[Congressional Record Volume 143, Number 14 (Thursday, February 6, 1997)]
[Senate]
[Pages S1079-S1099]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

  The Senate continued with the consideration of the joint resolution.
  Mr. GRAHAM addressed the Chair.
  The PRESIDING OFFICER (Mr. Grams). The Senator from Florida.
  Mr. GRAHAM. I thank the Chair.
  Mr. President, we as a Nation have come to an important crossroads in 
our history. We must decide whether or not we should alter our supreme 
and most respected document, the U.S. Constitution, to establish the 
principle of a balanced Federal budget.
  As we all know, regrettably our Nation is deeply in debt and goes 
more so each year. The budget deficit has become a permanent fixture of 
our Nation's fiscal policy. While there are those who say we can 
without a constitutional amendment balance the budget, recent history 
raises serious doubts.
  Mr. President, I should like to humanize this issue by putting it in 
the context of a family, my family. My father was born in Croswell, MI, 
in 1885--February 10, 1885, to be exact. When he was born, the national 
debt, after almost 100 years of American history, after having 
purchased Louisiana from the French, having fought the Revolution, the 
War of 1812, the Civil War, we had accumulated a total national debt on 
the day my dad was born of $1.6 billion. If you took the population of 
the United States in February of 1885 and divided it by that $1.6 
billion national debt, my father came into the Earth owing $28. That 
was his share of the national debt.
  I was born in November 1936. On that date, the national debt was 
$33.8 billion. Between my dad's birth and my birth, we had fought the 
Spanish-American War, the First World War, and suffered a deep 
depression, which we still were in the midst of on the date of my 
birth. On that day, dividing the then national debt by the then 
population, I owed $264. That was my indebtedness to the Nation at the 
time of my arrival.
  My first child was born in January 1963. When Gwen was born, the 
national debt was $310 billion. In 1963. That was not very long ago in 
the scale of life. And my daughter owed $1,640. That was her share of 
the national debt as recently as January of 1963. And 27 years after 
her birth, my daughter Gwen had a daughter, Sarah. Sarah was born in 
1990, and upon her birth the national debt, if you can believe it, had 
soared from $310 billion 27 years earlier to $3.2 trillion when my 
first granddaughter, Sarah Logan, was born. Sarah came into this world 
with a proportion of the national debt of $12,830.
  Since Sarah's birth, I have had seven other grandchildren, the most 
recent born in 1995. When those four grandchildren, triplet 
granddaughters and a grandson, Mark Ernest, were born, the national 
debt had soared again now to $4.9 trillion, or they came into the Earth 
with a indebtedness of $18,932.
  Between my father's birth, with a $28 indebtedness, to my youngest 
grandchild's birth, $18,932 per person is what we have inflicted upon 
our children, our grandchildren, and generations beyond.
  Such history has brought me to the conclusion that if we are to 
reverse this profligate policy, if we are to begin to return to the 
principles of our parents and grandparents, we, unlike they, must have 
the discipline of a constitutional amendment which will require that 
each generation assume responsibility for its indebtedness.
  I make these observations not without recognition that we have made 
considerable progress in recent years in terms of gaining some control 
over our deficit. America reached its all-time high, in terms of an 
annual deficit, in 1992. In 1992 the national deficit soared to over 
$290 billion in that one year. It took us 100 years to get to $1.6 
billion. In one year we had a deficit of $290 billion.
  This year, the estimate is that our deficit will be $107 billion. So 
we have made substantial progress and I believe that President Clinton 
and the Members of Congress during this period deserve some recognition 
for the fact that we have pulled that line of deficits in a downward 
position, albeit still, each year, contributing substantially to our 
accumulated national debt.
  But, despite this progress, current projections forecast large 
deficits into

[[Page S1080]]

the future. Our national debt is expected to reach not the $4.9 
trillion that it was in 1995, but $5.4 trillion at the end of this 
fiscal year, by the end of September of 1997.
  With this history in mind, and witnessing numerous attempts--many of 
which carry the names of Members of Congress--attempts and failures to 
enact legislation to force ourselves to meet the standard of a balanced 
budget, I believe the time has come to pass an amendment to the 
Constitution to mandate a balanced budget. It is unfortunate that we 
need a constitutional amendment to force us to do something that we 
ought to do voluntarily. However, a constitutional amendment is 
necessary to provide Congress and Presidents, today and in the future, 
with the necessary constitutional backbone to maintain a policy of a 
balanced budget.
  I have long supported a balanced budget amendment. I am an original 
cosponsor of the current amendment that is before us this afternoon. I 
support an amendment as an important principle, both to maintain the 
momentum of the last 4 years toward reducing and eliminating the annual 
deficits, and to assure that, once we are at a point of balance, we 
will stay there. It is imperative that we not let this opportunity pass 
by, that we not lose the progress of the last 4 years. We must continue 
on a path toward a balanced Federal budget by the year 2002.
  If I could speak in the context of my State of Florida, we have a 
unique interest in the outcome of this debate. Florida will continue to 
grow. It will be one of the fastest growing States in the Nation. Our 
population, which today is something over 14 million people, is 
projected to reach over 16 million by the year 2005. The benefits of a 
balanced budget amendment are national and numerous, but one of the 
most important benefits, as recognized by virtually all economists, is 
that a balanced Federal budget will lead to lower interest rates and 
increased economic growth.
  Americans deserve the benefits that a balanced budget will bring and 
the people of my State, citizens in a State which each year must 
finance the consequences of growth--additional homes, schools, all of 
the things that a growing population requires--with money which has 
largely been borrowed, will benefit especially by the lower interest 
rates that a balanced Federal budget will bring.
  If capital is readily available at reduce cost, virtually everything 
Americans do that involves borrowing money is easier and will have a 
positive financial impact on States with expanding population, such as 
Florida. Most States have a constitutional requirement for a balanced 
budget within their own fiscal houses. As a State legislator, and for 8 
years as Governor of Florida, I operated with a balanced budget 
amendment to our State Constitution and with a balanced budget. I can 
say from that experience that this requirement of a balanced budget in 
our State constitution, and the fidelity of generations of State 
officials to that objective, has served my State well. It will serve 
America well. I will support the specifics of this amendment because I 
believe that this specific amendment is better than the status quo, is 
better than the history of the last century. But I think we should not 
let this opportunity pass without striving for additional perfection in 
this amendment.
  The U.S. Constitution appropriately is not amended frequently, or 
without the most serious considerations. Therefore, whenever its 
amendment is considered, we should give attention to the details of 
that amendment and strive to assure that we are leaving to future 
Americans the best possible statement of national policy. To this end, 
next week or as soon thereafter as possible, I will offer an amendment 
to the balanced budget amendment that will strive to accomplish four 
things.
  First, it will eliminate almost $2 trillion in the total debt that we 
will accumulate over the next 25 years under the amendment in its 
current form. Second, the amendment to the balanced budget amendment 
that I will offer will protect our Social Security trust fund. Third, 
it will stimulate economic growth. Finally, it will be honest with the 
American people, by being consistent with their expectations of what a 
balanced budget truly means.
  The failure to pass a balanced budget amendment this year will be a 
great mistake. For too many years we have delayed the hard discussions 
until tomorrow. Mr. President, tomorrow has come. It is our 
generation's duty to assure that we pay our Nation's bills rather than 
asking our children and grandchildren to do so. It is our challenge to 
pass a constitutional amendment to establish as a national policy that 
each generation of Americans will balance its Nation's budget.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I cannot tell you how much I personally 
appreciate the distinguished Senator from Florida, his courage and 
boldness in standing up for the balanced budget amendment, which he has 
always done. He and Senator Bryan are the two principal Democratic 
cosponsors of this amendment, and they have both worked very hard with 
us to try to bring this to fruition, not only on the floor but through 
the whole Congress. I want to personally thank him for his kind 
remarks, good remarks this day, and I look forward to the rest of the 
debate.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mr. SESSIONS. Mr. President, I am honored to rise to address this 
Chamber and I am reminded of the responsibility given to me by my 
fellow Alabamians. It is both an honor and privilege to represent the 
people of Alabama, and I will devote all my resources toward ensuring 
that their best and most honest instincts are well served in this 
institution.
  I am also delighted to have heard the remarks of the senior Senator 
from Florida. Those remarks are most pertinent and important for us 
all.
  I think, also, I should note the great respect that I have for 
Senator Hatch and the work he has done on building a balanced budget 
amendment that is sound and that will be a good addition to our 
Constitution. It is a well-written amendment and it ought to be passed 
in its present form.
  I think it is, indeed, appropriate that the first bill under 
consideration on the floor of the U.S. Senate, is the balanced budget 
amendment. The people of Alabama have made their support for this 
legislation clear, and I intend to do all I can to ensure that they 
have the opportunity to have this amendment placed before them for 
their ratification. Americans know through experience that Washington 
cannot be trusted to keep its financial house in order. This has been 
demonstrated to them by Washington's failure to balance more than one 
budget in the last 28 years. The 28 years of unbalanced budgets stacked 
right here before us demonstrate Congresses past history of failure.
  Americans know the burdens of Washington's excesses are going to fall 
primarily on their children, a result which is unjust and 
unconscionable. They have reached the same conclusions that I have: 
Enactment of the balanced budget amendment is the only way Washington's 
tax-and-spend mentality can be curbed and provides the only way for 
integrity and accountability in Government spending. It will force us 
to honestly confront the issues and to make choices.
  Someone has suggested we really don't need to amend the Constitution, 
the budget deficit is dropping. But in Judiciary hearings last week, 
Senator Biden, a senior Democratic Senator from Delaware, discussed 
that very point.
  He noted at the time that the only reason, in his opinion budget 
deficits have been dropping is because of the fear that this body and 
the House, along with the President, would pass a balanced budget 
amendment. Without discipline, budget deficits will increase again at 
an alarming rate. That is why Senator Biden supported a balanced budget 
amendment.
  The arguments in favor of a balanced budget amendment are not new. In 
fact, the concerns Americans raise today were advocated by our Founding 
Fathers, and none more vocal than Thomas Jefferson. Where today's 
families worry about the crushing debt that is being passed onto their 
children, Jefferson warned, and I quote, ``Each successive generation 
ought to be guaranteed against dissipations and corruptions of those 
preceding.''

