Congressional Record, Volume 142 Issue 53 (Tuesday, April 23, 1996)

[Congressional Record Volume 142, Number 53 (Tuesday, April 23, 1996)]
[House]
[Pages H3718-H3722]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

FEDERAL TAX DOLLARS AT WORK

The SPEAKER pro tempore. Under the Speaker's announced policy of May
12, 1995, the Chair recognizes the gentleman from Illinois [Mr.
Poshard] for 60 minutes, as the designee of the minority leader.
Mr. POSHARD. Mr. Speaker, in a few weeks back in Illinois we will get
a property tax bill from the county assessor, and it will tell each of
us who owns property in Williamson County, where I live, or in any
other county in Illinois, and I suspect this is true across most parts
of this country where property taxes are assessed and paid, it will
tell us to the penny precisely what our property taxes get for us. It
may very well tell us that out of the, let us say, $2,000 of property
taxes that person might pay, that about $1,500 of that is going to our
local schools. Maybe $50 of it is going to country law enforcement.
Maybe $15 is going to the local airport authority for our airport. But
it will be detailed so that we know precisely to the penny what every
penny of our property taxes is getting for us as a taxpayer in that
county.
Thinking about that I thought, well, why do we not attempt to give
the folks in this country some idea about what their particular Federal
taxes are buying for them by their Federal Government.
We do not get a printout like that to tell us that so much of the
taxes that you pay into the Federal Government are going to pay for the
defense of this Nation or for the health care of our elderly. We do not
get any kind of tax bill to tell us that so much of your tax dollar is
going to educate our children or to build our roads, or anything else.
Agriculture research, science, space and technology, protecting the
environment, we do not know as a people just exactly what percentage of
our Federal taxes go to support any function of government.
But we hear all kinds of things. In fact, there was a survey done
just recently that was printed in newspapers all over this country, and
they asked a number of American citizens what percentage of the Federal
budget do you believe is spent on foreign aid? and the most common
answer given was 30 percent.
Can you imagine that, that American citizens think the Federal
Government is spending 30 cents of every tax dollar that they send to
Washington, sending it abroad to foreign countries? That is what they
thought. And there is probably a good deal of people in this country
that feel that way.
Well, we got to thinking about this, my staff and I, and we said,
``Why don't we do in the best fashion we can what the county does for
us back home with our property taxes? Why don't we try to give the
American people some idea of what their Federal taxes are buying for
them?''
So, we began working with the Congressional Budget Office, with the
Congressional Research Service, with the Library of Congress, and the
Budget Division and so on, and we have come up with a procedure that we
think is pretty accurate to help the American people understand just as
well as we can what their tax dollars are buying for them that they
send to Washington.
I just want to discuss that with the American people tonight. I am
not here to try to debate with anyone about whether they feel this is
the best way to expend our Federal dollars. I am just here to try to
provide some information on a factual basis, rather than a mythical
basis, what the Federal tax dollar buys for our people.
We have had a lot of folks in the last week or so come down here into
the well of the House and say to the American people, ``Well, this year
you are working until May 7 to send your money to Washington to pay
taxes for the Government,'' as though you are working until May 7 and
not getting anything out of the tax dollars that you send to
Washington. It is as if you send them here and they go into some black
hole and they disappear forever, and they do not help anybody with
anything.
Well, that is not a fair way to present it to the American people. If
we want to be honest with the American people, we ought to tell the
other half of the story. We ought to say, here is what your tax dollar
buys for you. Now, you may disagree with us, you may disagree with the
percentage of your tax dollars that go to certain services that are
provided for the American people with it. But you must know that there
are many services that are provided for the American people with your
tax dollar. You have a right to know what those services are and the
proportion of your tax dollar that goes to pay for them.
That is what I want to discuss with you tonight. Now, over here to my
right I have several charts. I need to back this up so I can see it a
little bit, and I am hopeful that the cameras can pretty much stay on
these charts as I begin to explain this to the American people.

