)
  Mr. BIDEN. When the Reagan administration deficits began, I proposed, 
along with Senator Grassley and Senator Kassebaum--and he mentioned 
this earlier--that we freeze every single solitary program in the 
Government, anything the Government had to do with, every single 
solitary one, that we not spend a penny more, not even accounting for 
inflation, than we spent the year before. Although I wrote the plan 
with my two Republican colleagues, we received very little support from 
either side of the aisle. I think our high-water mark 3 years later was 
38 votes.
  I also supported the Gramm-Rudman process that has been much maligned 
here in the Congress. It has not worked, but I argue that absent that 
things would even be worse than they are today. Gramm-Rudman put caps 
on the amount of deficits allowed and required a balanced budget. But 
the requirements changed every year, and the only constant in the 
process was the annual increase in the national debt and the guarantee 
of annual deficits.
  Those are not the only things that we have tried. Over 10 years ago, 
I offered my own constitutional amendment to balance the Federal 
budget--and you might expect me to say, parenthetically, I think it was 
a superior document to the one we are about to vote on this year. Up 
through my vote for Senator Reid's balanced budget amendment last year, 
I have held that this is an issue worthy of constitutional 
consideration. Many suggest that this is not an issue worthy of 
constitutional consideration.
  Well, the fact of the matter is, I think my friend from Illinois is 
correct when he keeps quoting and referencing Jefferson. If this is not 
worthy of constitutional consideration--how we are able to bind or not 
bind future generations--I am not sure what is worthy of constitutional 
consideration.
  That in no way undercuts the opposing argument that writing fiscal 
policy into a constitution or into a document of governance is a 
difficult and maybe impossible thing. But the notion that this is not 
worthy of constitutional consideration, I think, is not accurate. The 
decision to encumber future generations with financial obligations is 
one that can rightly be considered among the fundamental choices 
addressed in the Constitution.
  But from the first time the resolution before us here today was 
proposed, I have been concerned that it could bring with it problems 
that, taken together, could be almost as bad as the deficit problem 
that we are all worried about. In the Judiciary Committee, I have 
described some of those concerns. This year, in committee a number of 
amendments were offered to fix what I, at least, perceive to be 
problems in this constitutional amendment. Some of us tried to make 
this a better proposal. We tried to avoid tying up the courts with 
constitutional questions about such important details as the 
President's role in enforcing the balanced budget. We tried to keep the 
Social Security trust fund off budget, where it is now and where it 
should stay. We tried to assure that the real cost of the balanced 
budget amendment, and not just its surface lure, is known to the 
citizens who will be asked to ratify this amendment in the coming 
months. We tried to provide a capital budget to treat public 
investments the way families, businesses, and States treat their own 
investments.
  These and other amendments were not accepted. The reason they were 
not accepted--and you will hear it repeatedly; my friend from Utah 
referenced it. It is the one thing that worries me most, as I am one of 
those undecided votes. I am told that there are five, six, seven, or 
eight of us in this place who do not oppose the notion that we have a 
mechanism in the Constitution to deal with deficits. But we are very 
unsure of this mechanism. The camps generally divide into two areas. 
One suggests that it is bad policy, period, to put anything in the 
Constitution. And there are those who suggest that this is the only 
answer. I am with that handful or maybe a couple of hands full of 
people here who find myself believing that it is not inappropriate but 
believing that what we have before us may not do the job. I have been 
here long enough to realize that there are often unintended 
consequences of our actions which are sometimes worse than the problem 
we have attempted to cure.
  Where do we stand now? We have before us the balanced budget 
amendment, about which many of us have expressed serious reservations, 
the effects of which in both the short and the long term cannot be 
predicted with any degree of certainty, although we will find plenty of 
people on the floor who will predict with certainty how they think this 
will work. I think any reasonable person, though, will acknowledge that 
it is almost impossible to predict with a degree of certainty what will 
happen if this passes.
  I hope we can improve the proposal by passing amendments. But there 
is a second refrain you will hear on the floor, I expect, time and time 
again: This is the best we could do. This is the best we could do. We 
have to pass exactly what the House sent to us, because we have never 
been so close before. We have to take what is before us. For example, I 
will, in my opening statement here, make reference to some Governors 
and others who have suggested that a capital budget is a good idea. 
When I ask people why it is a bad idea, the Senator from Illinois gives 
me his well-thought-out rationale why it is not necessary or why it is 
counterproductive. Most others look at me and say: ``We cannot fool 
with this or tamper with this because it is the only game in town now. 
We are getting perilously close, and we cannot change anything at 
all.''
  I respectfully suggest that that is not a very enlightened way to 
deal with amending the Constitution. I cannot say that I am optimistic 
that the improvements, from my perspective, that I and others will 
suggest will be accepted. I fear that there are those who will believe 
that the mere fact that we will suggest improvements is really designed 
to kill the amendment. The truth of the matter is that these amendments 
are designed to make it better. I will speak to the specific changes I 
would like to see. But the changes I suggest will not in any way 
undermine the principle of this amendment and would make it more 
workable, not less workable.
  Whether or not we amend this amendment, Mr. President, this balanced 
budget amendment, may in fact 
[[Page S1818]] change our ways. Perhaps we will use the opportunity of 
a constitutional constraint and make the tough choices to restore 
sobriety to our budget process. I devoutly hope so.
