[Congressional Record Volume 141, Number 25 (Wednesday, February 8, 1995)]
[Senate]
[Pages S2311-S2324]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

  The Senate continued with the consideration of the joint resolution.


                           Amendment No. 236

   (Purpose: To protect the Social Security system by excluding the 
        receipts and outlays of Social Security from the budget)

  Mr. REID. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Nevada [Mr. Reid], for himself, Mr. 
     Daschle, Mr. Dorgan, Mr. Conrad, Mrs. Feinstein, Mr. Ford, 
     Mr. Harkin, Mr. Heflin, Mr. Graham, Mr. Kohl, Mr. Baucus, 
     Mrs. Boxer, Mr. Hollings, Ms. Mikulski, and Mr. Leahy, 
     proposes an amendment numbered 236.

  Mr. REID. Mr. President, I ask unanimous consent that further reading 
of the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       On page 3, line 8, after ``principal.'' insert ``The 
     receipts (including attributable interest) and outlays of the 
     Federal Old-Age and Survivors Insurance Trust Fund and the 
     Federal Disability Insurance Trust Fund used to provide old 
     age, survivors, and disabilities benefits shall not be 
     counted as receipts or outlays for purposes of this 
     article.''.

  Mr. REID. Mr. President, this amendment is being offered on behalf of 
the Senator from Nevada, Senator Reid, and Senators Daschle, Dorgan, 
Conrad, Feinstein, Ford, Harkin, Heflin, Graham, Kohl, Baucus, Boxer, 
Hollings, Mikulski, and Leahy.
  Mr. President, this is a very simple amendment. It really is. It will 
take some time during the next few days to talk about this amendment. 
But it is an amendment to determine what we are going to do about 
Social Security. In effect, this amendment excludes from the balanced 
budget amendment the Social Security trust fund as it relates to the 
old-age pension aspect thereof.
  Mr. President, I rise in support of the balanced budget amendment. If 
Social Security is excluded, I will vote for the balanced budget 
amendment. As a veteran of a number of debates in this body on this 
issue, I am fairly well versed on persuasive arguments for the balanced 
budget amendment. There are people who I have heard--including my 
friend, the senior Senator from Utah--over the years make very, very 
persuasive arguments why it is important that this country have a more 
sound fiscal policy and why it is necessary to have a balanced budget 
amendment. Some would say in debating this issue--that is, whether we 
should include Social Security or exclude it from balanced budget 
amendment--that it is a very painful vote, and it perhaps is. This body 
would be forced to make a determination as to whether or not the 
proceeds of Social Security, and the old-age pension aspect thereof, 
would be excluded from this balanced budget amendment when it would 
become part of the Constitution.
  Mr. President, we have all been called upon as legislators, and those 
who served as Governor or Lieutenant Governors in States or mayors of 
cities, to make decisions that are difficult sometimes. I remember one 
of the most difficult decisions I had to make as a Senator in this 
body, which I was relating to my friend, the senior 
[[Page S2312]] Senator from New Mexico, and my colleague, the junior 
Senator from New Mexico, regarding whether a stealth wing should be 
taken out of the State of Nevada. We had spent the taxpayers' money in 
this country--about one-half billion dollars--building the secret air 
base in the deserts of Nevada to test this very exclusive weapon, which 
was the Stealth fighter bomber. There came a time when it was no longer 
secret, and therefore the Pentagon made the decision that they would 
move this Stealth fighter wing from Nevada to New Mexico. It was a 
difficult decision. It involved many, many jobs, several thousand jobs, 
something that was very important to Nevada. But I made the decision 
that, if the GAO would tell us that it would save this country money to 
move that wing and that we would be just as secure, I would not object.
  The General Accounting Office came back in a relatively short period 
of time with the report that it would save money and we would be just 
as strong as a nation if this wing were moved to New Mexico. I 
swallowed hard and watched the wing move to New Mexico without raising 
a hand to stop it.
  Yesterday, I received a call from some of my friends in Nevada that 
the President's budget called for the elimination of a facility we 
have--the Bureau of Mines--in Reno doing research. There are not as 
many jobs, but a job is a job.
  These are some of the things we have to make decisions on, and it 
appears to me that it is sound fiscal policy to consolidate. And 
perhaps that is the best thing for the country to do. We all have to 
make tough decisions.
  This amendment is a tough decision. If we ever are going to balance 
the budget of the United States, there will have to be a series of very 
difficult decisions made as to how we will do that. This is different 
than a simple statute that we are going to amend. It is different 
because we are talking about not passing a law; we are talking about 
amending the Constitution of the United States.
  Over the years there have been in this and the other body about 4,000 
attempts to amend the Constitution. As we know, very, very few have 
been accomplished. This is not one of those amendments that is done for 
press releases to be sent home. This is not an attempt made to satisfy 
a certain constituency. This is a serious attempt to put language in 
the Constitution of the United States that would force us to balance 
the budget. We all know that we have the legal authority to balance the 
budget right now. But over the decades we have not done a very good job 
doing that, and, therefore, a majority of the people of this body feel 
that we should amend the Constitution of the United States to include 
in there a provision mandating a balanced budget. I say a majority. I 
think we do not know yet that there will be a supermajority; that is, 
67 votes to make this a part of the Constitution. I say now as I have 
said before, if Social Security is excluded, I will be one of the 67. 
If it is not, I will not.
  I emphasize the U.S. Constitution because, Mr. President, it is 
unlike States balancing their budgets. In the State of Nevada, for 
example, we just completed the construction of a new State building in 
Las Vegas. That building cost about $400 million. But, no, that is not 
a part of the budget that is talked about every year as being a 
balanced budget in the State of Nevada. The reason that it is not is 
because they have bonding authority. Many capital expenditures are 
taken off budget.
  This amendment that we have before this body is more stringent than 
the laws and the constitutions of most all States. Most all States, as 
I mentioned, do not balance their budgets as they say they do because 
there are capital expenditures which are off budget.
  This amendment has no smoke and mirrors. If this amendment passes, 
everything will have to be balanced. This will be much different than 
when most of us handle our personal lives. If we own a home, we make 
payments on it. Most of us, if we have a car, we make payments on the 
car, refrigerators, things of that nature. But, if this amendment 
passes, this will not do that. This is not a smoke and mirrors 
amendment by any stretch of the imagination.
  Mr. President, I think that it is important that we recognize that 
budgeting decisions, assuming we are working on a balanced budget 
amendment, will necessarily include all of our operating expenses and 
all of our capital expenditures. That is the legislation that is now 
before this body.
  So I repeat, with all due respect for States that say they balance 
their budgets, ours would be honest and truthful budgeting, I think 
more so than has ever been done at any level of government. Senate 
Joint Resolution 1 guarantees a balanced budget. It does not spell out 
how we will get there, and I am disappointed that the amendment that we 
just voted on a couple of hours ago failed.
 I think it would have been nice had that passed. I think it would have 
given the American public a glidepath of how we are going to arrive at 
the balanced budget by the year 2002. But that is not what happened. We 
were only able to get 44 votes.

  The amendment to the Constitution that is pending before this body is 
a rule without any exceptions. I believe this balanced budget amendment 
will ultimately pass because the American people want it to pass. 
Indeed, Mr. President, according to a recent ABC-Washington Post poll, 
well over 80 percent of the American public wants a balanced budget 
amendment to pass. However, when these same people were asked in a 
subsequent poll, would they want the budget balanced by using Social 
Security trust funds, the answer was a resounding 90 percent no.
  Mr. President, I offered this amendment about a year ago. At that 
time, I did not know that the American public felt about this the way 
they did. Had any of us known, there may have been a lot of other 
people offering the amendment. But we have learned subsequent to last 
year that the American public feels very strongly about protecting 
Social Security. I raise this issue not because decisionmaking should 
or ought to be guided by the polls. I believe it should not be, and I 
think we in political life--at the Federal, State, and local level--
follow the polls too much. As my staff will tell anyone who will 
listen, I am not a believer in polls. Very, very infrequently do I do 
polling.
  Rather, I raise this issue because much of the rhetoric in the 
balanced budget debate revolves around carrying out the demands of the 
American people. How often have we heard someone say that the American 
people are demanding passage of the balanced budget amendment and 
Congress ought to pass it? Well, I think in that same breath we should 
recognize that they are also demanding action to guard against 
unilateral raiding of the Social Security trust fund to balance the 
Federal budget. Passage of the amendment that is now pending before 
this body is the only sure-fire assurance that such action will not 
occur.
  Mr. President, we have heard a lot of promises being thrown around 
during the balanced budget debate. It should not come as a surprise to 
anyone that in this Chamber and in the other body individuals have said 
that they will fight against any cut of Social Security. We have some 
special interest groups that are saying the same. That is to be 
expected. There seems to be universal agreement that Social Security 
should not be used to balance the budget. This agreement, I believe, 
transcends party lines. Democrats and Republicans alike support 
protecting Social Security.
  I have found it interesting to read the Congressional Record, Mr. 
President, to see what others are saying about Social Security. When 
this debate transpired in the other body, I believe it was on the 25th 
of January of this year, a number of people said a number of different 
things. I had the pleasure of being able to serve in the other body for 
a couple of terms and found it a most enjoyable experience. I say that 
the turnover there has been significant, and I do not know a lot of the 
people that now serve in that body.
  However, Mr. President, one of the men that spoke on this issue, one 
of the Members of Congress that spoke on this issue is the Congressman 
that replaced the former chairman of the Ways and Means Committee, 
Congressman Rostenkowski, by the name of Flanagan. Here is what he 
said, among other things:

       The committee shall do nothing to increase Social Security 
     taxes or reduce benefits to achieve that goal.

  [[Page S2313]] That is, balancing the budget. That is what he said.
  We have another Congressman by the name of Funderburk, who stated:

       The balanced budget amendment will protect Social Security 
     because there will be no more borrowing from the trust funds, 
     which truly protect our Nation's retirees.

  Mr. Hayworth stated:

       One of the previous speakers was quite correct to point out 
     that before there was this contract--

  Meaning the Contract With America that we hear so much about.

     there was enacted a solemn contract with the American people, 
     and we call that Social Security.

  Mr. Wamp indicated:

       We can achieve a balance without touching Social Security. 
     Our party and our leadership are on record opposing cuts in 
     Social Security, and so am I.

  Mr. Chambliss, from the eighth district of Georgia, said:

       Mr. Speaker, let us send a message of assurance to seniors 
     of this great Nation.

  He, of course, is referring to Social Security not being touched.
  Mr. English of Pennsylvania said:

       At a time when some are talking about a new covenant, we 
     should signal our intent to protect Social Security for those 
     who participate.

  Mr. Young of Florida--and I did not have the pleasure of serving with 
any of the Members I have mentioned until now. I served with Mr. Young 
of Florida. He said, on January 25 of this year:

       It reaffirms what I have long said and supported, that in 
     reducing the Federal budget deficit we should look to cutting 
     spending in those areas which are driving our Nation deeper 
     into debt. That certainly is not the Social Security trust 
     fund, which actually runs an annual surplus--last year $61 
     billion.

