[Congressional Record Volume 141, Number 35 (Friday, February 24, 1995)]
[Senate]
[Pages S3108-S3131]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                      UNANIMOUS CONSENT AGREEMENT

  Mr. THURMOND. Mr. President, before the Senator from Florida speaks, 
I ask unanimous consent that I be recognized to speak following the 
remarks of 
[[Page S3109]]  the Senator from California, Senator Feinstein.
  The PRESIDING OFFICER (Mr. Craig). Without objection, it is so 
ordered.
  The Senator from Florida.
  Mr. MACK. Mr. President, I have listened to the debate on the issue 
of the balanced budget amendment now for several hours today and, 
frankly, off and on for the last several weeks. Many of my colleagues 
have done an excellent job of providing expert opinion as to why a 
balanced budget amendment should be passed, or why it should be 
defeated. Those experts include economists, constitutional scholars, 
and past great legislators. But the remarks that I am going to make 
today are not based on experts. They are going to be based on my own 
personal observations. They will be based on my own convictions and on 
some of my own readings.
  There is a very interesting set of books entitled ``The Debate on the 
Constitution.'' I was really stunned when I read through this series of 
documents and speeches and learned of the fear people had of the 
Constitution. That document put forward for their ratification 
terrified many of the citizens of our Nation at that time. It terrified 
them that a great, new central government was going to grow up in their 
midst, and that this great, new government would, in fact, either 
destroy or limit their individual rights. I cannot help but draw the 
conclusion, after those readings--and observing from my own personal 
experiences in the 12 years that I have served in the Congress--6 years 
in the House and 6 years in the Senate--that we have today developed a 
Government that, in essence, is out of control.
  My own personal reason for becoming involved in politics originated 
after spending 16 years in the banking business. Prior to that time I 
had no idea whatsoever that I would end up in politics as a Member of 
Congress and then of the U.S. Senate. I entered politics because I 
became so frustrated and so angry with what the Government was doing to 
the banking business--the business in which I was involved. Virtually 
every single day I heard from the Comptroller of the Currency, the 
FDIC, the Federal Reserve, or the U.S. Treasury, about the things that 
I could do and could not do, as a banker. It even reached the point--I 
believe it was in 1979 or maybe 1980--when all bank presidents received 
a letter that specifically told them what kinds of loans they could 
make and what kinds of loans they could not make.
  To show you the degree to which this Government control extended 
itself, this letter provided that banks could lend money for home 
improvements if the home improvement was going to be the addition of a 
needed room; but it did not for the addition of a swimming pool. That 
is the extent that Government had intruded into the operations of 
private business in America in the late 1970s and early 1980s. So, 
again, I am reflecting on my own personal conviction that there must be 
a restraint on Government, and that is what this debate is about.
  I think the message of the 1994 election was pretty clear. Even 
though some Republicans have a tendency to see the election as being a 
mandate for Republicans, I would say that the mandate was a little bit 
more specific than that. It was a mandate to control Government. It was 
a mandate to follow a set of ideas of less taxing, less spending, less 
Government, and more freedom. I think it is important for us to think 
about that message of 1994 as not necessarily being a wave of 
Republicanism, but a wave of saying we want our lives back, our 
freedoms back, and we want Government off our backs. This is a 
fundamental debate. It is a debate between those who believe in more 
Government and those of us who believe in less Government.
  I have told the story of my first vote in the Congress many, many 
times throughout my stay here. I tell about this story because I want 
to make the point that there is more to this debate about a 
constitutional amendment to balance the budget than economics. The 
first vote that I cast as a Member of the House of Representatives in 
January of 1983 was a very big deal for me because I had never cast a 
vote in a legislative body before then. Politics and legislative bodies 
were all brand new to me. It was a very, very exciting moment, and I 
thought it was an important moment. As I look back, I realize that the 
issue we were debating that first day in the House back in 1983 was not 
an issue that was going to change the direction of the world; it was 
not going to have great significance on the country or, for that 
matter, great significance with respect to the House of 
Representatives. The question that was being posed that day was whether 
we should add a new committee to the Congress of the United States. I 
must say to you that I came here already with a preconceived idea that 
we had too many committees; that the staffs were, frankly, getting too 
large; that we were spending too much money on the legislative 
operations of Government, and that we did not need this committee. But 
because I was brand new, I thought maybe this question was not quite so 
simple and that I should check with some of my colleagues on both sides 
of the aisle to get a sense of what they were going to do.
  As I wandered around the floor, the message I got back was, ``Connie, 
we do not need another committee. We already have too many of them.'' 
In fact, they said to me, ``This is a select committee and they do not 
write legislation. They are really platforms for politicians to make 
public statements, and we are spending too much money. The committees 
are out of control, the staffs are getting too large. We do not need 
another committee in the House of Representatives.''
  So I went over and cast my first vote. In the House, they use a 
computerized card to record votes. I put my card in and pushed the 
``no'' button and I looked back over where the Speaker sits. 
Everybody's name is awash in lights across the back of the room. I 
looked up there thinking--after listening to my colleagues--that this 
board was going to be awash in red lights voting ``no.'' Well, out of 
435 Members of the House, I think about 34 of us voted against the 
addition of another committee.
  There are a couple of things I did not mention to you. First, the 
name of the committee was the Select Committee on Families and 
Children. The other thing I was told, as I wandered around the floor as 
that brand new freshman legislator filled with excitement and 
enthusiasm and idealism was, ``Connie, you do not vote against 
something called `families and children' and go back home and run for 
reelection.''
  Now, to me, that story says it all. It says if there is not some form 
of outside constraint on the ability of Members of the Congress to 
spend the taxpayers' dollars, we will end up with exactly what we are 
getting.
  Earlier today, I heard the distinguished Senator from Massachusetts 
say, basically, that we do not need this amendment; we can just go 
forward and do the things that we know we should be doing without this 
restraint--without this requirement in the Constitution.
  Well, in one of the books I was reading this past week I came across 
a statement that I think many of us have heard from time to time. I did 
not realize it was an old Chinese saying. But it said something to the 
effect: If you do the same thing over and over and over again reaching 
the same result and each time expect that there is going to be a 
different outcome, this is insanity.
  Again, I have made this comment to the people in the State of 
Florida, that it is insane for us to continue, year after year after 
year after year, to continue operating under the same process that has 
failed us. So it seems to me that logic dictates that we ought to be 
adjusting the process because it is only in changing this process that 
we will bring about change. And, as I said earlier, change is what the 
1994 election was all about.
  Interestingly, as I stand here both of my grandfathers come to mind. 
The desk I am standing over was handed over to me by Senator Phil Gramm 
in January 1989, was the desk that my grandfather, Morris Sheppard, sat 
at when he was in the U.S. Senate from 1912 to 1941. And, the baseball 
that I hold in my hand is a baseball that was signed by my grandfather, 
whose name so many people recognize, Connie Mack, who was born in 1862. 
He signed this baseball in 1929. Since then my father has signed it, I 
have signed it, and 
[[Page S3110]]  my son, who is now 27, just recently signed it last 
year.
  I thought about bringing this baseball to the floor of the U.S. 
Senate because I had the opportunity again during the debate on this 
amendment to observe the distinguished Senator from West Virginia refer 
to a contract that he had signed many, many years ago. What it brought 
to my mind is how our Nation has changed from one generation to the 
next; how different America is from the country that my grandfather was 
born into in 1862; and how different the Nation is compared to what it 
was like when my father was born and when I was born and when my son 
was born.
  I think about what this Nation is going to be like for my 
grandchildren, three of which I have at this moment, 10, 8, and 1\1/2\. 
I wonder what kind of future is in store for them if we do not make 
some significant changes in the way we do business.
  I looked back at some of the historical fiscal records of this 
country. In 1929, when my grandfather signed this ball, I looked up the 
level of Federal spending. Calculated in 1994 dollars Federal spending 
in 1929 was the equivalent of $29.9 billion. In 1941, Federal spending 
was $174 billion. In 1961, it was $520 billion. And in 1994 it was 
$1.46 trillion.
  Another point I should make is that, in 1929, the debt was about $480 
million--$480 million. By 1994, the national debt had reached $4.643 
trillion.
  If we keep this up, what kind of future will we leave our children? 
What will it mean to them?
  The previous speaker spoke very eloquently about what will happen to 
future generations because of what we have already done and how much 
worse it will be if we fail to do something to change the direction in 
which we are headed.
  It also struck me, as I listened to the discussion, how our country 
has changed from generation to generation and how much our country has 
changed from 1776 to 1862 to the present. If we fail to recognize that 
our society is one of change, I guess one could conclude that we should 
not change the Constitution.
  Both previous speakers used the term, ``moral obligation'' in 
reference to the Constitution suggesting that it is a moral document. I 
am suggesting that I think we ought to recognize our society has 
changed and continues to change. Unfortunately, we have moved away from 
a group of people who believed in the idea of personal responsibility 
to those who have fostered an entitlement mentality today.
  I would suggest that what we have done for the last 25 years is a 
reflection of who we are; that somehow or another we think we can live 
generation to generation passing on huge amounts of debt with no 
consequences. And I think everyone understands that that is just 
fundamentally wrong.
  Again, there are those who are going to say to us, ``We don't need 
this constitutional amendment to do what is right.'' I would make the 
argument that after having served these last 12 years and being 
involved on the House side in helping to pass the Gramm-Rudman 
legislation, we do not have the resolve to impose limitations on 
ourselves. As you may recall Gramm-Rudman was a statute, an attempt to 
control spending which the Congress merely changed when it became too 
difficult to get the job done.
  So the conclusion that I have come to is that the only way to 
effectively control what the Congress does with respect to spending the 
taxpayers' money is to put an outside restraint on them. Without this 
restraint we risk losing those personal freedoms that have made this 
country great.
  Oh, I know, today there will be people who will say, ``Aren't you 
going a little overboard to suggest that our Nation and our individual 
freedoms might be at risk because of our decision to continue to 
overspend and to run deficits?''
  I do not think so at all.
  What we are involved in--we have heard the term many times --is an 
experiment in self-government. We are involved in an experiment in 
democracy.
  We need to understand that this is a continual experiment in 
democracy. Ours is a constantly changing nation, a nation whose values 
and whose morals have been changing. If we do not address and adapt to 
that change, then we are putting the next generation at risk.
  I think that when we come down to the final vote, we are going to 
have the necessary votes to pass this constitutional amendment. And 
when we look back, I think that we will find the turning point was when 
President Clinton submitted his budget for fiscal year 1996.
  I am not going to put this in a partisan perspective, because I 
recognize the claim can be made that Presidents Bush and Reagan did 
exactly the same thing in submitting budgets which failed to address 
our debt problem. But, what is different about this debate is that the 
country finally recognized that a constitutional amendment had to be 
passed, that it was an absolute requirement which we as a nation, as a 
society, and as a Congress had to put in place a series of budget 
decisions to get us to a balanced budget.
  My hometown newspaper referred to the President's budget proposal by 
saying: ``Clinton to GOP: You Cut the Budget.'' It went on to say, 
``Republicans Ready and Willing.''
  I think that those who had been arguing all along that we can balance 
the budget without a constitutional restraint saw in the 
administration's budget proposal that this was simply not the case. 
They recognized that we were going to get the same old thing, over and 
over again. If we wanted the status quo, then we got it in the budget 
that was presented to the Congress by President Clinton.
  I want to refer, also, to a chart that I have used in the past. Many 
may remember this book, entitled ``Bankruptcy 1995.'' There is a very 
interesting chart in it referred to as the ``Hockey Stick Chart'' 
because it plotted the total debt over a period of time from 1970 to 
the year 2000. It illustrated that at some point the total debt just 
goes straight up, absolutely out of control.
  I remember when I read this book, it started off with a series of 
examples of what would happen when a country's debt gets out of 
control, and the choices that would face a society, such as monetizing 
the debt. What really has come back to my mind is the story that was 
told as to what happened in some of the Latin American countries in the 
past, and what they said would happen to the United States. The message 
was: ``If you fail to get control of your spending and your deficits 
and your debt in America, the same thing could happen to you.''
  I remember reading through this. It was fairly dramatic. Think about 
what it would be like if you woke up in the morning to talk with your 
mother and dad, who had received an emergency telephone call the night 
before from the place where they were working, telling them that it was 
no longer necessary for them to come in because there was no company 
left. The company went bankrupt because of certain things that happened 
as a result of monetizing the debt. Inflation skyrocketed to the point 
where the cost of the basic necessities of life--food, housing, health 
care--no longer could be afforded, because they went spiraling out of 
control as a result of uncontrolled debt.
  It is interesting how people react to this story. They think this 
could never happen in America. This is America. This is the Nation that 
led the world through World War I, and World War II. We defended 
freedom all over the world. We are looked upon as the beacon of hope 
and opportunity around the world. This could never happen in America.
  I guess the reason that I wanted to come back to this is because of 
what is happening in Mexico today. To draw the conclusion that the 
price that Mexico is paying for its economic disorder is not a price 
that we would have to pay for our economic disorder is fundamentally 
unsound. We are fooling ourselves if we think we can continue on this 
binge. We are fooling ourselves if we think we will solve the problem 
just by trying the same old process that has failed us year after year 
after year.
  Mr. President, I conclude my remarks by saying that this is a 
fundamental debate which is taking place here in the U.S. Senate. It is 
a debate about those who believe more government will solve our 
problem, and those 
[[Page S3111]]  who believe that less government, less taxing, and less 
spending, will give more freedom. I have concluded that freedom is the 
core of all human progress. It must be defended. The only way we can 
defend it economically is to put into place a constitutional amendment 
that requires a balanced budget.
  I yield the floor.
  The PRESIDING OFFICER. By a previous unanimous consent request, the 
Senator from California was to have time. She is absent from the floor. 
I now recognize by previous unanimous consent the Senator from South 
Carolina.
  Mr. FORD. Mr. President, will the Senator yield to me to ask a 
question?
  Mr. THURMOND. Mr. President, I will be pleased to yield.
  Mr. FORD. Is the unanimous consent for those who are able to speak 
the rest of the afternoon, or is this the last speaker under the 
unanimous-consent agreement?
  The PRESIDING OFFICER. This is the last person who is sequenced to 
speak.
  Mr. FORD. I will not make a request, but try to attempt to get the 
floor in my own recognition.
  I thank the Chair.
  Mr. THURMOND. Mr. President, I rise today to continue the debate on 
this historic opportunity to adopt House Joint Resolution 1, the 
balanced budget amendment.
  Over the past 3 weeks we have heard many eloquent speakers on the 
need to pass a balanced budget amendment and bring this Nation's fiscal 
policy under control. It has been especially encouraging to see our 
freshman colleagues take to the floor and urge this body to adopt a 
balanced budget amendment. Many of their campaigns were centered on the 
premise that the Federal Government has grown too large, spends too 
much money and must be curtailed to operate within its means.
  Mr. President, we have been considering this proposal for 26 days. 
There has been significant debate and compelling arguments on the need 
for a balanced budget amendment. I would just note that during our 
debate over the past 26 days, the Federal debt has grown over $21.5 
billion.
  Undoubtedly, it is the desire of every member who supports the 
balanced budget amendment to see the Federal budget deficit eliminated 
that we may begin to cut away at the Federal debt which currently 
stands at $4.8 trillion. Without a balanced budget amendment, there has 
been little pressure on the Congress to make tough legislative choices 
on Federal spending and the Federal deficit has continued to grow. With 
a balanced budget amendment as part of the Constitution, the Congress 
would be mandated to follow a sound fiscal policy. The Congress would 
finally understand the reality that there are a finite number of tax 
dollars available for public spending and various proposals would 
compete on merit and need, not popularity.
  The balanced budget amendment would instill an urgent need for 
legislative accountability as Congress considers various proposals for 
increased Federal spending. Currently, there is no real check on 
runaway Federal spending, and there will never be a shortage of 
legislation creating new Federal programs or efforts to increase 
spending in existing programs. Without a balanced budget amendment, 
budget deficits over the long term will continue to rise and the 
Federal debt will continue to grow. The Congress has not shown the 
fortitude to address, in a meaningful way, the budget deficit and the 
Federal debt. There have been times when legislative gestures were made 
to bring spending within our means but those efforts were short-lived. 
Statutes to reduce Federal spending have not been enough. They are too 
easily cast aside and the Congress rolls along on its path of fiscal 
irresponsibility.
  I am convinced that without the mandate of a balanced budget 
amendment, Federal spending will continue to eclipse receipts and the 
American people will continue to shoulder inordinate tax burdens to 
sustain an indefensible congressional appetite for spending. In 1950, 
an average American family with two children sent $1 out of every $50 
it earned to the Federal Government. Today, the average American family 
is sending $1 out of every $4 it earns to the Federal Government. Under 
current budget projections, there is no reason to believe that these 
statistics will improve.
  Mr. President, we can trace the debate on a balanced budget
   amendment back in our history for 200 years. A defining moment may 
well have been the appointment of Thomas Jefferson as Minister to 
France. Thomas Jefferson was abroad when the Constitution was written 
and he did not attend the constitutional convention. If Jefferson had 
been in attendance, it is quite possible that he would have been 
successful in having language placed in the Constitution to limit the 
spending authority of the Federal government. Upon studying the 
Constitution, Thomas Jefferson wrote in a letter of a change he so 
fervently believed should become part of the Constitution. He wrote the 
following and I quote,

       I wish it were possible to obtain a single amendment to our 
     Constitution. I would be willing to depend on that alone for 
     the reduction of the administration of our government to the 
     genuine principles of its Constitution. I mean an additional 
     article taking from the government the power of borrowing.

  Further, Jefferson stated and I quote, ``If there is one omission I 
fear in the document called the Constitution, it is that we did not 
restrict the power of government to borrow money.'' President Jefferson 
also stated, ``I place economy among the first and most important of 
republican virtues, and public debt as the greatest of the dangers to 
be feared.''
  President John Quincy Adams stated, ``Stewards of the pubic money 
should never suffer without urgent necessity to be transcended the 
maxim of keeping the expenditures of the year within the limits of its 
receipts.''
  --and incidentally, he was the only President ever born in South 
Carolina--
  Another former president Andrew Jackson stated the following:
       Once the budget is balanced and the debts paid off, our 
     population will be relieved from a considerable portion of 
     its present burdens and will find * * * additional means for 
     the display of individual enterprise. We should look at the 
     national debt, as just as it is, not as a national blessing 
     but as a heavy burden on the industry of the country to be 
     discharged without unnecessary delay.
  President Harrison described unnecessary public debt as ``criminal.''
  President Woodrow Wilson stated, ``Money being spent without new 
taxation and appropriation without accompanying taxation is as bad as 
taxation without representation.''
  President Calvin Coolidge stated the following:

       The Nation must make financial sacrifices accompanied by a 
     stern self denial in public expenditures until we have 
     conquered the disabilities of our public finance * * * we 
     must keep our budget balanced for each year.

  Mr. President, early American Presidents and public leaders 
understood the dangers of excessive public debt. For almost 150 years, 
balanced budgets or budget surpluses were the fiscal norm followed by 
the Federal Government. The unwritten rule followed by Presidents and 
legislators until recently in our Nation's history was to achieve 
balanced budgets except in wartime. But the role and the size of the 
Federal Government has gown out of control. In the past three decades, 
the Federal Government has run deficits in every year except one. 
Further, the Federal Government has run
 deficits in 56 of the last 64 years.

