[Congressional Record Volume 142, Number 33 (Tuesday, March 12, 1996)]
[House]
[Pages H2111-H2114]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
OBJECTIVES OF NEW REPUBLICAN MAJORITY IN 104TH CONGRESS
The SPEAKER pro tempore. Under the Speaker's announced policy of May
12, 1995, the gentleman from Connecticut [Mr. Shays] is recognized for
60 minutes.
Mr. SHAYS. Mr. Speaker, it is not my intention to use the full hour,
but I would like to address the Chamber in regards to a number of
issues dealing with what we are seeking to do in this new 104th
Congress, this new Republican majority.
Mr. Speaker, I said earlier in part of a special order that former
Prime Minister Rabin, the Prime Minister of Israel, had said that
politicians are elected by adults to represent the children. I am
struck by the power of that statement, because really what our task is
as Americans, certainly in government, is to leave this country better
for the generation that will follow. That is what our forefathers did
for us. They founded a country and left it better for us, and we have
to leave it better for our children.
Mr. Speaker, we have three main objectives in this Republican
Congress: This is to seek to get our financial house in order and
finally to balance our Federal budget, we are looking to save our trust
funds, particularly Medicare, from insolvency, bankruptcy, and we are
looking to transform our caretaking, social, corporate, even farming,
welfare state into what I would refer to as a caring opportunity
society.
We are not looking to throw our hands into the air and say, ``Listen,
this is not a problem with the government, you're on your own.'' We are
looking to help people grow the seeds. We just do not want to keep
handing them the food.
We as Members of Congress have a solemn pledge to do a number of
things, but obviously one of them is to vote on a Federal budget each
year.
What some of the listening audience may not know and something I did
not fully grasp, even after I was elected a Member of Congress in 1987,
was that whereas on the State level I voted on one budget, here in
Washington we vote on 13 separate appropriations bills, but they only
constitute one-third of all the spending that we do in Washington.
When we vote out a budget, we are voting on one-third. When we vote,
we vote on one-third. We think of how we spend one-third of the budget.
Fifty percent of the budget is literally on automatic pilot. It is what
we call our entitlements, it is food stamps, Medicare, Medicaid,
welfare for mothers and children. It is agricultural subsidies. You fit
the title, you get the money. We in Congress do not vote on it each
year. It is on automatic pilot.
I can remember early on in my career as a Member of Congress, I would
go back in a community meeting and I would say ``I voted to cut
spending,'' and they said, ``I know you did, but how come it keeps
going up?'' It is a good question. I went back to my office and I said,
``How come if we keep voting to cut spending and they actually pass,
the budget keeps going up?''
I realized that in Washington, unlike any place I have ever been
before, they use what they call a baseline budget. They say this is
what it cost this year, and to run the same level of service, if it
cost $100 million this year, and it is going to run to the same level
of service, we spend $105 million to run the same level of service. So
then if you only appropriate and spend $103 million, Washington calls
it a $2 million cut.
If it costs $100 million and you spend $103 million, how can you call
it a cut? It is a $3 million increase. The argument is you have more
people and you have inflation, and so that is the baseline. Therefore,
anything cut from the baseline is cut. I guess that is how you get
these outrageous predictions that when we have voted on the budget that
we have cut things like the earned income tax credit. This is a payment
that goes to a working person who pays no taxes because they do not
make enough to pay taxes, so they actually get money from the Federal
Government.
The earned income tax credit was a program that was really
inaugurated by Republicans but then expanded by Democrats, and the
program is simply at a point where it will become the largest
entitlement if we do not slow its growth. So we are allowing the
program to grow from $19.9 billion in the last year to, in 2002, 6
years from now, $25.4 billion. That is referred to as a cut, and yet it
is going from $19.9 billion to $25.4 billion. Only in Washington when
you spend that much more money do people call it a cut.
The school lunch program, remembering the President and legislative
leaders on the other side of the aisle literally going to schools,
telling kids that they are going to lose their school lunch program
because of what this new majority was doing in Congress. Yet when I
look at that program, it is growing from $5.2 to $6.8 billion in the
seventh year. Only in Washington when you go from $5.2 billion to $6.8
billion do people call it a cut. It is not a cut, it is a significant
increase in spending. Admittedly it is not growing at 5.2 percent, it
is growing at 4.5 percent. Then we are allowing States to reallocate 20
percent of that money for other programs dealing with food for Kids.
