[Congressional Record Volume 142, Number 24 (Tuesday, February 27, 1996)]
[House]
[Page H1259]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                            THE DEBT CEILING

  The SPEAKER pro tempore. Under the Speaker's announced policy of May 
12, 1995, the gentleman from Michigan [Mr. Smith] is recognized during 
morning business for 5 minutes.
  Mr. SMITH of Michigan. Mr. Speaker, this morning the headlines on the 
Congress Daily, the little newspaper that goes out on the Hill every 
day, says Senator Domenici recommends that the increase in the debt 
ceiling be used as leverage to make sure we get on a glidepath to a 
balanced budget. There were 160 of us, Mr. Speaker, as you know very 
well, that sent a letter to the President of the United States saying 
that we are not going to vote for an increase in the debt ceiling 
unless we do get on that glidepath to a balanced budget.
  I brought this chart this morning to explain why it is so important 
that we insist to the full extent of our ability that we make changes 
in some of those entitlement programs, make some changes in those 
welfare programs that are leading us to pass higher and higher debt 
ceiling and more and more borrowing.
  As my colleagues see on this pie chart, the bottom blue part of that 
pie chart that now represents 50 percent of the $1.6 trillion annual 
spending is the welfare programs and the entitlement programs, the so-
called mandatory spending, now using up half of the Federal budget. As 
a point of reference, I would just suggest that, if we look back to the 
year, for example, 1955, mandatory spending only represented 3 percent 
of the total Federal budget spending.
  The Constitution of the United States says that Congress is 
responsible for controlling the purse strings. It is responsible for 
spending. But what has happened in the last 40 years is Congress has 
given away that authority to legislation that says, if you meet these 
certain qualifications, of age or poverty or whatever, you are 
automatically entitled to these payments. It is no longer annual 
appropriation bills that are controlled by Congress. A majority in 
Congress can no longer control or reduce that spending that is using up 
50 percent of this Nation's budget without the consent of the 
President.
  So the question has been, how do you get a reluctant President that 
does not want to cut spending to make some of the changes in these 
welfare and entitlement programs? We have suggested that we are going 
to be as vigorous as we can in suggesting that, look, what causes most 
of the increased debt is the entitlement programs. Therefore, it is not 
only reasonable but they are inextricably tied to each other, the debt 
ceiling increase and changes in some of these welfare entitlement 
spending programs.

  If my colleagues were to take a look at the other provisions of this 
pie chart, the green represents defense spending. Everybody agrees now 
that there has got to be a defense spending. In fact, the 
administration is suggesting that even now we might need a supplemental 
to cover the expenses of Bosnia. But the hawks and the doves, the 
Republicans and Democrats, conservatives and liberals, all of us agree 
on defense, there is little difference, a plus or minus 10-percent 
deviation on what the expenditures should be on defense.
  So like the entitlement programs, most of defense is now on, if you 
will, automatic pilot. It is automatically a spending obligation of 
this country. What is also on automatic pilot is interest rates. So the 
interest on the national debt last year at $270 billion represented the 
total budget of the United States just back in 1977.
  This country, this Government, and the expenditures of this 
Government and this huge bureaucracy continue to grow out of control 
because politicians in Washington have found sort of an undercover way 
to expand the size of government without the safeguards and protections 
of individual citizens that do not want their taxes raised too high. 
That is by more and more borrowing.
  Somehow we do not feel that that borrowing affects our lives. I stand 
here today to suggest to my colleagues very aggressively that not only 
is it immoral to pass on what we consider important expenditures today 
and make our kids and our grandkids pay for it, out of money they have 
not even earned yet, but it is also tremendously a negative factor in 
economic expansion. Government borrows almost 42 percent of all of the 
money lent out in this country. We are driving interest rates as high 
as 2 percent more than they otherwise would be.
  Chairman Greenspan, the Chairman of the Federal Reserve, suggested 
that if we can balance the budget, interest rates would drop 2 percent. 
If interest rates dropped 2 percent, he and other economists are saying 
this economy would take off like it has never taken off before in the 
history of this country and we would have more and better jobs and a 
stronger economy.

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