[Congressional Record Volume 141, Number 75 (Monday, May 8, 1995)]
[Senate]
[Pages S6228-S6229]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
THE BUDGET
Mr. BYRD. Mr. President, section 301 of the Congressional Budget and
Impoundment Control Act of 1974 requires that on or before April 15 of
each year the Congress shall complete action on a concurrent resolution
on the budget for the fiscal year beginning on October 1 of such year.
The failure to meet this deadline, however, has no effect on points of
order under the Congressional Budget Act. In fact, Congress has met the
deadline only three times since enactment of the 1974 Budget Act;
namely, for fiscal years 1976, 1977, and 1994. So, it is not unusual
that Congress, at the April 15 deadline, has yet to complete action on
the 1996 budget resolution.
It does seem a little unusual that this year's budget resolution has
not been reported by the Budget Committee of either House. Perhaps our
friends on the Budget Committees are finding it somewhat more difficult
to come forward with a budget resolution which will force Congress to
make the difficult choices that will be necessary to achieve a balanced
budget, than it was to sign the mostly empty pledges that were
contained in the vacuous rhetoric of the so-called ``Contract With
America.''
For a while, everything seemed to be going along swimmingly for the
new Republican majority in Congress. We have been told over and over
again by the House Republican leadership that they would balance the
budget by the year 2002, while at the same time they would increase
military spending, cut taxes by some $630 billion over the next ten
years, and take Social Security off the budget-cutting table.
Thus ornament is but the guiled shore
To a most dangerous sea; the beauteous scarf
Veiling an Indian beauty; in a word,
The seeming truth which cunning times put on
To entrap the wisest.
It was obvious to all who examined this visionary proposal that it
amounts to a return to the failed policies of supply-side economics
undertaken during the Reagan-Bush years. The problem with the Reagan
plan was that we did the easy part--we massively increased military
spending and we drastically cut taxes. But when it came to the hard
part--cutting entitlement spending--everybody balked. We all know what
resulted from those actions--a string of unprecedented budget deficits
which were the largest the country has ever seen and which ceased to
grow only after the election of President Clinton.
In other words, we went on a national spending spree on credit--not
paying our bills, but charging them to future generations. As a result,
the national debt rose from $932 billion on January 20, 1981, when
President Reagan was sworn in, to $4.1 trillion on January 20, 1993,
the day that Bill Clinton was sworn in as President.
Immediately following his election, President Clinton submitted a
budget that cut the projected Bush deficits drastically and, in fact,
in 1993 Congress enacted a massive deficit reduction bill, which
President Clinton signed into law. That package of budget cuts reduced
the projected deficits over 5 years by roughly $500 billion, and it was
passed by both Houses of Congress without a single Republican vote.
The economy has responded well to the deficit reduction that has
taken place thus far under the leadership of President Clinton. I
believe that the economy will continue to perform well so long as we
continue our efforts to whittle away at the massive deficits built up
over the dozen Reagan-Bush years.
Tough decisions will be required to balance the Federal budget. I
know that it will require drastic action. I believe that the American
people, as a whole, are prepared to face the tough choices that will
have to be faced in order to balance the Federal budget, so long as
they are certain that their elected representatives are administering
the budget cuts fairly across every sector of the country. The budget
axe should not be wielded indiscriminately. This round of budget
cutting, to be effective, should involve priority setting; it should
involve separating out the truly effective and necessary Federal
Government programs from those that are merely nice to have but not
truly necessary for the Federal Government to be involved.
Furthermore, if we are to achieve fairness in our deficit-elimination
efforts, we cannot ignore the huge tax subsidies that are written into
the Tax Code from time to time and are never looked at again. These
kinds of tax expenditures, many of which may well serve a worthwhile
national purpose, should no longer be allowed to escape scrutiny along
with every other area of Federal activity.
We are told by the Congressional Research Service that there are over
120 separate tax expenditures in current law which will cost the U.S.