The first thing I want to talk to you about are the revenues that
come into the Federal Government. In the last year that we have
calculated these things, which is fiscal year 1995, how many revenues
come in, and where do they come from.
Well, as you can see, the greatest percentage of Federal revenues
come from the individual income taxes, which totaled about $590
billion, or 43.6 percent of the Federal revenue.
The next largest proportion that came in came from social insurance
taxes and contributions, about $484 billion, or 35.7 percent of the
total revenues to the Federal Government.
Now, social insurance taxes include Social Security, Social Security
disability, Medicare, railroad retirement, unemployment compensation
insurance, and Federal employees retirement contributions. Those
together constitute about 35.7 percent of the revenues that come to the
Federal Government, or about $484 billion.
The next highest class of revenues are corporate income taxes, about
$157 billion, or about 11.6 percent of the revenues to the Federal
Government.
Excise taxes, which include things such as gasoline tax, jet fuel
tax, alcohol tax, cigarette tax and so on, brought in about $57,484
million, or about 4.2 percent of the Federal revenues.
All other forms of Federal revenues, be it rents, royalties, interest
or whatever, are about 4.9 percent of the total taxes or revenues that
came to the Federal Government.
This totals for fiscal year 1995 about $1,355,213,000.
Now, during fiscal year 1995, we took in $1,355,213,000 and we spent
$1,519,133,000, or we deficit spent about $163.9 billion. That is, we
borrowed that much money to make up the difference for what we spent
over what we took in.
Now, that is a lot of borrowing, it is true. But just 3 years ago we
were deficit spending $302 billion a year. We have cut the deficit
nearly 50 percent in that period of time. And while we should not make
any excuses for the deficit spending, we want a balanced budget, we
need a balanced budget, we want to get this down to the point in 7
years hopefully where we spend no more than we take in. We have made
great progress on this account in the last 3 years, cutting it by
nearly 50 percent in terms of the Federal Government deficit spending.

So the revenues come from individual income taxes, corporate income
taxes, social insurance taxes and contributions, excise taxes, and
others.
Next chart, please.
Now, what we have done, with the help of the Congressional Budget
Office, is we have taken each of the five different divisions of family
income in this country, in other words, those families in the lowest 20
percent of family income, in the second lowest 20 percent of family
income, in the third lowest 20 percent of family income, in the fourth
highest, and the highest 20 percent of family income, and we have
calculated the average family income in each of these quintiles.
You can see that among those families who are in the lowest 20
percent of family income in America, the average family income is
$8,500 a year. In those families that are in the second lowest 20
percent of family income, their average family income is $20,500 a
year. In the third quintile, it is $33,500 a year, which is the average
family income nationwide in America. The average family income and
those people in the

[[Page H3719]]

fourth highest 20 percent is $49,000 a year. And in the highest 20
percent of family incomes in the country, the average family income is
$111,500 a year.
We went back and we calculated the total of all forms of Federal
taxes in terms of its percentage for each of these levels of family
income averages, and you can see that the average tax rate here
includes Federal individual income tax, Medicare tax, Social Security
tax, corporate income tax, estate and gift taxes, and all forms of
excise taxes, such as Federal airlines, gasoline taxes, cigarette
taxes, alcohol, and so on.

{time} 2100

Mow, in 1981, you can see for the average family income of $8,500 a
year, that family paid a total of 8.3 percent of its average family
income in all of these taxes combined. As you go on up to 1990, that
rose to 8.9 percent; in 1994 it fell to 5.1 percent, which it remains
at today.
So for all four of these quintiles of family income, $8,500 a year
average, $20,500 a year average, $33,500 a year average and $49,000,
the income tax rate, which includes all of these together, these
Federal taxes, has fallen from, for the lowest quintile, 8.3 percent to
5.1 percent in 1995; the second quintile from 15.3 percent to 14.9
percent in 1995; the third quintile from 20 percent to 19.4 percent in
1995; the fourth quintile, from 23.4 percent to 22.2 percent in 1995;
and the highest quintile has risen slightly from 27.4 percent to 27.7
percent between 1981 and 1995.
So with respect to all of the four lower categories of family income,
total Federal taxes has gone down; for the highest it has gone up
slightly, so that if you are a family in 1995 making an average of
$33,500 a year, you will pay for all of these Federal taxes combined,
an average over $6,499. If you are a family making $49,000 a year in
1995, all forms of Federal taxes will cost you $10,878. If you are a
family making $111,500 a year in 1995, all forms of Federal taxes will
cost you $30,885.
Now, what we have done, and we only have delineated here the three
family incomes of $33,500, $49,000 and $111,500, the top three
quintiles, what we have done, then, is go to the Federal budget and we
have applied all of those incomes to each of the broad general
functions of the Federal Government. That is the services that the
Federal Government provides to each of its citizens, and we have
calculated these family incomes to include what percentage of the tax
actually goes to each of these functions as well as that percentage in
actual tax dollars.
So you can see that the function of Government which takes the
highest percentage of our Federal taxes combined is Social Security, to
which Americans paid $335,846,000,000 in fiscal year 1995, which was 22
cents of each tax dollar sent to Washington. And for a family making
$33,500 a year, the average family income in this country, that would
have meant a tax bill of $1,436.50 for Social Security. For a family
making $49,000 a year it would have meant as a portion of their total
tax bill of $10,844, $2,404 going to Social Security. For a family
making $111,000 a year, $6,825 of their $30,000 tax bill goes to Social
Security.