[[Page S1081]]

  And corruption it is. It is irresponsibility. It is a corruption of 
the highest duties and responsibilities of office in this Government 
that we fail to make the hard choices when confronted with competing 
priorities and simply adopt both priorities and pass that debt to our 
children.
  During the first Judiciary Committee hearing on this bill, Senator 
Orrin Hatch placed a debt clock before us. It graphically illustrated 
the point. Each second that passes sees another $4,500 being added to 
our national debt. Think about that. The national debt is growing at 
the rate of $4,500 a second, $270,000 a minute, $16,200,000 an hour, 
$388,800,000 a day. This is in addition to the current national debt of 
$5.2 trillion.
  At this moment, our current debt is equal to a $20,000 obligation 
being placed on every man, woman, and child in this country, and it is 
our children who will face the brunt of this problem. Make no mistake, 
the increases in today's debt will be funded directly by taxes levied 
on our children and grandchildren, limiting the opportunity for them to 
enjoy the same standard of living we enjoy. By continuing these 
practices, we are mortgaging their right to participate in the American 
dream.
  Having paid no heed to Jefferson's advice, we have failed to protect 
our Nation from the dissipations and corruptions of the present 
generation. Indeed, we have violated the very principle of our 
founding: taxation without representation. We are, in effect, taxing 
future generations without their consent as a result of our own 
irresponsibility.
  I would like to take a moment to reflect upon the tragic waste of 
resources that the interest on this debt is causing us. We lose $800 
million a day simply on interest payments. In fact, over the course of 
a fiscal year, we spend nearly as much money on interest payments as we 
do on the Nation's defense. For example, in the year 1995, we spent 
$232 billion on interest on the debt and $273 billion on defense. The 
money we use to pay the interest on the debt is money that could be 
diverted to other areas or simply returned to the American taxpayer. 
This is an intolerable waste of our resources. A balanced budget 
amendment would offer protection against a continued waste of our 
revenue resources.
  A balanced budget amendment would also afford protection against 
another evil Jefferson foresaw: the inability of Congress to restrain 
its spending with any degree of self-discipline. When Jefferson warned, 
``Public debt is the greatest of dangers to be feared by a republican 
government,'' he did so because he could foresee that self-interested 
politicians could be expected to choose spending over restraint and 
responsibility. Our $5.2 trillion national debt is a sad testament to 
that fact. Our inability to live within our means on the national level 
is unacceptable and adds to the increasing lack of confidence the 
American public--who must live within its budgets--feels for its 
Federal Government.
  On this point, I am reminded of a story arising at the time I served 
as U.S. attorney and attended a Federal Judiciary Conference. The 
attending judges were complaining because Congress was requiring 
sentencing guidelines that would restrict their ability to sentence. In 
fact, the guidelines mandated certain sentences for certain types of 
offenses.
  At one point, a senior judge stated to the entire conference: 
``Gentlemen, the plain fact is, the U.S. Congress no longer trusts you 
to sentence.''
  The fact today is that the American people no longer trust the 
President or the Congress to bring their spending in order. They are 
insisting upon a balanced budget amendment to end the deficit, because 
it is a people's initiative.
  A constitutional amendment is needed, I submit to you, because we 
have a systemic weakness. We have observed in the last 28 years, by 
these budget deficits here before us, that this Congress cannot be 
trusted. Our system is weak without fiscal discipline, and it is proper 
and appropriate for this body and the people of the United States to 
amend that Constitution and fix that systemic weakness.
  A balanced budget amendment is needed to regain the people's trust, 
because the people know that there has not been a balanced budget since 
1969, and they know that we are continuing to run budget deficit after 
budget deficit. They are skeptical of our ability to keep our promises, 
because they do not believe that we have the political will to keep 
them without a law requiring it. And they are right.
  When Treasury Secretary Rubin testified before the Judiciary 
Committee, I asked him about the current administration's commitment to 
a balanced budget. I specifically asked him how he could commit to 
achieving a balanced budget in 2002 when neither he nor President 
Clinton would even be in office at that time, because under the 
Constitution, President Clinton will leave office in the year 2000. 
They cannot give an answer to that, and that is the point.
  Mr. President, I was pleased to hear the President speak of the need 
for a balanced budget in his address to the Nation. But what needs to 
be remembered in this debate is that while the President may offer 
visions of a balanced budget, and he may offer timelines for achieving 
that goal, he will not be in office when the target date for the 
balance arrives and therefore cannot be held accountable.
  In essence, the promises of a balanced budget are nothing more than 
illusory commitments. Simply offering a vision of balance will not 
guide this Nation to its goal. An efficient enforcement mechanism needs 
to be in place in order to ensure that a commitment to a balanced 
budget becomes a reality. This is especially true when an 
administration proposes a budget in which much of the budget savings 
are backloaded with the supposed balance to be occurring in the years 
after they leave office.
  Such ``out-of-sight, out-of-mind'' proposals are a shunning of 
responsibility and reflect the same business-as-usual thinking that has 
led us to the fiscal trouble we now face.
  In truth, the only instrument capable of creating the kind of binding 
discipline needed to bring our budgets in balance is this amendment. 
While ending deficits may be tough for pork-addicted politicians and 
for inefficient Government agencies and departments, it will become 
much easier, once the people speak, with this amendment.
  Remember, there will be economic benefits from balancing the budget, 
such as increased savings and lower interest rates. The American public 
would also be the recipient of another important benefit--that of 
greater political independence.
  On this issue, former Senator Paul Simon, a Democrat from Illinois, 
and a supporter of the balanced budget amendment, has raised a 
significant and often overlooked point. During testimony before the 
Judiciary Committee, Senator Simon noted that limiting our ability to 
increase our debt will necessarily mean that we reduce the amount of 
our Nation's debt held by foreign governments.
  He recounted a jarring story in which he was once approached by a 
Treasury official before an important pending vote on a Saudi Arabian 
arms sale. The official told him that if the vote failed to pass, the 
Saudis might stop buying bonds which finance our debt. This sort of 
economic extortion is intolerable. American policymaking is and should 
always remain the sole province of the American people's 
representatives, not foreign bondholders. As most people know, it is 
not a good idea to get into a fight with your banker.
  The time to restore the American people's trust is now. We simply 
cannot afford to let this opportunity pass us by. As I campaigned 
throughout Alabama last summer I was struck by the unanimous and 
universal support this amendment enjoyed. Whether I was meeting peanut 
farmers in Dothan or teachers in Mobile, small businessmen in 
Huntsville or police officers in Birmingham, the support for this 
amendment remained constant and strong.
  The broad-based support is not confined simply to Alabama but is also 
reflected nationally. Survey after survey shows that over 80 percent of 
the American public supports enacting a balanced budget amendment. In 
fact, support for this concept has already been powerfully demonstrated 
on the State level with 48 States having enacted provisions which 
restrict each State's ability to incur debt, including my home State of 
Alabama. And it works well.
  Support for this amendment is so wide ranging that it transcends 
party

