[Congressional Record Volume 141, Number 168 (Friday, October 27, 1995)]
[Senate]
[Pages S16084-S16099]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   BALANCED BUDGET RECONCILIATION ACT

  Mr. PRESSLER. Mr. President, I am pleased to be voting today for the 
Balanced Budget Reconciliation Act. For the first time in a generation, 
the United States Senate will be voting to end fiscal irresponsibility. 
Today, we have the opportunity to leave the next generation not 
mountains of debt, but the prospect of a stronger economy and a better 
standard of living.
  Many of us have fought this battle to end runaway deficit spending 
for decades. I have done what I can. I have kept my votes within a 
balanced budget. I have cosponsored constitutional amendments to 
balance the budget, and measures to grant the President line item veto 
authority. When I assumed the chairmanship of the Committee on 
Commerce, Science and Transportation, I voluntarily reduced my staff 
budget by 15 percent. Those of us who believe in common sense budgeting 
fought tenaciously to reverse years of liberal excess and largess that 
has left the United States a debtor nation. For years, the only things 
I have had to show for my efforts to balance the budget are awards from 
grassroots, fiscal watchdog organizations. Today, with passage of this 
legislation, I have my eyes on the ultimate prize: a balanced federal 
budget. It is about time.
  Of course, the people who deserve most of the credit are the American 
people. As they have done in so many instances throughout our nation's 
history, the American people made the difference. Last November they 
said enough is enough. They sent home many liberal caretakers of a run-
down, bloated federal government, and sent to Washington a new corps of 
members that share my common sense approach to government. American 
families, working hard to provide for their children's future, knew 
that the federal debt stood as an ominous threat to their efforts and 
their way of life.
  The people of South Dakota long ago made clear they do not tolerate 
wasteful deficit spending. South Dakotans believe that the federal 
government should live within its means--just like every family, every 
farm, and every business large and small. They are absolutely right.
  No single act this Congress can take could have a more positive 
impact on more Americans than a vote to balance the federal budget. The 
facts are clear. A balanced federal budget and a lower debt free up 
investment dollars that have gone toward financing the debt or making 
interest payments on the debt. In practical terms, a balanced budget 
would mean three key things: First, it would mean lower interest rates 
by up to two percent, making loans for new businesses, a new home or 
car, or a college education more affordable; second, it would mean at 
least 6.1 million new jobs; and third, it would mean a higher standard 
of living. In fact, a balanced budget would result in per-family 
incomes rising on average by $1,000 a year.
  With all the clear benefits, it is no wonder that the American people 
strongly favor a balanced budget. Americans recognize that fiscal 
irresponsibility has been a stifling barrier to progress--a barrier 
that gets larger, more onerous and more oppressive unless we act. 
Today, we are acting. A balanced budget is not just a restoration of 
common sense government. It is nothing less than economic liberation 
for every American family and business.
  The balanced budget bill we pass today maintains our commitment to 
vital programs, such as student loans and national security. It also 
preserves and improves outdated, costly social programs that threaten 
to spiral our country into bankruptcy. Chief among them is Medicare.
  Medicare reform is critical. I support Medicare. It provides 
essential hospital and health care services to 37 million Americans, 
including 113,000 South Dakotans. My mother depends on Medicare for 
basic health care.
  As all of us know, earlier this year, we received troubling news from 
the trustees in charge of Medicare. They said that Medicare would be 
bankrupt in seven years. Without action by the year 2002, there would 
be no money to pay senior citizens' hospital bills. Seniors would be 
stuck for the entire bill because Medicare would not be around to help. 
That must not happen. If we enact the Medicare reforms contained in S. 
1357, that will not happen.
  This bill would save Medicare by making a number of key reforms. 
First, the bill would slow the rate at which Medicare is spending our 
tax dollars. At present, Medicare is growing at an annual rate of 10.4 
percent. That is too fast. It is like forcing a person to run a 
marathon at a sprinter's pace. If allowed to grow at this pace, 
Medicare will burn out and run out of money in seven years. Like the 
marathon runner, we need to slow the pace of Medicare growth so it can 
run longer. That is just what this bill would do. It would slow 
Medicare growth to a more manageable 6.4 percent--still twice the rate 
of inflation, but at a pace that would enable Medicare to stay solvent 
for years to come.
  In terms of dollars and cents, total Medicare spending would increase 
from $178 billion this year to $274 billion by the year 2002--that is a 
total of $1.6 trillion invested in Medicare and an increase of 54 
percent over seven years. This growth rate is faster than any other 
major government program. Spending per South Dakota Medicare 
beneficiary would increase as well, from $4,816 this year to $6,734 in 
the year 2002--an increase of $1,918.
  This bill would improve Medicare as well. The Republican Medicare 
reform plan rests on three basic principles: First, every senior would 
be able to choose the same fee-for-service Medicare plan they have now, 
with all of Medicare's benefits. Second, senior citizens would continue 
to be able to choose their own doctor. Third, seniors would have a new 
option--the option to choose from a variety of health plans, as do 
younger Americans and Members of Congress. Seniors could stay on 
Medicare, or opt for a health plan offered by a Health Maintenance 
Organization (HMO), a Provider Sponsored Network (PSN), or even a 
health plan sponsored by a pool of physicians.
  For the first time, seniors would be given a greater choice over 
health care options. They would have leverage as health care consumers 
in a newly competitive health care market. This option of choice would 
offer senior citizens more benefits, such as eyeglasses, prescription 
drugs and hearing aids, at a lower cost.
  In short, Republicans intend to improve Medicare by preserving its 
best elements, and empowering senior citizens, not the government, to 
choose the health plan that suits them best.
  This legislation also contains much-needed reforms in the Medicaid 
program. Like Medicare, the Medicaid program is growing at an excessive 
rate that threatens funding levels for other vital social programs. The 
core element of Medicaid reform is to slow the rate of growth in the 
program, from 10.5 percent to just under 5 percent We further reform 
Medicaid by giving the States greater authority to administer the 
program, while maintaining our traditional commitments to cover 
pregnant women and children, as well as the disabled.
  The balanced budget legislation also maintains our commitment to 
young Americans who need financial assistance for college. Much 
misinformation has been circulated by the liberals, but the reality is 
student financial aid enjoys wide bipartisan support. This was made 
evident just yesterday, when the Senate overwhelming approved an 
amendment I cosponsored to provide an additional $5 billion for student 
financial aid. This amendment would preserve the in-school interest 
subsidy for both undergraduate and graduate students. It also would 
prevent any increases in the interest rate on PLUS loans for parents 
and it eliminated a misguided .85 percent fee on student loan volume on 
colleges and universities.
  I am very pleased the Senate adopted this amendment. During the 
Senate Labor Committee's consideration of its provisions in the 
balanced budget legislation, I contacted Chairman Kassebaum to express 
my opposition to any 

[[Page S 16085]]
new fees on higher education institutions as a way to preserve our 
commitment to Federal student loan programs.
  Frankly, we could do even more for our financial aid programs by 
repealing the wasteful direct lending program. This bill takes a step 
in that direction by capping the direct lending program at 20 percent. 
This program is a very inefficient and costly attempt to remove the 
private sector from the student loan process. The Congressional Budget 
Office [CBO] estimated that the elimination of direct lending would 
save taxpayers $1.5 billion over 7 years. In addition, students and 
families are better served by their local banks than faceless 
bureaucrats in Washington.
  I have heard from many young South Dakotans on the importance of 
financial aid for higher education. I personally identify with their 
concerns. I relied on student loans to get through college. Let me 
assure them and their parents that the balanced budget bill before us 
today is a winner in two respects --first, it maintains the Federal 
commitment to federal student loan programs; second, by balancing the 
budget, young South Dakotans will inherit an American economy and a 
standard of living second to none.
  Finally, Mr. President, the balanced budget bill brings much-needed 
tax relief to the American people--tax relief that is balanced, 
reasonable and fair. We need tax relief for a number of reasons. First, 
the current tax code is unfair to working Americans. Since 1950, the 
tax burden has risen dramatically. Today, average Americans see up to 
40 percent of their hard-earned income go toward taxes. In a nation 
where the average family has both parents on the job, Americans are 
working harder than ever before. Yet, they have less and less to show 
for it. That is not right. A heavy tax burden stalls economic growth, 
prevents savings and investment, and hinders a family's ability to 
provide for the well-being of their children.
  Second, we need tax relief to reverse the adverse affects of the 1993 
tax increase--the largest in American history. This tax increase is the 
main reason why the current economic recovery has been much slower than 
previous recoveries. As I stated, a balanced budget provides our 
economy a much-needed boost. Tax relief would empower working Americans 
with the means to further boost our economy. Indeed, this tax relief 
bill is good for all Americans--families, small businesses, farmers and 
seniors.
  We have carefully crafted a bill that takes a big step toward 
fairness and empowers Americans to contribute to the health of our 
country, our communities and our families. And we do so without leaving 
a Federal deficit.
  The largest component of this tax package would provide a $500 per 
child tax credit for low- and middle-income families. This is money 
that can go where it can do the most good--in family budgets to serve a 
number of purposes, ranging from child care to saving for a college 
education.
  This tax credit is great news for tens of thousands of South Dakota 
families. Specifically, more than 84,000 South Dakota families would 
benefit from the tax credit. Of that number, more than 31,000 South 
Dakota taxpayers would have their tax liability eliminated completely. 
This is a true middle class tax cut. In fact 84 percent of the tax 
relief in this bill would go to Americans making less than $100,000 a 
year.
  The bill would provide even more tax relief for the middle-class by 
creating a student loan deduction for up to 20 percent of interest--up 
to $500--paid on a student loan.
  The bill would create an adoption credit to encourage and reward 
those who reach out to open their hearts and homes to a child in need 
of a home. And we have strengthened our commitment to families by 
relieving the unfair burden of the marriage tax penalty.
  The bill would encourage middle class families to save and invest by 
creating a new Individual Retirement Account. Current use of tax-
deductible IRAs would be expanded through an increase in the income 
limits, which would encourage Americans to save more and secure their 
futures. Homemakers would be allowed participation in IRAs. Finally, 
penalty-free withdrawals would be allowed for first time home 
purchases, medical expenses, periods of unemployment and higher 
education expenses. I have long been a strong advocate for making IRAs 
more flexible for families. I am proud to be a co-sponsor of the 
original legislation, which was incorporated in S. 1357.
  Our economy would be further stimulated by the capital gains tax cut 
contained in this bill. More often than not, capital gains taxes hurt 
middle income families. The vast majority of capital gains is realized 
from those individuals who have held a family home or farm for decades 
or even generations, and are severely punished by the tax code when 
they finally sell their primary assets to pay for retirement. This bill 
would cut the capital gains tax rate by 50 percent for individuals. 
This would allow individuals who now are holding assets for fear of the 
capital gains tax to put those assets to a more productive use.
  Our small businesses--the true engines of our economy--would benefit 
from the capital gains reforms, but also from other specific items in 
our bill that were created for their benefit. Many small businesses do 
not offer pension plans to their employees due to the administrative 
costs and unnecessary paperwork that is required. For those businesses 
with less than 100 employees and limited resources, the bill would 
create a simple 401(k) plan where employees can contribute up to $6000 
of wages, and employers must match up to 3 percent of the employee's 
pay.
  One portion of this bill that I am particularly proud of is estate 
tax relief for family farms and businesses. Too often, people work 
their entire lives to build a successful farm, ranch or other small 
business, with the hopes of passing it along to their children. 
Unfortunately, the estate tax laws take away the fruits of their labor 
by imposing a tax of up to 55 percent upon the family estates. This 
frequently forces the family to sell all or part of the business simply 
to pay estate taxes. Earlier this year, after months of preparation, 
Chairman Roth, Senator Dole, Senator Pryor and I introduced legislation 
that would exempt the first $1.5 million of qualified family-owned 
business assets from estate taxes, and then to provide a 50 percent 
rate cut beyond that.
  The continuation of family-owned businesses is critical to the 
strength of our communities. This is true in South Dakota, where family 
farms and businesses have been the heart and soul of our economic 
development since statehood. Family-owned businesses give our kids 
something to work toward--and it helps our towns and neighborhoods by 
providing an active business commitment to their stability. The estate 
tax reforms in this legislation would end the imposition of estate 
taxes for virtually every family-owned family farm and small business 
in South Dakota.
  I also worked to include in the bill a modest, but much-needed change 
to the Generation-Skipping Transfer Tax laws that would free up more 
options for contributing estate assets to charity.
  I am pleased that this bill would retain the ethanol tax credit and 
extend the recently expired ethanol blenders tax credit, which is very 
important to South Dakota corn farmers and ethanol blenders. Both 
provisions are important for rural America and farm income. These kinds 
of credits are essential in order to provide new market opportunities 
for farmers. Ethanol is a fuel source that is cleaner for the 
environment, reduces dependency on foreign oil and strengthens our 
agricultural sector.
  This tax package is a solid, reasonable approach to tax relief. It 
stimulates the economy and helps those who are trying to make a better 
life for themselves. Having the ability to plan ahead for retirement 
and other, unexpected, life changes benefits the society as a whole.
  In order to assist those who seek to provide for their long-term 
health needs, the bill would clarify the treatment of long-term care 
insurance so that it would be treated like medical insurance and 
receive favorable tax treatment. The more we can encourage people to 
plan ahead for themselves, the stronger all of our futures will be. We 
have created Medical Savings Accounts [MSAs] so that everyone can plan 
for medical crises. The earnings on these accounts would be tax-free as 
are the withdrawals for certain purposes. 