So in order of most to least with respect to the amount of your tax
moneys that go to different functions of Government, this is the order
in which you pay your Federal taxes for, going from highest to lowest.
Social Security takes 22.1 of your tax dollar. So slightly in excess of
22 cents of each of your total Federal tax dollars go to Social
Security.
National defense is the second highest expenditure at $272 billion.
It takes 17.9 or right at 18 cents of each tax dollar that you send to
Washington. The net interest on the debt, which today stands at $4.9
trillion, the net interest on that debt takes 15\1/4\ cents of each tax
dollar that the American family sends to Washington, DC.
Income security is the fourth highest expenditure of the Federal
Government. That includes general retirement and disability,
unemployment compensation, Federal employee retirement, disability,
housing, food and nutrition assistance and other forms of welfare. All
of those things all together take 14\1/2\ cents of each Federal tax
dollar. Medicare is the next highest expenditure, the fifth highest
expenditure. It takes 10\1/2\ cents of each Federal tax dollar. Health
is the next highest expenditure. It takes right at 7\1/2\ cents of each
Federal tax dollar that you send to Washington, DC.
Now, let me point out something here. These top six items, Social
Security, national defense, interest on the debt, income security, to
include all those things I just mentioned, retirement, disability,
unemployment compensation, and Federal employee retirement, housing,
food, et cetera, Medicare and health, those top six functions of the
Federal Government, take 88 cents of every tax dollar that you send to
Washington--88 cents of all Federal tax dollars combined that are sent
to Washington are consumed by those top six expenditures.
If you go on down the line, education, training, employment and
social services take 3\1/2\ cents of your tax dollar; or for the
average American family, $229 of your tax bill. Transportation takes
2\1/2\ cents, or $162 of your tax bill. Veterans benefits and services
take 2\1/2\ cents, or $161 of your overall tax bill, if you are a
family making $33,500 a year.
Natural resources and the environment take nearly 1\1/2\ cents or $92
of your tax bill. General science and space technology takes a little
over 1 cent on each tax dollar you send out here. Foreign affairs takes
a little over 1 cent of your tax dollar that you send to Washington.
Administration of justice takes a little over 1 cent of your tax dollar
that you send to Washington.