Treasury $453 billion this fiscal year. That figure will rise to $568.5
billion in fiscal year 1999--unless Congress and the President enact
changes to eliminate and otherwise cut back the growth in some of these
tax subsidies. If we fail to do so, then how can we possibly expect the
American people to believe that we have administered budget cuts
fairly?
Incredibly, Mr. President, we have not seen any indication by the
Republican leadership that they are prepared to even examine these 120
Federal tax subsidies to see if they are necessary or if they can be
afforded any longer.
Instead, we have seen the House pass a massive tax cut bill, which
will cost $630 billion over the next 10 years. And, who will get the
benefit of those tax cuts? According to the Treasury Department:
Nearly half the tax benefits--47 percent--would go to the wealthiest
10 percent of households. These households all have incomes at least
somewhat above $100,000, according to the Treasury measure.
The richest 1 percent of households--1.1 million households--would
receive 20 percent of the benefits from the tax package, while the
bottom three-fifths of households--65 million households--would receive
only 15.6 percent of the total tax benefits, according to the Treasury
data.
The average tax reduction for the wealthiest 10 percent of all
households would be nearly nine times greater than the average tax
reduction for the middle fifth of households--$4,821 and $555,
respectively.
Mr. President, I am totally opposed to tax cuts at this time. I will
not vote for President Clinton's tax cuts, I will not vote for the
House-passed tax cuts, or any other tax cuts that may be proposed at
this time. We need to keep an eye on the target of reducing the Federal
budget deficit until it is eliminated. From press accounts, I
understand that Senator Domenici, the very able and experienced
chairman of the Budget Committee, is planning to recommend to the
Budget Committee a budget resolution which, if carried out, would
result in a balanced budget for fiscal year 2002. It is my further
understanding that Senator Domenici's proposal will not include a tax
cut. Instead, a tax cut would have to wait until Congress has enacted
the necessary legislation to achieve budget balance, under CBO scoring,
by 2002.
If this is the position of the chairman of the Budget Committee, I
commend him for his courage and foresight, and for his integrity in
placing the emphasis in this year's budget resolution
[[Page S6229]] where it clearly should be--on eliminating the deficit
rather than on cutting taxes. I have long admired and respected the
intelligence and wisdom of Senator Domenici. He is a Senator who takes
his responsibilities very seriously and who works tirelessly to carry
out these responsibilities.
In addition to containing no tax cut, Mr. President, it is also
important that cuts in spending in this year's budget resolution be
administered fairly and equitably to both entitlement and discretionary
spending. As all Senators are aware, the discretionary portion of the
budget is under the control of the Appropriations Committees and
amounts to just over one-third, or $549 billion, of the President's
1996 budget. Of the remainder, net interest on the debt will be $257
billion, or 15.9 percent of the 1996 budget. The other one-half of the
budget consists of Social Security--which will equal $351.4 billion, or
21.8 percent of the 1996 budget--Medicare, Medicaid, and other
mandatory and entitlement programs.
If Social Security is taken off the table, and if we pay the interest
on the debt, which we must, then we have removed almost 38 percent of
the budget from budget cuts. We are told that the budget resolution
will also not cut military spending, and, in fact, will propose an
increase in military spending over the next 7 years. If this is done,
then we will have shielded 54 percent of the budget from cuts, leaving
only 46 percent, including other entitlements, to undergo budget-
cutting surgery over the next 7 years.
I ask the American people: Is that a fair way to proceed? Is it fair
to cut $500 billion over the next 7 years from domestic discretionary
programs, while increasing military spending?
The military consumes $262.2 billion in outlays in the President's
1996 budget. That amount is almost equal to the $265.8 billion that is
in the budget for all domestic discretionary programs. This includes
law enforcement, education, infrastructure spending on highways and
transit, environmental cleanup, clean air and water, research and
development, medical research, NASA, national parks, the Justice
Department, the judiciary, the FBI, and the operations of virtually all
agencies and departments in the Federal Government.
If we follow the Republican plan, we will cut all of these domestic
discretionary programs by approximately 35 percent by the year 2002, at
the same time we increase military spending. Is that fair? It is not
only unfair, it is pure folly.
