Congressional Record, Volume 142 Issue 11 (Friday, January 26, 1996)

[Congressional Record Volume 142, Number 11 (Friday, January 26, 1996)]
[Senate]
[Pages S418-S429]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

THE BALANCED BUDGET DOWNPAYMENT ACT, I

The Senate continued with the consideration of the bill.
Mr. MOYNIHAN addressed the Chair.
The PRESIDING OFFICER. The Senator from New York.

Amendment No. 3120

(Purpose: To increase the public debt limit)

Mr. MOYNIHAN. Mr. President, I send an amendment to the desk and ask
for its immediate consideration.
The PRESIDING OFFICER. The clerk will report.

[[Page S419]]

The legislative clerk read as follows:

The Senator from New York [Mr. Moynihan] proposes an
amendment numbered 3120.
At the end of the bill, add the following:

TITLE V--PUBLIC DEBT LIMIT

SEC. 501. INCREASE IN PUBLIC DEBT LIMIT.

Subsection (b) of section 3101 of title 31, United States
Code, is amended by striking the dollar amount contained in
the first sentence and inserting ``$5,400,000,000,000''.

Mr. MOYNIHAN. Mr. President, I will remark, if I might, on the
brevity of this measure, the succinctness of its purpose, which is to
increase the debt ceiling of the United States from the present $4.9
trillion to $5.4--one should not use decimal points when referring to
trillions--$5.4 trillion. This $500 billion increase will provide
sufficient borrowing authority for the Federal Government until about
the end of May 1997.
Mr. President, I offer this amendment on the circumstance of the 11th
time since 1984 that the Federal Government has been in a ``debt
issuance suspension period,'' commonly known as a debt ceiling crisis.
The repeated past crises of the debt ceiling, and the present
unprecedented, protracted crisis that has been upon us since the debt
ceiling was reached over 2 months ago, has left the Secretary of the
Treasury, the distinguished Secretary Robert Rubin, with little
recourse under law by which he could allow the Government to continue.
But he has now stated that there are three remaining ones, with the
very specific sums associated with each, and that in no circumstances
can the Government meet its financial obligations after the 29th of
February or the 1st of March.
What we face, Mr. President, is the prospect of default. Moody's
Investors Service has placed on review for possible downgrading--those
are the terms--some $387 billion of obligations of the U.S. Treasury
for interest payments falling due between February 29 and April 1, the
first time in our history that the credit of the United States has been
potentially brought into question by an investment advisory service.
How to scale this event? We are not going to have many people
participate in this debate and not many people will be on the floor as
we proceed. I wonder if there is not some apprehension about this issue
that leads to a kind of avoidance.
How would you scale this prospect of default, Mr. President? I give
you the typical prospect. It would be the equivalent of losing a war.
We are not talking about a program. We are not talking about
appropriations. We are talking about the United States of America.
The War of 1812 was perhaps the closest we ever came to losing a war.
In 1814 the British seized Washington. They burned the White House.
They burned the Treasury building. They burned the Capitol. But the
service of the debt of the U.S. Government went forward undisturbed out
of subtreasuries elsewhere, prominently New York and Philadelphia.
We were a debtor then, a debtor nation, rapidly paying off our debt.
We would have none whatever by 1837. We had acquired that debt in the
course of the Revolutionary War. State governments incurred this debt,
and Alexander Hamilton insisted that the Federal Government assume that
debt. Paying it off established the credit of the United States in
Europe and in a mode that allowed us to be a great importer of capital
through the 19th century as we built our industries and infrastructure.
Today we are not only a debtor once again but we are the world's
largest debtor, the result, Mr. President, not of the War for
Independence, but of the working out of the long-term strategy that
took shape in the late 1970's designed to refashion the American
National Government by dismantling its finances.
Mr. President, I spoke upon that subject on any number of times in
the 1970's. In July 7, 1980, I wrote a long article for the New York
Times describing it. And I said of that strategy which came to be known
as starve the beast:

The Republicans' dominant idea, at least for the moment,
seems to be that the social controls of modern Government
have become tyrannical or at the very least exorbitantly
expensive. This impression, so the strategic analysis goes,
is made possible by taxation such that cutting taxes becomes
an objective in its own right, business cycles
notwithstanding.

And 3\1/2\ years later, with the new administration in place and a
budget deficit now steadily rising, I wrote of this same subject. Might
I just add, Mr. President, that on January 20, 1981, the debt was about
$900 billion. In the intervening 15 years we have added $4 trillion.
I spoke again of this basic proposition, not easily understood, not
widely even noted. The proposition is that the deficits were
purposeful, that is to say, that the deficits in the President's
initial budgets were purposeful. They were expected to disappear. They
have not disappeared.
The then-Director of the Office of Management and Budget, Mr. David
Stockman, said there are $200 billion deficits as far as the eye can
see. And in that mode, the debt was beginning to accumulate.
I put it up to the whole legislative budgetary agenda at that time. I
quote--this is in the New Republic of December 31, 1983. I said:

There was a hidden agenda. It came out--hidden in plain
view like pearls of a purloined necklace.
It came out in a television speech sixteen days after
President Reagan's inauguration, when he stated, ``There were
always those who told us that taxes couldn't be cut until
spending was reduced. Well, you know we can lecture our
children about extravagance until we run out of voice and
breath. Or we can cut their extravagance by simply reducing
their allowance.''

That was the pattern, starve the beast. It would be pointless to try
to argue out of existence this program, that program, another
appropriation. Simply make it impossible to go forward because there
are no funds, and indeed we looked the unthinkable prospect of default
in the very face.
I wrote then that there was an alternative, that the possibility of a
historical compromise was present.
Democrats might come to understand the sense of the opposing party
that Government, indeed, had become too big, too interventionist, at
times, indeed, an obstacle to the private lives and private fortunes of
the citizenry. There is that edge, the regulatory state.
Republicans would have to understand that they could not put it in
service of the political strategy, they could not put the integrity of
the United States of America at risk and that compromise may finally
have been reached. It has been agreed that we will balance the budget
in 7 years. This will involve reducing a great many programs. It will
involve preserving others.
I stand here, Mr. President, to say to the Republican Members across
the aisle, ``Your strategy has worked.'' The President, in the State of
the Union message 2 days ago, declared: ``The era of big Government is
over.'' He said it not just once, he said it twice.
The debt service did it, not quite as anticipated but effectively so.
The strategy has worked. I might give you a specific, and I will not be
long. In 1994-1997, the period we are in, spending on Government
programs is less than taxes for the first time since the 1960's. If you
go back 30 years to the Kennedy-Johnson era, you will find a time when
we were spending less than we collected in revenues, and at that time,
a great source of concern arose for economists: the phenomenon of
fiscal drag. Congress was not spending as much money as it brought in.
That changed so dramatically. The deficits of the 1980's, as far as
the eye can see, continued until, in 1993, under President Clinton, we
passed legislation that reduced spending and increased revenues by half
a trillion dollars. After that, the deficit premium, as it is called,
on interest rates declined. The anticipation that we would deal with
the deficit reduced interest payments, and outlays were reduced by
another $100 billion.
So right now, revenues are running ahead of outlays, save for the
debt service. The debt service has done its work. Debt has done its
work, and now it seems to me, it appears to me, that we have an
understanding of the reality. However little either side might like it,
it is there.
Can we not go forward now to agree to extend the debt ceiling in the
context of an agreement to bring about a balanced budget, not to put
the United States at risk in a world in which we are the largest
debtor, and our debt is held by central banks and elsewhere all around
the world? To bring it into

[[Page S420]]
question is to bring the fundamentals of the American Government into
question as well.
I urge the Senate, I urge my friends on the other side of the aisle
to declare victory and preserve the authority and integrity of the
United States Government because, Mr. President, nothing less is at
issue.
Mr. President, I ask unanimous consent that the two articles I
mentioned be printed in the Record.
There being no objection, the articles were ordered to be
printed in the Record, as follows:

[From the New Republic, Dec. 31, 1983]

The Biggest Spender of Them All--Reagan's Bankrupt Budget

(By Daniel Patrick Moynihan)

