[Congressional Record Volume 142, Number 10 (Thursday, January 25, 1996)]
[House]
[Pages H873-H876]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
BALANCING THE BUDGET
The SPEAKER pro tempore (Mr. Hefley). Under the Speaker's announced
policy of May 12, 1995, the gentleman from Connecticut [Mr. Shays] is
recognized for 20 minutes as the designee of the majority leader.
Mr. SHAYS. Mr. Speaker, I appreciate the opportunity to address the
House.
Mr. Speaker, former Prime Minister Rabin made it very clear that he
felt that politicians, elected officials, were elected by adults to
represent the children, and that is in fact what our responsibility
ultimately is, to represent the children and to leave this country a
better place than we found it.
When I was elected in the statehouse in 1974, really at the end of
the Vietnam War, our national debt was $430 billion. In the 22 years
since the end of the Vietnam war, our national debt has grown to $4.9
trillion. We have seen a tenfold increase since the last really
extensive war. So we fought the Revolutionary War, we fought the war
with the pirates, we fought the War of 1812, we fought the Civil War,
we fought the Spanish-American War, we fought World War I, we fought
World War II, we fought the Korean war, we fought the Vietnam war, and
our national debt was about $430 billion.
Admittedly those dollars bought more in past years, but since then
our national debt has grown to $4.9 trillion.
I was elected to the statehouse, and I looked at Congress with some
awe, that it is an amazing place. It is a magnificent opportunity to
serve in Congress. But I looked as a State legislator and said I have
to balance our State budget in Connecticut. I cannot let it be
unbalanced.
I understand when times are bad you might have a year or two when you
[[Page H874]]
want to generate economic activity and get out of a recession, but you
would not just have this systematic deficit spending that has added
tenfold to our national debt.
When I was elected in 1987, I vowed that the most important thing
would be to save our country from bankruptcy. Not to ``balance the
budget,'' but, no, to save it from bankruptcy, to not mortgage this
country so that our children would not have a country.
I became part of an effort that the gentleman from Ohio [John Kasich]
started in 1989, at least that is the first time I remember voting for
one of his major deficit reduction bills, and there were 38 of us that
voted for it. Each year that number kept increasing.
We have three main objections as this Republican majority: We want to
get our financial house in order and balance our Federal budget; we
want to save our trust funds from bankruptcy, particularly Medicare
from insolvency, as it is going now to bankruptcy in the year 2002, 7
years from now, now 6 years from now; and, third, we want to transform
this caretaking social and corporate welfare state into a caring
opportunity society.
Now, on the first area, getting our financial house in order, as a
Member of Congress, I vote on one-third of the budget. I do not vote on
entitlements, unless we make a proactive effort to change. What comes
out of the Committee on Appropriations is one third of the budget. When
I was in the statehouse, it was basically 100 percent of the budget,
except for the debt issue. So we vote only one-third of the budget.
Gramm-Rudman focused on one-third of the budget. You control the
budget by appropriations, but it was only one-third. Then entitlements
kept growing so that they are now half of our budget.
What we are looking to do, this is the first Congress, and Wednesday
are doing something that Leon Panetta, the Chief of Staff, the former
head of the OMB, but then the former chairman of the Committee on the
Budget said we have to do, that we will only get a handle on our budget
and get our financial house in order if we look to control the growth
of entitlements.
So I take tremendous pride in being part of an effort with my
colleagues on this side of the aisle, who have been willing to take on
every special interest to represent the children to get our financial
house in order so that we do not have such large debt. And this debt is
consuming 42 percent of all of our savings.
Now, what does that mean? It means that when people save money for
new plant and equipment, to have it be invested in this country, 42
percent of it gets taken away to fund our national debt. So what are we
doing? We are cutting some discretionary programs. We are doing that.
We are downsizing Government. We are looking to have the Commerce
Department not be a department anymore, to downsize and reduce the
number of departments and become more efficient and not have 11 layers
of decision makers within our departments; but to reduce that, like we
have in the private sector.