[[Page S 16086]]

  Mr. President, the driving principle behind this entire legislation 
is fairness--fairness to hard-working Americans and particularly to our 
children, who stand to inherit this country. Without this legislation, 
Americans would be subjected to egregious forms of unfairness on many 
fronts. Unless we balance the budget, young Americans will inherit a 
nation submerged in debt. A child born today already owes $187,000 just 
on interest on the Federal debt. That is more than $3,500 in taxes 
every year of her working life--a lifetime tax rate of 84 percent. This 
debt stands to threaten the very foundations of our economy and our 
country.
  Without this legislation, Medicare will go bankrupt in the year 2002. 
Americans not yet of retirement age, who are contributing a significant 
portion of their pay to Medicare, deserve to know that Medicare will be 
there for them when they retire.
  Without this legislation, hard-working Americans would be saddled 
with a tax system that punishes their ability to save, invest and 
provide for their families.
  This legislation restores fairness to fiscal policy, seniors' health 
care and tax policy. Most Americans play by a common sense set of 
values. Americans work hard. They obey the law. They look out for their 
family and community. They try to provide for their future and their 
children's future.
  For more than a generation, the Federal Government has stood in stark 
contrast to these values. The Federal Government taxes far too much and 
spends even more. It does not live within its means. It stifles 
individual initiative and ingenuity. This liberal tax and spend 
philosophy stands to threaten the livelihoods and the values that 
embody them of future generations.
  Today, we take a significant step to right the wrongs of an 
irresponsible legacy of tax and spend. It is a historic occasion. 
Today, we set the stage for a new legacy of fiscal responsibility and 
fairness to American families. The American people made history last 
November by giving the Republicans control of Congress for the first 
time in more than a generation. They called for fair, common sense 
government. Tonight, for the first time in more than a generation, we 
in the Republican party will give the American people what they asked 
for: A fair, common sense government that lives within its means.


                        naval petroleum reserves

  Mr. DOMENICI. Mr. President, there was a point of order sustained 
against the provision in the bill providing for the sale of the naval 
petroleum reserves [NPR], it is a technical violation of the Byrd rule.
  The budget resolution included a reconciliation instruction based on 
the gross proceeds from the sale of the naval petroleum reserves. For 
reconciliation purposes, the Senate Budget Committee has scored the 
gross proceeds to the Armed Services Committee consistent with the 
budget resolution.
  Under reconciliation scoring, there is no violation under the Byrd 
rule.
  For the purposes of scoring under sections 302 and 311 of the Budget 
Act and determining whether the budget is balanced we do take into 
account the forgone receipts from the sale of the naval petroleum 
reserve. So, under that scoring there would be a net outlay increase in 
the out-years.
  Even so, no one should be under the impression that the sale of the 
NPR will lose the Government money.
  Under CBO's scoring, the sale of the naval petroleum reserves [NPR] 
leads to three budgetary impacts: $1.6 billion increase in gross 
proceeds to the Government from the sale of the NPR; $2.5 billion in 
forgone receipts over the next 7 years from the sale of the reserves; 
and at least $1.0 billion in discretionary spending savings associated 
with the fact that the Government no longer will need to spend money to 
operate and maintain the reserves.
  None of these figures take into account the interest savings the 
Government will earn or the tax revenues that will be generated by the 
private operation of this oil venture. Even without these additional 
savings, the sale still generates savings to the Federal Government 
over a 7-year time period.
  The point of order against this provision is clearly a technical 
violation. I will work to ensure the sale of the NPR's is incorporated 
into the conference report and there is no Byrd rule violation.
  The irony here is that a Democratic point of order will defeat the 
President's proposal to sell the naval petroleum reserves. If we don't 
sell it, the President's plan is even more out of balance.
  Mr. President, the NPR has outlived the original purpose for which it 
was established around the turn of the century--a fuel reserve for the 
Navy.
  Since 1976, the Department of Energy has been operating NPR as a 
commercial oil venture. The quality of oil produced from the NPR is not 
suitable for use by the modern Navy and instead is sold to the private 
market.
  There is no national security rationale for the Federal Government to 
continue managing NPR oil production, either in terms of military or 
domestic energy requirements. The private sector can run NPR more 
efficiently than the Federal Government.


                      International Simplification

  Mr. DOLE. Mr. President, I would like to state my support for 
including several international tax simplification measures in the 
conference report. There is an urgent need to address certain issues 
now before businesses make operational decisions that may negatively 
impact the growth of those industries for years to come, and, as a 
result, harm the U.S. economy. I know that Senators Hatch, D'Amato, 
Chafee, Grassley, and Mack also have strong concerns in this area, and 
I hope we can all work together to see that these issues are addressed 
in the conference report on this bill.
  The provisions to which I refer include various international 
simplification measures, some of which are in the House bill, including 
a measure that would permit foreign tax credits to be applied to taxes 
paid by fourth-, fifth and sixth-tier controlled foreign corporations 
(CFCs), as well as the repeal of Section 956A of the Internal Revenue 
Code, the clarification of the application of the foreign sales 
corporation (FSC) rules with respect to software exports, and a 
reevaluation of the deferral rules for foreign shipping income of 
CFC's.
  One of the provisions on which I believe we should act is section 
956A, which was one of the tax increases included in President 
Clinton's 1993 tax bill. Contrary to the stated reason for enacting 
this provision, in many cases it has created an incentive for U.S. 
multinationals to invest overseas rather than in the United States. 
This is because by having its foreign subsidiary invest in active 
foreign assets, a U.S. multinational reduces its tax liability. Thus, 
section 956A essentially provides a 35 percent investment tax credit 
for foreign investment by U.S. companies. Similar problems arise from a 
provision that today could cause a CFC to be treated as a PFIC because 
current law generally does not recognize the value of a company's 
intangible assets. These and other international tax simplification 
issues should be addressed in the conference agreement to this bill.
  Mr. HATCH. Mr. President, I share the concerns expressed by the 
majority leader regarding the need to repeal Section 956A and the 
application of the PFIC rules to CFC's in connection with intangible 
assets. I would also like to express my concern about the problem of 
the overlap between subpart F and the PFIC provisions in general. I 
look forward to working together with the leader to correct all of 
these problems in the conference report on this bill. These provisions 
have the effect of hindering competitiveness of U.S. multinationals and 
distorting investment decisions that properly should be governed by 
economic considerations alone. Thus, they put at risk U.S.-based jobs. 
The 956A and PFIC rules have an especially harsh effect on research-
intensive companies, which tend to accumulate capital before making 
major investments. As a result, I am particularly concerned that 
research activities may be moved overseas in order to avoid the impact 
of these rules. I believe this Nation may gradually lose its 
competitive edge in the technology field if through ill-conceived tax 
rules we provide incentives for this technology to be developed and 
owned outside the United States. As you know, technology industries are 
very important to my State of Utah, and I am concerned about Tax Code 

[[Page S 16087]]
provisions that have the effect of causing those industries to move 
their high-paying jobs out of the United States. For that reason, I 
would like to ask the leader's support for addressing in conference a 
problem that has arisen because of a narrow and ill-conceived IRS 
interpretation of the foreign sales corporation (FSC) provisions as 
they apply to exports of software, which I fear could also result in 
the movement of software development jobs overseas.
  The FSC rules were enacted to address competitive disadvantages faced 
by U.S. exporters vis-a-vis exports from other countries that have more 
favorable tax systems, particularly those that effectively exempt 
export sales from home country tax. The goal of the FSC provisions was 
to remove an incentive to move manufacturing and production jobs out of 
the United States. Unfortunately, a narrow IRS interpretation of these 
rules could preclude exports of software copyrights from qualifying for 
export treatment under the FSC rules when those exports are accompanied 
by a right to reproduce the software overseas. I am very concerned 
because software companies are already examining opportunities to move 
high-paying software development jobs overseas where highly skilled 
labor is available at much lower wages. FSC benefits help offset higher 
U.S. labor costs by providing benefits on the export of products 
developed in the United States. I believe it is very important to 
clarify these rules to reflect the Congress' intent with respect to 
software, not only to protect U.S. software development jobs, but also 
to preserve ownership of this technology in the United States.
  The narrow IRS interpretation of the application of the FSC rules to 
software was included in 1987 temporary and proposed regulations, which 
were never finalized. The Treasury Department has broad authority under 
current law to implement congressional intent by providing that a 
copyright on software qualifies as export property even if the software 
is accompanied by a right to reproduce. I believe that the Treasury 
Department should take action on its regulations to so provide this 
result. However, Treasury has indicated that it prefers congressional 
action to resolve this issue. In any event, 8 years is too long to wait 
for Treasury to take action on its temporary regulations, especially 
given the fact that the software industry regularly receives 
solicitations to move their software development to other countries, 
such as Ireland and India. Therefore, I hope that the majority leader 
will support legislative clarification of this issue in the context of 
international tax simplification measures that will be considered by 
the conference committee. This clarification of the FSC rules is an 
important simplification measure because it will implement the intent 
of Congress and help taxpayers and the IRS avoid years of litigation 
over the current regulations and help to avert complicated 
restructuring activities.
  Mr. DOLE. Mr. President, I, too, am concerned about the Treasury 
Department's interpretation of the FSC rules with respect to computer 
software and do not believe that the FSC statute precludes the 
application of the FSC provisions to computer software in the case 
described by the Senator from Utah. Given the Treasury's unwillingness 
to resolve this issue, I agree that we should address this issue in 
conference.
  Mr. D'AMATO. Mr. President, I share the views of the majority leader 
and the Senator from Utah with respect to the urgent need to provide 
long-overdue improvements to our international tax system, especially 
when existing law hampers our industries as they expand their 
operations in the global marketplace.
  The need for simplification and reform is illustrated by section 956 
of the Internal Revenue Code--a section introduced in the 1960's and 
designed to prevent taxpayers from avoiding taxation on the 
repatriation of foreign earnings through disguised dividends in the 
form, for example, of loans to affiliates. In general, ordinary course 
of business financing transactions appropriately were exempted from 
this provision. Since section 956 first was introduced, however, the 
scope and complexity of international business have expanded rapidly, 
but the ordinary course of business exceptions to section 956 have not 
been updated.
  For example, U.S.-based securities firms typically had negligible 
foreign earnings at the time section 956 was introduced, and therefore 
the ordinary course of business exceptions to that provision did not 
reflect standard commercial practices in that industry. In recent 
years, however, many U.S.-based securities firms have transformed 
themselves into global institutions by developing substantial 
international operations (just as many foreign-based institutions now 
compete in the United States). Section 956 has never been updated to 
reflect this surge in the international activities of the U.S. 
securities industry, thus forcing the industry into complex uneconomic 
transactions.
  This is just one example of how U.S. taxation has not kept up with 
the political, economic and technical changes that have created new 
opportunities and broken down old barriers as national markets are 
replaced with global markets. Our tax laws should reflect and support 
these changes in a similar fashion, or they will force undue complexity 
on U.S.-based companies.
  I join with the Senators from Kansas and Utah in supporting the 
principal of tax reform in the international area and the inclusion of 
international simplification and reform in the conference report.
  Mr. DOLE. Mr. President, I agree that we should try to address these 
measures in conference.


                        baucus motion to strike

  Mr. BIDEN. Mr. President, there is a stretch of coastal plain in 
northeastern Alaska which has been called North America's Serengeti. 
Nestled between the towering 10-thousand foot peaks of the Brooks Range 
and the frigid Arctic Ocean on the North Slope of Alaska, lies the 
Arctic Coastal Plain, the 1\1/2\-million-acre crown jewel of the 19-
million-acre Arctic National Wildlife Refuge. According to the Fish and 
Wildlife Service, the coastal plain area is the biological heart and 
the center of wildlife activity in the refuge. This pristine and 
complex Arctic ecosystem is habitat for a complete spectrum of 
wildlife, including polar and grizzly bears, wolves and snow geese. A 
160,000-member porcupine caribou herd has used the coastal plain as a 
calving area for centuries. In all, more than 200 animal species call 
the refuge home.
  Tragically, the bill before us today threatens to permanently mar 
Alaska's Coastal Plain by permitting destructive oil and natural gas 
exploration. Under a broad pretext of jobs, economic development, and 
international security, some want to enable gigantic energy interests 
to irreparably harm the sanctity of this area. What will be taken can 
never be replaced, and we ought not allow exploration to occur.
  The State of Alaska has been blessed with abundant natural resources, 
and on the whole we, as a nation, are stronger for much of the enormous 
development which has occurred there.
  Depending on who you ask naturally, the prospects for a substantial 
oil find on the coastal plain vary. Nineteen percent, Forty percent, 
the estimates, by definition, are inexact. Proponents of development 
believe that under the tundra lies the next Prudhoe Bay discovery, the 
next North Sea field. Fueled by projections of a skyrocketing demand 
for oil by the developing world, energy interests are waiting with 
bated breath.
  Yet, of the more than 1,100 miles of northern Alaska's coastline, the 
coastal plain is the only 125 miles closed to development. Isn't this a 
small, justifiable sacrifice. Isn't there a point where we draw the 
line and protect a unique area because there is value beyond the price 
per barrel.
  Let us assume for the moment that perhaps there is some merit in 
development, and let us further use Prudhoe Bay as a case study of 
likely consequences. Though for the most part drilling in the bay is 
reasonably managed, oil spills still average 500 annually--that is 
nearly 10 spills per week. This activity seems to also be having an 
impact on the surrounding wildlife. An article in the October 21 
edition of the Anchorage Daily News noted that a new State caribou 
survey has found a sharp decline in the central Arctic caribou herd 
indigenous to the area. The cause is unknown, however, recent research 
by the University of Alaska has found that caribou living near the oil 