Furthermore, under the Republican budget plan, the elderly will be
asked to pay dearly. Medicare will be cut anywhere from $259-$333
billion over the next 7 years. We hear that these cuts are not being
proposed for deficit reduction but only because Medicare will be broke
if we do not fix it soon.
Well, Mr. President, I see no proposal from the Republicans on how
they intend to fix the Medicare program. All I see is a cut in Medicare
spending totaling $259 to $333 billion over the next 7 years. Is it
fair to ask for this level of sacrifice from Medicare beneficiaries at
the same time military spending will be rising from a starting point of
$262.2 billion over the same 7-year period?
Or, is it fair to cut $500 billion from domestic spending on
education, law enforcement, highways, research, job training, and from
student loans, and veteran's medical care while, at the same time,
ignoring the subsidies in the Tax Code that total $453 billion in 1995
and which, as I say, will grow by a total of $283.9 billion over the
next 5 years, 1995 to 1999. In 1999 alone, these tax breaks will total
$568.5 billion, an increase of $115.5 billion over their 1995 cost.
It is incredible--even beyond belief--that Congress would enact a 7-
year, deficit-elimination package that cuts $500 billion from domestic
investments and cuts between $259 and $333 billion from Medicare, while
it cuts nothing from military spending and while we allow permanent tax
breaks to grow by $283.9 billion! How can we expect the American people
to accept this approach to budget balancing? It is not only unfair, it
is irrational.
What this amounts to is protecting the special interest groups and
the wealthy. They will get to keep their existing tax breaks, and, to
make matters worse, they will also get the overwhelming share of the
tax cuts already passed by the House, which amount to a $630 billion
drain from the Treasury over the next 10 years.
On a related matter, there has been speculation that the Republican
welfare reform package will be included as part of this year's
reconciliation measure. If these reports are accurate, this should be a
cause of great concern to all Senators and to the American people. I
say this not from any partisan perspective. As I stated to the
distinguished majority leader in a letter dated March 31, 1995, I agree
that welfare reform is certainly necessary. But I have strong
reservations about taking up such far-reaching and important
legislation as part of a reconciliation measure, upon which very
limited debate is allowed.
In my view, the reconciliation process was not intended to allow the
adoption of major legislative proposals, such as welfare reform, under
conditions where debate is limited. This is not a new position for me.
I opposed such a tactic on health care reform last year, when both the
then-majority leader and President Clinton urged my support for
including health care in last year's reconciliation measure. Major
proposals of this kind should be thoroughly and thoughtfully examined
by the Members of both parties on this Senate floor in a free and full
debate, not under the extremely limited debate that is allowed for
reconciliation measures.
I implore the Senate Budget Committee, under the able leadership of
its chairman, Senator Domenici, and its equally able ranking member,
Senator Exon, to carefully consider these very important matters as the
committee marks up the 1996 budget resolution.
As I have already stated, I do not believe that the American people
deserve, nor will they support, a deficit-elimination package unless
its effects are distributed fairly across all segments of the
population. I do not believe they will support a continuation of
existing tax breaks along with new massive tax cuts for the wealthy,
while Medicare beneficiaries are being asked to pony up hundreds of
billions of dollars over the next 7 years.
I urge Senators not to attempt to balance the budget on the backs of
millions of Americans by savaging their health care benefits, while at
the same time enacting hundreds of billions of dollars in new tax
breaks which primarily benefit the wealthiest in our society. No amount
of hollow rhetoric in a so-called Contract With America can hide the
perverted policies being proposed by those who signed this so-called
contract which was, after all, fashioned by pollsters for the purpose
of gaining political advantage.
Mr. President, I yield the floor, and I suggest the absence of a
quorum.
The ACTING PRESIDENT pro tempore. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. SPECTER. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The ACTING PRESIDENT pro tempore. Without objection, it is so
ordered.
The Senator from Pennsylvania.
Mr. SPECTER. I thank the Chair.
____________________