But when I hear the word ``cut,'' it applies to some things and not
others. We are not cutting the earned income tax credit. We are not
cutting the school lunch program. We are not cutting the student loan
program. We are not cutting Medicare and Medicaid. Maybe we should in
some instances be cutting some programs. We are not. We are allowing
them to grow. They are going to grow and grow and grow, but we are
trying to slow their growth.
The bottom line to this is what the earned income tax credit is is a
payment that the Federal Government makes to the working poor. We are
going to continue that, but it is not going to go to married couples
without children, it is not going to go to single people. And we
ultimately are going to cap it so it does not go to people making
incomes of $35,000 or more. We are going to allow the earned income tax
credit to grow from $19 to $25 billion.
{time} 1500
The School Lunch Program is to grow from $5.2 to $6.8 billion. The
Student Loan Program is to grow from $24 to $36 billion; that one
really gets me. We are getting student loans. They are growing by 50
percent. Only in this place and in this city, when you cut the growth
and allow it to continue to grow by 50 percent, do people say you are
spending less.
Mr. HAYWORTH. Would the gentleman yield?
Mr. SHAYS. Yes, I will yield briefly.
Mr. HAYWORTH. I am so glad to see my friend from Connecticut here,
because once again he returns to the key point in this debate. We are
trying to realize budgetary savings, not by eviscerating programs but
by reducing the rate of growth.
I cannot help but note with great interest when our friend who
visited two nights ago, the gentleman who lives in the big White House
at the other end of Pennsylvania Avenue, talks about budgetary savings,
he is talking about the same type of exercise, yet he remains
unchallenged on that by our friends on this side. Yet that curious
mathematical exercise, where increases are called cuts, runs rampant in
this institution; and I salute my good friend from Connecticut for once
again bringing it to our attention.
I would like to inquire of my friends from Connecticut, because this
is something that intrigued me: In the latest budget our President has
offered us, he himself talked about the days of big Government being
over; but as I understand it, his plan calls for some $200 billion in
higher taxes and some $350 billion in additional spending over and
above the real savings that you have labored so hard for to try and
right-size this Government. That, to me, is especially confounding, and
I am wondering why the reports of, dare I say it, budgetary neglect or
overspending are not really chronicled in the White House budget offer.
It is very curious what transpires inside this beltway with the
representations of certain budgetary exercises.
Mr. SHAYS. The gentleman has asked a very important question, and I
would like to get into that issue; but what I first want to do is be
very clear about what we are doing, because I am not all that clear
about what the President is doing.
I am clear about what he is saying in terms of his message, and I
want to compliment the President on a few issues. And the gentleman is
welcome to stay, but I want to go through a few key points; and I might
have time at the end that we would have this type of analysis of the
President's presentation.
We are not cutting the earned income tax credit; it is growing. The
Student Loan Program is growing. The student lunches are growing.
Student loans are growing by 50 percent. Every student is going to get
the same amount of loans under our plan as they would get under the
President's plan.
There is a difference. We are saying, with the students in that
period of when they graduate to when they get a job, and we allow a 6-
month, what they call grace period, interest free, we are going to have
that interest paid by that student, but we are going to allow that
interest to be amortized during the entire repayment of the loan. It
amounts to $9 more a month. It is a movie theater and popcorn. It is a
pizza. It is something that we are asking students to do. They will
still have all the loans, but it is $9 more a month, and that is
because we do not want the taxpayer to pay that.
We are saving, admittedly, $4 billion in the next 7 years, the
taxpayers are. Medicaid is growing from $89 to $127 billion. Medicare
is growing from $178 to $289 billion.
Medicare is the one that really gets me. Medicare is growing at 7.2
percent more a year, and we did it by not increasing copayments and not
increasing the deduction or increasing the cost of the premium to the
beneficiary. We leave it at 31.5 percent. The taxpayers will pay 68.5
percent. We left it at 31.5 percent. Under existing law, it would have
dropped to 25 percent.