  I could go on with other statements about how Members of the other 
body talked about the balanced budget amendment. They do not want 
Social Security to be affected by the balanced budget amendment. They 
are right. It should not be.
  What my amendment does, Mr. President, is put into writing what we 
have now only as an oral promise. This disagreement that is the subject 
matter of this debate seems to center on how best to protect those 
trust funds. I believe that if I were trying this case to a jury of my 
peers, the jury would return a verdict in favor of this amendment in a 
matter of minutes. This would not be one where the jury was hung up or 
one where they deliberated a long period of time. I would suggest that 
the debate clearly favors, and will favor, the amendment that the 
Senator from Nevada has offered, along with 14 of his colleagues.
  Why, Mr. President, do we need to express exemption? Very simple. 
Anything less would be insufficient. If we want to take this off budget 
and exempt it from efforts to balance the budget, it must be done in a 
binding fashion. I suggest that burying it in implementing legislation, 
as was suggested last week in another debate, is like passing a sense-
of-the-Senate resolution; it has no binding effect. It makes us feel 
good but, essentially, it is a nonbinding resolution. This language 
will specifically exclude Social Security.
  I also submit, Mr. President, that we will hear some debate here on 
this amendment that will be offered by the senior Senator from Alabama. 
He, having been former chief justice of the Alabama Supreme Court, is a 
person who has had long experience on the Judiciary Committee of the 
Senate and somebody we look to for legal advice. He is the Judiciary 
Committee's legal scholar. He is going to tell this body why this 
amendment is essential. If we do not have this amendment--you will hear 
from the Senator from Alabama--Social Security must be included in the 
receipts that will be necessary to balance the budget.
  Hiding a Social Security exemption in implementing legislation, as I 
said, is like playing a shell game with the American people. It is the 
proverbial smoke and mirrors trickery. It is the fig leaf that we have 
heard so much about, or whatever other words that you can connote that 
is a coverup. That is what, in effect, implementing legislation would 
be.
  Some want to have their cake and eat it, too. They want to say, 
``Well, we are going to protect Social Security, but we are also going 
to vote for the balanced budget amendment.'' I am not going to do that.
  Some want to be able to go home and tell their constituents that they 
voted against touching Social Security. And they may even get by with 
it for a year or two, but it will not be long, because you will have to 
go after Social Security. And we know that, even if it is more than a 
sense-of-the-Senate resolution but a statute that says you want Social 
Security, you have the argument from my friend from Alabama, the senior 
Senator, but you also have the argument that there is no place to go. 
You would have to do that.
  So, it sounds good, but it is really not what I believe is factual.
  So I predict the majority of the American people will see through 
this what I believe is a charade and recognize this proposal, in fact, 
in implementing legislation is offered as a real fig leaf.
  I want people within the sound of my voice to understand a little bit 
about the history of Social Security.
  Mr. President, I first learned about Social Security as a little boy. 
I was born and raised in a very small town in the southern tip of the 
State of Nevada, a place called Searchlight, Nevada. When I grew up, it 
was a town of less than 250 people. A lot of the Reids lived there. We 
made up a significant number of the people that lived there. One of the 
Reids that lived there during that period of time was my grandmother. 
Her name was Harriet Reid. She was born in England.
  My grandmother--I can picture her very clearly in my mind's eye, even 
though she has been dead for many years--was a very short woman and 
very, very fat. She had trouble walking, and to do her work was very 
difficult. She had raised eight or nine children.
  Now, Mr. President, I was a little boy in the late 1940's, but my 
grandmother got, every month, her old age pension check. That is what 
she called it, ``My old age pension check.'' That check gave my 
grandmother, Harriet Reid, it gave her dignity, it gave her 
independence. Even though she had children that would help her, that 
check was a message to everyone that she could make it on her own. She 
deserved to make it on her own. She worked hard.
  So I see Social Security in the eyes of my grandmother. And I believe 
that this amendment is offered on behalf of Harriet Reid and other 
grandmothers and grandfathers to be.
  I believe it is important that we understand the reasons for placing 
this exemption on this balanced budget amendment. My reason, as I have 
just explained, stems from personal reasons and a deeply held 
conviction that the integrity of the Social Security system will be 
violated unless we do this.
  (Mrs. HUTCHISON assumed the Chair.)
  Mr. REID. In 1935, Social Security passed. It passed, Madam 
President, because the American people wanted it to pass. It was really 
at that time, perhaps, an experiment. We did not know if it really 
worked, but it did work.
  I believe we have heard a lot about the Contract With America. I 
think that most all the items that my friends are talking about with 
the Contract With America are good and will help the country.
  But let us be realistic. The real, valid first contract with America 
was Social Security. That program has been in existence for 60 years. 
That is the real contract. And it is a contract that has worked and we 
should do everything we can to protect the Social Security trust funds.
  We should do that, Madam President, not only for the Harriet Reids of 
the world, but also for those children that are now in their beginning 
years, because we need to provide security for them in their old age, 
also.
  President Roosevelt and Members of Congress recognized in 1935 that 
by financing the program by earmarked payroll taxes, we would ensure 
that a future President and Congress could not morally or politically 
repeal or mutilate the character of the program.
  Interestingly, Madam President, President Roosevelt's fears were 
realized in the early part of the 1980's, when there were attempts made 
to make sweeping cuts in Social Security. Those cuts were repulsed by 
Congress. But Congress came back right away, came back quickly and 
solved the problems that they were having with Social Security.
   [[Page S2314]] It was truly a bipartisan commission--Claude Pepper, 
the man who was known for protecting Social Security; Tip O'Neill, 
President Reagan, all these people got together and figured out a way 
to save the Social Security old age pension. And they did a good job. 
Social Security was not damaged in any way. It was renovated. It was 
revamped.
  And we are now celebrating the benefits of that, recognizing that 
last year there was over $60 billion in surplus, this year over $70 
billion in surplus, and those surpluses will continue to increase.
  So the arguments for defending the Social Security trust funds are 
rooted in the history of the program and that is what is truly unique 
about our Social Security system. I believe that, in part, it is 
because of the structure of the system that Social Security is really 
like a contract. This is not a giveaway program. This is not welfare 
that Social Security recipients receive. But, in fact, the employers 
and the employees pay in about 12.5 percent of their salary to put into 
a trust fund so that they have some moneys in their later years. So, it 
is their money. They have earned it. They have paid their dues. They 
have played by the rules.
  And if you want to know why those of us in Government refer to this 
as the so-called third rail of politics, that is why. People trust that 
their funds will be there upon their retirement. It is understandable 
why so many are willing and have fought so hard and so long to maintain 
the integrity of this trust fund.
  As they used to say in an old advertisement--I believe it was Smith-
Barney, or one of those companies that sells stocks and bonds--they 
make their money the old fashioned way, they earn it. That is, in 
effect, what Social Security recipients do and have done.
  So our obligation as Members of Congress is to recognize the 
contractual nature of the system and take the necessary steps to honor 
that agreement.
  Madam President, our contractual obligation to the people of this 
country as it relates to Social Security is similar to the obligation--
of course, our obligation is on a much larger scale --that I had when I 
practiced law.
  I had to set up a separate trust fund to put my clients' money in. 
When I did that, I could not draw any of that money out for anything 
other than my clients' needs. I could not pay my rent, could not pay my 
car payment, house payment, rent on the office. I could only use those 
moneys for my clients. I had a fiduciary duty to my clients to protect 
those moneys.
  While lawyers, people who work in banks, and insurance companies 
recognize the consequences of a fiduciary duty, attorneys are well 
aware of the consequences they face for breaching this duty.
  Any person who violated this fiduciary trust, if they were an 
attorney, would be disbarred. If they were an insurance agent, they 
could have their license taken away. A real estate agent, the same 
thing. Or they could go to prison. They could go to jail. We have an 
obligation to protect the integrity of the Social Security trust funds. 
We, too, have fiduciary duty to protect the integrity of these funds, 
not only as I have mentioned for the seniors of this country, but for 
all working men and women.
  Madam President, what is this word we are throwing around--fiduciary 
duty? What does it mean? Why does it describe Congress' role in 
maintaining the Social Security trust fund? I thought it would be 
educational to me--and it gave me an opportunity to look at one of my 
old law books--to talk about from a level perspective, what is a 
fiduciary duty? It means a person holding the character of a trustee 
with respect to the trust and confidence involved in it and the 
scrupulous good faith and candor which it requires; a person having a 
duty created by his undertaking to act primarily for another's benefit 
in matters connected with such undertaking. This came from Black's Law 
Dictionary.
  It explains that a breach of fiduciary responsibility would make the 
trustee--and that is what we are--liable to the beneficiaries for any 
damage caused by such breach.
  So, Madam President, what penalties do we face for breaching this 
duty? I am sorry to say, not much. I will not be disbarred. I will not 
have a complaint filed against me with the National Bar Association. 
The only opportunity that someone has to get back at a Member for 
breaching our fiduciary duty is in the ballot box.
  I think they need more protection. I think there needs to be more 
stringent control of the Social Security trust funds than somebody 
saying, ``If you violate your fiduciary trust, we will vote against 
you.''
  My amendment expressly exempts the Social Security trust fund from 
any calculation of Federal deficit. Absent an expressed exemption 
included in the constitutional balanced budget amendment, we, the 
guardians of the Social Security trust fund, will be in breach.
  Unfortunately, Madam President, for the tens of millions of 
beneficiaries who have paid into this system most all their working 
lives, they will have no remedy. They can have recourse at the ballot 
box. Sometimes that comes too late. That will not compensate them in 
dollars for their lifelong contribution to the Social Security trust 
fund if we, in effect, raid this fund to balance the budget. It 
certainly will not help their retirement. The cold, hard fact of the 
matter is the beneficiaries have a right, but are without a remedy, to 
ensure that that right is enforced.
  I have said the real contract with America is Social Security. And it 
is like a contract. There are many good reasons why the protection of 
the Social Security trust fund is so important to all Americans. Social 
Security is a unique Government program. The program is not, however, 
difficult to comprehend. Yet its simplicity, I think, Madam President, 
masks the strong undercurrents of emotions so often espoused when 
discussing this Social Security system.
  People feel so strongly about this issue. Why? Because it involves a 
contractual agreement that they know that they have with the 
Government. The Government and the American people. That is the 
contract.
  How many Members have been at town hall meetings where people stand 
up and say, ``Are you going to protect Social Security?'' How many 
times have people stood up at Social Security meetings and they say, 
``I am not on welfare. I have worked hard all my life. I want to be 
able to draw my Social Security. Are you going to protect that?''
  Why is it a contract? This is a word that has been thrown around by 
people in Government and pundits over the last several months. If we 
stop and think about it, Social Security, I repeat, is best described 
as the true contract with America. It is a contract, or, in other 
terms, an agreement, that benefits all Americans.
  I have mentioned how we pay into that system. I have mentioned how 
people who receive that money are not receiving a Government giveaway. 
They are not collecting money for no reason. I am sure that no one 
enjoys the Social Security payroll deductions that we suffer through on 
our paychecks. It is a lot of money. There is an understanding that in 
many ways this produces a greater good. We are, in effect, building. We 