  Of course, it may be that we will decide that the economic and 
political cost of an annual budget balance are not worth the benefits. 
It may be that we will make use of both the legitimate escape clauses 
in this amendment, and other, unforeseen devices to evade the intent of 
the amendment. Mr. President, I hope we do not, if this passes.
  We, quite frankly, cannot be sure that a vote for this amendment will 
have the effect the authors promise. But we can be sure that if we try 
nothing, we will remain on the path that we have been on for too many 
years now, with the notable exception of the last 3 years under the 
leadership of this President. I know the stereotype is that all 
Democrats are big spenders and that all Republicans are conscientious 
with the taxpayers' dollars. Obviously, history does not support that 
conclusion. If we had not had the Reagan budgets that we all voted on--
and we could have stopped them--but had we not had the Reagan budgets 
and that unusual theory of the Laffer curve, we would have a budget in 
balance right now. It's out of balance just because of the interest 
accumulated on and the debt that has occurred as a consequence of the 
Reagan additional deficits--I should not say Reagan--the deficits 
produced by Reagan and the Democratic Congress both.
  But we will hear a good deal of hyperbole on this amendment. Its 
supporters promise that it is a cure-all, and its opponents promise 
that, if it passes, we are going to go to hell in a hand basket rapidly 
and all our liberties will be taken from us. I hope we keep our eye on 
the ball here and at least have an open mind to the prospect that we 
can make this amendment better and still have an amendment.
  We will continue to add every year to the debt burden of future 
generations. We will steal today from the future, squeezing out the 
savings and investments that could increase our future wealth if we do 
not do something about stopping the size of these deficits, even if we 
do not actually balance the budget, if we do not make a change.
  The Senator from Iowa pointed out--I think I heard him say, and I 
stand to be corrected--that in 1969, the last time we balanced the 
budget, for every tax dollar collected, six cents, or thereabouts, went 
to pay interest on the debt,
 and every tax dollar collected in 1993 or 1994--I forget which year he 
used, maybe it was 1991--but anyway, every tax dollar collected in the 
last year or so, 29 cents, I believe was the number he gave, or 26 
cents, goes to pay interest on the debt.

  I am sure someone has looked out over the next 15 years and concluded 
that if we stay on the track, even the one predicted by the President 
of the United States, that we will be requiring an increasingly larger 
share of every tax dollar just to pay the interest on the debt.
  And to me that is the driving force behind this amendment. To me, the 
beginning, middle, and end is not whether there is a mechanism that 
guarantees a balanced budget amendment. It is not whether or not there 
is any magic about it being actually in balance. It is not whether or 
not we come close. It is about that increasingly larger proportion of 
the tax dollars collected going for the most useless investment of 
paying interest on the debt.
  When I introduced my budget freeze proposal years ago, the liberals 
of my party said, ``It's an awful thing you are doing, Joe. All the 
programs we care about, you are freezing them--money for the blind, the 
disabled, education and so on.''
  My argument then is one I make now, which is the strongest, most 
compelling reason to be for this amendment--or an amendment--that if we 
do not do that, all the things I care most about are going to be gone--
gone. So what do we have? We end up with essentially a net reduction in 
the programs that I cared about over the last 10 years, a net increase 
in other programs, and a net increase in the portion of the budget that 
goes to pay interest on the debt.
  So the people I care most about--the reason I ran for public office 
in the first place--are the people that got hurt the most in this 
process and are likely to get hurt the most because they are the 
weakest in our society. When an interest group like the PTA comes down 
here to support money for education, and other interest groups support 
money for tax expenditures for major businesses, I have no doubt who is 
going to win that fight. I have no doubt how that is going to turn out.
  So if this debt continues to increase, we will continue to tie our 
hands and our ability--indeed, our responsibility--to set national 
priorities in our annual budget process because of the interest on the 
debt required to be paid every year.
  This year, the interest on the national debt will cost us $235 
billion. The entire domestic discretionary budget will be $253 billion.
  Now we use phrases like that ``discretionary budget,'' and my staff 
writes that stuff in. And I keep telling them nobody in the world but 
people in this Chamber and inside the beltway know what ``discretionary 
budget'' means.
  Let me translate. The discretionary budget includes everything from 
the FBI to education, from help for the mentally retarded to the 
Library of Congress. That is everything. Everything out there that 
people think is the place where we are wasting money, that people think 
is the place we can cut to cut the deficit, does not include Social 
Security, does not include entitlement programs, does not include 
interest on the debt. The point is, it is all those things that 
everybody when I go home who says, ``Joe, if you just cut the waste in 
Government''--if we shut down every department in the Government, we 
would in effect have an inability to balance the budget in the outyears 
because we are already talking about interest on the debt equaling 
almost the same amount of money of all the money we spend on the 
Government for what the average person thinks are Government 
expenditures. They do not usually think of Social Security as a 
Government expenditure. They do not think of the things we generally 
talk about as the big-ticket items here as expenditures.
  By the time this amendment is intended to become law, in the year 
2002, the interest on our debt will be $344 billion, larger than every 
other category in the budget except Social Security. That is just 
interest on the debt.
  If we do nothing, our inability to control the growth of debt, and 
the cost of carrying that debt, will tie our hands, preventing us from 
shifting resources to meet changing needs, which is the essence, in my 
view, of responsible budgeting, responsible Government.