[[Page S1082]]

lines. I note with some interest that my predecessor, former Senator 
Howell Heflin of Alabama, and a Democrat, introduced a balanced budget 
amendment as his very first piece of legislation in 1979.
  Further, bipartisan support was evidenced in last year's vote on the 
issue, a vote which saw Republicans and Democrats in both Houses come 
together to fall just one vote short of passage. The reason for this 
bipartisan support is clear: The American people demand and deserve an 
opportunity to consider and vote on this amendment. I trust in the 
judgment of the American people to assess this amendment's merits as 
well as its defects, and I encourage my fellow Members to trust in the 
American people's collective wisdom as well.
  As I began this speech by quoting Thomas Jefferson, I would like to 
finish it by quoting another of our Founding Fathers, George 
Washington. I believe his words are applicable to our current debate. 
In his words:

       * * * whatsoever is unfinished of our system of public 
     credit can not be benefited by procrastination; and as far as 
     may be practicable we ought to place that credit on grounds 
     which can not be disturbed, and to prevent that progressive 
     accumulation of debt which must ultimately endanger all 
     governments.

  Mr. President, the balanced budget amendment does place our credit on 
``grounds which can not be disturbed'' and would prevent future 
accumulations of debt. It has been 200 years since Washington uttered 
these sentiments. We have procrastinated long enough. The time to pass 
the balanced budget amendment is now. Thank you very much. Mr. 
President, I yield the floor.
  Mr. HATCH. Mr. President, I want to compliment the distinguished 
Senator from Alabama. When Senator Heflin left the Senate, I have to 
say that I personally felt very badly about it. But I think Senator 
Heflin, who worked very hard for the balanced budget amendment, would 
really have appreciated this wonderful set of remarks that the 
distinguished Senator from Alabama gave today. I want to compliment him 
for it.
  Mr. President, as I understand it, there was a unanimous-consent 
request. I ask unanimous consent, if I can get this, that the order be 
Senator Grams, who I understand was supposed to go first, then Senator 
Byrd, then finally Senator Durbin, who has an amendment that he will 
bring forward. I ask unanimous consent for that.
  Mr. LEAHY. Reserving the right to object.
  Mr. HATCH. With the right of the minority leader to come and speak 
whenever he desires.
  Mr. LEAHY. Thank you.
  Mr. President, I will not object, knowing the right of the 
distinguished Democratic leader, Mr. Daschle, to speak has been 
protected.
  Mr. HATCH. Yes.
  Mr. LEAHY. I know the distinguished Senator from Utah would do that 
in any event. I will not object. But I would like to make one comment 
after the order is entered.
  The PRESIDING OFFICER (Mr. Enzi). Is there objection? Without 
objection, it is so ordered.
  Mr. LEAHY. Mr. President, the distinguished Senator from Utah--if I 
might have his attention for one moment--the distinguished Senator from 
Utah and I have tried very hard to have speakers pro and con. It is my 
understanding that the distinguished majority leader wants this debate 
to go on for a few days, and as well it should.
  Also, I understand the distinguished Senator from Utah wanted an 
opportunity for some of the new Members of the Senate to speak on this, 
as well they should. It is an important issue.
  I urge those who do wish to speak to cooperate with the floor 
leaders, as they have. The distinguished Senator from Utah and I have 
been trying to do this informally--not through an order, but 
informally--to have one Member speak in favor of the amendment, one 
Member speak in opposition to the amendment, and go back and forth so 
the debate will bear relevance to the issue. I hope that all Senators 
will understand that and will work and cooperate with the two of us to 
make that possible.
  Mr. HATCH. I thank the distinguished Senator. We will do that, except 
if the floor is vacant we will let whoever is here speak.
  Mr. LEAHY. Of course. That is right.
  Mr. HATCH. Whether in opposition or a proponent of the amendment. So 
we will just work this out and work together. I yield the floor.
  Mr. GRAMS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. GRAMS. Thank you very much, Mr. President.
  I commend the chairman, the Senator from Utah, for all the hard work 
he has done on this amendment.
  Mr. President, it was 2 years ago I rose as a freshman Member of this 
body to express my strong support for a constitutional amendment to 
balance the Federal budget. ``There is no question that Congress must 
pass a balanced budget amendment and send it to the States for 
ratification.'' That is what I said here on the Senate floor.
  I thought that with the will of the American people behind us, at 
that time we had every reason to be optimistic about its passage.
  Well, here we are again, 2 years later, debating the same question we 
debated in 1995. And I am here once again to call for the passage of 
the balanced budget amendment.
  We have already heard many of the arguments in support of Senate 
Joint Resolution 1, and I will not use this opportunity to repeat them 
all. But let it simply be said that there are indeed many.
  However, the release of the President's budget just this morning 
illustrates just how difficult it is to produce a balanced budget void 
of gimmicks and accounting tricks, and illustrates the very real need 
for the balanced budget amendment.
  Mr. President, this morning we got a first glimpse of the President's 
budget for fiscal year 1998. After a quick review of this massive 
document, I must say my initial feeling has been mixed.
  On the one hand, I am pleased that the President has agreed to many 
of our goals, such as a balanced budget by the year 2002, tax relief 
for American families, and Medicare reform, and a strong national 
defense.
  On the other hand, I am very concerned about what I see as serious 
flaws included in the President's plan.
  Let me begin my observations with the President's education 
proposals, which he described in his State of the Union Address as ``My 
No. 1 priority for the next four years.''
  The President proposes $51 billion for education spending next year. 
That is an increase of 20 percent, rising to nearly $60 billion by the 
year 2002, a 40-percent increase.
  This includes $36 billion in tax incentives for education and 
training; $5 billion for school construction; $1.2 billion for a new 
reading program; and increased funding to connect schools to the 
Internet.
  Mr. President, we all agree that there exists a strong correlation 
between education and steady economic growth.
  Investing in the skills and abilities of the future U.S. work force 
will enable us to achieve and maintain high levels of knowledge and 
productivity in the workplace--helping to improve our standard of 
living and ability to remain globally competitive.
  However, the core question is not whether the Government should 
invest in education, but how those taxpayer dollars should be spent--
and, ultimately, whether more spending is the answer to our education 
problems.
  The United States has outspent every other G-7 country in education 
and leads in the attainment of secondary and university degrees. Our 
total government spending in all levels of education as a percentage of 
GDP has increased from 4.8 percent in 1985 to 5.1 percent in 1993--the 
highest among the G-7 countries. Eighty-four percent of our population 
successfully completes secondary education--once again, that is the 
highest among the G-7 countries. Twenty-four percent of our population 
receive a college or university diploma, a percentage more than twice 
that of Germany, the United Kingdom and France. It is significantly 
greater than that of Japan.
  Despite hundreds of billions of dollars in education spending and 
hundreds of Federal programs, American students continue to perform 
poorly compared to students in other countries, particularly in terms 
of basic science and math skills. The science