Why would we ask the taxpayers to pay even more? We want to be at
31.5 percent. As health care costs go up, 31.5 percent is going to be
slightly higher, but the taxpayers are going to pay slightly higher at
68.5 percent, because they pay the balance of it.
The bottom line is, we are looking to get our financial house in
order and balance our Federal budget, and we are doing it by cutting
some programs in discretionary spending and slowing the growth of
entitlements, which are 50 percent of the budget. They are on automatic
pilot, and we are looking to change that, and we are doing it for our
children.
[[Page H875]]
Now, when we get to Medicare, in particular, we know it is starting
to go insolvent. What does that mean? This year, more money is going
out of the Medicare Part A fund that pays for our hospitals than is
coming in; and in the seventh year, all of it is out of the fund; there
is no money left. Then the only way we pay for Medicare Part A is, the
money goes into the fund and it immediately disappears and it will not
be enough to pay for all the costs of Medicare Part A.
So we are looking to restore $132 billion of funds to put into that
system, to slow the takeout and to provide the funds to be in that
system until the year 2010. And when I think about this, I am thinking
about Medicare, it is growing at 7.2 percent a year. Per beneficiary,
it is $4,800 to $7,100. And I am going to say it again: Only in this
place, when you spend so much more, do people call it a cut. It is a
49-percent increase to beneficiaries.
Let me go through one last part. When we get to this third part, we
want to get our financial house in order. We want to save our trust
funds, particularly Medicare, from bankruptcy. Transforming this
caretaking, social and corporate welfare state into an opportunity
society is a very big part of what we are about. Instead of giving
people the food, we want them to learn how to grow the food. Instead of
giving them the food, we are giving them the seed to grow the food. We
are looking to make people responsible.
This gets me to the President's presentation. The President gave a
speech that Ronald Reagan, for the most part, would have been proud to
give, and I would be. He talked about personal responsibility. He
talked about downsizing Government, making it smaller. He talked about
what we have been fighting for during this last year. And I want to be
respectful of the President, because he was respectful of us and he is
our President.
To his credit, he said that this Republican Congress is trying to do
some heavy lifting and get our financial house in order. He
acknowledged that, and in the end, he acknowledged what we have done
with congressional accountability and the gift ban and lobby
disclosure. He said it happened under this Congress, and I consider
that a positive and honest statement.
I also believe in a lot of what he said about cherishing our children
and our family, and dealing with crime and dealing with education
issues, and the need, in fact he scolded Congress on the environment,
and I happen to agree with his scolding of Congress on that one issue.
The pendulum is too far this way, and unfortunately, I think too many
of us on our side of the aisle want to go too far the other way. We may
have an honest disagreement on that, but that is democracy.
But the bottom line is, I wrestle with this, 12-year-olds having
babies. I wrestle with 14-year-olds selling drugs. I wrestle with 15-
year-olds killing each other and 18-year-olds who cannot read their
diplomas. I wrestle with 24-year-olds who do not have a job, not
because jobs do not exist, but because those McDonald's jobs are dead-
end jobs.
My dad, bless his heart, would have said to me, Son, how many hours
are you working there? I would have said, 10. He would have said, Son,
it just increased to 12 or 15. No job is a dead end, because it teaches
you to come to work on time and to get up in the morning and to be of
service. And it teaches you that you get something in return.
And so I just make this point, that if we succeed in balancing the
budget, if we succeed in saving our trust funds, but we do not
transform this social and corporate welfare state into an opportunity
society, we have ultimately failed. And I say that as a moderate.
I say, as someone who recognizes that some of what Government has
done, and some of what I have voted to have Government do, has failed.
Could I ask the Speaker how much time we have left. I want to make
sure I am thoughtful of my colleague who has joined me.
The SPEAKER pro tempore (Mr. Hefley). The gentleman has 5 minutes
left.