  So, Mr. President, the question before us today and in the coming 
weeks is not the simple one: ``Are you for balancing the budget or 
not?'' Under most circumstances, everyone would agree we should balance 
our books.
  No, it seems to me Mr. President the question is: ``Does our repeated 
failure to balance the budget necessitate a response that all of us 
agree is extraordinary?'' And that is amending the Constitution.
  It is by no means that clear that the amendment before us will 
eliminate deficits. It certainly will make deficits more difficult--
which in and of itself is a worthy undertaking--but with a three-fifths 
vote, we can in fact continue to borrow.
  And I hope no one is under the delusion that by hook or by crook some 
future Congress, less virtuous than we, will not be able to find ways 
around the restrictions in this amendment.
  With little faith in human nature, but a healthy respect for human 
ingenuity, we should have no delusions on that count.
  I think both the supporters and the opponents of this amendment quite 
frankly overstate the case, though.
  I expect the supporters of this balanced budget amendment will, as 
they already have, proclaim it as a panacea that will cure a structural 
defect in the way that a democratically elected legislature weighs 
fiscal responsibility against the demands of constituents. The 
supporters will proclaim its passage as the end of deficit spending.
  The opponents of this amendment may agree that it will drastically 
change our Government, but, they will argue, for the worse. I expect 
they will describe the pain that the deep cuts will cause to the 
American people--the elderly, the poor, the military, the 
[[Page S1819]] farmers, and the rest who depend on Government--and 
paint a bleak picture of life under a balanced budget regime.
  I say to my colleagues on both sides of this debate that all these 
claims overstate the case.
  This amendment will not magically cause deficits to disappear. The 
hard work of cutting must still be done--and it should be done by us.
  This is hard work. Evidence the fact that everybody acknowledges that 
the President's budget package reduced the deficit, yet everyone went 
out last year and ran on this gigantic tax increase. It increased it 
only for the very wealthy. The middle-class taxpayers paid no more. In 
fact, they got reductions in some cases. And those who were low- or 
middle-class income taxpayers with children, they got an actual 
reduction in their taxes.
  But yet this thing, this horrible thing we did, which touched the top 
1 percent of all the taxpayers in America in any meaningful way, was so 
horrible and so bad--even though, by the way, in that same document the 
President said and we voted that we would freeze spending; we would 
freeze spending in all these other categories--it was so bad the other 
side could not even muster up the courage to give one single, solitary 
vote for reducing the budget deficit by a half-trillion dollars over 
the outyears. And the deficit went down. It actually went down.
  Yet, if they could not muster the courage for that vote--which 
obviously cost a lot politically because if you notice there are fewer 
desks on this side of the aisle than there are on that side of the 
aisle; obviously they were right, politically anyway. If they could not 
muster the courage for that vote, how are we going to find over $1 
trillion to cut?
  I mean, this is incredible. It is incredible the degree of self-
delusion you will see us all engage in over the next couple days, the 
next couple weeks. But this amendment will not magically cause deficits 
to disappear.
  Nor will this amendment turn democratically elected officials in 
Congress, as the opponents say, into hardhearted authoritarians who 
will ignore the cries of their constituents. That is what my friends 
opposed to this amendment basically will say.
  Even under this amendment, the economy will falter and need shoring 
up. That is going to happen no matter what we pass. I do not think 
anyone can tell me that this amendment is going to take us out of the 
cycles we have been in for the of the past 200 years, particularly the 
past 60 years. The economy will falter at some point and it will need 
shoring up.
  Foreign dictators will rattle their swords and we will be called upon 
to respond by spending billions of dollars to send armies somewhere.
  Rains will fall and plains will flood, and Federal disaster relief 
will be called for, to the tune of billions of dollars. I remember 
when, in the section of the country of my friend from Illinois, he and 
others were in here pleading that we should continue to reroute the 
Mississippi and every other river in America and we should reimburse 
people for that disaster.
 And most Members stepped up to the ball and helped. Now our friends on 
the west coast are accurately pointing out that there is billions of 
dollars worth of damage because of earthquakes and fires and floods and 
rains. Are such natural disasters going to stop? Is anyone going to 
suggest that this balanced budget amendment will send a message to God, 
as well, and say, ``OK, God, we balance our budget, now you hold off 
from here on.''

  Our population will age, and the need to support the medical and 
social needs of those who supported us when we needed it will not 
diminish. It will grow. Costs will grow. And on and on and on and on.
  I predict that from time to time--perhaps more frequently--three-
fifths of Members in Congress will agree that some need of our people 
is so great that we will agree that this year we will not balance the 
budget, or this year we will screw up the courage to have people pay 
for what they say they want through the Tax Code.
  I realize, incidentally, that is a horrible thing to suggest. I 
always find interesting, everything that we hear about the balanced 
budget--with the notable exception of my friend from Illinois and a few 
others that are the chief sponsors of this--is always in terms of ``cut 
spending.''
  Whatever happened to the old conservative discipline about paying for 
what you spend? Paying for what you spend. I thought that meant that if 
we spend, then we ought to tell people how much it will cost to spend. 
If they do not want Members to spend, then we should not spend. But if 
they want to spend, we should be honest, must tell them what it will 
cost.