In his first thousand days in office Ronald Reagan
increased the national debt of the United States by half. If
he should serve a second term, and the debt continues to
mount as currently forecast by the Congressional Budget
Office, the Reagan Administration will have nearly tripled
the national debt. In eight years, one Republican
Administration will have done twice, you might say, what it
took 192 years and thirty-eight Federalist, Democratic, Whig,
and Republican predecessors to do once. The numbers are so
large they defy any ordinary effort at comprehension (a
billion minutes ago St. Peter was fourteen years dead), but
for the record they are as follows. On President Reagan's
inauguration day, January 20, 1981, the national debt stood
at $940.5 billion. In the next thirty-two months, $457
billion was added. The projected eight-year growth is $1.64
trillion, bringing us to a total debt, by 1989, of $2.58
trillion.
Debt service, which is to say interest on the debt, will
rise accordingly. It came to $75 billion in fiscal year 1980.
By the end of this fiscal year, it will be something like
$148.5 billion. And so it might also be said that the Reagan
Administration will have doubled the cost of the debt in four
years.
A law of opposites frequently influences the American
Presidency. Once in office, Presidents are seen to do things
least expected of them, often things they had explicitly
promised not to do. Previous commitments or perceived
inclinations act as a kind of insurance that protects against
any great loss if a President behaves contrary to
expectation. He is given the benefit of the doubt. He can't
have wanted to do this or that; he must have had to do it.
President Eisenhower made peace, President Kennedy went to
war; President Nixon went to China.
Something of this indulgence is now being granted President
Reagan. Consider the extraordinary deficits, $200 billion a
year, and continuing, in David Stockman's phrase, as far as
the eye can see. This accumulation of a serious debt--the
kind that leads the International Monetary Fund to take over
a third world country's economic affairs (or in olden times
would lead us to send in the Marines to collect customs
duties)--is all happening without any great public protest,
or apparent political cost.
As such, this need be no great cause for concern. If Ronald
Reagan is lucky, good for him. There is little enough luck in
the business. But, unfortunately, something much larger is at
issue. If nothing is done, the debt and the deficit will
virtually paralyze American national government for the rest
of the decade. The first thing to be done, to use that old
Marxist terminology, is to demystify the Reagan deficit.
If I may say so, what I now write, I know. That is not and
should not be enough for the reader. I will ask to be judged,
then, by whether the proposition to be presented is coherent,
and whether any other proposition makes more sense.
The proposition is that the deficits were purposeful, that
is to say, the deficits for the President's initial budgets.
They were thereafter expected to disappear. That they have
not, and will not, is the result of a massive
misunderstanding of American government. This is not
understood in either party. Democrats feel uneasy with the
subject, one on which we have been attacked since the New
Deal. Republicans are simply uncomprehending, or, as Senator
John Danforth of Missouri said in a speech on the debt
ceiling in November (referring to the whole Senate, but
permit me an inference), ``catatonic.''
Start with the campaign. Although we may be forgiven if we
remember otherwise, as a candidate, Mr. Reagan did not
propose to reduce federal spending. Waste, yes, that would be
eliminated, but name a program, at least one of any
significance, that was to go. To the contrary, defense
spending was to be considerably increased. That was the one
program issue of his campaign. It was the peculiar genius of
that campaign that it proposed to increase defense
expenditures while cutting taxes. This was the Kemp-Roth
proposal, based on Arthur Laffer's celebrated curve. As a
candidate, Mr. Reagan went so far as to assert that this
particular tax cut would actually increase revenues.
What follows is crucial: no one believed this. Obviously a
tax can be so high that it discourages the taxed activity and
reduces revenue. This is called price elasticity and is a
principle that applies to pretty much everything from the
price of The New Republic to the price Justice Holmes said we
pay for civilization. But any massive reduction in something
as fundamental as the income tax was going to bring about a
massive loss of revenue. And this was intended.
There was a hidden agenda. It came out in a television
speech sixteen days after President Reagan's inauguration,
when he stated, ``There were always those who told us that
taxes couldn't be cut until spending was reduced. Well, you
know we can lecture our children about extravagance until we
run out of voice and breath. Or we can cut their extravagance
by simply reducing their allowance.'' The President genuinely
wanted to reduce the size of the federal government. He
genuinely thought it was riddled with ``waste, fraud, and
abuse,'' with things that needn't or shouldn't be done. He
was astute enough to know there are constituencies for such
activities, and he thought it pointless to try to argue them
out of existence one by one. He would instead create a fiscal
crisis in which, willy-nilly, they would be driven out of
existence.
If his understanding of the government had been right, his
strategy for reducing its size would have been sound. But his
understanding was desperately flawed. There is waste in the
federal budget, but it is of the kind generic to large and
long-established enterprises. Thus we have an Army, a Navy,
and an Air Force. They compete, they overlap, they duplicate.
Well, yes. But they also fight, in no small measure because
these uniforms mean something to those men and women, and
have, in the case of the Army and Navy (and of course the
Marine Corps, which is part of the Navy) for more than two
centuries. A management consultant might merge them. I sure
as hell wouldn't, except perhaps way at the top. For the
rest, well, there is the F.B.I. at $1 billion; the Coast
Guard (equally long established) at $2.5 billion, and so on.
Welfare? In the sense of welfare mothers? The Aid to Families
with Dependent Children program comes in at about 1 percent
of the whole budget. (The Washington Post has half-seriously
proposed that it be abolished altogether so that people will
stop talking about it.) There are areas in the budget where
expenditure is indeed growing at enormous rates, principally
that of medical care. But for the most part, and especially
in the case of medical care, expenditure is growing at
similar rates in both the private and public sectors. Large
social forces are at work, not simply a peculiarly
pathological tendency of government.
A notable area of miscalculation, or rather misinformation,
among the Reaganites was that of foreign affairs. President
Reagan has acted much as his predecessors have done in
foreign affairs, and for the elemental reason that he is
faced with much the same situations. Invariably, this has
meant spending money. This fall the President had to plead
with Congress to increase appropriations for the
International Monetary Fund, something he cannot have
expected ever to be doing, but there you are. As I write, the
Kissinger Commission on Central America is no doubt drawing
up a massive ``Marshall Plan'' for the area. Is there any
doubt that in the next session the President will be pleading
with Congress to increase this particular form of foreign
aid? (Just as, had his supporters in the Senate been
successful in blocking the Panama Canal treaties in the
Carter years, he would be pleading today with the Senate to
consent to their ratification.)
President Reagan's tax cut--the largest tax reduction in
history--became law in August 1981. Critics, if they are
members of Congress, typically must begin by explaining why
they voted for the tax cut. I am one. (There were only eleven
Senators who voted no.) I have an explanation, but no excuse.
After years of intense inflation and the accompanying
``bracket creep'' in the income tax, we did need to reduce
personal tax rates. A year earlier, the Senate Finance
Committee, controlled by the Democratic majority, had
reported out just such a bill, but Mr. Carter's White House
would not hear of it. This helped lose the Senate for the
democrats, but the lesson was not lost.
The great recession of 1981-82 made it painfully clear that
the tax cut was too small for the first year, when a neo-
Keynesian stimulus was in order. At the time, however, a
bidding war broke out in the House, sending the parties into
senseless competition to offer loopholes to special
interests. The result was a tax cut much too large for the
later years. Thus the $200 billion annual deficit. Again, no
excuses from this quarter, but in the Democratic response to
the President's televised speech of July 27, 1981, I did say,
``In the last few days something like an auction of the
Treasury has been going on . . . what this is doing is taking
a tax cut we could afford and transforming it into a great
barbecue that we can't afford. I would say to the President
that some victories come too dear.
Enter the Federal Reserve Board which looked at the huge
tax cuts in the midst of high inflation and decided to create
an economic downturn. Of all the structural anomalies of
American government, the arrangements for setting
macroeconomic policy are the most perverse. Although fiscal
policy (the amounts of money the government spends, receives,
and borrows) is made through a painfully elaborate public
process by an elected President and an elected Congress,
monetary policy (the total amount of money in the economy and
the cost of borrowing it) is made in secret by appointed
officials. The Reserve Board tightened the growth of the
money supply so strenuously that it actually declined in the
third quarter of 1981. Real interest rates reached the
highest levels in our nation's history, and the economy fell
off the cliff. At the end of September 1981, the steel
industry was operating