The student loan program, I was outraged when I heard Republicans
were going to cut the student loan program, because, I mean, that is
what the President said and the President would be, it seems to me,
wanting to be accurate in his statement. When I questioned my own
colleagues, I wrestled with the fact that the student loan program last
year was $24.5 billion. In the seventh year, in 2002, the year we
balance our budget, it grows to $36.4 billion. That is a $12 billion
increase, $12 billion on top of the $24 billion spent last year, a 50-
percent increase in the student loan program We are still allowing
students to borrow up to $49,000. The average loan will still be
$17,000.
What did we originally attempt to do? When a student graduates, they
are given a grace period of 6 months before they have to start paying
back the loan. The Federal Government, the taxpayers, men and women who
work who pay money into this general fund of the Federal Government,
were paying and are paying the interest from
[[Page H2112]]
graduation to that first 6 months. Our proposal was that you simply
take that period of 6 months and you say that student pays the
interest, and we amortize it during the 10 years that the student is
allowed to pay back the loan. In some cases they are given more than 10
years, but 10 years tends to be the average.
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So we are saying that a student will have to pay the interest from
graduation to the first 6 months, and no longer it will be the
taxpayers. Believe it or not, we save in the 7 years about $4 billion
doing that, close to it.
Now, what did it amount to in terms of the student costs? Because we
amortized it during that 10-year period, it amounts to about $9 more
for the average $17,000 loan. Nine dollars more is the cost of a pizza.
It is also the cost of a move and the most inexpensive soda.
I have no trouble whatsoever telling the student who has borrowed
money from the Federal Government at lower interest rates that they are
going to pay $9 more a month in order to save $4 billion for the
taxpayers of this country.
So we are increasing the student loan 50 percent, not cutting it;
increasing it.
The Medicaid program, which is health care for the poor and nursing
care for the elderly poor, it is growing under our plan this last year
$89 billion to $127 billion. Only in Washington when you go from $89
billion to $127 billion do people call it a cut. It is not a cut. It is
a significant, almost a gigantic increase in spending funded by the
taxpayers.
Medicare is going to grow from $178 billion, which it was this last
year, to $289 billion, over $100 billion more spent in the seventh year
than spent today. We will be spending 60 percent more in the course of
the seventh year to what it was last year, and people say, well, that
is 60 percent more. But you have all of these elderly people who are
growing into the system. It is accurate we do have more elderly, but on
a per elderly, it is going to grow 49 percent, going to grow from
$4,800 to $7,100 per beneficiary.
What we are doing with Medicare? We are going to save $270 billion,
that number, by the Congressional Budget Office, was moved to $240
billion. The President called it a cut. We viewed it as a savings,
particularly since we knew we were going to spend more each and every
year. I mean $4,800 per beneficiary. Per senior, the $7,100 is a
significant increase, not a cut, a significant increase, a 50 percent
of 49 percent increase per beneficiary in the seventh year. But
referred to as a cut.
I was trying to wrestle with this idea how the President and others
and my colleagues on the other side of the aisle could call it a cut,
and it would be like if my daughter was able, if we were able to afford
it, we told our daughter that she could buy a new automobile, she could
buy a Taurus automobile for $20,000 retail price and the dealership A
sold it for $20,000 and dealership B sold it for $17,000 for the same
automobile instead of 20.
I would hardly tell her that the $20,000 we gave her to spend that
she was foolish and irresponsible because she saved $3,000 buying the
same automobile. Now like in the argument that she could buy this
automobile for $20,000 in one dealer and buy a better automobile, one
that had a sunroof and had a few extra points, a better engine, other
features to it, and if she bought it for 17, I would hardly say that
she cut the program, that she was foolishly saving but not saving,
cutting, when she was doing what I would hope any rational person would
do, get a better program and spend less to do it.
Now, how could we possibly say that by saving $270 billion we are or
$240 billion later, scored by the Congressional Budget Office, we are
getting a better program? That on the face of it seemed like it looked
too good to be true.
I think most seniors could answer why it is true. There is not a
senior, not a senior who cannot describe the extraordinary fraud in
some cases, and the outrageous abuses we see in this program. It is a
great program, but it is a very, very wasteful program. We look to save
money. We save $240 billion in Medicare by not increasing the
copayments on seniors. Maybe we should have, but we did not. Not
increasing the deductible, maybe we should have. We did not. Not
increasing the premium on seniors, we kept it at 31.5 percent. Now,
31.5 percent of the premium, that is on Medicare part B, is going to
cost more each year because 31.5 percent, as health care costs go up,
that premium will cost more the taxpayer, though, is still going to pay
68.5 percent. That tax revenue is coming out of general funds. We have
Medicare part A, which is the hospital program, and we have Medicare
Part B, the health care services, all the equipment, all the doctors
costs, all the other costs associated with serving health care, non-
hospital costs.