  Which brings me to the argument raised by some that before passing 
this amendment we should tell the American people how we intend to 
balance the budget. There are those who claim that this is just a sham 
on the part of the opponents of the balanced budget amendment. Well, I 
am not an opponent of that amendment, but I want to tell Members it 
does not seem to be unrealistic for someone to lay out in broad details 
at least how it will work. Those people say, ``Wait a minute; if you 
are for the balanced budget amendment, you ought to say how to balance 
it.'' Most people who are against the balanced budget amendment are not 
saying that we have to balance the budget; they are saying that our 
budget should be somewhere around 19 percent of GNP, that we should not 
put ourselves in the position where we are out of whack. They argue, 
like many economists, that balancing the budget in and of itself is not 
a sacred undertaking and could be counterproductive.
  It seems to me that we should tell the American people. I look at the 
polls out there. For example, I want to go on record, and I am up for 
reelection this year, and I will remind everybody what I did at home, 
which will cost me politically. When I argued that we should freeze 
Federal spending, I meant Social Security as well. I meant Medicare and 
Medicaid. I meant veterans benefits. I meant every single solitary 
thing in the Government. And I not only tried it once, I tried it 
twice, I tried it a third time, and I tried it a fourth time.
  Somebody has to tell me in here how we are going to do this hard work 
without dealing with any of those sacred cows, some deserving more 
protection than others. I am not quite sure how you get from here to 
there. I am sure that we should tell the American people straight up 
that such an amendment is going to require some big changes.
  The balanced budget amendment will not end our deficit in one fell 
swoop, nor will it cause our Nation to turn its back overnight on those 
who depend on us. All it means, as the Senator from Utah said, is that 
we will have to stand up more often and be counted on these things. I 
find that a good thing, not a bad thing.
  As we begin this debate, let Members keep a decent perspective on the 
true consequences of this amendment. It is important that we not 
overstate nor overpromise what the amendment will do. Let Members 
debate this amendment with all the seriousness that a constitutional 
amendment requires, to ensure that the amendment we propose to the 
States and the American people merits the honor of being included in 
our most fundamental covenant of self-rule.
  So what, then, are the concerns that many Members, those so-called 
undecided voters, bring to this debate?
  First and perhaps foremost, it seems to me we must examine whether 
the amendment is likely to shift the balance of power between the 
branches of Government to an extent never experienced or expected by 
our forefathers. It was the wise position of the drafters of the 
Constitution in 1787 that the Congress, being the most representative 
branch, the most democratic, and the most sensitive to--and ironically 
that is why we are needing this amendment. Everybody should not lose 
sight of that. We say that Congress is not responsive, and that we 
should be more responsive to people; and then we are told the reason we 
need this amendment is we are too responsive to the people. Whatever 
they come and ask for we give to them in a painless way. Kind of 
fascinating how we sort of turn these arguments to whatever benefit the 
moment allows.
  The fact is we are the most representative branch. We do respond to 
the people, and that is how we were supposed to respond based on what 
our Founders intended. And we are the 
[[Page S1820]] most democratic and most sensitive to the public needs.
  Because of all that, the drafters of the Constitution spent a lot of 
time debating this little point on the second floor in Philadelphia, 
because they did not want the debate to take place on the first floor. 
They were afraid people would eavesdrop and hear what is going on. This 
was before ``Government in the sunshine.'' The delegates to the 
Constitutional Convention sat in the second floor so people could not 
walk by and eavesdrop. What they were saying on the second floor is, 
``Look, if we are going to give the power to tax and spend, we better 
give it to the outfit that will most directly respond to the people. 
Taxes, we will give that to those guys in the House that get elected 
every 2 years. We do not want the Senators--who were not popularly 
elected in those days--to do that. They can only respond to a tax bill 
proposed by the House.''
  So there was a real solid reason why, in setting out the balance of 
power, taxing and spending was put in the Congress. James Madison, who 
is recognized as the father of the Constitution, called this power of 
the purse ``the most complete and effectual weapon with which any 
Constitution can arm the immediate representatives of the people for 
obtaining a redress of every grievance and for carrying into effect 
every just and salutary measure.''
  That power of the purse has remained with the Congress for over 200 
years. This amendment threatens to take away a good deal of that power 
and to share it with the President, a fundamental shift of authority 
that will irretrievably alter the balance of power established in the 
Constitution.
  Senators might say, well, how, in fact, does this amendment threaten 
to shift the power to the President? Because, I am convinced, 
Presidents will seize on the language of this amendment to claim a 
constitutional power to impound; that is, to refuse to spend money that 
Congress has duly appropriated. This power to impound would give the 
President wide-ranging authority to undo or redo Congress' spending 
priorities without limits, or at least so a President would claim.
  Now, you may say no President will do that, Joe, and as a Democrat I 
am happy that this guy downtown is of my party. I am sure he would not 
do that. But let me ask you, what do you think Nixon did? What do you 
think old Lyndon Johnson would have done? What do you think Franklin 
Roosevelt would have done with his power? Now, maybe we are not going 
to have any more Roosevelts--I hope that is not true--or Johnsons or 
Nixons, but we just may very well.
  What does it mean for a President to wield this power? It means the 
President could decide to change the way the Congress had allocated 
funding in spending bills; for example, taking away money that ensures 
that small States get their fair share. Let me be parochial for a 
moment. I am a Senator from Delaware, one of the smallest States in the 
Union, the fifth smallest population in the Union.