[[Page S421]]
at 74.5 percent of capacity; by the end of 1982, it was operating at
29.8 percent of capacity.
To be sure, the Fed does not control the precise money
supply and cannot precisely determine interest rates. But it
can set the direction and range for both and this it did.
Anyone who tried to dissent was soundly rapped. Its two dozen
or so central bankers decided to bust the economy, and bust
it they did. In a White House appearance in October 1982,
Nobel Economist George Stigler used the term ``depression''
to describe the economy.
There is a tendency for any government to live beyond its
income. The Reagan Administration transformed this temptation
from a vice into an opportunity. Put plainly, under Ronald
Reagan, big government became a bargain. For seventy-five
cents worth of taxes, you got one dollar's worth of
return. Washington came to resemble a giant discount
house. If no tax would balance the budget, and no outlay
would make it any worse, why try?
A boom psychology moved through government. Defense came
first, from space wars to battleships--the latest defense
appropriations reactivates the World War II-vintage U.S.S.
Missouri. Hog wild is the only way to describe the farm
program. Jimmy Carter left behind a $4 billion enterprise,
somewhat overpriced at that and the object of incessant
right-wing criticism. Whereupon the fundamentalists and their
political brethren took over. Within thirty-six months they
increased the annual cost of the farm program more than
fourfold. Their most recent enthusiasm, signed into law by
President Reagan, is a program paying dairy farmers not to
milk their cows.
What is to be done? The economy is at stake. The country
can bankrupt itself. According to the latest budget
projections, prepared by the Congressional Budget Office
under the impeccably conservative new director, Rudolph G.
Penner (formerly of the American Enterprise Institute), the
deficit for the six years 1984 to 1989 will come to
approximately $1,339,000,000,000. In order to support and
service this debt, the government will have to absorb more
and more of the capital that is coming available in the
nation's credit markets. Direct federal borrowing for the
deficit and federally guaranteed loans absorbed 62 percent of
all credit raised on the nation's financial markets this
year, compared to an average absorption rate of 8.3 percent
in the 1960s and 15.3 percent in the 1970s. This ``crowding
out'' was not much felt, because few others were borrowing to
invest. But when the day comes that business, consumers, and
government all compete for the same funds, interest rates
will go up, with predictable consequences.
Under these circumstances, the only thing a Republican
Administration and a Republican Senate will be able to
consider doing will be to revert to their original agenda:
use the budget deficit to force massive reductions in social
programs. This time they will be able to cite not mere
illusions but necessity. Even if interest on the debt climbs
to $200 billion a year, as now seems likely, presumably there
will still be an Army, an F.B.I., and some kind of customs
service and border control. What then will be left to cut?
Entitlements, or more precisely, Social Security.
The word is already the rage. There is scarcely a
Republican member of the Senate who does not know that
entitlements must be cut, and cut deeply. Many Democrats
agree; almost none dissent. Remember, at least twenty
Senators are millionaires, living at considerable social
distance from those who would be most affected. It will be
much the same in the House. The budget deficit in the year
ahead will threaten any sustained recovery. The members of
the House, as a rule, are not millionaires, but they know
their street corners. The street corners will say, ``Cut.
Something must be done.''
Cut back Social Security in desperation, and you abandon a
solemn promise of the Democratic Party and of American
society. This promise, once broken, will fracture a little
bit of society. (Moreover, cutting Social Security will not
improve the deficit problem. As Martin Feldstein, chairman of
the Council of Economic Advisers, has noted, Social Security
is funded by separate payroll taxes and contributes not a
cent to the deficit.)
There is an alternative. There is the possibility of a
historic compromise that can bring the now dominant branch of
the Republican Party to grips with reality, while shaking the
now dominant branch of the Democratic Party from its illusion
that no one will listen to Republicans for very long. Such a
compromise cannot await a change in the political culture. It
must be negotiated. We need a structure, a forum in which
negotiations can take place. A Presidential commission might
be such a structure.
The National Commission on Social Security Reform--on which
I served--would provide a model. It was established by
President Reagan in December 1981, after Congress rejected
his original plan to sharply reduce Social Security benefits.
One point in particular is crucial. Alan Greenspan, who
chaired the commission, adopted a simple rule: each member
was entitled to his own opinion but not his own facts. Within
a year Mr. Greenspan had established the facts, which showed
that the problem was neither trivial nor hopeless. The
commission as such could reach no agreement. But with the
facts established, we put together a bipartisan legislative
package last January in exactly twelve days.
The budget crisis presents a harder problem, but it can be
approached in the same way. Martin Feldstein made a good
beginning in a speech to the Southern Economic Association on
November 21. He agreed with the Congressional Budget Office
that by 1988 the deficit will absorb 5.1 percent of the
nation's G.N.P. Of this, Feldstein noted, 2.4 percent will
come from increased defense spending, 1.7 percent from the
tax cut, and the remaining 1 percent from higher interest
payments. The facts about the structural deficit flow readily
from such quantification.
The members of the budget commission--representatives from
the Administration, Congress, the Federal Reserve, and the
Congressional Budget Office--would determine the actual
effects of deficits on employment, real interest rates,
capital formation, investment, and the prospects for vigorous
economic growth. Then they would propose the steps to reduce
the deficit, making certain that the burden of these
reductions did not fall disproportionately on any economic or
social group. Delaying tax indexing, reforming corporate tax
law deductions and credits, cutting defense spending, and
reducing farm price supports, among other proposals, would
have to be considered. Medicare, secure in the short term,
will be in deep trouble before the end of this decade. The
deficit commission must face up to this problem. Democrats
should agree to do so in return for assurances that the
Social Security agreement will be respected and that the
Social Security trust fund will not be raided (the plain
purpose of those who say entitlements are the problem).
Moreover, a solution to the deficit crisis will require
more than adjustments in spending and taxation. It will
demand change in the way we make fiscal and monetary policy
and the way those policies are coordinated. Monetary policy
and the operations of the Federal Reserve must be an integral
part of any fiscal resolution. Nothing can be achieved
without a joint monetary-fiscal effort to promote an
expanding economy and an approach to full employment--a one
percentage point drop in unemployment alone reduces the
budget deficit by $30 billion.
But let's stop here. I have my own thoughts. The reader
will have his or hers. On the final day of the last session
of Congress, I introduced legislation to establish the
National Commission on Deficit Reduction. Now, can we get the
President to join?
____

[From the New York Times, July 7, 1980]

Of ``Sons'' and Their ``Grandsons''

(By Daniel Patrick Moynihan)

Once upon a time, before the Coming of the New Deal, there
was a group of Republican Senators who were not sound men on
subjects such as the High Tariff. Their names were well
enough known--Johnson of California, Norris of Nebraska, La
Follette of Wisconsin, Shipstead of Minnesota--but you might
say their families were not. They were definitely Western,
arguably Populists, and assuredly Not Quite in the Best of
Taste.
In a speech on the Senate floor in 1924, an Eastern
Republican, drawing on Jeremiah 14:6, referred to them as
``sons of the wild jackass.'' The phrase was much in vogue in
the brief period remaining to that era, after which
Republicans generally lapsed into an undifferentiated and
glum opposition.
Soon the wild jackasses were no more. But of a sudden their
grandsons have appeared. In the Senate surely, and in their
party generally, and the reaction has been much the same,
except that this time it has come from--Democrats!
Take this business of cutting taxes. The Secretary of the
Treasury was not amused. The White House received
unimpeachable intelligence from the Best Sources that it was
a Bad Idea. Dissenting Democratic Senators were informed that
the Chief Executive Officer of the largest corporation in
Delaware had reported that industry was not at all impressed
by the Republican proposal, whilst the head of the Federal
Reserve branch in New York City reported that The Street was
definitely not in favor.
Psychologists call this role reversal. As a Democrat, I
call it terrifying. And to miss it is to miss what could be
the onset of the transformation of American politics.
Not by chance, but by dint of sustained and often complex
argument there is a movement to turn Republicans into
Populists, a party of the People arrayed against a Democratic
Party of the State.
This is the clue to the across-the-board Republican tax-cut
proposal now being offered more or less daily in the Senate
by Dole of Kansas, Armstrong of Colorado and their
increasingly confident cohorts.
It happens that just now they are ``right.'' The economy is
in a steep recession, facing a huge tax increase (windfall
profits and Social Security payments, combined with the
``bracket creep'') next year. Certainly a $30 billion cut in
1981 taxes is in order, and ought to be agreed on quickly,
with luck using the opportunity to get better depreciation
schedules for industrial investment.
But these same Republicans were calling for tax cuts in
1978 and 1979 when clearly they were ``wrong--by, that is,
established standards of fiscal policy. The point is that
these are no longer men of that Establishment.
The process of change has been unremarkable enough. After a
half century of more or less unavailing opposition
(Republicans have controlled the Congress only four years
since 1930) it was possible to agree that new ideas were
necessary.

[[Page S422]]

Observe Bill Brock, chairman of the Republican National
Committee, announcing the appearance, in 1978, of A
Republican Journal of Thought and Opinion: Commonsense:
``We must not forget that the last great partisan coalition
of American politics was built on ideas. These were no less
forceful and appealing, if also debatable, for all their
identification with a political party. The notion of an
activist federal government, with an obligation to use its
centralized power to meet new social problems with new social
controls, was a new idea in the 1930s. But it took hold,
built a durable coalition, became the foundation for decades
of programmatic public policy, and tended to capture the
terms of the political debate.
``As an idea, it had consequences. Only lately have these
come to be generally understood as having mixed implications
for the nation and for individuals in it. Accordingly, the
Republican Party finds itself in opposition, at this writing,
not only to a majority party that controls the machineries of
government, but to the force of certain such idea. It is our
continuing obligation, therefore--to articulate our own.''
This journal has been faithful to its promise: The material
is first-rate. (We Democrats have nothing approaching it.) Of
a sudden, the G.O.P. gas become a party of ideas.
The Republicans' dominant idea, at lest for the moment,
seems to be that the social controls of modern government
have become tyrannical or, at the very least, exorbitantly
expensive. This oppression--so the strategic analysis goes--
is made possible by taxation, such that cutting taxes becomes
an objective in its own right, business cycles
notwithstanding.
Similarly, ``supply-side'' economics speaks to the people
as producers, as against the Government as consumer. Within
the Republican Party this is put forth as populism and argued
for as such. To be wild jackasses, to be Teddy Roosevelts,
and to trust the people. Asked by a commentator whether an
across-the-board tax could really lead to the needed increase
in savings, a Republican Senator replied that he took for
granted that the people would know what to do with their own
money.
There is much G.K. Chesterton in this--indeed, Brock cites
how in another passage to his introduction of Commonsense--
who raged against the elitism of Tory and Socialist alike.
Beer and Liberty, as it has been put, verus Soap and
Socialism. And property for all versus the goods for all, if
such goods came only from giant businesses.
And then there is also much of the Frontier in this New
Republicanism. Some get plenty; and some get none. But it is
surely also a challenge. For we Democrats have been in power
so long we have not been able to avoid becoming in ways the
Party of the Government, and it shows. The party, to be
specific, of those classes and professions and enterprises,
public and private, that depend on Government subvention and
guarantee. With the public sector at a third of gross
national product, (and the Federal share tending toward one
quarter), this is no small constituency. But it is not yet a
majority. And we would do well to take heed when Republicans
start campaigning, as indeed they have, on platforms that
they are the ``party of the working man.'' Do us both good.