[[Page S 16088]]
fields have far fewer calves than those away from the facilities.
  If this is in fact the case, the adverse effects of oil activity 
would be magnified in the coastal plain. What will exploration bring? 
Hundreds of miles of roads and pipelines leading to dozens of oil 
fields, blocking wildlife migration. Toxic wastes leaking into the 
soil. Rivers and streambeds robbed of millions of tons of their gravel 
to construct roads and runways.
  According to Interior Department estimates, oil exploration would 
likely result in a decrease or change in distribution of 20 to 40 
percent in the caribou population, 50 percent in the numbers of snow 
geese, and 25 to 50 percent in the muskox populations.
  And after the oil has dried up, after the companies have gone, what 
will be left? The footprint of industrial development: abandoned 
drilling equipment scarring the landscape; toxic contamination; lost 
wildlife; a horizon permanently altered.
  I have heard proponents argue that opening the coastal plan is a 
critical step toward decreasing our growing dependence on foreign oil. 
Yet, many of these same proponents are now moving a bill through the 
Congress to start exporting the oil presently extracted from Alaska's 
North Slope.
  Mysteriously, this concern about our dependence on foreign oil also 
seems to evaporate when it comes to investment in research and 
development of alternative fuels, such as solar and wind energy.
  Protection of our wilderness should not be a Democratic issue, or a 
Republican issue. In fact, the entire National Wildlife Refugee System, 
or which the Arctic Refuge is a part, was begun in 1903 by one of the 
greatest conservationists in our history, President Teddy Roosevelt, a 
Republican. The coastal plain was part of the original wildlife refuge 
established by President Eisenhower in 1960. Regrettably, red ink 
bleeding from Alaska's budget and the power of a few special interests 
have polarized this debate.
  Every American has a stake in our National Wilderness Areas, in the 
preservation of the environment in which we all live, Every acre 
offering the possibility of oil ought not be drilled, every mountain 
offering the possibility of gold ought not be mined, every mile of 
wilderness ought not be stripped bare just because its value can be 
quantified, just because revenue can be raised.
  Due to the fragile and complex interconnection of ecosystems, our 
future is inextricably linked to nature's vitality. If the scale is 
tipped too far by overdevelopment and we lose our balance, no amount of 
money will enable us to restore what we have lost.
  We must remember that we are but visitors in this land, existing by 
the good grace of Mother Nature--a lasting, sustainable society for all 
future generations depends upon it.
  Mr. COHEN. Mr. President, I have enormous respect for my Republican 
colleagues for producing this historic budget. For the first time in a 
generation the Senate is presented with a plan that actually balances 
the budget.
  Earlier this year, opponents of the balanced budget amendment charged 
that the amendment was a gimmick designed to allow Members to say they 
support a balanced budget without having to explain exactly how to 
achieve this.
  I am proud that these critics have been proven wrong. Despite the 
loss of the balanced budget amendment, this Republican Congress has 
persevered in producing a specific plan to balance the budget in 2002--
the same year called for in the balanced budget amendment.
  The spending cuts called for in this plan are significant, and many 
of them are well overdue. My concern is with the tax cuts. I do not 
think we should be cutting taxes at the same time we are trying to 
balance the budget.
  Trying to do both at once is like driving with one foot on the gas 
and the other on the brake.
  I think the tough cuts proposed in this plan would be more easily 
justified without the tax cuts.
  Any way you look at it, because of these tax cuts, the Federal 
Government will have to borrow $245 billion more over the next 7 years 
than it otherwise would. This is particularly troubling in light of the 
fact that, if no changes are made in the Federal budget, children born 
today will face a lifetime tax burden of 82 percent. Such a tax burden 
is clearly unsustainable and intolerable.
  Paying for tax cuts with borrowed money is really more of a tax 
deferral than a tax cut. At some point, future taxpayers will be forced 
to pay back the $245 billion and their tax burden will be higher than 
it otherwise might be.
  If the effect of borrowing money for tax cuts today is to increase 
the tax burden on future generations, the entire purpose of balancing 
the budget is undermined. We will still be asking our children to foot 
the bill. Balancing the budget is itself a tax cut in that it would 
relieve families of the hidden taxes associated with servicing the 
national debt. Interest on this debt costs the average household over 
$800 a year. Balancing the budget more quickly and forgoing a deficit-
financed tax cut would ease the burden of these hidden taxes. Balancing 
the budget more quickly would also lower interest costs for mortgages 
and student loans--saving families thousands of dollars.
  Congress must focus on increasing the national savings rate. The 
surest way to achieve this goal is by reducing the deficit and by 
fundamentally reforming the tax code. The tax cuts proposed in the 
pending bill would frustrate both of these goals. The Tax Code would be 
complicated further and the deficit would be $245 billion larger.
  Let me be clear. If not for the budget deficit, I too would support a 
broad-based tax cut. I am no fan of higher taxes. I opposed President 
Clinton's deficit plan because it relied too heavily on tax increases 
and not enough on spending cuts. It is one thing to oppose further tax 
increases. It is quite another, however, to support large tax cuts in 
the face of looming deficits.
  While the size of the tax cuts prevent me from voting for this 
budget, I appreciate the willingness of the majority leader, Senator 
Domenici and Senator Roth to work with me and other Senators to make 
some important changes to the bill affecting the education and Medicaid 
programs. In addition, important Federal nursing home standards were 
maintained. While these improvements were substantial, they could not 
offset my overarching concerns with cutting taxes by $245 billion at 
this time.
  I am confident that the Senate will have an opportunity to consider 
another balanced budget plan this year. The budget in its current form 
will almost certainly be vetoed by the President. Subsequent to this 
veto, I look forward to working with my colleagues to craft a new plan 
that maintains the goal of balancing the budget without cutting taxes 
by $245 billion.
  Mr. SPECTER. Mr. President, I am voting in favor of final passage of 
the budget reconciliation bill because I believe the prospective 
benefits of balancing the budget outweigh the concerns expressed in my 
floor statement of October 24, 1995. As indicated by that statement and 
my votes on individual amendments, I believe the bill would have been 
fairer with more funding for Medicare, education, and Medicaid without 
the tax cuts. OK, the tax cuts should have gone to deficit reduction. 
But, on balance, the bill should be passed.
  At the insistence of our group of centrist Senators, this bill has 
been materially improved by floor amendments which did add some 
significant supplemental funding for Medicaid, Medicare, and education.
  It is my expectation that further improvements are likely in the 
House-Senate conference with additional funding for Medicare and 
recipients of the earned income tax credit, because the House of 
Representatives has higher figures in those accounts.
  After the House-Senate conference and the expected Presidential veto, 
it is likely that the ultimate legislation will better address the 
fairness issue and provide better assurances that tax cuts will not 
undermine a balanced budget.
  Passage of this bill by the Senate today will move the process 
forward and promote the primary objective of balancing the federal 
budget by the targeted year of 2002.
  Mr. BIDEN. Mr. President, a nation's budget reveals its fundamental 
values, its priorities, the problems that most concern its people. A 
budget can tell us a lot about how a nation's resources will be 
shared--which people, what activities will bear the tax burdens, and 

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which people, which activities will be encouraged and rewarded.
  We are debating here today perhaps the most important budget plan in 
my public career. This is the first time we have committed ourselves to 
a 7-year budget plan, and the first time we have committed ourselves to 
a path which ends in a balanced budget. If--and this is a big if--we 
stick to it, this budget will control our actions through the end of 
this century and beyond.
  What statement does this document make about our country? What does 
this reconciliation bill say about our concerns, what does it say about 
our values?
  Mr. President, as we debate this bill we face a number of fundamental 
problems in our country. High on the list of worries of the middle-
class men and women I talk to in my State of Delaware is the need to 
restore faith in the American dream--a belief that their own hard work 
will earn them a decent living today, that their mothers and fathers 
will enjoy a secure and dignified retirement, and that there will be a 
better world for their sons and daughters.
  And just as high on that list of Americans' concerns is a need to 
restore Americans' sense of fairness--a sense that we have a system 
that gives the average guy a fair shake, that does not turn its back on 
those who are less fortunate, a system in which the most fortunate meet 
their obligation to contribute to our shared needs.
  This is a value increasingly at risk today.
  How does this budget respond to those concerns, Mr. President? How 
does it reflect those middle-class values?
  I am sorry to say that this budget will give middle-class Americans 
more reason to worry about the future. It weakens the foundation of 
future growth by making it harder for our children to get the education 
they need to become part of a high wage, high productivity, world class 
work force.
  The lower, slower growth that is the inevitable result of this 
reconciliation bill will contribute to a further hollowing out of our 
middle class--an expanding gap between the few whose families can 
afford a more expensive ticket to a better future and those who cannot.
  A weakened middle class increases social instability, and leads to 
the very real concerns about the future that we now see in the polls, 
and in our streets.
  It threatens Americans' ability to control their own fate--no matter 
how hard they work, a weaker, slower growing economy will mean smaller 
wages and salaries, a bleaker future.
  As unwise, as reckless as this bill is in its threat to our current 
and future standard of living, Mr. President, it is unconscionable in 
its abandonment of our commitment to our parents' generation.
  It raises the cost of getting old in America, Mr. President. This 
reconciliation bill is a dark cloud over what should be the golden 
years of the generation that made us into a world power, that passed on 
to us the richest, most powerful country in the history of the world. 
How do we repay their hard work and sacrifice on our behalf?
  This bill raises the cost of Medicare and Medicaid, and removes 
nursing home standards that demand basic human decency. It cuts more 
than $270 billion from Medicare over the next 7 years. Already today, 
seniors pay an average of 20 percent of their income for health care. 
This plan, will increase the premiums of a senior couple an additional 
$2,800 over the next 7 years.
  This reconciliation bill continues to dump the burden on a middle 
class that is already getting clobbered. For more than a decade and a 
half, the median income in this country has been stuck in neutral--
along with housing, the costs of education and health care are 
squeezing everything else out of middle-class budgets.
  This bill increases health care costs of the retired parents of hard-
working middle-class families. What are they going to do when grandma 
and grandpa come home and tell them that they will have to pay more out 
of their own fixed incomes to visit their own doctor? Will they turn 
their parents away? We all know the answer to that question, Mr. 
President--thank God, those middle-class families are going to remember 
their parents' sacrifices for them and for this country, and they are 
going to reach into their pockets and cover the new costs imposed by 
this bill.
  At the same time, they are going to have to pick up the tab for more 
expensive college loans. It is the old squeeze play, Mr. President, and 
guess who is in the middle?
  The saddest thing about this reconciliation bill may well be the 
missed opportunity it represents. I voted for the balanced budget 
amendment. I support not one, but two different budget resolutions that 
could have brought us to a balanced budget by the year 2002, the same 
target at which this reconciliation bill is aimed.
  So I wish I could vote for a plan that would reach that goal. There 
are many possible plans, many possible paths to that goal. Some of 
those paths to a balanced budget would leave us a stronger, more 
competitive, and fairer country.
  This one will not.
  The question is not whether we should balance the budget. The 
question is not whether there must be sacrifice and change in the way 
we do business here. And for me, there is no question that we should 
make room for tax cuts, though more carefully drawn and targeted than 
those here before us today.
  The question is how should we share the burden of the necessary 
sacrifice among the American people, and how should we allocate the 
necessary spending cuts to assure stronger, faster economic growth in 
the future.
  This reconciliation bill has the wrong answers to those questions, 
Mr. President. It dumps the burdens of deficit reduction on those least 
able to bear it--deepening, not healing, the growing rifts in our 
society. And its short-sighted priorities--raising the cost of 
education, reducing health care and nutrition to the poorest children--
weaken our ability to respond with a healthy, smarter workforce to the 
challenge of international economic competition.
  I tried, along with a lot of my colleagues, to fix this bill. I 
offered an amendment that would give a $10,000 tax deduction to help 
middle-class families pay for the rising costs of a college education. 
I tried to reduce the fraud in the Medicare system--to save money that 
could have prevented some of the worst cuts this bill will impose.
  I supported many other attempts to restore some fairness, some common 
sense, some more balanced priorities to this bill. Those attempts were 
defeated.
  We are left with this fatally flawed bill.
  And a final point, Mr. President. As someone who voted for the 
balanced budget constitutional amendment, I might be moved to overlook 
some flaws in a plan that offered real promise of bringing the Federal 
deficit down to zero. Unfortunately, this plan uses a bunch of budget 
gimmicks too long to list here to maintain an appearance of budget 
balance that may well never become a reality.
  Most disturbing to me is the fact that only by counting the surplus 
in the Social Security System will this plan bring the deficit to zero 
in the year 2002. Without counting Social Security funds as part of the 
Federal Government's everyday income, something that is not permitted 
under our current budget laws, the Republicans' own Budget Office has 
told them that this budget will be out of balance by $105 billion in 
2002.
  But there are other problems, Mr. President--such as the heavy ``back 
loading'' of the spending cuts. This budget saves the real pain for the 
6th and 7th years of this plan--a point when virtually no one here 
today would have to face the need to cut over $200 billion each of the 
last 2 years. Let us hope there will be more enthusiasm for those 
choices then, than there appears to be now.
  This bill's gimmicks include asset sales--to make the books look 
better in the short run, but that will leave us poorer in the future. 
Again, this is a practice that should not be allowed under budget law, 
but it is in here nonetheless.
  So this reconciliation bill does not express the values of the 
Americans I know, the values of the people of Delaware. It does not 
embody the principles of mutual obligation, of family continuity that 
the Americans I know share. It is an affront to any notion of family 
values.
  It does not address middle-class Americans' valid concerns about the 