Now, what we learned last year and actually in the years before, we
were being told, not listening, this Congress is the first Congress
that said we are going to do something about it, we learned that
Medicare was going to go bankrupt, insolvent, starting this year,
according to the trustees, five of whom are the President's appointees,
and we learned that, in fact, this was going to happen.
So what we looked to do is to save money in the Medicare part A trust
fund and save money in the Medicare part B trust fund. We looked to do
that so the program would not go bankrupt. What we then found out is
last year, instead of $4 billion more going into the fund than going
out, in Medicare part A, did not happen. In fact, $36 million more went
out than went in; $36 million in this program is not gigantic, but we
were supposed to have $4 billion more coming into the program, which
did not. I mean that sets off alarm bells to any rational person. That
says, my gosh, this fund is going insolvent 1 year sooner than we were
told and by $4 billion more than we expected that it would happen.
What did we do then? We did not increase the copayment. We did not
increase the deductible. We did not increase the premium. We left it at
31.5 percent. What did we do? We said the wealthier, if you made more
than $125,000, would have to pay all of Medicare part B, not just 31.5
percent, all of it. It is still the best deal in the world for seniors.
But if you make $125,000, that is not well known, Republicans do not
like the wealthy to know we want them to pay more, I guess it is not
the Republican thing. I am hard-pressed to know why Democrats clearly
do not want people to know Republicans are asking the wealthier to pay
more, because Democrats like to tell people the Republicans just want
to help the wealthy and hurt the poor. That is simply not true. But
that is what they like to say. So Democrats are not sharing that the
wealthier are paying more and Republicans are not making that point
either.
The fact is if you make over $125,000 of taxable income, you will pay
all of Medicare part B. That gives us $9 billion more of our $244
billion savings. Where do we find the biggest savings? The biggest
savings is not we slow the growth of payments to doctors and hospitals,
which we do, not as much as the President, but we do, the biggest
savings is that we allow seniors for the first time to have choice in
Medicare.
Why would that save money? Because the Federal Government does such a
pathetic job of controlling the growth of these programs that there is
just simply a lot of opportunity to save. Now, we are allowing private
sector, the private sector to get involved. When the private sector
gets involved, they cannot say you are going to get less than you are
going to under Medicare part B, they cannot say that because they are
not allowed to have that happen. They have to provide the same level of
service or better.
The fact remains, if they cannot offer anything less and charge less,
they have to attract seniors. The way they attract seniors is they say
we will give you eye care, dental care, we will give you prescription
care, costs of helping pay prescription drugs. They will also in some
cases say we will rebate the copay or deductible, maybe we will pay the
Medigap. That is the difference between what Medicare pays and what the
beneficiary has to pay. Quite often they want to shield themselves from
any costs, so they simply buy a Medigap program.
There will be some private sector groups that will come in and do all
of the above or part of the above, but they will make it less expensive
than it is for a senior today.
Now, seniors can stay in the old system. They can stay in the fee-
for-service. They can get Medicare just as they
[[Page H2113]]
have gotten it. They do not have to leave. If they leave and they do
not like the program, they do not like the program, what they do, they
leave, they have the opportunity to go right back into the private care
model. They have the opportunity to go right back every 30 days for the
next 24 months.
A senior who moves into private care who does not like it, maybe does
not like the doctors, does not like the program, does not feel they are
getting the kind of care they want, does not think the Medigap coverage
or the dental care, prescription care, warrants their leaving their
fee-for-service, they can go right back into the traditional fee-for-
service system.
It is amazing, but the plan saves an extraordinary amount of money
because the private sector simply is going to police the system better
than the Government sector does.
Now, I chair the Medicare task force and Medicaid task force for the
Committee on the Budget. I am also chairing the Human Resource
Committee that oversees the Department of HHS. We oversee HUD, Labor,
Education, and Veterans Affairs, but we also oversee HHS, Health and
Human Services. That means we oversee FDA, HCFA, which is the Health
Care Administration, that basically handles Medicare programs. We
oversee the Centers for Disease Control. We have looked into the
Medicaid program, the Medicare program. It is astounding to know that
we have contracted out to private carriers simply to police the system,
but we do not give them any incentives to do it right.