Mr. MOYNIHAN. I see my distinguished chairman of the Committee on
Finance is on the floor, and I look forward to his agreement and
collaboration.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER (Mr. Thomas). The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. ROTH. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from Delaware is recognized.
Mr. ROTH. Mr. President, I rise to urge my colleagues to vote against
this amendment to raise the debt ceiling on this occasion. Without a
doubt, the debt ceiling will eventually be raised as it needs to be and
as it should be in order to avoid default.
The problem with addressing the debt ceiling issue at this point is
that there is some urgency in our need to enact the continuing
resolution. To keep Government from shutting down, this resolution must
be enacted today and it must be clean.
This CR has already been negotiated with the House, the Senate, and
the White House. The President has said that he will sign this bill
tonight. This is critically important to maintain uninterrupted
Government services for the American people.
To open the CR now for amendment is to create an obstacle that will
most certainly keep this bill from passing and result in a Government
shutdown. We must reach closure today.
We will address the debt ceiling. Secretary Rubin has asked us to do
so before March 1. That's over a month away. Consequently, there is no
urgency to extend the debt limit now--not if it means once again
shutting down the Government.
The Finance Committee is currently in discussions with Treasury
regarding various aspects of this issue. And we will move forward with
the debt ceiling issue when the moment serves. But not now.
The amendment violates the Constitution. Revenue bills must arise in
the House, and that includes legislation affecting the debt ceiling. If
we adopt this amendment, the House will blue slip the legislation, and
we will be further behind than if we pass this CR and address the debt
at a more appropriate time.
It is customary for Congress to consider debt ceiling legislation
together with provisions to reduce the deficit. The House is in the
process of fashioning such a package. The Speaker has talked with the
President.
Leon Panetta has indicated the administration is willing to work on
such a package. This amendment derails that effort. It is clear, then,
that this amendment, even if it were legal, would not be well received
in the House. Rather than achieve gridlock once again with the Moynihan
amendment, we need to send this continuing resolution to the President.
Mr. President, again, I urge my colleagues to vote against the
amendment to raise the debt ceiling on this occasion.
Mr. MOYNIHAN. Mr. President, may I say to my friend, the
distinguished chairman--and I understand his reasons full well, and
they are wholly appropriate--what separates this moment from others in
the past is that the full faith and credit of the United States is even
now being questioned in international markets. That has never happened.
It has not happened since 1792 when Hamilton worked out the assumption
of the State debt.
I think the fact that the President and the Republican leaders in the
House and here in the Senate have come to an understanding that there
will be a balanced budget agreed to--and the distinguished chairman of
the Budget Committee was there--that should be enough for us to say
that will happen. And, incidentally, do not for a moment ever think
that the United States would default on their debt. That is all we seek
in the spirit of good will.
I point out that the budget agreement, already tentatively marked up,
cuts domestic discretionary spending of the Federal Government by one-
third in 7 years. David Stockman, in his moment of the utmost optimism,
could never have conceived that such an amount of drastic reduction
would not only be agreed to but hardly remarked upon. The era of big
Government is, in fact, over. But the era of default, bankrupt
Government, surely must not commence.
Mr. President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. DOMENICI. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DOMENICI. Mr. President, the Senate can be assured that I want to
expedite the vote on this issue as much as anyone else. So I will be
very brief. There are some people in the country that are concerned
about the full faith and credit that has been such an advantageous
thing for our Treasury bills and the financing of our debt. Our
Treasury bills have been almost the greatest currency in the world.
They are the money market in many parts of the world. Certainly, it
does not behoove the Senate or the U.S. House, Democrat or Republican,
to do anything to tarnish that.
But I believe today the issue before us is: Shall we open the
Government, pay our workers, and get on with the ordinary daily
activities of the Government and, at the same time, assure the
marketplace and those who are concerned that there is no intention on
the part of those on this side of the aisle that are in a position
during the next 4 or 5 weeks to get that debt limit extended, and that
there is no intention on our part that we let the Treasury bills of the
United States go into default?

[[Page S423]]

I stand before the Senate because some of those people that are
influenced by our actions are, from time to time, interested in my
opinion and my views. Frankly, I am saying tonight that I think we
ought not cause the Government of the United States to be closed down
even for 24 hours while we add an amendment that is not necessary
tonight.

We are saying as strongly as we can--I have been with our leader;
there is no intention to do anything other than to work with the
President to extend the debt limit. I cannot say here to Senator
Moynihan that it will be absolutely a clean debt limit, but I can say
there is an intention to extend it in a way that would be signed by the
President.
I remind everyone it would be almost historic if in this kind of a
situation you had a clean bill. There would be some things worked out
between the White House and the Congress. It is always a vehicle that
sends some things to the White House that get done that everyone wants
done. I do not believe we ought to leave the notion out there in
America that if this proposal of Senator Moynihan is tabled, and I hope
it is tabled, that there is any intention to do anything but have a
debt limit extension in an orderly and timely manner.
Mr. WARNER. Mr. President, I thank the distinguished Senator from New
Mexico and the distinguished Senator, the chairman of the Finance
Committee, because I have risen in both our caucuses here recently and
expressed my grave concern about this issue of the full faith and
credit of the United States, how that could be combatted by the actions
with relation to the debt limit.
I, like the distinguished Senator, the chairman of the committee
here, feel very strongly, as does the Senator from Delaware and the
Senator from New Mexico, that we cannot shut down the Government
tonight.
I ask unanimous consent that two editorials on this subject be
printed in the Record.
There being no objection, the editorials were ordered to be printed
in the Record, as follows:

[From the Plain Dealer, Jan. 24, 1996]

Hitting the Debt Ceiling

It is all well and good for House Republicans to fight hard
for their budget priorities. But using the good faith and
credit of the United States government as a weapon in that
fight is short-sighted and dangerous. It is also likely to
backfire.
Until very recently, at least a few top House Republicans
seemed to understand this. Both House Speaker Newt Gingrich
and Budget Committee Chairman John Kasich had signaled a
willingness to pass legislation that would allow the
government--which will soon reach its credit limit--to borrow
more money to avoid default. But on Sunday, House Majority
Leader Dick Armey took a different tack.
Speaking on NBC's ``Meet the Press,'' Armey said Congress
would not increase the debt ceiling unless conditions were
attached. The conditions, he said, would have to advance the
GOP agenda of ``decreasing the size and the intrusiveness of
government.''
The next day, Gingrich adjusted his tune to harmonize more
closely with Armey's. To get a debt-ceiling bill from
Congress, Gingrich said, President Bill Clinton will have to
propose ``substantial reforms'' in future spending.
However much dissent there may still be in Republican
ranks, clearly some party leaders are again embracing the
notion that the goal of forcing an ideologically palatable
budget deal warrants dramatics of the highest order. That is
troubling.
Though deficit-reduction and long-term entitlements reform
are supremely worthy ends for Republicans to pursue, they do
not justify any means. Forcing the U.S. government to default
on its obligations is irresponsible. It is bad policy and bad
politics.
The price of a default--which could include a dive in the
stock market, a leap in interest rates, and a worldwide
ripple of doubt about the reliability of U.S. securities--is
simply too high. If the goal of the most ardent GOP budget
cutters is to promote America's long-term economic well-
being, they defeat their purpose if they ruin America's
credit rating along the way.
It is not hard to understand why some House Republicans
would be feeling acutely frustrated these days. Not only has
budget-making become mired in an extended state of
indecision, but numerous policy initiatives have become
stuck. . . .
____

[From the Chicago Tribune, Jan. 24, 1996]

The Madness of Courting Default

For months, Treasury Secretary Robert Rubin has used every
loophole and opening he could find to extend the government's
borrowing powers and keep Republican lawmakers from using the
debt ceiling to muscle budget concessions out of President
Clinton.
But now, Rubin says, he has run out of options that are
legal and acceptable to Clinton. Unless Congress raises the
debt ceiling, he warns, the nation will for the first time in
its history default on its debts--probably by March 1.
Don't worry, some cynics say. Rubin has more tricks up his
sleeve and will do anything to avoid default.
Start worrying, say others. The Treasury is at the end of
its line, and House Speaker, Newt Gingrich won't raise the
debt ceiling unless Clinton agrees to some GOP-proposed
reforms on entitlements or welfare. The president insists he
won't be blackmailed.
Wherever the truth lies, it's time to stop this reckless
gamesmanship. It's one thing to reach an impasse over how to
balance the budget and agree to take the issue to the voters,
which both Democrats and Republicans seem content to do. But
it's totally irresponsible to jeopardize the credit of the
United States.
Congress' primary concern in the weeks ahead must be to
protect the reputation of the nation as a rock of financial
stability and as a debtor that always has honored its
obligations. Despite their frustration at being stymied on
budget reforms, Gingrich and the Republican hard-liners must
pass an extension of the debt ceiling, without extraneous
conditions.
So far, the financial markets haven't been roiled by the
budget gridlock in Washington. And no one can be sure what
default, or even the imminent threat of it, could mean to the
economy and markets. But it couldn't mean anything good.
Felix Rohatyn, the respected investment banker who is being
considered by the Clinton administration for vice chairman of
the Federal Reserve Board, wrote recently that it ``could
create a catastrophe.'' Politically, the rest of the world
would think America's institutions had collapsed and the
country was no longer governable. Financially, because more
than $500 billion of the nearly $5 trillion in U.S. debt is
held overseas, a default could ``trigger a global financial
crisis of completely unpredictable proportions.''

