Congressional Record, Volume 141 Issue 26 (Thursday, February 9, 1995)

[Congressional Record Volume 141, Number 26 (Thursday, February 9, 1995)]
[Senate]
[Pages S2358-S2392]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

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

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

The Senate resumed consideration of the joint resolution.

Pending:
Reid amendment No. 236, to protect the Social Security
system by excluding the receipts and outlays of Social
Security from balanced budget calculations.

Amendment No. 236

Mr. DORGAN addressed the Chair.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. DORGAN. Mr. President, what is the status of the Senate? Are we
on the Reid amendment at this point?
The PRESIDING OFFICER. The Chair did not hear the Senator.
Mr. DORGAN. Is the Senate now considering the Reid amendment?
The PRESIDING OFFICER. Yes, we are under consideration of the
amendment. There is no time controlled.
Mr. DORGAN. Mr. President, I come to the floor today to offer words
of support for the Reid amendment. I intend to vote for it, and I hope
the Senate will vote for it in sufficient numbers to add this to the
constitutional amendment to balance the budget.
(Mr. KYL assumed the chair.)
Mr. DORGAN. Let me this morning begin by talking about a woman who
many of you know; the story, of course, is legend. On December 1, 1955,
in an Alabama city, a woman had just finished her work for the day. She
was a seamstress. She was about 40 years old. She was tired, her feet
hurt; she had worked a long day, and she was on the way home.
She went back and forth to her job by bus. And on this day, at the
end of the workday, with tired feet, this woman boarded a bus and took
the first available seat. And as the bus traveled down the avenue, the
bus began to fill up. And on this day, December 1, 1955, as the last
seat was taken on the bus, a white male passenger boarded the bus and
looked at this woman, Rosa Parks, and said, ``You must leave your seat
and move to the back.''
She refused to do so. At that point in the life of this country, she
was required to ride in the back of the bus. Her dignity that day, as
well as the fact that she had worked a long day and was tired, but her
dignity especially, persuaded her to say, ``I'm not moving,'' and she
remained in her seat. Others around her began to curse her, as the
story is told. The bus driver stopped and refused to move the bus
because this woman would not move to the back of the bus and give her
seat to a white passenger.
The police were called, and Rosa Parks was arrested and thrown in
jail. Her indiscretion? She refused to give up her seat and refused to
move to the back of the bus.
Well, it is some 40 years later now, and I guess all of us would say
we are proud to understand that the quiet dignity and strength of Rosa
Parks lit a fuse that caused an explosion of understanding and, yes,
tension--but most especially understanding--that has changed things in
this country for the better. The avenue where that bus traveled on that
December day in 1955, and where that arrest was made, is now named Rosa
Parks Avenue.
Sometimes one can force change by simply refusing to move. Some say,
``Well, don't just sit there.'' Rosa Parks just sat there because she
felt she was entitled to do that, and that single act by that
courageous woman, who will live in our history, has caused substantial
change in our country.
So when they say, ``Don't just sit there,'' I think sometimes on some
issues some of us say, ``Well, wait a second; where we sit is
important.''
On this issue today of Social Security, some of us believe that where
we are in this country, with a program that is, I think, the most
significant and the most remarkable program of its kind anywhere in the
world, it is one that ought not be trifled with. It ought not be
threatened. It ought not, in our judgment, be in any way changed so
that the American people will not have confidence that Social Security
will be there when they need it.
That is why many of us feel at this point in this debate on the
constitutional amendment to balance the budget we ought not move
forward on this issue without the Reid amendment. We should add the
Reid amendment to the constitutional balanced budget amendment so that
we do not jeopardize the Social Security trust fund.
Why is it important to us? Too many Americans do not even understand
the consequences of the Social Security system or what makes it unique.
We just take it for granted.
I told my colleagues before about an experience I had one day that I
shall never forget. Some years ago, I ran out of gas in a helicopter. I
quickly learned one of the immutable laws of flying: If you are in the
air and you run out of fuel, you will land very quickly.
I, with a colleague of mine, landed in a helicopter in the jungle
terrain between Nicaragua and Honduras. Congressman Gejdenson, from
Connecticut, and I were actually down in a Contra camp, and touring
refugee camps in Central America.
We were traveling by helicopter one day. It was in August, and there
were big thunderstorms. We were over mountains and jungles, and we were
going down mountain passes, and then a big thunderstorm cell would loom
up in front of us and we would backtrack and go down another valley,
and we would backtrack again. We had been flying a long while, and the
pilot had some lights go on and some bells go off and we were running
out of fuel. They had to put the helicopter down, right now. There we
were, out of radio contact, somewhere in the mountains and jungles of
Honduras, right by the Nicaraguan border.
We were unhurt, but for a number of hours we did not know where we
were. Nor did anyone else. Other Army helicopters eventually searched
for us and found us. We were pulled out of there by other helicopters.
The point of the story is this. As we sat there on the ground, some
of the campesino families and others began walking toward us. A group
gathered to try to figure out who on Earth had come down here in this
rural stretch, in the mountains of Honduras. We had an interpreter with
us who spoke fluent Spanish. And as we were there--because no one knew
where we were, we were going to be there for awhile, and we did not
know exactly what was going to happen--we began, through the
interpreter, to talk with these people who came around to figure out
who had come down there. People I talked to--and this is something I
discussed with the interpreter during this conversation--told me
something I had never even thought about before.
I was visiting with a young woman, I guess probably 23 or 24 years
old, who had come walking through the underbrush there with some
children with her. We were just talking through an interpreter. There
was kind of a little crowd, maybe six or eight people.
I said, ``How many children do you have?''
And this very young woman said, I believe, ``Only three. Only
three.''
I said to the interpreter, ``Gee, she sounds disappointed. Lord, she
cannot be over 22 or 23 years old, and she sounds disappointed she has
only three children.''
The interpreter said, ``You do not understand. You come from a
country that has all these things--Social Security. Down here, there is
none of that. Down here there is no Social Security program. If you
grow old in some of these countries, you want to have had as many
children as you could have, so maybe enough of them will live so when
you become old, if you are lucky enough to grow old, you will have some
children surviving you who can help you in your old age. That is Social
Security.''
It was the first time I had ever thought about it. I never thought
about that before because I grew up in a country where Social Security
was just there. It was a part of our lives. We understood: When you
work, you pay in. The person who employs you pays in. And when you
retire, it is
[[Page S2359]] there. It is just taken for granted. We do not even
think much about the connection. Who made it, who created it, who
caused it, how it works--we do not think much about that. It is just
part of American life.
I mention the story today simply because there are other parts of the
world where this is a totally foreign notion. That you would have some
basic device at the end of your working life that allows you to have a
decent retirement is a novel idea in some places. That is what Social
Security is. The Social Security system is the fabric of that
guarantee.
How did we get it? How did we create it? Through a massive public
debate, during which many people said: This is socialism, this is pure
socialism. This is the worst instincts of the Democratic Party, this
Social Security nonsense.
Of course, it was not. And it has always been there. It was a useful,
necessary, important program for America's elderly that has, I think,
grown in the right way. It is now a compact between those who work and
those who retire, and it has made life in this country better for tens
of millions of Americans, year in and year out. We ought to be proud of
this program. This program works. This program worked in the past, and
it will work in the future for this country. We always ought to
understand that.
We come to this point in America's history after a couple of hundred
years of self-government--and incidentally, a couple of hundred of the
most successful years of any similar attempt at government known to
humankind. There is no other reasonably similar approach to government
that has been tried as successfully as this anywhere in human history.
In a couple of hundred years, we have had fights about public policy
back and forth, and during this time we created some things, one of
which was Social Security. During the last 15 or 20 years or so, this
country's fiscal policy, that is the spending and taxing decisions and
the system by which we decide how much to spend and how much to tax,
has gotten off track and out of balance. And this country has begun to
run up very large budget deficits. The budget deficits are not
accidental. They are a function of the Congress and the President
proposing to spend what the people largely want spent, and the Congress
and the President being reluctant to tax what the people largely don't
want taxed. So what has been the result?
The result has been that the Congress and the Presidents in about the
first 200 years or so, up until 1980, had spent $900 billion more, over
all of the years in this country's existence, $900 billion more than it
had taken in. In other words, it charged to a charge account $900
billion, because it spent money that it did not have, starting with the
beginning of the United States of America to the year 1980.
From the year 1980 to the year 1995, in the month of February, this
country added to that charge account. It is not any longer $900
billion. It is now nearly $4.8 trillion. So in nearly 200 years, the
country spent $900 billion it did not have and charged it to future
generations. And then, in 15 years, it added somewhere around $3.9
trillion and said: By the way, charge this, too. Put it on the same
account.
What do we face in the future? If you look at what the Government
does--Medicare, Medicaid, and a whole series of spending decisions and
revenues--and take a look at what the Congressional Budget Office says
will be the consequence of the current system and the current spending
levels, you will find that we will add, if nothing is done, about $4.4
trillion to the same charge account in the next 10 years. Except it
will be more than $4.4 trillion, because we have some in this Chamber
who say let us do two additional things. Let us increase defense
spending and build star wars--which is one of the goofiest ideas I have
ever heard in my entire life; that is now resurrected--let us resurrect
the strategic defense initiative or star wars at a time when there is
no Soviet Union. But leaving that aside, increase spending or cut
revenue.
So it will not be $4.4 trillion added to this charge account, added
to the already $4.8 or $4.9 trillion, so you are talking close to $10
trillion. It will be more than that. Does anybody think that represents
the right future for this country? I do not. Most of the constituents I
know do not believe it does.
So the question is, What will intervene to change it? Will it be six
people of good will finding a vacant room back here with a clean sheet
of paper and making plans, scurrying around making little plans on how
to balance the budget? I do not think so. It has not happened in the
past.
It will be people representing what their constituents are saying:
Make sure you keep these programs, now. We do not want to lose
programs. But we do not want to pay taxes, either. We do not want you
to increase them. In fact, we would like you to cut taxes.
So we have the Republican Contract With America saying let us cut
taxes. In fact, let us do it a little better; let us cut taxes mostly
for the well-to-do. Then we have some Democrats saying, let us also
have a middle-income tax cut, slightly less and differently targeted,
but the same approach, basically.
It is the same approach basically.

In the midst of all of this comes the notion that we should amend the
U.S. Constitution to require a balanced budget. I did not come here
thinking that was the necessary thing to do. I think it is pretty hard
for us to improve on the work of Washington, Mason, Franklin,
Jefferson, and others. So I did not think we should amend the
Constitution for the first few years I came to Washington. But I have
changed my mind about that. I do not think for a moment that it will
cause one penny's difference in our future budgets by itself. It is a
bunch of words that someone is going to write into the Constitution.
Everybody here who will vote for this understands it will not cause one
penny's difference in the budget deficit. It may ratchet up slightly
more pressure for decision making in both the House and the Senate that
will lead we hope toward a balanced budget. That may be what happens.
If that happens, then I am for anything that turns up the heat,
anything that ratchets up the pressure, because frankly, we cannot
continue going down this road.
There must be a reconciliation in this country between what we spend
and who we spend it for, and what this country is willing to pay for.
You just cannot keep having Government that we are not willing to
finance.
I know polls show the American people think half of the money spent
by the Federal Government is wasted. It is not. This is not money
someone buries in their backyard or puts in a sock under a mattress.
Most of this money goes out in the form of entitlement programs one way
or the other or goes to pay for defense. If you take Medicaid,
Medicare, interest on the national debt, defense, and Social Security,
you have three-fourths of every dollar the Federal Government spends.
So we have to force a reconciliation of what we spend and what kind of
resources we have so that we get back some notion of fiscal policy
balance to assure this country's economic future.
Why is it important to put an amendment in this that says let us not
raid the Social Security trust funds as we do that? For this simple
reason: Not one penny of the Federal deficit has been caused by the
Social Security system; not one. This year the Federal budget is going
to have a significant deficit but the Social Security system is going
to collect nearly $70 billion more than it spends. Why?
I was a part of the group that in 1983 wrote the plan that required
this surplus. I helped write the Social Security reform plan. We wanted
to enforce national savings so that when the baby boomers retire after
the turn of the century we would have savings accumulated to deal with
that. After the folks came home in the Second World War, not
surprisingly, I guess, we had the biggest baby crop in the history of
this country called the war babies. When that generation begins to
retire, we will have maximum strain on the Social Security system.
The point of the 1983 reform bill was to force some national savings
to be available for the baby boomers' retirement. If we do not put the
Reid amendment in this constitutional amendment, the potential will
exist that those who want to balance the budget by using the Social
Security trust fund will simply raid the fund to balance the budget.
[[Page S2360]] The problem about that is it breaks the fundamental
promise, that we take the money from paychecks of the people who work,
we put it in a trust fund dedicated for only one purpose. The tax is
dedicated. The trust fund is dedicated, and that is to pay for the
Social Security system. If we have to at some point adjust the Social
Security system, it ought to be adjusted based on the internal
mechanics of the system. Is it well financed or not? If not, let us
deal with it based on the actuarial notion of the system. But let us
not decide to raid this enormously successful program, which needs all
these savings for the time when the baby boomers retire, and decide to
use that money to balance the budget. That breaks the promise it seems
to me that we have with the American people.
Let me mention one other thing because we talk about this always in
such an antiseptic way. It is always policy and numbers. I mean, it
sounds like it is all sterilized. This is about people. It is about how
people live. Every single one of us have constituents who tell us
stories that bring tears to our eyes as we leave a meeting or leave a
discussion with someone.
I once spoke with a woman who is 82 years old, who has diabetes and
heart trouble, and whose only revenue and only resource in life is the
Social Security check she gets. The Social Security check is somewhere
around $380, I think she told me. Then she has to buy a medicine to
deal with her heart problem and her diabetes, pay rent, and buy
groceries. She said to me, ``I cannot afford to buy the medicine for my
diabetes and the heart trouble.'' So the doctor prescribed it. And she
said, ``I have to take it. So I buy the medicine. Then I cut the pills
in half and take half as much as he recommends so the medicine will
last twice as long. It is the only way I can afford my medicine.
Otherwise, I cannot eat.''
Your heart bleeds for someone who is 82 and finds herself in that
circumstance. Think of how important that Social Security check is. It
is her lifeline. It is the only thing she has. Before Social Security,
people like her were just desperately poor, consigned to poorhouses or
consigned to begging for food or shelter.
The Social Security system, as inadequate as it might be to deal with
all the problems, is something that is enormously important in this
country. And we must, all of us, make certain that system is protected
and available with its resources for the future. I have heard dozens of
times people say, ``The Social Security system will not be there when I
retire.'' They have said that every decade since the 1930's. It has
been there in every decade, and it will be there in every decade in the
future. That is a plain fact.
I hope that, as we consider this amendment, we will have an up-or-
down vote on the merits of this amendment. I am not asking for five
reasons someone would want to vote against it. Just give me one good
reason. There could only be one good reason that one would not want to
support the Reid amendment, and that is because someone does not want
to use those massive amounts of dollars we are accumulating to be
available for the baby boomers. They want to use them for some other
purpose. That is the reason this is a critically important amendment.
I know others want to speak. I have gone on at some length. I hope
that we will have an up-or-down vote on this amendment, and I hope
Members of the Senate will come to this Chamber and register yes or no.
This is not rocket science. This question does not require a great deal
of understanding to understand the implications.
Do you want to use the revenue that is in the Social Security trust
funds to balance the budget? Do you want to break the promise? Do you
want to raid the trust funds, or do you not? If you do not, then vote
for the Reid amendment. If you do, then find devices to try to defeat
this thing. But then understand what the purpose of trying to defeat it
really is.
If you decide you want to keep a promise--and we should in this
country--then let us pass the Reid amendment. Then let us pass this
Constitutional amendment to balance the budget. I know it is not going
to balance the budget. It will require more than that. But it if turns
up the pressure some, I am for it. But let us do it the right way, and
let us do it soon.
I hope when the vote is complete we will find in a bipartisan way
Members who will answer this simple question with a simple answer. No.
We do not intend to raid the Social Security trust funds to deal with
this budget deficit because it will not be fair, and it will not be the
right thing to do for this country's future.
Mr. President, I yield the floor.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Florida.
Mr. GRAHAM. Thank you, Mr. President.
Mr. President, I am moved by the eloquence of our colleague from
North Dakota. He is talking about the way in which our elderly were
treated prior to the establishment of programs such as Social Security
and Medicare, programs that gave the elderly dignity and respect.
I was born in November 1936. My father was elected to the Florida
State Senate in November 1936. The reason that he ran in that year was
in large part because he had the occasion to visit some of the Florida
State mental hospitals. The term mental hospital was a misnomer for
those Florida institutions in the mid-1930's. They were really places
where people put their aged, those who they could not afford to
maintain, those who needed special help more than mental health
concerns. They were warehoused in our State's mental institutions. The
words ``snake pit'' were appropriately applied to those institutions.
One of his goals in running for the State Senate was to bring some
greater degree of dignity to indigent older Floridians by providing
them a somewhat adequate monthly stipend in their old age.
That limited effort was then subsumed in the national effort to
create social security, which has, in a period of now almost three
generations, given what had been the poorest group of Americans, older
Americans, the ability to live the balance of their lives with some
degree of dignity and respect.
We should be proud with what we have accomplished since 1935 in terms
of making that kind of opportunity available for millions of Americans,
and the prospect of it being available for millions of Americans in the
future.
But before turning to the specific issues that I think are raised in
this constitutional amendment as it relates to Social Security, I would
like to make a few comments on the underlying amendment itself. I have
in the past spoken and voted in favor of propositions which would
provide for a constitutional requirement that there be a balanced
Federal budget. I shall do so again with the same degree of
disappointment that I have done in the past.
Passing a constitutional amendment to require us to balance the
Federal budget is a blatant statement of failure. We are admitting our
inability, without this type of discipline, without this constitutional
shackle, to do what we should have done and what, frankly, most
generations of Americans have done, and that is, to exercise fiscal
responsibility.
Up until 1980, the U.S. Government had accumulated a national debt of
slightly over $900 billion. We fought World War II, World War I, we
lived through the Great Depression, just to mention three events of
this century. We lived through all of these events and accumulated a
national debt of $900 billion. Since 1980, we have added to the
national debt approximately $4 trillion. We will soon be asked to vote
on a national debt limit that would allow us to exceed the $5 trillion
level in terms of national indebtedness. We have had a free-fall of
excess in terms of our national fiscal policy. I wish I could say that
I saw something on the horizon that indicated we were about to reverse
that pattern, and that we would not need a constitutional amendment to
require us to do what our forefathers had been able to do without a
constitutional amendment. I am afraid, however, Mr. President, that I
do not see any indication that we are about to reverse this policy of
the last 15 years.
In fact, to the contrary, I see new evidences of irresponsibility. To
mention one, the Contract With America contains provisions for a series
of tax
[[Page S2361]] reductions; each one of which is popular. Everyone
would like to pay less toward the cost of Government. It has, however,
been a pleasant period in the United States, in which Americans have
experienced high levels of services, relatively moderate levels of
taxation, and a series of tax cuts over the past 15 years, all while
letting our grandchildren pay the bills. The Contract With America
would continue that. It calls for over $700 billion of additional tax
cuts in the next 10 years; $700 billion would be added to our already
staggering estimated deficits for the next 10 years. To me, that is
just one indication of the fact that we do not have any reason to
believe that we are about to exercise voluntary discipline. Therefore,
it will be necessary for us to impose upon ourselves and the future of
America a constitutional requirement to do what we ought to be doing.
It is a matter of our generation's responsibility.
I believe that there are several important objectives to be
accomplished by this constitutional amendment. One of those is to
reestablish the principle of generational responsibility. When I was
born, we were not leaving to our future generations massive debts. Our
parents and grandparents and great-grandparents had paid their own
bills. They believed in the principle of generational responsibility.
That will be reestablished with this constitutional amendment. We will
also heighten our sense of accountability, that it is our
responsibility to be accountable for how we handle the Nation's fiscal
affairs.
How do these principles, these goals, relate to the issue of how
Social Security should be treated in a balanced budget amendment? As
previous speakers have so appropriately and eloquently stated, Social
Security is a contract, a contract between the Government of the United
States and the people of the United States. It is a very solemn trust
that we hold. The lives of millions of Americans are affected very
directly by their belief in our trusteeship and how, in fact, we carry
out that trusteeship.
Giving Social Security special treatment within this constitutional
amendment would be a statement to the American people of our
understanding of that trusteeship.
Mr. President, there is also another factor--I apologize if what I am
about to say is a little bit tedious and technical, but I think it
bears repeating--and that is the special financial structure that we
have created for Social Security and how that financial structure
relates to the issue of the appropriateness of having Social Security
excluded, treated separately, for the purposes of the balanced budget
amendment.
Prior to 1983, Social Security was like most other trust funds in the
United States. It was a pay-as-you-go system. As, for example, with the
highway trust fund, dollars are collected each year based on the amount
that is paid in gasoline tax. That money goes into a trust fund. Those
trust funds are then appropriated to States or to specific
transportation projects. There is an in-go and out-go that is balanced
almost on an annual basis. That was the way Social Security was treated
up until 1983.
In the years prior to 1983, there was a recognition that Social
Security was facing some very serious financial problems. One of those
problems was that the Social Security system was very much the captive
of the change in the U.S. birthrate. I happen to have been born in
1936, a period of relatively low births in the United States. Not very
many babies were born proportionately during the Depression. Therefore,
as my generation enters the time when it will become eligible for
Social Security benefits, we are not going to impose a very heavy
burden on the Social Security system. Conversely, when my children, who
were born in the 1960's, a time with a relatively high birthrate, enter
Social Security, there will be a very heavy demand imposed on the
system. And so the fundamental change made in 1983 was to move Social
Security from a pay-as-you-go system to what is referred to as a
surplus system, much like other forms of life insurance or annuities.
That is, dollars were to be built up during the period of low demand on
Social Security, so that when we reach the point that there would be
heavy demand, there would be the resources available to pay those
benefits.
This chart, Mr. President, illustrates how that Social Security
surplus system is intended to work. Beginning with this year, 1995, we
will have a surplus of something in the range of $70 to $80 billion. We
have had a surplus built up since 1983 of approximately $400 billion.
We are going to be adding substantially to that amount over the next 20
or so years, reaching a peak of having a surplus of approximately $3
trillion.
Then, in about the year 2019, we will start a rapid draw-down. In a
period of a decade, we will deplete that $3 trillion of surplus and
zero out the account to meet the demands of that large group of
Americans who will reach retirement age in approximately 2019 forward.
Now what is the significance of this structure of Social Security
financing, which represents approximately 25 percent of the
expenditures of the Federal Government? What are the implications of
this financing structure to the balanced budget amendment?
I describe the implication as being the mask and then the hammer.
From now until the year 2019, because the way our deficit is reported,
where annual surpluses constitute a subtraction from our stated
deficit, the surpluses will mask the Federal deficit.
We talk about the deficit in the current budget as submitted by the
President as being approximately $190 billion. That is not totally
correct. Actually, the deficit for the Federal Government in 1995-96
will be $190 billion plus $80 billion, the Social Security surplus.
Because the way we report under our accounting system, that $80 billion
of surplus in the Social Security trust fund is subtracted from the
overall deficit.
It would be somewhat like a family which had an income of, let us say
$40,000, but had expenditures of $50,000. It would appear as if they
were running every year $10,000 in the red. But they had a rich uncle
who had died and left them a trust fund which each year gave them for
the next 10 years $20,000 out of that trust. If they reported in their
accounting that they made $40,000, spent $50,000, but had $20,000 in
the trust fund, it would appear as if they actually had a $10,000
positive each year. Of course, the problem is, when the trust fund runs
out in 10 years, they are going to be back to where they were
initially, except probably worse off because they had become accustomed
to having this $20,000 trust fund.
We are somewhat in that same situation. We are masking the real
extent of our fiscal problem by every year pumping in the novocaine of
a substantial Social Security surplus.
And what is the hammer? The hammer is what happens after the year
2019 when every year we are going to start our Federal accounts with a
deficit of, in some years, in the range of $350 to $400 billion.
How would you like to be sitting here in the year 2023 with a
constitutional amendment that says you have to balance your books every
year and you begin the process with a deficit of $350 to $400 billion
because of the enormous outflows from the Social Security trust fund?
I believe, Mr. President, that if we write into the Constitution that
we must have a budget system that consolidates Social Security,
representing 25 percent of our expenditures, into all the rest of the
financial activities of the Federal Government, that under this
structure, we are going to be leaving our future generations with an
enormous, impossible task, particularly in these outyears.
And let me point out, this is not an aberration. This outline of
surpluses and then deficits of Social Security is not a mistake. This
is the way the system was planned to operate. It mirrors the
demographics of the country--relatively low numbers of persons in
retirement age at the beginning of the 21st century and large numbers
of persons in retirement age in the second quarter of the 21st century.
This is the way the system is supposed to work.
When you apply that against the mandate of a balanced budget, if
Social Security is consolidated into every other account in the Federal
Government, you will create a fiscal impossibility.
Next, if Social Security is on budget, it is going to create a
temptation to
[[Page S2362]] manipulate Social Security for the purpose of further
masking the extent of our financial problems.
To use one example. It was only a couple of years ago that there was
serious discussion in this Chamber of eliminating the cost-of-living
adjustment for Social Security beneficiaries. I think, wisely, that
proposal was rejected. But why was it being proposed? It was being
proposed because, if you eliminated the cost-of-living adjustment,
which amounts to approximately $20 to $30 billion a year in terms of
Social Security expenditures, if you eliminated that cost-of-living
adjustment, you would have artificially made the surplus appear that
much larger.
If we did not pay a COLA out in 1995, we would not be talking about a
surplus of $80 billion. We would be talking about a surplus of close to
$100 billion. That would mean that our stated deficit would be $20
billion less.
So with that one action, we would have cut the reported Federal
deficit, the deficit for purposes of meeting this constitutional
requirement, by $20 billion.
That is the temptation that we are going to have because it is will
be such an easy, disguised way, in which to meet the standard that we
are setting for ourselves of a balanced Federal budget.
Next, I think that the consequence of what I just described--the
temptation to use Social Security with this kind of a financing system
to artificially reduce the stated Federal deficits--the consequence of
that is to increasingly shift the cost of other areas of Federal
responsibility to the Social Security financing system, which means
shifting it to one of the most regressive sources of Federal revenue--
the payroll tax.
The payroll tax is a straight tax on the payroll of most Americans,
without regard to their ability to pay or other considerations. There
are no deductions, there are no credits, there are no other recognition
of special circumstances with the payroll tax. And as we give into the
temptation to use Social Security as a means of meeting our other
responsibilities, we continue to add to the extent by which Government
is being financed by its most regressive form of revenue.
Next, I believe that one of the positive benefits of taking Social
Security out of the general revenue budget of the United States--doing
as Senator Reid proposes--is that we will have the happy prospect of
actually running a surplus in terms of our overall Federal condition
once we are able to balance our general revenue books. Once we are able
to get the rest of the Federal Government into a balance situation,
with Social Security operating at a surplus, then we will be able to
begin to reduce the amount of the national debt which is held by the
general public.
We will begin to get some of those benefits that a positive surplus
in our fiscal accounts will bring, such as lower interest rates, or
stable interest rates, the benefits that will come in terms of stronger
economic growth.
Finally, Mr. President, I believe it is important that we separate
Social Security from the general revenue because we have a lot of work
to do on Social Security. I have outlined briefly what the structure
is.
There is an implicit assumption in that structure; that is, that the
surplus funds that we are accumulating, what will eventually amount to
$3 trillion of surplus, is being invested in an area that will be
available for liquidation and used to pay these benefits that are going
to be due after the year 2019, just as a private pension fund takes the
money that it collects every year from employers and employees, however
it is structured, and invests it in stocks, bonds, public instruments,
or private funds so that when people retire there will be some real
money there to pay their pension. The assumption is that something like
that has happened with Social Security. Wrong. What is happening with
the Social Security surplus is it is being used to finance the very
deficits that we are trying to eliminate.
One of the benefits of having Social Security and the rest of the
Federal Government's financial problems separated is it allows the
Senate to focus attention on dealing with Social Security, making it
the kind of solid, predictable, reliable, sustainable source of
economic security for older Americans that we have represented it to
be.
As long as the two are melded together, I think we will be constantly
under the microscope of suspicion that we are doing it not to help
Social Security but to raid Social Security.
We, as good physicians who need to make accurate diagnoses and
prescriptions for Social Security, need to be in a surgery ward where
we are not subject to the attack or criticism or suspicion that we are
not doing this out of the desire to raid Social Security, that we
clearly are doing it for only the purpose of making Social Security
strong, healthy, vigorous, and able to carry out its contractual
responsibilities.
Mr. President, I believe this is an extremely important issue that we
are discussing and that it is imperative that we adopt the amendment as
offered by the Senator from Nevada if we are to carry out our
responsibilities not just for today, but particularly for the long
future.
We have only amended the U.S. Constitution a few times in our 200-
plus year history. It is interesting that only one of those amendments,
once adopted, was repealed. That was the amendment on prohibition.
Every other amendment, once adopted, has stayed in the Constitution and
stayed in the original form. We are not doing this just for 1996 or
1997; we are doing this for the years 2096, 2097.
What is in the best interest of Americans over that long, indefinite
future? I believe it is in the best interest of Americans to adopt the
discipline of a balanced budget amendment, but to exclude the one-
fourth of our Federal expenditures that represent Social Security, for
the reasons that I have outlined, but particularly for the mask and the
hammer we are about to leave for future generations if we require,
constitutionally, that Social Security be consolidated with the rest of
the Federal Government.
Let me conclude with a few recommendations. One, if we exclude Social
Security from the consolidated budget, I think that we need to look at
the question of whether the year 2002 is still an appropriate year for
a mandated balanced budget. I believe that we should stretch that
period out probably an additional 2 to 4 years, recognizing the fact
that we are not going to have the Social Security surpluses as a means
of offsetting deficits, and that we do not want to create an undue
shock to our economic system and create the possibility of
unintentionally putting the United States into a recessionary period.
If we do not adopt Senator Reid's amendment, I think we will need to
think seriously about going back to the pay-as-you-go approach to
Social Security that we had prior to 1983. I do not believe that the
current system is sustainable within a consolidated Federal budget and
a constitutional mandate that budget be balanced beginning in the year
2002.
Mr. President, I appreciate the opportunity to make these remarks. I
commend the Senator from Nevada and also the Senator from California
and others who have brought this matter so appropriately and so
vigorously to our attention. It is an extremely important matter. It is
not one that needs to be treated as if it can be dealt with by a
cosmetic or other surface resolution.
This is a fundamental issue of our future ability to treat Americans
who have relied upon the ``contract with America''--that is, Social
Security--and to be able to give to our future generations a financial
plan for which they will be able to achieve the objectives, including
balancing the general revenue budget of the Federal Government, the
benefits of having the surplus from the Social Security fund to be used
to invigorate our economy rather than to mask our profligate spending,
and to give Members an environment in which we can do those things
which will be necessary to assure the long-term strength of Social
Security.
Mr. President, I urge my colleagues to adopt the amendment.
Mrs. FEINSTEIN addressed the Chair.
The PRESIDING OFFICER. The Senator from California.
Mrs. FEINSTEIN. Mr. President, this constitutional balanced budget
amendment is a very big issue. Its impacts are enormous. Its results,
if passed and enacted, will be large and long remembered.
[[Page S2363]] Support for a Balanced Budget Amendment