General government, which includes the executive and the legislative
branches and other areas that support those, other agencies, takes a
little less than 1 cent of your tax dollar, about 91 hundredths of one
cent. Community and regional development take about three-quarters of
one cent of your tax dollar. Agriculture takes about two-thirds of one
cent of your tax dollars. Energy takes about one-third of one cent of
your tax dollar. And then you get back about 3.8 or nearly 4 cents in
offsets to that through various credits and offsetting receipts to the
Federal Government.
That constitutes 100 percent of your tax bill. And all of these
things together, education, training, employment, social services,
transportation, veterans benefits and services, natural resources and
environment, general science, space and technology, foreign affairs,
international affairs. administration of justice, general government,
community and regional development, agriculture, and energy, all of
those together take 12 cents of your tax dollar. Social Security,
national defense, interest on the debt, income security, Medicare and
health take 88 cents of your tax dollar.
Now what we want to do is break down each of these general functions
of government in a more specific way to show you with some definitive
nature here exactly what percentage of your tax dollar goes to each of
these functions in a more specific way.
Social Security, which is the No. 1 item of Federal spending, which
takes 22.1 cent of each tax dollar, just goes to what it says, Social
Security. It is the money that you pay in over a lifetime, along with
your employer, to support a person who has reached Social Security
retirement age, as well as other disabled people in our country who may
qualify for Social Security. For a family earning $33,500 a year, that
amounts to about $1,436; for a family earning $490,000 it is about
$2,404; and for a family earning $111,000 it is about $6,825.
The second highest expenditure of the National Government, which
takes 17.9 or right at 18 cents of each tax dollar you send here, is
national defense. How is that broken down? Military personnel take
about 4\2/3\ cents of your tax dollar for their salaries, for their
living and so on. Operation and maintenance of our military systems,
about 6 cents of each tax dollar. Procurement of all of the things
which it takes to run our military on, about 3.6 cents of each tax
dollar. Research, development, testing and evaluation of all of our
systems and so on, about 2\1/4\ cents of your tax dollar. Military
construction, about \1/2\ cent of each tax dollar goes toward military
construction. Family housing takes a little less than \1/4\ of 1 cent
for the housing for our military families.

We have some offsets where the military performs certain functions
and makes back about $2 billion a year in terms of sales of equipment
and so on. That is an offset a little bit to your tax bill.

[[Page H3720]]

The atomic energy defense takes a little over \3/4\ of one cent and
other defense related activities about \5/100\ of 1 cent, for a total
of 17.9 or about 18 cents of each tax dollar for all of these functions
of our national defense spending.
For a family, again, earning $33,500 a year, that is about $1,161;
for a family earning $49,000, that is about $1,944 in taxes; and if you
are earning $111,500, it is about $5,519 in your taxes.
The third highest expenditure which your Federal tax dollars pay for
is the interest on the national debt. As you can see, the interest on
the public debt this year is about $332 billion, or about 21.88 percent
of each tax dollar sent here, and that is offset by some of the on-
budget trust funds that we have, which include the transportation trust
fund, our black lung trust fund, the Superfund trust funds and so on,
which goes specifically to be sent on those items I just mentioned.
That is an offset of nearly 4 cents on the dollar. And our off-budget
trust funds, which include Social Security, is an offset of a little
over 2 cents on the dollar.
So our total net interest paid by your Federal taxes is about a
little over 15 cents of each tax dollar, or about $993 for a family
earning $33,500, $1,663 for a family earning $49,000, and $4,722 for a
family earning $111,500 a year.
Our next highest expenditure is what we call income security
spending, and this includes general retirement and disability
insurance. This entire category takes up 14.5 cents of each tax dollar
which you send to Washington. A little less than \1/3\ of one cent goes
to the general retirement and disability insurance, that excludes
Social Security; about 4\1/3\ cents goes to pay Federal employees
retirement and disability; 1\1/2\ cents goes to pay unemployment
compensation;about 1.8 cents of your tax dollar goes for housing
assistance, run through HUD; about 2\1/2\ cents goes for food and
nutrition assistance, including food stamps, the Women, Infant and
Children Program and so on; and about 4 cents of each tax dollar goes
for all other forms of welfare programs.