  When we pass bills here to make sure that all persons benefit, 
whether they live in New Hampshire or Delaware or Utah or Wyoming or 
Alaska or other small States, we sit and we make sure the formulas we 
write into the bills do not let all of the money go just on a per 
capita basis. We usually get together--and there are probably somewhere 
between 18 and 20 of us, that is, States who find themselves in that 
position. Well, if the President gets to the end of the line here, the 
budget is not in balance, we have not passed a balanced budget--I might 
add we will not know whether or not this will be in balance as we go 
along because it is based upon predicted revenues. So we spend based on 
predicted revenues. That does not account for emergencies. That does 
not count significant downturns in the economy, or a lot of other 
things that come into play.
  But if, at the end of the line, we pass a budget that we thought was 
in balance but, in fact, was out of balance, that means the President, 
under this amendment, arguably, could say, ``That is my job. I will 
redo this.'' I know what I would do if I were President and I wanted to 
balance the budget. I would pick off the smallest States and cut the 
moneys that were allocated for them. They are the least powerful in 
Congress. They cannot do much. They do not have that many 
Representatives. Over here, because we make up a minority, we might 
find ourselves in difficulty.
  Now maybe a President would not do that. But he would have that 
power, under the amendment. The President could change detailed policy 
set by Congress; he could conclude on his own that Congress put, for 
example, too many military bases in South Carolina or Kansas or was 
spending too much on medical treatment in Utah or Mississippi.
  Do we really want to give the President that kind of power?
   I think not.

  Along with this power to spend, according to Walter Dellinger, a 
noted constitutional scholar and now the President's top constitutional 
adviser, this amendment could even be construed to give the President 
the power to levy taxes, to raise needed revenues. I think that is much 
more unlikely, quite frankly, although it is arguably possible.
  Do we want to give the President that kind of power? I do not think 
we do.
  In committee, I supported Senator Kennedy in offering an amendment to 
make it absolutely clear that the balanced budget amendment is not 
intended to shift to the President a major piece of Congress' 
historical power to tax and spend.
  Not a single one of my colleagues that I am aware of disagreed with 
the point of the amendment. Nobody disagreed with the point of the 
amendment. Some said not to worry, it cannot happen, or it probably 
will not happen, or it is unlikely to happen. But everyone acknowledged 
that if it happened, it would be a bad thing. And yet a majority, all 
the Republicans and a couple of Democrats, voted en bloc to defeat this 
amendment claiming it was not necessary, that after-the-fact 
legislation could take care of the problem, the so-called enabling 
legislation.
  I sure would like to know that before we pass this. I would like to 
know whether or not a President can do that. Why do we not just make it 
clear that Congress has the power to resolve any discrepancy between 
spending and revenues that is left at the end of the year--the 
Congress, not the President.
  Now, maybe that is what the Congress will do. Maybe the President 
will not over-reach. But I have never seen, as a student of history, 
any time where there has been a vacuum in power created that the 
administration, Democrat or Republican, has not stepped in to fill. And 
I have seen very few times when the Congress on its own volition has 
stepped up to the ball to fill a vacuum when filling the vacuum would 
require them to make hard decisions. And so I do not think it is 
unreasonable to suggest that future Presidents may seek this authority 
to impound.
  It's not necessary to spell out in the amendment that the President 
should not have this power? Well, I say that a principle as important 
as preserving the balance of power should be stated as plainly and 
boldly as possible in the balanced budget amendment itself.
  Now, as we debate this, I will be happy to hear anyone say that the 
President should have that power. I suspect everyone is going to say he 
should not and this amendment does not give it to him.
  Well, if that is true, what is the big deal of including it in the 
amendment? It is not inartful. It can be artfully done. It does not 
ruin the symmetry of the amendment. It does not go to the heart of 
whether we have to balance the amendment. It merely says we are not 
going to shift the balance of power, no doubt about it.
  Our Constitution, that durable and flexible document, has endured for 
over 200 years. The chief reason it has endured is because the self-
correcting checks and balances that have kept one branch from 
dominating the other have been maintained. In the days to come, I will 
support, if not offer, efforts to modify this amendment to ensure that 
in addressing this important issue we do not risk undoing 200 years of 
history.
  The second concern that I have is not a constitutional one. It is a 
very practical one but no less important for that fact. The balanced 
budget amendment makes no provision for a capital budget to pay for 
long-term capital improvements. This amendment will require 
[[Page S1821]] the Federal Government to pay for capital improvements--
roads, bridges, schools, aircraft carriers, all of which are designed 
to last for decades--on a pay-as-you-go basis.
  Now, this is not the way States or local governments or our families 
or businesses, for that matter, treat these sorts of long-term items. 
No. All of these recognize that it is permissible, even prudent, to go 
into debt to pay for long-term items such as a house, a factory, or a 
road or an aircraft carrier. State and local governments that are 
required to balance their budgets every year are permitted by their 
balanced budget rules to set up capital budgets. They are permitted to 
borrow money to pay for long-term capital items even though they must 
balance the rest of their budget.
  Now, we hear the phrase used all the time: ``States do this; why 
can't we do it?'' States do not do this. If you look at the numbers, 
the total accumulated debt of the States over a comparable period for 
the Federal Government over the last two decades, the States have 
increased debt more rapidly than the Federal Government--almost a 2-to-
1 margin.