  Mr. President, during the 1960's, deficits were averaging around $6 
billion per year. The following decade, the 1970's, saw deficits rise 
and they averaged $36 billion per year. In the last decade, the 1980's, 
deficits continued to rise and averaged $156 billion per year. So far, 
in the 1990's, deficits have averaged $259 billion per year.
  The Federal debt has grown as deficits have continued to grow and the 
debt now stands at $4.8 trillion. It took this Nation over 200 years to 
run the first trillion dollar debt yet we have recently been adding 
another trillion dollars to our debt about every 5 years.
  I have been deeply concerned during my time in the Senate over the 
growth of the Federal Government. It has been too easy for the Congress 
to pass legislation creating new Federal programs and spending more tax 
dollars whenever there is a call for Federal intervention. Of course, 
the Federal Government has an appropriate role to protect 
[[Page S3112]]  the citizens of this Nation, but it is not realistic to 
believe that Washington should respond to every perceived problem with 
a new Federal approach. This Nation has drifted from its original 
foundations as a national government of limited authority. I believe 
the adoption of a balanced budget amendment will do much to return us 
to a more decentralized Federal Government of limited authority and the 
mandates of such an amendment will increase legislative accountability. 
A balanced budget amendment is the single most important addition we 
can propose to the Constitution to begin reducing the size of the 
Federal Government.
  Mr. President, we have seen the national debt and deficits rise 
because in large part, the Federal Government has grown. The first $100 
billion Federal budget in the history of the Nation occurred in 1962. 
This was almost 180 years after the Nation was founded. Yet, it took 
only 9 years, from 1962 to 1971, for the Federal budget to reach $200 
billion. Then, the Federal budget continued to skyrocket; $300 billion 
in 1975, $500 billion in 1979, $800 billion in 1983, and the first $1 
trillion budget in 1987. The budget for fiscal year 1995 was over $1.5 
trillion. Federal spending has gripped Congress as a narcotic but it is 
time to break the habit and restore order to the fiscal policy of this 
Nation.
  It is incumbent upon this body to send the balanced budget amendment 
to the American people for ratification. I am pleased that we have 
reached agreement to vote on final passage on February 28, next 
Tuesday. The vote on final passage on House Joint Resolution 1 could 
well be the most important vote we will face as Senators as its 
adoption is essential for protecting our liberties as a free nation. I 
hope we do not fail the American people on this historic opportunity 
and instead present to the States our proposed amendment to mandate 
balanced budgets. It is time to act to secure the future for all 
Americans.
  Mr. President, I just want to say in closing, what other way can we 
balance the budget? The Congress has not shown the fortitude, it has 
not shown the willingness and it has not balanced the budget. How can 
we make them do it? There is no way I know to make the Congress balance 
its budget except a constitutional amendment.
  We have tried all other ways. They have failed. The balanced budget 
amendment put in the Constitution will tell the Congress it cannot 
spend more than it takes in, and then we will get the budget balanced. 
Once we balance it, I hope we can keep it balanced. If we have this 
constitutional amendment, we will have to keep the budget balanced.
  I yield the floor.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. GRASSLEY. Mr. President, Members of this body will vote on 
Tuesday on the balanced budget amendment, and I am very thankful for 
that. There are increasing indications that Senators have, of course, 
learned from the last election last November, and that from their 
constituents who want this amendment now that the American people want 
a change from the past, because formerly this amendment was bottled up 
year after year in one House or the other.
  I hope it tells the people of our country that they can make a 
difference. They expressed in the last election that they wanted a 
difference, and I think it gives credibility to the election process 
when people who are elected understand why they were elected and want 
to carry out the mandate of that election.
  Year after year, this constitutional amendment was voted down in one 
House or the other, or both. Year after year, the budget deficit 
increased and our children and grandchildren have been left holding the 
bag, and the American people, I think, expressed in the last election 
they want that to stop.
  Many Members had concluded for many years that Americans would never 
want a balanced budget because of the cuts that might affect programs 
that they relied on, that they benefited from and in which they felt 
some security. But the American people, I believe, are less selfish 
than that.
  Every day we see new indications that Americans are willing to cut 
spending to balance the budget. For instance, it is becoming clearer 
that a balanced budget can be attained with less pain than some have 
suggested. Today, DRI-McGraw Hill, which has been called the world's 
leading nonpartisan economic analysis and forecasting firm, has 
concluded that the amendment will add credibility to budgeting. This 
credibility will lead to lower interest rates and a stronger economy.
  This same firm found that the lower interest rates that would come as 
a result of the constitutional amendment can create half the necessary 
savings that is going to take us to balance the budget. This is the 
case because interest on the debt is such a large portion of the 
budget.
  As these facts become known, Americans are learning that they can 
live with the reductions in the growth of Federal spending that will be 
necessary if the balanced budget amendment is adopted. They are willing 
to do their part to prevent future generations from being saddled with 
an unconscionable amount of debt. They are willing to do so even if it 
means that some Federal spending that they support will be affected. 
Importantly, the willingness to take the necessary steps to balance the 
budget derives from the whole populace, I believe, not just a few.
  This week, I received a letter from a person by the name of Andrew 
Alexander, the library director in Mason City, IA. As a librarian, Mr. 
Alexander receives funding for his budget from the Library Services and 
Construction Act. Obviously, one would expect that as a recipient of 
Federal grants his position would be against Congress adopting this 
amendment and changing the level, whatsoever, of funding in that 
program.
  Of course, he could certainly make an argument that was not based 
solely upon bureaucratic self-preservation, because we know that 
libraries are important, education is important and it would be 
possible to very sincerely argue that the Federal Government should 
then continue to help local libraries.
  But that is not what Mr. Alexander argued to me in his letter. He 
asked me and asked me to ask my colleagues in the Senate to discontinue 
all Federal funding for local libraries. Although he recognizes that 
the Library Services and Construction Act was passed with good 
intentions, it has produced, in his words, ``bad or negligibly good 
results.''
  He goes on to say: ``The Federal Government has no business involving 
itself in a function that has historically been very much the 
responsibility of local government.''
  I would like to mention that Mr. Alexander told me in this letter, 
``I am a lifelong Democrat.'' He goes on to say, ``I voted Republican 
last November because I am certain that if we do not stop spending more 
than we take in, we will, in fact, be the ruin of our children and 
their children.''
  So, Mr. President, it is letters like this that show me, and 
hopefully the rest of my colleagues in this body, that the American 
people have a greater understanding of the problem than cynics give 
them credit for. Americans of all political persuasions are realizing 
that the role of the Federal Government must be limited. They know that 
not all Federal programs have delivered what they promised. They also 
know the tremendous sums of money that are spent on these programs, any 
one that can probably be justified standing by itself, but adding up to 
a total spending exceeding $200 billion. You can easily see that some, 
or a part, of these programs cannot be justified.
  At the same time, the public knows that it is not paying for all of 
these programs. That is very clear. They know that the deficit and the 
national debt are out of hand and that for a small difference in their 
lifestyle, this very day, the destruction of the economic future of our 
Nation and the preservation of our freedom and our society can be 
avoided. They are willing to make that commitment. Oddly enough, until 
lately, some of them were not willing to do it, but now they are, as 
our budget and fiscal situation gets worse and worse.
   [[Page S3113]] I believe that this same realization is coming to 
certain Senators who may not have always supported the balanced budget 
amendment in the past. Additional Senators are understanding that the 
American people will support the changes that will flow from the 
balanced budget amendment. I think our colleagues--realizing that the 
American people out there are seeing how bad the situation is, are 
seeing these programs cannot continue to be funded at an unconscionably 
high level and a deficit level--are being fortified by this change of 
view at the grassroots and are seeing the public will stand behind them 
if they make the tough commitment to make sure the balanced budget 
amendment is adopted so the fiscal discipline will come, as it has to 
come after its adoption.
  So I appreciate the commitments from Senators who are signing onto 
this amendment every day to support this amendment as the debate 
continues. We have tried every other approach. Every other approach has 
failed: Gramm-Rudman I and II, the bipartisan budget agreement of 1990, 
the Clinton budget agreement of 1993.
  I have spoken before about my first involvement in legislation to 
balance the budget. When Senator Harry F. Byrd of Virginia was a Member 
of this body, he and I worked together--I was a Member of the House of 
Representatives--to pass a simple law that says the Federal Government 
shall not spend more than it takes in. That was a very well-intended 
but, quite frankly as I look back now, a very weak response because 
under our Constitution succeeding Congresses can obliterate anything 
that a preceding Congress has done. So, each of the cases I have 
given--the Byrd-Grassley law, Gramm-Rudman I, Gramm-Rudman II, and the 
other budget agreements of the 1990's--have failed because they can be 
changed so easily.
  Whereas a constitutional amendment, though difficult to get adopted 
in the first place, is also difficult to change. So it will not be 
changed by a simple unwillingness of a body to follow its mandate, 
because we take an oath to uphold that Constitution. We see the 
restraint that a constitutional provision brings to States, and in 
State legislatures controlled by conservative Republicans or even 
liberal Democrats that oath and the rule of law applies. And there is 
better fiscal policy there than what we have at the Federal level.
  So only the balanced budget amendment, then, will respond to the 
informed judgment of the American people that the role of the Federal 
Government must be rethought. Programs will have to compete with other 
programs once we do not have the capability, willy-nilly, of borrowing 
from the future generations. When the total must be paid for, choices 
will have to be made. It will no longer be sufficient that intentions 
behind the programs might happen to be just somehow very good or, the 
usual explanation, the needs are so great.
  This is a view held not only by Republicans but by Democrats and 
independents as well. A new day will come when we have a constitutional 
amendment disciplining our spending appetites. The Senate passage of 
the balanced budget amendment will show Americans that we have listened 
to the people and we have their long-term interests in mind. The people 
have been ahead of the Senate. Now it appears we are catching up, as a 
result of the last election. The American people have spoken loud and 
clear. They should be commended for making their views known and they 
should also be commended for taking a stand for responsibility.
  They should also understand that, out there at the grassroots of 
America, as they express their views to us personally, as they express 
their views through the election process, they can make a difference. 
If we adopt this amendment, it is one more example that people who want 
change are going to get that change.
  So I think once again the American people have spoken and, in the 
process of speaking, they are showing that they are smarter than the 
pundits.
  I yield the floor.
  The PRESIDING OFFICER. The senior Senator from Kentucky.
  Mr. FORD. Mr. President, I thank the Chair. I have had an interesting 
day listening to the comments on the Senate floor by various and sundry 
Senators, where some have taken a part of history, Madison, Hamilton; 
some on the street, grassroots, all of that. So it is a mix. I was glad 
to listen and to get a feel.
  This body, in my opinion, is blessed with some former Governors. One 
of those spoke today, the new Senator from Missouri. I thought he made 
an excellent speech. I enjoyed his comments, his delivery, and his 
content. But being a former Governor, he should understand that he had 
to work with the legislature. He had ideas and thoughts, he had 
programs and commitments he made in his campaign that he wanted to get 
through the Missouri legislature. And he found, I am sure, people on 
different occasions who did not agree with him. Some did not agree with 
him for personal reasons. Some did not agree with him for political 
reasons. Some did not agree with him on philosophical reasons.
  So that is where we find ourselves today. You know that every once in 
a while you have a hung jury in the court system. Eleven to one and you 
have a hung jury. One person believes and feels that an individual is 
not guilty and, therefore, that person votes that way so you have a 
hung jury--11 to 1. That is our system. It worked pretty well. It 
worked pretty well.
  A couple of things bother me, Mr. President. I guess you might as 
well get them out of your chest, out of your heart, out of your head 
here. There will be no trouble passing this constitutional amendment--I 
voted for it twice--but this is not the same amendment that I voted 
for. This does not have the restriction on the Federal courts which was 
accepted, I believe, almost unanimously the last time we had a 
constitutional amendment up last year. It was offered by the 
distinguished Senator from Missouri, by the way, Senator Danforth, and 
that constitutional amendment was voted on. My good friend, long-time 
friend, distinguished Senator--I do not think anyone doubts his 
integrity or his loyalty to this country--Senator Nunn from Georgia, 
said last night if his amendment, which is the Danforth amendment of 
last year, is not accepted, then he just cannot vote for the 
constitutional amendment when the courts will tell you whose taxes to 
raise, whose taxes to cut, what program to extend, what program to cut. 
If they have that ability he just cannot vote for this amendment.
  I suspect if that amendment is accepted, the constitutional amendment 
will pass. But if you are going to stonewall, I do not believe there 
has been a Republican vote for a Democratic amendment that has been 
proposed on this constitutional amendment. I may be wrong. Maybe on the 
judicial question of Senator Johnston, and that is the question that 
bothers my friend from Georgia, Mr. Nunn. But that is the only one. I 
believe that is the only one.
  To say that we are going to take the Social Security trust fund that 
so many people are depending on, and we are going to use that, put it 
in the general fund and help balance the budget--I do not know whether 
I am different or my constituents are different. I can learn a lot at 
the barber shop. At the barber shop 2 weeks ago, there were a lot of 
young fathers there bringing their sons in to have a haircut. There I 
sat waiting for mine. These young fathers I knew--and I probably knew 
them from a young age--asked me about only one thing.
  They said: Senator, we are for balancing the budget. We think we 
ought to reduce the cost of Government. We ought to reduce our taxes, 
if we can. We are willing to accept a freeze on our taxes. But Social 
Security? Mom and Dad are drawing Social Security. They have a small 
pension or 401-K or something from their previous employment. The check 
from Social Security, that they had been paying into for years and 
years, is now in jeopardy because of the constitutional amendment. If I 
do not fly, I do not pay the airport improvement trust fund tax. But 
that will go into the general fund, also. The highway trust fund will 
go into the general fund as such to be used. All of the trust funds now 
are going to be used in order to try to balance the budget. I get the 
argument. If we do not do that, Social Security is not going to mean 
anything, anyhow.
   [[Page S3114]] Well, I do not know about that. But let us get back 
to the Social Security. You have to pay Social Security if you work. It 
comes out of your pay, whether you want it or not. It is matched by 
your employer. If you are self-employed, you pay the whole thing. That 
is mandatory. We have to change the Social Security system. We need a 
means test. We can do that without it being in the constitutional 
amendment, saying we will not use that surplus. We can still change the 
structure of the Social Security system.
  I hear a lot about dropping that 85-percent tax. If you make $34,000 
or $44,000, for a couple, drop it back to 50 percent, the couple says, 
then still charge 85 percent, but take the difference between the 50 
and 85 and put it in a Social Security trust fund so it will be there 
in the future for others that come behind us.
  It makes some sense to me. All kinds of propositions are being 
offered, but no one on that side. The Republican side will vote to say 
no, we are not going to use the Social Security trust fund to balance 
the budget. We want them to continue to pay their taxes, continue to 
pay their Social Security, continue to pay their gasoline tax, continue 
to pay their airplane tax, continue to pay all of that to go into 
balancing the budget. They are designated taxes. I do not think any of 
us are fussing too much about the tax on your airplane ticket. Some 
may. We are not fussing too much about the gasoline tax. But there is 
something very, very personal about Social Security taxes. It is there 
for the future. It is there for retirement. It is there so they will 
not be a burden on their children.
  So when we refuse to do that, then some in this body have just said 
they refuse to support the amendment. Somehow it is hard for me to 
understand why that is not accepted, and we will go ahead and pass the 
amendment. Everyone in this body knows that it would pass this body if 
that was acceptable.
  Second, to keep the courts out--several Senators in this body are 
swallowing awfully hard to cast every vote against Social Security, 
against the proposition that we do not want the courts telling us what 
to do. They are swallowing awfully hard. That vote is coming back. We 
will have it. The votes on Tuesday about Social Security and about the 
courts will tell you whether this amendment is going to pass or not. I 
want to vote for it. I want to vote for it. But you are stopping me 
from voting for it because of two little items. I am getting a little 
bit harassed, I guess--or worried--because very time a good amendment 
comes up, the floor manager says, ``Senator, you have a good idea. I 
wish we could put it in this amendment. But we do not want to send it 
back to the House. The House has steamrolled everything they brought up 
over there.''
  Why are you afraid to send it back? What is the reason that you will 
not send it back? I believe with all my heart that if you send the 
Social Security portion back and take the courts out of telling us what 
to do, the House will pass it in the flick of an eye. So why will you 
not include it? I do not know. They just do not want to send it back to 
the House.
  ``Senator, we will work with you after we pass this amendment. You 
have a good idea. We will try to get it done. I look forward to working 
with you, trying to solve this,'' when you know the implementing 
language can be changed every day. And the statements by the leadership 
on these sense of the Senate, or whatever it might be, sounds good; 
votes, in order to take care of it. You have a judicial resolution out 
here now or a sense-of-the-Senate resolution to try to salve the pain. 
I think we have had enough of that. They do not want to send it back to 
the House.
  I hear a lot about we do not have the intestinal fortitude to make 
the decisions to balance the budget. My friend from Iowa, who just 
spoke before me, mentioned the Clinton budget of 1993. I want to tell 
you, there was not much intestinal fortitude that came across that 
aisle right there. We raised taxes on the top 2 percent. We cut them on 
others. We cut programs and reduced the deficit by $700 billion over 5 
years. That is about the round figure. But we did not get a Republican 
vote, and even lost a Democrat or two. But we did not get a Republican 
vote.
  Are the Republicans trying to tell this Senator that we have to have 
a constitutional amendment that forces us to balance the budget? We 
have had one experience already during this administration. That 
experience was a hard-fought experience. Sure, we raised taxes. That is 
what everybody said we are going to have to do. Sure, we cut programs. 
That is what everybody said we had to do. And we are going to reduce 
the employment of the Federal Government by 272,000 people.
  We have already reduced over 100,000 employees of the Federal 
Government. We are reducing Government. So it is very difficult for me 
to see why you will not accept at least two proposals. I think that the 
supermajority, three-fifths, for deficit spending in a time of 
emergency is trying to go against what the framers of the Constitution 
have said. It has been good for a long time, a simple majority. The 
Vice President has a right to break the tie, and then we can go on 
about our business. But, no, we have to have three-fifths in order to 
deficit spend, and we have to have 51 Senators. We exclude the Vice 
President from his constitutional position of breaking ties in the 
Senate under this constitutional amendment. We have to have 51 
Senators.
  I thought it was a good debate when we said that the 51 votes then 
could be used to take money from other programs and put it into the 
defense of this country. I do not know how long it would take us to do 
that, going through the House and the Senate, arguing over whether we 
are going to take money from nutrition programs, WIC programs, housing 
programs, whatever, and put it into defense. But you need 51 Senators 
and, I guess, 218 Members of the House to do that. In that debate, it 
was brought up that it has to be done every fiscal year. So that is 
from October 1 to September 30. What if it came up on September 1 and 
we had less than 30 days left and 11 months of the money had been spent 
for that fiscal year? There would be no more money left. You can take 
all the money for Government use for other programs and try to put it 
into the defense of this country. So they say if we have a problem with 
the defense of this country and if we were being attacked, there would 
not be any trouble getting the money. We have to be prepared sometimes 
to prevent it from happening. We have to make that decision.
  I have tried my best to stay out of the partisan political position 
that this is obviously trying to put people in. I understand what is 
happening here. I have tried to approach this question as best I could 
as a Kentuckian and as an American. I only ask two questions: Why can 
we not accede to exempting the Social Security trust fund? Why can we 
not allow an amendment to go on this constitutional amendment to keep 
the courts out of telling us who to tax and who not to tax and who to 
increase and who to decrease, and what programs to cut and what 
programs not to cut? I hear people say that is not what this thing 
does. Why is there all this nervousness? You can feel it around this 
Chamber when you start talking about the courts. It was a close, hard 
vote, 51 to 47, I think was the vote. This amendment would sail through 
here--sail through--and we are only asking two questions. Is that so 
hard to accept? Is that so hard to accede to? Is it too hard for some 
of those that apparently want to harm people, unless they are rich--the 
rich will not care too much about Social Security. But the average 
American out there, particularly those who have retired or are about to 
retire, are certainly worried about having their Social Security. Their 
families are worried about their mothers and fathers having Social 
Security.
  I had a Sunday school teacher, one of the best Christians I guess I 
have ever known, outside of my wife and family, Beryl Brown. He was one 
of the strongest Republicans and nicest fellows I have ever met. Every 
once in a while, he would compliment the Democrats for having Social 
Security. That is about the only thing he said nice about Democrats or 
the Democratic Party, that we started Social Security. He said, ``The 
reason it is good and I think it is a program that ought to stay is 
that Mama and I can stay home. We do not have to worry about moving in 
with our family. We can enjoy ourselves, have a little garden out in 
the 
[[Page S3115]]  backyard and have enough income to get along.'' That is 
Social Security.
  If you are rich, it does not make any difference. But if you worked 
hard all your life and you expect a few years of having your own way 
and playing with your grandchildren and doing all those things, then 
Social Security is important. But I see that question slammed every day 
in this Chamber. If you are going to be against the elderly and against 
the young folks, with the reduction of WIC, nutrition programs, 
education, Social Security, well, somehow or another I believe it will 
come back to haunt us, and it will not take long. But if those two 
items are in there, I think you can accomplish what you want.
  So, Mr. President, I hope that I have explained my position a little 
bit. There are not enough votes to pass the amendment as of this 
moment. I wish there were enough votes, because if there were enough 
votes, you would have Social Security trust fund excluded, the surplus, 
which the recipients are depending on, and you would say we would not 
be yielding what our forefathers gave to us to protect, and that is 
giving a piece of the legislative branch of Government to the courts; 
and, second, when we get to the line-item veto, we will be giving that 
portion of it to the Executive, and we slowly but surely erode what the 
forefathers said we ought to have, which is three branches of 
Government--executive, legislative, and judiciary. They are all there 
for a purpose and they have all worked very well.
  We are putting fiscal policy in the Constitution. I understand that 
there are other things that relate to the economy in the Constitution. 
But just two questions is all the people ask. There is a difference and 
there is a holdout. There is a holdout. We have 51 that are saying we 
want to take Social Security and put it into the trust fund and pay the 
budget deficit off. We have, maybe, 15 more--14 probably now--that want 
to agree with that, or will agree with that, for various and sundry 
reasons. This could be a hung jury--11 to 1--and so be it, Mr. 
President. So be it.
  I see other Senators are here wishing to speak. I will not take any 
more time of my colleagues.
  I yield the floor.
  Mr. JEFFORDS addressed the Chair.
  The PRESIDING OFFICER (Mr. DeWine). The Senator from Vermont Mr. 
Jeffords, is recognized.
  Mr. JEFFORDS. Mr. President, I have listened to the very eloquent 
statements of my good friend from Kentucky. Certainly, all of us 
understand the need for the protection of the Social Security System. 
Certainly, I, like others, was torn when I had to vote on amendments 
that would be sacrosanct and separate from the possibilities of being 
tampered with by the balanced budget amendment.
  However, I can make the same kind of arguments on behalf of the 
children of this country for nutrition and the reasons why we should 
make sure that we do nothing that will endanger their ability to be 
protected from cuts which might damage their future.
  In a moment, I will talk about the care we must take when we make 
cuts, because if we do not recognize that education is so important to 
the foundation of our society and our economy, if we make mindless and 
unwarranted cuts in that, we will be counterproductive in the ability 
of us to balance the budget.
  However, I came to the conclusion in deciding to vote for the 
balanced budget amendment that we had to leave ourselves open to all 
options and that we could not pick and choose those things for which we 
ought to try to protect. And I understand and realize that it would be 
much easier for us to separate Social Security from it.
  Mr. President, on February 13, I came down to the floor to discuss my 
position on the balanced budget amendment. I outlined the concerns that 
increased debt load places on our economy and our future generations 
and how the interest payments we are making now on the budget are 
threatening everything else, now having exceeded the defense 
expenditures and the discretionary expenditures. I outlined at that 
time that in the past, in 1982, when I had been in the House only some 
8 years, I was first faced with the balanced budget amendment. I said 
at that time, ``I won't vote for it because we can't wait 7 years for 
the budget to be balanced.''
  At that time, we had just had a very important bill passed which 
greatly reduced the taxes of this Nation. I was the only Republican 
that opposed that amendment which made drastic cuts in our taxes, and I 
stated at that time that I was afraid that what we had done would lead 
to huge deficits in the future. I took a lot of abuse at that time for 
that vote. But, as history has shown, that vote probably was one that 
was the best judgment I could have exercised at the time.
  But, as we now know, it is important for us to pass the balanced 
budget amendment. We must begin to balance the budget and to outline 
our priorities. So we must be careful not to make balancing the budget 
more difficult.
  Today, I will talk about the need to be careful on how we cut, 
especially in the field of education. I am the chairman of the Senate 
Education Subcommittee and, therefore, have a particular responsibility 
to make sure that what we do from this point on does not in any way 
inhibit the ability of this Nation to be able to meet its commitments 
to its young, but most importantly its commitments to this Nation that 
we maintain our ability to be the most competitive and the most 
economically sound nation in the world.
  I am afraid, as I look across the Congress to see where cuts are 
being made. I also recognize the future needs of our Nation especially 
in the area of education. For without immediate attention by this 
Nation on our educational system, we are facing incredibe danger for 
our economic future. We cannot move forward without recognizing that 
cuts within the educational system may well prove to be 
counterproductive--counterproductive in that they will reduce the 
potential revenues that we would otherwise have and that they will only 
increase the social costs that we are presently experiencing.
  So let me now, as we go into the 21st century, take a look at where 
we are with respect to education and the need for us, a Nation, to 
place ourselves in more competitive position within the international 
economic community.
  In order for our country to remain viable in the global economy we 
must not only be free from crippling interest payments on our debt, but 
we must also prioritize our spending so that we maneuver ourselves to 
be ready to face the challenges of the new millennium. If we do not act 
now, we will destroy the dreams that we cherish--good health, a good 
education, a good job, and a good retirement.
  Some have proposed that we reduce the deficit simply by making 
across-the-board cuts on all programs. Such cuts might provide a 
solution to our financial woes in the short term, but they only 
exacerbate the deficit in the long term. Here is why. If we cut back on 
programs for education and training, we lose our competitive edge in 
the marketplace, resulting in a lower standard of living, fewer high 
paying jobs, less Federal revenues in taxes, and, naturally, a larger 
deficit.
  On the other hand, if we work to improve our education system, we not 
only increase our national productivity, but our standard of living 
will increase, resulting in greater Federal revenues and a decreased 
need to invest in our social programs.
  In Michael Crichton's recent book, ``Disclosure,'' the main 
character's professional advancement is threatened by the appointment 
of a woman as his supervisor. He is so distracted by the immediate 
problem of sexual harassment that he only belatedly understands the 
advice from an anonymous ally.
  That advice--to solve the problem. And he keeps repeating, ``Just 
solve the problem.''
  I believe this advice applies to the larger problem that we face 
today. If we solve the larger problem, then this will solve those 
immediate ones that we look at with respect to our inability to fund 
the various programs we all desire to fund. For if we do not improve 
our educational system, and if we are unable to solve the deficit 
problem, we can not ensure that we have the capacity to provide for the 
programs we need. And then we will find that the problem of balancing 
our budget is unsolvable and that this Nation will disappear in the 
next millennium as a lesser nation.