Basically, the carriers do not have the bottom line kind of ability
in a bill that is presented on Medicare, if a doctor takes care of
someone's broken or sprained ankle, and they do a chest x-ray, which is
clearly not related to the sprained ankle, they can submit the bill and
know it is likely it will be paid, even though it should not be paid,
because HCFA does not require any more than 5 percent of the bills to
be checked and only less than 1 percent, less than 1 percent of all the
dollar amounts of bills to be checked.
So what has the GAO told us, the Government Accounting Office, what
have the inspectors general told us? They said, if there was a basic
auto-adjudicated system, with software to kick out these inappropriate
bills, the Federal Government would save about a half a billion
dollars.
Well, that is your government at work. The Government, your
government at work chooses not to save a half a billion dollars. The
Government has set up a Byzantine system of changing the purchase of
health care products. We know that the Veterans' Administration is able
to buy a particular product that Medicare pays, and for the last 4
years has paid $4 billion more than the Veterans' Administration pays
for that same product. In other words, if we paid the same price for
what the Veterans' Administration pays for that particular product, the
Federal Government, the taxpayers, would have saved over $4 billion.
I can go on. I mean, why is it that men under Medicaid are sometimes,
and Medicare, Medicare particularly, why would they have been charged
for giving birth. It is humanly impossible, but it happens. And we go
on and on.
I mean I had in one of my community meetings, I always have people
come up and tell me the outrageous bills that they get. One of them was
a nurse, and she said she knew health care services, she knew that this
bill was incorrect. She had looked at it, knew it was incorrect, and
went to the hospital. The hospital said, well, we are not properly paid
by Medicare, so we have to find other bills in order to get what we
think we are properly due.
It is why doctors sometimes go into nursing homes, poke their head in
a window, Emily, how are you doing, John, how are you doing? They see
15 people in 15 minutes, and they are able to make out like bandits. I
mean I can go on and on.
One of the ways we save in our Medicare plan is that we make health
care a Federal offense, finally we prevent people from going State to
State. We are going to save billions of dollars by finally getting
tough, finally in a Federal way against abuse in Medicare.
Now, there is lots I could deal with and talk about as I yield the
floor. I do not want to just make mention of a few more issues. I know
this looks like a food fight to a lot of people. Republicans and
Democrats on the floor yell at each other. I am not proud of that. We
look like Little League deciding who is safe at second. In fact, we
probably are doing a disservice to Little League to say we look like
Little League. They might take issue at that. We are pretty childish at
times.
I guess my point to this Chamber, to put it on the record, is that
this is not a food fight. It is an epic battle about what kind of
country we are going to become. I look and think of what we have done,
allowing the Federal debt since the Vietnam War to go from $430 billion
to now $4,900 billion. In 22 years, in 22 years, we have allowed the
Federal debt to increase ten-fold. That is during the time of peace. It
is not during a time of war when you just spend whatever you have to
spend and then you pray that you will succeed in your battle against,
in this case, Hitler's Germany. We just spent what we had to and we
ended up with a sizable debt.
But since the Vietnam war we have allowed the debt to increase ten-
fold, ten-fold in 22 years. I think of what I like to think of myself,
as a historian, I certainly would appreciate it, that was my college
degree in American history. I think of how historians graded the
Congress after the death of Lincoln, the Reconstruction Congresses.
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It is not a proud time in our history, the time after the Civil War.
I think that historians will look at the Congresses over the last 22
years, and even the White House of both parties, and say this was not
our proudest moment. I think I am being kind. I think they will say it
was one of the darkest times in our history, when we have literally
been willing to mortgage our children's future for present-day
expenses.
I do not think that when historians will look at what we have done in
Congress, in the White House, and, candidly, I think historians will be
not complementary even of the American people, because the American
people, as much as they may feel they are not part of this process,
they are very much a part of it.
I would have liked to have shut down the Government after
Thanksgiving break and not open it up. I was on the losing side in my
own conference. I think it was a mistake to open the Government until
we balanced the budget. I regret dearly that we did.
I think it is a mistake to vote out increasing the national debt
until we come to grips with the balancing the budget. I prayed that
Congresses of earlier years and the White House of earlier years would
have, at least one of them, would say no more, we are not going to
allow these deficits to continue. We are not going to mortgage our
children's future. We care to leave this country better than we found
it. If only 10 years ago a Congress or White House, one of them had
said no more, we are not going to allow this to continue.
So I say well, you know, it did not happen. We are not going to shut
down the Government I do not suspect. We crossed that line, and I guess
we will just continue working day by day until the White House and
Congress come to grips. We need to have an agreement, but it cannot be
a superficial one. It has got to be a substantive agreement.