{time} 2115

So about 14\1/2\ cents of each tax dollar you send here goes for
income security spending, which amounts to, for a family earning
$33,500 a year, about $941; $49,000 family income, about $1,575; and
for a family earning $111,000 a year, about $4,472.
Next chart, please.
The next highest expenditure of your Federal tax dollar is Medicare.
Medicare is the Government-run health care system, as you know, for our
elderly. It takes 10\1/2\ cents of each tax dollar which you send here
to Washington, or, for a family earning $33,500, about $683 of your tax
total; for a family earning $49,000, about $1,144; and for a family
earning $111,000, about $3,249 of your total tax bill will support
Medicare spending in this country.
Next chart, please.
The next highest level of Federal spending is health spending, which
includes health care services, including Medicaid. This entire category
takes up about 7\1/2\ cents of each tax dollar you send here. Medicaid
gets about 6.7 cents of that.
Health research and training, about three quarters of 1 cent to keep
us in the forefront of the best health care provisions in the world.
Consumer and occupational health and safety including the functions
of OSHA, get a very small amount, about 12/100ths of 1 cent of each tax
dollar.
Total combined for Medicaid, health research and training, for
consumer and occupational health and safety, about 7\1/2\ cents of each
tax dollar that you send here. For a family making $33,500 a year, that
is $492; for a family earning $49,000, that is $824; for a family
making $111,500, it is $2,341 that go to these functions.
Next chart, please.
Let me remind you of one thing. Those six categories of Federal
spending that we just talked about from Social Security, national
defense, interest on the debt, Medicare, income security and health
spending, consume 88 cents of each tax dollar that you send to
Washington, DC.
Now we get into the last 12 cents of each tax dollar that you send
here.
Education, training, employment and social services spending consume
3\1/2\ cents of each tax dollar that you send to Washington. About 1
cent of that goes to elementary, secondary, and vocational education;
mainly to vocational education because we at the Federal level assume a
major responsibility for helping to finance vocational education in our
high schools, our communities colleges and so on.

The higher education gets a little less than one cent of each tax
dollar you send here, and most of that goes to student grant and loan
programs and work-study programs to try to help our students get
through college. That amounts to about $14 billion a year.
Research and general education aids get about 13 hundredths of 1 cent
of each tax dollar. Training and employment, which is very important
for our country because we have a turnover of people in our jobs and
employment throughout this country, people get laid off, they lose
their jobs, they need to be retrained, re-employed at another job. We
spend about $7 billion, or about a half of 1 cent of each tax dollar
that you send to Washington, on that function.
Other labor services, including the NLRB and those agencies and so
on, about a 6/100ths of 1 cent, and the social services that we
provide, including mental health and other kinds of things at the
Federal level, less than one cent of each tax dollar that you send
here.
So for all of these things: elementary, secondary and vocational
education, higher education, research and general education aids,
training and employment, other labor services and social services, we
spend 3\1/2\ cents of each tax dollar that you send to Washington. For
an American family making $33,500 a year, that is about $229 of your
tax bill; for a family making $49,000 a year, that is about $384 of
your tax bill, and for a family making $111,000 a year, that is about
$1,090 of your tax bill on education training employment and social
services.
Next chart, please.
The next expenditure is 2\1/2\ cents of each tax dollar you send here
goes to support the transportation system in this country. I think this
is personally one of the biggest bargains the American people can
possibly get. This comes in to the Federal Government in the form of
excise taxes on gasolines and other types of energy consumption. We
spend 1.6 cents of each tax dollar you send to Washington for ground
transportation, maintaining the largest network of interstates in any
country in the world, maintaining State roads with part of the Federal
funding that we send through the States, and we do that for 1.6 cents
of each tax dollar that you send to Washington. We spend two-thirds of
1 cent on air transportation, maintaining the greatest network of
airports, of airport safety, of air transportation in any country in
the world, two-thirds of 1 cent of each tax dollar. We spend about 1
quarter of 1 cent for water transportation, maintaining locks and dams
and the things that move our commercial commerce goods and services up
and down the rivers of this Nation, one-quarter of 1 cent. And other
forms of transportation, less than 1 one-hundredth of 1 cent.

A total of 2\1/2\ cents of every tax dollar you send to Washington
maintains ground, air, water and other forms of transportation. If you
are a family making $33,500 a year, that is a $162 a year; a family
making $49,000, that is $271 a year; a family making $111,000, that is
$772 a year from your tax bill.
Next chart, please.
The next highest expenditure is for veterans benefits and services.
We spend 2\1/2\ cents of your tax dollar to support our veterans. How
do we do that? One-and-a-quarter cents goes for income security for
veterans, retirements, pensions and so on. Seven one-hundredths of 1
cent goes to veterans' education, training, and rehabilitation. A
little over 1 cent goes to veterans' hospital and medical care. A very
small portion goes to veterans' housing, and other benefits and
services take an equally small portion; 2\1/2\ cents of your tax dollar
goes to support veterans benefits. For a family making $33,500, that is
$161 a year; for a family making $49,000, that is $269 a year; for a
family making $111,500, it is $765 a year.
Next chart, please.
Our next highest expenditure, taking up about 1\1/2\ cents of each
tax dollar that you send to Washington, is our natural resources and
environment