are being forced to build a nest egg provided for us in our golden 
years. That does not seem to be stretching the point at all.
  To attack Social Security as another Government giveaway program is a 
straw man. It is a self-financing, self-sustaining, publicly 
administered contributory retirement program. This program requires 
personal sacrifice. Through the Federal Insurance Contributions Act, 
which we call FICA, workers are required to contribute, as we have 
talked about, 6.2 percent, which is matched by another 6.2 percent by 
the employers, for 12.4 percent. That is a lot of your paycheck.
  By law, the funds are required to be held by the Federal Government 
in trust. The key to understanding this system, however, rests in the 
recognition that all of these dollars that are amassed, the billions 
and soon to be trillions of dollars do not belong to the Federal 
Government. They are contributions workers and employers are paying in 
and the workers expect to get back.
  Our role as Members of this august body is to ensure that there be a 
continued vitality of these funds. I believe, in this respect, our 
greatest obligation is to ensure that retirees receive their 
[[Page S2315]] just compensation. That could apply to people who are 5 
or 6 years old. We have to ensure that they receive their moneys, as we 
do someone that is presently drawing Social Security. I say again that 
unless we expressly exempt the Social Security trust funds from any 
calculation of Federal deficit, we may not be able to meet that 
obligation. Social Security, Madam President, does not contribute to 
the Federal deficit.
  Throughout this debate we have talked about rights and obligations, 
both present and future. I support a balanced budget amendment to the 
Constitution of the United States because I believe that we have an 
obligation to do a better job of balancing the budget than we have been 
doing. This obligation is owed importantly to future generations of 
future Americans.
  The balanced budget amendment must ultimately provide for a 
government to act in a more fiscally responsible manner. If we do not 
handle this amendment properly, and my belief if we do not exclude 
Social Security, we will be not only violating a fiduciary violation 
that we have, we will be fiscally irresponsible. We must not, through 
this amendment, loot the Social Security trust fund in order to 
eliminate the Federal deficit. This is not fair to the generation which 
has paid into the system their entire lives, nor is it fair to the 
generations in the future that will pay into the system their entire 
lives.
  In short, because Social Security does not contribute to the Federal 
deficit in any way, it should not be used to eliminate the Federal 
deficit.
  Madam President, we have a chart here. I referred to it as the 
Government looting chart, and we have another entitled the same. There 
have been some who have suggested that the Social Security trust fund 
should be referred to as the Social Security slush fund. But without 
name calling, we will look at this chart. This chart shows the 
surpluses as they will accumulate until the year 2002, significant 
amounts of money, over $700 billion.
  We can look at this chart in a different way. It will accomplish the 
same fact and perhaps it is a little more graphic, Madam President, to 
see the dollar amounts here.
  What we would do is show it in this manner. This is how those funds 
are going and should be allowed to accumulate. If we do not have an 
exemption--that is, if my amendment does not pass--in 2002 we will pull 
this chart out and it will be all white because the moneys will have 
been used to balance the budget. That will be a shame.
  There is no question that the Social Security trust fund surpluses 
are masking the true size of the deficit. In 1995--that is this year--
we will take in about $70 billion more than we pay out in benefits out 
of the Social Security trust fund.
  By the year 2003, Social Security will be running surpluses far in 
excess of $100 billion a year. By not exempting Social Security in the 
constitutional balanced budget amendment, the smoke and mirror games of 
Congress would simply hide the true deficit problem. Again, the key 
here is that to the extent that Social Security does not add to the 
deficit, it ought not be used to eliminate it.
  I, again, refer to this chart that shows what should accumulate, if 
nothing else happens, in the next 7 years and the amount of money, 
Madam President, that will accumulate during those 7 years in dollar 
amounts--over $700 billion, almost a trillion dollars. That should not 
be used to balance the budget.
  I stated an hour ago on this floor, and I will state again, some have 
said, ``We will have implementing legislation that we are not going to 
do it,'' and in the House what they did, they had a concurrent 
resolution saying, ``We won't affect Social Security. Why won't you 
just accept it as our word?'' I say that every person who voted for 
that in the House of Representatives, they certainly have no intention, 
I hope, of raiding the Social Security trust fund, but the resolution 
they passed is meaningless.
  Why am I concerned about Social Security? I am concerned about Social 
Security because that is where the money is, that is where we have 
looked before to help balance the budget. I repeat, Willie Sutton, a 
famous bank robber, got out of jail and they asked him, ``Why did you 
rob banks?'' And he said, ``That's where the money is.''
  Social Security is where the cash cow is for this Government. Funds 
are running in surplus. We have an obligation to protect that cash cow 
so when people draw down on the Social Security trust fund, they will 
be able to have a check rather than an IOU.
  If we do not pass this amendment, this really is a case of robbing 
Peter to pay Paul. Further raiding will certainly occur unless we 
protect this trust fund.
  In the late seventies and early eighties, Congress changed the way 
Social Security was financed. I mentioned that--Claude Pepper, Tip 
O'Neill, President Reagan. The change was a result of Congress' 
recognition of the large demand on the system that would be created.
  I should include that the Republican leader was in on that. He was at 
that time the majority leader of the Senate. This change is the result 
of Congress' recognition of a large demand on the system that would be 
created by the retirement of the baby boomer generation. Accordingly, 
the Social Security system was changed from a pay-as-you-go system to a 
system that accumulated large surpluses now to prepare for the vast 
increase in the number of retirees later.
  Unfortunately, rather than saving these large surpluses, Congress has 
used them to finance the deficit. This fiscally irresponsible behavior 
is putting us on a collision course toward catastrophe.
  Madam President, during the Vietnam war, for the first time, the 
Social Security moneys were used to mask the deficit being developed as 
a result of that very unpopular war. So we have had experience in 
Congress of using Social Security moneys to mask the deficit.
  In the year 2012, Social Security--maybe a little after that, maybe 
2015, maybe 2020--Social Security is going to have to start drawing 
down. We need to accumulate these huge surpluses now for payout later. 
I served on the Entitlement Commission, a bipartisan group that was 
charged to look at entitlements, chaired by Republican Senator Danforth 
and Democratic Senator Kerrey from Nebraska. We all know that Social 
Security is going to need some adjustment, but let us do it on the 
basis of Social Security, let us do what we have to do with Social 
Security, and not have it when we get around to needing to do something 
and there is no money there.
  The problem we are facing is clear. Unless we begin saving Social 
Security surpluses, unless we begin addressing the needs of the system 
as it stands on its own, we will be leading, I believe, to financial 
Armageddon. That is where we are going if we do not exempt Social 
Security from the balanced budget amendment.
  Specifically exempting Social Security does not mean that we are 
sweeping under the rug, under the carpet, any problem. In fact, we are 
making the situation very clear. The situation is this: We want to 
balance the budget; we want to exclude Social Security trust funds. We 
are saying the reason we need a balanced budget amendment is because we 
are not strong enough, we do not have the courage to do what we have 
the right to do under the law presently.
  If we are saying that, and that is one of the reasons that is being 
put forth and has been put forth for a long time as to why we need a 
balanced budget amendment, it seems to me that that same logic would 
dictate that, Members of Congress, you had better protect Social 
Security because otherwise you will not have the courage not to spend 
those moneys. It would be a lot easier to spend Social Security 
surpluses than to raise taxes or to cut programs.
  So we are not sweeping anything under the rug. In fact, we are making 
very apparent what our problem is.
  There are few people who will deny that Social Security has some 
problems that we need to take care of in the long run, but it is in the 
long run not the short run. Including Social Security in a balanced 
budget amendment may further exacerbate its already identifiable 
problem. How should we treat Social Security under the Federal budget?
  Congress has been struggling with the problems associated with 
Social 
[[Page S2316]] Security for many years. Historically, however, Madam 
President, there seems to be strong congressional intent to protect 
Social Security. An example of this is how Social Security is treated 
in the Federal budget.
  In 1990, Congress excluded Social Security from calculations of the 
budget and largely exempted it from the procedures for developing and 
controlling the budget. Its removal from the budget has not changed how 
its funds are handled.
  Since Social Security's inception, its taxes have been deposited in a 
Federal Treasury and expenditures have been paid from the Treasury. The 
surplus is credited to trust funds.
  As I have already mentioned, Social Security has not always been 
considered off budget. In 1969, Social Security and other programs that 
operated through trust funds were counted officially in the budget. It 
was a tax bookkeeping gimmick. This was done administratively and not 
by an act of Congress because we did not have a budgetmaking process at 
the time. Today, there is strong speculation that the reason it was 
placed on budget is the reason I have already stated, that in 1969 when 
the Vietnam war was escalating and it was costing a lot of money, we 
needed to mask that deficit.
  There were new changes in how Social Security was treated under the 
budget in 1974. Under the Congressional Budget Impoundment and Control 
Act, Congress adopted procedures for setting budget goals through 
passage of an annual budget resolution. Like the budgets prepared by 
the President--like the one that we received yesterday or the day 
before--these resolutions were to reflect a unified budget that 
included trust fund programs such as Social Security.
  By the late seventies, Social Security, as we already talked about, 
faced some new financial problems, and Congress had to deal with the 
increasing cost to the program. So in 1980, 1981, and ultimately in 
1983, there were benefit cutbacks. At the same time, though, the 
Federal budget deficit remained very large. There was growing concern 
that the cuts in Social Security were being proposed for budgetary 
purposes rather than for programs that needed to be maintained.
  Congress responded to these concerns by passing a series of measures 
in 1983, 1985, and 1987. In addition to other things, we made Social 
Security a more distinct part of the budget. Points of orders were 
allowed to be raised against budget bills containing Social Security 
changes. This was a large step forward.
  By the end of the eighties, Social Security began realizing 
surpluses, as we talked about earlier today. As a result, Congress 
passed the Omnibus Reconciliation Act of 1990. This excluded Social 
Security from the calculations of the budget and exempted it from 
procedures for controlling spending.
  The 1990 Budget Enforcement Act put an end to abuse of Social 
Security trust funds by declaring them off budget.
  I think it is interesting to note, Madam President, that that 
legislation to exclude Social Security trust fund calculations from 
deficit calculations passed by a vote in this body of 98 to 2. That is 
not a close call. This body went on record in October 1990 to exclude 
Social Security trust funds from the deficit calculations by a vote of 
98 to 2.
  Putting Social Security on budget contradicts clearly Congress' 
intent. It is clear that Social Security's treatment under the Federal 
budget has been complex; I acknowledge that, and at times confusing; I 
acknowledge that, but Congress has recognized that it is a misuse of 
the Social Security trust fund to place it on budget. It is a misuse 
because it jeopardizes the integrity of the program.
  Now, off-budget status of these funds is clearly set forth in the 
1990 Budget Act that notwithstanding any other provision of law, the 
receipts and disbursements of the Federal Old-Age and Survivors 
Insurance Trust Fund shall not be counted as new budget authority, 
outlays, receipts or deficit or surplus for purposes of anything we 
deal with regarding money, in effect. So it is difficult to examine 
this section plus the 98-to-2 vote and House Joint Resolution 1, the 
underlying legislation that is before this body, and not conclude that 
Social Security is being placed back on budget.
  Let me tell you why I say that. We are going to have a chart here, 
Madam President, that will show what House Joint Resolution 1 says. And 
if you look at that, it says in section 7 and section 8:

       Total outlays for any fiscal year shall not exceed total 
     receipts for that fiscal year.

  That is about as clear as it can be, that this should not be 
exceeded.
  Does this not necessarily include Social Security? If so, does this 
not run against Congress' historical treatment of Social Security off 
budget? Would it not overturn Congress' recent decision to confirm the 
off-budget status of Social Security? This overturns the vote we took 
by 98 to 2 to keep Social Security from any way of determining what the 
deficit is. I respectfully submit that the underlying legislation will 
force Congress and the President to include Social Security in 
balancing the budget. I believe that any court reading this all-
inclusive language would have to conclude that Social Security would be 
on budget and thus fair game for being used to balance the budget.
  The only way to guarantee the integrity of the Social Security trust 
fund is to exempt it from this balanced budget amendment. We would not 
have to worry about any of these questions if we passed the balanced 
budget amendment and excluded Social Security. That is the amendment 
now pending before this body.
  I believe this would be consistent with Congress' previous actions 
including the 98-to-2 vote in October 1990. It would be a reaffirmation 
of Congress' intent to guarantee the integrity of the trust funds.
  Conversely, the absence of an expressed exemption would result in 
inclusion of the trust funds in the calculation of the deficit. It 
would yield a radical departure from Congress' longstanding defense of 
the integrity of the trust funds. I do not want to be a part of that. 
We must exempt expressly Social Security to ensure that that fund is 
maintained in its entirety. So that there is no ambiguity, every Member 
of this body needs to support the specific exemption for Social 
Security. It is the only way we can ensure that there will not be an 
injustice perpetrated on the American people.
  I also want to preempt something that I know will come up because I 
have heard some comments on this floor about this, that my amendment 
will create a loophole in the Constitution.
  That is poppycock. That is diversionary. It will do no such thing. 
This amendment is narrowly drawn. It is an exemption that applies to a 
readily identifiable program. So do not be fooled by those who scream 
and shriek and yell and say you are placing the statute in the 
Constitution. Once it becomes part of the Constitution, it is no longer 
a statute.
  If we are all in agreement that Social Security should not be 
included for purposes of balancing the budget, then where better to 
enshrine the commitment than in the amendment itself. The fact is there 
is no other alternative. If we leave this out of the balanced budget 
amendment, it will go on budget. That is a fact. It will assuredly be 
looted, and that is a fact.
  Exemption in enabling legislation is insufficient protection. There 
are some opponents who have stated on this floor previously and who 
will argue that they, too, oppose balancing the budget by including 
Social Security trust funds. They believe and they will state that the 
proper place to address this issue is in implementing legislation. Let 
us think about that. We have a constitutional amendment that scholars 
like the senior Senator from Alabama and others say, if it passes as it 
is written, Social Security will have to be part of the balance. It 
will not be discretionary with the Congress. It will have to be used to 
balance the budget.
  But let us assume that we are not going to use that, we are not going 
to present that argument. What we are going to say is that we are going 
to have a statute that will say you are not going to touch Social 
Security.
  Well, you have two problems. One, it does not supersede what is in 
the Constitution that says you must include it. And secondly, that 
statute can be changed any time. We can pass a bill in this body today 
and we can repeal it tomorrow. We can pass a bill in this 
[[Page S2317]] body today and change it next year, the year after. So 
implementing legislation will not do it.
  I respectfully suggest that passing a balanced budget amendment to 
the Constitution is unprecedented. They are talking about offering my 
amendment as being unprecedented. All we are dealing with in this body 
until we dispose of this balanced budget amendment is unprecedented. 
This is the first time we have put fiscal policy in the Constitution. 
So we better get it right.
  It is unprecedented to place our Nation's fiscal policy in our 
Constitution. If we are going to do so, we must recognize that Social 
Security is also part of our Nation's fiscal policy. We are binding 
ourselves to a commitment that will require drastic changes in the 
immediate future. As a matter of equity, as a matter of fairness, we 
cannot bind ourselves to a commitment that puts at great risk a trust 
fund that millions of Americans have paid into all their working lives.
  Advocates of addressing this issue in enabling legislation contend 
that the trust funds will be adequately protected if we proceed 
statutorily. This, Madam President--I do not know how to say it any 
differently--is not true. What about future Congresses?
  If my friend who is managing the bill today at this time, the junior 
Senator from Utah, gave me his word he would not violate Social 
Security, I would take him at his word. He is a man of integrity. But 
what about his successors? They are not bound by any statement that he 
makes or any oath that he takes or any commitment he makes. The fact is 
this resolution as it is presented in this body presents no protection 
for Social Security. The only way to give it protection is to vote for 
this amendment that is presented by the Senator from Nevada and 14 
others. Assuming, though, that those who say they are going to protect 
it follow through on their words, there is nothing to prevent, as I 
have already indicated, another Congress from coming along and amending 
the statute that they have already passed to say you cannot use Social 
Security.
  I believe that there are some who are going to go after Social 
Security. I know it to be the case. I was on a national program 
yesterday with former Senator Tsongas, and he candidly stated Social 
Security moneys should be used to balance the budget.
  It is unfortunate but true, there are some who believe, to paraphrase 
our former colleague, Senator Goldwater, that extremism--this is a play 
on words on something that Senator Goldwater said on one occasion, 
that: Extremism in defense of balancing the budget is no vice.
  I do not believe that. Some do.
  As I mentioned, I am in favor of balancing the budget. However, a 
line in the sand must be drawn on the issue of Social Security. I am 
willing to go back to the people of the State of Nevada and say I voted 
against a balanced budget amendment because it did not exclude Social 
Security. I believe in the integrity of the Social Security System 
enough to take that chance. I believe if we do not do that, we are 
taking a chance on Social Security, and that is not a chance I want to 
take. I believe if we do not separate Social Security, it would put us 
on a road toward undermining one of the most fundamental agreements we 
have with the American people. Again, we can only avoid this by passing 
the amendment before this body.
  Advocates of a rigid balanced budget amendment say, ``Trust us. We 
will take care of Social Security in the implementing legislation.'' I 
have been through that. It will not happen. You cannot do that in the 
enabling legislation or in the implementing legislation. What if a 
challenge is made a few years down the road and the court looks into 
congressional intent? What will they see?
  If my amendment is defeated, a court will probably make the 
determination that Congress intended Social Security to be kept on 
budget. Why? Because specific proposals to exempt Social Security were 
voted down. They would not even have to look at the implementing 
legislation. Congressional intent would be evidenced by these votes. 
That is why it is even more important that this amendment pass. A vote 
against it sends the courts a message that congressional intent was to 
allow Social Security to be included in the budget.
  It would appear we all agree, I hope--I should say the vast majority 
agree. We know over 90 percent of the American public agree that Social 
Security should be exempt from the balanced budget amendment. There are 
a few, including Republican strategist William Kristol, who conceded 
the other day on Fox Morning News that there should be an inclusion of 
Social Security to balance the budget. But the record of support for 
protecting Social Security is overwhelmingly bipartisan in spite of Mr. 
Kristol and in spite of Mr. Tsongas.
  Again, I think this may well be due to the recognition that Social 
Security represents an unbreakable contract with the American people. 
This also explains why the issue is considered to be the third rail of 
politics.
  I do not wish to impugn the statements of those who publicly state 
they oppose touching Social Security but are unwilling to support an 
express exemption. They are Members of the freshman class in the other 
body, and I read the names of some of them, who are literally trampling 
over themselves to announce their opposition to including Social 
Security in the budget. The strong rhetoric emanating from the mouths 
of many should be matched, I believe, by unconditional support for 
legislation that expresses their concern.
  The only thing we have had that will exempt Social Security from this 
balanced budget amendment is the amendment that is being offered by the 
Senator from Nevada with 14 others.
  Those who are watching this debate should not be under any illusions. 
There is a significant difference between exempting Social Security in 
the balanced budget amendment and exempting it in the enabling 
legislation. The former means you get a new car, fully loaded with all 
the warranties. The latter is like buying a used car without even 
looking under the hood.
  My point, then, is that this is not some arcane legal distinction. 
Exempting Social Security in the enabling legislation is not without 
merits. What it offers is protection of a political kind, and I can 
understand that. It is a fig leaf for those who wish to publicly defend 
Social Security, and I understand that. They know as far as perceptions 
are concerned, supporting this fig leaf allows them, perhaps, to have 
their cake and eat it, too.
  My friend, the senior Senator from Utah, mentioned on this floor last 
week that he supported this because placing an exemption in the 
amendment itself would result in the creation of an enormous loophole. 
He suggested if my amendment were included, the balanced budget 
amendment would not be worth the paper it is printed on. Senator Hatch, 
the senior Senator from Utah, I know what a fine trial lawyer he was. I 
know, in trying cases, sometimes the best defense is a good offense. I 
recognize that is probably what my friend from Utah was doing.
  I disagree with his statement. I disagree with this, and respectfully 
suggest it is just the opposite. The real loophole would be created 
unless this issue is addressed in the amendment. It is a loophole that 
will allow future Congresses to loot the Social Security trust funds. 
The only thing that will not be worth the paper it is written on is the 
Social Security cards that American workers carry around with them. The 
real Contract With America, the Social Security agreement we all 
participate in throughout our working lifetimes, will be worth very 
little. If you really want to close the loopholes, if you really want 
to ensure the continued viability and value of the Social Security 
System, then you will support the amendment expressly exempting Social 
Security.
  To accept anything less is an attempt to pull the wool over the eyes 
of the American public.
  I do not think many people will be hoodwinked by these types of 
maneuvers. I am confident they will recognize this enabling legislation 
for what it really is, and that is something to cover, a fig leaf. The 
stakes are very high here for people who are involved in these 
programs. To understand the importance of this debate, we have to move 
forward beyond all our talk of the Constitution and all the legal 
arguments associated with this debate. I 
[[Page S2318]] am referring now to senior citizens and the groups that 
represent them.
  I have here a number of letters from various groups, advocating on 
behalf of senior citizens. I have here a letter from the National 
Alliance of Senior Citizens. This letter states, among other things: 
``On behalf of the National Alliance of Senior Citizens, this letter is 
to express our strong support for the Reid balanced budget amendment.''
  This was written last year. I have here a letter from the American 
Association of Retired Persons. They, too, Madam President, state their 
support. The American Association of Retired Persons believes the 
amendment I am offering is a step in the right direction. They are 
opposed to the balanced budget amendment. But they recognize that a 
step in the right direction is my amendment.
  We also have the Committee to Preserve Social Security, which 
strongly supports legislation that is now before this body.
  The American Association of Retired People states that, ``We applaud 
your commitment to protecting Social Security.'' This letter is 
addressed to me.
  We also have a statement from the National Committee to Preserve 
Social Security, and they state without reservation or hesitation that 
this amendment should be passed.
  These three letters that I have referred to from these interest 
groups represent millions of senior citizens. I respectfully suggest 
that we should listen to what they are saying in behalf of their 
constituents. These people who are receiving these benefits are playing 
by the rules. Their lifetime of labors went into making this Nation the 
envy of the world not only for today but for generations past. They 
have contributed to the Social Security System throughout their lives, 
and they do not deserve to have the rug, in effect, pulled out from 
under their feet.
  For many of our Nation's seniors, Social Security is the sole source 
of their income. For some it is supplemental, but for many it is all 
they have. We have all had instances where seniors are depending on 
Social Security, and literally every penny is of importance to them. We 
have been through the debates where we have had seniors who are 
depending on Social Security who are eating cat food, who are really 
desperate for money. We must protect this Social Security trust fund. 
The contribution made by employers and employees is something that we 
must protect.
  Madam President, I am not going to go into a lot of detail. I have 
already told my friend, the senior Senator from Utah, that I spread on 
the Record on a previous occasion my remarks about the seniors' 
coalition. If in fact the seniors' coalition gets involved in this 
debate, I will refer in more detail to the seniors' coalition, and I 
will reserve the right at some subsequent time to seek the floor to 
talk about them, if necessary, in some detail, a group that does not 
truly represent the seniors of this country.
  Madam President, I voted in favor of the amendment that was just 
defeated because I would like to have known where these cuts are going 
to come from. I, in fact, cosponsored the amendment that was put 
forward by the Democratic leader.
  I am concerned, however, for a balanced budget. As of today we have 
not seen the hard numbers of evidence of a working formula for getting 
us into balance. But I am willing to accept that. It was an up-or-down 
vote, and we lost. But I am not willing to accept a defeat of this 
amendment unless I can certainly spread on the Record of this body that 
I cannot, in good conscience, support a balanced budget amendment that 
includes Social Security moneys to balance the budget. Without a 
detailed formula, I have no idea what is going to happen to Social 
Security. So why not just exclude it?
  Without a detailed formula, there is no guarantee that a restricted 
enforcement of the balanced budget amendment will not result in the 
wholesale looting of the Social Security trust funds. I believe there 
will be no choice but to lose the trust funds. In the absence of the 
details, I suggest emphatically that it is even more imperative that we 
expressly exempt Social Security from the balanced budget amendment. 
Without truth in budgeting, we are placing at risk the entire Social 
Security program. Promises are not sufficient. We are talking about 
amending the U.S. Constitution. Promises will always be preempted by 
the Constitution, and that is why my amendment ought to be supported.
  I repeat that 1935 was the beginning of this Contract With America, 
the original contract with America. We have established in the Social 
Security legislation a trust fund that must be protected. We have a 
fiduciary relationship. We have an obligation of trust to make sure 
that those moneys are collected and that they are disbursed for the 
purposes for which they were collected. Social Security does not 
contribute one iota to the Federal deficit.
  Mr. President, I ask unanimous consent to include Senator Feingold as 
a sponsor of this amendment.
  The PRESIDING OFFICER (Mr. Craig). Without objection, it is so 
ordered.
  Mr. REID. Mr. President, there are these huge surpluses that are 
building up in the Social Security trust fund that I believe we must 
protect. Failure to save the surplus could undermine Social Security. 
We must be concerned how Social Security is treated in the budget. We 
know that just a few years ago we, by a vote of 98 to 2, said we are 
not going to put Social Security in any of the problems we have with 
deficit spending. We cannot reverse that now. That would be unfaithful 
on our behalf. We would be unfaithful. Social Security will be treated 
very stringently in this budget. That is why it is important that 
Social Security be excluded.
  I see in this Chamber the junior Senator from South Carolina, a man 
with a wide range of experience, who was Governor of a State. He 
understands budgeting. If our side had seniority, he could be chairman 
of the Budget Committee as we speak; a man who I remember when running 
for President talked about budget deficit problems, many years ago. He 
is someone who has a lot of wisdom about numbers. But I would bet, 
although I am not certain, the great southern State of South Carolina 
would have the ability when they balance their budgets to have some 
things off budget. They can have some capital expenditures that are 
done through bonding at the State level.
  Mr. President, this budget, if it passes, likely will not have a 
capital budget in it. It is, therefore, all the more important that we 
protect Social Security because this balanced budget amendment that is 
before this body is the strictest I have ever seen. It is a lot 
stricter than most everyone treats their own budget because in your own 
budget you have your house off budget. You make payments on that. You 
have your car off budget. You make payments on that, and the 
refrigerator and other large items. They now have programs where you 
can have your children's education off budget. You can make payments on 
that.
  So this balanced budget amendment that is now pending before this 
body--and I accept it--is going to be very stringent and tough. But let 
us exclude Social Security because putting Social Security on budget 
contradicts congressional intent. Expressed exemption is the only 
guarantee. Exemption in the enabling legislation simply is 
insufficient.
  We must do this to protect the integrity of the Social Security trust 
fund. We have heard a great deal about our responsibilities, Mr. 
President, to future generations. All of us are aware of our moral 
obligation to provide our children and our grandchildren with a healthy 
economy free of debts, especially which they did not incur.
  This, in part, is why I support the idea of amending the Constitution 
to balance the budget. Another obligation we all share, however, is to 
ensure that we provide for the younger generation of yesterday, or, 
more accurately, today's senior citizens. We must ensure that they too 
be treated in an equitable manner. We honor their lifelong sacrifices 
of honoring the Social Security agreement we made, the original 
contract with America. We honor their sacrifices by ensuring that the 
trust funds they paid into all their working lives are not used for 
other purposes. We must honor their sacrifices by exempting the Social 
Security trust fund from the balanced budget amendment.
  I plead with my colleagues to listen to the debate that will ensue in 
the 
[[Page S2319]] next couple of days, and to have this vote take place 
not only with your heart, but with your head. The Social Security trust 
fund should be exempted from the balanced budget amendment.
  Mr. BENNETT addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. BENNETT. Mr. President, I have listened to my colleague from 
Nevada give his statement, and tell us again and again and powerfully 
of his commitments to protect the Social Security trust fund.
  As I have listened to him, I have come to the conclusion that there 
could be nothing more devastating to the stability and the future of 
the Social Security trust fund than the amendment offered by the 
Senator from Nevada. I will share that reasoning with you.
  I know that is not his intent. I know he is acting out of the purest 
of motives. But I must say as strongly as I can in response to what he 
has said that the route he is suggesting that we go in an effort to 
support the Social Security trust fund is indeed the most dangerous way 
we could possibly go, if we in fact want to preserve that trust fund.
  Before I give that detail, let me make this comment about the overall 
debate. I remember last Congress the then-majority leader, the Senator 
from Maine, Mr. Mitchell, made one of his typically well-reasoned and 
eloquent statements in defense of the purity of the Constitution. He 
reminded us all that we were taking an oath to uphold and defend the 
Constitution when we entered this body, and he said in a pleading 
voice: Do not do anything that would jeopardize the Constitution. You 
are writing into the Constitu- tion--I am paraphrasing 
rather than a direct quote--you are writing into the Constitution 
matters that should be left to policy, that should be left to 
legislation, and you are changing the nature of the Constitution, which 
is our basic law, by proposing this amendment. He pled with us not to 
do that, on the basis of sound constitutional theory.
  Frankly, Mr. President, I was somewhat moved by the majority leader 
in that case, and I found myself questioning whether or not we really 
did need to amend the Constitution to get this taken care of. I have 
talked about how I resolved those differences at another time on the 
floor, so I will not repeat them here. But I find it very interesting 
that when we had, as the principal reason why we should defeat this 
amendment last year, the plea to keep policy matters out of the 
Constitution, we now have before us, as the principal thing that we 
must do in order to make this amendment viable, an amendment that 
writes policy matters into the Constitution, that flies right in the 
face of the advice of the former Senator from Maine, Mr. Mitchell, when 
he was opposing this 2 years ago.
  We are going to write statutory language into the Constitution if we 
adopt the Reid amendment and it gets ratified by the States. I think 
that is foolish. I think that changes the nature of the Constitution 
tremendously and, as I say, I think it is tremendously dangerous to 
Social Security. Why? Well, I have before me the language of the Reid 
amendment, and let us read it. It is very simple, very straightforward. 
It says:

       The receipts and outlays of the Federal old age and 
     survivors insurance trust fund and the Federal disabilities 
     insurance trust fund used to provide old age survivors and 
     disability benefits shall not be counted as receipts or 
     outlays for the purpose of this article.

  My colleague, the senior Senator from Utah, has already talked about 
the inappropriateness of writing into the Constitution titles of 
existing legislation. Let us assume for just a moment, however, that 
that is an appropriate thing to do. I do not believe for a moment that 
it is, but let us assume that it is. Then we say, all right, ``the 
funds used to provide old age survivors and disabilities benefits shall 
not be counted for the purposes of this article.''
  Mr. President, what is a survivor? The answer to that is very clear. 
A survivor is whatever Congress says it is. So if we want to, in the 
language of the senior Senator from Nevada, use the implementing 
language of statutes to change the system, Congress can change the 
definition of survivor and be within the Constitution and loot the 
trust funds. Suppose Congress says a survivor, for the purpose of this 
amendment, is anyone who is alive. You have survived and, by 
definition, therefore, we can give you any benefit we want out of this 
fund and we are not violating the Constitution, we are not violating 
the Reid amendment to the balanced budget amendment. Congress can 
define a survivor as anyone who is over 21. Congress can define as a 
survivor anyone who has a driver's license and who has lived for 6 
months after having driven. Having driven with some teenagers, I can 
accept that definition. Maybe you are a survivor if you stay alive for 
6 months after receiving your license.
  Disability benefits. Mr. President, what is a disability? The answer 
is very clear. A disability is whatever Congress decides a disability 
would be. So Congress could decide, as indeed some groups in our 
society already have, that to be a woman is a disability in our 
society. Therefore, the money that is in this fund which under the 
Constitution is to be used for disability benefits can be spent on 
behalf of women and not men. There are others who will then say, oh, 
no, it is not a disability to be a woman, it is a disability to be 
overweight. So we are going to use the money to take care of everybody 
who is fat. No, it is a disability if you are too short. It is a 
disability if you are too tall. We have the American With Disabilities 
Act that outlines a whole bunch of disabilities, none of which are 
currently covered under Social Security or the disability insurance 
trust fund. If you are in a wheelchair, we are going to use the funds 
out of this fund to take care of you. We are going to use these funds 
to buy you a wheelchair or build you a ramp in your house, or whatever 
it is Congress decides to do.
  Mr. President, obviously, the examples I am giving are outlandish; I 
realize that. I make the point to show that there is, in fact, no 
restriction whatsoever on future Congresses to make whatever outlandish 
definitions they may choose. The one we think we all know is old age. 
What is old age? Old age is whatever Congress says it is. Right now, 
Congress says old age is 65--unless you happen to be a Federal employee 
with a sufficient amount of service to your credit, and then you can 
retire at age 50. Suppose some future Congress says that old age, to 
keep it all straight, is 50. We can go into the Federal disability 
insurance trust fund and the old age and survivors insurance trust fund 
and we can take that money to do things for anybody who is 50.
  The Senator from Nevada has said implementing legislation will not do 
it, we can pass a bill to change it. Yes, we can pass a bill to change 
the definitions that are under this proposed amendment, and we can, if 
we want to, gut the Social Security trust fund any time we want to. To 
hold out to somebody the promise that passage of the Reid amendment 
will guarantee that Social Security will never change and will never be 
in jeopardy is to hold out a promise that is false. To hold out that 
idea, which is well-intentioned, Mr. President, frankly, is misleading.
  The Senator from Nevada tells us that this is narrowly drawn and says 
that it will preserve the Social Security trust fund because it is 
narrowly drawn. I have not gone to law school, so I suppose I cannot 
argue with him in legal terms. But I do understand the English 
language, and I do believe that which I have said demonstrates that it 
is not narrowly drawn; indeed to the contrary, it leaves the door wide 
open for future Congresses to do all of the things that the Senator 
from Nevada suggested that some future Congress might do. He said if we 
just leave it as it is, future Congresses could raid the fund. That is 
true. Future Congresses could also abolish it. That is true. Future 
Congresses could, under his amendment, say that there will be no taxes 
connected with and no outlays made from the Federal old age and 
survivors insurance trust fund and cut it off at that point and leave 
these lines a dead letter in the Constitution. Future Congresses could 
do all of these things. There is simply no assurance in the Reid 
amendment that future Congresses will behave as he believes they will.
  Now he has said to us--and I accept it in the spirit in which it is 
offered--that 
[[Page S2320]] those of us who say we do not want to attack Social 
Security in the present circumstance are acting in good faith and have 
good motives. And I am grateful to him for his willingness to accept 
our good faith. I accept his good faith.
  But he raises the specter of future Congresses acting irresponsibly. 
And I suggest to you, Mr. President--indeed, I am convinced, Mr. 
President--that if future Congresses do decide to act irresponsibly, 
they can do so just as easily under his amendment as they can now. And, 
indeed, in the matters I have pointed out, they have a greater 
temptation to do so if the Reid amendment is adopted, because all they 
need to do, as I have said, is change the definition of a disability, 
change the definition of a survivor, change the definition of old age, 
and they have those funds then available to them to do with whatever 
they see fit.
  Mr. President, I would like to return to the basic issue that I 
raised in the beginning before I got that specific about the Reid 
amendment. I wanted to be specific about the Reid amendment because of 
the time and care with which he took to address his argument and I 
wanted to respond as quickly as I could.
  Let us go back to the comments that I recall being made by the then 
majority leader, George Mitchell, when he pleaded with us not to fool 
around with the Constitution on this matter, when he told us, in 
effect: We can do this by statute. If we had the political will, we 
could balance the budget without changing the Constitution. Why do we 
want to put a policy matter, a normal legislative issue, into 
constitutional language?
  Well, Mr. President, I have been troubled by that argument, as I have 
said. I was moved by Senator Mitchell and his comments in that regard. 
I have such tremendous regard and respect for the Constitution that I 
think it should be amended only rarely and only in extremis.
  I agree with the argument that we could do this without a 
constitutional amendment requiring it. Why am I, therefore, standing 
here as a convert to the balanced budget amendment and defending it?
  I have resolved this issue in my mind from this analogy.
  As you know, Mr. President, and as Members of this body probably get 
tired of hearing me say, I am a businessman and I come out of the 
business environment. That is where I get most of my analogies.
  When a business is established, the first thing that is required, at 
least under the laws of the States where I have established businesses, 
is the filing with the State authorities of the bylaws. The bylaws lay 
out in clear pattern the constitutional authority, if you will, of the 
business. It says what management can do and cannot do. It lays out the 
structure. Just as the Constitution of the United States says there 
will be two Houses of Congress and how many Members there will be in 
each House, two from each State for the Senate, by population for the 
House, and so on, the bylaws of the business say how many members there 
will be on the board of directors, what the power of the board of 
directors shall be, and so on and so forth.
  It is never contemplated in the bylaws that the organizers of the 
business will lay out a specific business plan. That is left up to 
management. The idea is always that annual projections will be made by 
management. Management will be held accountable. Management will have 
to file appropriate accounting reports. Management will have to file 
tax returns and do all of the other things. The bylaws of the business 
say how management is to operate, but never get into the specifics of 
the business plan.
  What we are talking about here is an amendment to the bylaws. And, 
once again, we find a disconnect, we find an interesting paradox. We 
are being told, on the one hand, we cannot adopt this particular 
bylaw--this particular amendment to the Constitution--unless it is 
accompanied by a detailed business plan, stretching out for 7 years, 
giving to the last dollar everything that will be done.
  If you were to say that to an organizer of business, ``We are going 
to require you, before you amend the bylaws of the corporation, to give 
us a 7-year business plan showing how you will operate under this new 
amendment,'' management would resign. It would say, ``Under no 
circumstances can we live with that kind of a requirement.''
  Now, what is this bylaw saying? Is it indeed a policy statement that 
belongs in the area of management that should be kept out of the 
Constitution?
  We are hearing a lot of concern over the three-fifths requirement; 
over the requirement that Congress has to vote three-fifths if it is 
going to have a budget that is not in balance. And we are being told, 
indeed, I have been told in hearings before the Joint Economic 
Committee by Members who are opposed to this amendment, ``No business 
in the world would ever adopt anything like the balanced budget 
amendment. No business would ever put its management in that kind of a 
straitjacket where a minority could block the business plan.''
  Well, I said in the Joint Economic Committee, and I repeat here, I 
think I know something about business, and I can identify plenty of 
businesses who do indeed put themselves into this kind of circumstance.
  Again, the analogy, Mr. President: Suppose you had a business and it 
adopted as one of its bylaws that the business could not go into long-
term debt without the approval of 60 percent of the members of the 
board of directors. That would not be an unusual kind of circumstance. 
The shareholders would feel they would be more protected if the members 
of the board had to come up with not just a majority to put the 
corporation into debt but a supermajority to put the corporation into 
debt. That would be an appropriate bylaw. If it were adopted, eyebrows 
would not go up.
  Indeed, I have served in circumstances where the board of directors 
did not require a supermajority before going into an area of long-term 
debt, they required unanimity. That is unusual, but it exists. We are 
not asking for that here.
  We are simply saying the board of directors--in this case, the two 
Houses of Congress--must have a sufficient level of support to gain 60 
percent of both Houses before that board of directors will allow the 
corporation to increase its long-term debt, a very reasonable 
requirement in a set of corporate bylaws.
  So, once again, the arguments come in and they do not connect with 
each other, the first one saying, ``You shouldn't be putting anything 
like this in the Constitution at all.''
  ``Why?''
  ``Because this is something that is taken care of through 
legislation.''
  And then there is the other argument, saying, ``Oh, no; you should 
not adopt this amendment unless it has legislation in it.'' The two 
simply do not match.
  Then the statement, ``Oh, you cannot adopt this balanced budget 
amendment until you give us all of the details.'' And then, back on the 
first amendment, ``But the Constitution is not the place where you talk 
about details.''
  What comes through to me, Mr. President, is that these arguments that 
are being raised against it have the flavor of an old story that I 
remember where two neighbors in a frontier circumstance were meeting. 
The first neighbor said to the second: ``I have some work to do around 
my place. I have dropped my ax on a rock and it cut a chip out of the 
blade of the ax and it is worthless to me. I would like to borrow your 
ax to help me break up some wood.''
  The second neighbor thought for a minute and said, ``I am sorry, I 
can't loan you my ax. I need it to shave with.'' The first fellow went 
away. After he was gone, the wife of the second fellow said, ``What did 
you tell him that for? That is a silly excuse. You do not shave with 
your ax.'' And he said ``Well, I didn't want to loan it to him because 
I was afraid I wouldn't get it back. But I didn't want to offend him so 
I did the next best thing.''
  I think many of the arguments that are being raised are, in fact, 
being raised because some of the people raising them really do not want 
to put the Government in a circumstance where it is forced to confront 
the reality of a balanced budget discipline. But rather than offend 
their voters by being upfront about it, they are looking around for 
excuses like, ``I'm going to use the ax to shave with.''
   [[Page S2321]] Now, I do not suggest that that is the case with my 
friend from Nevada. I think he genuinely and with good intentions 
supports this amendment and believes that it would, indeed, help save 
the Social Security system. I hope I have made it clear that it would 
not save the Social Security system from the things that he has 
suggested.
  Now, Mr. President, we will address the basic question of whether or 
not balancing the budget makes sense. There are those who say this is 
one of those mirages that is always in the future and no matter how far 
you move toward it, you never get to it. The balanced budget will 
always be in the future; we will never, ever, want to do it.
  I have spoken about this before, but I return to it because it is the 
fundamental question underlying this whole debate. As I have said, I am 
a reluctant convert to this debate. I am very reluctant to make changes 
in the Constitution. I look back on our history and say we have gone 
for over 200 years without a balanced budget amendment. We have done 
just fine. Why do we need it now?
  Further, I accept the idea that it does come close to introducing 
legislative and policy issues into the Constitution rather than dealing 
strictly with fundamental law. I hear all those arguments. I am 
sympathetic to many of them. I come to the conclusion that we must have 
a statement in our basic bylaws--in our case, in our Constitution--that 
says we will resist the historic destabilizing influence in all 
democracies. The Senator from Arizona [Mr. Kyl] quoted the historian 