There are two reasons I want to vote for a balanced budget amendment.
The first is my own life experience. I shared this once before and I
will do it once again. The year I was born, 61 years ago, the entire
Federal debt amounted to just $25 billion. When my daughter was born,
the entire Federal debt amounted to $225 billion. And 2 years ago, when
my granddaughter, Eileen, was born, the entire Federal debt was 150
times greater than when I was born. It was nearly $4 trillion at that
time.
So my life experience shows me that with business as usual, the
Congress is not going to be able to deal with the deficit unless it is
forced to.
The second reason is my Senate experience. In 2 years in the Senate,
through my observation of the budget's authorization and appropriation
processes, I have become convinced that a balanced budget amendment is
in order. In short, current operating procedures will not, in my view,
produce a balanced budget. The amendment, therefore, is necessary to
face reality and make the difficult decisions.
In a nutshell, those are the reasons I want to support a strong
balanced budget amendment. But I want to support the right balanced
budget amendment. And I have a hard time agreeing with those who have
deemed it must have exactly only certain words in it; and only those
words.
Last year, I supported the Reid balanced budget amendment on Social
Security, as I am today.
Mr. REID. Mr. President, will the Senator from California yield for a
brief question?
Mrs. FEINSTEIN. Yes, I will.
Mr. REID. Mr. President, I want to make sure that the Record is
complete and my words are on the Record while the Senator from
California is speaking.
The Senator has done a remarkably good job keeping this issue before
the public. The Senator, as a member of the Judiciary Committee,
singlehandedly brought this to the Senate a few weeks ago, where it was
fully debated in the Judiciary Committee.
As a result of the work the Senator has done, my work here, and that
of those other cosponsors, including the Senator from California, has
been made a lot easier.
I wanted to publicly commend and applaud the Senator from California
for her yeoman's work in regard to excluding Social Security from the
balanced budget amendment.
Mrs. FEINSTEIN. I thank the Senator from Nevada for those very
generous words. I appreciate them very much.
Mr. President, last year I supported both these amendments. In the
ensuing year, I have come to think a lot about it. It is a long time
before ratification, even if a balanced budget amendment is passed. And
when people, beginning with 40 million and then 60 million, then 70
million, then 80 million Americans on Social Security understand what
the impact of this amendment is, it is my very deep belief that it will
not be ratified. I view the use of Social Security surplus revenues as
a major flaw in the balanced budget amendment, but it is a flaw that
can be corrected by this amendment.
In 1990, this very body, by a vote of 98-2, voted to take it off
budget. They said:

Notwithstanding any other provision of law, the receipts
and disbursements of the Federal Old-Age and Survivors
Insurance Trust Fund and the Federal Disability Insurance
Trust Fund shall not be counted as new budget authority,
outlays, receipts, or deficit or surplus for purposes of
(1) the budget of the United States,
(2) the congressional budget, or,
(3) the Balanced Budget and Emergency Deficit Control Act
of 1985.

This body voted for it 98-2. And in the ensuing days, this body is
going to reverse their opinion. One must ask why? Why are we doing
this?

FICA Taxes

Let me talk for a moment about FICA taxes and what they are.
By the year 2017, $3 trillion of FICA tax reserves meant to pay for
the retirements of American workers will be used instead to balance the
budget. This is unconscionable.
If Congress is going to use FICA taxes that are meant for retirements
for another purpose other than retirements, we should cut the FICA tax
to eliminate the surplus so people do not see their FICA taxes misused.
FICA taxes were raised in 1977 and 1983 so the Social Security system
would run surpluses. It was changed at that point from a pay-as-you-go
system to a system that would bank surpluses for the future.
Why was that done? It was done because the actuarial tables showed
there was going to be a major baby boomer generation retiring in the
not to distant future and the revenues, as projected, would not be
adequate to meet their retirements. Therefore, it was thought by this
esteemed body that we should increase retirement taxes so that moneys
could accrue and there would, therefore, be enough money to meet the
retirement needs of the baby boomer generation.
What has changed is we found that even without this amendment,
downstream, after the year 2018, the Social Security system will run
into trouble. There still will not be enough money. But, if these
dollars are used to balance the budget, the system is going to run into
trouble much more rapidly. By 2002 nearly $1 trillion will be used and
by 2017, nearly $3 trillion if we don't start saving these Social
Security surpluses.
There are those who say, ``That's OK, we'll use the revenues. It will
force us to make necessary changes in the system.'' I agree we have to
make some changes in the system. If you raise FICA tax, if you means
test it, whatever you do with it, some changes are going to happen.
But to use the reserves to fund health, to use FICA taxes to fund the
Interior Department, the Agriculture Department, defense, and interest
on the debt and other Government programs, is just plain wrong.
Over 58 percent of working Americans today pay more in FICA taxes if
you put in the employer share than they do in Federal taxes. This is
not a small amount. This tax is not adjusted by salary. Everyone pays a
flat tax of 6.2 percent up to $61,200 of income and the employer
matches it with 6.2 percent. For a worker who makes $25,000, his share
is $1,550. Combined with the employer tax, it is $3,100. For a worker
who makes $35,000, when you combine it with the employer's share, it is
$4,340. Go up another $10,000 to $45,000 and combine it, it is $5,580.
Go up another $10,000 to $55,000 and combine it and it begins to grow,
it is $6,000 a year. And for every worker who makes more than $61,200,
combined it is $7,588.
That is a lot of money at any income level. If it is being saved for
retirement, then it is like an annuity: That's fine. You pay in funds
and you get them out when you retire. But if it is being spent on
Government, then it is just another expensive tax on working Americans,
and then we ought to do the right thing and reduce the FICA tax if we
are going to do this.

Social Security Amendment

The debate over this amendment to exclude Social Security from the
constitutional balanced budget amendment is not complicated. It is very
simple. The issue is: Does Congress want to take the funds generated by
the FICA tax for Social Security, meant for a worker's future
retirement, and use it to balance the budget? Or does Congress want to
balance the budget honestly?
I hope that whatever else our disagreements are, we can all agree
that Social Security revenues from the FICA tax should not be misused
to balance the budget.
My problem with this constitutional amendment is that by including
Social Security in the amendment, it does not only permit the use of
the Social Security trust funds to balance the budget, but it mandates
it by including those funds in the budget calculations. The amendment
before us, in effect, enshrines the use of Social Security to balance
the budget in the Constitution of the United States. Do we really want
to do that? I think not.
So the debate really is not over who wants to protect Social Security
and who does not. It is about who wants to be honest with the American
people in our budgeting and our fiscal policy and who does not. Because
to be honest, Social Security should remain off budget.
Ninety-eight Members of this very body voted to do that in 1990.
Including it in the budget would be an enormous loophole. It is not the
Federal Government's money, and it should not be used as if it were.
[[Page S2364]] Rebuttals

Let me respond to four arguments raised against this Social Security
amendment.

Charge One

Excluding Social Security would make it harder to balance the budget.
That is true. Taking Social Security off budget does require more
spending cuts, about $3 trillion of them by the year 2017, because all
of this money will be used to balance the budget. But the alternative
of leaving it on budget is basically stealing from Social Security to
avoid spending cuts.
There is nothing magical, as the distinguished Senator from Florida
pointed out, about the year 2002. Somebody just sat down and decided we
have to do this by the year 2002. The Sun is not going to refuse to
come up in the year 2003 or 2004 or 2005 or 2006 or 2007. If people are
really concerned that we need to use Social Security revenues or you
cannot balance the budget, then it is simple: Extend the time line out
to 2005 or 2007 rather than loot Social Security.
If a man runs short on money one month, the law does not allow him to
steal from his neighbor to make ends meet. But this amendment allows
the Federal Government to steal from Social Security to meet its
obligations. How is that right?

Charge Two

It is unprecedented to put a statute in the Constitution of the
United States.
I have heard that mentioned time and time again on this very floor.
Now, of course, it is true, it is unprecedented. It is also true that
it is unprecedented to put the Nation's fiscal policy into the
Constitution. And if we decide that this Nation needs the strong
medicine of a balanced budget amendment, then we better be sure that
the amendment is drawn deeply enough and widely enough to represent
some of these concerns.
The legislation before you is narrowly drawn, and it specifies that
only those funds used to provide old age and survivors and disabilities
benefits are involved. So it is not a loophole.
The distinguished chairman of the Judiciary Committee, whom I deeply
respect, has said, well, a game will be played if we put the words
Social Security in the Constitution. Education moneys will be called
Social Security moneys. The amendment is drafted to be specific, to
prevent this from happening, and it does.
Now, Chairman Hatch has also said that no one wants to use Social
Security revenues to balance the budget, and we could protect them in
implementation legislation or by some other resolution.
I initially thought, well, maybe that is a great idea. If we can do
it that way, why not do it. And so we asked the Congressional Research
Service, if that could be done.
I wish to read the reply I received. This is what it says:

If the proposed amendment was ratified, then Congress would
appear to be without the authority to exclude the Social
Security trust funds from the calculations of total receipts
and outlays under section 1 of the balanced budget amendment.

Mr. President, I ask unanimous consent that the communication from
the American Law Division of the Congressional Research Service be
printed in full in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

Congressional Research Service,

The Library of Congress,

Washington, DC, February 6, 1995.
To: Senator Dianne Feinstein (Attention: Mark Kadesh).
From: American Law Division.
Subject: Whether the Social Security trust funds can be
excluded from the calculations required by the proposed
balanced budget amendment.

This is to respond to your request to evaluate whether
Congress could by statute or resolution provide that certain
outlays or receipts would not be included within the term
``total outlays and receipts'' as used in the proposed
Balance Budget Amendment. Specifically, you requested an
analysis as to whether the Federal Old-Age and Survivors
Insurance Trust Fund and the Federal Disability Insurance
Trust Fund could be exempted from the calculation necessary
to determine compliance with the constitutional amendment
proposed in H.J. Res. 1, which provides that total
expenditures will not exceed total outlays.\1\
Section 1 of H.J. Res. 1, as placed on the Senate Calendar,
provides that total outlays for any fiscal year will not
exceed total receipts for that fiscal year, unless authorized
by three-fifths of the whole number of each House of
Congress. The resolution also states that total receipts
shall include all receipts of the United States Government
except those derived from borrowing, and that total outlays
shall include all outlays of the United States Government
except for those used for repayment of debt principal. These
requirements can be waived during periods of war or serious
threats to national security.
Under the proposed language, it would appear that the
receipts received by the United States which go to the
Federal Old-Age and Survivors Insurance Trust Fund and the
Federal Disability Insurance Trust Fund would be included in
the calculations of total receipts, and that payments from
those funds would similarly be considered in the calculation
of total outlays. This is confirmed by the House Report
issued with H.J. Res. 1.\2\ Thus, if the proposed amendment
was ratified, then Congress would appear to be without the
authority to exclude the Social Security Trust Funds from the
calculations of total receipts and outlays under section 1 of
the amendment.\3\

Kenneth R. Thomas,
Legislative Attorney, American Law Division.
footnotes

\1\H.J. Res. 1, 104th Congress, 1st Sess. (January 27, 1995)
provides the following proposed constitutional amendment--
Section 1. Total outlays for any fiscal year shall not exceed
total receipts for that fiscal year, unless three-fifths of
the whole number of each House of Congress shall provide by
law for a specific excess of outlays over receipts by a
rollcall vote.
Section 2. The limit on the debt of the United States held by
the public shall not be increased, unless three-fifths of the
whole number of each House shall provide by law for such an
increase by a rollcall vote.
Section 3. Prior to each fiscal year, the President shall
transmit to the Congress a proposed budget for the United
States Government for that fiscal year in which total outlays
do not exceed total receipts.
Section 4. No bill to increase revenue shall become law
unless approved by a majority of the whole number of each
House by a rollcall vote.
Section 5. The Congress may waive the provisions of this
article for any fiscal year in which a declaration of war is
in effect. The provisions of this article may be waived for
any fiscal year in which the United States is engaged in
military conflict which causes an imminent and serious
military threat to national security and is so declared by a
joint resolution, adopted by a majority of the whole number
of each House, which becomes law.
Section 6. The Congress shall enforce and implement this
article by appropriate legislation, which may rely on
estimates of outlays and receipts.
Section 7. Total receipts shall include all receipts of the
United States Government except those derived from borrowing.
Total outlays shall include all outlays of the United States
Government except for those for repayment of debt principal.
Section 8. This article shall take effect beginning with
fiscal year 2002 or with the second fiscal year beginning
after its ratification, whichever is later.
\2\House Rept. 104-3, 104th Congress, 1st Session states the
following:
The Committee concluded that exempting Social Security from
computations of receipts and outlays would not be helpful to
Social Security beneficiaries. Although Social Security
accounts are running a surplus at this time, the situation is
expected to change in the future with a Social Security
related deficit developing. If we exclude Social Security
from balanced budget computations, Congress will not have to
make adjustments elsewhere in the budget to compensate for
this projected deficit * * *. Id. at 11.
It should also be noted that an amendment by Representative
Frank to exempt the Federal Old-Age and Survivors Insurance
Trust Fund and the Federal Disability Insurance Trust Fund
from total receipts and total outlays was defeated in
committee by a 16-19 rollcall vote. Id. at 14. A similar
amendment by Representative Conyers was defeated in the
House, 141 Cong. Rec. H741 (daily ed. January 23, 1995), as
was an amendment by Representative Wise. Id. at H731.
\3\Although the Congress is given the authority to implement
this article by appropriate legislation, there is no
indication that the Congress would have the authority to pass
legislation which conflicts with the provisions of the
amendment.

Mrs. FEINSTEIN. This means then that Congress does not have the
option of later excluding Social Security in implementation language.
We simply do not have it. Therefore, unless Congress enacts this
amendment, Social Security funds will be used to balance the budget.
No other way around it. No talk is going to change it. No pounding
the breast is going to change it. No vows taken with blood or wine or
anything else is going to change it. It will be enshrined in the
Constitution of the United States and $3 trillion of money paid in FICA
taxes by young people in this country, working men and women, will be
used to pay for agriculture, to pay for HUD, to pay for education, to
pay for this highway project or that highway project.
I believe that is violative of a public trust, and I believe that
what this amendment is all about should not be to gut Social Security,
and that is exactly what we would be doing, if we don't exclude Social
Security.
So we have taken care of that argument. Congress does not have the
option of later excluding Social Security in implementation language.
It is very clear. A vote for a balanced budget amendment that does
not have this amendment in it is clearly a vote that puts Social
Security on budget and takes its surplus. Let there be no doubt about
it.
[[Page S2365]] Charge Three

Exempting Social Security could create a Social Security deficit.
Actually, the exact opposite is true. Excluding Social Security from
the balanced budget amendment protects it while including it in the
balanced budget amendment guts it. If you put Social Security in the
budget, it is not to protect it. It is to use its revenues and thus
increase its insolvency.
In 60 years of Social Security history, the trust funds have never
run a deficit. They cannot. If trust funds run out of money, benefits
cannot be paid. It is that simple and straightforward.

Charge Four

Excluding Social Security would allow the Government to gamble with
Social Security funds.
According to the Republican policy committee report, and I quote,

Congress might stop using Social Security surpluses to buy
Government securities and let the Social Security trustees
try their hand in the private market. They could start
gambling with trust fund reserves by acquiring industries,
buying up real estate, taking a chance on cattle futures or
speculating on foreign currencies.

Mr. President, to that I say nonsense. To that I say baloney. That is
pure flimflam. Social Security is off budget today, and the trust funds
are not allowed to be invested anywhere except U.S. Treasury bonds. And
they are the safest investment in the world. If they go, our Government
goes.
Social Security has never been allowed, nor will it ever be allowed
under this amendment, to use trust fund reserves to buy up real estate
or cattle futures or to speculate on foreign currencies. This charge is
pure obfuscation. It is pure fantasy.
Under this amendment, Social Security would still be required to
invest in U.S. Treasury bonds, and there is nearly $5 trillion today of
Federal governmental debt. The U.S. Treasury will continue to issue
bonds and Social Security will continue to purchase those bonds.
The biggest difference between the practice today and the practice if
the balanced budget amendment excluding Social Security is adopted is
that when the constitutional amendment takes effect, the U.S. deficit
will actually shrink--shrink--for nearly the next two decades, not
grow.
And to my mind that is fiscally prudent. As the debt shrinks,
interest rates drop. This means businesses can expand and hire new
workers, Americans can afford new homes and pay for college for their
children. Shrinking the debt is the right objective, and that will
happen under this amendment for the next two decades.
Mr. President, in conclusion. I have listened to all the arguments
about what is wrong with our amendment to exclude Social Security, but
they all boil down to one thing: Members of Congress simply want to use
the money to balance the budget.
That is not a real argument. That is a failure to deal truthfully
with the American people. To loot Social Security is morally wrong and
I cannot support it.
I want to support, as I said before, a balanced budget amendment and
I am prepared to do so if Social Security is excluded. Rather than
argue about this amendment, my colleagues who support a constitutional
balanced budget amendment as I do, why not do the right thing and
accept this amendment to exclude Social Security? Then we can move
forward in a bipartisan way and get this country back on the right
track again.
Mr. President, I yield the floor.
Several Senators addressed the Chair.
The PRESIDING OFFICER. The Senator from Montana.
Mr. BURNS. Mr. President, as I have heard my friend from Florida and
the Senator from California make their arguments on this balanced
budget amendment, if there is ever an argument that they have made that
has been powerful it is this one, but it is an argument why we should
have a balanced budget amendment so these trust funds can stay viable,
so we can live up to our obligations. It was a wonderful argument for
them. And I do not think we should lose the spirit of just exactly why
we have to have it.
If we go far back in our history to the ratifying of our Constitution
and read the argument that was made then, when we formed this country,
there was a very deep concern from the Framers of this Constitution
about our ability to create national debt. I think it was Thomas
Jefferson himself who made the statement that still was one of his
concerns when the Constitution was ratified. I know it was a concern of
the first President of this United States, George Washington.
If we read our history, those concerns have lasted as long as our
Constitution has lasted. So the argument they make is a very persuasive
one for, and a good reason why we need, a balanced budget amendment at
this time.
I yield the floor.
Mr. HATCH. Mr. President, opponents of House Joint Resolution 1, the
balanced budget amendment, are expected to support an amendment
unsuccessfully offered in the Judiciary Committee by Senator Dianne
Feinstein to specifically exclude Social Security from the calculations
used to determine if the Federal Government's budget is in balance. A
slightly modified version of this amendment has been introduced on the
floor by Senator Harry Reid.
The consequence of its passage would be cataclysmic for millions of
middle-class Americans who are counting on Social Security to
supplement their retirement income in the future. At best, the Reid
amendment is a jobs program for constitutional lawyers who would keep
the matter tied up in the courts for years, if not decades.
The Reid amendment is just the sort of protection today's senior and
tomorrow's retirees don't need. By requiring the Government to ignore
Social Security receipts and expenditures in balancing its books, the
Reid amendment would threaten the future of a program on which tens of
millions of Americans rely.

how social security works

Consider how the Government collects payroll or Federal Insurance
Contribution Act [FICA] taxes and pays Social Security benefits. Social
Security payroll taxes--like Federal income, corporate, and excise
taxes--are collected by the U.S. Treasury. Unlike other Treasury
receipts, however, FICA revenues are used to back monthly Social
Security checks. The House Ways and Means Committee's Overview of
Entitlement Programs [the ``Green Book''] describes the transaction
this way:

The trust funds are given IOUs when [FICA] taxes are
received by the Treasury, and those IOUs are taken back when
the Treasury makes expenditures on the program's behalf. This
handling of [Social Security] finances goes back to the
inception of the program and has not been altered by the
inclusion or exclusion of the [Social Security] trust funds
in or from the federal budget. [1994 Overview of Entitlement
Programs, p. 91]

Throughout most of the program's history, the Treasury has collected
more in FICA taxes than it has needed to pay Social Security benefits.
The trust funds are thus stockpiling IOU's from the Treasury and are
expected to do so for nearly two more decades. This year, for example,
the Congressional Budget Office [CBO] estimates that Social Security
receipts will exceed outlays by $69 billion. Over the 5-year period
from 1996-2000, CBO projects that Social Security will take in $421
billion more than it will spend.
The Reid amendment would require Congress, when it hammers out annual
Government budgets, to pretend that these billions of dollars simply do
not exist. The Treasury would continue to collect hefty payroll taxes
from working Americans, but these revenues could not be counted when
determining whether the Federal budget was in balance.

what the reid amendment would do

The Reid amendment, as it was offered in--and tabled by--the
Judiciary Committee, would add a new sentence at the end of section 7
of House Joint Resolution 1, the balanced budget amendment. The Nevada
Senator's amendment reads:

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 disability benefits shall not be
counted as receipts or outlays for purposes of this article.

In order to bring revenues into line with expenditures under the
bizarre accounting system necessitated by this amendment, Congress
would have to
[[Page S2366]] choose from at least four major options, each of which
would hurt the economy and imperil the Social Security system.

reid option 1: run government surpluses

The first option would be for the Federal Government to run annual
surpluses--collecting more in taxes than it spends--equal to the value
of Government securities purchased by the trust funds.
This year, for example, the Social Security trust funds will buy $69
billion in Government securities from the Treasury. If a balanced
budget amendment with the Reid provision were in effect, the Treasury
would have to make believe that it never received this $69 billion.
Thus, Congress would have to raise taxes or cut spending by $69 billion
just to keep the deficit at its current level--$176 billion, according
to CBO's most recent estimate. In order to balance the fiscal year 1995
budget under the Reid amendment, the Government would have to eliminate
the $176 billion deficit and then come up with an additional $69
billion.
The Reid amendment thus would make it harder to achieve a balanced
Federal budget, unless Congress resorted to one of the other options
described in this paper. Ironically, many advocates of the Reid
amendment oppose the balanced budget amendment because they believe
that it would require tough decisions on cutting Federal
spending. The balanced budget amendment with the Reid provision could
actually make these decisions tougher than would an amendment without
that provision.

reid option 2: expand the definition of ``social security''

While Congress is unaccustomed to passing balanced budgets, much less
running surpluses, the Reid amendment would present lawmakers with
another option, one with which it is more familiar--spending taxpayers'
money.
The Reid amendment would effectively create two Federal budgets: One
bound by rules of sound fiscal discipline and another in which Congress
could spend as it pleased. The former budget would include all non-
Social Security programs; the latter, all programs defined as ``Social
Security.''
It wouldn't take long before Congress started to redefine its
favorite programs as ``Social Security.'' For example, the Supplemental
Security Income Program [SSI], a welfare program for indigent aged,
blind, and disabled people, is administered by the Social Security
Administration, though it is financed by general revenues rather than
through the payroll tax.
Spending on SSI has grown rapidly in recent years, and the program
has been plagued by scandal. There has been a sizable increase in the
number of alcoholics and drug addicts who qualify for benefits on the
basis of their addiction. Critics also say that the steep rise in the
number of children on the SSI rolls is due in large part to the
mischaracterization of behavioral problems as disabilities. And many
legal aliens have begun to collect monthly SSI checks when their
sponsors--usually family members--withdraw financial support.
A balanced budget amendment would force Congress to take a hard look
at the SSI Program and institute reforms to control costs. But if the
Reid provision were added to the amendment, Congress could take the
easy way out by using the FICA tax to pay SSI benefits. Other welfare
programs--like Medicaid, food stamps, and scores of others--also could
escape reform by being reclassified as ``Social Security.'' This would
drain resources intended for seniors and impair Government's ability to
pay retiree benefits.

reid option 3: create a social security deficit

The Reid amendment would require only part of the budget to be in
balance--non-Social Security spending would have to equal non-Social
Security revenues. But the Reid amendment would permit part of the
budget to be wildly out of balance--the part that seniors rely on for
their monthly Social Security checks.
Because Congress would be prohibited from counting revenues from FICA
taxes as Government receipts in determining whether the budget is
balanced, lawmakers could drastically reduce these taxes without
increasing the deficit. Increases in income taxes, however, would
reduce the deficit. Thus, even if revenues from Federal income taxes
were
increased by the same amount that revenues from FICA taxes were
decreased, the deficit actually would be reduced under the Reid
amendment's twilight zone accounting.