[[Page H3721]]

spending. To protect the environment, to conserve our natural
resources, we spend about 1\1/2\ cents of each tax dollar that you send
to Washington, and how is that spent? One-third of 1 cent goes to
protect our water resources. One-third of 1 cent goes to conservation
and land management. Through our Federal Bureau of Land Management,
managing all the Federal lands that we own throughout this country, our
recreational resources take up 18/100ths of 1 cent.
Now, you can take your family to the Grand Teton National Forest
today, you can take them to Yellowstone National Forest, you can bring
them here to Washington, DC, and spend 3 weeks. It will cost you $5 a
carload to go through those great national forests which our tax
dollars manage for recreational purposes for our people. It costs you
nothing to go through the museums here in Washington, DC, and the
Smithsonian, which we manage. All of those recreational things
combined, including our lakes, et cetera, cost a family making $33,000
a year $11.70 a year in their Federal taxes. If you are making $49,000,
it costs you about $19.58.

So, for all of these things, including pollution control and
abatement, which we spend about a half of 1 cent of your tax dollars
on, for all of these things combined, water resources, conservation and
land management, recreational resources, pollution control and
abatement, and protecting our other natural resources, we spend 1\1/2\
cents of every tax dollar you send to Washington. I think that is a
tremendous bargain for the American people.
Next chart, please.
The next highest expenditure is a little over 1 cent of your tax
dollar; 1.10 hundredths of a percent goes to general science and space
spending. We spend one-quarter of 1 cent on science and basic research,
maintaining government laboratories, maintaining grant researches in
our major land grant universities and private universities across this
country, which has kept this country on the cutting edge of
technologies from aviation technology to computer technology, areas in
which we lead the world, contribute to our commerce, to jobs for our
people. We spend, for the family making $33,000 a year, $17 of your tax
bill goes to support science and basic research. NASA gets a little
over three-quarters of 1 cent, space flight research and other
supporting activities of NASA.
There are thousands of products that have spun off of the research
that NASA has performed over the years in our general space exploratory
activities in this country that have accrued to the benefit of private
industry in this country and to every public citizen, and for a family
making $33,000 a year, that is about $53 of your Federal tax bill.
So for general science and space spending we spend a little over 1
cent of your tax dollar for all of that combined.
Next chart please.
International affairs spending. To support our efforts in the
international community, which includes international development and
humanitarian assistance, international security assistance, conduct of
foreign affairs, foreign information and exchange activities, and our
participation in international financial programs, we spend a little
over 1 cent of each tax dollar.

