[Congressional Record Volume 141, Number 37 (Tuesday, February 28, 1995)]
[House]
[Pages H2314-H2315]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                              {time}  1010
                         THE 2-PERCENT SOLUTION

  The SPEAKER pro tempore (Mr. Dickey). Under the Speaker's announced 
policy of January 4, 1995, the gentleman from Colorado [Mr. Allard] is 
recognized during morning business for 5 minutes.
  Mr. ALLARD. Mr. Speaker, the House of Representatives passed the 
balanced budget amendment last month. Today, the Senate will decide the 
fate of this critical reform. Whether the vote is yes or no, Congress 
will still need a statutory mechanism to ensure that spending is put on 
a glide-path to balance by the year 2002. I propose the 2-percent 
solution.
  Shortly, I will introduce legislation to establish caps that will 
limit overall spending growth to 2 percent a year. If this level is 
exceeded in any year, an across-the-board sequester will kick in and 
force the necessary cuts, excluding Social Security and certain other 
contractual obligations.
  With 2 percent growth the Federal Government can balance the budget 
of 2002 and still spend $1 trillion more over the next 7 years than it 
would under a 7 year freeze. Two percent growth will allow us to enact 
the tax cuts of the Contract With America and achieve the first 
balanced budget in 33 years.
  Two weeks ago, I attended a Budget Committee field hearing outside of 
the beltway to hear the views of our constituents. Over 1,000 people 
showed up and the message was clear--cut spending. Just do it, balance 
the budget. [[Page H2315]] That is what the Republican majority plans 
to do.
  During the debate on the balanced budget amendment, the rhetoric was 
thick with charges that the Congress does not need a constitutional 
amendment to balance the budget, all we need to do is offer a balanced 
budget. Well, the need for the balanced budget amendment is shown 
clearly by the President's just released budget.
  The President's budget is a lost opportunity to do what he called for 
in his State of the Union speech, a balanced budget without the need 
for a constitutional amendment. In the President's budget, there is no 
entitlement reform, no welfare reform, and spending in most major 
departments goes up. Department of the Interior spending is up; HUD and 
the Labor Department get an increase in spending; the EPA gets an 
increase in spending; the Energy Department gets a spending increase 
even through the administration once talked about abolishing the 
Department; and even the National Endowment for the Arts and the 
National Endowment for the Humanities get increases.
  The bottom line is not a balanced budget, it is $200 billion deficits 
as far as the eye can see.
  This is not what the average American is looking for. America wants a 
balanced budget. Unfortunately, the President has left the heavy 
lifting to the Republican Congress. Our goal is not $200 billion 
deficits, but a balanced budget with zero deficits. We must lead and 
meet the challenge and produce a budget that makes the tough cuts.
  During the balanced budget debate, some questioned whether we can 
ever balanced the budget. Opponents like to point to the fact that over 
$1.2 trillion in spending must be reduced. This huge number is used to 
show how painful it would be to actually enforce a balanced budget 
amendment by 2002.
  This argument could only occur inside the beltway. Though Republicans 
abolished baseline budgeting on opening day, much more must be done 
before the terms of the debate are changed.
  Baseline budgeting is the process of assuming automatic spending 
increases every year. If Congress appropriates anything less than the 
baseline spending growth, there has been a cut. I suspect most 
Americans believe a cut is when you spend less than you did the year 
before, not less than you thought you would spend.
  The current debate about a balanced budget amendment demonstrates why 
this issue of baseline budgeting is so important. Every nickel of the 
$1.2 trillion that must be cut is projected baseline growth.
  As the chart next to me shows, the CBO projects that spending growth 
will average 5.3 percent a year through 2002. Under this scenario 
Federal spending will grow from $1.5 trillion this year to $2.2 
trillion in 2002, and the deficit in 2002 will be well in excess of 
$300 billion.
  Of course, this assumes Congress does nothing to alter current 
spending patterns. If Congress instead manages to hold overall spending 
growth to 2 percent per year, the payoff for this discipline will be 
the first balanced budget in 33 years. And as I noted earlier, $1 
trillion more will still be spent over those 7 years than if spending 
had been frozen.
  So let me answer the doubters, there is no doubt about it, we can 
balance the budget by 2002. It can be done in a reasoned and 
responsible manner--by holding overall spending growth to 2 percent a 
year.
  It is not my intention to suggest that this will be easy. It will be 
difficult, particularly for those programs that are growing rapidly. 
But this is Congress' job, it is what the America people want.
  Over the last three decades Congress has dropped the ball on the 
budget. This is why we need the balanced budget amendment and the 2-
percent solution. With them we can build a secure future for our 
grandchildren.


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