[[Page S3116]]

  The way to solve the problem of our deficit is not, as some suggest, 
mindless across-the-board cuts. Solutions to our financial woes are 
long-term investments--specifically in our education system. By not 
solving the problem of reduced productivity and higher costs through 
education failures, interest payments will keep increasing, tax 
revenues will keep decreasing, and our deficit will only grow larger. 
More mindless cuts is not the answer. Instead, thoughtful investments 
and adequate resources are the solution to our long-term fiscal 
concerns.
  Consider for a moment the education spending patterns over the last 
decade. Since the beginning of the 1980's overall Federal support for 
education, after adjusting for inflation, has decreased by 5 percent. 
Funds for elementary and secondary education declined 15 percent, while 
postsecondary education funds declined 24 percent. Where has that led 
us? Certainly, not to the first class education system we all support. 
In fact, using the six education goals developed by a bipartisan group 
of Governors in 1989 as our barometer, we are not close to reaching our 
mark of excellence in education.
  Among the goals for our future is that our children come to school 
ready to learn, that they come without hunger, and that they come with 
the capacity to be able to understand the education that they are going 
to be faced with. That means they must first be fed, immunized, and, 
hopefully, have had some preschool experience. However, only 45 percent 
of young children from low-income families are enrolled in preschool 
programs and only 55 percent of infants have been fully immunized, 
protecting them against childhood diseases. Head Start continues to 
only serve one-fourth of all eligible children in this Nation.
  We also recognize that educated people who can compete in the global 
marketplace require a mastery in challenging core subject areas--such 
as math and science--and that all adults be literate and prepared for 
life-long learning. Unfortunately, in these basic areas, we are far 
from the finish line.
  The 1993 National Assessment of Educational Progress indicates more 
than 75 percent of students at all grade levels failed to achieve even 
the basic level of proficiency, and over 60 percent failed to meet the 
proficiency level in English.
  In international comparisons, American students consistently score 
below most other industrialized nations.
  In the 1992 international assessment of education progress U.S. 13-
year-olds scored second to last among the nations in mathematics 
achievement, and similarly in science.
  More recently, a report recently came out that investigated the 
literacy of children that graduate from high school. The report found 
that 51 percent of the students now graduating from our high schools 
were functionally illiterate. That is, incapable of handling an entry-
level job with their educational achievement.
  Make no mistake about it. These disturbing statistics are not about 
someone else's children. They are not someone else's problem. These are 
our children. These are our problems. Our future work-force and our 
future leaders. The quality of our public schools in America, is 
directly related to the standard of living of each and every citizen. 
Without a strong investment in education, this Nation will not be able 
to maintain an adequate number of highly-skilled workers, these workers 
are necessary if our country is to maintain a competitive position 
within the global marketplace.
  To give you a quick idea of why curing our educational ills is 
critical and key to our future, we will examine a yearly cost of our 
failing educational system. The total cost of our failure in education 
to our economy has been estimated to be one-half trillion dollars each 
year to our economy.
  The lost revenue alone has been estimated to be about $125 billion. 
That is, if the educational levels were where they should be, the 
income to the Nation, relative to furnishing our budget, could be 
higher by $125 billion, putting us a long ways towards being able to 
have the budget balanced.
  For example, American business spends approximately $200 billion a 
year to perform training for employees which is necessary to provide 
those individual minimum skills required to perform on the job, skills 
most of which should have been taught in the schools.
  The Department of Education estimates that 30 million Americans are 
functionally illiterate, another 46 million are marginally literate. 
This creates a significant problem for our economy. ``Combating 
Illiteracy In The Workplace,'' by Robert Goddard, puts the cost of this 
illiteracy at a staggering $225 billion a year. This includes lost 
productivity, unrealized taxes, crime, welfare, health, housing, and 
other social costs.
  We pay for our failed educational system every time an individual 
drops out of high school. Lack of a high school degree costs an 
individual $440,000 in lifetime earnings. These lost earnings often 
drive these individuals into welfare, crime, and drugs. Up to 80 
percent of our people that are incarcerated in our State jails are 
functionally illiterate, school dropouts.
  Federal expenditures for welfare were $208 billion in the fiscal year 
1992. The cost of incarceration, which I mentioned, is $25 billion per 
year and growing, and the medical costs of violent crime is another $18 
billion per year. Illegal drugs cost the economy $238 billion a year, 
as estimated by Brandeis University. These difficult circumstances 
perpetuate themselves generation after generation.
  I think most Americans agree, and in poll after poll people cite the 
quality of education as a paramount concern. The support for education 
in these polls is often cited as one of the most important roles of 
Government. Americans understand intuitively that investing wisely in 
education is the key to our future success and the best possible 
national investment we can make for the country. The evidence is clear: 
Countries which spend more on education per pupil have higher levels of 
per capita GDP. Institutions like Motorola report corporate savings of 
$30 to $35 for every dollar on training. That is 3,000- to 3,500-
percent rate of return. But most of that education, if you read the 
report, was to make their students literate to put them in a position 
where they could read.
  They found, amazingly in their study, they were having trouble with 
their employees answering simple math problems and they could not 
believe they do not have the capacity to do the math, when they found 
out the problem was they could not read the problems. Thus they had to 
teach them how to read to do simple math problems. That is the state of 
the situation, and that is Motorola, one who can be selective in their 
employees.
  People, as rational consumers, also realize investing in their own 
education leads to substantially higher lifetime earnings. A person 
with a bachelor's degree earns over 1.5 times of the person with a high 
school degree. A professional degree earns over 350 percent higher 
lifetime earnings than a high school diploma in itself.
  While we recognize both intuitively and through research the economic 
rewards of education, we do not simultaneously invest the funds 
necessary to support the position. Many of my colleagues, while 
acknowledging the importance of educational investments, argue that 
throwing money at education is not the solution. I could not agree 
more. Increasing educational expenditures in itself will not solve our 
country's educational deficiencies.
  We have a responsibility to invest educational dollars wisely, 
including more active congressional oversight over Federal initiatives. 
Simultaneously, we must also reinvigorate our schools by demanding that 
students learn to high academic standards.
  Why? Because the status quo in our schools has failed. Too many of 
our graduates finish school without knowing the three R's, much less 
more rigorous academic standards. Clearly, there is no room for 
federally mandated standards. We should be providing incentives for 
States and communities to set high goals for student achievement--pupil 
by pupil, and school by school.
  More importantly, they must know what standards this Nation must 
reach, if we are going to be able to continue to compete 
internationally. It is one thing to believe that our education, as most 
people in this country do, has improved over the time they were in 
school, and I find that is true for myself. I am amazed that the 
students in 
[[Page S3117]]  high schools are taking subjects which I did not get 
until college.
  What they do not realize, for instance, in a recent report on the 
comparison of our students to other nation's students we fared poorly. 
One example is with Taiwanese students. These students when they 
graduate are 2 years ahead of our students in many subjects, such as in 
math. Is it any wonder we come out last in these tests, or next to 
last?
  What is important is that we know and that the States know that we do 
have a problem. That this Nation is faced with a very serious 
educational problem, and if we do not do something about it, we will 
not be the Nation we must and should be in the next generation.
  So we must be sure that when we begin to reduce the budget to try and 
balance it that we do not do counterproductive cuts which will decrease 
our revenues and increase our social costs. Rather than cutting the 
deficit it will increase the deficit.
  This last dream can only be realized by setting high priorities on 
education and educational investment. These increases are essential if 
our country wishes to remain viable into and throughout the next 
century.
  Next, Mr. President, I would like to mention something else which I 
think is incredibly important. I think that we must realize if we are 
going to bring this deficit under control we must do something about 
escalating health care costs. This is an area that I and many of my 
fellow Members have been deeply involved in. I would say that we must 
realize that if we do begin to tackle our national health care problem, 
there is no hope for bringing the federal deficit under control.
  Mr. President, one of the only ways we can balance the budget is by 
getting the Federal health care expenditures under control. For 
example, CBO estimates that if we do not address the health care 
expenditures, the debt will grow by $1.4 trillion by the beginning of 
the next century, due to health care costs.
  The chart I have here for my colleagues to look at demonstrates what 
will happen if we do not get health care costs under control. I point 
out that the red line indicates current health care trends for Federal 
expenditures.
  Mr. President, 2 years ago I introduced a bill, worked very hard to 
demonstrate that health care expenditures can be brought under control. 
If this bill was passed into law that Federal health care expenditures 
could be brought under control and that the anticipated national debt 
could be reduced by $1.4 trillion over the next 10 years.
  That yellow line on the chart demonstrates what could be done if my 
plan was accepted last year. But that is not the only plan. That plan 
worked by shifting the burden of hospital care back to the States, 
capping our Federal expenditures and allowing the States through 
managed care and other processes to bring this under control.
  However, now it is important that we look at other measures. For 
instance, we found out this past year that with the Clinton bill, and 
bills like it which tried to go too far, we were not ready nor was our 
society ready to go that far.
  Let us take a look before we do that, take a look at why it is 
important that we do try and get the health care expenditures under 
control.
  First of all, let us take a look at the entitlements and mandates. 
This chart demonstrates in red what is happening to items such as 
Social Security, Medicare, and Medicaid, as we move into the next 
century. It demonstrates clearly that if we do not balance the budget, 
we cannot get the costs under control, and if we do not take care of 
our entitlements, we never will.
  The next chart shows the biggest component which is increasing at the 
most rapid rate, which is in yellow, is Medicare and Medicaid. As you 
can see, where that was a relatively small growth up through 1985, 
starting in 1985 things just escalated out of control.
  My point is that Federal health care has to be brought under control 
or there is no hope of balancing the budget. As I indicated in a bill 2 
years ago, there is a method to do it. I am working now on another one 
that uses the private sector to demonstrate it can be done. Federal 
health care spending is projected to increase from 3.3 percent of the 
economy today--this is important, too--to over 11 percent by 2030.
  The growth of Federal health care costs poses an immediate and 
critical drain on our budget and thwarts our ability to balance the 
budget. The CBO projects that entitlement spending will be 58 percent 
of total Federal outlays by the year 2003, from 47 percent today. This 
represents an astounding 11 percent increase over 8 years.
  For unless appropriate policy changes are made by the year 2003, less 
than 15 cents of every dollar the Federal Government spends will be 
available for nondefense discretionary programs. And that includes 
education and programs for the poor, elderly, and disadvantaged 
Americans. We cannot let that happen.
  First, I want to outline some of the problems we face as we work to 
solve this dilemma. Medicare enrollment has been growing at an average 
annual rate of 2.2 percent per year since 1975, and is expected to grow 
at an annual rate of 2.1 percent through 1996. As the baby boomer 
generation reaches 65, beginning in the year 2010, the rate will rise 
even more. In fact, it will rise substantially more.
  Total Medicare expenditures have grown from $34 billion in 1980 to 
$160 billion in 1994. This means an average growth rate of 11.7 percent 
over this period. The CBO projects that Medicare expenditures will grow 
from $176 billion in 1995 to $286 billion in the year 2000. This 
represents an average annual growth rate of 10.2 percent over the next 
5 years.
  Mr. President, this trend cannot continue or we will only expect this 
growth rate to continue to explode as our population ages and, again, 
the baby boomers will be, into the next century, raising the costs and 
the number of people to be treated by a substantial number. But if we 
work hard, we can start to get our Federal health expenditures under 
control.
  Second, Medicaid is also affecting our ability to balance the budget. 
Total Medicaid expenditures have grown from $41 billion in 1984 to $138 
billion in 1994. The average annual growth rate from 1984 through 1990 
was 9.8 percent, while the average annual growth rate from 1994 was 
17.7 percent, an astounding jump.
  The CBO projects Medicaid expenditures will grow from $157 billion in 
1995 to $262 billion in the year 2000. This represents a compound 
annual growth rate of 10.8 percent over the next 5 years. Currently, 
Medicaid consumes approximately 18 percent of State spending and 
approximately 6 percent of Federal spending. Like Medicare, we cannot 
allow this trend to continue.
  If we are going to reach the goal, and I believe we can, we must get 
health care costs under control. I expect and believe we can do that. I 
am working toward that, and I know others are, too, but we must 
remember we cannot do it without solving the health care crisis and 
improving the educational system.
  Finally, I would like to raise another spectrum with respect to the 
needs of what we must do to balance the budget and get health care 
costs under control, and that is in respect to the fourth dream which I 
mentioned, to start with, and that is that we have a good retirement.
  Just to give an idea of why it is incredibly important that we bring 
health care expenditures under control, some 10 years ago, the amount 
of money in an average benefit package was about 50 percent health care 
and about 50 percent pensions. Twenty years ago, 35 percent was for 
health care and 65 percent was for pensions. Now it is 21 percent for 
pensions and 79 percent of each benefit package for health care. If you 
also take a look, as others have been working on, as to what is going 
to happen to Social Security in the next century, if you add to that 
this dimension, that little money now being put into pension plans, the 
problems of the elderly will be exacerbated.
  So, in wrapping up and finalizing, I reluctantly back the balanced 
budget amendment. I do so with the firm conviction that if we improve 
our educational system, we do not mindlessly cut or eliminate programs, 
we can prepare ourselves for the next century. We can, to a large 
extent, allow our economy to continue to expand, thereby allowing our 
nation to grow its way out of this deficit problem, with increased 
[[Page S3118]]  revenues and lower Federal spending on some programs.
  More importantly, in the immediate area, we must dedicate ourselves 
this year to finding a solution to health care reform. If we do that, 
as I know we can, if we have the courage to do it because it will 
require shifts and it will require the understanding of the elderly 
population that they will be cared for in a betterand more efficient 
way, we will be able to bring the budget deficit under control in the 
not too distant future. I am hopeful that we can. For that reason, I 
will support the balanced budget amendment.
  Mr. President, I yield the floor.
  Mr. MURKOWSKI addressed the Chair.
  The PRESIDING OFFICER. The Senator from Alaska.
  Mr. MURKOWSKI. I thank the Chair and wish the President a good 
afternoon.
  Mr. President, I know it is late and much has been said about the 
balanced budget amendment before this body. I am going to say some 
more.
  In 4 days, debate on the constitutional amendment to balance the 
budget will come to a close and finally we will cast our vote 
determining the fate of this historic amendment. We spent the entire 
month of February debating this amendment, and during this debate, we 
have considered and weighed the role the judiciary may play in 
interpreting and enforcing the amendment. We have considered how the 
amendment will affect benefit programs that have been created by 
statute, including Social Security. And we have debated the voting 
rules of the House and Senate with regard to waiving the balanced 
budget requirement.
  Throughout the debate, I believe the Senate has lived up to its 
reputation as the world's greatest and deliberative body. We have 
examined in fine detail all of the nuances and interpretations of the 
language of the amendment and have sought to allow all sides of the 
issue to be aired and debated.
  The distinguished chairman of the Judiciary Committee, Senator Hatch, 
who was just on the floor--I am sorry he cannot hear these words of 
praise, but I mean them genuinely--has been a superb advocate for this 
amendment. He, along with our colleague on the other side, Senator 
Simon, are to be commended for their diligence and commitment in 
leading the Senate throughout this debate.
  The distinguished senior Senator from West Virginia, Senator Byrd, is 
to be commended for his extraordinary work in leading opposition to the 
amendment.
  Senator Byrd first entered the Senate the year before my State of 
Alaska joined the Union. When he entered the Senate in 1958, his 
colleagues on this floor at that time included the illustrious Senators 
John Kennedy, Everett Dirksen, Lyndon Johnson, and William Fulbright, 
to name just four.
 Senator Byrd's determination and commitment throughout this debate 
will long be remembered by Members as well as historians of the U.S. 
Senate.