{time} 2130

What is this? Half of 1 cent, or nearly half of that money, goes to
international development and humanitarian assistance. When the deserts
are consuming Africa and rolling over the only arable land we have to
feed people there, and famine is across the land, and disease, and
hunger we send food. We send medicine.
When the Ebola virus is threatening to kill people in other parts of
the world, we send medical technicians who shut it off, who try to
trace down its origins. When AIDS and other things threaten to ravage
countries, we help. That is part of who we are as a country. We spend
one-half of 1 cent of each tax dollar for that kind of international
humanitarian assistance as the greatest economic, military, and
democratic power in the world.
International security assistance. This includes peacekeeping
operations, nuclear disarmament approaches, military loans, et cetera.
One-third of 1 cent of your tax dollar goes to support international
security assistance.
Conduct of foreign affairs, the State Department, a quarter of 1 cent
of your tax dollar goes to our State Department to carry on its
functions.
Foreign information and exchange, about nine one-hundredths of a
cent, and our participation in our international financial programs
returns about $2 billion a year in forms of interest to us. So for a
little over 1 cent on the dollar, we engage in these activities as a
leading international power in the world. Most Americans think we spend
30 cents of every tax dollar on this alone.
In the next chart, the next expenditure is the administration of
justice. The Justice Department and its various activities takes a
little over 1 cent of each tax dollar that you send here. Federal law
enforcement activities, a little less than half of 1 cent. Federal
litigative and judicial activities, including our U.S. attorney's
offices, the people who speak for us in the government in prosecutorial
areas, a little less than a half of 1 cent.
Federal corrections activities, including our Federal corrections
systems and our criminal justice assistance, including legal services
and so on, a little over 1 cent of each tax dollar goes to support our
justice spending in this country.
In the next chart, general government spending is the next category
of Federal spending. It takes up less than 1 cent of each dollar that
you send here. The legislative functions of the Congress take up three
one-hundredths of 1 cent. The executive branch, one one-hundredths of 1
cent. The central fiscal operations, the Treasury Department, a half of
1 cent; the general property and records management, or General
Services Administration, six one-hundredths of 1 cent; the central
personnel management, or Office of Personnel Management, does not even
register, hardly. Our general purpose fiscal activities, other general
government, and so on, the running our Federal Government and the
functions of it in terms of general government spending, a little less
than 1 cent of each tax dollar goes to that.
Community and regional development spending, which is a major
activity back in our home districts, to help our local community
regional economic development associations and so on go out and entice
businesses to locate in our communities by showing them what
infrastructure we have in place, what our labor force is like, et
cetera, the aid and assistance we give them takes less than three-
fourths of 1 cent of each tax dollar that you send here, and that
includes about a quarter of 1 cent to FEMA and our disaster relief and
emergency agencies that serve our communities when they have floods and
other forms of natural disasters to face.
For a family making $33,000 a year, that is about $44 a year. For a
family making $49,000 it is about $7 a year. For a family making $111,
it is about $213 a year.
In the next chart, agriculture spending. I never have a town meeting
without folks standing up saying, ``Stop giving those subsidies to all
those farmers. Those farmers are the fat cats. They are taking up half
of the Federal budget.''
We spend exactly two-thirds of 1 cent of each tax dollar on our
agriculture community. About half of 1 cent goes to farm income
stabilization programs, which we are cutting now, incrementally over
the next 7 years, and eliminating totally.
The remainder of that goes into agriculture research and services so
about two-thirds of 1 cent goes to support agriculture spending by the
Federal Government, which helps supply our agriculture community: the
largest supply of food in the world, the safest supply of food in the
world, and the cheapest supply of food in the world for the American
citizen. The subsidies that people complain about to our farmers really
accrue to the benefits of our consumers, but even those we are cutting
out now.

In the next chart, our next category is energy spending. We spend
one-third of 1 cent on maintaining our energy supplies, our energy
conservation, our emergency energy preparedness, such as our strategic
petroleum reserves and others, in case we get into a war or supplies
are cut off from other parts of

[[Page H3722]]