[[Page S 16090]]
  future of our economy, and it does nothing to help us build the well-
paid, high-productivity work force that will allow us to take control 
of our destiny.
  Because I know we can do better, Mr. President, and because the 
American people deserve better, I will vote against this bill.
  Mr. CHAFEE. Mr. President, this reconciliation bill is the 
culmination of the congressional budget process. It provides for a 
balanced budget within 7 years, a truly remarkable feat.
  The next step will undoubtedly be direct negotiations between 
congressional principals and the President to reach a final budget 
accord. However, that cannot occur until this legislation has been 
passed in final form, and sent to the President. And the quicker, the 
better, in my view.
  While I do not agree with every aspect of this reconciliation bill, 
the objective of achieving a balanced budget far outweighs any 
misgivings I have about various of its provisions. We do not always get 
everything we want in the legislative process. Achieving the greater 
good must also be a consideration; and, here, the greater good is to 
obtain a balanced budget.
  For 33 straight years this Government has spent more than it has 
taken in. The cumulative consequence of our annual budgetary sins is an 
incredible $5 trillion national debt--literally, a mortgage on the 
economic future of our children and grandchildren. This is immoral, and 
must stop.
  Every week, the Treasury Department must issue debt securities to 
keep the Government afloat. This past Monday, for example, Treasury 
borrowed $27 billion to cover maturing securities, and to raise needed 
cash. The Department must hold monthly, quarterly, and annual auctions 
just to maintain solvency. If we make no changes to the course we are 
currently on, we will run $200 billion deficits each year well into the 
next century. Fully 15 percent of our annual Federal budget--$235 
billion--must now go to paying the interest on this massive debt, 
without a penny of that going to reduce the principal. Within 10 years 
annual interest costs will jump to $400 billion.
  This must stop.
  Those of us in Congress, who have struggled over the years to reverse 
this ruinous course, are rightfully frustrated. In 1985, we passed the 
Emergency Deficit Control Act, also known as Gramm-Rudman-Hollings. 
That law was supposed to deliver a balanced budget by 1991. It did not 
happen. In 1990, we passed the Budget Enforcement Act, establishing the 
discretionary spending caps and the pay-as-you-go rules for entitlement 
spending and tax cuts. The results are barely measurable. Despite our 
best efforts, deficit control continues to elude us.
  Regrettably, we cannot balance the budget this year or next. However, 
with the bill before us, we will balance the budget by the year 2002. 
And, from there, we can hopefully go on to commence retiring the 
staggering national debt that will remain.
  Is this bill perfect? No, it is not. I am not aware of any Senator 
who is satisfied with every aspect of this 1,900-page bill. In my view, 
at a time when we are struggling to reduce the deficit and asking 
people to sacrifice, the tax cuts are ill-timed. Earlier this year, 
during the debate on the Budget Resolution, a number of moderate 
Republicans--myself included--sought to discourage the tax cuts. That 
effort was complicated by the fact that the President's own budget 
called for tax cuts totaling more than $105 billion. During the Finance 
Committee deliberations last week, I was the lone Republican voting to 
eliminate or scale-back the tax cuts. Unfortunately, my view did not 
prevail.
  I have also been clear in my objections to block granting the 
Medicaid Program. I took steps in the Finance Committee to ensure that, 
at a minimum, pregnant women and children with incomes below the 
poverty level, as well as the disabled, retain some minimum guarantee 
of services.

  In that regard, I am pleased my amendment to clarify the definition 
of ``disability'' passed the Senate yesterday by a vote of 60-39. 
Similarly, I am gratified the Senate this morning rejected, by a vote 
of 21-78, an amendment to strike my guarantee provisions for low-income 
pregnant women and children, as well as the disabled. These votes place 
the Senate squarely on record in support of requiring states to 
guarantee services to these vulnerable populations.
  As a result of negotiations with the majority leader, moderate 
Republicans have been able to obtain a number of other improvements to 
the Medicaid package over the past several days. These include 
retaining Federal standards for nursing homes, a set-aside for low-
income Medicare beneficiaries, and requiring that the same solvency 
standards a state applies to private plans must also be applied to 
Medicaid plans. We were also able to obtain a provision to permit the 
integration of services for elderly and disabled individuals who are 
both Medicare and Medicaid-eligible. Finally, we also won inclusion of 
an additional $10 billion in funding to the States under the revised 
Medicaid Program, and $2 billion more in Medicare payments to teaching 
hospitals.
  I am also pleased that we were able to reach an agreement with the 
majority leader to eliminate the proposed reductions in Federal student 
loan programs that most directly effect students, parents, and schools. 
This occurred yesterday with the passage of the Kassebaum amendment, 
which restores the interest exemption ``grace period'' for newly 
guaranteed students, retains the current interest rates on ``plus'' 
loans to parents, and drops the new fee based on student loan volume 
that schools would be required to pay. We must not burden families 
further by making student loans more costly.
  Despite these improvements, I still have some serious objections to 
S. 1357. Nonetheless, I will vote for this reconciliation measure. 
Moreover, I will vote against any amendments which I believe will delay 
or prevent this legislation from reaching the President's desk at the 
earliest possible time.
  The new fiscal year started over 3 weeks ago, numerous appropriations 
bills remain outstanding, and the short term continuing resolution we 
passed last month will soon expire. My objective is to expedite getting 
to the endgame--to the bargaining table with President Clinton--where 
the real negotiations and work can commence on the terms of a final 
agreement to balance the budget.
  While one may or may not agree with this package, it definitely does 
not represent business as usual. In fact, it is a bold, politically 
risky initiative, without precedent in my memory. This is the first 
serious attempt to constrain the explosive growth of Medicare and 
Medicaid; to cap and reform farm subsidies; and to delay the cost of 
living adjustments for Federal retirees. These deficits are a cancer, 
and this bill is the chemotherapy. It's painful medicine, but it is 
necessary.
  During hearings earlier this year in the Finance Committee, a number 
of distinguished economists testified on fiscal policy and the state of 
our economy. Nearly every one of these witnesses, including Federal 
Reserve Board Chairman Alan Greenspan, said that balancing the budget 
is the single most important step we in Congress can take to help the 
economy. The benefits that flow from balancing the budget include 
increased employment and wages, greater investment and productivity, 
and lower long term interest rates.
  Once we get on a glide path to a balanced budget, which can only come 
from hard negotiations with the President, our economy will begin to 
see some of these improvements. As interest rates drop, borrowing to 
buy a house, or to finance a college education will become more 
affordable. With less government borrowing, there will be more capital 
available for small businesses to expand, and to hire more people. Real 
wages, now stagnant, will begin to grow again, and our standard of 
living will gradually begin to improve.
  In summary, Mr. President, we must take bold steps now. We cannot 
continue to pile ever greater debt burdens on our children and 
grandchildren. Thank goodness we finally have a legislative proposal 
that will reverse this ruinous course.
  Mr. FEINGOLD. Mr. President, the 2000 page reconciliation measure 
that the Senate passed is deeply flawed.
  It is a massive work, and difficult to comment on in any serious, 
detailed way because making an assessment of the reconciliation bill 
really amounts 

[[Page S 16091]]
to assessing the individual components of the measure, as well as the 
proposal as a whole.
  On both counts, this bill is troubling.
  Mr. President, last May, during consideration of the budget 
resolution, I shared my own perspective about the direction we should 
pursue to balance the budget.
  I argued that part of our effort should include changes to Medicare, 
and I identified areas where some savings could be realized.
  I also noted that some in the Majority party were undermining our 
ability to make these reforms by failing to play straight with the 
American people, implying that cuts to Medicare are needed solely to 
keep the Medicare Hospital Insurance Trust Fund solvent.
  That portrayal was, and is, entirely misleading, as, of course, it 
was meant to be.
  For though some changes are needed to keep the Hospital Insurance 
fund solvent, that trust fund is not the entire story.
  Savings in Medicare must also be found as part of the broader effort 
to reduce the deficit and balance the Federal budget.
  Mr. President, I made this point last May, and I make it again today 
because I fear that the political spin doctors who have chosen to 
depict Medicare cuts as being apart and separate from the rest of the 
budget are doing a great disservice to the cause of deficit reduction.
  In an effort to minimize the political fallout that is inevitable if 
Congress cuts Medicare, they may undermine any chance for a budget 
package that will achieve the consensus it must have if we are to make 
the politically tough decisions needed to balance the Federal budget.
  Mr. President, we need to be honest with the American people.
  The Hospital Insurance Trust Fund does need to be shored up, but that 
is not the only reason we need to find savings in Medicare.
  Nor is the impending insolvency of the trust fund something new.
  The Hospital Insurance Trust Fund has been within a few years of 
insolvency every year since 1970.
  Mr. President, Congress has been dealing with that problem off and on 
for 25 years now. I understand that it will take about $90 billion in 
savings over the next 7 years to extend the trust fund's solvency to 10 
years, about one third of the total reduction proposed by the majority 
part.
  But the trust fund solvency is not the whole story, despite what some 
want the American people to believe.
  Medicare clearly has an impact on the budget, and part of the reason 
cuts are being proposed stems from our Federal budget deficit. And 
rightly so.
  Mr. President, Medicare is not Social Security. It should be on the 
table with other areas of Federal spending.
  Mr. President, I have sponsored legislation that includes Medicare 
changes. Medicare changes were part of the 82+ point plan to reduce the 
deficit I offered during my campaign for the U.S. Senate in 1992.
  More importantly, I have voted for legislation that contained 
significant, specific changes to Medicare twice during the 103d 
Congress.
  The reconciliation legislation we passed as part of the President's 
deficit reduction package included nearly $60 billion in Medicare cuts.
  I also voted for, and was proud to co-sponsor, the bipartisan Kerrey-
Brown deficit reduction package which also included significant, 
specific Medicare cuts.
  And, Mr. President, I am willing to vote for Medicare cuts again. But 
not the $270 billion in cuts that are proposed in this measure.
  Mr. President, last May I laid out a number of specific areas in 
which I thought savings could be realized. I was pleased to see a 
number of those ideas included in the Medicare provisions of the 
reconciliation bills that have been made by the Senate Finance 
Committee.
  These included changes in the reimbursement of capital-related costs 
of inpatient services; repairing the flawed reimbursement formula that 
results in overpayments for some outpatient services; and, establishing 
a new prospective payment approach for home health care services.
  I was pleased as well to see that the Finance Committee proposal 
includes some improvement in the reimbursement formula for Medicare 
HMOs.
  The current formula rewards inefficient health care markets and 
punishes efficient health care markets and those areas, like many rural 
areas, that have inadequate service capacity.
  For Vernon County, WI, about an hour west of my home, the Medicare 
formula would reimburse an HMO about $211 per month per enrollee. That 
is just a little bit more than half of the national average of $400 per 
month.
  Mr. President, it should not surprise my colleagues to know that 
there are no Medicare HMOs in Vernon County. By contrast, in Miami, 
Medicare HMOs receive about $615 per month for every enrollee, nearly 
three times as much as in Vernon County.
  At triple the reimbursement of Vernon County, it is little wonder 
that HMOs in places like Miami are able to offer the wonderful 
additional benefits to which proponents of Medicare HMOs point when 
arguing for expanded use of managed care in Medicare, benefits like 
prescription drugs, eye glasses, and dental services.
  Though it remains to be seen whether or not the Finance Committee's 
changes to the formula will be sufficient, the blended formula approach 
appears to move in the right direction.
  I also want to commend the authors of the Senate proposal, and of the 
Ways and Means plan, for asking higher income Medicare beneficiaries to 
pay a larger share of the cost of their Medicare part B services.
  I proposed that very reform in 1992, as part of my 82+ point plan to 
reduce the deficit and balance the budget, and am glad to see it 
included in the two proposals.
  Mr. President, I endorse this change. It should be made in order to 
help reduce the deficit.
  But those who have sought to avoid criticism of this and other 
Medicare changes have used the pretense of the impending insolvency of 
the Medicare trust fund, and in doing so they have done no favors to 
the cause of deficit reduction.
  Far from it.
  By misrepresenting the facts to the American people, they have 
undermined and jeopardized the already politically difficult, but 
nevertheless necessary task, of reforming Medicare.
  Mr. President, the problems created by deliberately misleading people 
about the real need for Medicare reforms are compounded by a number of 
flawed, even harsh provisions.
  These include the across-the-board increase in part B premiums and 
deductibles.
  Unlike the means-tested premium increase on upper income 
beneficiaries, which I support, the across the board increases in 
premiums and deductibles hits lower income seniors and disabled.
  Mr. President, the median income of elderly households is less than 
half that of non-elderly households. And incomes for the oldest old are 
by far the lowest of any age group.
  Households headed by someone aged 75 or older had annual median 
incomes of less than $13,622 in 1992--$4,000 lower than the next lowest 
income group, those of households headed by people between age 15 and 
24.
  And over one-fourth of the elderly households have incomes of less 
than $10,000 per year.
  Mr. President, while the elderly are disproportionately poor, they 
also spend far more on health care as a group than anyone else, and 
this should not surprise us.
  What may be surprising to some, however, is just how much our seniors 
do pay already even with Medicare. In 1995, the average older 
beneficiary will spend about $2,750 out-of-pocket for premiums, 
deductibles, copayments, and for services not covered by Medicare.
  I might add, Mr. President, that these costs do not include the 
potentially crushing costs of long-term care which can total nearly 
$40,000 in some areas for nursing home care.
  The across-the-board increases in premiums and deductibles will only 
add to these already high out-of-pocket costs.
  Mr. President, let me add that under the current protections in our 
Medicaid program for lower income Medicare beneficiaries, some of the 
impact on the poorest of our elderly would be softened, but the 
reconciliation measure eliminates the guarantee of help for those 
beneficiaries. 