  But let us delve into our deficit history for just a moment. After 
listening and participating in this debate for the last month, I am 
convinced of one thing, both the proponents and opponents of the 
constitutional amendment believe that we cannot sustain the economic 
prosperity of this Nation if we continue indefinitely to run these 
extraordinary deficits. Our differences are solely about the means 
necessary to end the deficits, not the end in itself.
  The opponents of the amendment believe we need not amend the organic 
document covering this Nation, namely the Constitution, in order to 
balance the budget. This Senator believes that nothing short of 
amending the Constitution will change our addiction to spending and 
living beyond our means. In reaching this conclusion I rely simply on 
history.
  I would suggest to you, Mr. President, we simply do not have the 
self-discipline. You remember the extended debates on military base 
closings--how can we close bases in our own States? We agonized, we 
went on and on and on. Obviously, we could support the closure of a 
base in another State, but not in our own States. So we reached the 
conclusion the only way we could do it is to leave the entire matter up 
to a qualified board and they would select and reprioritize, and then 
we would be left with the responsibility of simply voting up or down on 
the package--and it worked.
  That is really about where we are on this issue. We have tried to cut 
spending, we have tried to increase revenue, and we continually run 
deficits to the point where we have to acknowledge that nothing else 
works. This will mandate a balanced budget over a period of time.
  Let us look at history. For more than one-third of a century, 34 out 
of the last 35 years, our Government has run a continuous and unending 
string of deficits. If you and I did that, our checks would be bouncing 
all over the place. What have we done? We have simply added to the 
deficit.
  We go through a curious process around here called a budget. We get 
our revenues and we get our expenses. They do not balance. So 
everything else we need we get by adding to the deficit.
  Even if we adopt this amendment next week, it is almost a certainty, 
a near certainty at least, that the unending string of deficits are 
going to continue for a while, into the year 2000 or thereabouts. If we 
adopt the amendment, however, we will surely be forced to lower the 
deficits in the next 5 years below the currently projected levels, and 
virtually everybody agrees on that. But the reality that must be faced 
is that by the end of this century--and that is less than 5 years from 
now--the United States will have run a deficit for four decades. We 
have become hooked on it. Four decades of deficits, and the result is 
that today our national debt is more than $4.8 trillion.
  I do not know of any person who can really imagine what $4.8 trillion 
really is, but let me try to put it into perspective. A $4.8 trillion 
debt means that every man, woman and child in America owes Uncle Sam 
$18,400. A family of four owes $74,800.
  If we do not begin to turn things around, the national debt will then 
jump to nearly $6.7 trillion in 5 years--if we do not begin to turn it 
around. In 5 years it will jump from $4.8 trillion to $6.7 trillion. 
That would mean that every man, woman and child in America would owe 
Uncle Sam $24,170 instead of $18,700. And the family of four would move 
up and owe almost $97,000.
  We have not been blind to these deficits. We have debated them. 
Historians will note for the last 10 years Congress and the President 
have sought to find solutions. We have sought to find remedies to the 
deficits. We have passed statutes. We have passed reconciliation bills 
and sequestration provisions, all in the name of getting our deficit to 
zero. On three occasions over the past 10 years, legislators on both 
sides of the aisle have sat down with the President and hammered out 
so-called solutions to solve the deficit, and on every single occasion 
the promise of a zero deficit has simply evaporated away because we in 
Congress have never had the political courage to do the one thing that 
would bring down the deficit, and that is to reduce spending.
  Yes, we have voted to raise taxes on more than one occasion, but we 
have never, ever cut, frozen, or capped spending. We have to do one or 
the other. It is just that simple. Some would suggest if we do not cut 
spending, we do not raise revenues, there is some other alternative. 
Some have suggested, given enough attorneys to study the problem, there 
might be another alternative. But I can tell you--not as an attorney 
but as a former banker--there is not any other alternative. You do one 
of those two things, you cut spending or you increase revenues.
  We have never faced up to the challenge of runaway entitlements which 
today account for 55 percent of Federal spending and will grow to 59 
percent by the end of this century. Quite the contrary, we have 
generally placed entitlement spending simply off limits in all the 
budget deals that have been negotiated over the past 10 years. And we 
all know why. It is simply that we do not have the self-discipline to 
make those cuts.
  What we do not consider, however, is the result; that if we do not 
face up to this obligation, getting this under control, our monetary 
system as we know it today will ultimately collapse. There is 
absolutely no question about it.
  That is a pretty big order when you recognize you have to have a 
healthy economy, you have to have a sound 
[[Page S3119]]  monetary system in order to meet the social obligations 
of our society. I have many letters from my State of Alaska, people 
expressing concern over cuts and what these cuts might mean to 
programs. Obviously, through the block grants giving the States more 
responsibility, we can make the process more efficient. We can take out 
the fat that results from administering these programs from the Federal 
Government and give that responsibility to the States, and they can do 
it much better. But the point is that in order to meet those social 
obligations we have to have a healthy economy, one based on sound 
fiscal principles and a dictate of a balanced budget.
  Mr. President, I know we have not had many charts around here in the 
last week or so, so I am going to spring three charts with one for 
dessert for good measure at the end.
  These three charts record the history of our ``get-tough" budget 
agreements over the past 10 years. The first chart shows the promises 
and the reality of Gramm-Rudman I, which we adopted in 1985. As you can 
see, Gramm-Rudman I was supposed to bring us to a zero deficit--down at 
the bottom--a zero deficit over a 6-year period starting in 1986 and 
ending in 1991. From a projected high of $172 billion, which is where 
we were in 1986, the deficit was supposed to come down by $36 billion 
each year. But in reality by 1991, instead of a zero deficit we were at 
a record $269 billion deficit. That is our first effort. It did not 
work because we did not cut real spending. The commitment was there, 
the will was there, it looked good on a piece of paper and looked good 
on a chart at the time we adopted it, but it did not happen because we 
did not have the commitment to make the real cuts.
  So then we made the second promise to the American people, and this 
is the second chart, and it shows the revision which we made to Gramm-
Rudman in 1987.
  Why did we make the revision? We simply had to because the original 
version was not working. In that year, we revised the original targets, 
changed the targets. New targets are up now, and this time we promised 
again a zero deficit by 1993. Promises are cheap around here, Mr. 
President. Quite frankly, this was a more astounding failure than the 
original Gramm-Rudman. It was not the fault of Senator Gramm or former 
Senator Rudman but of Congress which simply found enough ways to get 
around the law that when the deficit was supposed to be $100 billion in 
1990, it turned out to be more than double to $221 billion.
  Of course, by 1990, it was clear that none of the targets would even 
be remotely met. So at that time, we will all recall, President Bush 
entered into a summit agreement, broke his no-tax pledge--some people 
say that cost him the election--and the American public was again led 
to believe that we were finally getting a handle on the deficit.
  So what we have done here now is we have simply switched this thing 
around. When we needed to change the targets because Gramm-Rudman was 
not working, we went back to another budget deal. And what did we 
accomplish? Absolutely nothing.
  I had the privilege of being down at the White House at the time, or 
shortly thereafter when President Bush made the decision on the tax 
increase, broke his no-tax pledge. He was absolutely convinced that he 
would get support from our friends across the aisle, the Democrats, if 
he went halfway on a modest tax increase. He believed that was the only 
way he could get support for cuts in Government spending, and he 
genuinely believed that. There is absolutely no doubt in my mind. But 
it did not happen. It did not happen again, and it probably cost him 
that election.
  Well, let us move to the third chart now because it is a progression 
of where we are. The third chart again shows how the deficit was 
supposed to come down, supposed to come down, as a result of the 1990 
agreement. What this chart shows is that by this year, this year, the 
budget deficit was expected to be only $83 billion. Does that sound 
familiar, $83 billion in 1995? In fact, as the chart shows, the actual 
deficit is $109 billion higher at $192 billion.
  Now, that is the progression. That is where we have come. What these 
charts show is that there is no reason for the public to put its trust 
in the congressional ability to come up with a budget plan that will 
eliminate the deficit. We have done it. We have looked at the charts. 
We have seen the results. The results are quite the contrary.
  In the 10 years since we enacted the first Gramm-Rudman law, spending 
increased more than 53 percent, from $990 billion to more than $1.5 
trillion. Interest payments increased more than 70 percent from $136 to 
$235 billion, and the national debt more than doubled from $2.1 to more 
than $4.8 trillion.
  We are not kidding the American public. They have seen this charade. 
They have observed accumulated debt has gone up to $4.8 trillion, and 
they are fed up. They say enough is enough. What is even more 
discouraging, Mr. President, is that this administration which opposes 
this amendment and which, 2 years ago, was able to get our friends 
across the aisle to go along with the largest tax increase in history, 
in my opinion, has completely abandoned the goal of bringing the 
deficit under control.
  During the month that we have debated this amendment, the 
administration has submitted its fiscal year 1996 budget. Its latest 
budget shows an unending stream of rising deficits and debt, and I do 
not find a solution, not a solution is recommended, not a single word 
about how to reshape entitlements is contained in the President's 
budget. Instead, what the President now recommends is an increase, an 
increase of about 24 percent in Federal spending between now and the 
year 2000--an increase of 24 percent.
  How does the President propose to pay for increased spending? It is 
very easy, Mr. President. The President of the United States proposes 
to pay for increased spending by adding to the debt. That is how we got 
$4.8 trillion accumulated debt. His deficit spending adds nearly $1 
trillion of additional debt on top of our $4.8 trillion. That brings us 
up to $5.8, almost $6 trillion. And the only category of Federal 
spending that he proposes to cut that is identifiable is again our 
defense budget.
  In fact, if you exclude defense spending from President Clinton's 
budget, actual Federal spending will increase 37 percent by the year 
2000.
  Quite frankly, the budget presented by the President provides the 
best evidence that the only way we are going to balance the Federal 
budget, the only way, Mr. President, is to add a constitutional 
amendment requiring that the Federal budget be balanced. It is a 
process of deduction. We have tried all the other alternatives. They 
have not worked. We have not tried this. It will work. If the balanced 
budget amendment was now a part of our Constitution, the President 
currently would be in violation of his oath of office, if he submitted 
a budget that looked anything remotely like the budget he sent us 3 
weeks ago.
  Now, Mr. President, the question has been asked, well, are we broke? 
The answer is yes, this country is broke. We are dead broke, and I will 
tell you why. We simply can no longer labor under the assumption that 
it is business as usual in Washington; that we assume every year we can 
run deficits, each year a deficit. That means we spend more than we 
generate in revenues, so each year we are running a deficit of $150 to 
$250 or $350 billion.
  Now, this all adds up, and this debt has today brought us to the 
point where for the very first time in our history, we are now forced 
to borrow from the credit markets for the sole purpose of paying 
interest on the debt.
  Now, it may surprise some people to know that over the next 10 years, 
we would be running a surplus in the Federal budget in every year if we 
did not have to pay $200 to $400 billion annual interest on that debt 
that has resulted in our chronic inability to bring revenue and 
spending into balance.
  This is the dessert chart, Mr. President, that I promised you, the 
chart of last resort. This chart shows the devastating state of the 
Federal budget over the next 10 years. It shows that in every year 
between 1995 and the year 2000, every single one, all Government 
borrowing, all of it, Mr. President, all of our borrowing is for the 
single purpose of paying interest on that debt.
  If you look at the bottom line, you will see what happens to that 
debt. That debt is increasing from $4.6 trillion, 4.9, 5.2, 5.6, 5.9, 
6.3, 6.7, 7.0, 7.4, 7.8, $8.2 trillion. And do you know why, Mr. 
[[Page S3120]]  President? Because the interest each year on our 
accumulated debt is more than our debt each year. That is why we are 
broke, Mr. President. We are broke. We could finance defense spending, 
Medicare, Social Security, all other Government functions over this 
period and still accumulate a surplus of $360 billion if we were not 
saddled by this extraordinary debt that is going to go from $4.6 
billion in 1994 to $8.2 trillion in the year 2004.
  As the chart shows, in 1994 our deficit was $203 billion, precisely 
the amount of interest we had to pay. In other words, our entire 
deficit in 1994 consisted of interest on that debt. Without that debt 
service burden, we would not have had to auction a single Treasury note 
or bond in the market. In 1995, we would be running a surplus of $59 
billion, if we did not have to service the debt. Instead, as the chart 
shows, our $176 billion deficit results directly from the fact that our 
interest costs are $235 billion. The same holds true in every year 
through the year 2004.
  So if you look at this chart long enough, you will recognize the 
reality that, if we do not take this action now, this is what we can 
expect. Only it might get worse because these interest costs are based 
on current forecasts. Current forecasts suggest a little volatility can 
be unsettling. I can remember the prime rate in this country in 
December of 1980, 20.5 percent. These rates are somewhere between 6 
percent and 7.5 percent. So you can imagine what would happen. And it 
could happen again, Mr. President, and it would throw this chart higher 
than this roof.
  So I contend we are broke. We are borrowing just to cover our 
interest costs. We are subject to the shifting winds of international 
investment which flow from economic policies that may change in Bonn or 
London, or an earthquake in Japan, all of which have a direct effect on 
what the U.S. Government has to pay to service this unending sea of 
debt.
  Can you imagine just for a moment what would happen if the owners of 
our debt, the holders of those Treasury bills--of which 18 percent of 
the total balance of this $4.8 trillion is held by foreigners--decided 
to call it in, call it in, just $300 billion or $500 billion on our 
debt? How would we pay the owners? We could not, Mr. President, unless 
we inflated our dollar to the point that what $1 buys today would 
actually be worth 50 cents or less. That is what happens. We are close 
to it.
  Mr. President, this is a warning signal of what can happen when debt 
gets out of hand. We have seen it as late as the last few weeks with 
our neighbors to the south in Mexico. I would not attempt, of course, 
to even compare our two economies. Ours is far healthier, better based, 
stronger than Mexico, and there is no comparison between the importance 
and the stability of the dollar and the peso on the world currency 
market.
  But I would also note that Mexico's crisis is a crisis of investor 
confidence. The result of that crisis is that Mexico this week had to 
pay 45 percent interest on the rollover of a small portion of its 
international debt. Why did it have to pay 45 percent? Because the risk 
was so great. Do you know what investment does? It goes after the 
highest return and the least risk. And the calculation was that Mexico 
was a high risk and, to get the dollars, they had to pay a higher rate 
of return.
  Mr. President, it is not just happening in the south; it is happening 
in the north. Take a good look at Canada. Our neighbors in Canada are 
the most heavily taxed people in the Western Hemisphere. Do you know 
what they are paying for interest on their national debt? Twenty 
percent of the total budget of Canada is interest on their accumulated 
debt. Canada runs a health care system, a national health care system, 
that is an absolute, unmitigated disaster. It is a Government-run 
health care system. There is no control from the standpoint of having 
an inducement to reduce costs if you are a Canadian citizen because 
there is no direct benefit of such reduction to you. You can go in 
today, go in tomorrow, and on and on. We must learn from what is 
happening around us.
  The only way to get out from under this sea of red ink is to adopt 
the balanced budget amendment. And I think putting a simplistic and 
realistic acknowledgment that we have tried everything else and it does 
not work is the proof in the pudding. The public knows that no family 
or business can survive for long when, year in and year out, the 
principal of its debt grows, and all of its borrowing is dedicated to 
pay off the debt holders. That is where we are going.
  So, Mr. President, when future generations look back on the decisions 
we made in this last decade of the 20th century, I know they will 
appreciate the wisdom of the people and the Congress in adding the 
balanced budget amendment to the Constitution because it is the only 
viable choice we have. For this amendment stands for the proposition 
that future generations are entitled to economic freedom, unburdened by 
financial debts of past generations. It is our responsibility to end 
the practice of sending unpaid bills on to our children and our 
grandchildren. That is a principle that belongs in the Constitution, in 
the same sense freedom of speech and press belongs in the Constitution.
  So let us make no more excuses, Mr. President. Let us not use the 
excuse that we have to know where the cuts are before we can vote for 
this amendment. That is simply a copout for inaction. We have seen 
enough copouts. We cannot continue this spending. We are either going 
to have to take in more revenue or make the cuts. The public 
understands that. And the public will be watching each of our votes. We 
will have to stand up and be counted on this one.
  What the public does not understand is why this body, this Senate, is 
not moving in the manner in which the House of Representatives did in 
passing the balanced budget amendment.
  So I urge my colleagues to reflect on a very simple reality as 
evidenced by the charts. We have tried everything else. It has not 
worked. It is getting late in the game. And if we do not do it now, it 
may be simply too late forever for our monetary system as we know it 
today.
  I thank the Chair for its indulgence. I wish my colleagues a good 
day.
  Mr. WARNER addressed the Chair.
  The PRESIDING OFFICER. The Senator from Virginia.
  Mr. WARNER. Mr. President, I first wish to commend my distinguished 
colleague from Alaska for a very excellent discussion. I was privileged 
to join him here on the floor and, frankly, I learned a good deal from 
that. It was very well prepared and very well delivered.
  Mr. President, I observe the distinguished senior Senator from West 
Virginia momentarily on the floor. I am hopeful that he can join me for 
a colloquy after I give my remarks.
  Mr. President, I have been a cosponsor of the pending measure since 
its inception, and throughout my 16-plus years in the U.S. Senate I 
have invariably supported legislative initiatives calling for a 
balanced budget.
  I do so, Mr. President, because not only do I firmly believe in the 
fiscal ramifications but, equally important, this constitutional 
amendment, as it goes to our 50 States, will provide an education for 
all of our citizens as to the complexity of budgeting,
 and the difficulty of achieving a balanced budget, such that assuming 
this becomes eventually the law of the land, the people of the United 
States will have a far better understanding when we have to make those 
cuts which affect them individually. In some instances, it will hurt, 
but hopefully they will understand we are doing this for the benefit of 
all, particularly future generations. This debate will occur, of 
course, in the State legislatures. Each member of that legislature will 
have to go to the village greens of his or her respective community and 
hold that debate in the town halls. This coming Saturday night, in my 
State, I will go down to Shenandoah County, VA, and there in the 
firehouse--which is the largest structure for a gathering in this 
marvelous rural county in the historic valley of Virginia--I am going 
to talk extensively about this very measure and the thoroughness with 
which the Senate of the United States is considering this measure. I 
only wish that I could tell them that, with absolute certainty, the 
Senate will adopt it next week. I am optimistic, as are others, but I 
wish I could share that with my constituents on Saturday night.
   [[Page S3121]] My constituents, and others, have waited patiently 
these many years, because the State of Virginia is solidly behind it. I 
talked with my colleague, the junior Senator from Virginia, today and I 
am very hopeful that Virginia will have two votes next week for the 
balanced budget. Senator Robb appeared earlier today--a bipartisan 
appearance, which indicates that next week Virginia will get two votes, 
Mr. President, for this very important piece of legislation.
  As I have followed, along with my colleagues, very carefully this 
week, this debate, it sort of comes down to the argument that we need 
it because we look the public squarely in the eye and say we cannot do 
it; we cannot do it unless we have the constitutional amendment. That 
is a very candid admission. But by our votes next week, we make that 
admission to ourselves and to every citizen of this great Nation.
  People say, ``Are you sure you cannot do it? Have you ever tried to 
do it?''
  Well, I want to share with you a bit of interesting history. To the 
best of my knowledge, it has not been mentioned thus far in this 
debate. The Commonwealth of Virginia is among those States which 
require balanced budgets. My partner in this institution, when I first 
arrived in 1979, was Harry F. Byrd, Jr., whose father, Harry F. Byrd, 
Sr., had served many terms prior to him. Basically, he succeeded his 
father. The Byrd family was known as fiscal conservatives. Therefore, 
it was quite proper for Senator Byrd, in 1978--actually the year before 
I arrived in the Senate--to offer an amendment--S. 2152--which he 
attached to the Bretton Woods Agreement Act. The Bretton Woods Act 
authorized the United States to participate in a supplemental financing 
facility of the International Monetary Fund. That is not relevant. It 
happened to be a vehicle for the Byrd amendment. Senator Byrd, Jr., 
contended that only by bringing the cost of Government under control 
could we bring the cost of living under control.
  You might ask, why was he so troubled in 1978? He was troubled 
because there was double-digit inflation, not the relatively, 
comparatively low rate of inflation today, but there was double-digit 
inflation in 1978. It was Senator Harry F. Byrd's view that if we put 
in a balanced budget amendment, we could begin to bring that inflation 
under control. The majority of the U.S. Senate agreed with him. The 
text of this amendment was very simple and straightforward.
  I quote:

       Beginning with the fiscal year 1981--

  Mind you, this was calendar 1978. We were then in fiscal 1979. So 
Senator Byrd recognized it would take at least 2 years to begin to 
ratchet down this excessive spending.
  So his law said:

       Beginning with fiscal year 1981, the total budget outlays 
     of the Federal Government shall not exceed its receipts.

  It was a very short amendment. Repeating:

       Beginning with fiscal year 1981, the total budget outlays 
     of the Federal Government shall not exceed its receipts.

  Another interesting feature is that my distinguished colleague spoke 
very briefly--and I refer you to the Congressional Record of July 31, 
1978, page S23411. This was his speech, one paragraph:

       If this amendment is adopted, it would be a matter of 
     record on the part of the Senate for a balanced budget 
     beginning in the fiscal year 1981.

  Later that same day, Mr. President, the amendment passed the U.S. 
Senate by a vote of 58 to 28. Curiously, 14 colleagues were not voting. 
The Senate, within hours after the introduction of the amendment, 
adopted it 58 to 28. I ask unanimous consent to have printed at this 
point in the Record the vote on that amendment.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

               Vote on the Byrd Amendment, July 31, 1978


                               yeas (58)

                         Democrats (28 or 55%)

     Allen
     Bayh
     Bentsen
     Biden
     Burdick
     Byrd, Harry F., Jr.
     Cannon
     Chiles
     Church
     DeConcini
     Durkin
     Eastland
     Ford
     Hollings
     Huddleston
     Leahy
     Magnuson
     Matsunaga
     McIntyre
     Melcher
     Morgan
     Moynihan
     Nunn
     Proxmire
     Randolph
     Stone
     Talmadge
     Zorinsky

                        Republicans (30 or 86%)

     Baker
     Bartlett
     Bellmon
     Brooke
     Chafee
     Danforth
     Dole
     Domenici
     Garn
     Hansen
     Hatch
     Hatfield, Mark O.
     Hayakawa
     Neinz
     Helms
     Laxalt
     Lugar
     McClure
     Packwood
     Percy
     Roth
     Schmitt
     Schweiker
     Scott
     Stafford
     Stevens
     Thurmond
     Tower
     Wallop
     Young


                               nays (28)

                         Democrats (23 or 45%)

     Byrd, Robert C.
     Clark
     Cranston
     Culver
     Eaglton
     Glenn
     Gravel
     Hart
     Hatfield, Paul G.
     Hodges
     Humphrey
     Jacskon
     Kennedy
     Long
     McGovern
     Metzenbaum
     Nelson
     Ribicoff
     Riegle
     Sarbanes
     Sparkman
     Stevenson
     Williams

                        (Republicans (5 or 14%)

     Case
     Javits
     Mathias
     Pearson
     Weicker


                            not voting (14)

                             Democrats (11)

     Abourezk
     Anderson
     Bumpers
     Haskell
     Hathaway
     Inouye
     Johnston
     Muski
     Pell
     Sasser
     Stennis

                            Republicans (3)

     Curtis
     Goldwater
     Griffin
  Mr. WARNER. It is very interesting, because if you were to correlate 
those that voted for the Byrd amendment who are still in the U.S. 
Senate today--and I would like to read off a few names: Senator Biden, 
Senator Ford, Senator Hollings, Senator Leahy, Senator Moynihan, 
Senator Nunn, and Senator Mark Hatfield, and others of the Republican 
side. I mention Senator Hatfield because this Senator does not know 
what he might do regarding this amendment. But Senator Hatfield voted 
for this. It is interesting to note those who are in the Senate today 
that voted against it then: Senator Robert Byrd of West Virginia, 
Senator Glenn, Senator Kennedy, Senator Sarbanes. It is remarkable to 
see how the composition has changed in that relatively brief period. 
Some of the term limit folks might want to look at that someday. There 
is the vote. The amendment went in midday and, in a matter of hours, it 
was voted on--the same day. The debate was one paragraph long by 
Senator Byrd. No colleague got up to dispute the value of it, and it 
passed.
  On October 10--I remind you, this was July 31 when the amendment 
passed the Senate--that language became section 7 of Public Law 95-435, 
signed by the President as the law of the land. Very clear. This 
Congress bound itself to the Byrd amendment. It became the law of the 
land. We had a balanced budget amendment controlling this body, 
beginning in fiscal year of 1981.
  In 1980, the Congress readdressed the Byrd amendment, and it was 
modified again in the Bretton Woods Agreement Act of 1980, on October 
7, 1980, to read as follows:
  ``The Congress reaffirms its commitment that beginning with FY 1981 
the total outlays of the Federal Government shall''--I underline 
``shall''--``not exceed its receipts.''
  Reaffirmation, once again. Now, it becomes interesting. We are 
getting to that point where the amendment which is binding on the 
Congress and the word ``shall'' is once again reexamined by the 
Congress. The year is 1982, as part of the recodification case of title 
31, U.S. Code, public law 97-258, September 13, 1982, 96 statute 907, 
the Byrd amendment was restated, but restated in a different form.
  I go to the code and read the Byrd amendment as it is the law today:

       Congress reaffirms its commitment that budget outlays of 
     the United States Government for a fiscal year may be not 
     more than the receipts of the Government for that year.

  [[Page S3122]] Mr. President, the key is the word ``may''--examining, 
of course, how we interpret the laws. ``Shall'' was binding. ``May" 
became permissive. There is a very clear record of how this body got 
right up to where it was going to bind it and quietly slipped in the 
word ``may'' substituting for ``shall.''
  What better example of how this institution, having come to grips 
with this issue, having voted with this issue twice, then quietly and 
surreptitiously changed one word, basically, to make it permissive.
  That was the end of the Byrd amendment. That is why I and others are 
here and have been for these many days, to urge this body once again to 
adopt, in slightly different form, the wisdom of the Byrd amendment and 
make it binding on this, the Congress of the United States. I yield the 
floor.
  Mr. BYRD. Mr. President, before the distinguished Senator from 
Virginia [Mr. Warner] leaves the floor.
  Mr. WARNER. Mr. President, I would be very happy to listen to my 
distinguished colleague.
  Mr. BYRD. Mr. President, the Senator pays me great honor and flattery 
to think that at this late hour, the Senator from Virginia would listen 
to me for even a short length of time.
  I want to comment, in view of the fact that he has mentioned the 
illustrious names of Harry Flood Byrd, Sr., and Harry Flood Byrd, Jr. I 
had the great honor and privilege and pleasure to serve with both Harry 
Byrd, Sr., and Harry Byrd, Jr.
  This is somewhat coincidental, perhaps, as I was saying to Senator 
Warner just a little earlier. I have just received a letter from a 
constituent of mine who lives at Salem, WV. It mentions the name of 
Harry F. Byrd, Sr. I shall read the letter. It was written on the 14th 
of February. It reached my office on the 17th of February.

       Senator Byrd: Enclosed is a letter I thought might be 
     enjoyable for you to read. You also may keep it, if you wish. 
     Years ago my children and I were going to Baltimore, 
     Maryland, and went past your father's orchard. I stopped and 
     allowed my children to pick up an apple each, and one for me, 
     as I assumed the ones had fallen.
       Regardless, I came home and fully decided that I had stolen 
     the apples. Today we could be shot for doing this. I was poor 
     and had dimes to pay for the apples. I have saved this letter 
     because he touched my heart by it. The dimes, I am sure, was 
     picked up by my kids maybe me. Who knows.
       I loved him and I feel you are just about like him. I think 
     you are doing a fine job. Thank you. Dorothea Moses.
       P.S., I'm old now and write uphill.

  Well, of course, I am not the son of Harry Byrd, Sr. I wrote the 
lady, thanked her for the letter, and stated that I came up in the home 
of a poor coal miner in southern West Virginia, although I served with 
both Harry Byrd, Jr. and Harry Byrd, Sr.
  Here is the letter that Harry Byrd, Sr., wrote to the lady, in 
response, dated September 18, 1947:

       Mrs. Dorothea Moses, Salem.
       My dear Mrs. Moses: I just received your letter which I 
     deeply appreciate. This is the first time I have ever been 
     offered 10 cents apiece for my apples.
       I am gratified by the sense of honesty which prompted you 
     to send me payment for the apples which, however, I herewith 
     return with the hope that you enjoyed them, although I fear 
     they were not ripe enough for eating purposes. But best 
     wishes, I am faithfully yours, Harry Byrd, Sr.

  Mr. President, I think that was a remarkable letter from a very 
remarkable United States Senator, one whom I admired a great, great 
deal. I think this was a remarkable constituent, who, upon returning to 
her home in Baltimore, MD, decided she ought to pay for the few apples 
that her children and she had picked up off the ground. The letter 
speaks for itself.
  So, I am going to take the liberty of providing this correspondence 
to Harry Byrd, Jr., for whom I have an admiration equal to the 
admiration I had for his father.
  I think that this is a pretty remarkable story, and I am sure that 
Harry Byrd, Jr., will enjoy reading this letter from a bygone age when 
people were honest, although they were poor, and felt that they ought 
to make a remittance even when apples were picked up off the ground of 
the orchard's owner. How that must have thrilled Harry Byrd, Sr., to 
receive that kind of letter from that honest woman.
  Mr. WARNER. Mr. President, I thank my distinguished colleague for 
telling that story. I have always been heartened in this institution 
and this body by the manner in which the senior Senator from West 
Virginia has always invariably paid great respect to his former 
colleagues,
 and particularly the rendition of stories. If my colleagues will 
indulge me for a brief story. I think of the time I met Harry Byrd, Sr. 
My family had interest in property very near the Byrd home, which is in 
Berryville, VA. I own a farm now that has sort of been in my family one 
way or another--I have owned it now 30-some odd years. It is in White 
Post, which is just a few miles from the Byrd orchards.

  On my farm are orchards. And, indeed, for some period of time, Harry 
Byrd, Sr.'s grandson operated with me the apple orchards. So much for 
that.
  I remember visiting one time in July; it was very hot. But it was an 
annual event where Byrd, Sr. would go to his orchard and invite the 
people from all over the community to come and listen to him talk about 
what occurred in the Congress of the United States. Of course, in those 
early days, the Congress often went home in July. It occurred year 
after year in the same manner.
  He would back up an old apple truck. He would get up on the back of 
the truck and the people would gather under the trees. He always wore a 
white suit. Does the senior Senator from West Virginia remember that 
white suit?
  Senator Byrd had a high-pitched voice. I suppose you might say--and I 
do not mean to denigrate--he had a little bit of a sweep to it, a high 
pitch. You had to kind of lean forward to listen, but you could hear 
it. I was just a young man sitting out there listening with all the 
people.
  It is interesting, his staff were always dressed in dark blue suits, 
so you could see the white suit among the dark ones. Then there were 
all the folks who worked in the orchards who had on the bib overalls, 
and the farmers would come from miles around. They would bring a picnic 
lunch. They wanted to hear this speech.
  He did the same thing every year. He would bring down a copy of the 
budget, the budget document. It would be down on the ground, and he 
would say, ``Young man, put the budget document up on the rear of the 
truck here, right up here on this little podium so I can tell the 
people about it.''
  And the young man would reach down and he could not lift it. He would 
say, ``It will take two young men to raise the budget,'' and sure 
enough, eventually it would get up on the apple crates. He just used 
the old apple crates. He put that budget down, and he would start 
orating about the excessive spending in the United States and would go 
page after page after page after page, saying each page is hundreds of 
thousands of dollars, and we would all listen in absolute silence.
  The Byrd family, senior and junior, without parallel in this 
institution, stood for fiscal responsibility of the United States of 
America. This brief statute which was enacted by the Congress of the 
United States on two occasions, which is binding, shall ever remain a 
hallmark to father and son and their fiscal responsibility.
  Mr. President, I thank my distinguished colleague.
  Mr. BYRD. I thank the distinguished Senator.
  Mr. President, I have received a copy of a resolution enacted by the 
Legislature of West Virginia, Senate Concurrent Resolution No. 16. The 
resolution requests that the Congress provide information with respect 
to this constitutional amendment to balance the budget, which will 
indicate what actions will be taken by the Congress in order to achieve 
a balanced budget, if this amendment is adopted. In other words, the 
West Virginia legislature asserts a ``right to know.''
  I ask unanimous consent that the resolution be printed in the Record.
  There being no objection, the resolution was ordered to be printed in 
the Record, as follows:

                         State of West Virginia

                  Senate Concurrent Resolution No. 16

            (By Senators Tomblin, Mr. President, and Chafin)

       Urging Congress to provide full information about the 
     effect of a proposed balanced budget amendment on the people 
     and government of West Virginia before submitting it to the 
     Legislature for ratification.
        [[Page S3123]] Whereas, The constitution of the United 
     States of America is the most perfect example of a contract 
     between a people and their government; and
       Whereas, The congress of the United States is currently 
     considering an amendment to the constitution, known as the 
     ``Balanced Budget Amendment''; and
       Whereas, The House of Representatives has already approved 
     its version of such a balanced budget amendment; and
       Whereas, The House of Representatives approved its version 
     without obtaining a projection of how it would be 
     implemented; and
       Whereas, The House of Representatives rejected a version of 
     the balanced budget amendment, offered by Representative Bob 
     Wise of West Virginia, that would have protected against cuts 
     in social security and would have allowed for both a capital 
     and operating budget; and
       Whereas, The proposal for a balanced budget amendment is 
     now under active consideration in the United States Senate; 
     and
       Whereas, United States Senators Robert C. Byrd and John D. 
     Rockefeller IV of West Virginia have called for a ``right to 
     know'' provision so that the senators would know before they 
     vote how a balanced budget would be achieved; and
       Whereas, The treasury department of the United States has 
     projected that a balanced budget amendment implemented by 
     across-the-board cuts would reduce federal grants to West 
     Virginia state government by $765 million dollars, requiring 
     the Legislature to increase state taxes to compensate for 
     such losses or eliminate the programs and services currently 
     provided to our citizens by federal funds; and
       Whereas, Many citizens of West Virginia would likely suffer 
     from cuts imposed to meet the requirements of the proposed 
     balanced budget amendment, including thousands of our 
     citizens who receive social security, veterans benefits, 
     medicare, medicaid and other essential benefits; and
       Whereas, Through the efforts of Senator Robert C. Byrd and 
     other members of our congressional delegation appropriations 
     have been made for numerous projects in West Virginia, 
     including completion of the Appalachian corridor highway 
     system, relocation of the federal bureau of investigation 
     center to West Virginia and a myriad of other projects; and
       Whereas, These benefits and projects are vital to the 
     economic development and well being of the people of our 
     state and deserve to be protected if the constitution is 
     amended to require a balanced budget; and
       Whereas, West Virginia receives $1.45 in federal benefits 
     for each dollar in federal taxes; and
       Whereas, On a per capita basis, each man, woman and child 
     receives approximately $2,000 dollars more in benefits from 
     the federal government than he or she pays in federal taxes; 
     and
       Whereas, A proposal to balance the federal budget by 
     returning the programs to the states would mean that West 
     Virginia would be required to either raise its taxes by 
     $2,000 dollars for each man, woman and child or eliminate the 
     programs and services currently provided to our citizens by 
     federal funds; and
       Whereas, The balanced budget amendment would be submitted 
     to the Legislature for ratification if approved by the 
     congress; and
       Whereas, This Legislature will be unable to establish its 
     own budget without knowing what reductions will be made by 
     the congress to effect the balanced budget amendment; and
       Whereas, This Legislature therefore has a right to know 
     what effect the proposed balanced budget amendment would have 
     on state government, but more importantly, on the people of 
     our state; therefore, be it
       Resolved by the Legislature of West Virginia:
       That the Legislature recognizes that a balanced federal 
     budget is a desirable objective; and, be it
       Further Resolved, That the Legislature commends the 
     president and the congress for their efforts toward this 
     objective by supporting and enacting legislation that will 
     result in the reduction of the federal deficit for three 
     years in a row; and, be it
       Further Resolved, That the Legislature will be asked to 
     vote for ratification of a balanced budget amendment to the 
     constitution if such a measure is submitted to the states by 
     the congress; and, be it
       Further Resolved, That the Legislature, acting on behalf of 
     the citizens of West Virginia in deciding whether to ratify 
     such an amendment, is entitled to be fully informed of its 
     consequences on our people; and, be it
       Further Resolved, That the congress is hereby urged to 
     submit such an amendment to the States for ratification only 
     if congress provides a detailed projection of what reductions 
     will be made in the federal budget and how these will affect 
     the government and people of West Virginia, including but not 
     limited to, the effect on social security benefits, veterans 
     benefits, medicare, medicaid, education, highway moneys, 
     including completion of the Appalachian corridor system, and 
     other programs necessary for the health and well-being of the 
     people of our state; and, be it
       Further Resolved, That the Clerk of the Senate is hereby 
     requested to forward a copy of this resolution to the 
     president of the United States Senate, the Speaker of the 
     House of Representatives and each member of the West Virginia 
     congressional delegation.