  So before you get on the floor and pound your chest about how your 
State balances its budget, say how would your State balance this budget 
if it had the same exact amendment as this.
  Now, some States may. Mine does not. Mine is a little tighter, quite 
frankly, but we are smaller and we are more manageable. Most States 
that have balanced budget amendments do not, do not, in fact, balance 
their budgets. They have a capital budget which allows them to go in 
debt. I believe the Federal Government should have the same ability to 
borrow to pay for capital items as State and local governments do and 
that we should amend the balanced budget amendment to assure that we 
give proper weight to our long-term needs.
  I am not alone in this view. The Wall Street Journal editorial page, 
that bastion of conservative thought, has criticized the balanced 
budget amendment because it lacks such a capital budget. Here is what 
the Wall Street Journal had to say.

       To understand the economics, start here:

  Referring to the balanced budget amendment.

       Start here. If all American households were required to 
     balance their budgets every year, no one would ever buy a 
     house.
       Of course, households don't think about their budgets that 
     way; they figure `balance' means meeting their mortgage 
     payments. Similarly, State and local governments with a 
     ``balanced budget'' requirement can still borrow money for 
     capital improvements.

  So I say to everyone here in the gallery as they walk out and say, 
``We balance our budget; why doesn't the Federal Government do it the 
way we do,'' well, unless you are a very wealthy person--even then it 
would not be good economics to do it this way--unless you are a very 
wealthy person and paid cash for your house and paid cash for your car, 
you do not balance your budget. You do not balance your budget like 
this amendment requires it to be balanced.
  I want the Federal Government to have to balance their budget the way 
households have to balance their budgets, the way States have to 
balance their budgets. And that is with a capital budget. I have a 
capital budget--I have a mortgage on my house. I have a capital 
budget--well, I do not have a capital budget on my car, but most 
people, when they buy a new car, have a capital budget. I meet that by 
paying as everyone does and the States do, paying on it monthly, in my 
case, and the States yearly, the cost of that borrowing and the 
principal. We pay it down. We pay it off. But the Federal budget, under 
this amendment, would not allow that.
  Now, Gov. Mike Leavitt of Utah, a prime supporter of enacting the 
balanced budget amendment, testified before the Judiciary Committee 
that his State has a capital budget provision and recommended that we 
look further into the question before enacting House Joint Resolution 
1.
  My own Governor, Gov. Tom Carper, former Congressman of 10 years here 
in Washington, the strongest supporter from my delegation for a 
balanced budget amendment, a Democrat, told our Constitutional 
Subcommittee the same thing last year.
  But despite that good advice, this balanced budget amendment does not 
follow that almost universal practice of capital budgets because it 
fails to set up a separate capital budget for major physical 
improvements. It will surely mean less of those improvements, or we 
will make those improvements and we will further cut in other areas of 
the budget or raise taxes in other areas of the budget which will cause 
more great pain, when the more reasonable way to do it would be to do 
it the way the States and households do it. After all, if families 
could not borrow to pay for their houses, there would be many fewer 
homeowners. And if States could not borrow to build their roads, there 
would be many fewer roads.
  Why enact a balanced budget amendment and fail to distinguish between 
projects that merit long-term financing and those that should be funded 
from year to year? Under this balanced budget amendment, the incentive 
will be to focus only on those spending priorities that have short-term 
payoffs, economically and politically. That is not good for rebuilding 
the infrastructure of this country, which we all say we have to do to 
compete internationally. Because that is where the political pressure 
will come.
  If, in my State, they come to me and say why do you not vote to spend 
more money for the Corps of Engineers that will allow them to dredge 
the Delaware River and the Port of Wilmington, why do you not do that 
versus spending more money for drug treatment programs.
  I know when I hear a mallet going down; I can tell it.
  I yield to the President, obviously.
  The PRESIDING OFFICER. Under the previous order the hour of 12:30 
having arrived, the Senate will stand in recess until the hour of 2:15.
  Mr. BIDEN. Mr. President, I ask unanimous consent, unless it is 
contrary to a standing rule, that I be able to take 10 more minutes to 
finish my statement, unless someone objects to that.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BIDEN. We used to do that in the bad old days when the Democrats 
controlled.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BIDEN. Without a capital budget provision, I fear, this amendment 
could skew the way we spend money, and in a way that could hurt the 
long-term future investments this country needs. It does not have to be 
this way.
  In committee I offered an amendment to provide for a capital budget. 
It was modeled on the capital budget provisions in the States, 
including my own State of Delaware.
  My amendment established a capital budget for major public physical 
capital investments. It limited that budget to 10 percent of total 
outlays--about what the Federal Government has spent on such items in 
recent years. It required a three-fifths vote of both Houses to place 
any item within that capital budget.
  My amendment was not designed to build a loophole into a balanced 
budget amendment. Under my amendment, it would not be easier to treat 
an item as a capital budget item as opposed to a current item. It would 
be harder. It would require a three-fifths vote. But it would be right.
  My amendment failed in committee. Without a capital budget provision, 
I fear that, not right away but as the years go by, this amendment may 
skew the way the country invests for the future and we may be able to 
balance our budget in the end, but we will not spend our money as 
wisely as we should.
  A third concern about this balanced budget amendment relates to the 
way this amendment treats a program that is arguably the most important 
and most depended-upon program in the Federal Government.