The Reid amendment thus would create a perverse incentive for
Congress to create huge Social Security deficits in order to balance
the Federal budget. Replacing FICA revenues with other Federal tax
revenues would be an easy means of helping to balance the non-Social
Security portion of the budget, which is all the amendment would
require.
Of course, the FICA taxes would no longer fully fund Social Security
benefits, threatening the program with bankruptcy. The Social Security
trustees could borrow money from the public in order to cover monthly
checks to retirees, a step unprecedented in the program's history. But
these Social Security deficits wouldn't matter under the Reid
amendment. In the twisted logic of the amendment, the Federal budget
would be considered balanced as a matter of constitutional law, even as
the Federal Government plunged deeper into debt, a debt that would fall
on future generations.

reid option 4: gamble with social security funds

Congress could avoid these problems by changing the way that proceeds
from the FICA tax are spent. Current law permits these funds to be used
only to pay benefits and to purchase government securities. It also
accounts for these intergovernmental transactions in a commonsense way:
The Treasury is credited with the revenues not needed to pay benefits,
and the trust funds receive an equal amount in Government securities.
Since the Government is borrowing money from itself, this transaction
has no net effect on the deficit.
The Reid amendment would change the way these transactions are
accounted for. While the trust funds would continue to count their
Government securities as assets, the Treasury would have to pretend
that it received nothing of value in return. Thus, in the bizarre world
created by the Reid amendment, every time the Treasury issued a
Government security to the trust fund, the deficit would increase, just
as the Government's debt increases when it sells bonds to the general
public.
Since the Reid amendment would treat these intergovernmental
transactions as it would public bond issues, Congress might stop using
Social Security surpluses to buy Government securities, and let the
Social Security trustees try their hand in the private market. They
could start gambling with trust fund reserves by acquiring industries,
buying up real estate, taking a chance on cattle futures, or
speculating on foreign currencies.

how to save social security

Far from saving Social Security, the Reid amendment would threaten
the program, driving Congress to pursue policies that would bleed the
system and damage the economy in the process.
It also would tie the hands of lawmakers who want to restore the
Federal Government to fiscal soundness. Congressional Budget Office
Director Robert Reischauer, during his January 26 appearance before the
Senate Finance Committee, was asked by Senator Don Nickles whether he
thought a balanced budget amendment should include exceptions for
Social Security or other Federal programs. Dr. Reischauer replied:

I would say the most comprehensive treatment of the budget
would be the most desirable. And what you want is a situation
where all activities of the Federal Government are on the
table to increase or decrease all of the time in the future.
We do not know how this country is going to evolve. * * * In
1920, there was no such thing as Social Security. Now there
is. Who knows what the world will look like in 2020?
If you are going to lock something into the Constitution,
you want to do what our founding fathers did, which was
provide guidance, general guidance, not nitty gritty
specificity, so that the amendment will have enduring value.

The best way to assure that the Social Security system will have
enduring value is for Government to get its own financial house in
order. Rising Federal debt, and the interest payments it entails,
threaten Social Security and stunt economic growth. Robert Myers,
Social Security's former
[[Page S2367]] chief actuary and deputy commissioner, has stated:

If we continue to run federal deficits year after year, and
if interest payments continue to rise at an alarming rate, we
will face two dangerous possibilities. Either we will raid
the trust funds to pay for our current profligacy, or we will
print money, dishonestly inflating our way out of
indebtedness. Both cases would devastate the real value of
the Social Security trust funds.

A government crippled by debt can't keep its promises. The balanced
budget amendment--without the Reid provision--will help Congress make
good on its pledge to seniors and to millions of working Americans to
preserve Social Security.
Mr. President, I referred yesterday to a thoughtful article on this
subject by Mr. David Keating, published in the Washington Times. I
would ask that this be included in the Record following my remarks.
There being no objection, the article was ordered to be printed in
the Record, as follows:

[From the Washington Times, Feb. 8, 1995]

Social Security and the Balanced Budget

(By David Keating)

During the Vietnam war, an American officer was quoted
saying we had to destroy the village in order to save it. Now
the U.S. Senate may apply similar logic when it votes on a
proposal to add a huge loophole to the Balanced Budget
Amendment, supposedly to save Social Security.
Although the Social Security system currently collects more
in taxes than it spends in benefits, this will change early
in the next century. If Social Security is exempt, the
balanced-budget rule would quickly become worthless. Consider
this: In the year 2050, this exemption would legalize an
annual total budget deficit of over $2 trillion. That $2
trillion annual deficit will occur under current Social
Security policies as today's children retire. This loophole
would give Congress yet another excuse to stall any action to
address these huge Social Security deficits.
The balanced-budget amendment simply requires that Congress
take a three-fifths vote in order to pass a bill to borrow
more money. Excluding Social Security sounds nice. but it
would actually create a huge flaw in the amendment. As
Congress chafes under the balanced-budget rule, it would
likely use the Social Security loophole to fund other
programs, leading in turn to the destruction of Social
Security as it works today.
Congress would probably first add other programs that aid
the elderly into Social Security. Obviously candidates
include veterans' benefits and pensions, which total more
than $20 billion a year. Supplemental Security Income, which
is used to aid the elderly poor and costs over $25 billion a
year, is another likely candidate. Then there is the
approximately $175 billion in Medicare and Medicaid spending
that benefits the aged. A portion of funds spent on the
retired poor by Food Stamps, low-income home energy
assistance, housing subsidy and other social service programs
might be transferred to newly exempt Social Security trust
funds. Some or all of federal employee or military retirement
programs may also become part of Social Security.
A future Congress that wished to bypass the balanced-budget
amendment could also, by a simple majority vote, authorize
deficits as large as current Social Security spending. How?
By reducing Social Security trust-fund taxes and revenues and
increasing ``operating'' fund taxes and revenues by an equal
amount. This has the potential to be as much as a $330
billion loophole, the current cost of the Social Security
program.
It also increases the danger of granting further
``exemptions'' to the provisions of a balanced budget
amendment. If Social Security is declared exempt, advocates
of other causes--from highway builders to teachers--would
demand their own exemptions. Or, Congress could simply begin
funding everyday programs under the guise of ``Social
Security.'' Sound implausible? Who ever thought the
Disability Insurance part of the Social Security System would
pay benefits, as it does now, to young drug addicts and
alcoholics who then use the money to sustain their habits?
There is nothing in the proposed exemption that would
prohibit spending money from the Social Security trust funds
for non-retirement programs. A future Congress and president
that wished to circumvent the balanced-budget rule could do
so simply by funding non-Social Security programs from trust
fund accounts. A simple majority of Congress could thus
effectively get around the balanced budget amendment and its
limit on new debt.
In 1974, the federal debt was $483.9 billion. Today it's
over $4.8 trillion, thanks to federal spending growth of
twice the rate of inflation. Fifty-two cents of every
personal federal income tax dollar now goes to pay interest
on the national debt. Not only will interest begin to crowd
out Social Security, but the continued buildup of debt will
impair the ability of future taxpayers to refund moneys
borrowed from the trust fund. Only an all-inclusive Balanced-
Budget Amendment will force Congress to balance the budget
and create a sound environment for the future of Social
Security.

The PRESIDING OFFICER. The Senator from Maryland.
Ms. MIKULSKI. Mr. President, I rise today in support of the Reid-
Feinstein amendment to exempt Social Security in any balanced budget
amendment to the Constitution of the United States. I want to be
absolutely clear. I will not vote for a balanced budget amendment to
the Constitution that does not exempt Social Security. I will defend
that principle in the Constitution. I will defend it on the Senate
floor. And I will make sure to do all I can to exempt it in the
balanced budget amendment.
Social Security is our primary contract with America. Social Security
is a sacred and legal trust between the people and the U.S. Government.
It is a social contract that was established more than 60 years ago and
I believe promises made should be promises kept. We said to the
American people if you practice self-help, if you contribute to a
Social Security trust fund, we will make available to you a safety net
and a floor on which you can build your retirement.
I believe this is a promise that needs to be kept. It was made in the
New Deal. It was made in the Fair Deal. It was made in the New
Frontier. It was made in the Great Society. It was reaffirmed by Ronald
Reagan and George Bush and we should reaffirm it here. Social Security
should be a sacred trust among the American people and should not be
subjected to the vagaries of the U.S. Congress.
Republican colleagues say, ``Do not worry. We all like Social
Security. It is probably the one thing the Democrats did that we really
do like. We do not want to touch Social Security and we can balance the
budget without it.''
That is like hearing somebody say, ``Do not worry, Honey, I will take
care of you.'' But then we all know that does not happen.
If in fact my colleagues on the other side of the aisle believe that
Social Security should not be touched, let us not wait, then, for some
mysterious enabling legislation. Let us put it in writing now and then
let us put it in the constitutional amendment.
We talk a lot about the Contract With America and there is much about
it that I support: the Congressional Accountability Act, the unfunded
mandate legislation, the fact that we need to reform welfare to make
sure we reward work, support families, and move people to self-
sufficiency.
I also want to go back to the original contract, which is the Social
Security contract. We need to honor work. We need to honor sweat
equity. We need to continue to give help to those who practice self-
help, those people who put money into the Social Security trust fund,
believing it would be there for them and not be subject to whatever the
Congress wants to do on any given year with the budget.
My contract with the American people and the people of the State of
Maryland is I will not vote to cut Social Security and I will not vote
for a balanced budget amendment that does not exempt Social Security. I
will not vote to balance the budget on the backs of the generation that
saved Western civilization.
Right now we have wonderful, ordinary men and women who did
extraordinary things during World War II who are now in their seventies
and eighties, who absolutely rely on Social Security. Eleanor Roosevelt
called that generation who mobilized for the war, for World War II, she
called them to something, and said it was no ordinary time and no
ordinary solutions would be sufficient to defeat those enemies of
America and Western civilization.
Not only was it no ordinary time, they were no ordinary generation.
Now we cannot make them pay for the red ink that has been run up in the
Federal deficit.
Social Security is not the cause of the Federal deficit. It is an
independent, self-financed and a dedicated fund. In the early 1980's we
all took tough medicine in order to make the Social Security trust fund
solvent. Today the Social Security has a reserve, it has a surplus
because we anticipate the needs of an aging generation. Older Americans
who survive on Social Security plus a small pension are not responsible
for this Federal budget deficit and should not pay the price for the
balanced budget amendment.
[[Page S2368]] This is not just a senior citizen issue. This is a
family issue. Right now there are many families in my age group who are
called the sandwich generation. They are helping support their mother
and father--or in many instances their family is self-sufficient
because of Social Security combined with a private pension plan--but
this sandwich generation is helping mom and dad and paying for the kids
in college. They deserve the fact that their mother and father should
get the Social Security check that they planned for and that they
thought would be there for them.
I will not let those families down. I am on their side, standing up
for the principles of family responsibility, self-help and believing
when your U.S. Government makes a contract with you it will not change
the rules of the game in the midst of debates on the budget.
Let us be clear. Social Security is not welfare. It is not a line
item in the appropriations process. It is not something we decide on
every year. It is an independent self-financed solvent trust--underline
the word ``trust''--fund. It is the foundation of retirement security
and family security.
If we do not exempt it from the balanced budget amendment I predict
it will be cut. I predict it will be cut severely. This will mean that
millions of families could see their incomes sink, and older Americans
and disabled Americans will be placed at risk.
We hear a lot about angry taxpayers, but they are not angry at Social
Security. Americans know that Social Security works, and 79 percent of
the American people want to see Social Security exempted from the
balanced budget amendment. I stand with those Americans. Count me as
part of the 79 percent.
Count me as being 100 percent with that percentage of the American
people who want Social Security exempted in the balanced budget
amendment. Let us protect and preserve and defend that social contract
with them and let us protect, preserve, and defend the Constitution of
the United States of America.
Mr. President, I yield the floor.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER (Mr. DeWine). The Senator from Utah.
Mr. HATCH. Mr. President, I think this has been a reasonable debate.
It has been civil. The debate has been so for both sides of this issue,
and both sides have been well-represented. Naturally I feel our side is
correct. I would not be here if I did not, working day in and day out.
But the American people voted for change. They thought they were going
to get it when they voted for President Clinton. And to a degree they
have gotten change, but not the change they thought they were going to
get. They thought he would lead the fight for a balanced budget. In a
sense, with increasing taxes and doing some budgetary cuts in the last
year, I guess you could give him some credit for that, except that
under that budget that he passed with 100 percent Democrats and no
Republicans, the Vice President having to break the tie, that budget
has deficits shooting up in 1996 to as high as $400 billion-plus
shortly after the turn of the century.
This year the President has brought his budget forward, and I really
believe he has just thrown in the sponge because this year's budget has
$200 billion deficits ad infinitum just on and on well into the next
century, certainly for the next 12 years. And those are based on his
rosiest assumptions. He just plain did not do anything about persistent
yearly deficits. That is not change. That is business as usual. And
$200 billion deficits are very, very high.
The American people voted for change, and the balanced budget is part
of that change. I think we have to overcome this deficit problem.
This chart here shows the President's projections. Calculating the
deficit under President Clinton, we started with a $4.8 trillion
national debt, and between 1994 and the year 2000, 5 years, he will
spend $1.39 trillion more than we are currently spending.
The deficits will be $103.2 billion for 1994; $129.5 billion in 1995.
Then they go up from there. But they average well over $190 billion a
year. This chart only shows projections to the year 2000. They have
projected up to the year 2007. Every one of those years has $190
billion-plus deficits. That is assuming that the optimistic economic
assumptions of the President will be valid, even though we may have
some downturns and upturns and everything else during that time. I do
not think that these optimistic assumptions will hold, especially if
you do not have a balanced budget amendment to get the Government to
live within its means.
The American people want change. They are not going to be satisfied
with business as usual. What I hear from the opponents, sincere as they
may be, is that we are going to have business as usual. They know full
well the American people support a balanced budget amendment--and the
other body passed this amendment overwhelmingly. It was kind of a
miracle really because we have been fighting for the balanced budget
amendment ever since I came here. We passed the balanced budget
amendment in 1982 by the requisite 67 votes plus 2. We had 69 votes. It
went to the House, and we got 60 percent of the House to vote for it
but it was not the two-thirds. Tip O'Neill beat us over there. Then we
were beaten again over there. But this year, in a vote of 300 to 132, I
believe, they overwhelmingly passed the balanced budget amendment.
So for the first time in history, the Senate, which has a history of
previously having passed the balanced budget amendment, has a chance to
pass it on to the States and make this a very pivotal year in U.S.
history by putting the discipline in the Constitution that will help us
to get spending under control.
I think the people out there know full well that since the other body
passed this amendment overwhelmingly with strong bipartisan support
despite the President's opposition--I have to say that I do not think
the President is opposing this very strongly. Sure, he does not want it
to pass. His budget makes that clear. But I think deep down he probably
wishes it would pass because then it would provide the fiscal
discipline that his party and our party need in order to get spending
under control.
I would like to take a few minutes to define some of the reasons the
American people need a balanced budget amendment. The Tax Foundation,
in its April 1994 special report, calculated that an American worker
worked 125 days last year just to pay taxes. That means from January 1
to May 5, working Americans earned absolutely nothing for themselves.
Every dime they earned--working Americans between January 1 and May 5--
went to taxes for the Federal Government. Put another way, in an 8-hour
day, a working American spends the first 2 hours and 45 minutes working
for the Government. That is wrong. The hard-working Americans who grant
us the privilege of serving them deserve better than this. The American
people have earned this amendment. It would be a shame for us, after
the House bit the bullet and passed this amendment and after they have
taken the lead, to deprive our citizens any longer.
By the way, it was a bipartisan vote in the House, as it has to be in
either body. It was not a Republican victory. This is not a Republican
amendment. This is a bipartisan, consensus amendment. I know. I have
worked on it and have helped write it now for all of these last 19
years, and certainly since 1982. And we have worked with our Democratic
counterparts year in and year out, and 72 terrific, courageous
Democrats voted for this over in the House of Representatives. It would
not have passed without them. We all know that. So there is no reason
for either side to claim victory here, if this passes, as I think it
will. There is every reason for us to continue to work together.
Hard-working Americans who grant us the privilege of serving them
deserve a better break than they are getting. The American people have
earned this amendment. It would be a shame for us to deprive them of
this.
Those of my colleagues who believe Americans are getting their
money's worth for their tax dollars should oppose the balanced budget
amendment. But if any of them believe that, I would be surprised. Those
Senators who believe otherwise should support it.
Mr. President, the size of our bureaucracy is out of control, and
wasteful spending continues. We are actually paying Federal bureaucrats
to frustrate private initiative. Let me get into that in a minute. But
before I do, let me go back to our balanced budget
[[Page S2369]] debt tracker and the growth of the national debate as
we debate.
Mr. President, when we started the debate on day one, the national
debt was $4.8 trillion, and is represented by this red line. We are now
in the 11th day. We are now up to $9,123,840,000 in increased debt just
in the 11 days since we started this debate.
It is going up every day that we debate. We are standing here seeing
the sinking of the Titanic, and just whittling--I guess fiddling would
be a better word--while Washington is sinking American taxpayers deeper
day in and day out. Just look at how the debt grows. That is going to
go up every day this debate continues. It is time for us to do
something about it. The bureaucracy is out of control. Wasteful
spending continues. We are actually paying Federal bureaucrats to
frustrate private initiative.
Let me mention some of the details of our current plight.
I am grateful for the National Taxpayers Union for compiling some of
these points. No. 1, the fiscal year Federal budget deficit was $203.4
billion. No. 2, the Federal Government has run deficits in 33 of the
last 34 years and has run a deficit every single year for the past 25
years. No. 4, last year, gross interest payments alone on the national
debt were just under $300 billion. These gross interest payments were
the second largest item in the Federal budget, and they were more than
the total revenues of the Federal Government in 1975. In other words,
what we are paying for interest, which just goes down the drain,
totaled nearly $300 billion, and that figure is more than the total
Federal budget was in 1975, just 20 years ago.
It took our Nation 205 years, from 1776 to 1981, to reach $1 trillion
in national debt. It took only 11 years to reach $4 trillion. On the
last day of 1994, the total Federal debt had reached $4.8 trillion.
That means that I was a little wrong here when I started my chart
behind me as having a $4.8 trillion national debt the day we began the
debate. That was the debt January 1. So we were actually higher than
that when we began the debate. But, having used that as a rounded
baseline figure, we are now another $9 billion, going on $10 billion,
in debt just in the 11 days this debate has been going on.
The country is suffering. I have to say that despite claims of
drastic deficit reduction with the 1993 passage of one of the largest
tax increases in American history, the Congressional Budget Office
predicted deficits will exceed $300 billion in less than 10 years from
now.
Mr. President, I understand the distinguished Senator from Wisconsin
wants to speak. If I could take maybe a couple of more minutes, I will
be glad to yield.
Even the President's budget, as I mentioned, just sent to Congress,
as optimistic as it is, predicts about $200 billion in deficits every
year through the year 2002 when our amendment will go into effect. This
is another $1.4 trillion in debt over those 7 years. That is almost
certainly a vast understatement. Think of the increase in yearly
interest payments that will add to the Federal budget every year just
from that.
The Washington Post headline on Saturday said a great deal about the
President's budget proposal: ``New Budget to Continue U.S. Deficits;
Clinton Proposal Due Monday Produced Amid Staff Doubts.'' The article
reports that the President's budget ``left some administration
officials doubting the President's commitment to his campaign vow to
halve the deficit by 1996.'' The headline over the continuation of the
Post story on page 4 aptly reads: ``Clinton's Proposed Budget Continues
Deficits He Pledged to Cut.''
Some who are cynical believe he has done that so that the Republican
Congress will have to make the cuts, and then they can criticize the
Republican Congress for having done so. I hope that is not the case.
Nevertheless, it is apparent that he has not been doing what he
promised to try to do. Is there any doubt that we cannot keep spending
this way and racking up these huge deficits? Is there any doubt that
the politics as usual, represented by the President and his budget
proposals, do not serve the best interest of our hardworking taxpayers?
Federal spending and debt crowds out free enterprise. When the Federal
Government spends and borrows, it soaks up resources that private
business might otherwise use to build or expand factories, showrooms,
and stores, and the ability to employ many Americans at better wages.
Deficit financing is hurting the chances that our children and
grandchildren will have financial security. Each one of them owes
$18,500 in national debt as of right now--in fact, each American
citizen, man, woman and child. Each year we are going to add, under the
President's budget, $200 billion to the national debt, from here on in,
ad infinitum. Each year we do that, we cost the average child just over
$5,000 in extra taxes over his or her working lifetime, just to pay
interest costs.
The President is proposing to do just that, year after year. I know
it is tough to be President and I know it is tough to make these
decisions. But future generations are going to face higher interest
rates, less affordable homes, fewer consumer conveniences, fewer jobs,
lower wages, and a loss of economic sovereignty, unless our fiscal
house is brought into order. So it is time we face these facts, Mr.
President. It is time to make the commitment to balance the Federal
budget, and we need this constitutional mandate.
So I urge my colleagues in the Senate to please consider this and
please support us in fighting for and voting for the balanced budget
amendment.
I have more to say, but I will say it at another time, because the
distinguished Senator from Wisconsin desires to speak.
I yield the floor.
Mr. FEINGOLD. Mr. President, we are doing something very unusual
here. We are working on a constitutional amendment. We know that has
not happened many times in our history, and so when you deal with a
constitutional amendment, you have to take an even tougher attitude
about what you are doing. I think you have to consider that two
different things can happen, obviously. One is that the amendment may
be defeated which, in this case, I happen to prefer. As we go through
the amendments, we also have to be responsible about the amendments we
put on, because whether I like it or not, this may become the law of
the land, part of the Constitution.
So the amendments that are offered become particularly important.
What we are doing here is to decide whether or not this balanced budget
amendment should become the law of the land and possibly a straitjacket
and a problem for a Federal Government from which it will be very
difficult to extricate ourselves. So it is in that spirit that I
address the amendment of the Senator from Nevada.
I want to take this opportunity to commend the Senator from Nevada
for his eloquent leadership on this issue of the Social Security aspect
of the balanced budget amendment--his leadership last session and his
leadership now. I also commend the senior Senator from California, who
took the lead in the Judiciary Committee on which I serve in trying to
provide at least this exemption for Social Security from the balanced
budget amendment.
The Senator from California did such a good job, and I was happy to
be able to help her. We had a very close vote; we were only one vote
off in the Judiciary Committee from defeating a motion to table the
amendment.
I see this amendment both in the committee and here on the floor as
not only serious, but as a sincere and constructive amendment, even
though I have reservations about the balanced budget amendment itself.
I especially speak at this time because even though I think there is a
chance the balanced budget amendment will not pass this body, and even
though I think there is a possibility that even if it goes through the
Congress it will not be approved by the States, the fact is that it may
well do that.
We may well be faced with the possibility that the U.S. Constitution
will have a balanced budget amendment that provides no protection for
the Social Security program. Listening to the debate in committee and
in listening to the debate yesterday on the floor, I realized again
that when you look at the Social Security amendment, it really depends
on how you look at the Social Security fund itself. How one
[[Page S2370]] comes down on this amendment depends on how you look at
the contributions people make to the Social Security system.
One group of people see the Social Security fund as a distinct and
separate fund, based on a contract. They think they paid in the money,
that a deal was made, that they are entitled to their Social Security
benefits, and that it is not subject to congressional whim.
There is another group that sees this as just another program, albeit
a worthy program. I know of no Member of the Senate or any Member of
the other body who does not think Social Security is a worthy program.
But this other group just sees it as a program, something that may make
sense, something that is expensive, something that we may have to move
around and take some money from, but something that is worthy
nonetheless. Those are really the two different ways to look at Social
Security. It is because of this distinction--the differences between
the way people look at Social Security--that people come down on
different sides on what the chairman of the Judiciary Committee called
in the committee the loophole.
The chairman, the Senator from Utah, said that putting this amendment
into the balanced budget amendment and into the Constitution would
create a loophole; that the Members of Congress could take basically
anything they wanted and label it Social Security and use it as a way
to get out from under the amendment. That was the chairman's view of
how this would create a loophole.
But I think I look at the Social Security fund a little differently
than the chairman--and I acknowledge that a lot of people support him
in his view. But I look at the Social Security system as a contract.
And so for me, the loophole is not the amendment that the Senator from
Nevada is proposing; the loophole is the past and inappropriate use of
the Social Security fund to mask the deficit and the debt. That has
been the loophole that has been used in the Congress.
We should not suggest even for a minute--and apparently it went a lot
longer than that--that somehow the Social Security fund is part of that
money that comes into the Federal Government and that we can use it in
our budget calculations, as, in fact, it has been used in the past to
mask just how big the deficit really is. I know that the Congress in
recent years has recognized that this is inappropriate, but it was
done--that is the dangerous loophole; that the Social Security fund can
be regarded as a cookie jar, a slush fund, whatever you want to call
it, to solve our problems that we have failed to solve. In my mind,
that is the loophole, not the risk that the Constitution would say do
not touch Social Security.
I think the amendment of the Senator from Nevada and the amendment in
committee of the Senator from California are critical because they
permanently close the loophole as we move in the balanced budget era.
In fact, I would say, based on a few years of listening to folks all
over my State, that the use of the Social Security fund to mask the
deficit and the debt is one of the really strong reasons people
mistrust the Federal Government. They are troubled by their belief that
we are willing to engage in gridlock and avoid solving our Nation's
problems. But, they are also angry that we can be so arrogant as to
consider Social Security system funds not to be part of a contract with
the people who have paid into the system, but money that we can use to
solve problems that we have not been willing to solve in the past.
The amendment of the Senator from Nevada is responsible as to the
future, as well. It is highly responsible, because what it does is
address the future solvency of the Social Security fund.
Just as the Social Security fund is not the reason we have a deficit
today--we know that the fund is solvent--it is still the case that the
Social Security fund faces an extremely likely, if not certain, strain
in the future. It must remain intact as a separate system with a
separate, credible, long-term financing plan so that Social Security
will be there for those of us who come along in the future. Without the
amendment of the Senator from Nevada, the balanced budget amendment
becomes not a friend to the future, but a continuing threat to the
integrity of the Social Security system.
Now, that is not to say--and I think this is important--that there
cannot be changes on the table for Social Security. I think there
should be. Everything needs to be improved over time and, especially
when you are facing future insolvency, we have to consider some
changes.
In fact, maybe we should look at some of the changes proposed by the
so-called Entitlements Commission, the Kerrey-Danforth Commission. They
put some ideas on the table that had to do with Social Security, such
as whether or not we should raise the retirement age, whether or not
there should be some different assumptions made in terms of how the
Consumer Price Index is calculated as it relates to the cost-of-living
increases.
I am willing to consider those changes, but only if those changes are
used to make sure that the money goes into the Social Security fund to
make sure it is solvent for the future. Without the amendment of the
Senator from Nevada, these tough changes, which are going to be
controversial no matter what, will be changes that the American people
may see as ways not to make the fund solvent for the future, but to
take care of pork projects somewhere else out of their State so that
Members of Congress do not have to balance the budget directly. I think
that is a valid fear, not only for seniors, but for all the people who
come after them and who hope that they have not paid into the Social
Security system in vain.
Mr. President, in this context, I am troubled not only by the notion
that somehow we are creating a loophole in the Constitution, but I am
especially troubled by the notion that I have heard expressed in
committee and on the floor--I do not know whether it is a notion or a
reassurance or a wish--which is this: The statement that somehow Social
Security will compete well. It is going to do really well, we are told.
It has a lot of support. There is nothing to worry about. Nobody is
going to hurt Social Security.
That is what the proponents of the balanced budget amendment tell us.
That is what people say when they say we do not need the amendment of
the Senator from Nevada.
But I think that is troubling. I am afraid that the Social Security
system may not fare so well in the brave new world of the balanced
budget amendment or in this new marketplace of budgetary suitors. I
think that the language of the marketplace in saying that Social
Security will compete well is a direct breach of the whole concept of
Social Security and the promise that was made to all those hardworking
Americans who paid into the system over the years, understanding and
believing in their Government that nobody would monkey around with
their retirement money.
Mr. President, we are not talking here about just another kind of tax
revenue. Nobody likes taxes. Nobody likes April 15. But the
understanding is, when you send in that money on April 15, or you have
to send in a little extra amount because your withholding was not quite
right, that it goes into a big pot out here and these Members of
Congress get to decide, along with the President, what is done with it.
People do not like it, but they understand that is our system.
But that is not their understanding when it comes to Social Security.
For 50 years, that is not what the American people have been told
Social Security is all about.
To put it another way, I do not think the American people think they
should be part of, in effect, a large block grant that the Federal
Government has where they have to compete against other programs, and
that they hope they do well in this new block grant after the balanced
budget amendment, and they hope there will be enough money there so
they can get their Social Security benefits. That is not the
understanding.
Mr. President, words of ``competition'' and ``free market'' are
almost always appropriate. That is what our system is based on. The
words of ``free market'' and ``faring well'' and ``competing'' with
other worthy programs are not appropriate when it comes to Social
Security.
[[Page S2371]] The final point I would like to make, because I think
this is often overlooked in attempts to minimize the importance of this
amendment, is that there is an implication that this is just about
senior citizens. Somehow, this is pandering to older Americans who want
their Social Security benefits, as if there was something wrong with
that. There are constant references to the power of the senior lobby,
how we are pandering to older people. This is what we hear all the
time.
But I will say that I agree with the sentiments of the proponents of
the balanced budget amendment who say that nobody is going to mess
around with the seniors today. That is politically explosive. That is
not going to happen. We are not going to take away from the benefits of
senior citizens today. They are not, if you will, the at-risk
population when it comes to the balanced budget amendment.
I would like to identify three generations that are far more at risk
because of this constitutional amendment than the seniors of today.
The first generation is my generation, the baby boomers.
Do not accuse me of pandering to seniors. Accuse me, if you will, of
worrying about my own Social Security benefits. I am concerned. I am
concerned that, if this institution has the right to mess around with
Social Security funds, when my wife and I get up to be that age, there
is not going to be anything there. And there are a lot of us in our
generation. You bet, we have a lot of votes. But we also have a right
to the benefits that we paid for and we were told we were going to get
by participating in this system.
Clearly, my generation is concerned.