[[Page S 16092]]

  Mr. President, rural seniors are among the most at risk under this 
legislation.
  Because rural areas depend on Medicare to support an already 
inadequate health care service capacity, the massive Medicare cuts hit 
rural seniors and providers especially hard.
  Making matters worse is the so-called Budget Expenditure Limit Tool, 
or ``BELT'' provision included in the bill which provides for automatic 
cuts in the traditional Medicare fee-for-service program if budget 
targets are not met.
  Despite the improvements made to the Medicare HMO reimbursement 
formula, rural beneficiaries will continue to rely much more heavily on 
the traditional Medicare fee-for-service program than their urban 
counterparts, placing them at special risk because of the BELT 
provision.
  Mr. President, as bad as the Medicare cuts are, the Medicaid cuts may 
be even worse.
  Again, reforms to the current Medicaid program are clearly needed, 
not only to improve services for those lower income families needing 
health care, but also to reduce the pressure on our budget deficit.
  But the $182 billion in cuts proposed in this bill are unacceptable, 
as is the loss of the current Federal protections that ensure safe 
nursing home care, guarantee help for the poorest Medicare 
beneficiaries, and provide the critical safety net of health care 
services to poor women, children, and the disabled of all ages.
  Though spousal impoverishment protections were retained in the 
provisions reported by the Finance Committee, I am extremely concerned 
about the prospects for spousal impoverishment when this measure goes 
to conference.
  Comments made by the Speaker indicate that spousal impoverishment 
protections are very much at risk.
  Mr. President, I am equally concerned about reports of a little known 
change in the law that permits States to bill the adult children of 
those elderly needing long-term care services.
  This smacks of a return to the days of bills of attainder and 
workhouses for the families of those unable pay their debts.
  Much has been said on other protections that have been eliminated and 
I will not repeat the arguments that have been made.
  But, Mr. President, it is apparent that those seeking to tame our 
Medicaid budget do not understand the underlying forces which 
contribute to the bulk of Medicaid growth, namely the rapidly 
increasing need for long-term care services.
  Though the elderly and disabled make up about one quarter of the 
Medicaid population, they account for 59 percent of the Medicaid 
budget, with the bulk of expenditures for them going to long-term care 
services.
  Pressure on the long-term care budget will only increase.
  Our Nation faces a rapidly growing population needing long-term care 
services, a population which is disproportionately poor.
  The answer, Mr. President, is not to turn Medicaid into a block grant 
program, imposing a unilateral cut, and shoving responsibility for 
those left without services onto the States.
  The answer is fundamental long-term care reform.
  Along with Senator Paul Simon, I introduced a comprehensive long-term 
care reform measure, S. 85, that would be an important first step in 
helping States deal with this growing problem.
  It is based on the bipartisan reforms we made in Wisconsin during the 
1980's, where we established consumer-oriented and consumer-directed 
home and community-based services that allow those needing long-term 
care to remain in their own homes and communities.
  Those reforms helped bring Wisconsin's Medicaid budget under control, 
and saved taxpayers hundreds of millions of dollars. Between 1980 and 
1993, while Medicaid nursing home use increased by 47 percent 
nationally, in Wisconsin Medicaid nursing home use actually dropped 15 
percent.
  This is the kind of national long-term care reform that is needed to 
tame the Medicaid budget, offered a version of that proposal as an 
amendment to this bill, but that amendment was defeated.
  Mr. President, other provisions of the reconciliation bill are 
significantly flawed.
  According to the Treasury Department, the bill's cuts to the Earned 
Income Tax Credit amount to nothing more or less than a tax increase on 
17 million low-income, working Americans.
  In my own State of Wisconsin, some 206,000 families will experience a 
tax increase of $330 on average in 2002, according to Treasury figures.
  The assault on the Student Loan Program is also troubling.
  The new limitation on direct lending programs adds real injury to 
this insult, making it even more difficult for families to send their 
children to college.
  Mr. President, as disturbing as the provisions contained in the 
measure are those which are not such as the lack of effective change to 
the Federal Milk Marketing Order system.
  Mr. President, the provisions in this bill with respect to dairy 
policy could not be any worse for the Upper Midwest. The provisions 
reported by the Agriculture Committee dramatically reduce the support 
price for milk, cutting the dairy price support program more than any 
other commodity on a proportionate  basis. The dairy program which 
accounted for less than two percent of commodity program spending in 
1994, took 9% of the cuts made by the Agriculture Committee in this 
bill. Those cuts could have been acceptable, Mr. President, if the 
inequities and market distortions of the Federal Milk Marketing Order 
system that have discriminated against the Upper Midwest had been 
addressed by the Committee.

  Unfortunately, the Agriculture Committee abdicated their 
responsibility on Market Order reform and left the system intact, 
leaving in place a bill that pulled the rug out from under 
manufacturing prices for the Upper Midwest, and leaving in place the 
excessive subsidies for fluid milk in other regions of the country.
  Unfortunately, Mr. President, this bill did not stop there. Instead, 
during floor action, the Senate granted its approval to the Northeast 
Interstate Dairy Compact which will allow six northeastern states to 
set artificially high prices for milk paid to their producers. Mr. 
President, to my knowledge, this is the first time that Congress has 
granted approval to a price-fixing Interstate Compact. The Compact 
erects walls around the Compact states, preventing lower cost milk 
produced outside the Compact region from entering those six states. It 
is protectionism in its worst form. This compact also provides a 
subsidy to Compact-state processors who are forced to pay this higher 
price for milk, in order to allow them to ship their products outside 
the compact and remain competitive. Those compact products, produced 
and exported with the subsidy, will then compete with products produced 
by processors and producers in other states that have not been granted 
this special privilege.
  The Compact, Mr. President, is inherently market distorting, 
regionally discriminatory, and overly regulatory. I think this body 
will regret providing its approval to this arrangement.
  Unfortunately, the Senate included another provision during floor 
debate that further worsens the inequities of the current system. The 
Senate approved a Class IV pricing scheme for inclusion in Federal Milk 
Marketing Orders which taxes all producers nationwide to support the 
overproduction of a couple of West Coast states. The Upper Midwest 
dairy producers and processors overwhelmingly oppose this provision 
because it adds just another layer of regulation to the already 
discriminatory milk marketing order system. It will reduce prices for 
all producers nationwide in order to pay for the surpluses produced on 
the west coast. Wisconsin producers, while being denied an opportunity 
to share in the benefits of the highest class of milk, Class I milk, 
will now be required to suffer the loss of the lowest priced class of 
milk, even though they are not responsible for its production.
  Mr. President, this bill represents the worst possible outcome for 
the Upper Midwest dairy industry, and in particular, for Wisconsin 
dairy farmers. In short, Mr. President, the Senate approved some very 
bad policy which appears inconsistent with the principles of many 
members of this chamber and which is completely out of step with 

[[Page S 16093]]
the dairy marketing conditions of the 1990's.
  Another area in which this bill remains far too silent relates to the 
lack of discipline imposed on our U.S. tax code. I am particularly 
disappointed at the weak effort made to address the rapidly growing 
spending done through the tax code.
  Along with tax cuts and defense spending, these tax loopholes are 
sacred cows in this budget.
  At $400 billion and growing, these tax expenditures are among the 
most important areas of Federal spending, and they are hardly touched 
in the reconciliation bill before the body.
  Mr. President, many of the tax expenditures are certainly worthy, but 
others are hard to justify.
  Just like the inappropriate subsidies made through direct 
appropriations, many tax expenditures not only put pressure on the 
budget deficit, they also distort the market place, lowering overall 
economic efficiency of the Nation.
  But, despite the clear need for careful scrutiny in this area, made 
all the more timely by our common goal of reducing the deficit, tax 
expenditures are largely given a free pass.
  Mr. President, it is obvious to all that the massive cuts to Medicare 
and Medicaid--nearly a half trillion dollars over the next 7 years--are 
far more than are necessary to address our budget deficit, and in fact 
make it more difficult to enact a budget plan that will balance the 
Federal books.
  Nor can the health care system that provides care for the most 
vulnerable in our Nation be safely and prudently sustained with this 
kind of revenue loss.
  The question occurs--why are these harsh cuts being proposed to the 
health care programs for our most vulnerable?
  Mr. President, the inescapable conclusion is to fund a fiscally 
irresponsible quarter of a trillion dollar tax cut.
  Mr. President, this tax cut not only jeopardizes the fundamental 
missions of Medicare and Medicaid to provide health care for retirees, 
poor women, children, and the disabled of all ages, it also jeopardizes 
efforts to balance the Federal books.
  Mr. President, if there were no quarter of a trillion dollar tax cut, 
we could develop a bipartisan budget plan, including reductions in 
Medicare and Medicaid, that would balance the Federal books by 2002 or 
even sooner.
  Mr. President, if there were no quarter of a trillion dollar tax cut, 
Medicare and Medicaid beneficiaries, and others, would be far more 
receptive to calls for sacrifice, especially if they are told, honestly 
and straightforwardly, that those sacrifices are intended not just to 
bolster the Trust Fund, but to help get our Federal budget out of the 
red.
  More importantly, Mr. President, if there were no quarter of a 
trillion dollar tax cut, we could fashion a budget plan that would be 
politically sustainable for the time it takes to reach balance and 
eliminate the Federal budget deficit.
  I have no doubt that the deep flaws in the reconciliation measure 
before us jeopardize the very goal the supporters of that measure 
profess--a balanced Federal budget.
  Mr. President, I find similar fault, though to a much lesser degree, 
with the President's original budget as well as his later offering, 
both of which retain a fiscally reckless tax cut, though one which, 
admittedly, is much more modest than is being proposed by the 
Republican leadership.
  We cannot afford either the Democratic tax cut or the Republican tax 
cut, and we could go a long way toward reaching a politically 
sustainable budget agreement that would balance the Federal books by 
2002, and even sooner, if both parties scrapped their tax cut proposals 
and instead focused on eliminating the deficit.
  Mr. President, contrary to the image portrayed by the spin doctors, 
it is the Senate that has produced the most significant reform in this 
Congress.
  Bipartisan efforts in the area of gift ban, lobbying reform, and the 
beginnings of campaign finance reform all have their roots here, in the 
United States Senate.
  I earnestly hope this body will eventually put together the kind of 
sustainable, bipartisan deficit reduction plan that will balance the 
Federal budget before 2002, and do so without harming the most 
vulnerable in society. The key is to eliminate the absolutely 
irresponsible quarter of a trillion dollar tax cut.
  If we can agree to do that, restrain the growth of tax loopholes, and 
put the Defense budget back on the budget table, we will have moved a 
long way toward establishing a responsible glidepath to a balanced 
Federal budget, and elimination of the Federal budget deficit.
  Mr. GLENN. Mr. President, I rise in opposition to the bill. Along 
with many Ohioans, I oppose the large Medicare cuts contained in the 
reconciliation bill and am concerned about their impact on all 
Americans.


                         Medicare and Tax Cuts

  This bill calls for a $270 billion cut to the Medicare program yet 
gives away $245 billion in tax breaks--which disproportionately benefit 
wealthy Americans. I find it alarming that in order to achieve a $245 
billion reduction in taxes, we will slash services for seniors who 
choose to keep their current Medicare coverage.
  This enormous Medicare cut will not balance the budget because it 
goes for a $245 billion tax break. To keep its Contract with America, 
Republicans will break our thirty-year contract that has successfully 
helped older Americans. The lesson here is the old story so often 
reflected in Republican economics: those who have, get; those who do 
not, get stuck.
  The tragedy here is that this massive Medicare cut is unnecessary. We 
all know the 1995 Medicare Board of Trustees report projected that the 
Medicare Part A Hospital Insurance (HI) trust fund will run out of 
reserves in the year 2002. However, the Trustees also reported that 
only $89 billion in savings are necessary to restore the trust fund's 
solvency through 2006.
  The budget plan before us, which was drawn up behind closed doors, 
achieves much of its $270 billion in Medicare savings by cutting 
spending in the areas of inpatient and outpatient services, home 
health, hospice and extended care, physician and ambulatory facility 
services, and diagnostic test and durable medical equipment. For the 
people in my home state of Ohio, this means there will be $8.9 billion 
fewer dollars for health care. For beneficiaries, this cut will mean 
increased premiums, deductibles and co-payments for Medicare Part B 
services--which include many of the services I just mentioned.
  And how are we paying for it? We are going to cut taxes. We squeeze 
$270 billion from the elderly so that we can turn around and give $245 
billion of it away in tax cuts.
  Now we have heard a lot of talk about how this side of the aisle is 
just engaging in demagoguery and class warfare. They tell us their bill 
is not slanted toward the wealthy. They say that this bill distributes 
tax cuts equally, regardless of your income.
  But, the American people know better. They know that just because 
someone says it is so, does not make it so.
  The real horror story of this reconciliation bill lies in the 
numbers. And the numbers the other side has produced just do not add 
up. The numbers do not add up because not only does this proposal cut 
medical care for America's seniors, but it raises taxes on the working 
poor by gutting the Earned Income Tax Credit (EITC). So you need to 
factor in the Republican EITC tax increase when making any 
distributional comparisons.
  When you do that, you will find that people with less than $30,000 
will actually be worse off, come tax time, under this plan. But very 
wealthy taxpayers would be big winners. The wealthiest 13 percent of 
taxpayers--those with incomes above $75,000--would receive 53 percent 
of the Senate tax cut. So the wealthiest 13 percent get 53 percent of 
the benefits. Those making more than $200,000 would gain an average of 
$5,088 per taxpayer in the year 2000. By contrast, those with incomes 
between $20,000 and $75,000 would receive an average tax cut of only 
$320.