[[Page S1083]]

and math scores of our students are the lowest among Canada, France, 
Italy, Switzerland, Taiwan, and Korea. Our Scholastic Aptitude Test 
scores among college-bound students have barely increased over the last 
decade, and remain below those scores attained in the 1960's and 70's.
  We are spending more and achieving less. Clearly, this proves that 
spending more money on education is not the solution. If it were, the 
United States would have long been No. 1 in the world in attaining 
academic success. Unfortunately, throwing more money at the problem 
appears to be this administration's only solution. The administration 
would do well to look at my State of Minnesota, where a recent study 
conducted by the St. Paul Pioneer Press showed that the school 
districts with the highest per-student spending produced test scores 
that were among the lowest.
  The President's education plan fails miserably at addressing the real 
issues that face our Nation. This is unacceptable. We must dedicate 
ourselves to improving our education system, but we must do it right.
  First and foremost, in my view, an honest education budget should be 
one that restores and revives our traditional values in American 
education: It should ensure our current resources are used efficiently; 
it must have incentives built into Federal programs to reward students 
as well as teachers who improve their performance; it must focus on 
improving basic science and math skills of our primary and secondary 
school students; it must ensure a crime- and drug-free learning 
environment; it must ensure that taxpayer dollars are actually helping 
educate our youth.
  Now let me turn to the President's tax proposals. I am pleased the 
President has acknowledged the tremendous good we accomplish by 
allowing working families to keep a little bit of their own money 
through the child tax credit. The President has moved one step closer 
to the $500 per-child tax credit my Republican colleagues and I have 
long been advocating, and we welcome him on board. However, there still 
exists a big gap between his proposal and ours.
  First of all, the President's child tax credit has too many 
limitations. For instance, the President extends his tax credit only to 
preteen children, those under 13 years of age, taking away the tax 
credit dollars just when families need them most. In the President's 
budget, the tax credit begins at only a $300 per-child for the first 3 
years and is finally increased to $500 in the year 2000. Moreover, the 
President's plan begins phasing out the tax credit for families with a 
combined income of $60,000, with more limited credits for families 
making as much as $75,000. Finally, the President's tax credit would 
not be available unless deficit reduction targets are met.

  Now these limitations greatly dilute the purpose of child tax relief. 
The extensive debate we have undertaken in the past 2 years over fiscal 
policy has helped us understand that working families are indeed 
overtaxed. In fact, families today spend more on taxes than on food, 
clothing, and shelter combined. A $500 per child tax credit--without 
limitation--is more appropriate and necessary to allow families to make 
more of their own spending decisions.
  As a long-time advocate for tax relief, I would prefer a zero capital 
gains tax on all investment incomes. While I do applaud the President's 
proposal to provide a capital gains tax cut for homeowners, his plan is 
really just a small step forward. It is hard to justify the exemption 
of this type of investment gain from other investments, such as the 
individual who chooses to live in a relatively modest home and invest 
in stocks and perhaps the formation of a small manufacturing company. 
Why should those individuals be taxed more harshly than those who 
invest in a personal residence?
  In my view, a general cut in the capital gains tax must be provided 
to encourage savings, and to treat all investors equally. The current 
tax system discourages national savings and investment, which will 
adversely affect our long-term economic growth. Fundamental reform is 
needed to change the system.
  The President's budget includes tax cuts totaling $98.5 billion, with 
most of it going toward the family tax credit, education tax subsidies, 
and expanded IRA's. However, the Clinton budget proposes new tax 
increases targeted at airline passengers, small and large investors, 
and the Nation's job providers totaling some $76 billion. We can do the 
math ourselves: The President's budget leaves a net tax cut of just 
$22.4 billion. I do not believe that is what the American people 
intended when they re-elected the President to a second term.
  Another serious concern lies with the President's proposed new 
entitlement spending. If the President is serious about adding another 
$60 billion in new entitlement spending, he must show us why we need 
new spending programs when we have yet to repair the ones we already 
have.
  Finally, Mr. President, I remain concerned about the economic 
assumptions the White House has relied upon in drafting its plan, which 
are significantly more optimistic than the projections of the 
Congressional Budget Office. The President's budget has not yet been 
scored by the CBO. Once it is, it may very well be $70 billion short of 
our deficit targets.
  President Clinton came here to Capitol Hill just over one year ago 
and stood in the House Chamber to declare that, ``The era of big 
government is over.'' I am afraid that sentiment is not reflected 
within the 2,418 pages of the President's budget. I had hoped for bold 
steps from the President in addressing the very real need to control 
the growth of the Federal Government. But what we received today were 
more like baby steps, the first tentative wobbles of an infant. Under 
the President's budget, Washington will actually spend 3.5 percent more 
in the next fiscal year than we are today. While the President's budget 
appears to reach balance in 2002, more than 60 percent of his deficit 
reduction are slated to come after he has left office. Leaving those 
tough decisions not to the Clinton White House, but the administration 
of the Nation's next Chief Executive.
  Mr. President, I commend the President for the blueprint he has 
prepared for us, and I look forward to working with him and my 
colleagues to improve on and implement these historic changes in our 
Government. In the administration's budget, we have before us a good 
foundation on which to build that bridge to the 21st century the White 
House is so fond of speaking about. But without addressing some of the 
serious concerns I have outlined today, I am afraid that bridge may 
collapse before we are able to cross it.
  Mr. President, I yield the floor.
  Mr. HATCH. Mr. President, I thank the distinguished Senator for his 
remarks in this area.
  The PRESIDING OFFICER. The Chair recognizes the Senator from West 
Virginia.
  Mr. BYRD. Mr. President, I thank the Chair.
  (The remarks of Mr. Byrd pertaining to the introduction of Senate 
Joint Resolution 15 are located in today's Record under ``Statements on 
Introduced Bills and Joint Resolutions.'')
  Mr. DURBIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Illinois is recognized.