There is another generation that I know is concerned and they have
become very vocal. They are called generation X, kids in their late
twenties or early thirties. They actually have articulated a philosophy
for which I do not pretend to be the spokesman. Obviously, I am too
old. I have read the articles and heard the statements and seen them on
TV. What they are saying is, we are not sure that the older folks--and
now I am in that group--who are running the show in Washington care at
all if Social Security is solvent when we get there.
They know there are seniors today. There is a huge group of baby
boomers that will eat up all kinds of benefits when they get there.
They, I think, kind of smell a rat. When they get there, they are very
concerned that this system that they are now paying into in their
younger years, when they would probably like to get a house, buy
another car, they are worried we are spending.
There is a third generation, the age of my kids. People who are 14,
11, 9. People that do not understand this. Yet some are figuring out
that we have an awful big Federal deficit here, and they will realize
shortly as they graduate from high school and go into the work force,
if we do not protect Social Security, they will be the ultimate victims
of our fiscal irresponsibility of recent years.
I conclude, Mr. President, noting that the people that we are always
talking about with regard to the deficit and the balanced budget
amendment are the children and the grandchildren. Would it not be
ironic if, in the name of helping the children and the grandchildren,
we take away forever the possibility that those same people would have
the opportunity to have Social Security? That is ultimately what is
going on here. We are taking away potentially, without this protection,
the same rights and privileges that so many of us hope to enjoy,
because there just will not be any money left in the fund.
Mr. President, this is a sincere amendment. Whether the balanced
budget amendment passes or not, it is absolutely essential that we keep
it separate, that we keep our promise not only to those who have worked
and paid in, but that we keep our promise to those who come after.
I urge my colleagues to regard this as an important amendment. I
strongly urge support for the motion of the Senator from Nevada. I
yield the floor.
Mr. FORD addressed the Chair.
The PRESIDING OFFICER (Mr. Gregg). The Senator from Kentucky.
Mr. FORD. Mr. President, I take the floor to join my colleague from
Wisconsin and my other colleagues in support of their attempt to ease
our seniors' fears and to help set some parameters for the debate on
the balanced budget amendment.
The fact is, the Social Security system is not causing the deficit.
Its revenues and surpluses should not be used to mask the deficit nor
should its outlays be counted as part of expenditures. Because of these
very compelling facts, it is clear to me that Social Security should be
exempted from the balanced budget amendment.
Unfortunately, as has been pointed out by various Senators, there is
a great deal of confusion in the country over what the balanced budget
amendment will mean. The Members on the other side of the aisle have
recently voted down the right-to-know amendment that would have gone a
long way to answer these difficult and important questions that are
confusing the American people. I think this is unfortunate. Throughout
the debate in the House and here in the Senate, Members from the other
side of the aisle have continued to say ``everything is on the table.''
Asked if that included Social Security, most have tried to be
reassuring. Well, when someone tells me that everything is under
consideration and then adds that we'll protect Social Security only
after being prompted, forgive me for not being too heartened by their
words.
I say as my father used to say, put it in writing. Put your money
where your mouth is and continue to keep the Social Security system in
its protected position as a trust fund, separate and distinct from the
rest of the Federal budget.
The many proposals to balance the budget being circulated are scaring
people living on Social Security and scaring those who expect the U.S.
Congress, to abide by our contract, our promise, that the funds will be
there when they need them. The conflicting statements in the press and
the speculation on the political talk shows is feeding the confusion
about what will happen to Social Security. So, Mr. President, I believe
it is high time that Senators go on record stating flatly where we
stand with respect to Social Security.
Oh, no, do not come up with this ``We will take care of it in the
implementing language.'' That does not buy it. Trust, but verify. We
heard that. I trust, but I want to verify it in writing.
I am not afraid to say where I stand. I think those who are
supporting the balanced budget amendment are scared to death over this
one. We have not had to have a caucus on what to do about the vote on
Social Security. We have not had to have a caucus saying we want to
develop a second-degree amendment or a substitute that puts Members in
a position that when we get to the implementing language we cannot
touch Social Security.
I have an answer for that one, I think. Many years ago our Nation
made a pact with its people that their payroll contributions--and we
make them pay--would be available when needed, whether in old age or
because of disability.
When I say ``protect'' I mean protect, without a doubt. Some have
advocated dealing with Social Security issues, as I say, in the
implementing language of the balanced budget amendment. I say to my
colleagues and the Nation that that will not cut it. Legislation can be
changed at the whim of this Congress or the next Congress.
Our amendment is different. By actually writing the protection into
the Constitution it truly protects the Social Security contract. We
have heard a lot about contracts in the last 35 to 40 days. We had
heard a lot of it last year. Now we have a contract we want to break.
``Oh, we are not going to break it. We are going to take care of it
in implementing language.'' Well, how are we going to take care of it?
We can change it any week we want to, any month we want to, any year we
want to, any Congress we want to. So we do not take care of it. We can
change it.
In fact, this amendment reinforces our position, makes it stronger,
makes Social Security safer and more secure. Neither receipts nor
outlays will be counted as part of the budget under this provision.
The facts in this case bear repeating, I think. The Social Security
system is not causing the deficit. Our proposal
[[Page S2372]] protects the sanctity of this most vital program.
I hope and trust that most of our colleagues will join in protecting
Social Security. We need to go on record--not some vague time in the
future--to put our seniors' fears to rest.
If we say we want to safeguard Social Security, remember that actions
speak louder than words. Support the Reid-Feinstein amendment to the
balanced budget amendment. Support this measure. Support for this
measure is the only way to truly guard the trust fund. I hope my
colleagues will support it.
Opponents argue on this issue that statutes never have been
incorporated in the Constitution and this would be an unprecedented
constitutionalizing of a statute.
The response to that is, this is the first time that we have ever
tried to do an amendment to the Constitution fixing fiscal policy. So
if this is the first time we have done that, we can do something else
for the first time.
So if we are talking about fiscal policy, should we not be concerned
about one of the largest fiscal elements of our society; namely, Social
Security?
I know there are a lot of people here just as sincere about
supporting the constitutional amendment as they can be. I support it. I
voted for a constitutional amendment to balance the budget. You are
going to need my vote, but you know, they say, whichever way it goes,
Democrats lose on this. If you pass a balanced budget amendment, the
Republicans win. If they lose, they beat the heck out of us for the
next 2 years politically, and there will be fewer Democrats here 2
years from now than there are now. I see the President smiling. He
would like that. That is all right. I am going to do what I think is
best whether I get to come back or not, and I will defend my position
with anyone on the other side any time you want to have that debate.
But there are some people around this Chamber I respect. I respect
them personally and for their judgment and experience and knowledge.
One of those is the distinguished Senator from Alabama, Senator Heflin.
I do not think anybody in this Chamber disputes his legal and
constitutional knowledge.
So let us just look at this for just a moment, where he is coming
from. Opponents of this amendment argue that we will use implementing
legislation to exempt Social Security from the Balanced Budget Act
calculations. That is what we hear. We hear it every day from my
learned friend from Utah--I heard it, he just keeps repeating it, and I
almost believe it he has repeated it so much. But let us listen to the
distinguished Senator from Alabama. This refutes the ability to do
something about Social Security in the implementing language that we
hear about.
Here is what Senator Heflin says:

Attempts to protect Social Security through implementing
language would be futile.

Futile, and I underscore that.

Once the Constitution is amended to require that total
outlays for any fiscal year shall not exceed total receipts
for that fiscal year, Social Security is in danger.

That is what Senator Heflin says. And he goes further to say:

This means that there will be a constitutional requirement
that Social Security funds be considered on budget, because
the language says all receipts, all revenues.

All receipts, all revenues. So when that balanced budget amendment is
passed, that includes Social Security, and this is by a man I believe
has as good a knowledge of the Constitution as anyone in this Chamber.
He goes on further to say:

If the balanced budget amendment is adopted as presently
worded, it would prohibit--

Let me repeat that.

it would prohibit Congress from legislatively taking Social
Security funds off budget

Because you have included them--

and would nullify the provisions of the 1990 Budget
Enforcement Act which requires Social Security funds to be
considered off budget.

That balanced budget amendment says it is all receipts, all revenues,
and here is a fellow I think you have to respect, a Senator, I better
be careful. Senator Byrd will be up here in a minute if I call him
``fellow.'' He is a Senator. So I want to be sure I say it right.
Here is a Senator we all respect. He thought about this for weeks,
and he would not have made that statement publicly if he did not
believe he was legally and constitutionally correct. When he makes that
statement, after thoughtful consideration, I have to believe it.
We have others from the American Law Division who agree with Senator
Heflin. They put out their statements. Once you put ``all receipts'' in
that amendment to the Constitution, you eliminate the ability under the
legislative implementation of that budget of trying to exclude Social
Security.
If you are willing to take that chance, and if you are willing to
take that chance, go ahead and vote against it. But I will tell the
Senate and the American people, here is one Senator who is not going to
vote to include Social Security. I have too many in my State, and you
have too many in your State and there are too many across this country
who have a contract with us.
``Oh, it's all right, old Ford is down there flapping his lips. It's
not going to make any difference, they already have the votes.'' They
at least start out with 53--maybe 52. You did lose one. One on that
side is all right, up until now.
But when it comes to the point of whether you want to believe the
constitutional scholars that once you pass this balanced budget
amendment Social Security is excluded from the implementation of that
budget by this body, then you have said one thing and you are unable to
do it.
I do not want the courts to start telling me to cut the budget, to
raise the taxes, you cannot do this and you cannot do that. And we are
getting very close to saying to the courts, ``You are going to run this
country.'' I am not ready for the courts to tell me how to vote in the
legislature, in the Congress, and I do not think you want to vote to
give that much power to the courts.
We are on the verge of saying that the courts will be all powerful
over our fiscal policy. Line-item veto--we are going to give that to
the Executive. We can just get us a plastic card and vote from home,
and a lot of people would probably like for us to do that. But we are
slowly but surely saying to our forefathers that you made the best
judgment of any country in the world when you put together the
Constitution, but we are saying now we are going to give a piece of the
legislative prerogative to the courts, we are going to give another
piece of legislative prerogative to the President.
I believe Senator Heflin when he says that if you say ``all
receipts'' and the constitutional amendment passes, you will not be
able to get Social Security and those people out there now drawing
Social Security will be in deep trouble. A $702 billion surplus in 2002
in Social Security. A $780 billion surplus in Social Security in 2002
and you want to take that and reduce the deficit.
Now, if I did not have to pay it, it might be a different deal, but I
have to pay it. I look forward to it because it is a contract. How many
people get out of paying Social Security? I do not know. Unless you do
not make anything, you pay Social Security. It is planned to go up and
have a surplus. That is the plan. We do not even have a means test. I
have not even heard it suggested.
I see a lot of people taking notes while I am talking. Maybe they
want to think about this constitutional question a little bit.
But I just say to my colleagues and to those who may be watching--
once they started listening to me talk, they probably turned on the
local news or something--but you better be careful about allowing the
Social Security amendment to fail because if that balanced budget
amendment passes--and I suspect it will and the States will ratify it--
then Social Security is part of the deficit reduction, regardless of
our implementing language.
Oh, I will hear good legal words. I am not a lawyer. Therefore, I am
not a word merchant, and I cannot take my words and make it sound good.
You have both sides. You have both sides. And it is good to argue that
way.
But the only thing I know is I listen to people I trust, people I
think are intelligent, people I think thought this part of the
amendment through thoroughly and have now made their judgment. That
judgment has been supported by the American Law Division of the
Congressional Research Service. They all concur with Senator Heflin's
statement. If that is true, all of us in
[[Page S2373]] this Chamber better take a step back and look at where
this has taken us, particularly as it relates to Social Security.
Mr. President, I say to my colleagues I hope that the 17,000 calls
per minute being made around this country as it relates to Social
Security begin to burn between now and the time that they have this
vote, and that we can at least save Social Security in our haste to
have a drag race and accomplish things and put it on the 30-second
sound bite.
I yield the floor.
Mr. SIMON addressed the Chair.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. SIMON. Mr. President, I agree with three-fourths of what Senator
Feingold said before and what Senator Ford has said. I believe we do
have a contract with people who have signed up for Social Security. As
a matter of fact, I do not remember when it was, but about 10 years
ago, when I introduced a balanced budget amendment, I had an exemption
for Social Security.
I finally withdrew that for two reasons. First, I believed that we
better protect Social Security by not having it in, and I will explain
that in a few moments. Second, we have a contract with a lot of other
people, too. And if you put in this exemption for those on Social
Security, what about Federal employees? What about veterans? What about
railroad employees? What about other trust funds we have set up where
we have a contract--for aviation, for highways, for other things?
Mr. FORD. Mr. President, will the Senator yield for a question?
Mr. SIMON. I will be pleased to yield.
Mr. FORD. I understand what the Senator is saying about these other
contracts. But in the military, we appropriate funds every year for the
retirement of the military. The airport improvement trust fund, if you
fly an airplane, you pay the tax. If you do not fly, you do not. Then
you are going to see that we can reduce those taxes. Therefore, you
will not have a trust fund. Under the highway trust fund, you have
gasoline taxes. If you reduce those taxes, you do not have a trust
fund. Here it is mandatory that you pay under Social Security, and that
is a trust fund with a contract. Will the Senator agree with that?
Mr. SIMON. I agree they are different. But what about railroad
employees, if I may ask?
Mr. FORD. Railroad employees are under Social Security. They have
been transferred to the Social Security. The railroad retirement system
has been merged with Social Security, and Social Security is the
railroad retirement fund.
Mr. SIMON. I differ with my colleague on that.
Mr. FORD. My father-in-law is a railroad retiree, and he gets his
check from Social Security. Now, Mr. President, I do not know what it
is, what kind of fund he has, but they did not have enough funds to
take care of it and they turned it over to Social Security, and Social
Security is now taking care of those retired railroad people.
Mr. SIMON. The Senator is partially correct in that.
Mr. FORD. At least that is better than being all wrong.
Mr. SIMON. Mr. President, let me just add, we have a contract not
only with people who are on Social Security today. We have a contract
with those three groups that Senator Feingold mentioned in the future.
And how is the Social Security trust fund protected? It is protected by
U.S. bonds.
If you take a look at the history of nations, when nations get around
9, 10, or 11 percent of deficit versus national income, with the
exception when you are in a war, then nations start printing money.
What the economists say is they monetize the debt. The latest CBO
projection is we are going to end up, in the year 2030, with 18
percent. That suggests that the only way we can protect Social Security
is to make sure that debt does not rise, and that we do not monetize
the debt, because if the dollar is only worth 25 cents, those bonds are
only worth 25 cents on the dollar.
Senator Ford is correct. Social Security is not causing the deficit.
I have voted for statutory provisions, and I will again as we move
ahead. But we also have to recognize that if we separate Social
Security and say this is not our direct responsibility, starting in the
year 2012 or 2013, Social Security starts to go into a deficit
situation.
What we ought to be doing, if this passes, is sitting down with
senior groups right now and saying how do we plan for this? Do we have
to have a half-percent increase in Social Security in the FICA tax to
pay for it? Should we, over a period of 12 years, each month increase
the retirement that you need to have?
I do not know what the answers are, but I know that if we just put
this off and say this is not our direct responsibility, we are asking
for trouble.
Here let me just add, we ought to be listening to Bob Myers, for 21
years the chief actuary of the Social Security System. He says it is
absolutely essential for the future of our system that we pass the
balanced budget amendment. I hope we do that.
Let me just add one other point. There are those who philosophically
just are opposed to a balanced budget amendment, period. My friend,
Senator Byrd, is one of those. Senator Feingold is one of those. But
let no one use the defeat--and I think this amendment will be
defeated--let no one use that as political cover and say, well, I
cannot do this because I want to protect Social Security recipients.
The only sure way to protect Social Security recipients is, as Bob
Myers has pointed out, to pass the balanced budget amendment. And that
is what I hope we will do and do in a responsible way.
The Reid amendment, in my opinion, should be defeated. Then we should
do the right thing by those who are on Social Security now and will be
on Social Security in decades to come by adopting the balanced budget
amendment.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from West Virginia.
Mr. BYRD. Mr. President, the distinguished Senator from Illinois has
referred to Mr. Bob Myers on two or three occasions. On another day I
will take the time to read into the Record what Mr. Robert Ball had to
say about Mr. Myers' statement and had to say about Social Security and
had to say about the balanced budget amendment, so that the record will
be balanced.
I thank the Senator.
Mr. President, when former President John F. Kennedy wrote ``Profiles
in Courage,'' I believe he wrote about Edmund G. Ross, of Kansas,
during the debate in 1868 on the impeachment of Andrew Johnson. At the
conclusion of the trial when the vote was taken, the first vote was on
article 11. That was a test vote. The House managers felt that was kind
of a catch-all provision on which the guilty verdict would most likely
be rendered--would have its best chance. But on that vote, 7
Republicans voted with 12 Democrats to acquit President Andrew Johnson.
Thirty-six votes were needed for a guilty verdict, for a conviction; 36
votes. The vote was 35 to 19. And so those who sought to convict
President Johnson failed by one vote, and President Kennedy mentions
the name, I believe, of Edmund G. Ross, of Kansas, who was one of the
Republicans who cast a vote for acquittal and thus, apparently, sealed
his political doom in so doing.
But there was another Senator who cast such a vote and that was Peter
G. Van Winkel, of West Virginia. Peter G. Van Winkel was from
Parkersburg, and he voted to acquit President Johnson. In so doing,
Peter G. Van Winkel closed the escape door and sealed his doom
politically. The West Virginia Senate, in that year of 1868, passed a
resolution condemning--I believe the vote was 18 to 3--condemning
Johnson. So the pressure was on because most of the West Virginians
were Unionists. The pressure was on Peter G. Van Winkel to vote guilty.
Waitman T. Willey, the other West Virginia Senator, voted guilty. But
Peter G. Van Winkel voted not guilty.
Edmund G. Ross went on to switch from the Republican Party to the
Democratic Party in later years. He, I believe, was Democratic
candidate for Governor of his State later. He had a continuing
political career as a Democrat.
But not so with Van Winkel. He was finished. He looked down into the
open political grave and knew that was where he was going to his final
rest.
So there were two profiles in courage.
I was visiting with Senator Pell recently and I saw on his office
wall a
[[Page S2374]] framed article, I believe it is from the New York
Tribune. The headline was as follows.

Pell Will Vote Against Bonus; Means His End.
New York Representative Says Act Will Be Political Suicide
But He Can See No 0ther Course.

And reading from that May 1 story of 1919 or 1920, I forget which it
was, dateline Washington, May 1.

Representative Herbert C. Pell, Jr., Democrat, who was
elected to the House from the Fifth Avenue District, (17th of
New York), announced today in a speech on the floor that he
would vote against the soldier's bonus bill despite his
belief that to follow such a course would be political
suicide.
Explaining his conviction later, Mr. Pell said that
although most of his constituents might mildly approve his
stand he believed several hundred returned soldiers of
Democratic sympathies would cross the party line and assure
his defeat in a district which was normally Republican.
``I intend to vote against the bonus,'' Mr. Pell said in
his speech. ``I am doing this in the full realization that it
means the end of my political career, and I can tell you
frankly that it is a painful thing to commit suicide, but I
do not think that honor will permit me to follow any other
course.''

I will not read the rest of the article. But here was a profile in
courage, Herbert C. Pell, Jr., father of our own illustrious colleague,
Claiborne Pell, who knew that he was closing the door forever to any
future in politics but who stood upon principle. He put principle above
party; principle ahead of expediency, and cast that vote. So I asked
Senator Pell to give me a copy of that newspaper story.
I ask unanimous consent it be printed in the Record at this point.
There being no objection, the article was ordered to be printed in
the Record, as follows:

[From the New York Tribune]

Pell Will Vote Against Bonus; Means His End

New York Representative Says Act Will Be Political Suicide, but He Can
See No Other Course

Tax Methods Assailed

would paralyze industries and create the worst panic in history; is
belief

(From The Tribune's Washington Bureau)

Washington, May 1.--Representative Herbert C. Pell Jr.,
Democrat, who was elected to the House from the ``Fifth
Avenue District'' (17th, of New York), announced to-day in a
speech on the floor that he would vote against the soldiers'
bonus bill despite his belief that to follow such a course
would be political suicide.
Explaining his conviction later, Mr. Pell said that
although most of his constituents might mildly approve his
stand, he believed several hundred returned soldiers of
Democratic sympathies would cross the party line and assure
his defeat in a district which was normally Republican.
``I intend to vote against the bonus,'' Mr. Pell said in
his speech. ``I am doing this in the full realization that it
means the end of my political career, and I can tell you
frankly that it is a painful thing to commit suicide, but I
do not think that honor will permit me to follow any other
course.

thinks industries would be paralyzed

``Of course I shall vote for the most generous treatment
possible for men that have been injured in the service of the
United States, and also for proper care of the dependents of
those men who have been killed, but I cannot bring myself,
merely for consideration of political advantage, to vote for
a bill which would impose a tax of $20 a head on every man,
woman and child in the country. There is no conceivable way,
or at least no way has been suggested, by which such an
amount of money could be raised which would not paralyze the
industries of the United States and precipitate such a crisis
as we have never seen in our history.
``Hard times unquestionably are coming, whatever we may do,
but while we cannot avert difficulties we can tremendously
aggravate them. So far there have been three plans suggested
for raising the money.
``First, by the issue of $2,000,000,000 of bonds which,
obviously could not possibly be marketed at a rate very much
under 8 per cent, which would promptly knock twenty points
off the price of Liberty bonds and make any private borrowing
by business men practically impossible.

tax methods are assailed

``Second, a retroactive tax on incomes for at least three
or four years. Ordinary common sense will show any man that
this money has not been kept by the individuals who acquired
it, in the form of cash in their stockings, but has been
spent or invested, and to raise the tax money every business
man in the country would be obliged to go into the money
market and borrow on his own credit. This also would run the
price of money up to such an extent that the permanent
investment rate in the United States would remain somewhere
around 8 per cent for a great many years. Of course, I mean
non-speculative investments--the class of thing that before
the war paid from 3\1/2\ to 4\1/2\ per cent.
``The third plan is a general sales tax of one-half of 1
per cent on all sales made in the country. The argument for
this is that it would take the money from the people in such
small installments that they would not notice it, but it
would be impossible to take such an enormous sum from the
community without very seriously affecting all business
throughout the country, and, of course, it would wreck the
financial district of New York, and with it the hope of
commercial preeminence of the world.

money would drift to london

``An American stock exchange would probably be opened in
London, on which all stocks listed on New York would be dealt
in. This would mean that London would become the great market
of the world for call money, and would end any hope that we
may have held in the past of New York becoming the financial
capital of the world.
``Considering the low purchasing power of money to-day and
also the general tendency of all classes toward extravagance,
$500 means about as much to a man to-day as $75 or $100 used
to mean to us, and we may rest assured that nine-tenths of
the men receiving this money will spend it on a good time and
not work until it is all gone. After that they will try to
get back the jobs they held and find that they no longer
exist, so that their last state will be worse than the
first.''
Representative Johnson, of South Dakota, insisting that the
bonus bill ``must pass,'' proposed in the House to-day the
elimination of the tax on sales, which was criticized
severely by Republican members in conference last night, and
the substitution of a tax on war profits.
Chairman Fordney of the House Ways and Means Committee,
announced that sessions of the committee would be held late
next week, at which the elimination of the sales tax
provision would be considered.

Mr. BYRD. Mr. President, earlier we witnessed here in the Senate one
of those vital moments of historic drama for which the U.S. Senate was
created, that moment during which our friend and colleague, Senator
Mark Hatfield from Oregon rose and announced his opposition to the
proposed balanced budget amendment to the Constitution. When he did
that he wrote on this very day his own profile in courage.
Senator Hatfield and I are both standing in this debate on principles
that transcend both party allegiances and personal quirks. Our position
is against vilifying the sacred document on which this Republic is
based with parochial conceits and economic policies that will surely be
viewed in the future as an anachronism--if this amendment is ever
adopted in the country.
Our position on this matter reflects a conservative stance on the
Constitution, based on the ``strict constructionism.''
Where are all these conservatives we hear about? Like Disraeli, I am
a conservative: To retain all that is good in the Constitution. And the
radicals remove all that is bad. This position of strict construction
is rooted in American history and in constitutional traditions.
But one thing highlights Senator Hatfield's position and
differentiates that position from my own position. Senator Hatfield is
swimming against the inclinations of the majority of his caucus. It may
very well turn out to be almost a unanimous caucus except for his vote.
Senator Hatfield is swimming against the inclinations of the majority
of his caucus and against the directives of the so-called Contract With
America, of which the House Members of Senator Hatfield's own party are
so enamored.
Senator Hatfield's stand on the issue of the balanced budget
amendment is a stand which should make every Senator proud, even those
who differ with Senator Hatfield and with me on this issue. Senator
Hatfield's position on this matter suggests those instances --and I
have referred to a few earlier--those instances of character and
distinction cited in ``Profiles in Courage,'' one of those defining
moments for which the Founding Fathers created the Senate as ``the
place to send legislation so that it might cool down.''
Mr. President, I again commend my friend and colleague Senator
Hatfield for his courage and his demonstrated leadership on this issue,
and in this body. He has stood on the unfailing foundation of
principle.
He has lived up to his oath to support and to defend the Constitution
of the United States against all enemies, foreign and domestic. He has
put his vote behind reserving that grand document --and here it is, the
Constitution of the
[[Page S2375]] United States--for future generations. He has stood
against the political winds of expediency, and the people of Oregon
should be proud of him, and the American people should be proud of him.
Regardless of their viewpoint on this particular issue, they should be
proud of him.
Mr. President, it seems that we live in an age of little reverence
and less patience. It is an era of fast food and slick advertising
slogans, of instant analysis and rapid information. In politics, it is
a time of sound bites and media men.
The practical application of democracy as it has evolved, with its
condensed messages and its blow-dried candidates, stands in stark
contrast to the carefully crafted, intricate, thoughtful system
envisioned by the Framers and given form by the written document known
as the Constitution of the United States of America.
Representative democracy is a slow, complex, and cumbersome way of
governing. Its strong point is not speed, and not efficiency but
stability. In a world enamored of instant gratification, 30-second
political ads, 30-minute press conferences, rapid transit, fax
machines, satellite communications, and a whole host of lifestyle
subtleties that peddle speed and simplicity as invaluable commodities,
I sometimes wonder if, as a people, we have somewhere lost the patience
for representative democracy.
It is as if the perseverance to examine issues with meticulous care,
considering and publicly debating all aspects until a solid consensus
emerges, has gone out of style. Perhaps our ability to concentrate--the
American attention span, if you will--has been shortened, rather like a
child who has watched too much bad television. And there is all too
much of that to watch.
Given our national fascination with time-saving devices that simplify
our lives, it becomes easy to understand why intractable problems,
without quick or obvious solutions, are especially frustrating to the
American people. In many American families, both parents have to work
just to make ends meet, and then struggle to parcel out any leftover
time, if there is any left over, to raise their children. The American
people, frankly, are distracted by their own overly busy, fractured
lifestyles, and the simple, quick solution is currently at a premium
value. The simple, quick solution is at a premium value.
Some in the political sphere have seized upon that distraction and
have made hay out of offering one-liner solutions to the Nation's most
complex problems. Some have discovered that the simple, the catchy, the
obvious, the easy will sell like hot cakes to an American public
frustrated by the demands of making a living and disappointed by a
political system that no longer seems to matter in their own daily
lives.
Is the American public weary of budget deficits? You bet they are.
Well, then, pass a constitutional amendment to balance the budget; it
is just that simple.
Our forefathers did not intend that the Constitution never be amended
for all time. They provided an article, Article V, which provides for
the amending of that document if two-thirds of both Houses and three-
fourths of the States give their approval to amending the Constitution.
It can be done; it has been done. We have 27 amendments, 17 since the
original 10 that we refer to as the Bill of Rights. I, myself, voted
for five of those amendments here in this body.
But here, we are talking about an amendment that would burst at their
seams the very pillars on which this constitutional system rests: The
separation of powers and checks and balances. That is what it amounts
to. I will go into that with greater particularity on another day. But
the Framers in writing the Constitution intended that it endure for
ages to come, and that, consequently, it be adapted to the ``various
crises of human affairs.'' Those of the words of John Marshall. So in
the midst of all of this hustle and bustle, and the search for
expediencies, easy answers, why do we not just throw out the
Constitution and start all over? Or perhaps we should do it by
stealth--do it by stealth--under the cloak of a balanced budget
amendment to the Constitution.
Mr. President, that is why the American people have a right to know
what this amendment will do. Let us take a close look at House Joint
Resolution 1.
I want to appeal to that jury out there, that jury which during this
debate is viewing the electronic eye. And among that jury, I am
appealing to Senators, Senators
perhaps in particular at this moment. I want to make my case before
that jury, and I hope that with a little patience, because talk becomes
tedious at times, especially on this occasion when I will be explaining
the flaws in this amendment--it may become a little tedious. May I say
to the men and women of the jury, please be patient, because I am going
to prove beyond a reasonable doubt that this constitutional amendment
to balance the budget is filled with flaws, that it will not work, that
it cannot work and that the committee in its committee report admitted
essentially that there were problems with it and sought to provide the
escape doors through which we might run from that problem.