  Mr. BYRD. Mr. President, earlier today, the distinguished senior 
Senator from the State of Tennessee referred to my comments a day or so 
ago when I spoke on the constitutional amendment, with specific 
reference to section 5. The distinguished Senator from Tennessee, I 
think, did not really understand what I said with respect to section 5 
of the constitutional amendment.
  I quote the distinguished Senator from Tennessee [Mr. Thompson]:
  ``He''--meaning this Senator from West Virginia--``He was concerned 
that in times of a declaration of war, the amendment requires a 
constitutional majority of 51 Senators.''
  Of course, that is not the case. As I understand section 5, it does 
not require a constitutional majority of 51 Senators to declare war. 
The able Senator from Tennessee clearly misunderstood what I said--he 
must have. And so I let it go at that, because the amendment certainly 
does not require that. Section 5 of the amendment does not require a 
constitutional majority of 51 Senators to declare war and I never so 
stated, unless I was misquoted.
  Going on, the senior Senator from Tennessee said: ``He,'' meaning the 
Senator from West Virginia,

       He thought that hurdle was too high because normally 
     without the amendment, on most votes around here it is the 
     majority of those present with the Vice President casting a 
     tie-breaking vote if called upon.

  I continue to quote the words of the Senator from Tennessee:

       As I listened to that debate, it is very interesting, the 
     possibilities are intriguing from an intellectual standpoint. 
     Sitting and listening to Senator Byrd of West Virginia is 
     like sitting in a good class of constitutional law. I enjoy 
     it. If we did not have a Senator Byrd, we would need to 
     invent one because he brings issues to the floor and to the 
     table that need to be discussed. But again, does this not 
     assume that 50 Senators plus the Vice President would do the 
     right thing? He--

  meaning Senator Byrd from West Virginia--

       He is concerned we might not get that vote.
       Here we are, we need to declare war and we might not get 
     the 51 votes. So he--

  meaning Senator Byrd.

     assumes, I suppose, that 50 Senators plus the Vice President 
     would do the right thing and we would get the 51 votes that 
     way, but under this amendment that 51 Senators would not do 
     the right thing.
       Now, is that not slicing it a little thin in light of what 
     we are dealing with here? Is that not belaboring the point? 
     It needs to be discussed. But is that what this is going to 
     turn on, whether or not we have 50 Senators plus a Vice 
     President, on the one hand, or 51 Senators on the other?
       I must say, Mr. President, it is my opinion that there are 
     enough good people in this Chamber that if we have the kind 
     of situation that requires a declaration of war, we would do 
     the right thing, that we would do the right thing when the 
     circumstances arose.

  Mr. President, the Senator from Tennessee misunderstood the direction 
and the thrust of my remarks. I was not saying that under the balanced 
budget amendment, a majority of the whole number present would be 
needed to vote for a declaration of war. I did not say that at all, and 
the amendment does not say it. Either Mr. Thompson misunderstood me or 
he misunderstands the verbiage in section 5.
  It is an honest mistake on his part, but I thought I should set the 
record clear. I am not under any illusions that the amendment requires 
51 Senators to vote to declare war. It does nothing of the kind. A 
simple majority of those Senators voting, a quorum being present, is 
sufficient to adopt a declaration of war, both now and under the 
amendment.
  The thrust of my concerns went to the second portion of that 
amendment, which did not deal with a declaration of war but, rather, 
dealt with the situation in which a military threat to our Nation's 
security might exist; in which case, in order to lift the strictures of 
the constitutional amendment that is being debated, a majority of the 
whole number of Members of both Houses would then be required--in which 
case, I took the position that the minisupermajority requirement could 
put our Nation in further peril and also have the effect, if he should 
cast a vote in a tie situation, of negating that Vice President's vote, 
the Vice President not being a Member of the Senate. So much for that.
   [[Page S3124]] Mr. President, let us take a look at what may be in 
store for the Nation should the amendment be drafted into the 
Constitution; namely, that the amendment may be enforced. I see 
problems with the amendment, which I have mentioned to some degree 
earlier and which I shall refer to here again briefly. The problem with 
the amendment, if it is enforced, is that it creates very serious 
problems. If it is not enforced, on the other hand, it still creates 
serious problems.
  Suppose at the end of the second fiscal year following the 
ratification of the amendment, the Office of Management and Budget 
announces that the total outlays for the United States will exceed 
total receipts for that year by, say, $50 billion. Suppose further, 
that the President is advised by White House counsel and the Director 
of the Office of Management and Budget that he is obligated by the new 
amendment to take whatever action is necessary to bring the outlays 
into line with the receipts.
  Suppose he is exhorted by his advisers to use a line-item veto, even 
though the Constitution under which we have operated for over 200 years 
does not give him that authority. He could be prevailed upon by his OMB 
director and others to assume that the new amendment to the 
Constitution inherently gives him the authority to take whatever action 
is needed to bring the budget into balance, to make outlays balance 
with the receipts.
  What will happen to the outlays of the various departments? Will 
defense contracts be held up? If moneys are impounded by the President, 
or if a line-item veto authority, which he does not have today under 
the original Constitution, should be assumed, or enhanced rescissions 
authority, which is worse than the line-item veto, were to be assumed, 
will checks to people who are unemployed be withheld? Will Medicare 
payments be stopped? Will Medicaid be cut back? Will Social Security 
checks be put on hold? Will the President impound moneys that have been 
mandated by the Congress to be spent, even though he would be acting in 
violation of the 1974 Budget and Impoundment Control Act? This sounds 
like a sure prescription for an Imperial Presidency.
  The President, any President, could feel the compulsion to obey the 
mandate ``implicit'' in the Constitution as amended by this balanced 
budget amendment, believing that it contained inherent authority to 
exercise enhanced revisions authority, line-item veto authority, and 
impoundment authority, and he would be certainly advised by his 
counsel, I should think, to proceed to reduce outlays, thus sharing the 
power over the purse that is currently vested in Congress by article I 
of the Constitution, article I, section 8, the power that is given to 
the Congress to raise revenue, and by section 9 of article I to 
appropriate money. He would believe himself to be authorized to cut 
whatever programs and projects he chose to cut while leaving untouched 
those projects he supported. By holding programs and projects hostage, 
he would be in a position to suspend a Damocles sword over the heads of 
Senators and Representatives with respect to projects and matters 
important to their States and districts.
  Moreover, he could use this leverage to bring legislators into line 
on matters other than those affecting the budget. Confirmation votes on 
future Clarence Thomases could bring tremendous pressure on Senators by 
such enhanced Presidential powers. He could threaten this or threaten 
that, and I, as a Senator, might or might not buckle under that 
pressure. I have had pressures from Presidents, like Lyndon Johnson, 
who really knew how to twist arms. It was pretty hard to say no to a 
President who, like Lyndon Johnson, was the former majority leader of 
this Senate, who had much to do in those days with putting me on the 
Appropriations Committee, but I said no. What it meant was about 30 
minutes of excruciating torture, after which I felt that my clothes 
needed washing and drying. I felt that I had been put through a clothes 
wringer.
  Confirmation votes on future Clarence Thomases or future treaty votes 
would be a President's to collect, merely by threatening to line-item 
veto or impound monies concerning programs supported by certain Members 
of Congress. A President could also use this power effectively with 
respect to cutting capital gains taxes or achieving other cherished 
goals.
  I suggest, if any Senator is interested in reading about one of those 
arm-twisting sessions that I had with the late President Lyndon B. 
Johnson, the Senator read from the second volume of my history on the 
United States Senate, 1789 to 1989. It is all laid out there.
  The road would be paved for the courts then--get this--to get into 
the act of balancing the budget. Beneficiaries of programs arbitrarily 
cut back by the President's actions could go into the courts and demand 
that the cuts be restored, and the claimants of such payments could 
very well, in some circumstances, at least, establish standing to sue.
  If the courts concluded that it was necessary to impose a tax in 
order to bring receipts up to the level of outlays, the taxpayers would 
have standing to apply for relief. And if ever there could be a 
lawyers' paradise, the millennium would be here.
  One might denominate this amendment as the constitutional amendment 
to benefit lawyers. In saying that, I do not speak with any disrespect 
toward lawyers. I would prefer to call it the constitutional amendment 
for minority rule. I may have more to say on that at another time.
  Montesquieu, in his ``Spirit of the Laws,'' stated, ``of the three 
powers . . . the Judiciary is next to nothing.'' Meaning of the three 
powers: The executive, the legislative and the judiciary. Montesquieu 
said, ``of the three powers . . . the Judiciary is next to nothing.'' 
He also said, ``There is no liberty, if the power of judging be not 
separated from the legislative and executive powers.''
  Hamilton agreed with Montesquieu in the Federalist Paper, Number 78, 
wherein Hamilton went on to state: ``The executive not only dispenses 
the honors but holds the sword of the community. The legislature not 
only commands the purse, but prescribes the rules by which the duties 
and rights of every citizen are to be regulated. The judiciary, on the 
contrary, has no influence over either the sword or the purse . . . The 
judiciary is beyond comparison the weakest of the three departments of 
power.'' That was Hamilton.
  The amendment on which we are about to vote within the next few days 
would turn Montesquieu's and Hamilton's world topsy-turvy, upside down. 
The judiciary could become the strongest of the three departments of 
government and thus hold influence over both the sword and the purse. 
Constitutional government as we have known it for over 200 years, based 
upon the separation of powers and checks and balances concepts, would 
perish from the Earth.
  That is one course that we may find ourselves travelling.
  The Peoples' Branch would atrophy. Representative government would no 
longer exist. Unelected members of the courts would wield the power of 
the purse. The Constitutional mandate, section 9 of article I of the 
Constitution, that ``no money shall be drawn from the Treasury, but in 
consequence of appropriations made by law,'' would be changed, and, 
instead, we would be treated to the spectacle of appropriations made by 
judicial fiat.
  The American people fought one revolution over the principle of 
``taxation without representation,'' and now we are about to vote on an 
amendment to the Constitution which could easily result in unelected 
judges mandating higher taxes--judges who are appointed for life 
mandating higher taxes. If we think the people would be upset with 
Congress for increasing their taxes, just imagine what their feelings 
will be when their taxes are hiked by unelected judges who are 
appointed with life tenures. Could we be sowing the seeds for another 
revolution by adopting this amendment? If there were ever a Pandora's 
box with evils imprisoned therein to bring misfortune to our country, 
this would surely be it. If the amendment is enforced, the powers of 
the legislature will flow to the executive and to the judiciary, and we 
will have destroyed a government of separation of powers and checks and 
balances.
  Contemplate that, for 200 years--206 years, our Nation has operated 
under 
[[Page S3125]]  the Constitution that was written by the illustrious 
Framers in Philadelphia in 1787, and that, by the adoption of this 
amendment and by its subsequent ratification by the States--if the 
States do ratify it in the requisite number as set forth in the 
original Constitution--we will have destroyed, I think, the 
constitutional form of Government that our forefathers gave us. It will 
certainly be in danger, great danger. So the handiwork of the Framers 
will finally have been ill served.

       I saw them tearing a building down,
       A group of men in a busy town;
       With a ``Ho, heave, ho'' and a lusty yell,
       They swung a beam and the sidewall fell.
       I said to the foreman, ``Are these men skilled
       The type you'd hire if you had to build?"
       He laughed, and then he said, ``No, indeed,
       Just common labor is all I need;
       I can easily wreck in a day or two,
       That which takes builders years to do.''
       I said to myself as I walked away,
       ``Which of these roles am I trying to play?
       Am I a builder who works with care,
       Building my life by the rule and square?
       Am I shaping my deeds by a well-laid plan,
       Patiently building the best I can?
       Or am I a wrecker who walks the town,
       Content with the labor of tearing down?"