who said that democracies ultimately disintegrate when the people 
discover that they can vote themselves largess. That is, when people 
discover that they can use their power in a democracy to use Government 
power to pay themselves more than is really there, they ultimately 
destroy their country.
  We are not at that point yet. But we are beginning to get so far down 
that road that I am getting nervous. We need a statement in the 
Constitution that says we will not do that. Thomas Jefferson was afraid 
of that. That is why he raised the balanced budget amendment as an idea 
back in the beginning. They shied away from it. As I say, we have gone 
for 200 years without needing it. But we are getting there and we are 
getting there more and more as we go down this slippery slope to 
entitlements.
  Mr. President, I suggest that we can have entitlements and we can 
have a balanced budget. The two can coexist. But it will take a 
redefinition of the word ``entitlement'' in order to get America there.
  Let me share this observation that comes out of my personal 
experience. I hesitate to raise it, lest some misunderstand its source, 
but I raise it nonetheless because commentators outside of Utah who 
have had no religious backing to their point of view have raised it. I 
think, therefore, it is appropriate.
  I want to talk briefly about the welfare program of the Church of 
Jesus Christ of Latter-day Saints, of which I am a member. We have an 
entitlement as members of the church under the welfare program. Any 
member of the church who falls in need is entitled to receive help from 
the church. As an official of the church, I have been involved in 
dispensing that help. I have seen how it works. I have given vouchers 
to members of my congregation who turned those vouchers into food and 
clothing. I have signed checks to members of my congregation who have 
turned those checks into rent payments or money for their children or 
other vital necessities in their lives.
  If anything should ever happen to me, I am entitled to go before my 
church leaders and say, ``I want some food. I want some clothing. I 
want some cash to take care of my shelter.'' I am entitled to that as a 
member of the church if I need it. That is the qualifying phrase to 
that--entitled. I am entitled to it if I need it.
  Where does the entitlement come from? The same place that the Senator 
from Nevada spoke of--the people who pay into Social Security. I am 
entitled to that from my church because I have gone down to the cannery 
on my own, without being paid for it. I have canned peaches. I have cut 
up pears. I have peeled tomatoes. Frankly, I did not do it very 
expertly, to be sure, but I have done it, and my family has done it. I 
have gone to the farm out here in Maryland and I have worked on the 
farm and I have shoveled hay and I have shoveled what was politely 
called ``used hay.''
  I have participated in the programs, and that has created for me a 
sense that I am entitled. I would walk in and face my Mormon bishop 
without a moment's hesitation and say to him, this is what has happened 
to me. I am in need. I am entitled to help. And I would walk out with 
my head held high. If I received that help I would not consider it 
charity. I have paid into that. I have contributed to it. I am entitled 
to receive it.
  The difference between that attitude and what we have going on in the 
Government is this. What is happening to the entitlement programs in 
the Government is we are saying, ``You are entitled to it whether you 
need it or not.''
  We are in the midst of a baseball strike. We see baseball players 
whose average salary is $1 million a year. One of those baseball 
players could receive disability insurance even if his contract 
continued to pay him $1 million a year, because under our program he is 
entitled to it. And because we provide it for him, we cannot provide it 
in the degree, perhaps, that we should to other people who need it far 
more.
  We have reached the point where we have said, ``You are going to be 
paid back out of your own funds in the name of entitlement programs, 
Government largess, if you just vote for us.'' This is the pattern that 
has been established years ago. No one Congress is solely responsible. 
No one Member of Congress is solely responsible. It has built up over 
the years. It has gone forward over the years.
  Eventually we get into a circumstance where people are saying, ``I 
want mine. I want it now.'' You look at them and say, ``Wait a minute, 
you do not need it. Why do we not save that for someone who does?'' And 
they say, ``I want it because I am entitled to it whether I need it or 
not.''
  That, Mr. President, I think, is the key to getting the budget under 
control. Yes, we have to cut defense. Yes, we have to get rid of the 
waste, fraud, and abuse in the Government. Yes, we have to have leaner 
and tighter departments. Yes, we have to do a whole number of things to 
get the Government smaller.
  But if we learned nothing from the entitlement commission--and 
Senator Kerrey of Nebraska has courageously and honestly and 
forthrightly portrayed this in his statements that have been reported 
clearly in the press--we have learned that if we do not get the overall 
entitlement monster under control, we will succumb to the fate that was 
outlined for us by that historian. Democracy fails when people discover 
they can vote themselves largess, and when we get in that context and 
in that circumstance, we are going to be in trouble.
  How do we deal with it? As I say, I have come to the conclusion, 
after thinking it through, that the way we deal with it is to put into 
our basic bylaws--in our case, our Constitution--a statement that says 
we will not go down that road. I am not sure that if I were acting 
alone I would have drafted the balanced budget amendment as it is 
currently worded. The democratic process requires that we all get 
together and we get a consensus or we at least get a majority as to how 
it is done.
  I might argue with this phrase or that phrase, but I cannot, finally, 
argue with the notion that it does, indeed, belong in the Constitution.
  Indeed, I have come to the conviction that it belongs nowhere else, 
because if the Constitution is going to lay down the fundamental 
concepts of our country and what we believe, it is going to lay down 
our fundamental rights as individuals in this country and the 
fundamental structure of our Government in this context; it is flawed 
and diminished if it does not have in that list of fundamental 
structural patterns and fundamental rights a statement that says we 
will not allow the Government to spend ourselves into bankruptcy.
  I can think of nothing more fundamental. I can think, as I say, of no 
place more logical for that statement to be than in the Constitution.
  So, Mr. President, I have wandered from responding to the senior 
Senator 
[[Page S2322]] from Nevada and his amendment, which is before us, to an 
overall statement of the underlying resolution that is before us and 
given you my reasons as to why I am in support of that.
  I conclude by returning to the issue that is directly before us and 
summarizing, once again, my conviction that adoption of the Reid 
amendment would create the temptation on the part of future Congresses 
to do the very thing that the senior Senator from Nevada is concerned 
about: That it would create the temptation for future Congresses to 
give us legislation that would raid the Social Security trust funds.
  He said our successors are not bound. Absolutely our successors are 
not bound. Our successors might easily decide to redefine what is a 
survivor, redefine what is a disability benefit, redefine what is old 
age in such ways as to use those trust funds for virtually any 
purposes.
  My colleague, the senior Senator from Utah, Senator Hatch, calls this 
a giant loophole. The senior Senator from Nevada refers to that as 
poppycock. I will let the two senior Senators argue that one back and 
forth on a semantic level, but I find myself persuaded that the 
language in the Reid amendment does, indeed, provide such wide latitude 
for future Congresses that I would come down in agreement with my 
senior colleague from Utah that it would, indeed, be a huge loophole 
through which future Congresses could drive gigantic appropriations if 
they were so inclined.
  So, Mr. President, I leave the issue with these observations and 
trust that they will have contributed something to this particular 
debate. I yield the floor.
  Mr. MOYNIHAN addressed the Chair.
  The PRESIDING OFFICER. The Senator from New York [Mr. Moynihan] is 
recognized.
  Mr. MOYNIHAN. Mr. President, I would like to speak briefly to the 
amendment that has been offered by my good friend and colleague, the 
Senator from Nevada, Senator Reid, which states that receipts, 
including attributable interest and outlays of the Federal old age and 
survivors insurance trust fund and the Federal disability insurance 
fund, shall not be counted as receipts or outlays for the purposes of 
this article--that being the proposed amendment to the Constitution.
  In what I hope will not be the outcome of this debate, which is to 
say the Senate approving such an amendment to the Constitution, at the 
very least, the Reid provision provides hope for the Social Security 
system. It is a slim prospect, given the extraordinary fiscal turmoil 
and tumult, that will follow the adoption of this proposed amendment to 
the Constitution. But it does declare the interest of the Congress and 
then of the States in the preservation of Social Security, an issue 
which becomes--in my time in the Senate, I have seen one fully-agreed-
upon, solidly financed, well-administered program, the most successful 
social program in the 20th century go from being a given to being a 
problem and to being problematic. We refer to it as an entitlement.
  I make the point that the very able majority leader of the House, Mr. 
Armey, corrects us all when he says it is a ``fiduciary 
responsibility'' of the Federal Government, which is to say these funds 
are not ours to dispose of as we will. We hold them in trust. They are 
called trust funds.
  The revenue stream will continue in surplus--cash surplus--until the 
year 2012, as we now expect. We can add a year, plus or minus; there is 
that possibility. Social Security began as a pay-as-you-go system in 
the depth of the 1930 depression. That you take more out of the economy 
than you put in seemed to be unwise and it would have been, and we had 
difficult consequences even so.
  The 1937 recession was probably, in part, triggered by the 1935 
payroll tax. But in any event, near a half-century goes by and the 
Social Security amendments of 1937. Seeing the peculiar demography of 
the baby boomers and their eventual retirement, that great increase in 
births that followed the long, slow level of the 1930's and the Second 
World War, we put in place a partially funded system. I was a member of 
the Finance Committee. I was a member of the committee on conference.
  We put in place, Mr. President, a cash surplus which, over the 
period, would extend--to give you a sense of the proportion, it would 
buy the New York Stock Exchange. It still flows in cash surplus and 
will for the better part of 15 to 20 years, in prospect. So great 
praise and thanks to the Senator from Nevada for his effort in this 
regard--reserving always the point that I would like to make at some 
time that the amendment itself is a huge mistake that I hope we will 
not make.
  Mr. HOLLINGS addressed the Chair.
  The PRESIDING OFFICER. The Senator from South Carolina.
  Mr. HOLLINGS. Mr. President, let me compliment our distinguished 
colleague from Utah. He certainly attracted my attention when he spoke 
of the Mormon Church. I had the distinct pleasure, with a group of 
Senators, of visiting with his revered father, former Senator Wallace 
Bennett, to the Mormon Temple here in Washington, DC.
  Various members of my staff have been members of the Mormon Church. 
Their dedication and hard work have been a tremendous inspiration to 
me. A female staffer of mine was making good money, but left to fulfill 
her 2-year commitment to the church by going overseas. She paid for her 
own transportation and, at a very young age, solicited membership for 
the church for 2 years. I would have hesitated allowing my daughter to 
do that, but she did and did it with courage and commitment.
  So I have the greatest respect for the comments of the Senator from 
Utah, but I do find them in some measure strange.
  For example, when he claims that the Reid amendment creates a 
loophole by allowing Congress to redefine the word ``survivor.'' If 
that is true, can't we change what is an ``outlay,'' what is a 
``receipt,'' what is an ``estimate,'' what is ``appropriate 
legislation''? These phrases are already in House Joint Resolution 1, 
the joint resolution proposing a balanced budget amendment to the 
Constitution of the United States. All of the terms in the underlying 
joint resolution can be changed. There is no question about that.
  The balanced budget amendment to the Constitution is really proposed 
as a sort of gun to the head of the Congress to bring about discipline. 
As experience has told me and much to my dismay, Mr. President, it 
brings about creativity.
  This morning at the Budget Committee I had the pleasure of 
questioning the distinguished Director of the Office of Management and 
Budget, Dr. Alice Rivlin. I noted that Dr. Rivlin, as the Director of 
our Congressional Budget Office, had been the one individual who more 
than any other gave integrity and credibility to the budget process. 
She did an outstanding job then, and I think she is doing an 
outstanding job in the Clinton administration. But I noted that even 
with her watchful eye, there is a penchant in budget process for 
creativity.
  For example, in the President's budget, the majority of proposed tax 
cuts are paid for by cuts in discretionary spending. Under existing 
budget law, tax cuts can only be offset either by tax increases or by 
entitlement cuts. Thus, the President's budget would cause OMB to 
initiate a sequester.
  Additionally, the President's budget counts the sale of assets as 
receipts. Under procedures that the Congress uses in scoring, using 
assets sales to comply with pay-as-you-go laws subjects a budget 
resolution to another point of order.
  Third, the President's budget artificially adjusts the discretionary 
caps upward for inflation and then claims savings by lowering the caps 
to their existing levels. In contrast, the Congressional Budget Office 
in the past has not interpreted the law in this way and may not 
recognize these savings.
  Lastly, the reestimation of Medicare and Medicaid outlays in the 
President's budget seems overly optimistic. In fact, their estimate by 
2000 is $54 billion less than the level projected by CBO. In raising 
these issues, I am not trying to criticize the President's budget, I am 
merely trying to talk about the slippery game of budget estimates from 
a standpoint of experience.
  When the distinguished Senator from Utah cites Jefferson, it brings 
to mind another quote by James Madison in The Federalist Papers. He 
said:

       [[Page S2323]] But what is government itself but the 
     greatest of all reflections on human nature? If men were 
     angels, no government would be necessary. If angels were to 
     govern men, neither external nor internal controls on 
     government would be necessary. In framing a government which 
     is to be administered by men over men, the great difficulty 
     lies in this: You must first enable the government to control 
     the governed; and in the next place oblige it to control 
     itself.

  Thus, 207 years ago, Madison saw the very evil that brings us to the 
floor of the Senate today. We are out of control. I congratulate my 
distinguished colleague, the Senator from Nevada, Senator Harry Reid. 
He brings up an important and absolutely necessary amendment to this 
joint resolution.
  As Governor of South Carolina, I had to struggle to balance the 
budget. I knew in the early days that industry was not going to come 
from New York and invest in Podunk unless our fiscal house was in 
order. We had to pay the bills. I put in a device which was the 
forerunner of Gramm-Rudman-Hollings whereby expenditures had to be 
within receipts with quarterly reports to the Governor. If we failed to 
meet these targets, we would cut straight across the board. With this 
discipline, I got the first AAA credit rating of any State, from Texas 
right on up to Maryland.
  Since then I have continued to work in the vineyards. In 1984, I ran 
for President on the ``Fritz freeze,'' as many called it. My colleague, 
Senator Alan Cranston, ran on the nuclear freeze. We had to tell him 
that down home in South Carolina, they thought that the nuclear freeze 
was a dessert.
  The people of America know what is needed in our land. If you talk to 
your pollster, they scream:
  ``Oh, don't bring up deficits. The people don't want to hear about 
it. It is confusing. There's no story. They're not interested.''
  Thus, we have tax increases that no one wants to speak about--a tax 
increase of $1 billion a day on automatic pilot. The debt has gone up 
to $4.804 trillion. Before long, it will be $5 trillion. The gross 
interest cost for 1995 will be $339 billion and by next year will 
surpass $1 billion for every day.
  There are two things you cannot avoid. One is death and the other is 
taxes. As far as this Congress and this Senate and this Government 
goes, you cannot avoid those interest costs. They are the first thing 
off the table that we spend.
  Incidentally, I might well mention that the gross interest cost in 
1981, when President Ronald Reagan was elected, pledging to balance the 
budget and put us in the black in 1 year, was $95 billion. As I said 
earlier, it is now in excess of $339 billion. If you subtract it, you 
have $244 billion added to the interest costs. The deficit this year 
has been scheduled for $244 billion. Thus, without this tremendous 
overhang of debt, the Federal budget would be in balance.
  The Republicans talk about promises. If the distinguished former 
President had carried through on his promise, we would not be in this 
pickle. He came to town and said: ``Whoops, I never realized it was as 
bad as this. I cannot do it in a year. It is going to take 2 or 3 
years.'' that is how we moved from 1-year to 3-year budgeting. Gramm-
Rudman-Hollings pushed us out to 5-year budgets. And now, you ought to 
talk about creativity. Now, in the balanced budget amendment we are 
talking about 7 years. The next Congress will talk about 10 years.
  Mister President, Harry Reid, the Senator from Nevada, has a very, 
very important provision here--one that sheds some light on the 
enormous challenges we face in balancing the budget. I started down 
this road of a balanced budget amendment with the distinguished 
Senators from Texas and New Hampshire in Gramm-Rudman-Hollings. That 
was a balanced budget amendment. We got a majority of the Democrats on 
14 up-and-down votes to go along with the Republican leadership at that 
time in 1985. We reduced the deficit in the first full year of Gramm-
Rudman-Hollings from $221 billion down to $150 billion. We were 
supposed to reduce the deficit further by increments of $36 billion. 
But then, we began to stray from the targets until in 1990 we did away 
with fixed targets.
  Likewise, a balanced budget amendment to the Constitution does not 
give discipline; it gives creativity. That is the hard experience of 
this gentleman.
  Now, I wish to yield. I wish to hasten along because really the 
authority on the subject of Social Security, none other than our senior 
Senator for New York, Senator Moynihan knows the subject intimately. He 
has a tremendous sense of history, which I admire.
  He and I realized that many were tempted by the tremendous surpluses 
in the Social Security trust fund. So the distinguished Senator from 
New York authored, even though I offered it as an amendment, in the 
Budget Committee and in later in the Chamber, what we called a Social 
Security Preservation Act--take it off budget. In 1990, we had a vote 
in the Budget Committee, and the vote was 20 to 1, the 1 being my 
leader under Gramm-Rudman-Hollings, Senator Gramm from Texas.
  I can say advisedly I was not surprised, because I went to Senator 
Gramm in the initial stages of Gramm-Rudman-Hollings when his initial 
proposal was to cut all entitlements including Social Security.
  I said, wait a minute. No. 1, you are cutting the program that we 
just voted the taxes to pay for. It is paid for and is in the black. 
No. 2, it breaches the trust that we created in 1935 and that we have 
represented to the senior citizens of America. I am not going to breach 
that trust, and furthermore, you will not get a single Democratic vote 
to sequester Social Security.
  We got him to change his tune on that point. But when he voted 
against my amendment in the Budget Committee, and when he introduced 
his own legislation to balance the budget, he went back to his former 
position. On February 16, 1993, he introduced legislation which, in one 
pertinent section, read:

       Exclusion From Budget, Section 13301 of the Budget 
     Enforcement Act of 1990, as amended, by adding at the end 
     thereof the following: ``This subsection shall not apply to 
     fiscal years beginning with fiscal year 2001.''

  He had taken the section that I enacted into statutory law by a vote 
of 98 to 2 and attempted to change it in order to use the trust funds 
to lessen the chore of balancing the budget.
  We act like we are not the Government. It is like the San Francisco 
49ers coming into Miami, running up into the grandstand, and hollering, 
``We want a touchdown, we want a touchdown.''
  It is incumbent upon them to get down on the field and score the 
touchdown. It is incumbent on Members of Congress to stop the charades.
  So, when the distinguished majority whip, the distinguished Senator 
from Mississippi, just 2 days ago says, and I quote, ``Nobody--
Republican, Democrat, conservative, liberal, moderate--is even thinking 
about using Social Security to balance the budget.''--I say, 
respectfully: False.
  The experience of this Senator is Members of Congress will try to 
find a way to use these funds. If you do not include this amendment in 
the balanced budget amendment, you have effectively voided the Hollings 
statute. That is the statute on books this minute. But I have found out 
the hard way now, after 5 years, that it is sometimes easier to get a 
statute on the books than to get people to follow it. It is like old 
John Mitchell, the Attorney General, used to say, ``Watch what we do, 
not what we say.'' That is the situation we are in.
  So I would say to my colleagues that I strongly support the Reid 
amendment. It is very simple. It is very clear. We have a contract, as 
of 1935. It is an original contract predating Speaker Gingrich's 
Contract With America. We have one of Roosevelt's contracts for 
America, back since 1935, that we must honor.
  Before I close, Mr. President, I ask unanimous consent to have 
printed in the Record this document, including the different cuts, 
spending cuts and receipts and all for the 7-year budget.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                 Senator Hollings on Truth in Budgeting

       Reality No. 1: $1.2 trillion in spending cuts necessary.
       Reality No. 2: Not enough savings in entitlements. Yes, 
     welfare reform but job program will cost; savings 
     questionable. Yes, health reform can and should save some, 
     but slowing 10 percent growth to 5 percent--not 
     [[Page S2324]] enough savings. No, none on social security; 
     off-budget again.
       Reality No. 3: Hold the line budget on Defense--no savings.
       Reality No. 4: Savings must come from freezes, cuts in 
     domestic discretionary--not enough to stop hemorrhaging 
     interest costs.
       Reality No. 5: Taxes necessary to stop hemorrhage in 
     interest costs.