I am going to prove that beyond a reasonable doubt, for all those who
will take the patience to listen. Bring on your ready response team. I
saw on television one evening on the evening news that my friend, Mr.
Dole, had brought out, I believe, 9 or 10 Senators from the other side
of the aisle--and maybe 1 from this side, I am not sure--and it was a
ready response team. They were going to ``wear him out,'' talking about
Robert Byrd. They were going to wear him out. Well, bring on your ready
response team now, while I am speaking. Bring them on. I will yield for
questions. I will yield for statements by unanimous consent. But do it
now. You remember the little ad on TV, ``Do it here, do it now.'' Well,
do it here, do it now. All right. To the ready response team I say,
``come on, do it here, do it now, while I am on the floor. Bring out
your 9 or 10.
I want to focus on this measure, because just as Toto pulled back the
curtain to expose the not-so-mighty Wizard of Oz, the curtain must be
pulled back on this resolution so that the American people, too, can
see that it is political sorcery, political witchcraft, political black
magic.
Section 1 of the proposed constitutional amendment on this chart to
my left, so that the jurors can read it for themselves, reads:

Total outlays for any fiscal year shall not exceed total
receipts for that fiscal year, unless three-fifths of the
whole number of each House of Congress shall provide by law
for a specific excess of outlays over receipts by a rollcall
vote.

I will speak at a later time about this clause which deals with the
supermajorities that are built into this amendment. There are 9
supermajorities in the Constitution of the United States and the
amendments thereto. Six supermajorities are provided for in the
original Constitution, one supermajority is provided for in the 12th
amendment, one in the 14th amendment, one in the 25th amendment, making
a total of 9 supermajorities built into the Constitution and amendments
thereto. I will talk about that.
I will repeat this first quote from Section 1: ``Total outlays for
any fiscal year shall not exceed total receipts for that fiscal year *
* *.'' That means that total Government spending for any fiscal year
shall not exceed total receipts--``* * * shall not exceed * * *'' the
money taken in by the Government.
That language probably sounds fairly straightforward. It should be
easily understood: ``Total outlays for any fiscal year shall not exceed
total receipts for that fiscal year * * *.'' But if we accept that
requirement, if we rivet that quack nostrum into the Constitution of
the United States, then the obvious question is, can we ensure that, in
fact, outlays do not exceed receipts? That is what the mandate says
here. How are we supposed to comply with that constitutional mandate?
Simply stating that outlays shall not exceed receipts is nothing more
than an empty incantation; just to say it is more than an empty
incantation. Stating it will not automatically make it happen, any more
than if we said there will be no more poverty, no more crime, or no
more pollution. There would still need to be some sort of mechanism to
carry out the goal. That, of course, is also true of balancing the
budget.
[[Page S2376]] Everyone should realize that there has to be a plan
in order to actually get the budget into balance. That is what many of
us have been trying to get the proponents of the amendment to tell us.
Show us the plan. Let the American people see your plan for balancing
the budget. The people have a right to know.
But, Mr. President, proponents of the amendment tell us not to worry.
They say that a constitutional amendment is not the place to put the
particulars, or details, or how we achieve a balanced budget. They say
that section 6 of the proposed amendment requires Congress to develop
its own enforcement mechanism by passing implementation legislation--by
passing implementing legislation. Congress will enforce it, says
section 6 of this constitutional amendment. If that is the case, then
the American people have a right to know what that section says.
Section 6--here it is on the chart to my left--reads as follows:
``The Congress shall enforce and implement this article by appropriate
legislation, which may rely on estimates of outlays and receipts.''
For the public to understand what kind of wonder drug they are being
asked to swallow, they need to fully understand that specific section
of the resolution. And once they do understand it, Mr. President, I
believe they will know that this amendment is nothing more than
political witchcraft.
Section 6 of the resolution, of the balanced budget amendment, states
that ``The Congress shall enforce and implement this article by
appropriate legislation, which may rely on estimates of outlays and
receipts.''
Again, Mr. President, such language would appear rather
uncomplicated. But if we take a closer look, especially at the latter
half of that sentence, we will see that the entire premise of this
amendment is as shaky as a house of cards. Indeed, in one single word--
the word ``estimates''--we find the Achilles heel of the whole balanced
budget amendment concept, be it House Joint Resolution 1 or some other
version. The Achilles heel is the word ``estimates.''
Following that, let us zero in on the word ``estimates.'' If we
follow the directive of section 6, then the central tenet of our
enforcement mechanism, we would see, is to be based on ``estimates of
outlays and receipts.'' Now get that. ``The Congress shall enforce and
implement this article by appropriate legislation, which may rely on
estimates of outlays and receipts.
What the public needs to know, but what they are not being told, is
that, unlike most individuals who will receive a set salary or wage for
the year and whose expenses are relatively stable, total outlays and
total receipts of the Federal Government are never, never, never
known--and in fact they cannot be known--at the beginning of any given
fiscal year. It is impossible for the total receipts and the total
revenues to be known at the beginning of any given fiscal year. All the
President and Congress have to work with, when they begin to put the
budget together, are estimates provided to them by the Office of
Management and Budget and the Congressional Budget Office--estimates,
nothing more.
If we have learned nothing else over the past 15 years, it is that
actual outlays and actual receipts in any given year can, and generally
do, vary from those estimates by billions of dollars--not millions, but
billions of dollars. In fact, in most years, actual outlays and actual
receipts do not even come close--do not even come close--to what the
experts projected at the beginning of the fiscal year.
Estimates are not accurate. They never are. And if they ever will be,
it will be pure happenstance and it will not happen often.
As these charts to my left will show, outlays, receipts, and deficits
have consistently been misestimated in every one of the 15 years from
fiscal year 1980 through fiscal year 1994, inclusive. No exception. In
every one of those 15 years--from fiscal year 1980 through fiscal year
1994--the outlays, receipts and deficits have been misestimated.
Mr. President, before turning to the specifics of these charts, let
me emphasize that the data presented here come from the independent and
nonpartisan Congressional Budget Office. That office, created by the
1974 Congressional Budget Act, is charged with the job of assisting
Congress in the preparation and analysis of the budget by providing us
with the economic and budget data we need throughout the year. As part
of those duties, they are responsible for closely monitoring the
Government's deficits. But, as we shall see, despite all the expertise
of the individuals who work in that office, they remain powerless--
absolutely powerless--to provide the accuracy that would be required
under this amendment. They are the best in the business, but they will
never, never be able to produce what this amendment calls for.
Let us look at the first chart. This first chart shows the difference
between revenues, as estimated in the first budget resolution for each
of fiscal years 1980 through 1994, versus what those revenues actually
turned out to be.
The estimate of the revenues versus what the revenues actually turned
out to be.
Starting on the left, the viewer's left, on your left out there
looking through that electronic eye, starting on your left with fiscal
year 1980, we can see that actual revenues collected by the Federal
Government were $11.1 billion more than what had been forecast in the
budget resolution for that year. Eleven billion dollars, Mr. President.
Then in fiscal year 1981, revenues fell short of the estimate by $11.3
billion. In fiscal year 1982, revenues fell short of the estimate by
$40 billion. For fiscal year 1983, revenues fell short of the
estimate--in other words, the income of the Government, the actual
income of the Government for that fiscal year fell short of the
estimate--by $65.3 billion.
Now I will not take each year, but the viewers can see that in only 1
year were the estimates really close. In that year, they missed the
estimate by $1.7 billion. But look at the other wide ranges--$55
billion in 1991, $77.5 billion in 1992. The actual revenues missed
estimated revenues by $77 billion in that year.
The point I am making here is that in no year, in no year, were the
estimates accurate--not one year--and range as far off, as I say, as
$65 billion in fiscal year 1983 and, in 1992, $77.5 million, the errors
between the actual revenues and the estimates.
Now we are talking about the word ``estimates'' in this
constitutional amendment, in this balanced budget constitutional
amendment. I want to keep our attention on the word ``estimates'' and I
am showing that the historical record here clearly, clearly, is
convincing that estimates are always wrong. They have always been
wrong.
So all in all, those who have done the estimating have not produced a
very good record.
Now this next chart shows for the same 15 fiscal years the difference
between estimated outlays--that is the money the Government spends
out--the difference between the estimated outlays, as contained in the
first budget resolution, and what those outlays actually were. In other
words, the difference in what the Government actually spent, as against
the estimates of what the Government would spend.
So what was estimated on the one hand and what the outlays were on
the other hand was a vast difference.
So, starting again on the viewer's left, with fiscal year 1980, we
can see that outlays were actually $47.6 billion more than what the
budget resolution had estimated. If we were to pass a budget
resolution, we should pass it by May of each year for the following
fiscal year. This year, 1995, we should expect to pass a budget
resolution by May for the next fiscal year, which begins on October 1
this year and goes through September 30 next year.
In fiscal year 1981, outlays were $47 billion greater; in fiscal year
1982, the outlays were $33 billion greater;
And so on and so on.

The point I am making here, and the viewers can see for themselves
from the chart the errors between the actual outlays, the actual spend-
out by the Government as against the estimated outlays, the estimated
Government spending, and the viewers will see, again, that in no year
was there an accurate estimate.
The green line here, represented by ``0,'' represents a situation in
which the estimates and the actual outlays would be right on, so that
the ``zero miss,'' a ``zero miss'' estimate--because the estimate would
be accurate--hit
[[Page S2377]] the nail right on the head. That is the green line.
Therefore, the bars represent in each year how much the estimates
were off, one way or the other. In some years, the actual outlays were
more than the estimated outlays represented by the red line. In a few
years, the actual outlays were less than the estimates; in one
instance, $91.9 billion less than the estimates. That was in 1993, when
we adopted the budget reduction package for which not a Member on that
side, not one, not a Republican Senator, not a Republican House Member,
voted for that budget deficit reduction measure.
The point again, as I say, looking at the zero line, meaning absolute
accuracy, one can see how much in each year the estimate missed the
point.
What I am showing here is, if we keep our eye on that word
``Estimates,'' we will see that the estimates are always off, one way
or the other.
Now, chart 3 gives the differences between the actual budget totals
and the first budget resolution estimates for fiscal years 1980-94, the
same period that was addressed by the preceding two charts. The error
between the actual and the estimated deficits in billions of dollars--
again, the source of the information is the Congressional Budget
Office, the office we depend upon here as we formulate our budget.
Since the difference between the revenues and the outlays--one chart I
have already shown dealt with revenues, the money taken in; the other
chart I have used dealt with outlays, the money that the Government
spent.
This chart, then, combines the two, in essence, and gives us the
difference between the actual budget totals and the first budget
estimated deficit for fiscal years 1980-1994--the actual deficits.
Since the difference between the revenues and the outlays, the
difference between what the Government takes in on one hand and what
the Government has to spend on the other is what makes up the deficit,
this third chart shows the difference between what the deficit was
estimated to be and what it actually turned out to be for those fiscal
years 1980-1994. Again, the green line represents ``zero miss,''
meaning the estimate was right on target, the actual was right on
target with the estimate. It was not missed.
For fiscal year 1980, the deficit was $36.5 billion--$36.5 billion.
Now, I see the response team gathering. I am glad. For fiscal year
1980, the deficit was $36.5 billion, greater than had been estimated.
For the next year, 1981, the deficit was $58.3 billion larger than had
been estimated. For fiscal year 1982, $73 billion larger. For fiscal
year 1983, the deficit was $91.4 billion greater than had been
estimated.
Keep your eye on the word ``Estimates.'' Skip over here to 1990; the
budget deficit was $119.1 billion greater than had been estimated, and
so on. Those who are viewing the chart to my left can see for
themselves.
In 2 years, the deficit was less than the estimate. But the point is
that in no year was there accuracy. Almost accuracy, very close, in
1984--missed by $3.7 billion. In 1987, it was missed by $6.2 billion.
But look at the range: From $36 billion to $91 billion to $119 billion
to $71 billion--off. That is not an inconsequential error. That is not
an inconsequential figure.
So the point is that in all of these years covered by the chart, the
estimates were off. The point of these charts is to show that all
efforts to estimate outlays and receipts accurately have repeatedly
failed--repeatedly failed. Every single year for the past 15 years, the
estimators have failed to accurately estimate what the deficit would
be.
In addition, I would also make the point that we do not know if the
CBO's estimate is off, or if it is, by how much. Get this: We do not
know if the CBO's estimate is off, or if it is, by how much until after
the fiscal year has been completed. There is no way in God's Heaven,
with all of His troops of angels that one--I should not say that about
God. I suspect He can foresee these things. But there is no way on
Earth that we can know what the revenues will be, that we can know what
the outlays will be, until the fiscal year is over and gone, until
after September 30. We will not know how much the outlays are off, how
much the receipts are off about this particular fiscal year we are in,
until after next September 30 is gone, gone with the wind, and we will
not even know it then because the Treasury probably will not have its
final receipts and outlays until October 15, or some such.
We simply cannot know with any exactitude what the deficit will be
during that fiscal year. By the time we do know, though, it will be too
late to correct the problem, at least under the balanced budget
amendment. It will be too late to correct the problem, because what was
the instruction in Section 1?
The instruction was, in section 1--the mandate:

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

We will not know what the total outlays are. We will not know what
the total receipts are for this fiscal year until it is gone,
until the fiscal year is gone, marked off the calendar. In other
words, using estimates of revenues and outlays--the money that comes in
and the money that goes out--it is virtually impossible to determine
whether or not the budget will be in balance until after the fiscal
year is over, after the horse is out of the barn; the doors are open
and out go the horses. Too late. In 11 of the past 15 years, revenues
have been lower than expected, and in 10 of the 15 years, outlays have
been greater than expected.

Let me say that again. In 11 of the past 15 years, revenues have been
lower than the estimates, and in 10 of the 15 years, outlays have been
higher than the estimates. And there is nothing in this resolution--
nothing in this resolution--or in any other resolution or in any other
version of the balanced budget amendment that can correct that problem.
Nothing. There is not one among the 100 Senators who can come up with a
version that will correct it. Not one. Not 100 working together can
correct, can find a way to accurately estimate what the revenues will
be, what the outlays will be, what the deficit will be in any fiscal
year. You cannot do it until the chapter is closed, the receipts and
the outlays are in and, by then, the door on the fiscal year is gone,
closed.
How then are we going to come forth with this mandate: ``Total
outlays for any fiscal year shall not exceed total receipts for that
fiscal year.* * *''?
Yet, Mr. President, despite knowing that the estimates we must work
with will inevitably be in error--inevitably--they are exactly what
this balanced budget amendment would have us rely on, the word
``estimates.'' Remember, it says, right there in section 6, that we
``may rely on estimates of outlays and receipts.''

Section 6. The Congress shall enforce and implement this
article by appropriate legislation, which may rely on
estimates.

That is weak, it has no foundation.

may rely on estimates of outlays and receipts.

If you cannot rely on the estimates, then how can you help but
violate this mandate? If estimates cannot be relied upon, then how can
we avoid violating this section 1:

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

It does not say ``may not.'' It says ``shall not.''
So it says there in section 6 that Congress ``may rely on estimates
of outlays and receipts.'' That is it.

The Congress shall enforce and implement this article by
appropriate legislation, which may rely on estimates of
outlays and receipts.

Now, what does that mean? What are we talking about? As I say,
section 1 states:

Total outlays for any fiscal year shall not--

Shall not, shall not, shall not--

exceed total receipts for that fiscal year.

No ifs, ands, buts or maybes--``shall not.''

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

Then how will it be done? How will it be done? The magic incantation
in section 6 is that the ``Congress shall enforce and implement this
article by appropriate legislation, which may rely on estimates of
outlays and receipts'' even though we know, by the record, that the
estimates we must work with will inevitably be in error. They are
exactly what this balanced budget amendment would have us rely on. It
says so. That is what it says. I did not say it. It says so. It says we
may rely
[[Page S2378]] on estimates of outlays and receipts in balancing that
budget. We already have a process for estimating revenues, outlays, and
deficits prior to each fiscal year, and as we have seen by the evidence
that I have shown, it is far from perfect.
So what is Congress to do? It is ludicrous to think that just because
we adopt this balanced budget amendment we will somehow come up with a
new system that will accurately predict balanced budgets in advance of
each fiscal year. As I say, it cannot be done. Einstein could not do
it. Worse than that, Mr. President, is that we will never know if our
estimates are off or how much they are off until it is too late to
correct that problem. We will not know it, at least not in time to fix
the imbalance. These revenue and outlay numbers cannot be calculated
until after a fiscal year is over. Therefore, we have no way of knowing
during the fiscal year whether or not outlays are going to exceed
receipts until it is too late.
Yet, the clear language of the amendment states in no unmistakable
terms, in simple, down-to-Earth English: Outlays ``shall not'' exceed
receipts. That is what the amendment says. I did not write it. I did
not write that amendment, but that is what it says: Outlays ``shall
not.'' No ifs, ands, buts, maybes--outlays ``shall not'' exceed
receipts.
Of course, it would be easy to say that all we needed to do to
correct the dilemma is to find more competent budget analysts. Let us
throw the rascals out and hire a whole new batch of analysts.
Unfortunately, it is not that simple. The plain truth is that the men
and the women who helped put these figures together each year are not
at fault. They are not at fault. They are as good as one could find
anywhere in the four winds.
If not the analysts, then who is this culprit? In simple terms, the
miscalculations that we have seen displayed on these charts can be put
into three categories: Policy miscalculations, economic
miscalculations, and technical miscalculations. Those are the terms
used by the Congressional Budget Office to explain the differences
between the budget estimates and what actually occurred each year:
Policy, economic, and technical.
The first of these terms, policy, refers to any portions of these
differences that can be attributed to the Congress' passing legislation
that was not accounted for in the estimates.
However, over the 15 fiscal years represented on these charts, policy
differences accounted for the smallest amount of estimation error. In
fact, enactment of legislation by the Congress since 1990 has been but
a very small portion of the deficit error. The reason for that, Mr.
President, is the pay-as-you-go requirement and the spending caps that
were instituted with the 1990 Budget Enforcement Act--which I insisted
on in talking to Mr. Darman right down in my office--the pay-as-you-go
requirement, the spending caps that were instituted with the 1990
Budget Enforcement Act and extended in the summer of 1993 through the
Omnibus Budget Reconciliation Act. Those caps are tough new
requirements that have worked to restrain spending, because the only
way around them is with the designation of an emergency.
The second reason for the difference between actual versus estimated
revenues, outlays and deficits, is attributed to the failure of budget
analysts to anticipate the actual performance of the economy.
I know that some Americans may not be aware of the fact that when the
budget is put together, it is based on certain economic assumptions.
Factors such as the gross national product, the unemployment rate, the
inflation rate, and interest rates must be assumed for the upcoming
year. They have to be assumed because they cannot be known.
Therefore, if more Americans are unemployed than had been
anticipated, the Government will have larger outlays for unemployment
insurance benefits, food stamps, and so on, than originally thought.
This larger payout for these benefits would then be categorized as an
economic error. Likewise, if interest rates unexpectedly go up, then
the amount of interest we have to pay on the national debt would be
higher. This, too, would be considered as an economic error. Nobody can
help it, and no one could foresee it. It just happens.
Mr. President, to illustrate the point, we can look to the recent
recession. Because that recession was deeper than expected, and the
recovery weaker, revenues unexpectedly fell in fiscal year 1992. As a
consequence, lower-than-projected revenues, due to the economy's
failure to perform as expected, caused the fiscal year 1992 budget
deficit to exceed the budget resolution's deficit estimate by $11.4
billion.
Finally, the third reason why estimates are inaccurate is due to what
CBO calls technical differences. This category contains a number of
items. Most notable among these are the miscalculations due to rising
health care costs associated with the Medicare and Medicaid programs.
Mr. President, I know all of these explanations and numbers must be
mind-numbing to the American people, but they should not be mind-
numbing to Senators. The fact that this material may be dry does not
make it any less true or important. What is most critical, though, is
that the public understands that errors attributable to economic
factors--things like higher-than-expected interest rates, or higher-
than-expected unemployment--accounted for 64.2 percent of the $28
billion average error in the deficit projection. What that means,
simply, is that of all of the factors that account for deficit
estimates being out-of-sync with reality, nearly two-thirds of the
average error over the past 15 years was due to factors that we will
never be able to correct, unless, of course, someone has a crystal ball
that can accurately tell us at the beginning of each year what the
unemployment rate, the interest rate, the inflation rate, and the gross
domestic product will be throughout that year. It cannot be done.
Mr. President, this is why I refer to the word ``estimates'' as being
the Achilles' heel of the balanced budget amendment. On the one hand,
under this resolution we would be constitutionally bound--bound--to
balance the Federal budget every year.
That is what it says. I did not write it. That is what the amendment
says. ``Total outlays for any fiscal year shall not exceed total
receipts for that fiscal year.''
But while we struggle with that difficult task, the economic
information we have at our disposal will inevitably be in error, and
two-thirds of that error will be due to factors beyond anyone's
control.
Here comes the response team.
Is this the response team?
Here they are. All right, I am ready to yield any time any one of
them wants to ask me a question or make a correction if I am wrong.
What a balanced budget amendment amounts to, then, is like telling
someone that they must drive their car 100 miles, but only giving them
80 miles worth of gas. No matter how hard they try, or how well-
intentioned they may be, there is just no way on God's green Earth that
they can make up that last 20 miles.
If we know, then, that we must balance the budget--and that is what
the balanced budget amendment says, we must balance it, no ifs, buts,
whereases or why, no excuses. If we know that we must balance the
budget, and we also know that it is impossible to know what it would
take to do that at the beginning of the year, it should be obvious to
everyone that Congress will be forced to pull out its old bag of tricks
and bring back the same old smoke and mirrors and rosy scenarios and
hidden asterisks to make this amendment appear to work. In other words,
we will cook the numbers--cook the numbers--and massage the estimates
in order to be able to try to live up to the new constitutional
mandate. That will not make the new amendment work, but it may, for a
little while, make it appear to work. Rather than rely on my own
imagination, I would now like to read to the Senate and to the American
people a few suggestions for getting around this amendment that come
from the Senate Judiciary Committee's own report that accompanies
Senate Joint Resolution 1, the balanced budget amendment.
So I have already shown beyond a reasonable doubt to those who have
patiently listened that this constitutional amendment mandating a
balanced budget every year cannot work, and it will not work because it
is based
[[Page S2379]] on an uncorrectable flaw, that flaw being the word
``estimates.'' And Congress is to enforce this amendment by relying on
that Achilles' heel, that uncorrectable flaw, the word ``estimates.''
So beyond any reasonable doubt, to any reasonable man, it is obvious,
it is plain as the nose on your face that it is flawed, that it cannot
work, because it is based on the word ``estimates.''
So then what are we going to do? I said I would also prove beyond a
reasonable doubt that the committee report recognizes this is not going
to work. The committee report recognizes that. How many of you have
read that report? Here it is. This is the committee report by the
Committee on the Judiciary when it reported out Senate Joint Resolution
1. This is the committee report that accompanied the resolution, when
the resolution was reported.
So the committee report itself comes up with some suggestions as to
how we might get around it. Why would the committee do that? Why would
the committee itself come up with some suggestions as to how we might
avoid the strict mandate, if the committee itself did not recognize
that there is an uncorrectable flaw? Why would the committee itself
recommend certain suggestions by which we may have escape hatches--the
committee itself?
So, rather than rely on my imagination, I would now like to read to
the Senate and to the American people a few suggestions for getting
around this amendment that come from the Senate Judiciary Committee's
own report that accompanies Senate Joint Resolution 1--the balanced
budget amendment.
Before proceeding, Mr. President, I want to explain that I am reading
from the Senate Judiciary Committee's report on the balanced budget
amendment. On page 19--I will even give you the page number, page 19.
Hear me now. The response team--sit up in your seats. Listen. I am
going to expect you to tackle me while I am on the floor, now. Look on
page 19 of the committee report.
On page 19 of the Senate's report--get it and read it--Senate report
104-5, it is stated that this provision gives Congress--``this
provision'' meaning section 6.
What does section 6 mean? ``This provision''--meaning section 6--
``gives Congress an appropriate degree of flexibility in fashioning
necessary implementing legislation.'' What is meant by ``flexibility?''
The report continues:

For example, Congress could use estimates of receipts or
outlays at the beginning of the fiscal year to determine
whether the balanced budget requirement of section 1 would be
satisfied, so long as the estimates were reasonable and made
in good faith.

Read that again. For example, Congress could use estimates.''
There is that Achilles heel.

. . . could use estimates of receipts or outlays at the
beginning of the fiscal year to determine whether the
balanced budget requirement of section 1 would be satisfied,
so long as the estimates were reasonable and made in good
faith.

Does this mean that, if we pass a budget that is balanced at the
beginning of the year, at least on paper, we need not worry if the
budget becomes unbalanced during the course of the year? Is that the
ideal we are supposed to include in our implementing legislation? Is
that what the sponsors of this amendment have in mind? I think that is
a very different approach than what the American people are expecting
from a balanced budget amendment.
We have already seen that estimates of revenues and outlays are
invariably wrong, and that is understandable, as we have explained. But
the committee report says:

Congress could use estimates of receipts or outlays at the
beginning of the fiscal year to determine whether the
balanced budget requirement of section 1 would be satisfied,
so long as the estimates were reasonable and made in good
faith.