                            Amendment No. 2

 (Purpose: To allow waiver of the article in the event of an economic 
                recession or serious economic emergency)

  Mr. DURBIN. I send an amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Illinois (Mr. Durbin) proposes an 
     amendment numbered 2.
       On page 3, between lines 11 and 12, insert the following:
       ``The provisions of this article may be waived for any 
     fiscal year in which there is an economic recession or 
     serious economic emergency in the United States as declared 
     by a joint resolution, adopted by a majority of the whole 
     number of each House, which becomes law.

  Mr. DURBIN. Mr. President, first let me thank the chair of the Senate 
Judiciary Committee for his cooperation in this effort. Though we may 
not see eye to eye on this amendment or the underlying amendment to the 
Constitution, he has been gracious and gentlemanly throughout. I 
appreciate that very much.
  I would also like to salute the Democratic leader from that same 
committee, the ranking member, the Senator from Vermont, for extending 
the same courtesy, both personally and through his staff.

[[Page S1084]]

  This is only the second time that I have taken the floor of the 
Senate to speak. And I consider it a high honor to follow the Senator 
from West Virginia. In the context of constitutional debate, I think we 
are all anxious to learn the views of the Senator from West Virginia 
because he reveres this Constitution, this great document, as much if 
not more than any other Member of the U.S. Senate.
  In the course of the last 14 years I have served in the U.S. House of 
Representatives. I have cast about 7,000 votes. There were many 
important votes among them. The most important vote in my estimation 
was when I was called on to vote and decide whether or not the United 
States would go to war. I knew with that vote and the decision made by 
this Congress that lives would be lost. Husbands, fathers, sons, 
daughters, loved ones would put their lives at risk because of that 
vote. I do not think I cast a more important vote in my congressional 
career.
  But immediately behind that vote I would have to put consideration of 
constitutional amendments. It is so rare that we in this body or in the 
other body have an opportunity to address amending this great 
Constitution that I hope we will all take it with a great deal of 
seriousness. Since 1791, 205 years ago, we have chosen to amend this 
great document only 27 times. Of course, the first 10, the Bill of 
Rights, were in that year, 1791. And each time an amendment has been 
suggested we have tried to step back and measure it against this 
Constitution, this document, and to determine whether or not that 
amendment or that suggestion really ranks with the importance of this 
great document.
  This amendment that we are considering, the balanced budget 
amendment, is one that has been debated at great length. And it has 
been debated by many people of both political parties for a long period 
of time.
  I hope that every Member of the Senate will come to this debate as I 
have with a new energy and a new determination to make certain that 
whatever we do in accepting or rejecting this amendment that it will 
bear the test of history, that those who come after us will judge us as 
having been thoughtful and reflective in determining whether or not 
this amendment belongs in this great document and whether this 
amendment will stand the test of time.
  Mr. President, I do not believe that this balanced budget amendment 
as offered stands the test of time, and that is why I am offering an 
amendment today to address what I consider to be a fundamental flaw in 
the balanced budget amendment.
  Mr. President, the balanced budget amendment that is before us today 
does not provide an adequate means for dealing with economic recessions 
or other serious economic emergencies that could unexpectedly throw the 
budget out of balance or require a fiscal response. It would tip the 
balance against working families and make it harder to help them 
recover from a recession or other economic emergency. In times of 
recession or economic slowdown it would force us to do exactly the 
wrong thing by making it more difficult for the Federal Government to 
respond to adverse economic circumstances. In the case of a regional 
economic downturn, or other economic emergency that fell short of a 
national recession, it would leave us unable to respond unless a 
supermajority of 60 percent or more agree to take action.
  That is why I offer this amendment to allow Congress and the 
President to waive the requirement of a balanced budget in those times 
when our country is experiencing an economic recession or serious 
economic emergency. I do not stand alone with this point of view. More 
than 1,000 of the Nation's most respected economists recently joined 
together to condemn the proposed balanced budget amendment as unsound 
and unnecessary. And here are their words:

       The proposed amendment mandates perverse actions in the 
     face of recessions. In economic downturns, tax revenues fall 
     and some outlays, such as unemployment benefits, rise. These 
     so-called ``built-in stabilizers'' limit declines of after-
     tax income and purchasing power. To keep the budget balanced 
     every year would aggravate recessions.

  The more than 1,000 economists who signed this statement include at 
least 11 Nobel laureates and many present and former Government 
officials, including the former chairman of President Nixon's Council 
of Economic Advisers, current and former Federal Reserve Board 
Chairmen, and former Democrat and Republican Directors of the 
Congressional Budget Office. The group includes a friend of mine and a 
man I respect very much, Robert Eisner, professor at Northwestern 
University in my home State of Illinois who has a solid grasp of the 
economic ramifications of Government budget policies.
  Most Members of this Senate, Democrat or Republican, would concede 
that our economy has moved forward in the last 4 years. Some credit 
fiscal policy emanating from the President and Capitol Hill, and others 
credit monetary policy from the Federal Reserve. I think it has taken 
both efforts to put this economy on the right track.
  During the course of his testimony before our Budget Committee the 
Chairman of the Federal Reserve, Alan Greenspan, was asked point blank 
about the balanced budget amendment. And in the Chairman's words he 
said he was ``opposed to putting detailed economic policy in our 
Constitution.'' This is a man who must on a day-to-day basis sit with 
his staff and cohorts and determine the course of the American economy. 
He is a man who is as dedicated to balancing the budget as any person 
in this Nation. He is someone who has made tough and difficult 
decisions time and again to put this economy on track, and he has 
cautioned us that this is a mistake, a mistake for us to embody in this 
Constitution detailed economic policy, that we forswear the flexibility 
necessary to make certain that this Government of, by, and for the 
people can respond to the needs of the people in times of recession.
  What these economists and Mr. Greenspan are warning us of is that the 
balanced budget amendment if not changed will exacerbate the economic 
slowdowns we experience. It will put our Nation into an economic 
straitjacket that will make it hard to respond to economic downturns.
  Let us talk for a moment about the mechanisms that work in our 
economy in times of recession. Tax receipts fall. Certain types of 
Federal spending increase. Consider the obvious, the plant closes in 
your hometown where workers who have spent a lifetime showing up every 
day doing their job and paying their taxes end up out of work, perhaps 
for the first time in their lives finding themselves drawing 
unemployment compensation from this Federal Government. Perhaps if 
things go badly for a family for a longer period of time, they may be 
called on to apply for food stamps to make sure there is food on the 
table, maybe even Medicaid to make sure there is hospitalization 
protection for members of the family, and then of course trying to find 
another job. They may need to call on the Government for job training 
courses or education to prepare themselves for another career; another 
opportunity.
  What I have just described is not radical. It is a natural outgrowth 
of a free market capitalist economy with business downturns and with 
the vagaries of the business cycle leaving some families and some 
workers needing help.
  The fiscal changes I have described that take place when the 
Government steps in are described as economic stabilizers because they 
kick in automatically in times of unemployment and recession, and they 
help the economy recover, as they help individuals get back on their 
feet. That is why Robert Greenstein from the Center on Budget and 
Policy Priorities described the effect of the balanced budget amendment 
in this way in his testimony before the Judiciary Committee:

       In years when growth is sluggish, revenues rise more slowly 
     while costs for programs like unemployment insurance 
     increase. As a result, the deficit widens. Under a balanced 
     budget amendment, more deficit reduction thus would be 
     required in periods of slow growth than in times of rapid 
     growth.
       This is precisely the opposite--

  The opposite, in his words--

       of what should be done to stabilize the economy and avert 
     recessions. The constitutional amendment consequently risks 
     making recessions more frequent and deeper. In the period 
     from 1930 to 1933, for example, Congress repeatedly cut 
     Federal spending and raised taxes, trying to offset the 
     decline in revenues that occurred after the great crash of 
     1929. Yet those spending cuts and tax increases removed 
     purchasing power

[[Page S1085]]

     from the economy and helped make the downturn deeper; they 
     occurred at exactly the wrong time in the business cycle.

  In Dr. Greenstein's words:

       This is why a balanced budget amendment requirement is 
     called ``pro-cyclical.'' It exacerbates the natural business 
     cycle of growth and recession. It also is why most economists 
     who favor tough deficit reduction measures strongly oppose a 
     constitutional balanced budget amendment.

  Treasury Secretary Robert Rubin gave a similar warning when he 
testified before our Judiciary Committee. He said as follows:

       A balanced budget amendment would subject the Nation to 
     unacceptable economic risks in perpetuity . . . A balanced 
     budget amendment could turn slowdowns into recessions, and 
     recessions into more severe recessions or even depressions.

  Mr. President, this would happen because the so-called automatic 
stabilizers in our economy that have been developed over the past 50 
years to reduce the extremes of the business cycle and help avoid 
another Great Depression would remain inoperative by this proposed 
constitutional amendment.
  I have a chart which I would like to bring up at this point.
  This chart I think demonstrates graphically what I have described: 
What has happened in the business cycles of America from the year 1870 
to 1990.
  You will note that in our free market economy we have our ups and 
downs, but note the changes that took place after World War II. It is 
true that those spikes below the line still occurred, but they were not 
as deep as they had been before. You look back to the Depression, the 
Great Depression of 1929, you see the recession that we faced in the 
mid 1940's, but look at what happened afterwards. We have had our 
downturns, but they have been moderate in comparison.
  These are something more than mere statistics. These reflect 
Americans working and out of work. They reflect businesses being forced 
to shut down. They reflect the misery that families feel when we go 
into an economic downturn.
  Now, what happened at this point that caused such a great change for 
the 40 years reflected? We built into our economy certain ways to 
moderate recessions. Those moderations or stabilizers are Government 
programs involving Government expenditures. When our economy goes into 
a downturn, tax receipts are diminished, the opportunity to balance the 
budget is made more difficult, and we are called on at the same time to 
respond and spend.
  So as tax revenues are going down, calls for expenditures to 
stabilize the economy go up. That is a recipe for an unbalanced budget. 
But it is also a recipe for stabilizing an economy, for ending a 
recession, for bringing people back to work, for giving small 
businesses a chance to survive, to say to family farmers it was a bad 
year but next year can be better; we are going to help you through 
this.

  If we accept what this balanced budget amendment offers, it will 
become increasingly difficult for us to use the stabilizers that have 
kept America at work, have kept families together, have kept small 
businesses in business and family farmers on the farm.
  That is what is at stake in this debate. The reason I have offered 
this amendment is to suggest that there is a more reasonable way to 
approach this. If those who support the balanced budget amendment want 
to make certain that this Congress goes on the record to make certain 
that we go on the record with a record vote and be held accountable 
when we do not balance the budget, my amendment requires that as well, 
but it does not require a supermajority.
  In response to the claim by some that Congress could still easily 
respond to economic recessions with the balanced budget amendment, 
Secretary Rubin added the following comments:

       You recognize recessions quite a bit after they have 
     started. Predicting economic circumstances is well nigh 
     impossible, in my judgment, at least with any degree of 
     reliability. And under those circumstances you can be well 
     into an economic downturn before you realize you have to deal 
     with it, and--

  In Secretary Rubin's words--

       I think that is one of the very serious problems that the 
     balanced budget amendment creates.

  Why does it take time for us to recognize these recessions? The 
general working definition of a recession is that it is at least two 
consecutive quarters--a quarter being a 3-month period of time--of 
decline in real gross domestic product. It obviously takes 6 months to 
trigger this definition. So sometimes we have started into a recession 
moving below the line here, unemployment starting to show up and we do 
not see it. It is hidden to us until 3 months or 6 months later.
  The more technical definition of recession also includes inherent 
lags. We have found that the decline in economic activity associated 
with a recession is not always widespread. Oftentimes it is confined to 
a sector of the economy or region of the country. We also find that 
sometimes these declines are cumulative in nature, not restricted to 
just 1 month or 1 quarter. Again, it takes time to measure these 
criteria.
  So, as a general principle, what Secretary Rubin has said to us is we 
may not know we need to help until we are in the middle of our problem. 
There is a lag time, to accumulate and analyze data and recognize the 
decline that may have already started.
  So how often do we face these recessions? Are they rare occurrences 
in the American economy? We have been blessed in recent years, but 
historically recessions occur very frequently. By the National Bureau 
of Economic Research's official determination, our Nation has 
experienced 9 recessions since World War II, 11 since the Great 
Depression of 1929 to 1933, and 21 recessions this century, which means 
that roughly every 5 years we will face this recession.
  The balanced budget amendment does not assume that this is going to 
happen. It assumes it will not happen. And if Congress is going to 
respond to this occurrence, which we know has been fairly regular, it 
requires a supermajority for us to spend the money to stabilize the 
economy.
  In part because of the economic stabilizers that are now part of our 
economy, the average length of recession since World War II has only 
been 11 months compared to 18 months in the previous half century.
  A recession is not just an abstract economic concept. It is lost 
jobs, lost wages, personal and family financial crises.
  The Federal Government has developed many mechanisms to deal with it. 
I have mentioned a few: Unemployment compensation, Medicaid 
applications, food stamps and so forth.
  Let me tell you a story that I think illustrates this as well as any 
that I could tell you on the floor of the Senate. In my hometown of 
Springfield, IL, we were blessed for decades with manufacturing plants 
which created good jobs, good-paying jobs for men and women who would 
come to work with a strong back, a good work ethic, and usually little 
more than a high school diploma. One of those plants was known as the 
Fiat-Allis plant. It was a plant organized by the United Auto Workers, 
producing heavy equipment and producing great jobs for a lot of 
families and a great boost to the Springfield economy.
  Over a decade ago that plant closed, and hundreds of workers who had 
relied on this plant were thrown out on the street. You can repeat the 
example and story I am about to describe in virtually every city in 
America. This happens all too frequently. Let me tell you about one 
friend of mine who had worked at Fiat-Allis for years. His name is Bob 
Bergen.
  Bob saw it coming. He had heard a lot of talk about the plant closing 
down. So Bob decided that he would do something about it. He went to 
the community college before the plant closed down and started taking 
courses in heating and cooling, thinking about opening his own 
business, furnaces and air conditioners and the like. So, when the 
plant did close down, Bob had a short transition, but one that he 
planned, drawing some unemployment, some trade adjustment assistance, 
finishing up his course work at Lincoln Land Community College, and 
ultimately opening his own business.
  It worked. Our investment in Bob Bergen and his family paid off. We 
cushioned the shock of unemployment. We gave Bob an avenue to follow 
toward a new course of livelihood, and he took it. Now he is in 
business. In fact, he put the furnace in my home just a few years ago 
and does a pretty good