Mr. SHAYS. Mr. Speaker, sometimes a liberal is the person who sees
someone drowning out 50 feet from the pier and runs to the end of the
pier and grabs 100 feet of rope and throws this excess rope. The rope
is dangling around the person, and finally it is taut and ready to be
pulled in, and that liberal takes the rope, drops it, and says, I have
done my good deed and on to the next.
I have criticism of conservatives if they take this position: They
see someone drowning 50 feet out and they take 25 feet of rope and say,
Here, I will throw 25 feet of rope. You swim halfway, and I will meet
you and pull you in.
They may need 50 feet of rope, but they may need something more, and
I believe this side of the aisle has not taken that view. It has taken
the view that we need not only give people the seed, but show them how
to grow the food. But we do not necessarily give them the food
indefinitely.
Mr. Speaker, I am happy to yield to the gentleman from Arizona [Mr.
Hayworth].
Mr. HAYWORTH. Mr. Speaker, I think my friend offers an interesting
analogy, and what I have often said, despite some of the labels and
names that have been bandied about this Chamber, what difference does
it make if an idea is called conservative or liberal or whatever, if it
makes sense? The notion being this: that if we are able truly to
empower the individual, if we are able to make sure that society has a
safety net instead of a hammock, then that should be our goal.
Mr. Speaker, I thank my friend from Connecticut for his diligence in
looking at budgetary issues and acknowledging, while sometimes we may
not see completely eye to eye on every item that comes down the pike,
certainly there is a broad consensus within this new majority to
address the problems.
But even as we had our friend from the other end of Pennsylvania
Avenue join us the other night and say that the days of big government
were over, I was intrigued by the statement that followed that. On one
occasion he said, ``But we cannot fend for ourselves,'' or words to
that effect. And I believe that we have to be very careful of that type
of blanket statement, for what it does is contradict the previous
statement.
For it is not the role of government to step into every home, to step
into every situation; to say, Washington calling, and we are here to
provide you certain safeguards, or we are here to step in and intervene
in every avenue of your life. Of course not.
The notion is this: that for society's poorest, that for society's
sickest, that for society's weakest, government can exist to help make
sure that rights are enforced, that individual liberties are not taken
away; but we must remain ever vigilant that the same government who
works to empower us with those rights does not in the process take away
a person's well-being, both mentally and financially.
Mr. SHAYS. Mr. Speaker, reclaiming my time, as the gentleman points
out, there is a tremendous balance in that whole effort. The bottom
line is, the President talked about personal responsibility, and that
is where it is at.
I would like to close by making this point. I know there are a number
of Members of Congress who are not running again. Some of them happen
to be moderate Members. And the news media said they are not running
again because this is no longer a fun place or that this is no longer a
nice place. And I just want to take a little bit of a different view of
that issue.
Mr. Speaker, my view is, very frankly, this is not a fun place
anymore. Why would it be a fun place? Because we are doing heavy
lifting. There is nothing fun about having to confront the elderly and
the young and every other special interest group and say, We are going
to have to do some things differently to save this country from
bankruptcy. It is not a fun place.
But what bothers me is that some of the people who are leaving were
here as this country went down into a deep hole of debt, and now that
we are in this deep hole of debt and we have to get out of this deep
hole of debt, at least stop the deficits, they are quitting. So I
contend that they may be quitting, not because this is not a fun place
anymore because people are not nice, but because we have to do heavy
lifting.
The bottom line, Mr. Speaker, we are doing heavy lifting. This is an
epic battle. We are not going to necessarily agree with our colleagues
on the other side. We should continue this battle and fight it out.
[[Page H876]]
PRESIDENT'S BUDGET MEETS THE TEST
The SPEAKER pro tempore. Under a previous order of the House, the
gentleman from California [Mr. Miller] is recognized for 5 minutes.