Who knows what reasonable is? Who will be the judge? As Alexander
Pope said, ``Who shall decide when doctors disagree?'' So, who shall
decide what ``reasonable'' is? What may appear to be reasonable in my
thinking may not appear to be reasonable in the next person's thinking.
Who decides what is reasonable? Who will make that decision?
It goes on to say: ``* * * so long as the estimates were reasonable
and made in good faith.''
Who knows what ``good faith'' is? How do we know whether the
estimates were made in good faith? How do we know? Who is to say? Who
is to know whether they were made in good faith? Who is the judge? This
is plainly an escape hatch and it is in the committee report by the
Judiciary Committee. Did the Judiciary Committee not know about the
inconsistencies in the estimates between outlays and receipts? Was
there not anyone on that committee who knew that estimates are
invariably wrong when produced by the CBO, estimates of the revenues
and receipts and deficit? Did anyone ever think of it?
The next sentence states: In addition, Congress could decide that a
deficit caused by a temporary, self-correcting drop in receipts or
increase in outlays during the fiscal year would not violate the
article.
Congress could decide that. Mr. President, what that sentence says to
me, is that, at the same time that the proponents of this amendment are
telling the American people that a constitutional amendment will bring
about balanced budgets, they are telling the Congress that they do not
expect us to practice what we preach. That is just incredible. If we
followed this advice and the Congress codified a broad definition of
the words ``temporary'' and ``self-correcting,'' then we will have
found another escape hatch--aha, there it is, this is another escape
door that we all know will be needed under this amendment. But will
that be what the American people expect from this amendment?
The proponents have trumpeted from the Atlantic to the Pacific, from
the Canadian border to the Gulf of Mexico: This is the wonder cure.
This is the wonder drug, a prescription for budget deficits. A
politician appearing before an audience, can ask the question--I have
been out there on those hustings a few times--``How many of you believe
that we ought to have a balanced budget amendment to the
Constitution?'' All hands will go up. ``Well, I want to tell you,
ladies and gentlemen, you elect me, and I will vote for a
constitutional amendment to balance the budget.''
Get your applause meters going. That is a sure way to ring the bell.
This wonder drug is the way to get votes. It is not a sure cure--it may
be a cure that kills--but it is a sure way to get votes.
Reading again from the committee report--that the Judiciary Committee
wrote for our edification when it reported the constitutional amendment
to balance the budget to the Senate floor--the next sentence states:
``Similarly, Congress could state that very small or negligible
deviations from a balanced budget would not represent a violation of
section 1 .''
Now get that. Let us read that again.
``Similarly, Congress could state that very small or negligible
deviations from a balanced budget would not represent a violation of
section 1''--which says total outlays, total Government spendout, shall
not exceed total Government income in any fiscal year.
How small is small? How small is a negligible deviation? Is the term
deficit now a variable which Congress can manipulate by saying that a
deficit is not a deficit is not a deficit?
It reminds me of Abraham when he intervened on behalf of the city of
Sodom. He asked God, if perchance there were 50 good men in Sodom,
would God destroy Sodom. God said no. Well, perchance there were five
less than 50, perchance there were 45, would God destroy Sodom. God
said no. Well, perchance there were 40 good men, would God destroy
Sodom. God said no. Perchance if there were 30? God said no. Well, even
if there were just 20? God said no, he will not do it. Well, even if
there were just 10? God said no, if there were just 10, he would not
destroy Sodom. So God answered that if there were 10 righteous men in
Sodom, he would spare the city.
This is the same thing in a reverse sort of way.
If Congress could state that very small, or negligible, deviations
from a balanced budget would not represent a violation of section 1,
how small is small? Is it $5 billion? Will you spare us if it is just
$5 billion? Well, they will spare it. Well, what if it is $10 billion?
Will you spare us? May we consider that we balanced the budget if we
only
[[Page S2380]] miss it by $10 billion? Well, we may. How about $20
billion? How about $30 billion? How about $50 billion? What is wrong if
it is $11 billion? How about $12 billion? If $12 billion is only a
``negligible'' deviation, how about $20 billion, $30 billion, $50
billion? Is $75 billion a negligible deviation? How about $175 billion?
So here, Mr. President, one has to ask the question. Where do we
stop? What is ``negligible?'' What is ``small?''
Mr. SANTORUM. Mr. President, will the Senator from West Virginia
yield for a question?
Mr. BYRD. Yes. I will be glad to.
Is the Senator from one of the renowned ``special response'' teams?
Mr. SANTORUM. I am not sure. I asked to come to the floor--
Mr. BYRD. Now is a good time to find out.
Mr. SANTORUM. To listen and to learn. I was just questioning--
Mr. BYRD. I wonder if the Senator would wait until I finish, if we
could.
Mr. SANTORUM. You said ``interrupt me'' any time for questions. So I
thought I was free to do so.
Mr. BYRD. This is really one of the ``ready response'' teams.
Mr. SANTORUM. I was just questioning. Are you suggesting that
negligible amounts could mean rather extraordinary amounts? You are not
suggesting that a Member of the Senate would violate his constitutional
oath of office to uphold the Constitution which requires a balanced
budget? You would not be suggesting that someone would deliberately
violate their oath of office by allowing a large deficit to occur when
the Constitution says that cannot occur?
Mr. BYRD. It depends on what the Senator means. When he said would a
Senator ``deliberately violate his oath of office,'' I am looking at
what the amendment says. I did not write it, Senator. I did not sign
onto that Contract With America. I have not gone around the country
saying that the answer to our deficit problem is a constitutional
amendment to balance the budget. You perhaps did. I did not.
I am pointing out that that constitutional amendment to balance the
budget, which you swore to vote for, probably has flaws. Unless you
rewrite that language that is in that constitutional amendment, which I
did not write, you are not going to correct that flaw, and it is going
to be based on estimates which I have already said are invariably
wrong. It is not whether a Senator would knowingly violate his oath. It
is what the amendment says, that your party for the most part wrote. I
did not write it. I am looking at the language. It is plain,
unmistakable, clear English language.
Mr. SANTORUM. Mr. President, will the Senator from West Virginia
yield for an additional question?
Mr. BYRD. Yes.
Mr. SANTORUM. Mr. President, does the plain, unmistakable, clear
language say the budget ``shall'' not? I mean, is not that very clear
from the language, that it ``shall'' not be?
Mr. BYRD. Read it, in case the Senator has not read it.
Mr. SANTORUM. I have read it on many occasions, just here today.
Mr. BYRD. The Senator has not read it all. It says ``shall not exceed
total outlays for any fiscal year--``shall not.'' It does not say ``may
not.''
Let me respond. Total outlays for any fiscal year shall not exceed
total receipts for that fiscal year. That leaves no wiggle room. You
ought to read that. You and your colleagues who are proponents of this
language ought to take a microscope and look at that language.
Mr. SANTORUM. If the Senator from West Virginia will yield.
Mr. BYRD. It is plain, it is simple.
Yes.
Mr. SANTORUM. That is exactly my point. It is very clear that it says
it ``shall not exceed'' and the suggestion that you have made is that a
$75 billion deficit would be permitted under the Constitution, it seems
to me.
Mr. BYRD. No. No. I did not say it would be permitted. I did not say
it would be permitted. I said under the Constitution no missed
estimates would be permitted. It says what it says. The total outlays
for any fiscal year shall not exceed total receipts for that fiscal
year. I did not say we would permit $5 billion, permit $10 billion or
$75 billion. The Senator was not listening to me. I was talking about
Abraham, and how he approached God, and said, well, if there are 50
men, righteous men, in Sodom, would you spare them? God said yes. What
about 45? Yes. What about 50? Yes. What about 35, 30, 20, 10?
So where do we stop here? That is what I am saying. If you are going
to say in this section 6, the Congress shall enforce and implement this
article by appropriate legislation, which may rely on estimates of
outlays and receipts, and if you are going to say in the committee
report, the Congress could state that very small or negligible
deviations from a balanced budget would not represent a violation, what
is ``small?'' What is ``very small?'' I was saying is 75 very small? Is
that negligible? Is 50 small? So you tell me. What is small in that
context? What is small?
Mr. SANTORUM. Mr. President, if the Senator from West Virginia will
yield for a question.
Mr. BYRD. Yes. I yield.
Mr. SANTORUM. My question to you, Senator, is the language from the
constitutional amendment is very clear, that at the end of the fiscal
year revenues will not exceed--excuse me. Expenditures will not exceed
revenues. That is very clear.
Mr. BYRD. It does not say ``at the end.'' You might want to read what
the constitutional amendment says. ``Total outlays for any fiscal year
shall not exceed total receipts for that fiscal year.'' How are you
going to know until the fiscal year is behind you?
Mr. SANTORUM. That is exactly right. That was my point. You will not
know whether you have met the charge of the constitutional amendment
until the end of the year.
Mr. BYRD. Until the end of the year.
Mr. SANTORUM. That is correct. At that point we will have to have
satisfied that condition. Correct?
Mr. BYRD. The year is gone.
Mr. SANTORUM. That is correct. I am sure the Senator knows that does
not mean that all expenditures or outlays have been in fact expended.
So we could rescind. We could, as has been done here, retroactively
tax. There are all sorts of options available to satisfy that amendment
after the fact.
Is not that the case?
Mr. BYRD. No. Let me finish, will you?
Mr. SANTORUM. You asked me. You permitted me to ask questions. So I
was complying.
Mr. BYRD. I want to answer your question.
Mr. SANTORUM. Thank you.
Mr. BYRD. You stay around.
Mr. SANTORUM. I am not moving.
Mr. BYRD. Mr. President, we have the suggestion that the Congress
could just stand up and declare that certain amounts of the deficit, as
long as we determined them to be ``negligible,'' they are not in
violation of the amendment.
A $25 billion deviation--Congress could say it is OK.
It is small. It is small in comparison to what? When considered in
the context of a budget that is $1.5 trillion, it is negligible. But if
we were to constitutionalize the mandate that outlays must not exceed
receipts--outlays must not exceed receipts, let me say that to my
friend--if we were to constitutionalize the mandate that outlays must
not exceed receipts, a congressional attempt to deviate from that
requirement would bring the moral authority of the entire Constitution
into question. I will say that again. If we were to constitutionalize a
mandate that outlays shall not exceed receipts--that is what the
amendment says. I did not write it. I do not subscribe to it.

Mr. CRAIG. Will the Senator from West Virginia yield?
Mr. BYRD. It does not say ``may not.'' The amendment mandates that
outlays ``shall not exceed receipts.'' If we were to constitutionalize
the mandate, any attempt to deviate from that requirement would bring
the moral authority of the entire Constitution into question. If the
Congress can violate this amendment with impunity, then what other
provisions of the Constitution might be in peril?
Finally--and then I will be glad to yield; we now have two members of
the response team here, and I see another one on the far side of the
enemy territory--if Congress can violate this amendment with impunity,
then what other provisions of the Constitution
[[Page S2381]] might be in peril? Finally, the last sentence in this
paragraph states, ``If an excess of outlays over receipts''--I think
this gets to the question of the Senator from Pennsylvania [Mr.
Santorum]--``were to occur, Congress can require that any shortfall
must be made up during the following fiscal year.''
So there you have it. Now I will take the question of the Senator.
But, you see, this is the final escape hatch that I will mention today:

If an excess of outlays over receipts were to occur,
Congress can require that any shortfall must be made up
during the following fiscal year.

Mr. SANTORUM. If the Senator will yield, in the last sentence, the
operative underlined that I see is the word ``can'' require. They do
not have to do so. But they can. They also have the option, if I
understand, to rescind, retroactively tax, or ``by a three-fifths
vote''--and you did not read the rest of that, but ``by a three-fifths
vote impose a balanced budget.''
So there are options available, are there not, to the Congress and to
the President under the balanced budget amendment?
Mr. BYRD. There we have it. A member of the response team is saying,
``There are options, are there not?'' Let us read this first paragraph
of the balanced budget amendment:

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

It does not give you any option. It does not give me any option. The
American people out there can read and they can understand.
Senator, you can say all you want to, and you can weasel around the
word ``can.''

If an excess of outlays over receipts were to occur,
Congress can require . . .

Well, that is an escape hatch. It can require----
Mr. SANTORUM. Will the Senator yield for a question?
Mr. BYRD. Mr. President, I will yield to the Senator, but I do not
want to be interrupted in the middle of a sentence. I will read it
again:

If an excess of outlays over receipts were to occur,
Congress can require that any shortfall must be made up
during the following fiscal year.

That is an ``option,'' the Senator says. The American people out
there who are reading do not see that option. In the plain, simple
English words of the constitutional amendment to balance the budget:

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

It does not say anything about an option.
I yield.
Mr. SANTORUM. There is a dependent clause after ``Total outlays for
any fiscal year shall not exceed total receipts for that fiscal year .
. .''
It then says `` . . . unless three-fifths of the whole number of each
House of Congress shall provide by law for a specific excess of outlays
over receipts by a rollcall vote.''
So there is an option clearly stated in the constitutional amendment;
is there not?
Mr. BYRD. The Senator was not here when I said earlier that at a
later date, I will talk about the supermajorities. I read it when I
first brought the chart out. The Senator was not here. I first brought
this out, and I read the entire thing, laid it all out. Every time I
raised it to the public view, they could all see the remaining clause.
I said that I will only deal with this first clause.
Yes, it provides for an additional supermajority in the Constitution,
which will raise to 10 the total number of supermajorities that are in
the original Constitution and the amendments thereto. It will be raised
to a new level when we get down to the raising of the statutory debt
limit. So much for supermajorities today. The Senator may say what he
wishes about the supermajority.
Mr. SANTORUM. Mr. President, will the Senator yield?
Mr. BYRD. Yes, I yield.
Mr. SANTORUM. I would like to refer to your charts talking about the
deficit estimates and that they are unreliable. You say they are
estimates at the beginning of the fiscal year. By the Congressional
Budget Office?
Mr. BYRD. Yes.
Mr. SANTORUM. When you say at the beginning--my understanding is that
the Congressional Budget Office issues two reports, one in August and
one in January. Which one does that refer to?
Mr. BYRD. You are talking about the midsession review, the one in
August. But, Senator----
Mr. SANTORUM. Is this the January report you are referring to?
Mr. BYRD. It has to be, which you will learn after a while. I welcome
this exchange. I think that is what has been missing in so much of
this. We all get on the floor and make our speeches, but we do not
debate. So I welcome this exchange and I congratulate the Senator and
commend him. But I happen to be on the Appropriations Committee, so I
know a little about what I am saying. I helped to write the 1974 Budget
Act.
The resolution on the budget should be enacted by May of each year.
And it is only after that budget resolution is enacted that the
chairmen of the Appropriations Committees of the two Houses allocate
those funds to their subcommittees. And it is only after that that the
appropriations bills start coming through.
But prior to the budget resolution in May, the Congressional Budget
Office prepares its estimates of revenues and receipts and deficits for
the forthcoming fiscal year and projects those 5 years down the road.
What I have been saying is that, in addition to the flaw, the word
``estimates,'' which by these charts--and which you are going to ask me
about in a moment--have been shown to be invariably wrong. The
Congress, the House, and the Senate have to depend on those CBO
estimates in enacting the budget resolution, after which, as I say, the
allocations of funds and then the appropriations of moneys come to
pass. But all that is in advance of the fiscal year. It is in advance
of the beginning of the next fiscal year. And we have shown by the
charts that those estimates are invariably wrong.
Now the question.
Mr. SANTORUM. If I may, my question is--and I think you have answered
it in part--that these estimates on your chart reflect an estimate that
was done some 6 months prior to the fiscal year; is that correct?
Mr. BYRD. Yes.
Mr. SANTORUM. Are there not subsequent updates by the Congressional
Budget Office, the Office of Management and Budget, and reports from
the Treasury as to actual receipts and revenues that one could, if one
were in Congress or the Senate, adjust to meet the updated projections
so we would have a better idea where we were going to be by the time we
reach the end of the year?
Mr. BYRD. There is the midsession review. But, I say to the Senator,
that midsession review still is going to be based on estimates. It
cannot actually foresee what the revenues will be for the remaining
months, or what the outlays will be.
Mr. SANTORUM. Mr. President, will the Senator yield further for a
question?
Mr. BYRD. Besides, the nearer we get to the end of that fiscal year,
the greater is the pain if one tries to make a correction in the
remaining 6 months, 5 months, 4 months, 3 months, 2 months, 1 month.
Mr. SANTORUM. Mr. President, will the Senator continue to yield for a
question?
Mr. BYRD. Yes.
Mr. SANTORUM. Is it not possible, under implementing legislation, for
us to require the Congressional Budget Office or the Office of
Management and Budget to put forth a monthly calculation of what the
deficit will be so we have our finger on the pulse of what the revenues
and outlays will be so that, in fact, farther out from that final end
of fiscal year, we might be able to adjust if we see from those
estimates that we are going to run into trouble? In fact, is that not
one of the problems now that we do not do that; we do not react based
on what we know from continuing estimates?
Mr. BYRD. I have two or three things I would like to say in response
to that question. Is the Senator suggesting monthly budget resolutions?
Mr. SANTORUM. No, I am not. I am suggesting that the Congressional
Budget Office could do monthly estimates as to what the deficit will be
for that fiscal year so we might have a better understanding of what we
are going
[[Page S2382]] to be faced with at the end of that fiscal year.
Mr. BYRD. It is going to be pretty difficult for the Congressional
Budget Office to anticipate what interest rates may be a month from
now, 2 months from now. We do not know what Mr. Greenspan is going to
say. The Senator knows that.
Mr. SANTORUM. Mr. President, if the Senator from West Virginia would
yield, they do that now as part of the estimate process.
All I am suggesting is they do it every month as opposed to twice a
year so we have a better idea what we will be facing at the end of that
year.
Mr. BYRD. Once the Senator has been here to see and hear the
prolonged and sometimes bitter debate on the budget resolution--I hope
he would not be suggesting that we are going to have subsequent budget
resolutions every month or so. There can be a substitute one under law.
But here he comes talking about implementing legislation. Who is going
to pass the implementing legislation? Congress, right?
Now, how can the Senator say that 10 years out implementing
legislation will do thus or so, or it will not do thus and so? He may
be here. I doubt that I will be.
Mr. SANTORUM. I hope so.
Mr. BYRD. But nobody can promise what implementing legislation will
do or what it will not do. Nobody can say ``Well, this is not the
intention.'' ``This is not the intention.'' ``That is not the
intention.''
Those are the words of a Senator at a given time here during this
debate. That is not his intention, but nobody can say what the
intention of Senators will be 10 years from now. We are talking about
implementing legislation.
Here we are talking about a Constitution that does not change from
month to month or year to year. It may be here for decades or centuries
if it is not repealed.
Mr. SANTORUM. Mr. President, will the Senator from West Virginia
yield for a question?
Mr. BYRD. Yes, I yield.
Mr. SANTORUM. Is it not customary that constitutional amendments,
after the passage of that amendment, there is usually some legislation
enacted to implement that legislation? Is that normally the course?
Mr. BYRD. Some constitutional amendments state that.
Mr. SANTORUM. It is not unprecedented that we would have an
implementing piece of legislation.
Mr. BYRD. It is not. Some amendments, especially those that were
passed during the Civil War and the Reconstruction era, specifically
provide for implementing legislation.
Mr. SANTORUM. In fact, would you not suggest that with this
constitutional amendment it would be incumbent upon us to pass some
sort of implementing legislation?
Mr. BYRD. Well, it says that Congress shall enforce the act in
section 6, Congress shall enforce it by appropriate legislation.
Mr. SANTORUM. So would you suggest that requires us to pass an
implementing piece of legislation?
Mr. BYRD. I am suggesting that that legislation may rely on estimates
of outlays and receipts, and I am saying that the estimates are
invariably wrong. Consequently, it is an uncorrectable flaw in the
amendment. Consequently, the American people cannot depend upon this
amendment to balance the budget.
And I am saying also that the Judiciary Committee must have known
that when they wrote the committee report to give us several
scapegoats.
Mr. SANTORUM. If I could reiterate my question, does section 6, in
your opinion, require us to pass some sort of implementing legislation?
Mr. BYRD. I will read you what it says. ``Congress shall''--not
maybe, but shall--``enforce and implement this article by appropriate
legislation which may rely on estimates of outlays and receipts.''
Mr. SANTORUM. Mr. President, will the Senator from West Virginia
yield for a further question?
Mr. BYRD. Yes.
Mr. SANTORUM. The next chart that you brought up after those was the
committee report which talked about implementing legislation.
Mr. BYRD. Yes.
Mr. SANTORUM. And from what you read in the plain language of the
constitutional amendment, we are under some obligation to implement
this act by some form of implementing legislation.
Mr. BYRD. We are under an obligation to make that amendment work. And
I am saying we cannot, do not have any intention of making it work,
because the committee is giving us a way out when it says we can rely
on estimates.
Mr. SANTORUM. Would we not have the opportunity to require the
Congressional Budget Office, the Treasury Department, the Office of
Management and Budget, whatever, to come up with more current monthly,
maybe even more often, deficit projections to guide the hand of the
Congress in trying to meet the stated purpose of the constitutional
amendment, which is that expenditures do not exceed revenues? Could we
not do that?
Mr. BYRD. Yes, I hope we would. I hope we would.
Mr. SANTORUM. Would that not at least ameliorate the problem of an
estimate 6 months prior to the fiscal year, fully 18 months before the
end of that fiscal year, which arguably is not going to be exactly
accurate? But, as we all know, as we get closer to the fiscal year and
in the fiscal year, we would have a much better idea of what the final
outcome of that year would be. So we would be able to react.
Mr. BYRD. Senator, it will not work.
Suppose you have a disaster in June, July, August, September, a
disaster that costs $10 billion? You cannot foresee that. You cannot
depend on estimates, if you want to be accurate. And the first section,
section 1, does not give you any room to be inaccurate.
Mr. SANTORUM. Mr. President, will the Senator from West Virginia
yield for a question?
Mr. BYRD. Yes.
Mr. SANTORUM. I go back to this clause, ``unless three-fifths of the
whole number.''
I was looking the other day at the emergency supplemental
appropriations that we have passed in this Congress that violate the
caps, and I noticed an amazing thing. That almost all of them passed by
more than three-fifths of the whole number of the House and Senate. So
we seem to be able to, when faced with some structure of the budget, to
come to a consensus and pass it, in very large numbers, with very large
pluralities, to respond to a national emergency.
(Mr. GRAMS assumed the chair.)
Mr. BYRD. Senator, we do. Sometimes we do not.
But you still add to the deficit, no matter whether you call it an
emergency or not.
I am glad the Senator raised that point, because it does raise some
questions in my mind as to whether that is actually going to be the
case.
Let me read a letter to the President, dated February 7, signed by
the leadership of the other body, Newt Gingrich, Speaker of the House;
Richard Armey, majority leader of the House; John Kasich, chairman of
the Committee on the Budget; and Bob Livingston, chairman of the House
Committee on Appropriations. Here is what it says:

Dear Mr. President: The fiscal year 1996 budget which you
transmitted to Congress contains an additional $10.4 billion
in supplemental budget requests for fiscal year 1995. Your
budget submission further reflects only $2.4 billion in
rescissions and savings for FY 1995. Most of these requests
are for emergencies.
The House Appropriations Committee will proceed to review
and act on these requests but highest priority will be given
to replenishing the accounts in the Department of Defense
badly depleted by contingencies in the Persian Gulf, Somalia,
Rwanda, Haiti and other activities. The committee and the
House, in turn, will act only after offsets for these
activities have been identified. However, we will not act on
the balance of the request until you [meaning the President]
have identified offsets and deductions to make up the balance
of the funding. Whether these activities are emergencies or
not [this is the House leadership writing to the President]
it will be our policy to pay for them rather than to add to
our already immense deficit problem.
We therefore ask you to identify additional rescissions as
soon as possible so we can move expeditiously on your
supplemental request.