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                   1996       1997       1998        1999        2000        2001        2002   
----------------------------------------------------------------------------------------------------------------
Deficit CBO Jan. 1995 (using                                                                                    
 trust funds).................        207        224        225         253         284         297         322 
Freeze discretionary outlays                                                                                    
 after 1998...................          0          0          0         -19         -38         -58         -78 
Spending cuts.................        -37        -74       -111        -128        -146        -163        -180 
Interest savings..............         -1         -5        -11         -20         -32         -46         -64 
Total savings ($1.2 trillion).        -38        -79       -122        -167        -216        -267        -322 
Remaining deficit using trust                                                                                   
 funds........................        169        145        103          86          68          30           0 
Remaining deficit excluding                                                                                     
 trust funds..................        287        264        222         202         185         149         121 
5 percent VAT.................         96        155        172         184         190         196         200 
Net deficit excluding trust                                                                                     
 funds........................        187         97         27         (17)        (54)       (111)       (159)
Gross debt....................      5,142      5,257      5,300       5,305       5,272       5,200       5,091 
Average interest rate on the                                                                                    
 debt (percent)...............        7.0        7.1        6.9         6.8         6.7         6.7         6.7 
Interest cost on the debt.....        367        370        368         368         366         360         354 
----------------------------------------------------------------------------------------------------------------
Note.--Does not include billions necessary for middle class tax cut.                                            

       Here is a list of the kinds of nondefense discretionary 
     spending cuts that would be necessary now as a first step to 
     get $37 billion of savings and put the country on the road to 
     a balanced budget:

                                                                        
------------------------------------------------------------------------
      Nondefense discretionary spending cuts           1996       1997  
------------------------------------------------------------------------
Cut space station.................................     2.1        2.1   
Eliminate CDBG....................................     2.0        2.0   
Eliminate low-income home energy assistance.......     1.4        1.5   
Eliminate arts funding............................     1.0        1.0   
Eliminate funding for campus based aid............     1.4        1.4   
Eliminate funding for impact aid..................     1.0        1.0   
Reduce law enforcement funding to control drugs...     1.5        1.8   
Eliminate Federal wastewater grants...............     0.8        1.6   
Eliminate SBA loans...............................     0.21       0.282 
Reduce Federal aid for mass transit...............     0.5        1.0   
Eliminate EDA.....................................     0.02       0.1   
Reduce Federal rent subsidies.....................     0.1        0.2   
Reduce overhead for university research...........     0.2        0.3   
Repeal Davis-Bacon................................     0.2        0.5   
Reduce State Dept. funding and end misc.                                
 activities.......................................     0.1        0.2   
End P.L. 480 title I and III sales................     0.4        0.6   
Eliminate overseas broadcasting...................     0.458      0.570 
Eliminate the Bureau of Mines.....................     0.1        0.2   
Eliminate expansion of rural housing assistance...     0.1        0.2   
Eliminate USTTA...................................     0.012      0.16  
Eliminate ATP.....................................     0.1        0.2   
Eliminate airport grant in aids...................     0.3        1.0   
Eliminate Federal highway demonstration projects..     0.1        0.3   
Eliminate Amtrak subsidies........................     0.4        0.4   
Eliminate RDA loan guarantees.....................     0.0        0.1   
Eliminate Appalachian Regional Commission.........     0.0        0.1   
Eliminate untargeted funds for math and science...     0.1        0.2   
Cut Federal salaries by 4 percent.................     4.0        4.0   
Charge Federal employees commercial rates for                           
 parking..........................................     0.1        0.1   
Reduce agricultural research extension activities.     0.2        0.2   
Cancel advanced solid rocket motor................     0.3        0.4   
Eliminate legal services..........................     0.4        0.4   
Reduce Federal travel by 30 percent...............     0.4        0.4   
Reduce energy funding for Energy Technology                             
 Develop..........................................     0.2        0.5   
Reduce Superfund cleanup costs....................     0.2        0.4   
Reduce REA subsidies..............................     0.1        0.1   
Eliminate postal subsidies for nonprofits.........     0.1        0.1   
Reduce NIH funding................................     0.5        1.1   
Eliminate Federal Crop Insurance Program..........     0.3        0.3   
Reduce Justice State-local assistance grants......     0.1        0.2   
Reduce Export-Import direct loans.................     0.1        0.2   
Eliminate library programs........................     0.1        0.1   
Modify Service Contract Act.......................     0.2        0.2   
Eliminate HUD special purpose grants..............     0.2        0.3   
Reduce housing programs...........................     0.4        1.0   
Eliminate Community Investment Program............     0.1        0.4   
Reduce Strategic Petroleum Program................     0.1        0.1   
Eliminate Senior Community Service Program........     0.1        0.4   
Reduce USDA spending for export marketing.........     0.02       0.02  
Reduce maternal and child health grants...........     0.2        0.4   
Close veterans hospitals..........................     0.1        0.2   
Reduce number of political employees..............     0.1        0.1   
Reduce management costs for VA health care........     0.2        0.4   
Reduce PMA subsidy................................     0.0        1.2   
Reduce below cost timber sales....................     0.0        0.1   
Reduce the legislative branch 15 percent..........     0.3        0.3   
Eliminate Small Business Development Centers......     0.056      0.074 
Eliminate minority assistance, score, Small                             
 Business Institute and other technical assistance                      
 programs, women's business assistance,                                 
 international trade assistance, empowerment zones     0.033      0.046 
Eliminate new State Department construction                             
 projects.........................................     0.010      0.023 
Eliminate Int'l Boundaries and Water Commission...     0.013      0.02  
Eliminate Asia Foundation.........................     0.013      0.015 
Eliminate International Fisheries Commission......     0.015      0.015 
Eliminate Arms Control Disarmament Agency.........     0.041      0.054 
Eliminate NED.....................................     0.014      0.034 
Eliminate Fulbright and other international                             
 exchanges........................................     0.119      0.207 
Eliminate North-South Center......................     0.002      0.004 
Eliminate U.S. contribution to WHO, OAS, and other                      
 international organizations including the U.N....     0.873      0.873 
Eliminate participation in U.N. peacekeeping......     0.533      0.533 
Eliminate Byrne grant.............................     0.112      0.306 
Eliminate Community Policing Program..............     0.286      0.780 
Moratorium on new Federal prison construction.....     0.028      0.140 
Reduce Coast Guard 10 percent.....................     0.208      0.260 
Eliminate Manufacturing Extension Program.........     0.03       0.06  
Eliminate Coastal Zone Management.................     0.03       0.06  
Eliminate National Marine Sanctuaries.............     0.007      0.012 
Eliminate climate and global change research......     0.047      0.078 
Eliminate national sea grant......................     0.032      0.054 
Eliminate state weather modification grant........     0.002      0.003 
Cut Weather Service operations 10 percent.........     0.031      0.051 
Eliminate regional climate centers................     0.002      0.003 
Eliminate Minority Business Development Agency....     0.022      0.044 
Eliminate public telecommunications facilities,                         
 program grant....................................     0.003      0.016 
Eliminate children's educational television.......     0.0        0.002 
Eliminate National Information Infrastructure                           
 grant............................................     0.001      0.032 
Cut Pell grants 20 percent........................     0.250      1.24  
Eliminate education research......................     0.042      0.283 
Cut Head Start 50 percent.........................     0.840      1.8   
Eliminate meals and services for the elderly......     0.335      0.473 
Eliminate title II social service block grant.....     2.7        2.8   
Eliminate community services block grant..........     0.317      0.470 
Eliminate rehabilitation services.................     1.85       2.30  
Eliminate vocational education....................     0.176      1.2   
Reduce chapter 1, 20 percent......................     0.173      1.16  
Reduce special education, 20 percent..............     0.072      0.480 
Eliminate bilingual education.....................     0.029      0.196 
Eliminate JTPA....................................     0.250      4.5   
Eliminate child welfare services..................     0.240      0.289 
Eliminate CDC Breast Cancer Program...............     0.048      0.089 
Eliminate CDC AIDS Control Program................     0.283      0.525 
Eliminate Ryan White AIDS Program.................     0.228      0.468 
Eliminate maternal and child health...............     0.246      0.506 
Eliminate Family Planning Program.................     0.069      0.143 
Eliminate CDC Immunization Program................     0.168      0.345 
Eliminate Tuberculosis Program....................     0.042      0.087 
Eliminate Agricultural Research Service...........     0.546      0.656 
Reduce WIC, 50 percent............................     1.579      1.735 
Eliminate TEFAP--Administrative...................     0.024      0.040 
          Commodities.............................     0.025      0.025 
Reduce Cooperative State Research Service 20                            
 percent..........................................     0.044      0.070 
Reduce Animal Plant Health Inspection Service 10                        
 percent..........................................     0.036      0.044 
Reduce Food Safety Inspection Service 10 percent..     0.047      0.052 
                                                   ---------------------
    Total.........................................    36.941     58.402 
------------------------------------------------------------------------
Note.--Figures are in billions of dollars.                              

  Mr. HOLLINGS. Mr. President, I ask the Senator from Utah to come 
forward, or any Senator to come forward with a 1-year budget that puts 
us on a glide path to zero. Earlier today, Republicans were berating 
Dr. Rivlin, the Director of the Office of Management and Budget for her 
lack of budget cuts in the President's 1996 budget. But back on 
December 18, when they were feeling real bullish, Mr. Kasich, the 
distinguished chairman of the House Budget Committee now, said: ``In 
January we will really spell this out. In January I am going to bring 
to the floor a revised budget resolution.'' Further down he says: ``We 
will provide spending savings. You already have outlined them. In the 
menu list we already have two or three budgets.''
  They did not care about President Clinton or what the Director of the 
Office of Management and Budget was even thinking about. And then he 
continues:

       When that is done * * * at the same time we are going to 
     move on the glidepath to zero * * * We will take the savings 
     by cutting spending first and we are going to put them in the 
     bank so nobody across the country, nobody on Main Street, no 
     one on Wall Street is going to think we are going to do is 
     we're going to give out the goodies without cutting 
     government first.

  So I look in the bank, in the lock box. And there is one thing I 
find, Mr. President. I have the lock box that the chairman of the 
Budget Committee referred to. But the only thing it contains so far are 
a pile of Social Security IOU's.
  Mr. President, let us do like Madison admonished, let us begin to 
control ourselves. We can begin.
  As President Reagan said: If not us, who? If not now, when?
  I yield the floor.
  Several Senators addressed the Chair.
  Mr. D'AMATO. Mr. President, I know my distinguished colleague, the 
senior Senator from New York, is waiting to speak. I think he is going 
to yield me up to 10 minutes?
  The PRESIDING OFFICER. The Senator from New York.
  Mr. MOYNIHAN. Mr. President, I know my distinguished friend, the 
chairman of the Committee on Banking and Urban Affairs, has an 
important statement he wishes to make. I know it is not directly on our 
subject, but I know it is important. I want to hear him. I am sure the 
Senate will as well.
  I am happy to yield my place to him at this point.
  The PRESIDING OFFICER. The Senator from New York has the floor.
  

                          ____________________