  Mr. President, the lines from The Masonic Craftsmen are well 
descriptive of the situation if this balanced budget amendment is ever 
nailed into the original Constitution as an amendment. I shudder to 
think that that prospect may very well be close at hand.
  If, on the other hand, the Constitutional provision is not enforced, 
we will have made the Constitution promise something that it cannot 
fulfill, and it will henceforth become a mere piece of paper, relegated 
to the dustbin of history.
  What will actually happen in the event of the adoption and 
ratification of a balanced budget amendment to the Constitution remains 
to be seen.
  Nobody knows. I do not know precisely what will happen. I have 
outlined two very sad prospects--one if the amendment is enforced, the 
other if it is not enforced--as to what may be in the offing in the 
event this constitutional amendment were to be adopted and ratified. 
We, of course, cannot be absolutely sure, but why should we take such 
risks? Republican Senators will not tell us how they intend to carry 
out the mandate of the constitutional amendment on the balanced budget. 
I happen to believe that if the amendment is grafted on to the 
Constitution, there will be efforts to enforce it, and this will mean 
that we no longer have a government by the people, but, instead, the 
people will be governed by a black-robed Office of Management and 
Budget, run by one Chief Director and eight associate directors 
appointed for life, with control over both the sword and the purse.
  There will be no rams' bellies by which we may ride out of that 
dilemma, as Odysseus did when he and his companions escaped from the 
cavern of Polyphemus.
  In escaping from that cavern, Odysseus instructed his companions to 
hold onto the bellies of the rams as they went out of the cave to 
graze, Polyphemus, the chief of the Cyclopes, having been blinded by 
the fire of a piece of wood that Odysseus had plunged into the giant's 
eye. They escaped by holding onto the bellies of the rams.
  The giant laid his hands on the tops of the rams as they went out of 
the cave. He never thought to feel under the bellies.
  Odysseus and his remaining few companions--those that had not ended 
up in the stomach of Polyphemus--had found a way to escape by holding 
onto the rams' bellies. Well, Senators, we will not have any rams' 
bellies here by which we may ride out of this dilemma. And unlike 
Odysseus in Homer's epic, while we may be able to escape the violent 
whirlpool of Charybdis, we will still be devoured by Scylla, except, 
unlike Homer's Scylla, which had 12 legs, and 6 hideous heads bearing 3 
rows of teeth each, ours will be a monster with 18 legs, and 9 heads 
bearing 2 rows of teeth each. Ours will no longer be a government of 
laws; instead, it will become a government of judicial fiats. Is this 
what Washington and his starving men at Valley Forge fought for? Was it 
for this that Americans shed their blood at Lexington and Concord, and 
at Saratoga? Was this what Nathan Hale had in mind when he gave the 
only life he had for his country? Did our forefathers pledge their 
lives, their fortunes, and their sacred honor to throw off the 
tyrannical hand of George III, only to be ruled by the heavy hand of a 
judicial oligarchy?
  Mr. President, when the Constitutional Convention had completed its 
work in 1787, Benjamin Franklin, one of the Framers of the great 
document, was approached by a lady who asked the question, ``Dr. 
Franklin, what have you given us?'' Franklin answered, ``A republic, 
madam, if you can keep it.''
  Mr. President, this amendment carries the seeds for the destruction 
of the American Constitutional republic as it was handed down to us by 
our forefathers. I say it carries the seed of destruction. I am 
concerned about the future of this Republic. And there are Members on 
both sides of the aisle who are going to vote for this amendment, come 
next Tuesday, who have expressed to me privately their serious doubts 
with regard to the balanced budget amendment.
  I know of no magic herb by which we may prove ourselves invulnerable 
to the seductive charms of this ``quick-fix'' amendment. I can only 
hope that Members will fill their ears with wax so that they will not 
be lured by the siren's song and will ignore the pleas until the danger 
is safely past.
  Each of us upon being elected to the office of Senator subscribes, by 
oath or affirmation, to support and defend the Constitution of the 
United States. It is a solemn oath. We do not swear before God and man 
that we will support and defend a political party. We do not swear that 
we will support and defend a so-called Contract With America, but only 
that we will support and defend the Constitution of the United States.
  Of course, we all understand that the Constitution provides a 
process, in Article V, for its own amending, and while I, or any other 
Senator, may be willing to amend the Constitution in one particular or 
another, what we have here is an amendment which, for all intents and 
purposes, could result in the destruction of a government of checks and 
balances, a government of separation of powers. We are, therefore, 
talking about the very bottom bedrock of our Constitutional form of 
government. Take away the checks and balances, which could be the 
result of this amendment; take away the separation of powers, which 
could be the result of this amendment; then we will no longer have a 
government of the people, by the people, and for the people. We will 
have a government of three branches, in which the peoples' branch, the 
legislative, will become a mere vestigial leftover from a bygone day, 
shorn of its power over the purse and no longer able to fulfill the 
functions for which it was created.
  Make no mistake about it. Senators will never be able to wash this 
stain from their hands.
  Mr. President, I am not assured by those Senators who say that we can 
avoid the intrusion by the courts into the realm of budget making, 
simply by resorting to the provision that allows a three-fifths vote to 
approve a specific excess of outlays over receipts. I am not sure about 
that at all. Most of those who support this provision are among those 
Senators and Representatives who will never vote for a tax increase, 
come what may.
  I do not like to vote for a tax increase. That is not an easy vote. 
But there come times when we have to have an increase in taxes. If we 
ever really bring these budget deficits under control and begin making 
payments on the principal of the debt, I have no doubt that there are 
going to have to be some revenue increases. Yet, there are Senators who 
say they will never vote for a tax increase. They will always depend 
upon someone else to supply the three-fifths of the whole number of 
each House.
  What this really is, is a prescription for minority rule. Ours would 
become a government by minority. That is minority rule--no ifs, ands, 
or buts about it. Are two-thirds of the Members of this Senate ready to 
submit themselves to such a stultifying prospect?
  We are all deeply concerned about the budget deficits, the national 
debt, and the growing interest on that national debt. I want to see our 
budget deficits brought down. I want to see our budget brought into 
balance, especially in those years when we do not have to have a budget 
deficit in order to deal with an economic decline in the 
[[Page S3126]]  economy, or an ongoing recession. I want to see our 
budget brought into balance as much as does any other Senator. Every 
Senator in this body wants to see these deficits brought under control.
  A national debt rapidly approaching $5 trillion, and with the sky as 
the limit if we do not do something to curtail it, is a terrible legacy 
to leave to our children. We have to do something about it, and it will 
be painful. It may require us to increase taxes. But it will be an even 
more awesome legacy to leave to our children and grandchildren, if we 
destroy the foundations of our constitutional system of checks and 
balances, sweep away the peoples' power over the purse exercised 
through their elected representatives in Congress, and undermine the 
faith of the Nation in the Constitution itself.
  I hope that we will ponder this constitutional amendment over this 
weekend as we have never thought about it before. I have heard many 
comments from people on the outside--for example, from representatives 
of the media--about this debate. Those comments have been favorable 
with respect to the fact that the Senate has indeed taken the time to 
study the amendment, to debate it, to deliberate, and to try to correct 
what many of us see as flaws in the amendment.
  I believe that was the role that the forefathers intended for the 
Senate to play. This constitutional amendment to balance the budget was 
adopted in the House of Representatives after only 2 days of debate. 
That is appalling. That is an appalling spectacle--to have a 
constitutional amendment adopted in the other body after only 2 days of 
debate! But in the Senate, come next Tuesday, it will have been before 
the Senate for 30 days. I thank the majority leader, and I compliment 
him for the respect he has thus far shown for the fact that this is a 
constitutional amendment, and that this is the United States Senate, 
and that this is the role that the United States Senate was supposed to 
play. That was the role the Framers had in mind from the very 
beginning--that the Senate would be a deliberative body. Many times we 
do not deliberate much here anymore. But in this situation, there has 
been considerable deliberation.
  I think that the Framers would be pleased that this Senate has at 
least slowed down a stampede to enact this constitutional amendment in 
a hurry. There have been efforts to amend it, but we have failed thus 
far. I do hope, however, that the amendment that is being offered by 
Senator Nunn will be agreed to next week. Senator Johnston's amendment 
was rejected on a tabling motion. Senator Nunn's amendment is different 
only in a slight respect from the amendment that was offered by Senator 
Johnston. I hope that the amendment by Senator Nunn will be adopted. It 
addresses that very serious and solemn and terrible prospect that the 
courts might intervene if this amendment were to be adopted and 
enforced. There is nothing in the balanced budget amendment that either 
invites or forbids the courts to enforce this amendment.
  I intend to support Senator Nunn's amendment. I am not sure that even 
his amendment will provide all of the answers, because much is left to 
the implementing legislation that the Congress will be authorized to 
write to enforce the balanced budget amendment. The implementing 
legislation may itself carry many seeds for the destruction of the 
constitutional system of checks and balances and separation of powers 
that we have known for 206 years.
  Implementing legislation might not even be passed. After all, such 
implementing legislation has to go to the desk of the President. A 
President may veto it in a given situation. It would require two-thirds 
of both bodies to override his veto. Or the implementing legislation 
that is enacted in one Congress may be amended in a subsequent 
Congress. Even the amendment by Mr. Nunn does not protect us--when I 
say us, I mean the public--from events which could very well create 
chaos in the economy and change the constitutional form of government 
that has served the American people so well. Power could still flow 
from the legislative to the executive branch.
  But at least, Senator Nunn's amendment addresses itself to one of the 
possible dangers, and it really goes to show that this balanced budget 
amendment is very much like a balloon. If you squeeze the balloon at 
one end, it pops out bigger on the other. If you squeeze at that end, 
then it pops out and makes the balloon larger in another place. If we 
cure one flaw here, we open up other flaws. That just goes to show that 
this ``quick fix'' really cannot be fixed.
  Mr. President, I thank the distinguished Senator from Utah [Mr. 
Hatch] for remaining at his post of duty and listening to my remarks on 
this occasion. He has worked hard on this constitutional amendment. He 
is entitled to a great deal of respect for his efforts to get out of a 
very, very tough and difficult and complex problem. Unless he wishes to 
ask me a question, I will yield to----
  Mr. HATCH. I thank the Senator.
  Mr. BYRD. I have not yielded yet, but I am available if the Senator 
wishes to respond to my words.
  Mr. HATCH. If the Senator will yield, I want to compliment the 
Senator. I have seen him work this floor very faithfully, 
intelligently, and I believe honestly throughout this debate. We happen 
to differ. I believe that when you press a balloon on one end, it 
expands on the other end, and when you press it on the other top, it 
expands on the bottom. But it still contains the future of our country. 
I also believe that the distinguished Senator, as sincere as he is--and 
he is sincere, and I know that; he has my respect--is saying that this 
amendment leads us into a lot of difficulties. But I have to say that 
we are in a lot of difficulties.
  Mr. BYRD. I did not hear the Senator.
  Mr. HATCH. I say we are in a lot of difficulties. Many of us feel 
that though this bipartisan consensus amendment is not perfect in 
anybody's eyes, that it is the most perfect we can do, and that it is 
the only way we are going to get spending under control in this 
country. But I think the distinguished Senator from West Virginia has 
been eloquent throughout this debate. He has been constitutionally apt 
in many respects. And although I differ with him on some of the 
interpretations, I compliment him for his knowledge, his foresight and 
his own explanations of how the Constitution is considered.
  It is to me, too. I feel very, very deeply about it. I feel deeply 
about my dear colleague's point of view. I do not have any desire to 
prolong this this evening, but I just want to compliment the Senator 
for his comments, for his hard efforts, for his willingness to be on 
this floor and to do what he has done with the amendments he has 
brought forward and the intelligent way in which he has discussed them, 
and for the courteous manner and kindness shown. I really personally 
appreciate it.
  I did not think my esteem could be any higher than it is for the 
Senator. But it is. It is higher.
  Mr. President, I just want to say in closing here this evening, I 
would like to shut the Senate down, but I understand the Senator from 
Maryland wants to speak. I would like to get the floor as soon as the 
Senator from West Virginia is through so I can get legislative matters 
straightened out here.
  Mr. BYRD. I am about to yield the floor if the Senator does not wish 
to ask any questions.
  Mr. HATCH. I do not.
  Mr. BYRD. I appreciate his kind comments. They are very sincere.
  Mr. HATCH. It never, never ceases to amaze me how the Senator can 
just call up poetry like he did here this evening, and a wealth of 
knowledge about history and especially the history of the Senate.
  I have to say I was moved by the distinguished Senator's discussion 
of the Harry Byrd letter and Mrs. Moses' letter. I think what the 
Senator does in bringing things like that to the attention of everybody 
perpetuates the importance and the feelings and the basic goodness of 
the Senate.
  Mr. BYRD. As the Senator knows, ``I'll cavil on the ninth part of a 
hair,'' and ``I'll fight till from my bones my flesh be hack'd.''
  Sometimes I think we probably overdo the expressions of affection in 
this body. However, I do appreciate the kind words the Senator has 
expressed. I had hoped we might, even at this late hour, engage in 
debate. But I do not 
[[Page S3127]]  want to insist on it. I will close my remarks with 
respect to our mutual affection. The Senator knows that, for him ``my 
affection hath an unknown bottom, like the Bay of Portugal.''
  Let us hope that on next Tuesday Senators will remember the words of 
Lord Nelson, who lost his life in the Battle of Trafalgar. His last 
words were, ``Thank God, I have done my duty.''
  Mr. HATCH. Mr. President, I have to confess that I believe that the 
distinguished Senator from West Virginia always does his duty. I 
personally appreciate it, even when I disagree.
  Mr. President, the Senator from West Virginia has presented us with 
the triple threat from the balanced budget amendment of: First, an 
imperial Presidency; second, an all-powerful judiciary; and third, the 
seeds of revolution. Possibly, he suggests, the Constitution itself 
will be relegated to the dustbin of history.
  This is strange indeed given that the amendment itself gives Congress 
the power and duty to enforce and implement the balanced budget 
amendment.
  I would ask what continuing on the path we are on would do to the 
Constitution or the Nation. If President Clinton's predictions are 
correct that the generation that is beginning now will be taxed at the 
net tax rate of 82 percent that all will be tranquility? Or will we see 
tax revolts that will make the Boston Tea Party look like a Beacon Hill 
high tea. What does taxation without representation mean if not leaving 
mammoth taxes to generations who cannot vote yet?
  And what will happen to a republic with national debt growing at the 
rate it is now indefinitely? Ask Argentina, Italy--some point to Weimar 
Germany as a model of the inflation and the economic and political 
chaos that could ensue from our path of profligate spending.
  Mr. President, the bottom line is a choice between doing what we are 
doing now and changing the way Washington does business. I have heard 
some on this floor say that this amendment would not pass if we could 
vote in secret. Well, that is precisely the problem, the problem that 
the voters asked us to fix last November.
  I have explained repeatedly during this debate why this amendment 
would not involve the courts in activity infringing on the powers 
granted to Congress in article I of the Constitution.
  This balanced budget amendment indeed contains the seeds of 
liberation for the rising generation and generations yet unborn. It 
contains the seeds of liberation from the shackles of insupportable 
impossible debt and oppressive taxation--the seeds of liberation from 
an increasingly unresponsive but increasingly intrusive Federal 
Government. The balanced budget amendment contains the seeds of 
liberation from a government which consumes tomorrow's wealth to 
satisfy today's desires.
  Mr. President, let us adopt the balanced budget amendment to continue 
the principles of the American Revolution and Constitution, the 
principles of freedom--political and economic--for future generations 
of Americans.
  Does the Senator from Maryland want to speak?
  Mr. SARBANES. Mr. President, I would like to speak for probably 5 to 
10 minutes. There were some points made earlier in the day I would like 
to respond to.
  Mr. President, I thank the Senator from Utah for his courtesies.
  Mr. President, I want to address the point about the danger that the 
balanced budget amendment might well do to our economy in time of an 
economic downturn.
  I think this point very much needs to be emphasized. In fact, there 
was an article in the New York Times only a day or two ago that was 
headed, ``The Pitfalls of a Balanced Budget, Dismantling a Decades-Old 
System for Softening Recessions.''
  In the course of that article it is stated ``If the amendment is 
enacted, the side effect would be huge. A system that has softened 
recessions since the 1930's would be dismantled.''
  Now, I want to just point to this chart and then I want to quote a 
couple of highly respected economic thinkers in our country. What this 
chart shows is the change in real GDP beginning back in the late 1800's 
and coming forward until today.
  What this chart shows is there were tremendous fluctuations in the 
economy until the post-World War II period. The economy would, in the 
late 1800's and the first half of this century, go, as one can easily 
see, up and down like a roller coaster, often going very deeply into a 
negative growth situation.
  These are the boom and bust cycles that those who have read American 
history are familiar with. These were the panics. What happened is, 
after the Great Depression, as a consequence of the Great Depression, 
we began to change our thinking and to develop what are called 
automatic stabilizers. I will elaborate on that in a moment as to what 
that means. But the consequence of doing that was to markedly change 
the depth of the business cycle. As we can see, since World War II, 
although we continue to have fluctuations in the economy, we no longer 
have the very deep plunges into very significant negative growth.
  Now, Charles Schultze, whom all of us know and who is a highly 
respected economist, stated a couple of years ago in testifying about 
the then-balanced budget amendment proposal that was before the 
Congress:

       A Balanced Budget Amendment Would Be Bad Economics. Federal 
     revenues automatically fall and expenditures for unemployment 
     compensation rise when recessions occur. The deficit 
     necessarily rises. This budgetary behavior is a very 
     important economic stabilizer. It helps sustain private 
     incomes during recessions and thus keep sales, employment, 
     and production better maintained than they otherwise would 
     be.

  Now, I just want to comment on this. It is very important to 
understand that, as we go into a recession, we automatically start 
running a deficit because we lose tax revenues. People have lost their 
jobs. They are unemployed. So we have less revenues coming in. And we 
start making payments out of the Treasury--unemployment benefits, food 
stamps, medical care--and the combination of that means that the 
deficit grows, but that helps to offset the downward momentum.
  Now, what we used to do in the old days, we would try to balance the 
budget in that circumstance when the economy was going soft, we would 
try to balance the budget and, of course, that would only drive the 
economy even further down.
  So, as Mr. Schultze stated and I just repeat it:

       Federal revenues automatically fall and expenditures for 
     unemployment compensation rise when recessions occur.
       The deficit necessarily rises. This budgetary behavior is a 
very important economic stabilizer. It helps sustain private incomes 
during recessions and, thus, keep sales, employment and production 
better maintained than they otherwise would be.

  And he goes on to say:

       The American economy in the postwar years has been far more 
     stable than it was between the Civil War and the Second World 
     War, even if we exclude the Great Depression from the 
     comparison.

  Now this is exactly what this chart shows, although it does not go 
back quite as far as the Civil War. But clearly what this chart 
demonstrates, as Mr. Schultze states, is that the American economy in 
the postwar years has been far more stable than it was between the 
Civil War and the Second World War. You can see the tremendous 
fluctuations we used to have in the economy as compared to what has 
occurred since World War II.
  Mr. Schultze goes on to say:

       In the period between the Civil War and the First World 
     War, the American economy spent about half the time in 
     expansion and half in contraction. In the period since 1946, 
     the economy spent 80 percent of the time expanding and only 
     20 percent contracting. In the years after the Second World 
     War, fluctuations in the American economy around its long-
     term growth trend were only half as large as they were in the 
     period 1871 to 1914. Many people who have studied the period 
     credit an important part of the improved economic performance 
     to the automatic stabilizing characteristics of the Federal 
     budget.
       Under the constitutional amendment proposed in H.J.Res. 
     268--

  Which was the proposal at the time, the counterpart to what is before 
us now--

     this stabilizing force would be seriously threatened. The 
     first year of a recession would turn an initially balanced 
     budget into 
     [[Page S3128]]  deficit. But under the proposed 
     constitutional amendment, Congress would be required to bring 
     a budget for the next year back into balance by large tax 
     increases or spending imposed as the recession was still 
     underway.

  Of course, imposing those tax increases or spending cuts, in order to 
eliminate the deficit which the onset of the recession had brought 
about would, of course, only make the recession worse. They would drive 
the economy even further down, as these tremendous negative growth 
periods which occurred in the first part of this century clearly 
indicate.
  This is not a desirable economic performance, and the automatic 
stabilizers, which we have run in the postwar period, have enabled us 
to avoid that. While we have had ups and downs in the economy, they 
occur almost entirely in the positive growth area. We do not have the 
deep plunges into negative growth which marked economic performance in 
the first part of this century and, indeed, ever since the economy 
became, as it were, a complicated, complex modern economy. So if we had 
gone back to the Civil War, we would have had these movements up and 
down as well.
  Laura Tyson, in an article in the Washington Post--and I ask 
unanimous consent that that article be printed in the Record at the end 
of my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See Exhibit 1.)
  Mr. SARBANES. It is entitled ``It's a Recipe for Economic Chaos.''

       Continued progress on reducing the deficit is sound 
     economic policy, but a constitutional amendment requiring 
     annual balance of the Federal budget is not.

  Let me repeat that because I agree very strongly with it.

       Continued progress on reducing the deficit is sound 
     economic policy, but a constitutional amendment requiring 
     annual balance of the Federal budget is not. An economic 
     slowdown automatically depresses tax revenues and increases 
     Government spending on such programs as unemployment 
     compensation, food stamps, and welfare. Such temporary 
     increases in the deficit act as automatic stabilizers 
     offsetting some of the reduction in the purchasing power of 
     the private sector and cushioning the economy's slide.
       Moreover, they do so quickly and automatically without the 
     need for lengthy debates about the state of the economy and 
     the appropriate policy response.
       By the same token, when the economy strengthens again, the 
     automatic stabilizers work in the opposite direction. Tax 
     revenues rise, spending for unemployment benefits and other 
     social safety net programs falls, and the deficit narrows.

  Now, the marked diminution of the fluctuations in the economy shown 
on this chart in the post-World War II period reflects the automatic 
workings of these stabilizers through the business cycle. It 
demonstrates the benefit we have derived from the application of these 
automatic stabilizers in the post-World War II period. This is a 
dramatic illustration of the advantages of having broken out of the 
thinking that said we had to balance the budget every year and, 
therefore, led to efforts to balance it at a time of economic downturn 
which only intensifies the problem.
  Ms. Tyson goes on to say:

       A balanced budget amendment would throw the automatic 
     stabilizers into reverse. Congress would be required to raise 
     tax rates or cut spending programs in the face of a recession 
     to counteract temporary increases in the deficit. Rather than 
     moderating the normal ups and downs of the business cycle, 
     fiscal policy would be required to aggravate them.

  Which is exactly what had been happening in the past, and we now have 
managed to avoid.
  Mr. BYRD. So will not then the chart show for the next several years, 
after the point where we now are, the same chart would show these lines 
that are zigzagging and fluctuating above the horizontal line, it 
would, in effect, show them down here.
  Mr. SARBANES. That is right. You go into a downturn, and instead of 
having these automatic stabilizers to counteract that, the roller 
coaster would start down and you would simply be intensifying it.
  People have to understand, what these downward lines mean, this 
negative growth means millions of people unemployed. This means small 
businesses going into bankruptcy. What these lines mean, in every 
instance in which these occurred, if you went back and looked at what 
was happening in the economy, there was massive economic dislocation: 
People losing their jobs, businesses going into bankruptcy, farms being 
foreclosed. We have not experienced that in recent times and, as a 
consequence, people begin to take it for granted.
  But it is not inevitable.
  It must be understood, one of the reasons it has not happened is 
because we have had a counteracting policy to prevent these deep 
declines from taking place.
  Mr. BYRD. Mr. President, if the Senator will yield.
  Mr. SARBANES. Certainly.
  Mr. BYRD. So the effect then, if I understand what the Senator is 
saying, I think he is making a vital point here, which would be that we 
would return to a situation as the chart indicates for the earlier 
years, going back more than 50 years.
  Mr. SARBANES. The distinguished Senator from West Virginia is 
correct. We would be back into these up and down cycles. As Charles 
Schultze said in his quote, which I think is very important:

       In the period between the Civil War and the First World 
     War, the American economy spent about half the time in 
     expansion and half in contraction. In the period since 1946, 
     the economy spent 80 percent of the time expanding and only 
     20 percent contracting.

  When it did contract, it avoided going into these very deep plunges 
which used to occur. We used to call those ``panics,'' ``busts.'' The 
economy was devastated. You would have the panic of 1893 or the panic 
of 1922, and so forth. And we have avoided that in the post-World War 
II period. We have had some ups and downs; we have what we call 
recessions. We have not had a depression. We have managed to avoid 
that.
  Let me just read what Alice Rivlin had to say today. She is a very 
thoughtful woman, and those who know her realize that she is what is 
called a ``deficit hawk.'' She has been anxious to get the deficit 
down, has worked hard to get the deficit down. Today at a news 
conference she made the following statement:

       This discussion is not about whether the budget should be 
     balanced, on the average. It is about whether we should write 
     into the Constitution that the budget should be balanced 
     every year. No one can fault the Clinton administration for 
     not being serious about deficit reduction; we believe the 
     deficit is too high, that it must come down. We have brought 
     it down a lot; we want to bring it down more.
       But we do not believe that we should write a requirement 
     for balance every year into the Constitution. The real 
     problem with doing that is that it would make swings in the 
     economy bigger.
       The Federal deficit has acted as a cushion that dampen 
     recessions, make them less wide, less bad for people.
       When the economy slows down, two things happen. One is, 
     there are more people who are eligible for unemployment 
     insurance and food stamps and the kinds of things that help 
     people when they are in trouble. So expenditures for those 
     things go up. More importantly, when people earn less and 
     they lose their jobs, they don't pay as much income tax, so 
     the Federal revenues go down.
       With spending going up and revenues going down a lot in the 
     beginning of a recession, what you find is a deficit 
     widening--automatically; it just happens. And automatically, 
     it offsets the horrendous effects of that recession.
       Now, what would happen if you had to counteract that 
     effect? The Constitution would say, unless you had a 
     supermajority to override it, that you would have to do one 
     of two things. You would have to cut spending to correct that 
     deficit, and people would have less income, . . . or you 
     would have to raise taxes, which would mean people would have 
     less income. So the recession gets worse. We would have 
     bigger swings in the economy, a deeper recession.
       Now, that's not just a theory, you can really see it. You 
     can see it in what has happened to recessions over the last 
     couple of decades.
       If you look back in our history, the economy went up and 
     down by huge swings. In the period, especially the period 
     since World War II when these automatic stabilizers have been 
     in effect . . . we've still had recessions, but we have had 
     much smaller ones than we otherwise would have had.
       If we pass a balanced budget amendment to the 
     Constitution--

  And I say to the distinguished Senator from West Virginia this is 
exactly to his point.

       If we pass a balanced budget amendment to the Constitution, 
     we are saying we want to go back to those days when the 
     economy had huge swings, and many more people were out of 
     work in a recession than are out of work in modern 
     recessions.