Now, there is no guarantee there. There is no guarantee as I read
there from the letter written by the leadership of the other body, no
guarantee that they will agree that such expenditures for disasters
will be considered as
[[Page S2383]] emergencies and, therefore, not charged against the
budget caps.
Mr. REID. Mr. President, would the Senator from West Virginia yield
for a question?
Mr. BYRD. Mr. President, I yield.
Mr. REID. Mr. President, I have been listening to the conversation
between the Senator from West Virginia and the Senator from
Pennsylvania, and I would be interested in whether or not the statement
I am making is true. It is my understanding that interest rates have
been raised the past year six or eight times. Does the Senator from
West Virginia know that to be accurate?
Mr. BYRD. Mr. President, they have been raised several times.
Mr. REID. Would that have some bearing on making estimates?
Mr. BYRD. Mr. President, there is no question.
Mr. REID. Mr. President, in fact, as the Senator from Nevada, it is
my understanding, if we were going to make estimates a year ago not
knowing if the interest rates would be raised, they would be totally
off base as to the estimates because they have been raised a
significant number of times this past year, is that not right?
Mr. BYRD. Absolutely.
Mr. REID. Now, it is my understanding the interest on the debt yearly
payment is over $300 billion a year; is that about right?
Mr. BYRD. About $235 billion.
Mr. REID. And going up as the Fed raises interest rates, so that
would affect your estimates, would it not?
Mr. BYRD. That would.
Mr. SANTORUM. Mr. President, will the Senator yield?
Mr. BYRD. Mr. President, I ask unanimous consent that I, who hold the
floor, may ask the Senator a question.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. BYRD. Mr. President, can the Senator--he was talking about
disasters and how normally there are the votes here in the House and
Senate to respond to supplemental requests for disasters and thereby
waive this deficit requirement as it would appear in the new
constitutional amendment. Does he feel he can assure the Senate that
the House leadership will back off in this statement that they made to
the President in the letter which I read?
Mr. SANTORUM. Mr. President, as the Senator from West Virginia knows
and as we discussed, the three-fifths override provision in the
constitutional amendment is but an option available to this body to
fund emergencies.
Another option that is available is the one that is detailed in that
letter which is to rescind obligated moneys from the prior year.
So that is what they have suggested in that letter, which I think,
given our deficit state at this point, is the most responsible way to
do it. I wholeheartedly support that effort, and I think it is the
responsible way to do it. It can clearly continue to be an option under
the constitutional amendment.
Mr. BYRD. Does the Senator feel that with the House majority
leadership taking a clear and strong position against supplemental
appropriations for this purpose, is the Senator about to tell me that
three-fifths of the House would vote to waive it, with the Republican
majority over there against such a waiver?
Mr. SANTORUM. Mr. President, I suggest to the Senator from West
Virginia that the majority of the Members of the House would vote for a
rescission package to fund it, which would accomplish the same thing.
Mr. BYRD. The Senator is not talking about a majority. He earlier was
talking about a supermajority.
Mr. SANTORUM. I was talking options available. One is a
supermajority, one is a simple majority of rescissions.
Mr. BYRD. I go back to this plain and simple language, Senator. You
can argue with me as long as you want to argue, until you are blue in
the face, but your argument does not, in plain, simple English
language--and that is your amendment; that is the amendment which you
told the voters of Pennsylvania you would support.
Mr. SANTORUM. I suggest that that is exactly what they are doing.
Mr. BYRD. Wait, just wait, Senator. I was not born yesterday.
I am directing your attention to this language. This is the language.
This is what we will vote on. Not what somebody is talking about in
West Virginia or Pennsylvania or anywhere else.
This is the language. ``Total outlays for fiscal year shall not''--
shall not--``exceed total receipts for that fiscal year.'' There is no
option mentioned in that amendment. The option is mentioned in the
committee report.
Mr. SANTORUM. Are we still under the unanimous consent which he has
yielded to me so I can respond, or do I need to ask?
Mr. BYRD. You do not have to ask unanimous consent to ask me a
question.
Mr. SANTORUM. So we are past the point in which you asked me a
question.
Mr. BYRD. Oh, yes, you are on the response team. I am just going to
try to answer your question.
Mr. SANTORUM. Will the Senator from West Virginia yield for a
question?
Mr. BYRD. Mr. President, I yield.
Mr. SANTORUM. You held up the letter from the House Republican
leadership talking about an emergency supplemental appropriation. That
would be an appropriation above what is normally budgeted for?
Mr. BYRD. That is right.
Mr. SANTORUM. What the House leadership responded was, they would be
happy to comply with the request but we want to find other measures
within that budget to offset those expenditures.
Mr. BYRD. As I read, they said they would be happy to comply with the
request as it pertains to defense.
Mr. SANTORUM. But they also said--did they not ask the President to
find rescissions to offset those expenditures?
Mr. BYRD. They did.
Mr. SANTORUM. Which would then comply with the balanced budget
amendment, would it not?
Mr. BYRD. The balanced budget amendment does not say anything about
that.
Mr. SANTORUM. Mr. President, would it not be in keeping with the
balanced budget amendment that they would offset so that the deficit
would show zero based on that particular transaction?
Mr. BYRD. The balanced budget amendment requires a balanced budget,
no matter how you reach it. Got to hit it on the head. There is no
wiggle room, Senator.
Mr. SANTORUM. I am not suggesting there is. I am suggesting what they
are doing is the responsible thing.
Is it not your understanding that what they are saying is that they
want to offset new expenditures with spending cuts from someplace else
in the budget?
Mr. BYRD. That is what they are saying with respect to the disaster
or to those parts of the supplemental requests that do not deal with
defense.
I am not arguing whether they are reasonable or whether they are not.
Mr. SANTORUM. Are you arguing that is outside the purview of the
balanced budget amendment--what they are doing is outside? That would
be violative of the balanced budget amendment.
Mr. BYRD. No, I am not arguing that at all. This is my argument. I
want the Senator to keep in view in his mental vision what the
amendment says. ``Total outlays shall not exceed total receipts for any
fiscal year.''
Mr. SANTORUM. If the Senator from West Virginia will yield for a
question, Mr. President, does that letter that you read to me as an
example violate the constitutional amendment?
Mr. BYRD. Mr. President, no, no.
Does the Senator think it does?
Mr. SANTORUM. I do not.
Mr. BYRD. I do not either, but that is beside the point, as to
whether it violates the Constitution.
Does the Senator have any further questions?
Mr. SANTORUM. I am sure I will. Thank you.
Mr. BYRD. I thank the Senator for his question. I would much rather
have an exchange out here than just standing and reading a speech. I
really mean that. I would like to see more of an exchange rather than
just written speeches. So I am not perturbed by it. I am encouraged by
it. At least somebody is listening.
At least somebody is paying attention, and that somebody is giving me
a chance to answer some questions. I
[[Page S2384]] would be happy if the response team would continue to
gather. Let us have more of an exchange. I apologize to other Senators
who may want to speak.
So there you have it. What a prescription for a balanced budget. That
is a massive loophole. Let me read it again. ``If an excess of outlays
over receipts were to occur, Congress can require that any shortfall
must be made up during the following fiscal year.''
Now, there is another scapegoat. That is a loophole that, if adopted
by the Congress as part of its implementing legislation, would be big
enough for Attila, the king of the Huns, and the scourge of God, to
drive his 700 Scythian horsemen through.
What the sponsors of the amendment are telling us is that, if
Congress cannot figure out what to do, if Congress runs into options
too difficult to swallow, Congress can just require that the shortfall
be made up the next year. Just put it off until the next year.
Now what kind of fiscal shenanigan is this? If you cannot balance one
year, just roll it over to the next? That is not what that
constitutional amendment mandates in the first section; that is not
what the American people are being told. Just roll it over until the
next year. Mr. President, what kind of fiscal witchcraft is this?
Let me emphasize again, these suggestions for dealing with the
deficit under a balanced budget amendment come from the committee's
report. Every Senator, every Senator's office should get that report.
Read the escape hatches for yourselves, and then ask yourself, am I
going to vote for that kind of a sham? Am I going to fool the American
people when they can read, they can see, they can know that amendment
has uncorrectable flaws in it. And the Judiciary Committee must have
understood that when it came through with its committee report
providing for some escape hatches.
As such, these suggestions in the committee report would not become
part of the underlying resolution if it were to pass. They are not
going to be incorporated into the constitutional amendment. They would
not have any force of law. But, nevertheless, they give the American
people some idea of the kinds of gimmicks and evasions the people can
expect to see if this constitutional amendment is adopted by the
Congress and ratified by three-fourths of the States.
The American people are being sold a bag of budget tricks. Is this
what the American people want? Is that what you want, Mr. and Mrs.
America? Are the American people being told about the realities of what
it would take to balance the budget each and every year? The people
have a right to know these things.
As I listen to those who speak in favor of a balanced budget
amendment, I do not hear them telling the public that we really intend
just to carry the deficit over into the following year.
Let us take a look at that chart again. What this committee report is
telling us is that Congress may roll over this deficit from one year to
the next.

If an excess of outlays over receipts were to occur,
Congress can require that any shortfall must be made up
during the following fiscal year.

That means taking the year 1980, for example, when there was a
shortfall between the actual and estimated deficit of $36 billion. So
what this committee report is saying is, ``Senators, just vote it over
to the next year, don't worry about it.''
The next year, we see that it misses by $58 billion and the next year
by $73 billion and the next year over $91 billion.
Mr. SANTORUM. Will the Senator from West Virginia yield for a
question?
Mr. BYRD. Will the Senator allow me to finish? I do not have much
further to read, and I will be happy to yield.
So what they are saying is, ``Roll it over, roll it over to the next
year, that is OK.'' That is not what the American people out there are
expecting from those who are the proponents of this balanced budget
amendment.
The proponents are saying, ``Let's have a constitutional amendment to
balance the budget. Let's do it like you do, Mr. and Mrs. America, you
and your families, you do it every year. We ought to have to do it.''
That is saying we ought to do it like the States have to do it. They
have constitutional amendments to balance their budget. Well, I will
talk more about those pretenses at some other point. But this is what
you are being told; the American people are being told that if there is
an excess in the deficit one year, it can be rolled over to the next.
Senators ought to read this constitutional amendment. They ought to
read the committee report by the Judiciary Committee in the Senate
which accompanied the resolution when it was reported to the floor.
They ought to read it. It will not work. The Judiciary Committee knows
it will not work. One only needs to read the report to understand that
the Judiciary Committee saw there were going to be problems with it.
You will not hear the proponents telling the public that the Congress
will just stand up and declare the deficit ``negligible,'' and so we
are not going to deal with it.
I do not hear them telling the American people that, if this measure
is passed and ratified, the implementing legislation will only require
that the budget be balanced on paper at the beginning of the year. That
is not what the American people are being told.
Tell them the truth. And Senators know they are not being told that.
Senators know or ought to know what this amendment says, what the words
plainly state.
Senators ought not be willing to hoodwink the American people into
supporting something that the American people can read and can
understand. And it is not going to work. The committee report just as
plainly states that.
Mr. President, if this matter were not so serious, if it were not so
dangerous to the delicate separation and balance of powers that were
put in place more than 200 years ago, and if it would not have such
cataclysmic effects on the economic well-being of the American people,
what we have seen today, with respect just to section 6 would be
laughable. It would be laughable. But it is really not laughable. And
the sooner the American people begin to understand that, and the sooner
the Members of this body understand that, the sooner we will realize
the serious policy choices that must be made if we are to put our
fiscal house in order.
Mr. President, how much confidence do even the authors of this
amendment have, if right in the committee report, they start figuring
out ways to get around this amendment? How much confidence do the
proponents have--the sponsors of the amendment--if right in the
committee report they start figuring out ways to get around the
amendment? No, Mr. President, this amendment is not worthy of being
enshrined in our Constitution. It is little more than political catnip
offered to disguise the real difficulty of getting our budgets in
balance. I do not think we should perpetrate this charade upon the
American people. That is what it is.
I want to see our deficits reduced as much as any Senator here wants
to see them reduced. I voted for a package to reduce them in 1990. I
voted for a package to reduce the budget deficits in 1993. So I believe
we ought to get control of them. But not a single Republican Senator,
not one of those who are proponents of this constitutional amendment to
balance the budget voted for that budget deficit reduction measure in
1993. Not one Member of the House, not one Republican Member did that.
And yet today they say we need a balanced budget amendment to the
Constitution.
If it were simply a political sham, which it is, if it were just a
political dodge, which it is, it would be regrettable and unwise to
adopt. But it is much, much worse than those things.
This proposal is dangerous. Within its murky appeal and unsound
formula for budget balance lie the seeds for the further diminishment
of the trust of the people in their Government. They do not trust the
Government much now. They do not trust politicians much now. They do
not trust Members of Congress much now. The legislative branch can ill-
afford any more cynicism and loss of trust. And this Senator worries as
much about the trust deficit as he does about the budget deficit.
[[Page S2385]] Often Members believe that doing what seems to be the
safe thing--in other words, the popular thing--will prove also to be
the right thing. Political correctness is supposed to be the order of
the day, I guess. I believe that endorsing this balanced budget
amendment has taken on the aura of a politically correct act. It has
become a litmus test of sorts--the right choice to make the political
proprietary meter register 100 percent in one's favor.
But whether or not we amend the Constitution in this damaging way is
far too important for us to take the temporarily easy way out. The
American people must be made to understand that once they take a closer
look at this amendment--and I believe that Senators, once they take a
closer look at the amendment and once Senators read the committee
report--they will find that this amendment is far from what it seems.
I hope each Senator will carefully study this amendment before voting
on it. I believe close and open-minded scrutiny of this proposal shreds
it--cuts it to pieces; it will not work; it is quack medicine--reveals
its many shortcomings and unmasks its benign countenance to reveal the
sinister seeds of a constitutional crisis in the making.
Surely we will not travel this road if we are fully aware of where it
may lead. In the days ahead, let us be very sure of just what it is we
propose to do to our country and to our Constitution before we act.
Now, I understand the Senator from North Carolina, my friend from the
State in which I was born, wants to make a speech as soon as I finish.
But before he does, the distinguished Senator from Pennsylvania [Mr.
Santorum] had asked me to yield. I asked that he wait until I finish my
speech, and I thank him for that. I am glad to yield to him.
Mr. SANTORUM. I thank the Senator from West Virginia.
I wish to go back to that chart and again try to find out
specifically what data the Senator is referring to there. I just had
someone look up the 1974 Budget Act and the 1985 Gramm-Rudman-Hollings
Budget Enforcement Act to find out what the timeframe was for estimates
to be given. And my understanding is that--I am sure the Senator knows
the 1974 Budget Act; he was one of the principal writers of it--the
Office of Management and Budget submits a beginning-of-the-year
budgetary assessment on February 1, which just occurred the other day.
They make a midseason review in July or August. That is under the
Budget Act of 1974. The Congressional Budget Office makes a beginning-
of-the-year--which is the end of January--assessment after OMB makes
its assessment and then an end-of-July reassessment.
My question is, the Senator referred to this data being May, roughly
May, springtime, after all the budget resolutions were passed. I do not
see any requirement for a report here, and I am wondering if in fact
this data is not February data as opposed to May or June data.
Mr. BYRD. Yes, it is.
Mr. SANTORUM. It is February.
Mr. BYRD. It is not May. What I said about May was that under the
1974 act, Congress is supposed to pass a budget resolution which lays
out the anticipated outlays, the anticipated receipts and the
anticipated deficits, and then, only after then can the Appropriations
Committee of the Senate--the House committees can go before that, but
only after that budget resolution is passed and sent to conference and
agreed upon can the Senate appropriations committees begin their work.
Sometimes, I guess, we complete the budget resolution perhaps before
May, sometimes we may not, but that was what I alluded to in the case
of May.
Mr. SANTORUM. Mr. President, if the Senator from West Virginia will
continue to yield for a question, so the numbers that the Senator is
saying are in error, the inaccurate estimates, are estimates that were
made 21 months prior to the end of the fiscal year, correct?
Mr. BYRD. Whatever, 21 or 20 or 18 or 19. The point I am saying is
the estimates simply do not work out. They are always wrong. And in
this constitutional amendment here, that is the Achilles' heel. The
word ``estimates'' is the Achilles' heel. They are always wrong.
Consequently, we can never base our actions on those estimates and
expect to balance that budget.
Mr. SIMON. Would my colleague from West Virginia yield for a
question?
Mr. BYRD. Yes, I will be glad to.
Mr. SIMON. First of all, as he knows, I have great respect for him.
He is an extremely valuable Member of this body.
I will tell you what I think is the error of the Senator's assumption
here. First, we can build in, as has been recommended by former
Assistant Secretary of the Treasury Fred Bergsten, among others, about
a 2-percent surplus. That on a $1.6 trillion budget would be about $32
billion.
Second, because we do have to rely on estimates somewhat, we have
talked about having a 3-percent leeway so that you could go 3 percent
below and then that would automatically transfer to the next fiscal
year. That would be $48 billion. Right now, the combination of those
two things would be $80 billion. That would take care of all but two
fiscal years the Senator has on the board there. In those two fiscal
years----
Mr. BYRD. What does the Senator mean by saying it would take care of
all of them, all but two? What does the Senator mean?
Mr. SIMON. Every one of those except two is less than $80 billion.
Mr. BYRD. What is the Senator saying?
Mr. SIMON. Let me go over this again. The recommendation of several
people, including Alan Greenspan and former Assistant Secretary of the
Treasury Fred Bergsten, a recommendation that I concur in, is that we
build in about a 2-percent surplus when we put together a budget. In
terms of our $1.6 trillion budget, that would be about a $32 billion
surplus. Then because no one, as the Senator points out, can know for
sure down to the dollar or even the $1 billion where we are going to
come out, we have made clear in committee that there can be up to a 3-
percent deficit that would be transferred to the next fiscal year.
That would be $48 billion. The $32 billion and the $48 billion combine
to $80 billion. That, every one of those, is less than an $80 billion
differential except for 2 years.

In those 2 years, the procedure would be for Congress to say we can
either, with 60 votes, create a small deficit--but it would be small
indeed, compared to the deficits today--or we could authorize putting
it in the next fiscal year.
It is something that we would have to face. But it is a practical way
of facing this problem.
Mr. BYRD. The Senator said ``something we would have to face?'' The
Senator will not be around here after next year to face it. And I will
not be around here many more years to face it. How do we know what
future Congresses will say? We say we will say that. We say it is not
the intention to do thus and so. How do we know what the intention of a
future Congress will be?
Also, may I say this?
Mr. SIMON. You have the floor.
Mr. BYRD. Please take a look at the amendment which you are
supporting. It does not say anything about building up a surplus in 1
year. It does not say anything about 3 percent or 2 percent or 10
percent or 20 percent. It says, ``Total outlays for any fiscal year
shall not exceed total receipts for that fiscal year * * *''
Napoleon said that on his council there were men who were far more
eloquent than he, but he always stopped them by saying 2 and 2 equals
4.
So I am going to say to you, Senator--and I say this with great
respect, and the Senator from Pennsylvania, and any other Senators on
the response team--2 and 2 makes 4.
Read it. Read what your amendment is saying. ``Total outlays for any
fiscal year shall not * * *.'' It does not say may not. ``* * * shall
not exceed total receipts for that fiscal year.''
Now, 2 and 2 makes 4. Do not come at me with all implementing
legislation, ``We might build up a surplus.''
We will not be around here. How do we know what a future Congress
will do?
``We will do this and we will do that in implementing legislation. We
will build up a surplus. We can roll that over if we hit a year in
which there is
[[Page S2386]] a deficit. We can just roll it over next year.''
Suppose there is a deficit next year?
``Well, we can roll it over.''
Suppose there is a deficit next year?
``Well, we can roll it over.''
That is not what those people over there are being told. And you know
it. And you know it, Senator. We all know it. Read it for yourselves. I
did not write it. I am not going to support it.
Mr. SIMON. Will my colleague yield?
Mr. BYRD. I support getting to a balanced budget. But not this. Not
this way.
Yes, I yield.
Mr. SIMON. Mr. President, I thank him for yielding.
You have to put that together with the language about estimates,
together.
Mr. BYRD. That is just what I did just earlier. I put them together
and came out wrong every time.
Mr. SIMON. All right. And the reality is we do not know--when we come
to September 30, we do not know what the deficit is, or what it is
precisely.
Mr. BYRD. We will not know it.
Mr. SIMON. We do not know that until sometime later. That is why we
make this adjustment. And that is when we will make the adjustment.
I think--and I respect----
Mr. BYRD. This does not say anything about an adjustment.
Mr. SIMON. Pardon?
Mr. BYRD. This amendment? What are we talking about here? I thought
we were debating a constitutional amendment to balance the budget. It
does not say anything about an adjustment.
Mr. SIMON. We are. Well, what I am simply saying is we have built
into this the flexibility to take care of the kind of unknown kind of
situations that you are talking about.
Mr. BYRD. Senator, you say ``we have built into this.'' Where does it
say that in the amendment? Where does it say it?
Mr. SANTORUM. Mr. President, if the Senator from West Virginia will
yield for a question?
Mr. BYRD. I am yielding right now to the Senator. Then I will be glad
to yield.
Mr. SANTORUM. I was going to answer his question.
Mr. SIMON. Just a response to this question, and then I will yield to
my friend from Pennsylvania.
Mr. BYRD. I know what the Senator from Pennsylvania is going to say.
He will say look at that supermajority we provide in there. That is
what he was going to say? Was that not what you were going to say?
Mr. SANTORUM. I would suggest to the Senator from West Virginia he
read section 2 of the article, which requires a three-fifths vote to
increase the debt limit.
Mr. BYRD. Yes, another supermajority. That is the 11th
one.
Mr. SANTORUM. That is the safeguard against deficits. We cannot just
incur a deficit because we have to raise the debt limit. We cannot
raise the debt limit without a three-fifths majority. Thereby we are
bound to do something about the deficit. So we will be forced, as the
Senator from Illinois was saying--here is the enforcement. Here is the
teeth right within the constitutional amendment. Section 2 requires us
to have a vote on debt limit increase, and when we get to zero we will
have the debt limit and we should not have to change it ever.
That is the enforcement mechanism. That makes us come here and do
something about it to comply with section 1 of the constitutional
amendment.
Mr. BYRD. The Senator is now talking about providing for a minority
veto, a minority veto. The Framers provided for a majoritarian,
democratic rule. The Senator is now talking about reverting to
nondemocratic supermajority rule.
I was going to wait until another day to talk about these
supermajorities.
Mr. SIMON. Will my colleague yield?
Mr. BYRD. And I will. But what he is saying here is that any Senator
can, as a ticket for his vote--as a ticket for his vote to raise the
debt limit, as a ticket for his vote to waive the deficit
requirements--may say to the majority, ``I want mine. I want my special
project. I want my special program. That is my ticket, Mr. Majority. I
will give you my vote and help you get that two-thirds, but I want
mine.'' As a consequence, we will end up adding to the deficits rather
than reining them in.
Is it a little hard to understand? Maybe.
Mr. SIMON. Will my colleague yield on that question, on that point?
Mr. BYRD. Oh yes, yes.
Mr. SIMON addressed the Chair.
Mr. BYRD. Let me say just another word about these supermajorities.
Mr. SIMON. Is it not true that there are eight provisions in the
Constitution right now requiring a supermajority?
Mr. BYRD. No, that is not true.
Mr. SIMON. I beg to differ with my colleague.
Mr. BYRD. I will show you the Constitution.
Mr. SIMON. On most things, he is correct.
Mr. BYRD. In this, I am correct. In the original Constitution, there
are six. In the 12th amendment, there is one dealing with the election
of the Vice President by the Senate. In the 14th, there is one dealing
with the waiving--in the case of individuals who have taken oaths of
office and who participate in a rebellion against the country, two-
thirds of the Congress may waive that and allow the person--two-thirds
may waive that disability. And in the 25th amendment, where it talks
about the disability of the President, there is a supermajority.
So, Senator, when you start talking about the Constitution, let us
both sit down and read it together. There are not eight, or whatever
the Senator said. There are six in the original, one in the 12th, one
in the 14th, and one in the 25th amendments to the Constitution, making
a total of nine.
That is a minor matter.
Mr. SIMON. I will take your word it is nine rather than eight. But
the point is, this is not something startlingly new. Those provisions
are in to prevent Government abuse. And I think we have had Government
abuse.
The second point I ask----
Mr. BYRD. Wait just a minute. The Senator is not going to get off
with that. I am going to yield to him. I am not going to shut him off.
He is not going to get away with that.
Most supermajorities are in the Constitution to protect the structure
of that Constitution. Let us talk about expulsion, the expulsion of a
Senator, or the conviction of a President in an impeachment trial. They
are there to protect individual rights. Those two supermajorities are
there to protect individual rights.
In the case of a veto, the exercise of a Presidential veto, that
supermajority is to protect one branch against another.
As a matter of fact, it was stated at the Constitutional Convention
by one of the Framers that one of the reasons the President ought to
have a veto was to protect himself against the legislative branch.
There are various others that are claiming to protect individual
rights. They are not supermajorities to nail down some fiscal policy.
The Constitution does not embrace somebody's fiscal policy. So there
were good reasons. Those are not the reasons these two new
supermajorities that we are about to inscribe in the Constitution are
for.
Mr. SIMON. But one of the things those who founded our Government
talked about is taxation without representation. And one of the reasons
that Thomas Jefferson favored a balanced budget amendment to the
Constitution is he said one generation should no more be obligated to
pick up the debt of a previous generation than to pick up the debt of
another country.
Mr. BYRD. Thomas Jefferson was not at the Constitutional Convention,
as the Senator knows. He was the President of the United States from
1801 to 1809, and when he was President, why did not he ask the
Congress to adopt a constitutional amendment to do that? Why did not
he? He did not do it. No constitutional amendment was ever sent. Why
did not Jefferson do that?
Mr. SIMON. I would be pleased to respond, because George Washington
operated this country very frugally. Then, in his Farewell Address,
George Washington warned do not get the country into debt. We followed
that advice, really followed it up until not too many years ago. Then
we lost that sense of responsibility. But it is very interesting in
Thomas Jefferson's first term he reduced the small Federal debt we had
in this country by 50 percent.
[[Page S2387]] Mr. BYRD. It was also interesting that Jefferson took
advantage of the opportunity--I am glad he did--to buy the Louisiana
Territory, 1,827,000 square miles for $15 million; less than 2\1/2\
cents per acre, extending from the Gulf of Mexico to the Canadian
border, from the Mississippi to the Rockies. I am glad he did. He went
into debt for it. Where did he get the money? He borrowed it from the
banks. That debt, $15 million in that day, was 1.9 times the total
budget for that year. If that were to happen in this year, when we have
a budget of $1.6 trillion, and if we bought the Louisiana Territory and
it cost us 1.9 times the amount of the Federal budget, you could figure
that for yourselves. That has to be something like, about $3.1
trillion. I am glad he did. I am glad he went into debt. When going
into debt, he benefited all of the ensuing generations from then until
kingdom come.
Mr. SIMON. My colleague is absolutely correct. In fact, he
illustrates the point that this constitutional amendment has that
flexibility.
Mr. BYRD. Wait a minute. It also illustrates that Jefferson was
embarrassed by what he had said, and later he said he was embarrassed
by it. But he said because of the laws of necessity the means sometimes
are worthy of the end.
Mr. SIMON. Let me add that the treaty was signed in Paris in May. In
those days you did not find out what had happened for a while. When
word got to Washington, DC, in July--and I apologize to my colleague
from North Carolina--when word got to Jefferson in July in Washington,
DC, he was as startled as anyone else by the Louisiana Purchase.
Our Secretary of the Treasury at that point was a man named Albert
Gallatin, many States have Gallatin counties named for him. Most people
do not know for whom Gallatin is named. Albert Gallatin objected to the
Louisiana Purchase, or part of it, because part of the agreement was
that the bonds were 5 percent. They could not pay back any of it for
the first 15 years. He wanted to pay it off very, very quickly. But the
really important point here is that there were two votes in the U.S.
Senate on the Louisiana Purchase. There was one vote in the House of
Representatives on the Louisiana Purchase. I do know the precise
totals. It was something like 26 to 3, or something like that, in the
Senate, and all of them were far more than the 60 percent required by
this constitutional amendment.
So this amendment would not have blocked the Louisiana Purchase, I
want to assure my colleague from West Virginia.
Mr. BYRD. I did not say the amendment would have blocked the
Louisiana Purchase. I am saying, like Napoleon did, that two plus two
equals four. Read it.
Mr. SIMON. I do not disagree.
Mr. BYRD. ``Total outlays for any fiscal year shall not exceed total
receipts for any fiscal year.'' You cannot get away from it. It has you
by the neck.
Mr. SIMON. The Senator and I differ. But I thank him for yielding to
me.
Mr. BYRD. I thank the Senator.
Mr. FAIRCLOTH addressed the Chair.
Mr. BYRD. Mr. President, I apologize to my friend from North
Carolina. I thank the Senator from North Carolina. Let me thank the
Senator from Pennsylvania. He made a good try.
I have not yielded yet. I have not yielded the floor yet.
Mr. FAIRCLOTH. I thank the Senator.
Mr. BYRD. I will in just a moment.
I want to commend and compliment the Senator from Pennsylvania. He
did the right thing. He raised his questions. I learn when people ask
me questions. And I hope that the listening audience learns. That is
the purpose of this, that others who may have a chance to listen,
hopefully will listen, may learn something from the questions and from
the answers. I do not know all the answers. I do not claim to know
that. But I fervently believe the position I am taking, and I think
that a clear reading of the amendment supports me.
I thank my Senator from North Carolina for yielding. I beg his pardon
for delaying him.
I yield the floor, Mr. President.
Mr. FAIRCLOTH. I thank the Senator from West Virginia. I thought he
had yielded the floor.
The PRESIDING OFFICER (Mr. Smith). The Senator from North Carolina.
Mr. FAIRCLOTH. Mr. President, I ask for 20 minutes to discuss the
Reid amendment.
Mr. REID. Mr. President, parliamentary inquiry.
The PRESIDING OFFICER. Does the Senator from North Carolina yield for
a parliamentary inquiry?
Mr. FAIRCLOTH. I yield the floor for 1 minute to the Senator from
Nevada.
Mr. REID. I did not hear. Is the Senator from North Carolina speaking
on the matter before the Senate?
The PRESIDING OFFICER. The Senator has been recognized to speak.
The Senator from North Carolina.
Mr. FAIRCLOTH. Mr. President, I will address the Reid amendment. But
there are other things I am going to say first with reference to it.
Mr. President, I rise today in strong support of the balanced budget
amendment to the Constitution. Mr. President, quite simply, no other
legislative issue the Senate will consider is more important than this
one. I know this is a broad statement. But the economic future of the
United States rests entirely with this amendment. The future of the
United States, the well-being of our children, grandchildren and
children yet unborn rests entirely of whether we pass this amendment or
not.
Mr. President, if we fail to enact this amendment, this country is
headed irrevocably toward an economic calamity. Our national debt will
soon consume us. We are taking the same path as Mexico, but unlike
Mexico, there will be no one that can bail us out.
Mr. President, I have heard a lot of talk on the Senate floor about
how we have to find a lot of cuts in order to balance the budget.
Senator Daschle had a right-to-know amendment that we defeated
yesterday. He wanted to know where the spending cuts will be made over
the next 7 years.
But the most important thing that we can do is declare that we will
balance the budget, show the fortitude to balance the budget, and then
once we are bound by the Constitution, we will find a way to keep the
budget in balance.
This brings me to the point I want to make and the point of the
speech. It will only take 50 votes plus 1 in this Senate to raise
taxes. Any Senator that cannot bring it upon himself to vote for cuts
can stand up and vote for a tax increase. Any Senator that wants to go
back to his constituents and tell them that he is raising their taxes
by another 15 percent or more, taking another 15 percent or more out of
the gross profits of the small businesses that are struggling already
to keep buckle and tongue together, any Senator that wants this extra
money to pay for more foreign aid, more welfare, a bigger Department of
HUD, and more farm subsidies, he can do that. All he has to do is vote
for a tax increase. He can go back to his constituents and tell them
that he voted for a tax increase because he thinks these things are
more important than the taxpayers keeping more of their own money.
Senators are saying that we cannot deny money to the helpless in our
society. I say that the most helpless in our society are our
grandchildren, our children, and the progeny not yet born, upon whom we
are placing an enormous debt. If our generation wants greater
Government, more giveaways, then it is the duty of this Congress to
step up to the plate and pay for it now, to face the voters and say: I
increased your taxes because I am for more giveaway programs and more
spending.
I am tired of those that say they may not vote for the constitutional
amendment because they do not know where the cuts will come from. If
they have the courage, they simply can vote a tax increase and there
will not have to be any cuts. For me personally, I will not be telling
anyone in North Carolina that I need 15 percent more of their income to
pay for more Government. I do not think we need more foreign aid, more
welfare, more money for HUD, or more money for farm subsidies. In fact,
what I can tell them is if we simply stop spending more money each
year,
[[Page S2388]] we would have a balanced budget, with no cuts.
When I ran for the Senate, I said I would not vote for a tax
increase. I have not, nor will I ever. The Federal Government needs to
change its spending habits, not impose a burden of higher taxes upon
the working people and taxpayers of this country. If we froze Federal
spending to the levels that are in the fiscal year 1994 budget, we
would not only have a balanced budget in 1997, but we would have a
surplus of $10 billion. Instead, we just pour more money into more
giveaway programs, with no end in sight.
Mr. President, the message the American people sent to us on November
8 was that they want less Government, not more; less regulations, not
more; and more freedom to earn a living and generate a profit and spend
their own money. I ran on that message in 1992, and I have not changed
to this day.
Mr. President, finally, let me talk about the national debt that is
consuming us. It took this country nearly 200 years--from its founding
until 1983--to accumulate a national debt of $1 trillion. But since
then, in just the last 12 years, we have added $2 trillion more to our
debt. Today, our national debt stands at $3.6 trillion.
Under the 1996 budget that the President just released, our national
debt will grow to $4.8 trillion by the year 2000. In other words, in
just 4 years, our national debt will grow by another trillion dollars.
Every person who has ever gone into debt knows that interest is a
piranha and it will eat you alive. The same thing is happening to the
U.S. Government today. Interest is starting to destroy the Federal
budget.
Mr. President, all of this is taking its toll on our economy and the
ability of the U.S. Government to function. In the 1996 budget, 16
cents of every tax dollar will be spent just to pay the interest on the
debt. But to put it in real and, I think, more impressive terms, when
taxpayers file their income tax returns this year, they should know
that 41 percent--41 percent--of all the income taxes that they send to
Washington will be used for the sole purpose of paying interest on the
money we have already borrowed. In other words, 41 percent of all the
individual income taxes collected this year will go to pay interest on
the debt.
By the year 2000, our national debt will be equal to 52 percent of
the gross national product. In 1980, the figure was exactly half that.
In 1996, for the first time, we will spend more on interest on our debt
than we will on our military. And we are supposed to be the preeminent
military power in the world, and should remain so.
Not only is our debt burden hurting us at home, but it is hurting us
abroad. The dollar has fallen against every major currency of the
industrialized nations of the world.
Mr. President, some might ask, how did we get ourselves into this
mess? We got into this condition not because the working people are
taxed too little, but because the Congress spends too much. In 1996,
Americans will send $1.4 trillion to the Federal Government.
Regrettably, this is not enough for Congress. There is never enough.
If we could just control Federal spending, we might not have to
consider this amendment. But for 35 years, this Congress has been
unable to muster the fortitude to control Federal spending. It is
amazing to think that just since 1982, the Federal budget has doubled.
Are we, as a country, better off today than we were in 1982 because we
have doubled Federal spending? The answer is simple: We are deeper in
debt and have little to show for it, but the interest will be with us
to infinity.
Mr. President, we know what the problem is. The question is, what are
we going to do about it? The answer is that we must pass the balanced
budget amendment. We need to leave our children a clean balance sheet,
not a lifetime of debt, excessive taxes and a contingent liability of
$7 trillion.
Mr. President, in speaking of the national debt, and its impact upon
us, I ask your indulgence to tell a very quick story from my early
business career.
As a 21-year-old man, I was trying to buy some new trucks and
equipment, and the banker would not consider the loan unless my mother
endorsed the paper. Well, she was a very, very stingy Scottish lady and
looked things over well before she signed them. This had gone on for a
couple of weeks, and I went in the house for lunch one day and I asked
her to talk about it. She had the liability and the debt service
written on a handkerchief, and the proposed income that I said I was
going to make on the same handkerchief on the other side, just a ledger
sheet of income and debt service. And she asked me if her figures were
right,
and I told her they were. She picked it up, handed it to me and said,
``Go and wash it.'' When I stuck it under the spigot and the water hit
it, I saw what she had done. She had placed my debt, and had written
that in indelible ink. She had written my income in fruit dye. Her
words were--and I will never forget them, and the country needs to
remember them, too--``When you make a debt, it will be with you always
until you pay it, plus interest. Your income can go in a flash.''