Mr. MILLER of California. Mr. Speaker, we have heard since the
election of November last, and all of last year, that the goal of the
Republicans in Congress was a 7-year, CBO-scored, balanced budget. And
the challenge over the last several months apparently was to get the
President of the United States to agree to put on the table a 7-year,
CBO-scored, balanced budget.
The President of the United States has done that. He has met that
test. CBO has scored that budget. There is some $700 billion in savings
in that proposal sufficient to balance the budget in these 7 years; and
yet we now find that rather than take those savings and balance the
budget, the Republican majority would rather end the negotiations. So
those negotiations have been ended when there is $700 billion in cash
sitting on the table that all they have to do is walk in and pick it up
and walk out, and the American taxpayers get all the benefits that we
have all talked about from balancing the budget.
{time} 1515
Rather than do that, apparently now there is an idea afoot that what
we will have is a downpayment, a downpayment on the deficit. I have
been here 20 years, and I have only seen one downpayment on the deficit
that lowered the deficit. That is what President Clinton did 2 years
ago when the deficit was over $250 billion, and today it is $167
billion. All the other downpayments on the deficit never quite got
around to lowering the deficit.
So right as we are on the eve of a balanced budget, we find ourselves
in the unusual position of the people who claim to have been the
strongest proponents of that balanced budget, and I do not think there
is any question that they have done everything to move this Congress
toward a balanced budget, they now walk away from the negotiations
because it is not everything that they could have had.
Rarely in negotiations, whether it is in business or sports, in your
family or in the Congress, do you get your sway on everything. And so
we are talking about $700 billion in savings sitting on the table,
waiting for somebody to pick it up. It is $297 billion in discretionary
cuts, $124 billion changes in Medicare, $73 billion in interest
savings, $67 billion in other mandatory spending changes, $59 billion
changes in Medicaid, corporate subsidies and compliance, $56 billion
and $41 billion in welfare changes. This is a lot of money, my
colleagues. This is the largest deficit reduction that we have seen.
But now we are going to turn it down because it is not perfect? Because
it is not exactly apparently what the majority wanted?
We can still make these changes in Medicare. We can have a separate
vote on this floor. We can have a separate vote on this floor on
medical savings accounts, make them part of it, either in or out. But
we do not have to hold up the changes necessary to get the largest
entitlement program in the country under some control.
We can make changes and we can still discuss whether Medicaid is
going to have nursing home standards or it is not going to have nursing
home standards, whether it is going to be an en bloc entitlement or a
personal entitlement. We can have those debates afterwards. We can
spend this whole year debating that subject. But we can get the
budgetary savings, we can get the deficit reduction now while it is
real. That is when it is important.
We know that essentially, that essentially we would dramatically
change, under the coalition welfare bill that was passed, that was
voted on in this Congress, I believe every member of the Democratic
Party voted for, dramatically restructures welfare as we know it in
this country, dramatically restructures your ability to stay on welfare
forever without meeting your responsibilities to try to find a job and
to go to work, substantially changes your obligations if you are going
to receive taxpayer dollars. The requirements of going to work, the
requirements of time limits on welfare, all of that can be achieved and
$41 billion in savings at the same time. But we are going to turn it
down because it is not exactly what the Republicans wanted in their
bill.
This is incredible. This is incredible that we would be here on this
eve, and now we are going to back up and we are going to create some
kind of stopgap budget reduction legislation with a tax cut, and we are
going to sort of give some kind of partial savings.
I just find that when we see that the President of the United States
has come this far and is this willing to make these kinds of
concessions and these kinds of changes, changes that are needed in each
and every one of these programs, that somehow the Republican majority
in this Congress will not give the American people those savings, those
savings that will bring the budget to balance, those savings, as one of
the previous speakers in the well said, will provide for reductions in
interest rates on home mortgages, on credit cards, on student loans,
and all of the things that America borrows for, that will provide real
money in the pockets of working families in this country, is now going
to be turned down by the Republican majority.
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