Mr. WARNER. As I understand, both Senators are giving the assurance
to the Senate that we will, in an orderly manner, work this thing out
in a manner that will not have an adverse impact upon the financial
markets of our Nation. I believe the Senator is giving that assurance.
Mr. ROTH. I say to the distinguished Senator from Virginia, that is
exactly what we are doing. We are acting in a responsible way today; we
are taking action that will ensure that the Government can continue to
function, which I know is of primary interest to our distinguished
Senator from Virginia. That is the reason we do not want it to be
amended further. That would only delay the process and bring about the
shutdown that I think no one wants.
As a second step, we are working already, together with the House,
with the administration. I was in contact yesterday with the Secretary
of the Treasury. We are proceeding to do something about the debt
ceiling because I, like Senator Warner, want full faith from the
President. So we are working to provide the type of legislation that
meets everybody's requirements and can be enacted by the Congress.

Mr. WARNER. I thank the distinguished Senator from Delaware.
Yesterday we had a discussion about this in our caucus, and he
responded in a way similar to that of today.
Mr. MOYNIHAN. Before yielding to the distinguished Senator from Rhode
Island, may I welcome the statements by the chairman of the Committee
on Finance and the chairman of the Committee on the Budget. I take them
wholly with integrity and give them the full faith and credit of the
U.S. Senate.
I have to point out that we have not always had as good an experience
on the House side. A Member on the House side, the counterpart to the
distinguished chairman of the Budget Committee, once openly said,
``Let's do this,'' and then disappeared. We cannot put the United
States, the integrity of the United States of America, at risk this way
with complete understanding of the Senator from Virginia's concern that
the Federal Government stay open. I still hope we might have a vote on
this. I do not want to prolong matters.
The Senator from Rhode Island has risen. I yield 3 minutes.
Mr. PELL. Mr. President, I wanted to rise in full support of the
amendment by the distinguished Senator from New York. If ever there was
a valid reason for stalling an increase in the debt limit, I believe it
has evaporated. The basic agreement has been achieved on

[[Page S424]]
the objective of controlling the deficits that contribute to the debt.
While policy disagreements still persist on some issues, including
Medicare, there appears to be sufficient agreement on other budget
issues to provide $700 billion in long-term savings. Surely, there has
been more than adequate demonstration of good faith.
The apprehensions of Moody's Investor Service with respect to the
credit rating of the U.S. Federal securities should dispel any glib
assurances that the Secretary of the Treasury can still perform acts of
fiscal wizardry to stay under the present limit.
We can only wonder what the motive might be of those who would delay
further. There is no good purpose economically or fiscally.
I want to commend the Senator from New York for raising this matter
and bringing the amendment to the floor. The full faith and credit of
the United States should not be clouded for another single day, and the
Senator from New York is acting responsibly. I yield the floor.
Mrs. BOXER. Mr. President, I rise today to voice my support for the
amendment offered by Senator Moynihan to attach a clean debt limit
extension to the continuing resolution. Congress must not play politics
with the full faith and credit of the United States. We must extend the
debt limit within the next 5 weeks or the consequences will be
catastrophic.
If we fail to raise the debt limit by March 1, the United States will
default on its financial obligations for the first time in the history
of our Republic. As a result, bondholders will not receive the payments
they are due. Social security recipients and veterans may not receive
their monthly benefits, and long-term interest rates will increase
across the board.
Interest rate increases mean that the United States will waste
billions of dollars on increased debt service costs, ironically, making
it even more difficult to balance the budget. But perhaps most
important, higher interest rates mean that the millions of Americans
with any kind of loan--mortgages, car loans, even credit card
balances--can expect higher monthly payments for years to come.
I would urge my colleagues to heed the words of former Treasury
Secretary James A. Baker, who stated in 1985, ``It would be an absolute
disgrace if the United States defaulted for the first time in its over-
200-year history. Any default will have swift and severe implications
both domestically and internationally.''
On November 9, 1995, six former Secretaries of the Treasury, who
served in Democratic and Republican Presidential administrations,
wrote, ``We urge that prompt action be taken either to raise the debt
limit permanently * * * or that a sufficient short-term increase be
enacted to allow the debate over priorities to proceed in an orderly
manner without impairing market confidence in our Nation's commitment
to discharge its obligations''.
Alan Greenspan, Chairman of the Federal Reserve, has written, ``a
failure to make timely payment of interest and principal on our
obligations for the first time would put a cloud over our securities
that would not dissipate for many years''.
Furthermore, former Chairman of the Federal Reserve Paul Volker wrote
that ``The appropriate approach, short of early agreement on a
comprehensive budget program * * * [is] raising the debt ceiling so
that authorized expenditures--including payment of interest on Treasury
debt--can be made in a timely fashion.''
In addition to these current and former leaders of the Treasury
Department and the Federal Reserve, leading credit agencies have warned
of the dire consequences of default. Standard & Poors has warned,
``Even a short-lived default on the U.S. Government's direct debt
obligations would profoundly impact a broad range of securities and
financial market participants.''
Again, Mr. President, I thank the Senator from New York for offering
this very important amendment.
Mr. DOLE. Mr. President, let me reinforce the statement made by the
chairman of the Finance Committee, Senator Roth. I have been meeting
with Republican Senators throughout the afternoon. We are, I think the
Senator from New York would appreciate, acting in good faith. We
believe we can resolve this.
Having been chairman of the Finance Committee and having to deal with
debt ceilings, I know there is always a problem. When there is a
Republican in the White House, the problem is on that side of the
aisle; when there is a Democrat in the White House, the problem is on
this side of the aisle, the problem as far as the administration is
concerned.
I remember going to conference with amendments on Nicaragua. I think
there were 19 amendments--foreign policy, everything you could think of
was on the debt ceiling. I assure the Democratic leader on the floor
and the former chairman of the Finance Committee, as I did Secretary
Rubin the night of the State of the Union Message, we believe we can
get this done in a timely fashion so no checks will be late, nothing
will be interrupted in any way.
Having said that, as one who did not favor the shutting down of the
Government in the first place, I do not think we ought to risk doing it
on a Friday afternoon. If this amendment should be accepted, it has to
go back to the House. The House is in recess. I assume they could come
back Sunday or whenever.
I really believe we have an agreement here that has been approved by
the White House and by the leadership in both parties, in both the
House and the Senate. I hope we will not make it more difficult by--I
know that is not the intent of the Senator from New York, do not
misunderstand me, but I think it would make it more difficult. I know
that is not the Senator's intent. I respectfully move to table the
amendment, and I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
table.
The yeas and nays have been ordered.
The clerk will call the roll.
The legislative clerk called the roll.
Mr. LOTT. I announce that the Senator from Utah [Mr. Bennett], the
Senator from Colorado [Mr. Campbell], the Senator from Indiana [Mr.
Coats], the Senator from North Carolina [Mr. Faircloth], the Senator
from Texas [Mr. Gramm], the Senator from Arizona [Mr. Kyl], and the
Senator from Alabama [Mr. Shelby] are necessarily absent.
I further announce that, if present and voting, the Senator from
Colorado [Mr. Campbell] would vote ``yea.''
Mr. FORD. I announce that the Senator from South Carolina [Mr.
Hollings] is necessarily absent.
The PRESIDING OFFICER (Mr. Nickles). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 46, nays 45, as follows:

[Rollcall Vote No. 2 Leg.]

YEAS--46

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

NAYS--45

Akaka
Baucus
Biden
Bingaman
Boxer
Bradley
Breaux
Bryan
Bumpers
Byrd
Conrad
Daschle
Dodd
Dorgan
Exon
Feingold
Feinstein
Ford
Glenn
Graham
Heflin
Inouye
Johnston
Kennedy
Kerrey
Kerry
Kohl
Lautenberg
Leahy
Levin
Lieberman
Mikulski
Moseley-Braun
Moynihan
Murray
Nunn
Pell
Pryor
Reid
Robb
Rockefeller
Sarbanes
Simon
Specter
Wellstone

NOT VOTING--8

Bennett
Campbell
Coats
Faircloth
Gramm
Hollings
Kyl
Shelby
So the motion to lay on the table the amendment (No. 3120) was agreed
to.
Mr. DOLE. Mr. President, I move to reconsider the vote by which the
motion to lay on the table was agreed to.
Mr. MOYNIHAN. I move to lay that motion on the table.