                                Medicaid

  The budget reconciliation's treatment of Medicaid is truly alarming. 
Republicans would repeal the current Medicaid program and turn it over 
to the states as a fixed dollar amount block grant--eliminating the 
safety 

[[Page S 16094]]
net for more than eight million pregnant women, children, disabled and 
elderly Americans, and weakening federal nursing home regulations that 
protect the indigent and their families.
  The federal government and the State of Ohio currently share in the 
funding of the Medicaid program and provide more than 1.85 million 
poor, elderly and disabled Ohioans with physician, hospital and nursing 
home care. Under the Republican proposal, Ohio would lose nearly $8 
billion in federal Medicaid dollars over the next seven years. To 
offset these cuts, Ohio would be forced to slash or eliminate health 
services for low-income families and seniors, divert resources from 
other important programs, or raise taxes.
  Many people do not realize that nearly 70 percent of Medicaid 
spending goes toward long-term care for the elderly and disabled. These 
recipients are mostly middle-class Americans who are not aware that 
Medicare and most private insurance policies do not cover long-term 
care. Many become eligible for Medicaid when they quickly deplete their 
income and assets after entering a nursing home where costs average 
$3000 per month. Republican proposals would have abolished laws that 
protect spouses from having to sell their homes and assets to pay for 
nursing home bills, but due to widespread opposition both the House and 
the Senate wisely voted to retain spousal impoverishment protection.
  However, the House version of the Republican Medicaid reform bill 
repeals federal standards for nursing home and institutional care. This 
plan repeals such essential standards as quality assurance systems, 
staffing requirements, restrictions on physical and chemical 
restraints, and nutrition guidelines. I was pleased to support a 
successful Senate amendment which provides for the continuation of 
federal nursing home regulations and I will urge conferees to maintain 
federal standards.
   I support efforts to control the growth of federal health care 
spending, but I do not believe that Republicans should balance the 
budget, and give tax breaks, at the expense of our nation's most 
vulnerable citizens. Reform of Medicare and Medicaid should concentrate 
on strengthening and improving these important programs, not on 
squeezing out the maximum amount of budget savings. Today, when 
millions of Americans face limited access to medical care and live with 
the fear that an illness or loss of a job will leave them without 
health care coverage and expose their families to financial ruin, I 
feel it is essential to expand, rather than limit, access to medical 
care.
  There has been a great deal of debate about priorities in the Senate. 
I am not convinced the plan before the Senate is a fair reflection of 
America's priorities. In fact, it is Robin Hood in reverse. This plan 
to take from the poor and give to the rich might make the Sheriff of 
Nottingham proud, but it will not balance the budget.


                                Education

  The Republican budget cuts student loans by $10.8 billion. This makes 
it much harder for working families and their children to finance a 
college education. If these cuts became law, the school house door will 
be closed for many students willing but unable to afford a college 
education. Other students and their families will see their choices for 
an education narrowed.
  The Republican proposal increases the interest rate on PLUS loans 
taken out by parents. The interest rate on parental loans would 
increase by 1 percent. Families considering PLUS loans are mostly 
working middle-income who make too much to qualify for full 
scholarships but not enough to write a check for tuition.
  The six-month grace period for graduating students would be 
eliminated. Interest would pile up during that period and would be 
added to the loan balance. The bill also charges schools a 0.85% fee on 
loans taken out by their students. This new tax on student loans will 
be passed on to students and their families, either financially or 
through cuts in school programs and services.
  I supported the amendment offered by Senator Kassebaum which restored 
some of the cuts in the student loan program, but it is only a step in 
the right direction and does not go far enough to ensure that working 
middle-income families can afford to provide higher educational 
opportunities for their children.


                               Environment

  I oppose the provision to allow oil and gas leasing of the coastal 
plain of the Arctic National Wildlife Refuge (ANWR).
  The coastal plain of the ANWR is one of our remaining ecological 
treasures, containing 18 major rivers, and providing habitat for 36 
species of land mammals and more than 30 fish species. This pristine 
wilderness cannot be replaced. The impact of oil and gas leasing would 
forever alter this region. While proponents of leasing the ANWR argue 
that America's oil dependency requires this resource, they also 
advocate lifting the ban on exports of Alaska North Slope oil which is 
contained in this legislation.
  Americans are committed to protecting national parks and public 
lands. This commitment extends to protecting the ANWR even if the 
revenues from leasing the area would be dedicated to deficit reduction. 
The U.S. Geological Survey recently reduced its estimate of the 
potential oil yield from this area; therefore, the revenue assumptions 
in this bill may be grossly overstated. However, Mr. President, the 
environmental value of this natural area is far greater than any short 
term economic gain from oil and gas development. I am also opposed to 
provisions in the bill that will override existing environmental laws 
and cripple public health and environmental protections.
  At the same time, this measure contains provisions that continue to 
provide millions in annual federal subsidies to timber, mining, and 
ranching industries. These subsidies not only lack economic 
justification but often cause environmental damage. Several of these 
provisions have been previously defeated or have delayed consideration 
of other bills. Yet, in an effort to escape the notice of the American 
people and circumvent the legislative process these dangerous measures 
have been inserted into this massive reconciliation bill.
  Although this bill contains provisions regarding the Mining Law of 
1872, it fails to ``reform'' the patenting process and continues to 
allow the taxpayers of this country to lose millions in revenues from 
publicly owned lands. In contrast to federal coal, oil, and gas leases 
for which the government receives substantial royalty payments, 
hardrock minerals are virtually given away under a law that has not 
been significantly revised since 1872. This situation is 
unconscionable.
  This measure also contains provisions from a federal grazing bill 
under consideration in the House. These provisions codify grazing 
regulations that were in place prior to Secretary Babbitt's proposed 
grazing revisions. Again, the American taxpayer and our nation's 
environment are the losers.
  For all these reasons Mr. President, I have concluded that I cannot 
support the passage of this legislation and I urge my colleagues to 
oppose the bill.
  Mr. DOLE. Mr. President, this debate has been lengthy, and I will not 
delay a final vote much longer. But I do want to take a minute or two 
to comment on what is a very historic day for the U.S. Senate.
  I have cast over 12,000 votes during my years in the Capitol. Many of 
those didn't have a great deal of impact on Americans, and are hard to 
recall. But some votes you remember forever--they are the votes that 
touch the life of every American, and that change the course of 
history.
  I remember the vote on President Reagan's historic tax cut bill--and 
the vote against President Clinton's historic tax increase bill.
  I remember the vote which made Martin Luther King's birthday a 
Federal holiday--and I was pleased to lead the debate in favor of that 
bill.
  And I vividly recall the vote authorizing President Bush to send 
troops to the Persian Gulf.
  And no doubt about it, the vote we will cast in just a few minutes is 
one we will remember forever.
  It is a vote for putting America on a path to a balanced budget.
  It is a vote for low interest rates, so more Americans can own a 
house, buy a car, and send their children to college.
  It is a vote that will give new life to the 10th amendment, because 
we are 

[[Page S 16095]]
transferring power out of Washington, and returning it to the people, 
where it belongs.
  It is a vote for cutting taxes, and allowing American families to 
keep more of their hard earned money, and to make their own decisions 
on how best they can spend it.
  It is a vote for securing, strengthening, and preserving the Medicare 
Program, on which so many of our seniors depend.
  It is a vote for real, meaningful, and fundamental change.
  And, above all, Mr. President, it is a vote for America's future. For 
our children and grandchildren--and their children and grandchildren.
  It is a vote for the teenager who was in my office a few years back 
with a group of high school students from across the country. And this 
young man said to me, ``Senator, everyone has someone in Washington who 
represents them. Someone speaks for labor, for the farmers, for 
business . . . but no one speaks for us. No one speaks for America's 
future.''

  I do not know where that young man is today, but if he happens to be 
listening, I want to tell him that at long last, someone is speaking 
for you, some one is speaking for American's future. This Republican 
Congress had the courage to look beyond the next election, and ask what 
is best for the next generation.
  But I would also tell this young man that our battle on behalf of the 
next generation is far from over. President Clinton will veto the final 
reconciliation bill that will be reported out of conference, the forces 
of the status quo will do all in their power to return to business as 
usual.
  President Clinton says he wants change. But his actions speak much 
louder than his words.
  He says he wants to balance the budget, and at various times, he says 
he can do it in either 5 years, 10 years, 8 years, or 7 years--but each 
budget he has proposed doesn't balance the budget in 100 years.
  He says he wants to cut taxes for the middle class, but he inflicted 
the largest tax increase in history on the American people.
  He says he wants to save Medicare from its impending bankruptcy, but 
he has refused again and again to join in a bipartisan effort to do so.
  Instead of providing leadership, the President has been content to 
sit on the sidelines and use increasingly harsh rhetoric to scare the 
American people.
  And that rhetoric reached new lows yesterday with the sad remarks of 
the President's press secretary, which I will not dignify by repeating.
  And there is no doubt that these past few days of debate on the 
Senate floor have created quite a few sound bites for the nightly news.
  Some of my friends on the other side of the aisle would have you 
believe that each and every Republican Senator has it out for Americans 
in need.
  I just wish that each time the media reported one of these phony 
accusations, they would follow it up by reporting the truth.
  And the truth is, the Republican plan reins in government spending 
by slowing its rate of growth. The truth is, more than 70 percent of 
our tax cuts go to working families making less than $75,000 per year. 
The truth is, the Republican budget allows Medicare to grow by an 
average of 7 percent per year. Medicare beneficiaries will receive more 
money next year than they do this year, and they will keep on receiving 
more year after year after year.

  It truly shows you just how ingrained the status quo is here in 
Washington, how accustomed the liberals have become to spending 
American's money, when they attack us for wanting to slow the budget's 
rate of growth.
  I remember a few years back, when we were having a serious national 
debate on the proposal by former Senators Rudman and Tsongas--one a 
Republican and one a Democrat--to freeze the Federal budget. Just think 
what the rhetoric would be like if we had proposed a freeze. But we 
have not. Instead, we've proposed limiting Government's growth to $350 
billion over the next 7 years.
  So I say to my friends in the media: You have a duty to report the 
truth to the American people. Report that Medicare will grow, not get 
cut. Report that Republicans are giving working families a tax cut, and 
not a giveaway to the rich.
  Let me close by saluting Senator Domenici for the outstanding job he 
has done throughout this debate. I know how much time and energy he has 
invested over the years in the quest for a balanced budget, and I like 
to think that I know how much this vote means to him.
  Congratulations, as well, to Senator Roth, for his leadership in 
achieving the historic tax cuts contained in this budget, as well as 
the Medicare provisions, which involved a tremendous amount of work.
  Mr. President, it's no secret this vote is not the end of the budget 
process. We have repeatedly said that if President Clinton has 
constructive ideas to offer, we are ready to listen. But, with or 
without the President's help, we're determined to deliver the change 
the American people voted for, determined to move America forward, and 
determined to continue speaking for America's future.
  The PRESIDING OFFICER. Is there any further amendment?
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I ask for third reading.
  The PRESIDING OFFICER. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed for a third reading and was read 
the third time.
  Mr. DOLE addressed the Chair.
  The PRESIDING OFFICER. The majority leader.
  Mr. DOLE. I ask unanimous consent that the Senate now proceed to the 
consideration of H.R. 2491, the House-passed reconciliation bill; that 
all after the enacting clause be stricken and the text of S. 1357, as 
amended, be inserted in lieu thereof. Further, I ask unanimous consent 
that the bill be read for the third time, and the Senate then vote on 
passage of the bill, with the above occurring without any intervening 
action or debate.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. DOLE. Mr. President, let me just indicate to my colleagues there 
will not be a session on Monday. If there is, it will be pro forma 
only. Let me thank my colleagues for their cooperation. This has been a 
very important, very historic vote. There is a lot taking place here on 
this vote. I hope we can have a unanimous vote.
  Mr. DOMENICI. Midnight.
  Mr. DOLE. Midnight.
  The PRESIDING OFFICER. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed for a third reading and was read 
the third time.
  Mr. DOMENICI. I ask for the yeas and nays on final passage.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The bill having been read the third time, the 
question is, Shall it pass? The yeas and nays have been ordered. The 
clerk will call the roll.
  The assistant legislative clerk called the roll.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 52, nays 47, as follows:

                      [Rollcall Vote No. 556 Leg.]