[[Page S1086]]

job now, and I am glad to call him a friend. His life and experience 
are illustrations of what I am talking about.
  Imagine a recession closing down plants across this country and 
imagine this Congress, faced with the need to balance the budget to the 
dollar, being unable to provide unemployment compensation that Bob 
Bergen needed; being unable to provide the trade adjustment assistance 
that Bob Bergen used to keep his family together while he got his 
business started; being unable to provide job training, the scholarship 
assistance at community college, the things which people rely on in 
America to get back on track. If we are hidebound, tied to the 
provisions of this balanced budget amendment, and forget the Bob 
Bergens of the world and what it means to them, I think we have lost 
sight of our responsibility.
  How much of a difference do these economic stabilizers make to our 
economy? Secretary Rubin testified, if you want to look at this in a 
larger context, ``Without automatic stabilizers, the Treasury 
Department has estimated that unemployment in 1992 that resulted from 
the 1990 recession might have hit 9 percent instead of 7.7 percent.'' 
Statistics aside, Secretary Rubin tells us that would have meant 1 
million more Americans out of work. We would have had 1 million more 
unemployed Americans, 1 million more families pushed to the economic 
precipice if our economic stabilizers had not been there.
  These recessions also tend to be regional in nature. Proponents of 
the underlying balanced budget amendment argue that it contains an 
escape hatch that allows a waiver of its provisions by a supermajority 
vote of three-fifths of both Houses of Congress. But mustering a three-
fifths vote is not always an easy matter. Millions of working families 
in America might have to suffer if we cannot come up with 60 percent on 
a vote to waive the balanced budget requirements in times of recession.
  I recall, and I think most do as well, what happened not that long 
ago, in fact, just 2 years ago, when we were called upon in Congress to 
pass a debt limit, a debt limit which said we put our full faith and 
credit as a government behind the debt of the United States. It took 
only a majority vote to do that, and we could not bring it together. As 
a consequence, we faced some of the most serious shutdowns in our 
Nation's history. The Government shutdowns that occurred, two 
successive shutdowns, literally sent thousands of Federal workers off 
the job. The Government shut down not once but twice, a total of 27 
days. The Office of Management and Budget has estimated that the 
overall cost of the shutdowns was more than $1.4 billion. America knew 
it. More than 750,000 Federal workers were affected, some during the 
Christmas and Hanukkah season, including more than 250,000 who were 
furloughed.

  During that period of the Government shutdown, 170,000 veterans did 
not receive their GI bill education benefits on time, 200,000 passports 
were not processed, more than 2 million people could not visit the 
Smithsonian museums and other facilities in the Washington area, and 7 
million people could not visit their national parks. Mr. President, 
1,300 workplace safety complaints went unanswered and 3,500 
investigations involving pension, health, and other employee benefit 
plans were suspended. Delays were created in 250,000 cases trying to 
find deadbeat dads who were delinquent in their child support payments, 
and cleanup of hundreds of Superfund sites was delayed. All of this 
happened because we could not muster a majority, a majority vote, let 
alone a supermajority.
  This balanced budget amendment will enshrine in our Constitution the 
requirement of a three-fifths vote in times of an economic recession to 
come to the rescue of American families. For those who think this is an 
easy requirement, it is rare in our Constitution to have any 
supermajority requirement and it certainly should not be imposed on 
people who, through no fault of their own, are victims of this economy.
  My amendment brings the supermajority requirement of three-fifths 
down to a majority requirement. I think that is reasonable. It is still 
not going to be easy. Each and every person, whether a Member of the 
House or the Senate, must stand and justify that vote in terms of a 
recession, a national economic emergency, something that justifies 
slipping away from the balanced budget requirement that year.
  I think we have to maintain flexibility to respond to recessions, 
disasters, and other economic emergencies in a timely fashion. I do not 
think we have to say, ``I'm sorry, Mr. Bergen, I am sorry you have been 
laid off, but because of the balanced budget amendment, we are not 
going to be able to make the payments to you for your unemployment 
because we just have to balance the budget. We cannot help you when it 
comes to food stamps, we have run out of money. We cannot help your 
family when it comes to job training or Medicaid.''
  Think about that for a second. Is that fair to people we represent? 
Is that fair to this economy? Will it, in fact, result in these spikes 
going lower instead of moderating, as we have seen, as these 
stabilizers have been put in place? That, unfortunately, might be the 
verdict for Bob Bergen and others like him if this supermajority 
requirement allows 41 Senators or 175 Representatives to prevent a 
response that involves deficit spending.
  Our Founding Fathers established only a few circumstances where 
supermajorities would be necessary for Federal action. We should not 
adopt a new supermajority requirement that prevents us from helping our 
most vulnerable and neediest citizens in times of recession or other 
serious economic emergencies.
  For all these reasons, I am offering an amendment to allow Congress 
to waive the requirements of the balanced budget amendment by a 
majority vote for a joint resolution in times of recession or serious 
economic emergency. My amendment will ensure that Congress can continue 
to respond to recessions and other serious economic emergencies with 
fiscal policies that will alleviate the pain of recession and shorten 
its duration rather than driving us deeper into economic stagnation.
  I urge my colleagues to support this amendment.
  The PRESIDING OFFICER. The Senator from Arkansas is recognized.
  Mr. HUTCHINSON. Mr. President, I rise in support of the balanced 
budget amendment. I think it is one of the most important pieces of 
legislation we will be debating in this body, in this Congress. I might 
add, I appreciate the preceding Senator, Senator Durbin, acknowledging, 
as he presented his amendment to the balanced budget amendment, his 
overall opposition to the underlying amendment to the Constitution. We 
are going to, I suspect, hear many amendments--several amendments at 
least--offered in the coming weeks, with the primary goal of ultimately 
defeating the balanced budget amendment to the Constitution.