[[Page S425]]

The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from New York.
Mr. MOYNIHAN. Mr. President, I would like to thank all of those who
have participated in the debate. I would like particularly to thank the
chairmen of the Committee on Finance and the Committee on the Budget
for the undertakings that they have made, and to say again that I hold
them in full faith and credit of the United States. I think we can work
this out, and clearly we intend to do so. It can be done.
Mr. LEAHY. Mr. President, I assume one of the votes that we will have
today will be the continuing resolution. The fiscal year 1996 Foreign
Operations conference report has been attached in its entirety to this
continuing resolution. That means that foreign aid programs will be
funded through the fiscal year at the levels agreed to by the House and
Senate conferees.
The conference report represents a devastating assault on many
foreign operations programs that are vital United States interests
abroad. For that the House Republican leadership bears primary
responsibility. But our alternative, a year long continuing resolution,
would be far worse. It would cause irreparable harm to these programs
and many of the Federal employees who implement them would have to be
laid off. For that reason it is essential that this conference report
be enacted into law.
The conference report funds a wide range of activities that are
strongly supported by both Democrats and Republicans. Although I
believe the funding provided for many programs falls far short of what
is required to effectively combat global threats to the American
people--whether it is environmental pollution, the spread of infectious
disease, unchecked population growth, political and economic
instability caused by enormous numbers of people living in abject
poverty, the growing problem of international crime and terrorism, and
the proliferation of nuclear and conventional weapons, it is better
than no funds at all.
On a more positive note, it also contains a provision of special
importance to me, which was passed by two-thirds of the Senate,
Republicans and Democrats, to impose a moratorium on the use of
antipersonnel landmines.
Since the NATO operation began in Bosnia just a little over a month
ago, over 20 NATO soldiers have been injured or killed by landmines,
including 1 American. That is in addition to the 225 UNPROFOR landmine
casualties in Bosnia, and the thousands of civilian landmine victims,
since the war began 4 years ago. Of the estimated 100 million
unexploded landmines in the world, 6 million are in the former
Yugoslavia. Landmines are killing and maiming an average of one person
every 22 minutes, every day of the year.
My amendment aims to put the United States in the forefront of the
effort against these inhumane weapons. It follows by just 1 week the
announcement by the Canadian Government that it will unilaterally halt
all production, use and export of antipersonnel landmines. In just the
past year, Belgium, France, Austria, Switzerland and the Philippines
have taken similar steps.
It follows by just 2 weeks the announcement in Geneva that 22 nations
have called for an immediate total ban on these weapons.
Mr. President, this amendment represents a dramatic shift in the
policy of the U.S. Government, from one which has lagged behind several
of our NATO allies to one which aims to exert U.S. leadership to build
international support for ridding the world of these inhumane weapons.
That is the goal President Clinton announced at the United Nations
over a year ago. This amendment sets the stage for making that goal a
reality. Once this provision is signed into law, the President, the
Vice President, the Secretary of Defense, the Chairman of the Joint
Chiefs of Staff, the Pentagon bureaucracy, the Secretary of State, and
our U.N. Ambassador should all speak forcefully and with one voice. The
message should be that antipersonnel landmines are unacceptable. They
are indiscriminate, inhumane, impossible to control, and the United
States is going to stop using them and do whatever we can to convince
other governments to join with us in making their use a war crime.
Mr. President, the one amendment in disagreement in the Foreign
Operations conference report which deals with international family
planning has also been resolved, but I want to be sure Senators
understand what the House has done. Essentially, the House has
presented us with a fait accompli. The choice is either take their
offer on the amendment in disagreement, with no opportunity to amend
it, or the entire Foreign Operations budget, with none of the policy
language, will be governed by a continuing resolution.
I know that the distinguished chairman of the Appropriations
Committee, Senator Hatfield, is as frustrated about this as I am. I
certainly intend to do whatever I can to resist these heavy handed
tactics in the future. But given the choice, we have no alternative. A
year long CR at either the House level or 75 percent of fiscal year
1995 levels would be far worse for many important programs.
Our conference report categorically prohibits the use of any funds
for abortion. Yet the House, at the behest of the right-to-life lobby,
would cut $88 million from programs that have only one purpose--to give
couples the means to avoid unwanted pregnancies and reduce the
incidence of abortion. Why anyone would want to do that is beyond me,
but that is what the House has done. Anyone who wants to see fewer
abortions, and fewer women die from botched abortions, should deplore
this action.
The provision in this CR would prohibit the obligation of any family
planning funds--funds to purchase and distribute contraceptives, to
provide technical assistance for improving the quality and safety of
contraceptives, to educate couples about birth spacing--none of these
funds could be spent before July 1 unless they are specifically
authorized.
If there is no authorization bill by that date, and I have yet to
meet anyone who thinks there will be, only 65 percent of the fiscal
year 1995 level for family planning could be obligated, and then only
in monthly installments. The net effect of this will be an $88 million
cut in family planning assistance.
That is the pound of flesh the right-to-life lobby will have won, if
it does not succeed in its goal of reinstating the Mexico City policy--
a policy that has been ridiculed around the world, repeatedly rejected
by the Senate, is opposed by a majority of Americans, and which the
President has said he would veto.
I am very pleased that we successfully resisted attempts to reinstate
the discredited Mexico City policy. I will continue to oppose any
effort to do that. But I will vote for this continuing resolution only
with great reluctance, because of the harm it will do to family
planning.
If I thought there was any way to amend this provision without
jeopardizing the entire conference report, I would not hesitate because
I know a majority of the Senate would support me. Indeed, a majority of
the House would too--although perhaps not a majority of House
Republicans--but the House Republican leadership would never have the
courage to put it to a vote.
Mr. President, the United States has been a leader in the effort to
stabilize the world's exploding rate of population growth. Tens of
millions of people are born into abject poverty every year, but today
we are cutting programs to give couples the means to avoid unwanted
pregnancies. Anyone with an ounce of brains can see that the logical
result will be more abortions, not less. That is what the right-to-life
lobby, and their defenders in the House have accomplished.
Mr. President, I want to thank Senator McConnell, for his efforts to
get this conference report enacted. I also want to pay special tribute
to Senator Hatfield, who has been a strong supporter of funding for
family planning assistance and who played a central role in the
negotiations with the House over the past few days.

International Family Planning

Mr. FEINGOLD. Mr. President, of the many controversial issues in the
continuing resolution we are considering today, few have been as
contentious as

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the debate about international population programs in the foreign
operations appropriations bill. Astoundingly, the entire foreign aid
bill has been held up for months by several antichoice Members, mainly
in the House, who have, illogically, sought to impose restrictions
concerning abortion on international family planning assistance.
These misguided provisions are not included in today's CR. Instead we
are faced with provisions withholding population funds until July 1,
unless there is an authorization, and then limiting funding for the
program to 65 percent of today's levels. It is a victory for those of
us who are prochoice on the question of abortion, but not very good
news for those of us--presumably the vast majority of the Congress, and
including most of the people who fought against the original Senate
provisions--who support family planning. What a bizarre, if not
ridiculous, situation we are in today.
As my colleagues will remember, in the name, supposedly, of stopping
abortion, the House sought to prohibit U.S. contributions to the United
Nations Population Assistance Fund, and reimpose the regressive Mexico
City policy on population. Of course, such propositions would not do
anything to reduce incidents of abortion, but would actually harm
efforts to increase family planning assistance--the best remedy,
obviously, for avoiding abortion. Fortunately, these anti-abortion
restrictions have all been stripped from the foreign ops bill, and
population assistance will not be hindered by irrelevant but damaging
restrictions. In that, we have succeeded, finally, in separating
population assistance from abortion, and have scored a victory for
family planning. The Mexico City policy has been rebuffed by the 104th
Congress, and our support for the work of the UNFPA has been
reaffirmed.
But, Mr. President, the cause of curbing abortion will not be served
well by the cuts in population assistance legislated in this bill. In
fact, the only inroads the antifamily planning forces made today was in
taking gratuitous and harassing shots at the budget for population.
While other programs will be held to 75 percent of current funding
levels, population programs will be funded at only 65 percent of
today's budget. The money will not be distributed until July 1, and
even then, it will be apportioned only on a month-to-month basis. Mr.
President, this is nothing more than a formula for disarray, and will
do nothing to achieve the goals of its sponsors.
Who really believes that the rapid, exponential growth of the world's
population--regardless of our positions on abortion--does not impact
American interests? Population pressures are a linchpin of so many
global concerns, such as economic development, health, food security,
migration, environment, and improving the status of women. Through the
U.S. bilateral population program, as well as our contribution to the
UNFPA, we have affected significant successes in all those fields.
It is beyond me--and saddens me--that these issues have been
entangled in a debate about abortion. It reflects a fundamental
misunderstanding that family planning and abortion are not the same.
Supporters of family planning have been subjected to charges and
insinuations that we support China's appalling coercive abortion
policy; that we want to fund lobbies that promote pro-abortion policies
worldwide; and that we actually want to promote abortion as a method of
family planning. All these propositions are untrue, and are in fact red
herrings. I'm pleased that they have been recognized as such, and
dropped in the final provisions of this bill.
Unfortunately, however, the presumptions that underlie this
thinking--that family planning is somehow not essential to curbing
abortion--are prevailing in this bill. Population assistance should be
treated just as any other foreign aid account, and by subjecting it to
deeper cuts, and odd distribution guidelines, no one's goal is being
reached.