                                YEAS--52

     Abraham
     Ashcroft
     Bennett
     Bond
     Brown
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kyl
     Lott
     Lugar
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Pressler
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--47

     Akaka
     Baucus
     Biden
     Bingaman
     Boxer
     Bradley
     Breaux
     Bryan
     Bumpers
     Byrd
     Cohen
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Feinstein
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Hollings 

[[Page S 16096]]

     Inouye
     Johnston
     Kennedy
     Kerrey
     Kerry
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nunn
     Pell
     Pryor
     Reid
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone
  So, the bill (H.R. 2491), as amended, was passed.
  Mr. EXON. Mr. President, I move to reconsider the vote.
  Mr. DOMENICI. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. LOTT. I ask unanimous consent that S. 1537 be returned to the 
calendar.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. EXON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Nebraska.
  Mr. EXON. Mr. President, I want to take a moment, if I might, to 
thank all Senators on both sides of the aisle, especially my friend and 
colleague, the chairman of the committee, for his consideration all the 
way through this process. We have had a great deal of help from the 
leader, from Senator Dorgan, Senator Kerrey, Senator Ford; the whole 
Democratic leadership has been very helpful and supportive all the way 
through this most difficult process.
  In the end, though, as we always do, and should, I will take time out 
to thank the very dedicated staff. I have been on the Budget Committee 
for the 17 years that I have been in the U.S. Senate. I think we have 
been particularly well blessed with excellent staff on both sides of 
the aisle that work very, very well together.
  So I congratulate the chairman of the committee, whom it is my 
pleasure to work with. We will be working together in the future on a 
whole series of matters.
  I want to end up tonight by taking a moment to thank the Democratic 
staff members of the Budget Committee for the truly outstanding job 
they did during the consideration of the reconciliation bill and 
through all of the procedures that we had in the Budget Committee. I 
would like to extend my appreciation, therefore, on our side to the key 
members of our staff: Amy Abraham, Andy Blocker, Kelly Dimock, Tony 
Dresden, Jodi Grant, Matt Greenwald, Joan Huffer, Bill Dauster, Jim 
Klumpner, Nell Mays, Sue Nelson, John Rosenwasser, and Jerry Slominski.
  Mr. President, these were outstanding people that do an outstanding 
job. I thank them for their dedication, talent, and for all the help 
that they give not only to the ranking Democrat but all Democratic 
members of the committee. I thank them very much.
  If I did, I did not leave out Phil Karsting intentionally. The leader 
of that group, of course, is Phil Karsting, who has been there for 
several years now as the central director of everything that we do on 
the Budget Committee. He has been sitting here advising Members of the 
Democratic side and working closely with many people on the other side 
of the aisle. I have always been particularly impressed with the good 
working relationship that Bill has with the Bill on that side. That is 
what makes things work in the end. I am very proud of all of the staff.
  Mr. DOLE. Mr. President, I just want to thank all Members, as I did 
before. I thank the Democratic leader. We were able to work together. 
We had 58 votes. We were on the bill 42 hours. As the Senator from West 
Virginia pointed out, we had a record number of votes today--39. So we 
exceeded both records that the Senator from West Virginia talked about 
earlier.
  I particularly thank the distinguished Senator from New Mexico, 
Senator Domenici, his staff, my staff, and all the staff on this side. 
Also, a special thanks to the Senator from Alaska, who has been 
presiding much of the day. We appreciate the way he has handled the 
duties of the chair. It has made it much easier for all of us.
  Also, I thank my colleague from Mississippi, Senator Lott, who has 
actively been working on a daily basis to find out how many votes we 
would have on these various amendments, and for all the cooperation we 
have had on this side of the aisle.
  This is a historic vote. We have to go to conference, and it is not 
going to be easy. We need to pass the conference report. There is an 
indication that the President may veto the bill. I hope that is not the 
case. Any way you look at it, this is a historic vote. We watched the 
House yesterday sail through theirs in about 6 or 8 hours. It took us a 
little longer, but the results were the same.
  Mr. President, 52 out of 53 Republicans have voted for this historic 
package, which is going to mean a lot of things to a lot of people, 
whether it is preserving and strengthening Medicare, or reforming 
welfare, or cutting taxes for families with children--not the rich, but 
families with children and, most importantly, balance the budget by 
2002. I do not care where you are, who you are, what your politics are, 
people want to balance the budget. That is precisely the reason we have 
gone through this effort day after day, week after week, in all the 
committees, and that is why all the chairmen and all the others have 
been working so hard.
  Now it becomes a special responsibility for the Budget Committee 
chairman in the conference, working with Republicans and Democrats. We 
are not going to waste any time. We are going to start on Monday. We 
have work being done this weekend by the staff. Monday, I will meet 
with the Speaker, and we will be talking about how we can speed up the 
conference and how we can, if possible, meet the deadline by November 
13 to have a conference report. So we are working on the conference 
already. We have had staff looking into some of the areas in sort of a 
pre-conference effort. I believe we will be able to complete our work.
  Again, I say to the President of the United States: If you want to 
make some arrangement, or negotiate, whatever, I think both the Speaker 
and I have said, again this morning, we are prepared to meet. We think 
it would be a little presumptuous of us to call the President. But if 
he wants to call us, obviously, we are more than willing to sit down 
with the President of the United States to talk about what we are 
doing, what he hopes to do and see if there is any common ground.
  Again, I thank all my colleagues.
  Mr. DOMENICI. Mr. President, might I thank Senator Dole for his kind 
words, and might I say to more people than I can mention how much I 
appreciate their efforts. I say with a bit of pride that the Budget 
Committee is frequently not liked around here. They seem to always be 
telling somebody what to do. Those who serve on the Budget Committee 
know that this all started there. Without that budget resolution and 
this process, we would clearly not be changing the country from the way 
it is being run today, from the way Government is run to the way we 
would like it. I am very proud of it.
  I have been working at it about 22 years, and I never thought we 
would get to this night. We still have some work to do, but there can 
be no doubt that we have proven that using the procedures of the U.S. 
Congress, as onerous and difficult as they are, we can get a balanced 
budget; that we can change programs to meet the goals and objectives of 
our people, and to do that which is best for America.
  It is obvious to everyone that America cannot continue to spend $482 
million a day more than it takes in. The real goal is to pay our bills 
as we accrue those bills, and let the adults take care of the problems 
of our country and not pass them on to our children and grandchildren. 
That is the issue. Do we want strong money and a strong economy, lower 
interest rates and our standard of living going up? Or do we want to 
watch it dwindle away, little by little, as that gigantic deficit will 
do? We have shown that we can change things enough to change the course 
of the economic history of our Nation, I think, for the better.
  Obviously, none of this could be done without some fantastic staff 
people. I do not have a list of all of ours, but I am going to just say 
that without Bill Hoagland at our side, we probably would not be here. 
He comes up with the ideas, and I get credit for it, or Senator Dole 
does, or even Sheila does. Everybody gets ideas from Bill Hoagland, and 
they are right more times than not.
  There are a few Senators to thank. Hard work was done in one 
committee, the Committee on Finance. I am sorry 

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we instructed you to save so many dollars and cut so many taxes. But 
the Finance Committee, led by Bill Roth, did a magnificent job. That 
was obvious here today. A special thanks to Spencer Abraham, a member 
of our committee, who worked hard. I asked him to do a special job for 
me, in a special way, and he did it very well. I thank him so much for 
that.
  With that, let me say one more time, as I have many times in the 
past, thanks to Senator Exon, who I frequently slip and call Governor, 
for the wonderful job that he does in representing his side of the 
aisle in getting this work done.
  He and his staff also are nothing but quality and excellence, and to 
the minority leader who is standing here now, I want to say thank you. 
It was difficult at first to reach some accommodation.
  It was sort of like we were shadowboxing maybe for the first 7 or 8 
hours. In fact, you might have wondered whether we would ever get in 
the ring. That was by design. Yet, you got much of what you wanted by 
way of votes for your people, and we got what we wanted: Final passage 
of a great bill.
  I want to begin by thanking my colleagues. I wish to thank the staff 
and all members of the Budget Committee for their hard work. I would 
also like to thank all of the committee chairmen who worked so 
diligently to meet the terms of the budget resolution and add flesh to 
its bones.
  Also, I would thank the able ranking member, Senator Exon, he is a 
fine friend and an able adversary. The Senate will be a poorer 
institution when he departs next year.
  And, finally, I would like to take a moment to acknowledge the 
constant and determined leadership of the majority leader, Senator 
Dole. We all know, he is a remarkable American. And his commitment to 
keeping his promise to the American people--to give them the first 
balanced Federal budget in 26 years--is the reason we are here tonight. 
As always, he has kept his word and has provided this Nation the 
honest, effective, and steadfast leadership that has defined his tenure 
in this body.
  I speak about Senator Dole's leadership because that's what the vote 
we are about to cast is all about. Leadership. Honest leadership that 
protects America today, and tomorrow.
  Leaders, it's been said, are the custodians of a nation. Of its 
ideals, its values, its hopes and aspirations. Those things which bind 
a nation, and make it more than a mere aggregation of individuals.
  But governing for today is much easier than leading for the future. 
It does not take a great deal of talent or courage to solve the 
immediate need. It's not a lot harder to pave a pathway for the future.
  Yet, we who serve in public office have a responsibility to protect 
the future. We must work on behalf of those who will follow us, our 
children and grandchildren. We are the trustees of their future, of 
their legacy of their opportunities.
  Leadership requires courage. It requires boldness and foresight to 
safeguard a nation's ambitions and confront its challenges.
  President John Kennedy put it this way when he said: ``To those to 
whom much is given, much is required.'' And he reminded us that, as 
public servants, we would be judged, at least in part, by our courage.
  I couldn't agree more.
  Eight months ago my Republican colleagues and I began a courageous 
effort to throttle runaway Federal spending and give the American 
people the first balanced Federal budget in more than a quarter 
century.
  We knew it would be difficult. We knew it would require determination 
and endurance. But we had promised the American people we would balance 
the budget and put an end to the persistent deficit spending that has 
been bleeding our Nation dry.
  A deficit growing by $482 million a day; $335 thousand a minute; and 
$55 hundred every second. Let me repeat that last figure again--our 
deficit is currently growing at $5,500 a second.
  Deficit spending is draining the economic lifeblood of our country.
  It's heaping mountains of debt upon our children and which will drag 
them down. We are irresponsibly shackling our kids with our bills. And, 
left unchanged, they will be the first generation of Americans to 
suffer a lower standard of living and less opportunity than their 
parents.
  Yet, if we pass the budget before us, we can reverse this tide.
  This budget will restore our Nation's fiscal equilibrium and preserve 
America as the ``land of opportunity'' for this and future generations. 
It reflects a commitment to fiscal responsibility, generating economic 
growth, creating family-wage jobs, and protecting the ``American 
Dream'' for all our citizens--young and old alike.
  This is not just rhetoric. A recent DEI study concluded a balanced 
budget would boost America's yearly output by 2.5 percent over the next 
10 years. And it would mean 2.4 million more jobs by 2005.
  Further, a recent GAO study suggests that an average family's income 
will increase as much as $11,200 over the next 30 years. And the CBO 
says interest rates will decline by as much as 1.7 percentage points by 
2002.
  That means less debt for our children and more money in the pockets 
of working Americans today.
  Opponents of this budget have employed every trick, every political 
maneuver, and every scare tactic to halt our march to a balanced budget 
and forging a more efficient and more responsive Federal Government.
  But here are the unvarnished facts:
  Under our budget, Federal spending will continue to grow, We'll spend 
$12 trillion over the next 7 years. That's only $890 billion less than 
we would otherwise spend.
  We balance the budget without touching Social Security.
  This budget shrinks the Federal bureaucracy, eliminating many Federal 
departments, agencies, and programs.
  We move money and power out of Washington and back to citizens in 
their States and communities.
  This budget reforms the welfare system while maintaining a safety net 
for those in true need, especially children.
  And it preserves, improves, and protects Medicare.
  We began this debate by calling for unity in this effort. It was our 
hope that all of us, Republican and Democrat alike, would shoulder our 
basic responsibilities. We asked colleagues on both sides of the aisle 
to work together in the bipartisan spirit the American people are 
looking for.
  We only requested that we move swiftly, while we still have time, to 
confront the debt crisis that threatens to suffocate our nation's 
vitality and snuff out its economic growth.
  But rather than cooperation, we were met with confrontation. That's 
too bad. Because at every turn in this process, this Senator has tried 
to reach out to my Democrat colleagues and to the White House in hopes 
they would work with us.
  Yet, they declined. I believed they did so because they 
underestimated Republicans stamina and the determination of the 
American people on this issue. They didn't think we would do it. They 
thought we would fold.
  Instead, we persevered. We did something rare in this town. We have 
kept out word, stuck to our objectives, and, despite the misleading 
rhetorical flack fired by the guardians of the status quo, kept our 
word.
  So as we prepare to take the final vote on this package I want to say 
to my colleagues you may not agree with every item in this package. 
There may be some portions you would like to change. That may happen.
  But I want to also remind you that it is an honest, straightforward 
balanced budget. No smoke. No mirrors. No rosy scenario. Just balance.
  The President says he'll veto this budget. I wish he wouldn't but I 
think I understand the game the White House is playing.
  He says he has a kinder, gentler budget that somehow magically gets 
to balance while spending nearly $300 billion more in domestic 
programs. He says he can get to balance by spending more and cutting 
less.
  Sound phony? That is because it is. The President's so-called budget 
hides $475 billion in blue smoke and mirrors.
  It's a political document, hastily thrown together last June in 
response to Republican determination and our passage of the budget 
resolution.
  That is why if we don't pass this budget tonight, we will not have a 
balanced budget. Because the reality is 

