[Congressional Record Volume 142, Number 60 (Friday, May 3, 1996)]
[Senate]
[Pages S4684-S4685]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                  THE VETERANS' ADMINISTRATION BUDGET

  Mr. BOND. Mr. President, just to follow up very briefly on what the 
majority leader said, the Wall Street Journal earlier this week pointed 
out that the tax increases in 1993 had the effect of costing jobs and 
economic growth in this country. Two economists, William Beach and 
Scott Hodge, at the Heritage Foundation, used the very reputable 
econometric model, the Washington University macro model, to try to 
figure out what happened as a result of that 1993 budget deal. They 
calculated it reduced private sector jobs by 1.2 million. We lost $208 
billion in output, or the equivalent of $2,100 per family. What is 
worse, they found out the tax increases did not reduce the deficit as 
much as predicted because tax increases change behavior and not all the 
taxes were generated. Only about 56 cents of additional deficit 
reduction came for every $1 of new taxes. So that did not work very 
well.
  Now the majority leader has talked about how we need to get the 
budget in balance by cutting spending. I wanted to share very briefly 
today with my colleagues something that went on in

[[Page S4685]]

our appropriations subcommittee for VA and HUD today. We had before us 
the Secretary of the agency, Secretary Brown. We showed him the budget 
projections. This chart shows what the Congress' budget projection was 
last year. This green line shows a flat line across here.
  Actually, we raised that to this level. Last year the Secretary said 
holding the Veterans' Administration budget flat through 2002 would be 
devastating; hospitals would be closed, veterans would not be served, 
there would be tremendous hardship, the system could not operate. He 
said the system could not operate with flat appropriations, even though 
the number of veterans is declining.
  So I asked him what would happen, because this is the Clinton 
projection. These are the Clinton administration numbers for the 
Veterans' Administration budget, going up here in 1997, one more year, 
and then just plummeting, plummeting by more than $3 billion a year out 
of just slightly over a $16 billion budget. This, coming down according 
to the CBO, this would be just around $13 billion or less for the 
Veterans' Administration.
  The Secretary said he could not live with, and the veterans could not 
be served by, that budget. So I asked him if he were going to send out 
the e-mail messages and statements in pay stubs that he had sent to the 
employees of the VA last year when we proposed this budget. He said no. 
I asked him why not. He said, because the President has personally 
assured him he will negotiate the budget with him and take care of the 
veterans.
  I asked him, I said, ``Are you concerned that the President is going 
to live with that budget number that shows the budget plummeting for 
VA?'' He indicated to me that he had no concern whatsoever that the 
Veterans' Administration budget would fall like that, because the 
President promised to negotiate with him.
  I had to ask the question, and I ask it again. Who is the President 
fooling? Is he fooling the taxpayers and Congress when he proposes a 
budget like that that purports to cut it and cut the budget for the 
Veterans' Administration a total of $13 billion in this period? Or is 
he fooling the veterans by telling them, do not worry, we will keep 
spending up however high it needs to go? Whichever way it goes, it has 
to call into question whether the President is serious about these 
budget negotiations. He said that he wants to balance the budget.
  We have the President on record and we have OMB on record as saying 
they want to balance the budget. How are they going to do it? Well, 
they have some very draconian cuts in their appropriated spending 
accounts. This red line shows how sharply those cuts are going to be 
made. This is the President's entire budget, and he hopes to get to a 
balance in 2002 by cutting it like that.
  Part of those cuts are reflected in this precipitous cut in the VA 
budget, showing this for the Veterans' Administration only. But he is 
telling the people, the constituents of the Veterans' Administration, 
or they believe he is saying, ``Don't worry, we'll negotiate with you a 
good budget and take care of you.''
  We have the promise, on the one hand, of OMB that this is a 
meaningful budget that shows a reduction of appropriated spending 
sufficient to balance the budget in the year 2002 under President 
Clinton's plan. On the other hand, we have the assurance, the 
confidence of one of the agency administrators whose budget is going to 
be slashed that it will not be slashed. That is the best of both 
possible worlds.
  For the vast majority of American citizens who want to see a balanced 
budget, you have these numbers in a budget, but it is really a no pain-
no gain situation, because you tell the people who will be directly 
affected, ``Don't worry because we don't mean this; don't worry, the 
budget's not going to come down like that.''
  Mr. President, what they must be telling us is it is all for show. It 
sounds good to tell the American people we are going to balance the 
budget, but we can sure get out and get the word to all of the people 
who depend upon those particular agencies, ``Don't worry, your agency 
is not being cut; your agency is not going to suffer any reductions.''
  Mr. President, I think the issue of credibility and character are 
going to be very important in this fall's election, and I think this 
budget flimflam tells a lot. I think it raises questions about the 
honesty of the plan that we are being presented on behalf of the 
Clinton administration by OMB. They would like us to think the budget 
is going to be balanced, but they assure the people in the area, plan 
for the cuts, that that $13 billion will not be cut out of the VA 
budget. Is it going to be cut someplace else? I doubt they will be 
willing to say someplace else will be cut even more.
  I thank the Chair. I note several colleagues wishing to speak. I 
yield the floor.
  Mr. COHEN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Maine.

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