  I am talking about Social Security. As we all know, the Social 
Security trust fund is designed to spread costs over many years of 
caring for working people after they retire. We pay in today, so 10 or 
20 or 40 or 50 years from now we can live out our lives, knowing that 
we have that minimum Social Security payment.
  The Social Security fund is not supposed to be in balance every year 
or even every 10 years. It is meant to be 
[[Page S1822]] balanced over the decades. As this generation of working 
people pays its Social Security taxes the Social Security trust fund is 
gathering in a surplus of tens of billions of dollars. Because the 
Presiding Officer and myself and others are of a generation that is the 
baby boom generation, or just before that generation, we pay in tens of 
billions of dollars in excess of what is drawn down by present Social 
Security recipients--my mom and dad and my uncles and aunts. So there 
is a surplus. A surplus of $100 billion will be paid in each year, more 
than is taken out, around the year 2000--$100 billion surplus.
  Right now $60 billion more is paid in this year by those of us paying 
our FICA tax than is paid out to Social Security recipients--$60 
billion. My mom and dad think that money goes into an account. They 
think that is over there for Social Security. A lot of people in my 
generation who in 15 years will be eligible for Social Security think 
that money is being put in an account. Guess what, folks? We are 
spending it. We are spending it now.
  But before the year 2014, that Social Security trust fund will have 
generated a great surplus. But after 2014, we will have substantial 
deficits. The reason for that is that the baby boom generation will be 
collecting Social Security and my sons and daughter will be paying into 
it. There are fewer of them than there are of us. So fewer people will 
be paying in and more people will be taking out. It sounds like I am 
stating what is obvious to everyone but it is not obvious to everyone, 
obviously. The fact of the matter is, after the year 2014 we will be in 
deficit in the Social Security System.
  The balanced budget amendment makes no provision whatsoever for the 
unique characteristics of the Social Security trust fund. Instead, it 
treats Social Security revenues and outlays as ordinary Federal budget.
  This means in the years that Social Security is generating hundreds 
of billions of dollars in surplus revenues it will be used to cover 
hundreds of billions of dollars worth of deficits that the rest of the 
Federal budget is creating.
  After 2014, when the trust fund goes into deficit to the tune of tens 
or hundreds of billions of dollars a year, we in Congress will have to 
cut that much from the rest of the budget to make up for the deficit.
  What does it mean? It means that for the next 20 years or so, 
revenues from the Social Security trust fund will make it look like we 
have balanced the budget when in fact we have not, and after that the 
huge outlays from the trust fund will force drastic reductions in the 
rest of Federal spending, or drastic reductions in Social Security. And 
that means the pain of cutting will be delayed by years from the 
effective date of this amendment, but it will be that much sharper when 
it comes.
  So we should get Social Security out of this mix, make it clear that 
the balanced budget amendment does not deal with Social Security, it is 
not able to use the surpluses and not deal with the deficits. We should 
be more honest about it with people because Social Security is at 
stake, in my view.
  For all the reasons I have stated I supported Senator Feinstein's 
amendment in the Judiciary Committee to keep Social Security right 
where it is now: off budget. The Feinstein amendment recognizes Social 
Security is not designed to balance its budget every year but over the 
years, and it recognizes we cannot honestly balance the rest of our 
Federal budget if Social Security and its huge swings are included. It 
recognizes that Social Security is a unique institution that deserves 
unique protection.
  The fourth concern I have is this amendment will shift power to the 
large States at the expense of small States. By imposing supermajority 
requirements of three-fifths on both Houses it permits a minority of 
two-fifths plus one to block an unbalanced budget, no matter how 
necessary for our fiscal and economic health it may be. This minority 
veto could be marshaled by representatives of just the five or six 
largest States in America. If the five or six largest States in America 
get together and agree on something that they need that the rest of the 
States do not want, they can prevent us from acting on a national 
emergency by all of them voting as a block--just six or even five of 
our 50 States.
  The fifth and final concern is that nothing in this amendment forces 
Congress to begin the work of cutting the budget before the year 2002, 
the first year we require. What will happen when Congress tries to 
balance the budget all of a sudden in fiscal year 2002? I fear it will 
be cause an economic disaster. This amendment ought to have some 
mechanism to guarantee our Government and our economy moves toward a 
balanced budget on a ``glide path,'' a gradual descent in the deficit 
that will get us to a balanced budget without forcing a crash landing 
in the final year. But this amendment does not do that. It is possible 
it could be done by enabling legislation but I would sure like to see 
it.
  In the days ahead I and my colleagues will be offering amendments to 
address these and other legitimate concerns. I hope these amendments 
receive the full debate they deserve. There are none in this body, I 
hope, who will argue that an amendment to the Constitution is not 
worthy to receive that full and open debate.
  Under the watchful eyes of our forefathers and with the humility that 
this awesome task engenders, as the debate unfolds in the days to come 
I will listen to my colleagues, I will support amendments designed to 
improve this amendment, and I will urge my colleagues to do the same.
  I hope at the end of the process I will be able to do what I intend 
on doing now, and that is to vote for a balanced budget amendment.
  I thank the Chair for its indulgence and I yield the floor.
  Mr. HATCH. Mr. President, I would like to respond to the comments of 
Senator Biden. Although Senator Biden has enunciated many reasons for 
and against the balanced budget amendment, I want to respond to an 
amendment he intends to proffer, one he made at the Judiciary Committee 
markup on Senate Joint Resolution 1.