Mr. President, I yield the floor and the rest of my time.
Mrs. FEINSTEIN addressed the Chair.
The PRESIDING OFFICER. The Senator from California.
Mrs. FEINSTEIN. Mr. President, I made my comments this morning on the
Reid amendment. I very strongly support it and I pointed out my
rationale for so doing.
Since then, we have been reading the committee report, Mr. President,
and something has come to my attention. In the spirit of debate and
discussion which was so prevalent on the floor between the Senator from
Pennsylvania and the distinguished ranking member of the Appropriations
Committee, I would like to continue that spirit, and if the bill
manager, the Senator from Pennsylvania, would be prepared to answer a
question on the majority report, I would appreciate it very much.
In this report, on page 19, it is pointed out that some programs are
exempted from this resolution and some are not. Now, this is news to
me, because, as a member of the Judiciary Committee that considered
this, that was not the case.
I would like to read the exact language. It reads:

Among the Federal programs that would not be covered by
S.J. Res. 1 is the electric power program of the Tennessee
Valley Authority. Since 1959, the financing of that program
has been the sole responsibility of its own electric
ratepayers--not the U.S. Treasury and the Nation's taxpayers.
Consequently, the receipts and outlays of that program are
not part of the problem S.J. Res. 1 is directed at solving.

Now, this is very strange to me. Social Security is put on budget and
its receipts and outlays are subject to Senate Joint Resolution 1, but
we suddenly find that the Tennessee Valley Authority is not. And not
only is it not, but the words prefacing the statement say ``Among the
Federal programs that would not be covered by Senate Joint Resolution 1
* * *''
My question to the distinguished Senator from Pennsylvania is: A, are
you aware of this, that the TVA is being exempted; and, B, what other
programs are being exempted from Senate Joint Resolution 1?
Mr. SANTORUM. I am trying to find the page which the Senator is
citing.
Mrs. FEINSTEIN. Page 19 of the committee report, about two-thirds of
the way down the page. It says ``Total outlays,'' and then the second
paragraph there, which begins ``Among the Federal programs that would
not be covered by Senate Joint Resolution 1 * * *''
Mr. CRAIG. Will the Senator from California yield?
Mrs. FEINSTEIN. I certainly will.
Mr. CRAIG. Mr. President, I am glad the Senator found and brought
that issue up, because it is critical only in the context of
understanding how it fits. I say that as an individual who helped craft
this amendment and believes in the logic and in the appropriateness of
the words ``Everything that is in the general fund budget is on the
table,'' and everything that the general fund budget and the Senate or
the Congress of the United States have authority over in decisionmaking
for the purposes of appropriations, allocation of resources, or the
establishment of funding levels is on the table.
The Tennessee Valley Authority, like other PMA's, or power management
Authorities, are not on the Federal budget. They have a Federal
obligation
[[Page S2389]] and that is to return revenue to the Government for the
money that was used to finance them.
But the Federal Government does not establish their budgets, nor does
the Congress of the United States. And that is what is directed in this
program.
So it is not a loophole. Everything that is in the budget is on the
table. This is a revenue source. It is the board of this particular
PMA, or power management authority, that establishes their own budgets
and they look at their obligation to the Federal Government as a debt
payment obligation. They are not a part of general fund budgeting, nor
can they either be called off budget, because they are a quasi-
independent Federal agency non-tied to the general fund budget.
Mrs. FEINSTEIN. Senator, this is exactly my point, because in 1990,
this body took Social Security off budget by a vote of 98 to 2. Social
Security draws its revenues from its own specific FICA tax, not from
the income tax or any other tax of Government.
Mr. CRAIG. Will the Senator yield?
Mrs. FEINSTEIN. I certainly will.
Mr. CRAIG. I agree the Congress did that. But you and I both know
that the Congress of the United States every year includes in the final
budget of this country and the budget that you and I will decide in the
coming months Social Security expenditures. We are allowed by the law
and the Social Security law to make decisions on Social Security. The
term ``off budget'' for Social Security is an accounting terminology
that separates it from the general fund budget or, if you will, the
all-inclusive Federal budget that we have been operating on since the
Johnson years.
The power authority is not something on whose budget we decide. That
is decided by a separate board. It is only the amount of obligation of
payment that power authority is tied to.
So if I may politely say, you cannot compare an apple to an orange.
And in this example, that is exactly what I believe you are attempting
to do. They are uniquely different entities under the law and under the
budget process of our Government.
Mr. SIMON. Will my colleague yield?
Mrs. FEINSTEIN. I certainly will.
Mr. SIMON. I thank the Senator.
If I may make another comparison. It is like Fannie Mae or Sallie
Mae. They are entities created by the Federal Government. Their boards
are appointed by the President of the United States. But if Fannie Mae
gets into some difficulty, they have to raise their own revenue. We are
not going to come along and help them.
I do not want Social Security to be in that situation. I want us to
feel an obligation to make sure that we fund Social Security.
So I think we are not just talking about something that is off budget
where we have an obligation. In this case, we are talking about
something that is a Federal Government-created entity, but they have to
take care of their own revenue. And if they run into some financial
difficulties, they have to raise power rates or, in the case of Fannie
Mae, may have to raise interest rates or something else. But we are not
going to come along and bail them out.
Mr. REID. Will the Senator from California allow the Senator to ask a
question?
Mrs. FEINSTEIN. I certainly will.
Mr. REID. I would be interested if the Senator from California could
answer a question based on what the Senator from Illinois said.
Why, then, was not Sallie Mae and Fannie Mae excluded? Why is it only
the Tennessee Valley Authority?
Mrs. FEINSTEIN. Mr. President, this has piqued my curiosity as to
what is excluded because, if we just follow the logic of the
distinguished Senator from Illinois, I stretched my memory back to see
if there was a time when the Federal Government ever bailed out Social
Security. I do not believe there was. There were times when the Federal
Government, the Congress, has raised the FICA tax, but the FICA tax is
a compulsory dedicated tax that goes for retirements.
I find it somewhat interesting that some programs--and it does refer
to quasigovernmental programs in this as well--some programs are
exempted under this bill and others are not.
Of course, the program which is most important to the American people
is Social Security. It is not exempted. It is not exempted because
there will be 3 trillion dollars' worth of surplus revenues that are
going to be taken from Social Security and used to balance the budget.
That is what Senator Reid and I do not think is right. I would just
like very much to obtain a full list from the committee and from the
authors of this as to precisely which programs are being exempted from
the balanced budget amendment.
Mr. CRAIG. Will the Senator yield?
Mrs. FEINSTEIN. I will yield.
Mr. CRAIG. Mr. President, no program of the Federal Government is
being exempted. These are not Federal programs. These are independent
entities that are known as quasigovernmental because it took a Federal
act to create them. They are not on budget. They have never been on
budget. This is the same report language that was filed a year ago and
3 years ago as we worked this very issue.
So I appreciate your concern because I, too, strongly believe exactly
the way the Senator from California believes--that the trust fund of
the Social Security system should never be used to balance the budget.
I have one of these entities in my area known as the Bonneville Power
Administration. We do not establish their budget here. You have never
voted on it. Neither have I. They are a Federal power-marketing agency.
They establish their budget just exactly the way the Senator from
Illinois said--by rates, and by rate increases if they need to increase
their budgets. They have but one obligation to the Senate and to the
Government of our country, and that is to return a revenue, based on
their debt obligation.
That becomes part of this revenue flow that becomes part of the
budget. That is not even like Social Security. Social Security does not
return a revenue to the Government following an expenditure. It is a
tax flowing in to service the obligations of Social Security and Social
Security recipients.
The Tennessee Valley Authority does not flow money to the Government
for purposes of obligation other than debt structure, and they are not
a part of the unified Federal budget. Simply are not and never have
been.
Mrs. FEINSTEIN. Mr. President, let me make this point, if I may,
because the Senator from Idaho has just said these are not Federal
programs.
The majority report says these are Federal programs. The majority
report says: ``Among the Federal programs that would not be covered by
S.J. Res. 1 is the Electric Power Program of the TVA.'' Now you are
saying it is not only TVA, it is Bonneville as well.
Now, maybe to some the argument can be made that there is no Federal
responsibility for these. But if something happened with these
programs, I think we would bail them out very rapidly. I do not accept
the argument that they are not Federal programs, and the majority
report does not accept that argument.
I yield to the Senator from Nevada.
Mr. REID. Mr. President, I appreciate the Senator yielding for a
question.
Mr. President, if the Senator from California would look at page 19,
the paragraph that begins ``Total outlays,'' right above where the
Senator has been reading, it stands on its head what my friend from
Idaho said.
Listen: ``Total outlays is intended to include all disbursements from
the Treasury of the United States''--listen to this--``either directly
or indirectly through Federal or''--listen to this--``quasi-Federal
agencies created under the authority of the acts of Congress and either
on budget or off budget.''
So that, I say respectfully to my friend from Idaho through my friend
from California, that is directly opposite what he said. Is that not
what the English language says?
Mrs. FEINSTEIN. That is exactly right, Mr. President. Something is
wrong. Something is fishy, I think. And I think we ought to find out
what it is, because what is sauce for the goose is sauce for the
gander.
I am happy to yield to the Senator from Illinois.
Mr. SIMON. Mr. President, let me just say if we were to rephrase
this, I would say the first paragraph we are talking about ``among the
federally created programs'' would have language that is more clear.
[[Page S2390]] If my colleague from California wants to vote against
the report for that reason, that is fine but just vote for the
constitutional amendment.
Let me respond to my friend from Nevada, because the paragraph that
he quotes is correct.
The REA serves people in Nevada, California, Idaho, and Illinois. We
do permit Government-backed bonds.
Now, when we put out those REA bonds we put a little bit into the
Treasury. Whatever CBO determines is a risk factor, that is put there.
Now, when my colleague from California says, well, if Bonneville went
down the tube, we probably would rescue then, I think that is correct.
I would just remind the Senator that we also rescued Lockheed. We also
rescued Chrysler. We will not put any more in here from Michigan for
Chrysler or Ford or General Motors, but we do put whatever risk factor
we have to when there are federally backed bonds.
Mrs. FEINSTEIN. I am happy to yield to the Senator.
Mr. CRAIG. Mr. President, thank you.
We can play semantics with the report language if you wish and we can
ask a variety of questions of the report language. I do not dispute the
legitimacy of asking the questions.
The report language is not the amendment. What is in the amendment
and which is key, and I think the Senator in searching for the
Government programs that would meet the definition, needs to look at
section 1 of the amendment.
It says ``Total outlays for any fiscal year.'' That is the operative
word, Senator. Now, the Senator used the example if my power authority,
Bonneville, got in trouble, would we bail them out. I do not know. We
would have to decide that at the time. That would become an outlay at
that moment in time.
We would have to fit that into the context of a balanced budget
because we would decide collectively that maybe it was necessary to do
it--it was going to damage the region. Your State of California buys a
lot of power out of the Bonneville power grid. If the Bonneville power
grid was going down, we might become allies. We would want to save it
so that my State would not go dark and your State would not go dark.
But the point is, does it become an outlay? That is all you and I for
the purpose of a balanced budget amendment have a responsibility for.
It is at this time not an outlay. TVA does not come to the Federal
budget. It is not an outlay of the Federal budget. If it got in
trouble--and I think your analogy is fair, as the Senator from Illinois
mentioned the analogy of Chrysler and the New York City bailout. New
York City is not an outlay today and should never appear on the budget,
should not be considered.
But if New York came, like they did years ago and said, ``We are near
bankruptcy. Help us,'' they become an outlay. They become a part of the
unified budgets of the Federal Government, and it is at that time that
we would have to make a decision.
So, whether the report language is right or wrong, the ultimate test
and a legitimate question to ask, I sincerely believe, is what segments
of the Federal Government manifest an outlay to the unified budget of
the Federal Government? While we took Social Security off budget and
away from the unified budget, which is merely an accounting word for
total expenditure, total receipts, in the end we bring it back. We
bring it back and we put it in to the total budget of the Federal
Government, and you and I vote annually on the expenditures of Social
Security.
We do not on TVA, we do not on Bonneville Power, we do not in this
operative section--not operative, but descriptive section. Report
language is never operative. It is only descriptive. It expresses
general intent. It is only at that point that I think your concern
deserves an answer, and I would like to try to put a list together for
you.
But if you are basing it on your reason to vote because it is off,
the test is: Does it manifest by its presence an outlay to the unified
budget of the Federal Government? And the very simple answer to that is
no, it does not.
I thank the Senator from California for yielding.
Mrs. FEINSTEIN. Mr. President, I appreciate that and I thank the
Senator. It is just that I think I find a conflict in this because,
after all, Social Security, although there is an outlay every year, is
running well in surplus. By the year 2002 when this is operative, there
will be $705 billion plus another $300 billion, it is my understanding,
becoming available for retirements. But because they are not needed,
this amendment would automatically use those revenues to balance the
budget. That is my problem with this.
The fact that--let us say it is Federal or quasi-Federal--this is
still an entity that is the product of the Federal Government whose
full faith and credit at one point built it, et cetera, and whose full
faith and credit would sustain it if it fell into tough years.
I look at Social Security as important as TVA, it is as important as
Bonneville if you are a senior who is depending on it or a working
person who is paying the FICA taxes with the expectation that the
Government is going to make those revenues available. This amendment
does not make those revenues available for retirements.
So all we are saying is, just as you have excepted Bonneville, TVA,
and some other things yet unknown to some of us, we say exempt Social
Security, and then we can all march forward together.
Mr. CRAIG. If the Senator will yield.
Mrs. FEINSTEIN. I yield the floor, and I thank the Senator very much.
Mr. CRAIG addressed the Chair.
The PRESIDING OFFICER. The Senator from Idaho.
Mr. CRAIG. Mr. President, only briefly to respond to the Senator from
California. She and I are clearly on the same wave length. We do not
want to see the trust funds and the revenues that build up to support
future generations Social Security checks used to balance the budget.
The tragedy is today they are. Today the surpluses are spent through
the general fund and notes are deposited in the trust funds, interest
bearing notes. This is a requirement of the law, the law that created
Social Security. That is what goes on today.
So the Social Security stability, while there are revenues coming in
in the form of taxes, has always been based on the willingness of the
Congress of the United States, the Senator from California and the
Senator from Idaho for assuring its stability because we, by voting
every year to pass a unified Federal budget, vote on the expenditure of
moneys from the trust fund to things other than Social Security because
the money is borrowed from the trust fund and expended out through the
general fund. That is part of the financing of our Government, whether
you and I disagree with that or not.
It is not a separate pool of money setting to the side bearing
interest. It is working money and, of course, it comes in the form of
Treasury notes and interest bearing at the time. That is how it works.
I think that is a reasonably good description of how it works and
certainly one that will not change.
I think the argument that all of us have had is, if you are going to
balance the budget, you look at all of the Federal budget, all of it
that is currently inside the unified Federal budget and in the
calculations that we make on an annual basis from a budgetary point of
view.
While the Senator from California has expressed her concerns here,
let me close this thought by simply saying, what is now not currently
on budget or a requirement that the Senator from California or the
Senator from Idaho deal with it at all, unless it got in trouble, as
she makes out, that would be then the point that we would be
responsible for it, and it would fit under the definition and the clear
examination of article I which says, ``total outlays.'' There is the
key, total outlays for any fiscal year. Right now TVA is not an outlay
nor are those other entities.
Mr. President, one other item that I thought was interesting this
afternoon in the debate and the discussion as it relates to the Senator
from West Virginia when he was breaking out different portions of the
budget and he was dealing with sections that talked about revenues and
how we would handle them, it was interesting to me that he was only
willing to deal with pieces and not the whole.
It is most unfair, in my opinion, to examine the amendment in pieces
and
[[Page S2391]] say, and, therefore, that piece is operative
exclusively under a certain manner. Let me give an example of what I
think I am concerned about when he said, ``The limit on debt of the
United States held by the public shall not be increased, unless three-
fifths'' vote. He talked about revenues and the ability to evaluate
those and, again, it was an operative factor of three-fifths vote.
We understand that the art of projecting revenue in a gross domestic
product as large as the United States is not a perfect art, and while
our very best minds at the Office of Management and Budget, or the
Congressional Budget Office, or Treasury might come up with a fixed
revenue for the year over which we budget, it would not be
unreasonable, based on cyclical patterns, for that revenue to be off by
$10, $12, $14, or $20 billion.
The Senator from West Virginia is absolutely right. We are never
accurate to within the cent or the dollar or even the hundreds of
millions of dollars.
But what it then says is that, by a three-fifths vote, other things
are allowed to happen and that remains the key operative. What the
process does is that it causes us for the first time to try to live
within the revenue projection. And certainly the Senator from West
Virginia, who for years has been chairman of the Appropriations
Committee, knows that this Congress and probably few that he has ever
been involved in ever consciously created a budget to live within the
revenue projections. It was always take that revenue and borrow a heck
of a lot more.
Now what we are saying is that as we work over the next 7 years to
bring this budget into balance, from that point forward we will live
within the best guesstimates possible by the professionals, and we will
project spending levels on an annualized basis on those projections, on
those averages, on those summaries. And if we miss them, then through
the implementing language and a new budget process that would be
created growing out of this, we would deal with them.
Would it be to lift the debt ceiling by three-fifths vote and move
them into debt? Yes, that could be done. That would then clear out the
budget for the year.
Would it be to raise revenue to offset it? Yes, that could be done.
Would it be possible to spin it into the next fiscal year as a debt
to be paid immediately because of a projected surplus in the next year?
Yes, that, too, could be done.
This amendment does not restrict those kinds of actions. What it does
say and what is important to say is you look at the total of the
argument, read the whole amendment, do not examine the pieces. Put it
all together, make it a whole body, make it a whole document because
that is how we will all have to look at it and that is how we will have
to operate as a Congress under the 28th amendment to the Constitution,
the one that we are now debating. We will not operate exclusively by
the pieces or the parts. It will be a whole document that will cause us
to react that will create the implementing language which will be
probably a new Budget Act and a new process.
What it does disallow, and that is, of course, where this Congress
has found itself in real trouble over the years, it disallows the
ability to micromanage in a way that has created the kind of debt
structure that we have. It simply puts us within parameters, very
strict parameters, and it gives, I think, the American people for the
first time a sense of confidence that we actually are trying to stay
within our limits and balance the Federal budget.
I would like to try to do that. I think most Americans want us to do
that. I am privileged to be serving my 15th year in the U.S. Congress,
and never in those 15 years has this Congress consciously tried to live
within its revenue or live within a balanced budget. It always figures
we will take what we can get and we will borrow the rest to meet our
political desires and not our fiscal responsibility.
Mr. SANTORUM addressed the Chair.
The PRESIDING OFFICER. The Senator from Pennsylvania.
Mr. REID. I would ask my friend to yield, if I could talk to either
Senator Santorum or Senator Craig, whoever is managing the bill now?
Mr. SANTORUM. Is the Senator asking me to yield?
Mr. REID. Yes.
Mr. SANTORUM. I ask unanimous consent that I may yield to the Senator
from Nevada.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. REID. It is late in the day, and I am wondering if at least for
the next hour or so we could get some idea if we have some speakers. I
have someone who is tentatively scheduled to come at 5 o'clock, the
Senator from Alabama. It is just so people are not necessarily waiting
around. I see the Senator from Michigan is here.
Mr. SANTORUM. I do not think we have anyone lined up at this point to
speak. I was going to speak for about 5 minutes and then I am going to
sit.
Mr. REID. I thank the Senator.
Mr. SANTORUM. Mr. President, I wanted to finish up what little
colloquy and discussion we had just a short while ago with the
distinguished Senator from West Virginia. I wanted to continue that
debate, but in deference to my colleague from North Carolina, I allowed
him to make his presentation. But there was a couple of things I just
wanted to bring closure to before we move on to the next round.
The point the Senator from West Virginia was alluding to was section
1 of the bill:

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

It is unenforceable, unworkable; these estimates will throw you all
off; the estimates do not work; they are not reliable. And as a result
this is an unenforceable constitutional amendment that is going to
cause all sorts of unconstitutional activities in this Chamber.
I mentioned to him that we must look down to the next section,
section 2, which states:

The limit on the debt of the United States held by the
public shall not be increased, unless three-fifths of the
whole number of each House shall provide by law for an
increase, for such an increase by rollcall vote.

There is the enforcement; that once we get to the balanced budget, or
once we get to where the debt limit is, that we cannot increase that
debt limit without a three-fifths vote. That means we cannot incur a
debt or a deficit from any year because if we incur a debt and do not
raise the debt limit, then we cannot issue obligations to pay for that
deficit, which means that would be in a sense a default of certain
obligations.
Now, that is the enforcement. That is the mechanism that drives
section 1, that makes us get better estimates.
I believe, as I am sure the Senator from West Virginia believes, that
we will get better estimates and they will be more ongoing, they will
not be every 6 months but will be on a more frequent basis so we can
calculate what the correct number will be at the end of the fiscal year
so we can hit pretty close to zero and hopefully hit a surplus.
That is the enforcement. That is what makes all of this discussion
about estimates, frankly, irrelevant to the enforcement of this act
because the enforcement is the debt limit provision. That is what
forces us to come in with a balanced budget, irrespective of what the
estimates say.
The response then was, well, you are creating a minority veto; that
the minority is going to have all this power because it is going to be
a supermajority that is going to be required to raise the debt limit.
I would just suggest I have the distinct feeling that we are here
because we have a minority veto, that we have been talking about this
bill for 2 weeks because of a minority veto; that we will be filing a
cloture motion soon and we will find out whether there is a minority
veto.
This place runs on minority veto. The minority veto is the hallmark--
as the Senator from West Virginia said during his discussion, things
come over here to cool down a little bit, to cool down.
I saw a movie the other day, ``Encino Man,'' not exactly the greatest
movie that was ever made, but Encino Man was about a Cro-Magnon man and
his spouse who were hit by an avalanche. Now, that is cool down. And
they were encased in ice. And the Encino Man as a result of an
earthquake was uncovered, and the ice block that he was encapsulated in
thawed, and he came to life.
[[Page S2392]] My concern is that in this body we are getting
avalanched to the point where we are going to be encapsulated in ice
and not be able to act and do anything on this balanced budget
amendment, and when we wake up it will not be as happy a world as what
the Encino Man faced. When we wake up, we may have desperation,
despair, and economic collapse in this country because we simply chose
to cool things off.
We cannot afford to cool things off any more. The more we cool things
off here, the hotter it gets out there. We have an obligation to act.
Do not talk about minority vetoes. We have seen plenty of that around
here on this issue. And I suspect the Senator from West Virginia likes
that fact, of having that minority veto. As the Senator from Kansas,
Mrs. Kassebaum, said, maybe it is a bad idea whose time has come, but
it is a necessary evil that we have to put on to this country to get
our financial act in order for the next generation of Americans.
I do not want to be the first generation of American leaders to leave
the next generation worse off than we are and worse off than my
grandparents were, and that is what we are standing on the precipice of
if we do not act today.
I am hopeful we will. I am confident we will. I do trust the better
angels of our nature in this place. I know there is a lot of activity
going on that is trying to cloud this issue, but I fundamentally
believe that people in this Chamber will do the right thing when called
upon and they will stand up for the future of this country.
I yield the floor.
Mr. BENNETT addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah.
Mr. BENNETT. Mr. President, I ask unanimous consent that I be allowed
to proceed as if in morning business for no more than 10 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.

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