[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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