  This proposed exemption for so-called capital investments could help 
evade the purpose of the balanced budget amendment or make it 
substantially more difficult for future Congresses to make capital 
investments. I confess that I am not certain of the purpose of the 
amendment as it is drafted. It appears to be a provision at war with 
itself. The first sentence seems to encourage capital investments by 
taking it out of the balanced budget rule. But the last two sentences, 
seem to be designed to discourage capital investments.
  I believe such an exemption raises real problems for five reasons.
  First, this provision opens up a loophole in the balanced budget rule 
and unduly limits Congress' ability to make capital investments. There 
would be a powerful incentive for Congress and the President to help 
balance the budget by redefining more programs as capital investments. 
A gimmick capital budget exemption could actually endanger capital 
investments as fake investments crowd out real capital investment.
  Furthermore, the 10-percent limit ties the hands of future Congresses 
which may choose among the competing programs to fund more capital 
investments than this limit would allow. With all the talk about the 
need for infrastructure investment from my friends on the other side of 
the aisle, I am surprised they would want to tie Congress' hands this 
way. A future Congress may justifiably decide to make greater 
investments in this area.
  Moreover, I do not understand what the three-fifths vote requirement 
adds to the amendment other than to make it procedurally harder for 
Congress to make any capital investments, regardless of their effect on 
the deficit. If a given capital investment were to create a deficit and 
had support of three-fifths of the Members of each House, it could be 
passed under the balanced budget amendment as it stands without this 
amendment. If a capital investment was paid for and did not increase 
the deficit, I do not know why the proponents of this amendment would 
want to require a three-fifths vote to make that investment. For what 
possible purpose would we want to discourage future Congresses from 
enacting such investments?
  The proponents must think that a large part of our problem is that we 
spend too much on ``major public physical capital investments'' as 
opposed to 
[[Page S1823]] simple transfer payments or social programs. Apparently, 
whatever three-fifths of the membership of future Congresses think, the 
proponents of this amendment believe that in no case should the United 
States invest more than 10 percent of its budget in ``major public 
physical capital investments.'' Otherwise, I see no reason for this 
amendment. It is surely a mistake to put such limits on future 
Congresses.
  Second, the loophole problem is aggravated by the fact that there is 
no standard definition of a capital budget. For example, in President 
Clinton's proposed fiscal year 1995 budget, OMB lists four broad 
categories of programs that may or may not be considered capital 
expenditures--OMB, Analytical Perspectives, Proposed fiscal year 1995 
Budget, p. 114. Even within those four broad categories there are 
questions about what programs should be included. The amendment's 
attempt to cure the definitional problem only raises new definitional 
problems. The definition given is circular. And just what does ``major 
public physical capital investment'' mean? Each term is subject to 
substantial debate. It is particularly inappropriate to place capital 
budgeting in the Constitution when there is no agreement on what 
constitutes a capital budget.
  Third, the Constitution is not the place to set budget priorities. 
The balanced budget amendment seeks to create a process in which 
programs compete for a limited pool of resources. A constitutional 
amendment should be timeless and reflect a broad consensus, not make 
narrow policy decisions. This exemption creates in the founding 
document a new constitutional budget subdivision with a percentage cap 
and a procedural limitation on using it. We should not place technical 
language or insert statutory programs into the Constitution and 
undercut the simplicity and universality of the amendment.
  Fourth, a capital budget exemption is unnecessary. Total Federal 
spending has generally been above 20 percent of GDP, and less than 4 
percent of Federal outlays are for nondefense physical investment, one 
of the possible definitions of ``capital investment''. Given the 
relatively small and constant share that such capital expenditures have 
in a very large Federal budget, there is no need to remove capital 
expenditures from the general budget.
  One example illustrates the lack of need for a capital budget. 
Although President Eisenhower initially proposed that the Federal 
Interstate Highway System be financed through borrowing, Congress 
decided to keep it on budget and finance it through a gas tax at the 
suggestion of Senator Albert Gore, Sr. We are unlikely to have a 
capital expenditure of this magnitude again. But if we do there is no 
reason to create an exemption for such investment or to limit the 
percent of the budget that goes for such investment.
  Fifth, capital spending should compete in the budget like all other 
spending. The balanced budget amendment seeks to foster an atmosphere 
in which Congress prioritizes spending options. Senate Joint Resolution 
1 does not prevent the creation of a separate operating and capital 
accounts, but any implementing legislation which creates such separate 
accounts must leave the total budget in balance, since implementing 
legislation cannot subvert the clear mandate of the amendment. And such 
accounting techniques should not subvert prioritizing function of the 
amendment. The proposed exemption allows the entire budget to be used 
for noncapital investment, like simple transfer payments, and then 
allows a 10-percent increase in Federal spending--and debt to fund it--
for capital investments. The General Accounting Office saw the fallacy 
implicit in this exemption when it said, ``The choice between spending 
for investment and spending for consumption should be seen as setting 
of priorities within an overall fiscal constraint, not as a reason for 
relaxing that constraint and permitting a larger deficit.''
  To the extent that the three-fifths vote requirement for capital 
investments replicates the general provisions of the balanced budget 
amendment, this amendment is simply pointless. To the extent it goes 
further, it is a meritless straitjacket on the competition between 
legitimate spending options in the overall budget process.


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