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that throughout this debate we have had to drag this White House 
kicking and screaming toward a balanced budget.
  The chronology is clear. This White House opposed the balanced budget 
constitutional amendment, its first budget waved the white flag of 
surrender at the deficit, and, as I said, it only offered a fig-leaf 
balanced budget after Republicans passed the real thing.
  I believe there is still hope. I am ready to meet with budget leaders 
at the White House anytime so they might join with us in fashioning a 
budget that gets to balance in 7 years.
  I'm ready to do it now. Tonight. This weekend. Yet the White House 
has it's veto strategy and, apparently, feels we must go through this 
little mating dance before we get down to business.
  But if we don't pass this budget tonight that will never happen. The 
born-again budget balancers at the White House will quickly fall off 
the wagon and deficits will continue.
  So we can not be swayed by veto threats. We must continue to move 
forward.
  Senators, this is a historic vote. I've waited years for this vote. 
It is one more step toward the balanced budget the American people have 
been screaming for. It is a vote for responsibility. It is a vote for 
accountability. And it's a vote to stop this Government from borrowing 
$5,500 a second to buy everything it wants and begin considering what 
it can afford.
  Admiral Halsey told us: ``There aren't great men. There are just 
great challenges that ordinary men like and me are forced by 
circumstances to meet.''
  Tonight this Senate faces a great challenge. Let us--ordinary men and 
women--have the courage to meet that challenge and, in doing so, 
preserve America's promise of opportunity.
  I ask unanimous consent that the bill that we passed be printed. We 
do not have it printed yet.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  [The bill was not available for printing. It will appear in the 
Record of Monday, October 30, 1995.]
  Mr. DASCHLE. Mr. President, let me commend the distinguished Senator 
from Nebraska for the remarkable job that he did in representing our 
side during these very difficult days. He has worked with all of the 
Members of this caucus, as he always does, with professionalism and 
leadership.
  I personally appreciate the contribution that he has made, along with 
his excellent staff. They have done all the work on this bill from our 
side in representing us and they have done an outstanding job. I 
applaud them as well.
  Mr. President, the tragedy underlying the passage of this 
reconciliation bill is that it fails completely to reflect political 
consensus. We all agree on the need to balance the budget, but there 
has been no effort by the Republican majority to address Democrats' 
concerns and the very real concerns of the American people.
  We have stated time and again that we want to work with the majority 
to produce a bipartisan solution to the deficit problem. The President 
of the United States has held out his hand in an offer of cooperation. 
Instead of cooperation, we have been cut out, shut out, and our 
concerns have been ignored.
  Along with us, the American people have been shut out of this 
process, and their values have been trampled upon. As people are 
realizing how they and their families will be affected in a real way, 
they are increasingly rejecting the Republican budget plan.
  The plain fact is that Democrats have a clear and successful track 
record of reducing the deficit. In 1993, we achieved $600 billion in 
deficit reduction without a single Republican vote. The result is that 
the deficit, as a percentage of the economy, is this year at the lowest 
level since 1979.
  The deficit has fallen for 3 years in a row for the first time since 
Harry Truman was President. In fact, the 1993 economic plan is working 
better than even the Administration or the Congressional Budget Office 
had projected. That is because the economy has performed better than 
projected since 1993 due to the success of the President's economic 
plan.
  While we seek to balance the budget, we also understand that there is 
a right way and a wrong way to do it. The budget plan before us is the 
wrong way. Unlike the Republicans in 1993, this year we offered to 
cooperate in good faith so long as our basic concerns were on table.
  We said $270 billion in Medicare cuts to pay for $245 billion in tax 
breaks for the wealthy was unacceptable. And we asked that the 
priorities in this budget be changed to protect children, the elderly, 
those with disabilities, working families, rural America, and the 
environment. This debate is about people: seniors who need Medicare, 
young people who need an education, families who need a fair income--
and greater stability, and rural people who want to preserve their way 
of life.
  That is why we are here. It is what unites us as Democrats. It is why 
we have fought so hard and so long against the harmful provisions of 
this bill.
  None of our concerns was addressed. The majority did not budge one 
inch on any of the extreme proposals they made.
  As a result, this budget is ``DBA''--dead before arrival--and is 
certain to get the veto it so richly deserves.
  This is a ``reconciliation'' bill in name only. Certainly there was 
no reconciliation with Democrats. There were no hearings, no 
consultation with Democrats, and virtually no time for debate.
  Senate Republicans held a private markup in the Finance Committee, 
locking out committee Democrats for the first time in history. The 
congressional majority has exercised rigid party discipline, forcing 
every one of its members to march in lockstep even if they disagree 
with the fundamental direction of their leadership.
  The Senate received its first look at this package only one week ago. 
It was not printed and available to all Senators and the public until 
this Tuesday. The result is a 2000-page abomination we are only now 
beginning to understand.
  This far-reaching, extreme package is being rushed through Congress 
before public opposition can bring it down. The authors of this budget 
have not built a consensus with anyone, except themselves. They claim a 
mandate for their radical course--as if wishing would make it so.
  This budget does not reflect the hopes and needs of most Americans. 
Nor have we reconciled our problems with the deficit.
  Under this budget, in the year 2002, there will still be a deficit of 
over $100 billion, and we will use Social Security money to pay it off. 
Maybe that is why 80 percent of the American people, in a recent poll, 
said they believe this bill will not balance the budget. They know it, 
and we know it.
  The only reconciliation that has taken place has occurred in the 
Speaker's office--in backroom deals between the right and the far 
right--and between the Republican leadership and a line of special 
interests that just keeps getting longer. And longer.
  Mr. President, our country deserves better than this. This is not 
what the American people voted for last year.
  The American people did not vote last year to cut $457 billion in 
health benefits to give tax handouts to those who do not need them. 
They did not vote last year to cut education to millions of students so 
that some of America's largest and wealthiest corporations could pay no 
taxes at all. The American people did not vote last year to raise taxes 
on American families making less than $30,000 so the richest Americans 
could pay $6,000 less. Nor did they vote not to have a farm bill for 
the first time in 80 years.
  They did not vote for this budget plan then, and they do not support 
it now.
  Mr. President, this bill is not a product of the reconciliation 
process. It is an abuse of the reconciliation process.
  What is in this monstrous package? It contains the largest health 
care cuts in American history. Two hundred seventy billion dollars in 
Medicare cuts alone. The mask is off those who have argued that their 
intention is to ``save'' Medicare. Their real purpose is to dismantle 
Medicare.
  Three days ago the Republican leaders of both Houses of Congress made 
clear their real intentions. One stated that creating Medicare was a 
mistake in the first place, and the other said that Medicare as we know 
it will ``wither on the vine.'' Their recent 

[[Page S 16099]]
statements help explain why they insist on cutting $270 billion from 
Medicare, when only $89 billion is needed to restore its solvency for 
the next eleven years. As a first step toward abolishing the program, 
they are cutting Medicare three times more than necessary to pay for 
their ``crown jewel'' offering to the special interests: $245 billion 
in tax breaks.
  Mr. President, this attack on Medicare reveals how far out of touch 
with the American people the proponents of this bill have become. 
Medicare is one of the greatest success stories of our time. The 
American people know that, even if some of their politicians have 
forgotten.
  In 1965, before the creation of Medicare, 46 percent of seniors had 
health care coverage. Today, 99 percent are covered. Does the majority 
want to bring us back to the ``good old days'' when only half of our 
senior citizens had health insurance? It would be heartless to go back 
to the age when our older citizens suffered needlessly from disease and 
even premature death because they had no access to health care.
  The consequences of these Medicare cuts will be severe. Hospitals 
will be forced to close. Couples will be forced to pay an average of 
$2,800 more for health care by 2002. Clearly, Medicare is being used as 
a piggy bank to fund tax cuts for the wealthiest Americans, with no 
regard to the damage to the health care of senior citizens in America.
  This bill dismantles Medicaid. At a time when we have unacceptably 
high numbers of Americans with no health care coverage, it would 
deprive an additional 36 million Americans guaranteed health care 
coverage under Medicaid.
  A recent study by the Consumers Union and the National Health Law 
Program estimates that 12 million Americans--half of them children--
would lose their health care coverage under this proposal. Surely the 
majority doesn't think the American people voted last year to increase 
the number of uninsured.
  Older Americans and their families also have reason to fear the 
destruction of Medicaid. One-half of the nursing home patients in the 
U.S., including over 1 million senior citizens, rely on Medicaid. What 
will happen to the quality of their care under this bill? What 
justifies putting the spouses and adult children of nursing home 
residents at risk of bankruptcy?
  That is not what the American people voted for last year either.
  The majority is telling these people and their families, ``You're on 
your own.''
  Republicans say, ``Don't worry about those details. Think about the 
tax relief in this bill.'' But there is no tax relief in this bill for 
average Americans. There are only new tax burdens for them.
  Despite the Republican promises, the typical family in this country 
earning less than $30,000 will see their taxes increase under this 
bill. And half of all families in the U.S. have incomes below $30,000.
  This bill represents the biggest transfer of income from the lower 
and middle income levels to the wealthy that we have ever seen. In one 
fell swoop, it destroys 30 years of investment in our people.
  Most of the pain in the budget--affecting seniors, children, working 
families, rural America, and the environment--is driven by the 
insatiable greed on the part of the congressional majority for tax 
breaks that benefit the wealthiest Americans and large corporations. 
The richest one percent of Americans--those earning over $350,000--will 
get an average tax break of $5,626.
  Many large corporations will pay no taxes at all under this bill.
  Not only do these generous handouts to the wealthy require huge cuts 
in education and health care and so many other areas, they are fiscally 
irresponsible. The tax breaks will add $293 billion to the debt over 
the next seven years--$293 billion in added debt that our children will 
have to pay off! The costs of those tax breaks will explode after the 7 
years covered in this budget. To those who profess that this effort is 
intended to save our children from the crushing burden of our debts, I 
would ask them to explain this hypocrisy.
  For all the talk we have heard about how this plan is intended to 
benefit children and future generations, the actual provisions of the 
bill reveal a different story.
  The bill launches an assault on education in this country. By cutting 
billions for student loans, this bill closes the door on a college 
education for many Americans.
  Other children's priorities are savaged as well. By 2002, up to 6.5 
million children could lose health coverage. Food stamps will be cut. 
Foster care payments will be capped, threatening to throw us back to 
dependence on the orphanages the Speaker proposes. Countless children 
threatened with abuse may never benefit from investigations of their 
situations. This bill plays a shell game with the $3 billion in child 
care funds that were included in the Senate welfare reform bill. It 
cuts Title XX, the states' primary source of child care money, by $3.3 
billion. It is ``Home Alone II'' for children whose families are trying 
to work their way off welfare.
  Another giant item stuffed into this package is the 1995 farm bill, 
which drops a bomb on rural America. For the first time in history, the 
farm bill was included in the reconciliation package. There were no 
hearings on the Republican plan.
  The bill cuts farm programs by 25 percent. Net farm income will 
decline under this measure by $9 billion. This devastating blow comes 
on top of the other hits on rural America in the bill --ravaging rural 
health care and closing hospitals, tax increases on working families, 
elimination of rural educational opportunities.
  Taken as a whole, this package amounts to a raid on rural America 
that will devastate our rural way of life--perhaps forevermore.
  Have we learned nothing from our recent history?
  This bill asks us to take another riverboat gamble, like the one 
Ronald Reagan took when he called for huge tax breaks for the wealthy 
in 1981. We all lost that gamble when deficits soared in the 1980s as a 
result. In fact, if it were not for the cost of interest payments on 
the debt built up under Presidents Reagan and Bush, the budget would be 
balanced today.
  No wonder the American people fear another roll of the dice. 
According to a recent poll, the public rejects the tax break proposals 
in this budget by a margin of nearly 3 to 1. The American people have 
learned a costly lesson from Reagan's riverboat gamble. Eighty-one 
percent said they believed that even if the Republican plan is enacted, 
the budget will not be balanced by 2002.
  We are saying no to another riverboat gamble, and we will do so with 
one voice. Unlike 1981, every Senate Democrat will oppose this budget.
  This budget is fundamentally flawed. It does not strengthen America. 
It weakens America. It does not bring us together, it moves us apart. 
The ``haves'' will have more, and the rest will have less.
  Worst of all, this budget does not reflect the priorities of the 
American people. The American people reject the idea of cutting taxes 
before the budget is balanced. They disapprove of the Republican 
Medicare plan. As the American people are learning whose side this 
budget is on, they are demanding we change it.
  Senate Democrats offered a series of amendments to correct these 
gross inequities in this bill, both in committee and on the Senate 
floor. Virtually every one was defeated on a party-line vote. As a 
result, the destructive, dangerous excesses contained in this bill will 
not receive a single vote from our side of the aisle. This bill 
deserves a veto by the President of the United States--and vetoed it 
will be.
  This budget is mean and extreme. It rewards the rich and ravages the 
rest. It punishes families who need our help most to pay for tax breaks 
for those who need handouts the least.
  It is the wrong plan, for the wrong reason, done the wrong way, to 
help the wrong people.
  Mr. LOTT. Mr. President, much of what the minority leader just had to 
say has been said over and over again. It, I think, has been answered 
sufficiently, but it is very hard to sit here and listen to that speech 
after all that we have been through for the last three days.

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