How did I start this special order? I started this special order by
pointing out that 50 percent of our budget are entitlements. Fifty
percent of our budget. We do not vote on them, they are on automatic
pilot. Only one-third of the budget is what we vote on, the 13
different budget items.
Congress has the upper hand in the negotiations with the President on
appropriations. He vetoes a budget, the Government shuts down. That is
not good necessarily for us or the President, but it calls the
question. And it is certainly not something Federal employees wanted.
They are caught in the middle.
But it is much bigger than Federal employees. It is whether we are
going to finally come to grips with the budget. When the President
vetoes entitlements like he did, when he vetoed our balanced budget
bill, when we wanted to reform Medicare and Medicaid and welfare, what
did we end up with? Not nothing. We ended up with what exists, the
automatic pilot, what is existing law.
So for Congress to simply cave in and allow the President to allow
and force
[[Page H2114]]
us to spend more on appropriations without a corresponding change in
entitlements would be very foolish and irresponsible, in my judgment.
I learned a great term when I was in graduate school when I was
getting my MBA and MPA and majoring in economics, a concept I wish I
had learned earlier. It is called opportunity costs. If you spend money
here, you give up the money to spend it here. If you spend money here,
you give up the opportunity to spend it here. If you spend some money
here, you can maybe spend some money here. But you give up
opportunities, depending on how much you spend.
Our entitlements are growing at 10, 11, 12 percent. If we do not get
a handle on the growth of Medicare and Medicaid, if we cannot slow
Medicare and Medicaid to about 7 percent a year, and prevent them from
growing at 9, 10, 11 percent, if they go up at 9, 10, 11 percent, then
the appropriations part of our budget is going to be continuing to be
squeezed and squeezed and squeezed. Our need to help our young children
dealing with teenage pregnancies, a whole host of things I think are
necessary, are simply not going to be able to be funded, if we just
allow entitlements to grow and grow and grow.
I know a number of good Members in both the House and Senate are
quitting. They say this is not a fun place anymore. I am hard pressed.
I have been here 7 years and I love this job, and I have never felt I
have been critical of serving in Washington. I love Washington. I love
this opportunity. I mean, this Congress was formed by our Founding
Fathers in the Constitution of the United States. I mean, I look at
this flag with great reverence. I look at the Constitution with great
reverence, and I look at what the Constitution did. It established a
Congress, it established a Senate, it established a White House,
and they knew there would be times we have disagreements.
Our Founding Fathers knew that sometimes it might even look like
kids, but they knew that ultimately we would have a system to resolve
our differences.
So I just ask the American people to see beyond just this debate that
seems to not be as substantive as they want, and look for the fact that
this truly is an epic battle. I would encourage some of my colleagues
who are quitting and not running again because they say this is not a
fun place to level with the American people and acknowledge this really
has never been a fun place. It has been an important place, but not a
fun place.
Candidly, I am not so sure it matters whether it is a fun place
anymore. I am not even certain that the issue of whether we are always
civil to each other is an overriding issue. It is not pretty to look
at, and I regret it and like to think I am not a part of that kind of
dialog. But when I see some of the people I have admired over the years
quitting, and I admit I do not walk in their shoes, their moccasins, I
do not know what their life experiences are, but it seems to me on the
outside looking in on what they are doing, that they really were part
of a Congress over the years that allowed us to get in the mess we are
in.
We are in this mess, and it is very serious, and it requires a lot of
heavy lifting. We have got to confront the seniors, we have got to
confront the young, we have got to confront the rich and poor, and we
have got to come to solutions to our problems.
It is a very contentious time. My take on their leaving, not to be
unkind, is that simply that now that the difficulties are here, now
that we are clawing to get out of the deep hole we find ourselves in,
they are quitting. They are quitting when it is tough. They helped get
us in this mess, and, frankly, I think they should stay to help get us
out of this mess.
When I hear a colleague say, ``Well, now that I am not running again,
I can really be honest with the American people,'' I am thinking to
myself, why were you not honest when you were running? Tell the
American people the truth. They are going to have you do the right
thing. Tell the American people things that just simply do not add up,
and they are going to give you confused messages. So I think it is a
shame they just did not tell them the truth while they were candidates.
If they told the American people the truth, I do not think we would be
in the mess we are in today.
Mr. Speaker, with that, I have a sense you were not sure that this
was going to be as long a time as it has turned out to be, and I notice
a colleague on the other side of the aisle, so you will probably be
here a little longer than you wanted, but I thank you for giving me
this opportunity.
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