the world, and our energy information policy; less than three one-
hundredths of a cent.
So for the average American family making $33,000 a year, they are
spending $20 a year in the form of Federal taxes to support an energy
supply, which, again, is the cheapest energy in the world. Today, a
gallon of gasoline in America averages $1.26 cents a gallon. In Canada,
it is well over $3. In Europe, it is over $4.
There are the offset which accrue of about 4 cents on the dollar to
the American taxpayers. The Federal Government gets a mortgage credit
of about $1 billion back; in the Postal Service, about $1 billion 800
million in FDIC deposit insurance, about $17 billion. It costs us a
little over $6 billion for the Commerce Department to advertise and try
to advance our commerce around the world.
The employer share of employee retirement is about $34 billion. The
rents and royalties on the Outer Continental Shelf for drilling and
exploring and so on, about $2.4 billion. Other offsetting receipts,
about $7 billion. So we get back, for the taxpayer, nearly 4 cents on
the tax dollar in terms of these offsetting receipts and credits.
I want to go back to this one chart again, because this capsulizes
everything. Again, by function of government, what is it the tax dollar
buys, from top to bottom? Twenty-two cents of each dollar buys Social
Security for our people; 17.9 cents, or 18 cents, buys national
defense; 15 cents, a little more, is interest on the debt; 14\1/2\
cents is income security for all those things we talked about
previously; 10\1/2\ cents goes to Medicare. Nearly 8 cents goes to
health; education, training, employment, and social services, 3\1/2\
cents of the dollar; transportation, 2\1/2\ cent; veterans' benefits,
2\1/2\ cents; natural resources and environment, 1\1/2\ cents; general
science, space and technology, a little over 1 cent; international
affairs, 1 cent; administration of justice, 1 cent; general government,
1 cent; community and regional development, three-quarters of 1 cent;
agriculture, two-thirds of 1 cent; energy, one-third of 1 cent; and
about 4 cents of the dollar in offsets and credits. That is what the
Federal tax dollar buys for the American public.
For a family making $33,500 a year, that is $6,478 in all forms of
Federal taxes. For a family making $49,000 a year, that is $10,800, in
all forms of Federal taxes. For a family making $111,500, that is
$30,786, in all forms of Federal taxes.
The point is, Mr. Speaker, we can do better. We can do better in some
of these categories. There are debates raging out here right now about
what we do to stabilize the Social Security fund before it goes broke
in the year 2030. How do we continue to provide for my generation,
which is in its fifties, and for my son's generation, in their
twenties, to have Social Security that they have paid in all their
life, as the present generation has provided? Maybe there are things we
can do to invest more wisely, or allow people to invest more wisely to
stabilize that fund.
We have cut national defense considerably over the past several
years. We are downsizing that area of the Federal Government, but we
cannot downsize it much more.
Our net interest is the area we have to work on, because we need a
balanced budget. We need to balance this budget. We need to reduce
interest as a portion of our Federal debt. We are making headway on
that deficit, but we have to go all the way to zero deficit spending.
That is why the debate is raging out here about how we get there, and
the two great political parties are sharing their philosophical notions
about how we get there. It is my hope and prayer we will get there, for
the benefit of our children.
Medicare and part of the income security and health dealing with
Medicaid and other health care services, we are right now debating here
ways to lower the cost of the government with respect to those health
care programs which are the fastest rising parts of the Federal budget.
We are going more toward managed care. Other types of things we are
doing to try to lower the cost in these major areas. This is the
discretionary area of the budget. These things are the entitlement
areas of the budget. Everything has to be on the table.

But let me say this, Mr. Speaker. For those people who come down here
and say, ``Well, we have worked until May 7 this year for the Federal
Government,'' please tell the rest of the story. Please say that for
those 4 months, we provided Social Security for our elderly and defense
for our Nation, and we took care of health care problems and Medicare
and health research and education and training for our unemployed; that
we provided the best transportation system in the world; we helped our
veterans; we took care of our environment and preserved our natural
resources; we engaged in general science and space exploration; we
conducted our international affairs as the leading power in the world;
we had a justice system in which we maintained the FBI, the CIA, the
BATF, the Federal prison system.
Please say that we spent only 1 cent on the dollar to operate this
Congress and the executive department and the various agencies that
serve this Congress and the executive department, and the General
Services Administration and the Department of the Treasury, the Office
of Personnel Management, and all these things; less than a cent on the
tax dollar.
We have to tell the rest of the story, that we have engaged in
community and regional development to the benefit of our communities in
providing for sewer systems, water systems, other infrastructure
developments that we have helped with, which greatly promote the
economy and the commerce of this Nation, on very little as a percentage
of our tax dollar; that we have supported the income security of our
farm community, which has provided the cheapest, most plentiful, safest
food supply in the history of any country in the world, and we have fed
most of the world for many, many years. Say that.
The only thing I want to say is this: that the whole story is that it
may be true that we worked until May 7 to pay our taxes to the Federal
Government, but the rest of the story is that we get a lot of very good
benefits. We can do better. We can save more, we can spend less, and we
shall. But the American people ought to know, too, that we are
struggling to give them what I think is the best we can do for the tax
dollars that they send. It is not just coming here and going into a
black hole. It is not just coming here and being wasted away.
Is there fraud and abuse? Yes. Should we get it out? Yes. It is
incumbent upon every agency of the Federal Government and the oversight
function of this Congress to give assurance to the American people that
we are tightening restrictions, we are doing everything possible to
make sure that we are spending this money in the most cost-effective,
efficient way possible on behalf of the American people.

{time} 2145

We are trying to do that.
My only purpose here tonight was to try to give the American people
some sense of what their tax dollar is being spent for. That is all. I
hope that we can agree that it is being spent not in some of the ways
that the Americans people are thinking, like 30 percent of it going to
foreign aid, but that we are trying to do our best to serve our people
with the income that they do send us.

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