[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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