THE EFFECTS OF THE CONTINUING FUNDING RESOLUTION ON THE ENVIRONMENTAL
PROTECTION AGENCY

Mrs. BOXER. Mr. President, this morning Administrator Carol Browner
of the Environmental Protection Agency testified before the Senate
Appropriations Committee on the consequences of this continued funding
resolution. She said that it: ``represents a severe cutback that will
not allow us to adequately protect public health and our environment.
Our air, our water, our land, will not be as safe''.
The cuts in this continued funding resolution compromise our Nation's
public health and environment. This bill appropriates 5.7 billion
dollars for EPA--that's a 14-percent cut--or nearly one billion dollars
from the fiscal year 1995 level. It's a 22.5 percent cut--or 1.7
billion dollars--from the President's fiscal year 1996 request.
Mr. President, the cuts to the Environmental Protection Agency in
this bill mean that an already stretched agency will not be able to
carry out critically important work that ensures the health and safety
of all Americans, and will result in a set-back of national efforts to
ensure that every American citizen breaths clean air, drinks clean
water, and is safe from the dangers of hazardous waste. These are the
EPA funds that are spent working with States and municipalities in the
development of our air quality, water quality, lead abatement, and food
safety standards; the funds that allow EPA to keep track of the level
of pollution in our air, our water, our food, our environment; that
allow the EPA to work with states and with industries to help them
discover the sources of pollution problems and helps they comply with
Federal safety standards; that allow the EPA to give technical
assistance to State pollution control agencies and county air and water
quality boards; that allow the EPA to carry out environmental impact
statements on industry actions that may hurt the environment; that
allow EPA to work all over this country to educate industry and small
business and help comply with the law so that enforcement actions are
avoided. In the long run this will mean more water pollution, more smog
in our cities and countryside, more toxic waste problems. For example
funding cuts are seriously jeopardizing cleanup of 12 toxic superfund
sites in and around the Los Angeles area including the Newark San
Bernadino site and San Gabriel sites.
Republicans seem to take great pride in their efforts to dismantle
key social programs that Americans hold dear, but they have chosen to
take their war against the environment underground. The cuts to the EPA
budget show us the covert war that is being waged by Republicans
against our environment. It has to be covert because they have seen the
results of poll after poll showing that the vast majority of Americans
feel that our environmental laws should be strengthened not stripped
away. In my many years in public office not once has anyone told me,
``Senator, our air is too clean,'' or ``our water is too safe.'' The
back door attack on our environmental laws seen here is cuts in EPA's
budget that will cripple EPA's ability to set and enforce environmental
standards.
This continued funding resolution cuts enforcement of all
environmental programs by 14.6 percent, $77 million from fiscal year
1995. It hits at the heart of EPA administration and management in
EPA's ability to set and enforce environmental and public health
standards with a 7-percent cut, $115 million from fiscal year 1995.
This bill also cuts EPA's budget in other crucial areas: A 9-percent
$110 million cut from fiscal year 1995 in funds that go straight to the
States to help cities all over the country build sewage treatment
plants that keep raw sewage from flowing into our coastal waters,
rivers, lakes, and streams.
A 79-percent; $1 billion cut from the pre-rescissions fiscal year
1995 level in funds that go to States to protect our drinking water
nationwide.
A 13-percent; $168 million cut from fiscal year 1995 in funds that go
toward cleaning up hazardous waste sites.
Mr. President, it is for all these reasons that I am very distressed
at having to have to vote for this continuing resolution.
Mr. LEVIN. Mr. President, I cannot support the continuing resolution
which is before the Senate today. This resolution cuts education funds
to the House passed level, except for those programs that were not
funded by the House in which case they are cut by 25 percent. If we
were to extend this continuing resolution for the remainder of the
fiscal year, the impact would be an

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unprecedented $3.1 billion cut in education funds from the fiscal year
1995 funding level. And, it contains deep cuts in a range of important
domestic priorities, like a 25 percent reduction in the funds to put
100,000 cops on the streets of America. This in a year in which $7
billion more has been appropriated in defense spending than the
Pentagon asked for.
We are presented on the last day before funding once again runs out
for these agencies of the Government and for their programs with a
continuing resolution that makes deep cuts in vital and proven
education programs.
The failure to support a simple continuing resolution that adequately
funds education programs at fiscal year 1995 levels is creating serious
problems for schools, teachers, and students. Our children--America's
future--are the innocent victims of this retreat from education. Here
are just a few examples, Mr. President, of the devastating impact if
the funding level in this continuing resolution is continued through
the remainder of the fiscal year.
The $1 billion cut in title I funding will deny 1.1 million
educationally disadvantaged children the crucial help they need in
reading, writing, math, and critical thinking.
The Safe and Drug Free Schools Program in almost every school
district in the country--more than 14,000--is cut by 25 percent, $115
million less than the fiscal year 1995 level of $466 million. These
programs help schools reduce drug abuse and prevent violence.
The innovative School-to-Work Program, which helps youths make the
transition from school to future careers and education by forming a
three-way partnership between Government, educators, and private
industry is cut by $55 million.
The $93 million cut in Goals 2000 comes at a time nearly 17,000
schools and communities have already completed planning and are
beginning to implement comprehensive reforms based on their own
academic standards and will deny funding to programs serving over 5.1
million children.
The Eisenhower Professional Development Teacher Training Program,
which supports State and local efforts to better prepare educators to
reach high standards in core academic subjects, such as mathematics and
the sciences, is cut by 25 percent or $63 million.
Mr. President, the impact of this continuing resolution will be
immediate and long-lasting because of the way in which school budgets
are set. Now is the time for teacher contracts to be signed. Schools
must by law send layoff notices to teachers as early as March and
April, advising them they will not be rehired in the fall, but
communities cannot make these decisions because the funding is
uncertain. Plans for professional development, technology purchases,
training, and school safety programs could be delayed or eliminated.
Now is the time for cities to submit their school budgets, but they
cannot adequately do this because they do not have any numbers to work
with. Now is the time for colleges to project what aid they will have
to offer newly enrolled students, but they cannot make funding
projections because they have not been told how much they are going to
have to offer students. If students cannot be assured they will have
financial aid, many will have to forgo plans to go to college.
The strategy of causing Government shutdowns and threatening to raise
the debt ceiling, thereby threatening the credit rating of the United
States, has been inappropriate and discredited. We are told by the
majority that there is no longer a quorum available in the House of
Representatives, so we cannot amend this continuing resolution. The
implication is that we have to accept these cuts and make no
adjustments, otherwise the Government would be shutdown tomorrow--the
third time this year. Again, we are painted into a corner. Well the
House can return to work at the call of the Speaker. If we do the right
thing by education, they can quickly do so too.
I think we should reject this bill which does not reflect priorities,
particularly in education and the environment. The Congress should stay
here, all night, all weekend, if necessary, and work out and adopt a
clean continuing resolution with adequate domestic funding and a clean
bill to raise the debt ceiling so that the credit rating of the United
States is not in doubt for weeks to come.
Ms. MOSELEY-BRAUN. Mr. President, I want to say at the outset that
our Federal employees, our financial markets, and our economy in
general, should never have been subjected to the risks created by
shutdowns, threats of shutdowns, and the failure to act responsibly
with respect to the debt ceiling. Hostage-taking and legislative
blackmail is not the way to arrive at the kind of solution we need to
solve our budget problems.
I am a firm believer in tightening our Government's fiscal policies
and will continue to work toward that end. I am convinced that
restoring budget discipline will help ensure that our children--and
future generations--will be able to achieve the American Dream. We have
an obligation to our children to protect their future opportunities,
and not to leave them a legacy of debt.
But passing one short-term funding bill after another--one every few
weeks or so, is not the way to do it. This is unfair to our students
who want to pursue educational opportunities. It is unfair to our
science community whose research is interrupted. It is unfair to
Government employees who want to work. And it is unfair to all others
who depend upon the appropriations contained in these bills.
Of the 13 appropriations bills Congress is supposed to pass every
year, 6 are still undone even though the fiscal year is almost one-
third over. Nine Federal Cabinet departments have been without fully
approved spending plans.
Now, 4 months into the fiscal year, we are considering a fourth
extension. Mr. President, it's time to act on these appropriations
bills--not just by temporary extension, but by getting them passed. We
should not hold these six appropriations bills hostage in the name of
balancing the budget.
It is ironic, isn't it, that the activities financed by these
uncompleted appropriation bills, or what is also known as domestic
discretionary spending, is not the part of Federal spending that has
caused the budget crisis the Federal Government is facing.
Discretionary spending is not the sole problem. Domestic discretionary
spending has not grown as a percentage of the GDP since 1969, the last
time we had a balanced budget. Domestic discretionary spending
comprises only one-sixth of the $1.5 trillion Federal budget, and it is
steadily declining.
Every dollar of Federal spending must be examined to see what can be
done better, and what we no longer need to do. However, the budget
cannot be balanced by looking in this one area, no matter how large the
cuts.
We are debating issues that have little or nothing to do with
balancing the budget.
The budget proposed by the majority party calls for $349 billion in
savings from discretionary spending, but that comes from a portion of
the budget that constitutes only 18 percent of the overall Federal
budget--the part of spending that is not growing and the part of the
budget that funds education and police and basic services we all count
on. This part of the budget is not the major source of our deficit
problem. We need to focus our savings on those areas of the budget that
don't conflict with our priorities and values.
How we bring back fiscal discipline makes a real difference. If we
care about our children, if we care about our future, if we care about
our Nation and ensuring an opportunity for every American to achieve
the American Dream, we cannot abandon our commitment to education,
access to health care, and to creating economic opportunity.
That is why I cosponsored and voted for Senator Kennedy's education
amendment because I believe that we should meet our obligation to our
children and to the future. If the current CR were extended for a full
year, education funding would be cut $3.1 billion below last year's
level. Illinois would lose $72.4 million, including a $54 million cut
in title I funding.
Continuing to fund education programs at 75 percent of their 1995
levels will, at some point, simply become a 25-percent cut in education
funding. Schools that are trying to plan for the coming year will soon
have no choice but to assume a 25-percent cut and plan accordingly.
There are scientists at my alma mater, the University of Chicago, and