  [[Page S3129]] Now, Mr. President, this issue is not being given a 
lot of attention in this debate. It is very clear that by having these 
automatic stabilizers in the budget, we have been able to avoid very 
dire economic times.
  This amendment would preclude the automatic response which now takes 
place and which begins to happen before people even begin to recognize 
that the economy may be in trouble. As soon as the economy starts 
experiencing some trouble, this cushioning effect automatically starts 
happening.
  It is asserted by proponents of the amendment that sixty votes to 
waive its provisions would be obtained. 60 votes. Maybe, maybe not. I 
daresay, in any event, you will not come anywhere close to getting them 
until it is manifest that the economy is in difficulty, namely until we 
have moved down the downward curve a considerable part of the way. And 
at that time, of course, you are really playing catch up. You are 
trying to pull back this downward momentum instead of having offset it 
right in the beginning.
  Now, I want to underscore these deep downward lines, on this chart. 
You say, well, this is negative growth, this is GDP taking a nosedive. 
People say, ``Well, what does all that mean?''
  What it means in real human terms, what these deep plunges in growth 
to negative levels of 5, 10 percent, in the Great Depression even 15 
percent, literally means is millions unemployed; it means small 
business bankruptcies the likes of which we have not seen in roughly 
the last 60 years; it means farm foreclosures.
  Now, these are real life problems, and we run an incredible risk with 
the proposal that is before us of going back to that kind of business 
cycle. As the New York Times article said:

       If the amendment is enacted, the side effect would be huge: 
     a system that has softened recessions since the 1930's would 
     be dismantled.
       The problem is that the balanced budget amendment is a 
     heavy-handed solution and risky. The biggest risk is to the 
     Nation's automatic stabilizers which have made recessions 
     less severe than they were in the century before World War 
     II. The stabilizers, an outgrowth of Keynesian economics, 
     work this way: When the economy weakens, outlays 
     automatically rise for unemployment pay, food stamps, 
     welfare, and Medicaid. Simultaneously, as incomes fall, so do 
     corporate and individual income tax payments. Both elements 
     make more money available for spending, thus helping to pull 
     the economy out of its slump. Under the balanced budget 
     amendment, Congress and the administration would be required 
     to get the budget quickly back into balance through spending 
     cuts, higher tax rates, or a combination of the two, perhaps 
     even in the midst of a recession.
      The Government would become almost inevitably a destabilizer 
     of the economy, rather than a stabilizer.

  Now, in economic terms that is the real concern. I have spoken 
earlier about the fact that this amendment does not distinguish between 
a capital budget and an operating budget, and the serious implications 
of that in economic terms and with respect to investing in our future.
  But what I just wanted to come to the floor and address this evening 
at the close of the day--since some question was raised earlier about 
whether policy had worked to counteract the economic cycle--was this 
very graphic description, and these comments which I have quoted by 
some very able people.
  I think this observation of Charles Schultze, I just want to quote it 
again:

       The American economy in the postwar years has been far more 
     stable than it was between the Civil War and the Second World 
     War, even if we exclude the Great Depression from the 
     comparison. In the period between the Civil War and the First 
     World War, the American economy spent about half the time in 
     expansion and half in contraction. In the period since 1946 
     the economy spent 80 percent of the time expanding and only 
     20 percent contracting. Many people have studied the period 
     and credit an important part of the improved economic 
     performance to the automatic stabilizing characteristics of 
     the Federal budget.

  Mr. President, I do not want to go back to the kinds of fluctuations 
in the economy we experienced in the pre-World War II period, and that 
is one of the reasons that I oppose the balanced budget amendment and 
very much hope it will be defeated.
  Mr. President, I yield the floor.
                               Exhibit 1

              [From the Washington Post, February 7, 1995

                    It's a Recipe for Economic Chaos

                       (By Laura D'Andrea Tyson)

       Continued progress on reducing the deficit is sound 
     economic policy, but a constitutional amendment requiring 
     annual balance of the federal budget is not. The fallacy in 
     the logic behind the balanced budget amendment begins with 
     the premise that the size of the federal deficit is the 
     result of conscious policy decisions. This is only partly the 
     case. The pace of economic activity also plays an important 
     role in determining the deficit. An economic slow-down 
     automatically depresses tax revenues and increases government 
     spending on such programs as unemployment compensation, food 
     stamps and welfare.
       Such temporary increases in the deficit act as ``automatic 
     stabilizers,'' offsetting some of the reduction in the 
     purchasing power of the private sector and cushioning the 
     economy's slide.
       Moreover they do so quickly and automatically, without the 
     need for lengthy debates about the state of the economy and 
     the appropriate policy response.
       By the same token, when the economy strengthens again, the 
     automatic stabilizers work in the other direction: tax 
     revenues rise, spending for unemployment benefits and other 
     social safety net programs fall, and the deficit narrows.
       A balanced budget amendment would throw the automatic 
     stabilizers into reverse. Congress would be required to raise 
     tax rates or cut spending programs in the face of a recession 
     to counteract temporary increases in the deficit. Rather than 
     moderating the normal ups and downs of the business cycle, 
     fiscal policy would be required to aggravate them.
       A simple example from recent economic history should serve 
     as a cautionary tale. In fiscal year 1991, the economy's 
     unanticipated slowdown caused actual government spending for 
     unemployment insurance and related items to exceed the 
     budgeted amount by $6 billion, and actual revenues to fall 
     short of the budgeted amount by some $67 billion. In a 
     balanced-budget world, Congress would have been required to 
     offset the resulting shift of more than $70 billion in the 
     deficit by a combination of tax hikes and spending cuts that 
     by themselves would have sharply worsened the economic down-
     turn--resulting in an additional loss of 1\1/4\ percent of 
     GDP and 750,000 jobs.
       The version of the amendment passed by the House has no 
     special ``escape clause'' for recessions--only the general 
     provision that the budget could be in deficit if three-fifths 
     of both the House and Senate agree. This is a far cry from an 
     automatic stabilizer. It is easy to imagine a well-organized 
     minority in either House of Congress holding this provision 
     hostage to its particular political agenda.
       In a balanced-budget world--with fiscal policy enjoined to 
     destabilize rather than stabilize the economy--all 
     responsibility for counteracting the economic effects of the 
     business cycle would be placed at the doorstep of the Federal 
     Reserve. The Fed could attempt to meet this increased 
     responsibility by pushing interest rates down more 
     aggressively when the economy softens and raising them more 
     vigorously when it strengthens. But there are several reasons 
     why the Fed would not be able to moderate the ups and downs 
     of the business cycle on its own as well as it can with the 
     help of the automatic fiscal stabilizers.
       First, monetary policy affects the economy indirectly and 
     with notoriously long lags, making it difficult to time the 
     desired effects with precision. By contrast, the automatic 
     stabilizers of fiscal policy swing into action as soon as the 
     economy begins to slow, often well before the Federal Reserve 
     even recognizes the need for compensating action.
       Second, the Fed could become handcuffed in the event of a 
     major recession--its scope for action limited by the fact 
     that it can push short-term interest rates no lower than 
     zero, and probably not even that low. By historical 
     standards, the spread between today's short rates of 6 
     percent and zero leaves uncomfortably little room for 
     maneuver. Between the middle of 1990 and the end of 1992, the 
     Fed reduced the short-term interest rate it controls by a 
     cumulative total of 5\1/4\ percentage points. Even so, the 
     economy sank into a recession from which it has only recently 
     fully recovered--a recession whose severity was moderated by 
     the very automatic stabilizers of fiscal policy the balanced 
     budget amendment would destroy.
       Third, the more aggressive actions required of the Fed to 
     limit the increase in the variability of output and 
     employment could actually increase the volatility of 
     financial markets--an ironic possibility, given that many of 
     the amendment's proponents may well believe they are 
     promoting financial stability.
       Finally, a balanced budget amendment would create an 
     automatic and undesirable link between interest rates and 
     fiscal policy. An unanticipated increase in interest rates 
     would boost federal interest expense and thus the deficit. 
     The balanced budget amendments under consideration would 
     require that such an unanticipated increase in the deficit be 
     offset within the fiscal year!
       In other words, independent monetary policy decisions by 
     the Federal Reserve would require immediate and painful 
     budgetary adjustments. Where would they come from? Not from 
     interest payments and not, with such short notice, from 
     entitlement programs. Rather they would have to come from 
     either a tax increase or from cuts or possible shutdowns in 
     discretionary programs whose 
     [[Page S3130]]  funds had not yet been obligated. This is not 
     a sensible way to establish budgetary priorities or maintain 
     the healthy interaction and independence of monetary and 
     fiscal policy.
       One of the great discoveries of modern economics is the 
     role that fiscal policy can play in moderating the business 
     cycle. Few if any members of the Senate about to vote on a 
     balanced budget amendment experienced the tragic human costs 
     of the Great Depression, costs made more severe by President 
     Herbert Hoover's well-intentioned but misguided efforts to 
     balance the budget. Unfortunately, the huge deficits 
     inherited from the last decade of fiscal profligacy have 
     rendered discretionary changes in fiscal policy in response 
     to the business cycle all but impossible. Now many of those 
     responsible for the massive run-up in debt during the 1980s 
     are leading the charge to eliminate the automatic stabilizer 
     as well by voting for a balanced budget amendment.
       Instead of undermining the government's ability to moderate 
     the economy's cyclical fluctuations by passing such an 
     amendment, why not simply make the hard choices and cast the 
     courageous votes required to reduce the deficit--the kind of 
     hard choices and courageous votes delivered by members of the 
     103d Congress when they passed the administration's $505 
     billion deficit reduction package?

  Mr. HATCH. Mr. President, the arguments of the Senator from Maryland 
are not arguments against balancing the budget, but to have a rainy day 
fund available built from surpluses made in the good years to soften 
the business cycle.
  The real economic harm to Americans are the stagnant wages, high 
interest rates, and high taxes all piled on the backs of working 
Americans as a consequence of yearly current consumption unrelated to 
the swings to the business cycle.
  There is some irony in the Senator's reference to an article by 
President Clinton's Economic Adviser Laura Tyson saying that tax 
increases and speeding cuts world deepen a recession when has boss, 
President Clinton, said tax increases and spending cuts would lead to a 
recovery when he fought for his tax bill in 1993.
  Mr. President, the Senator from Maryland has made again the objection 
to the balanced budget amendment that the business cycle and the 
automatic stabilizers suggest that we should run deficits in bad years 
to dampen the effect of recessions or depressions. His argument seems 
to suggest that cyclical deficits are normal and good. The problem is 
that our deficits have become large, structural, and permanent.
  Our deficits do not follow the business cycle in either size or 
frequency. They continue to go up, year after year. Surely we have had 
move than one business cycle since 1969, yet we have not balanced the 
budget in that time.
                           amendment no. 267

  Mr. FEINGOLD. Mr. President, I want to express my support of the 
amendment offered by the Senator from Massachusetts [Mr. Kennedy] last 
night which would specifically provide that the balanced budget 
amendment to the Constitution does not provide the President of the 
United States with unilateral power to impound funds or raise taxes. 
This amendment will be voted on next Tuesday and I hope it will be 
adopted.
  Mr. President, this amendment raises interesting questions because 
the opponents have repeatedly said that they do not believe that the 
balanced budget amendment, as drafted, should be interpreted to give 
the President the power to impound funds or raise taxes.
  Many have stated they would oppose giving that kind of power to the 
executive branch, even through the implementing legislation.
  The Judiciary Committee's majority report states, unequivocally, ``it 
is not the intent of the committee to grant the President any 
impoundment authority'' under the proposed balanced budget amendment.
  Yet, these same Members have strenuously opposed an amendment which 
would clarify this issue once and for all, by making it clear that 
neither the balanced budget amendment, nor any implementing legislation 
enacted pursuant to its authority can give the executive branch the 
unilateral authority to bring the budget into balance by raising taxes 
or impounding funds.
  It seems to me you can't have it both ways: you can not argue you 
don't support giving the President these sweeping powers and at the 
same time fight against an amendment which would make it clear that the 
balanced budget amendment does not provide such authority to the 
executive branch.
  Mr. President, it is particularly important that this issue be 
settled now, clearly and in a forthright manner, because it raises very 
serious and profound questions about how this country will be governed 
if this constitutional amendment is adopted.
  The question of Executive power under this amendment, like the 
question of the role of the courts, is one that ought to be answered 
now, before the amendment is added to our Constitution, not sometime 
later, in the distant future.
  The people of this country have the right to know in advance whether 
this amendment will allow a fundamental restructuring of the balance of 
power and responsibilities between the three branches of Government.
  The State legislators, who have an important responsibility when they 
vote whether or not to ratify this proposed amendment, ought to have 
this question resolved before they cast their votes.
  If this amendment can be construed to give the President the right 
to, for example, withhold Social Security checks, or salaries of 
military and civilian employees of the Federal Government, or grants to 
State and local governments in order to meet the constitutional mandate 
for a balanced budget, then we ought to know that in advance.
  Mr. President, the pending amendment to make it clear that the 
balanced budget amendment does not grant these sweeping powers to the 
executive branch is not about whether you are for or against the 
balanced budget amendment--it is about whether the proposed 
constitutional amendment is drafted in a way that can result in a 
fundamental change in the way this country is governed.
  The balance of powers between the three branches of Government--
legislative, executive, and judicial--is a concept which is fundamental 
to our system of Government. It has stood us well for more than 200 
years. Our democracy has survived and thrived because the checks and 
balances contained in our Constitution has prevented any one of these 
branches from becoming dominant.
  Without adoption of the pending amendment, that balance could be 
fundamentally altered.
  Mr. President, let me stress again the issue here is not about 
whether you support or oppose the balanced budget amendment. It is 
about whether you believe that the President should have the power to 
impound funds or raise taxes on the American people at his or her sole 
discretion.
  The concentration of this type of power in the hands of the executive 
is not something that I believe the people of this country want to see 
happen. They want to see their elected officials use some fiscal 
discipline and restraint to bring our Federal budget into balance. They 
want us to stop deficit spending and increasing the national debt--a 
debt that will be passed on to their children and grandchildren.
  I do not believe that these concerns about fiscal responsibility 
means that the American people want to see the emergence of an imperial 
Presidency.
  I do not believe that they want this President or the next to have 
the power to unilaterally impound funds or raise taxes.
  If the proponents of the amendment truly believe that the amendment 
does not bestow those powers on the President, then they ought to be 
willing to accept this amendment.
  Their resistance gives this Senator a great deal of concern, 
particularly in light of the strong legal arguments that have been 
presented indicating that the proposed balanced budget amendment could 
well be construed by the courts and the executive branch to bestow on 
the President extraordinary powers to impound funds or raise taxes in 
the event that the constitutionally mandated budget balanced has not 
been achieved.
  Mr. President, this is not a risk that we should expose ourselves to 
when a simple solution--adoption of the pending amendment--will resolve 
the question.
  A number of legal scholars have concluded that without such an 
amendment to the balanced budget amendment, the President would have 
such 
[[Page S3131]]  powers to enforce the constitutional mandate of a 
balanced budget. Their arguments, which I will summarize briefly, make 
a good deal of sense and we ought to heed their warnings.
  These scholars note that the balanced budget amendment which the 
Senate is now considering is silent on the issue of how it will be 
enforced.
  The amendment itself provides simply that total outlays cannot exceed 
total receipts in a fiscal year, unless each House of Congress approves 
a specific deficit by a three-fifths vote. The amendment, however, does 
not specify what action can be taken if an unconstitutional deficit 
arises, either because of the inaction of the legislative and executive 
branches, or because of unforeseen changes in economic factors.
  At the same time, proponents argue that the balanced budget amendment 
is self-enforcing. The Judiciary Committee report states, ``both the 
President and Members of Congress swear an oath to uphold the 
Constitution, including any amendments thereto.''
  As to how the President is expected to carry out that responsibility, 
particularly in the case of a recalcitrant Congress, the committee 
report simply states that it is not their intent to grant the President 
any impoundment authority, and that, in any event, Congress has the 
power under section 6 of the amendment to pass legislation that 
specifically denies impoundment powers to the President.
  The implication of these passages in the committee report is clearly 
that the proponents of the amendment recognize the very real risk that 
the proposed amendment opens the door to a President acting to impound 
funds or raise taxes to meet the constitutional mandate of a balanced 
budget and that they hope that Congress will proscribe that authority 
in implementing legislation.
  That is a thin argument upon which to rest such a profound issue as 
maintaining the constitutional balance of powers.
  If Congress failed to pass legislation to preclude a President from 
taking unilateral action to bring a budget into balance by either 
impounding funds or raising taxes or Congress passed such legislation, 
but a President vetoed it and his or her veto was not overridden, there 
is every reason to believe that such authority would be there for a 
strong executive to take under the guise of carrying out his or her 
constitutional obligations.
  Indeed, a President might well feel compelled to veto such 
legislation for the very reason that it would tie his or her hands in 
seeking to comply with the constitutional mandate to prevent outlays 
from exceeding revenues in any given fiscal year.
  The Constitution, article II, section 3, obligates the President of 
the United States to ``take care that the Laws be faithfully 
executed.'' A commonsense reading of the proposed balanced budget 
amendment and the obligation of the President to faithfully execute the 
law means that the President must act to either impounds funds or raise 
taxes if the total outlays of the Federal Government exceed the total 
revenues in any fiscal year.
  A broad range of respected legal scholars have reached that 
conclusion.
  Assistant Attorney General Walter Dellinger testified before the 
Judiciary Committee that the proposed constitutional amendment would 
authorize the President to impound funds to insure that the outlays did 
not exceed revenues.
  Harvard University law professor Charles Fried, who served as 
Solicitor General during the Reagan administration, testified that 
section 1 of the proposed amendment ``would offer a President ample 
warrant to impound appropriated funds'' in a year when actual revenues 
fell below projects and a bigger than authorized deficit occurred.
  Other legal scholars who have reached similar conclusions include 
former Attorney General Nicholas de B. Katzenbach, Stanford University 
Law School Professor Kathleen Sullivan, Yale University Law School 
Professor Burke Marshall, and Harvard University Law School Professor 
Laurence Tribe.
  Mr. President, I think it is important to stress that we are not 
talking here about the President exercising something along the lines 
of a line-item veto. Legislation which would give the President line-
item veto authority to remove spending items from appropriation bills 
and provide Congress the opportunity to override those vetoes has 
passed the other body and will soon be debated in the Senate. The 
Judiciary Committee has also already held hearings last month on 
proposed constitutional amendments to provide the President with line-
item veto authority.
  What we are talking about here, however, is not a line-item veto, but 
the power of the President to take whatever steps he or she deems 
necessary, including impounding funds and raising taxes without any 
review by Congress in order to meet the constitutional mandate of a 
balanced budget. That is a very different process from a line-item veto 
authority and one which would vest the executive branch with 
unprecedented fiscal powers.
  Mr. President, although much of the discussion regarding the 
Presidential powers to faithfully execute the requirements of a 
balanced budget amendment have focused upon the issue of impoundment 
authority, there is no reason to conclude that a President would not 
have equal powers to achieve a balanced budget by unilaterally raising 
taxes, duties or fees in order to generate the revenues needed to avoid 
an unconstitutional deficit. That is certainly not a result most 
proponents of the balanced budget amendment would like to see happen. 
The only sure way to prevent it is to adopt the pending amendment which 
would foreclose that option.
  Mr. President, the best way to ensure that the balanced budget 
amendment is not interpreted to give Presidents the power to 
unilaterally impound social security checks or raise taxes on middle 
class workers is simple--put it in writing.
  Adoption of this amendment will make it clear that the balanced 
budget amendment does not, in fact, authorize the President to exercise 
this kind of unprecedented power. Those who oppose this amendment have 
given no good reason why they are not willing to accept this amendment.
  They ask that the American people accept, on good faith, that they 
``do not intend'' to give the President these powers. The American 
people should not have to rely upon ``good intentions.'' Why take the 
risk? Let's write it into the amendment.

                          ____________________