[Congressional Record Volume 141, Number 81 (Tuesday, May 16, 1995)]
[House]
[Pages H4960-H4961]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                   FISCAL YEAR 1996 BUDGET RESOLUTION

  The SPEAKER pro tempore. Under the Speaker's announced policy of May 
12, 1995, the gentleman from Colorado [Mr. Allard] is recognized during 
morning business for 5 minutes.
  Mr. ALLARD. Mr. Speaker, I am very proud of the budget that the 
Republicans on the House Budget Committee have produced.
  It produces a balanced budget in 2002--just as we promised.
  This will be the first balanced budget in 33 years. That is right, 
1969 was the last year the Federal Government balanced its books.
  As a member of the Budget Committee, I can say we have worked 
tirelessly since January to produce a plan that is fair and honest.
  The plan has the unanimous support of the committee Republicans, as 
well as Democrat Mike Parker of Mississippi. Opponents are already 
attacking this plan, and distorting what it 
[[Page H4961]] really does. That is why I want to get out the facts.
  To those who oppose this plan I say, what is your alternative? 
Where's the Beef? How would you balance the budget?
  The President's plan produces $200 billion deficits as far as the eye 
can see. He never balances the budget.
  Now, let us talk about this budget. First, as we promised, Social 
Security is off the table.
  Second, we freeze defense, and make clear that defense spending will 
continue to undergo the kind of scrutiny of other aspects of the 
budget.
  Third, we reduce all discretionary spending, including foreign aid.
  We abolish three Cabinet agencies: Commerce, Energy, and Education.
  This plan also eliminates 283 programs, 14 agencies, and 68 
commissions.
  Overall this budget simply slows the growth in spending to just over 
2 percent a year. The difference is that under current forecasts we 
grow over 5 percent a year.
  This plan is not perfect. But it is far superior to other options, 
and far superior to doing nothing. This is the best plan that has been 
put on the table in years. It produces a balanced budget. It is a 
budget for our children.
  Now let me talk about health care. This is important because it will 
be the source of much distortion in the coming days.
  First, we do not cut Medicare or Medicaid, both grow under our plan. 
Let us look at this chart. It shows why we have to slow the rate of 
growth in Medicare and Medicaid. Both programs are growing at over 10 
percent a year.
  The rest of the Government is growing at much slower rates. This is 
not sustainable.
  In fact, the Medicare Trustees Report, released in April, and signed 
by three members of the President's Cabinet, says that Medicare will go 
broke in 7 years if we do nothing. That is why we slow the growth in 
both programs.
  Let me focus on Medicare. We slow the growth to 5 percent a year. 
This means we will increase Medicare spending over 7 years, from $4,700 
per beneficiary today to $6,300 per beneficiary in 2002. This preserves 
the solvency of Medicare.
  Now, enough statistics. Why are we doing this? Why is a balanced 
budget so important for our children and grandchildren?
  Alan Greenspan, Chairman of the Federal Reserve, summed it up very 
well when he testified before the Budget Committee earlier this year.
  Let us go down the list on the chart.
  If we balance the Budget:
  One, our children will have a higher standard of living than their 
parents.
  Two, there will be improvement in the purchasing power of incomes.
  Three, a rise in productivity.
  Four, reduction in inflation.
  Five, strengthening of financial markets.
  Six, acceleration of long-term economic growth.
  And most important, seven, a significant drop in long term interest 
rates.
  Now, what does all this mean to American families. It means a higher 
standard of living.
  It means families will pay less for their home mortgage because of 
lower interest rates.
  It means more families will be able to afford college for their 
children.
  It means lower car payments.
  This week's Time magazine has an excellent article on this topic.
  It explains how balancing the budget can help revive the American 
dream.
  The article talks about how lower deficits mean lower interest rates, 
and therefore more job creation by U.S. business. The article provides 
one very specific example of a young couple who are considering a new 
home.
  Under a mortgage rate of 8 percent, they would pay $734 a month on a 
$100,000 mortgage. If interest rates are 1 percent lower, this payment 
if cut to $665.
  This would save $28,000 over the life of the mortgage. This would be 
enough to put one of their future children through a year of college.
  Similarly, I have been using the example of farmers, because there 
are reductions in agriculture subsidies in this budget.
  However, it is estimated that a 1.5-percent reduction in interest 
rates would save the farm sector over $10 billion in interest payments 
on their debt over 5 years. This more than offsets the reduction.
  These are examples of what it means to balance the budget. This is 
not just an exercise in accounting. It really matters. It will make a 
difference in the lives of every American. It will particularly, make a 
difference in the livers of our children and grandchildren.
  I urge my colleagues to join me in supporting the first balanced 
budget in 33 years.


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