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at universities all throughout the Nation, who are awaiting approval of
their grants because the National Science Foundation and NASA do not
know how much money is available and cannot make decisions about grant
awards.
Health and safety inspections at public housing may be forced to
cease. In Chicago last week a tragic fire took four lives; HUD couldn't
check fire alarms due to budgetary uncertainty.
The Fish and Wildlife Service will experience delays in issuing
wetlands permits--Illinois already has a backlog of permit requests
from the last shutdown that is 8 feet tall.
Furthermore, there are five Superfund sites in Illinois, including
Waukegan, Rockford, and East Cape Girardeau, that will experience
delays in cleanups.
Mr. President, these are just a few examples of how my State will be
affected. We need to move to a balanced budget. And we need to do it in
a way that does not sacrifice the long-term goals of the American
people to achieve illusory short-term cuts. We need a budget that
restores fiscal discipline to the Federal Government. We need a budget
based on the realities facing Americans. Most importantly, we need a
budget for our future.
I believe that we can achieve that kind of budget, if we put aside
partisan bickering and political point scoring, and if we get down to
the work the American people elected us to do.
I will reluctantly support this bill not because it's the answer but
because we must avoid a shutdown. I hope we will use the next 45 days
that this CR gives us to reach the kind of overall permanent budget
agreement that the American people want and deserve.

INTERNATIONAL FAMILY PLANNING

Mr. KENNEDY. The continuing resolution being considered will severely
undermine the Nation's support for the International Family Planning
Program. According to the terms of the CR, the International Family
Planning Program will receive funding at only 65 percent of its fiscal
year 1995 level. Also, program administrators will be forced to spend
money in predetermined monthly allotments. Let's not pretend that any
program can work efficiently and effectively in this manner.
We all know the purpose of this provision--the elimination of the
International Family Planning Program. Opponents of abortion apparently
believe that less family planning will lead to fewer abortions. Nothing
could be farther from the truth.
We know that abortions are reduced when family planning services are
available. This CR will lead to serious reductions in family planning.
The effect will be an increase in abortions in other nations. Our
colleagues opposed to abortion should not be encouraging this result.
International family planning is also good international health care
policy. By providing a wide range of services and information, family
planning makes a difference to millions of women around the world. It
is estimated that approximately 300 million women will require family
planning services in the next decade. It is estimated that such
services can prevent 125,000 women from dying of complications related
to pregnancy and childbirth. We know that these programs have reduced
infant mortality. Inevitably, disease, unintended pregnancies,
abortions, and maternal deaths will increase if this restrictive
language continues to apply.
International family planning programs are important to the overall
health of large numbers of women and children in many other countries.
The family planning provision in this CR is bad policy, and it should
be reversed at the next opportunity.
Mrs. FEINSTEIN. Mr. President, today I will gladly vote for the
Kennedy amendment to restore funding for education to last year's
level. Education is an area that we should not shortchange.
The bill before us today will continue funding for programs that do
not yet have year-long funding until March 15. Education programs are
cut $3.1 billion on an annual basis, the largest Federal education cut
in history. This is a cut our schools cannot sustain.
Under this bill, California's elementary and secondary schools could
lose at least $169.8 million. For title I, programs for disadvantaged
students, service to 1 in 5 students could be eliminated. Schools will
have to lay off title I teachers and teaching assistants that provide
those extra services that help these students learn. Programs like Safe
and Drug-free Schools, Goals 2000, and student loans could lose 25
percent. The University of California will lose $111 million, much of
which is student aid.
I am also concerned about the stop-and-go pattern of Federal funding
that we have undergone this year. This is the ninth short-term bill
we've considered. We are almost 4 months into the school year and 3
months into the fiscal year. Once again, we are called on to vote on a
short-term funding measure. This bill only funds programs for 49 days,
until March 15.
These short-term bills are particularly unfair to our schools. Like
businesses, they have to plan. In my State, at the end of January,
courtesy notices go out to teachers who are likely to be laid off.
School districts are beginning to plan their budgets for the next
school year. For title I programs, schools are preparing contracts for
teachers and other personnel. Our school districts cannot effectively
plan with this on-again, off-again funding stream.
Our students, teachers, and administrators should not be held hostage
any longer. I urge my colleagues to join me in voting to restore these
education funds and put education funding on a more stable footing.
Mr. BIDEN. Mr. President, I think it is outrageous that, of all
things to choose, this latest temporary spending bill cuts spending for
the 100,000 Cops on the Beat Program under the 1994 crime law. I want
to make clear that the only reason I'm voting for this continuing
resolution is because it is a compromise and would allow States and
localities to continue hiring cops for the next 49 days. The
alternative is no cops.
But this is a terrible way to implement public policy. This
continuing resolution would, if extended over a full year, cut the Cops
on the Beat Program by over one-half--over $1 billion promised to the
American people for cops on the street. That means that communities
across the Nation would lose over 13,000 police officers. That is
totally unacceptable.
This continuing resolution funds the Cops Program at 75 percent of
the 1995 level for outlays, which was $1.187 billion. Seventy-five
percent of that would be $890 million for the year.
In contrast, full funding for the 100,000 Cops Program for 1996 is
$1.9 billion. That is what we agreed on in the 1994 crime law. That is
what was requested by the President. So this resolution would actually
cut over $1 billion from the Cops on the Beat Program--over one-half--
if it continued for the full year.
Let no one be fooled. This continuing resolution is a back door
attempt by Republicans to reverse the gains of the 100,000 Cops Program
and the American people will not stand for this the next time around.
We all know the Republicans want to change the crime law now at work.
They said so in their Contract With America. We all know the
Republicans want to eliminate the 100,000 Cops on the Beat Program.
They would rather see the money squandered away in a block grant that
funds virtually anything under the sun than to send the money directly
to COPS for the one anticrime measure we know works--community
policing. Cops on the Beat.
The Cops on the Beat Program is overwhelmingly supported by the
American public as well as every major law enforcement group in the
country. I don't know a single responsible police leader, academic
expert, or public official who does not agree that putting more police
officers on our streets and in our neighborhoods is the best way to
fight crime.
Community policing enables police to fight crime on two fronts at
once--they are better positioned to respond and apprehend suspects when
crime occurs, but even more importantly, they are also better
positioned to keep crime from occurring in the first place.
The reports from the field all across the Nation are the same--
community policing works. When it comes to anticrime efforts, the one
thing we know is that more community police officers means less crime.
And we should keep our word to the American people.

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The 1994 crime law targets $8.8 billion for States and localities to
train and hire 100,000 new community police officers over 6 years.
And as we pass the 1-year mark, it is already clear that the Cops
Program is working even beyond expectations. Already, more than 33,000
out of 100,000 cops are funded in every State in the Nation. And
because of the way we've set it up--with a match requirement and
spreading out the cost over a period of years--the money will continue
to work, keeping these cops on the beat and preventing crime in our
communities far into the future. In a word, the law is working.

But that progress will come to a screeching halt if my Republican
colleagues get their way--either through drastic spending cuts as under
this continuing resolution or through block grants with loopholes you
could drive a truck through.
What is one to conclude from the efforts of the Republicans to gut
the 100,000 Cops on the Beat Program? Is it that tax cuts to a few are
more important than protecting the safety of average Americans?
Apparently my Republican colleagues in Washington just don't seem to
get the message. So let me make this crystal clear. If they think that
they will use their new targeted appropriations strategy to kill the
Cops on the Beat Program--to cut $1 billion and thousands of cops--they
are sorely mistaken. I will do everything in my power to prevent the
Republicans from further undermining the 100,000 Cops Program.
So, although this continuing resolution funds cops at 75 percent of
last year's outlays for the next 49 days, this indirect ambush on the
100,000 Cops on the Beat Program--a program demanded by the American
people--will not be tolerated for the full year.

____________________