  As I said, I believe this is one of the most important pieces of 
legislation we are going to debate. The opponents of a balanced budget 
amendment argue that to compel Congress to balance the budget will 
forever damage and eliminate the ability to provide our seniors with 
the protection they have earned. Their plan--and we will be hearing 
more of it; we have already heard quite a lot--to exempt Social 
Security is nothing more than a risky gimmick. I say again it is a 
risky gimmick to put such an exclusion onto the balanced budget 
amendment. Their arguments are aimed at scaring the most vulnerable 
segments of our population.
  In the last 2 years, in my experience in the House of Representatives 
and as I observe the deliberations in the U.S. Senate, we have seen a 
great deal of those efforts to scare those who are most vulnerable in 
our society. So I suppose it is not that unusual, as we enter a debate 
on the balanced budget amendment to the Constitution, to hear those who 
would frighten and those who would scare the most vulnerable in our 
society. They assert Social Security checks will be withheld because 
there will be no money left in the Treasury.
  Mr. President, I ask unanimous consent that an editorial from the 
Arkansas Democrat Gazette be printed in the Record.
  There being no objection, the editorial was ordered to be printed in 
the Record, as follows:

[[Page S1087]]

           [From the Arkansas Democrat Gazette, Feb. 5, 1997]

                   Budgetscare: How To Debase a Cause

       Bill Clinton doubtless wants to defeat the Balanced Budget 
     amendment in the worst way which is just how he's going about 
     it--by scaring old folks again. Yep, once more he's saying a 
     proposed reform will put Social Security--Social Security!--
     at ``grave risk.''
       Now when have we heard that before? Only every time 
     somebody tries to get the federal government to put its 
     fiscal house in order. By now the clintonoids have made this 
     simple scare campaign a fine art First, scare the seniors; 
     then scare `em some more; then leave 'em petrified. And 
     never, ever let the facts get in the way.
       Despite its name, the Balanced Budget amendment would not 
     keep Congress from passing an unbalanced budget. Instead, it 
     just puts a slightly larger hurdle in the way. It would 
     require a three-fifths vote of both houses of Congress to run 
     a deficit. It's not an insuperable obstacle; most 
     controversial business in the Senate already required a 
     three-fifths vote--because that's what it takes to prevent a 
     filibuster.
       But here comes the president, warning that ``disbursement 
     of Social Security checks could cease or unelected judges 
     could reduce benefits to comply with this constitutional 
     amendment.''
       Not very likely. Not very likely at all. The chances of 
     Social Security checks being sequestered fall into the same 
     range of probability as the Loch Ness monster posing for 
     photographs. Both possibilities are great for scaring folks, 
     but for little else.
       Social Security is an entitlement written into law, it is 
     not dependent on annual appropriations by Congress. It's 
     recipients paid into the program, they're entitled to their 
     checks--even if Congress doesn't approve a budget. It's 
     automatic.
       The federal government would have to go broke before one of 
     those unelected judges the president uses as a bogeyman would 
     have to decide what creditors got paid first. And recipients 
     of Social Security would stand at the head of the line 
     because their benefits are part of a separate law. Behind 
     them would come all of the programs that are covered by 
     annual appropriations--everything from education to the 
     federal courts, from the Smithsonian to the space shuttle, 
     and the multitude of grants for essentials like battery-
     operated grocery carts and solar powered cars.
       All told, spending for these appropriated programs amounts 
     to five times the size of last year's deficit, meaning that 
     the government's default would have to be of Depression-
     sized proportions before Social Security might be 
     threatened. And even then such a dramatic catastrophe 
     isn't likely. Because this amendment has more escape 
     hatches than an old-time movie serial.
       The president knows the process. He has to know that Social 
     Security isn't in the imminent danger he's conjured up. Once 
     again he is playing to the darkest fears of the most 
     vulnerable citizens in order to achieve a partisan end. Why, 
     with all the arguments available to him, is Bill Clinton 
     invariably attracted to the lowest common one? Some days it's 
     as if he'll do anything but raise the level of public 
     discourse.
       A mere citizen can still yearn for a leader who, acting on 
     principle, takes an unpopular stand without resorting to 
     demagoguery. To make his case, such a leader would not paint 
     a doomsday scenario of little old ladies starving in the 
     cold, but would rely on reason supported by fact and informed 
     by sober judgment.
       About that misnamed Balanced Budget Amendment, he would say 
     it would unnecessarily clutter the Constitution we all 
     revere. He would explain that such an amendment would create 
     an even more unwieldy process in a Congress already prone to 
     procedural knots. Perhaps he would contend that the proposal 
     for a super-majority is undemocratic. Or he could argue that 
     while America is not a strict democracy, its citizens are 
     loathe to depart from majority rule without a pretty darned 
     good reason.
       But these are all arguments that, unlike the usual scare 
     tactics, would have to be patiently explained in order to 
     carry the day. They would compliment the intelligence of the 
     American people, not insult it. It's so much easier to 
     proclaim that Social Security and the sky are falling. So, 
     once again, William Jefferson Clinton has chosen to frighten 
     any older citizens he can.
       The result: Our president and head of state, an official 
     who should be most responsible of all, introduces still more 
     mistrust into a political system already overburdened with 
     it. He encourages suspicion and cynicism--always corrosive 
     agents in a system that relies on consent and understanding. 
     In doing so, he tears at the fabric of the very constitution 
     he claims to be defending.

  Mr. HUTCHINSON. Mr. President, a part of that editorial says this:

       The chances of Social Security checks being sequestered 
     fall into the same range of probability as the Loch Ness 
     monster posing for photographs. Both possibilities are great 
     for scaring folks, but for little else.

  I believe that is very, very true. Again, nothing could be a more 
risky gimmick to be put onto the balanced budget amendment than to 
exclude Social Security from the provisions of the amendment. It is 
attempting to replace the truth with fear.
  The plain truth is that the President does not have the power to 
withhold appropriations, such as Social Security. Only Congress can 
give him that power. It is our responsibility to appropriate the funds 
necessary to carry out the domestic and the foreign policy programs of 
this Nation. In reality, the balanced budget amendment will ensure that 
money is there to spend.
  Today, annual deficits and the national debt are the greatest threat 
to Social Security's existence. If we talk about the threat to the 
future of Social Security, let us not forget that the greatest threat 
is continued chronic deficits and an unwillingness or a lack of 
discipline and a lack of will on the part of the politicians of this 
country to bring our books into balance.
  I believe this very vivid depiction of having 28 budget books stacked 
on top of each other is very clear evidence that the notion--as the 
President put it in the State of the Union Address--that we can just do 
it, we pass it and he will sign it, we will balance the books, will not 
happen, as we see with 28 budgets before us. It has to stretch the 
credibility of not only the executive branch but a Congress that is 
more inclined to continue spending on ever-expanding entitlement 
programs.
  Since the 1930's, literally dozens of proposals have been made to 
require a balanced budget to limit the size or the growth of the 
Federal budget or public debt, or some combination of these ideas, 
including several very notable recent efforts in 1990 and, again, in 
1993. These have come in the form of bills, statutory efforts, and 
proposed constitutional amendments. An average, Mr. President, of more 
than 30 measures per Congress have been introduced in recent years.
  I believe one reason that we have seen such statutory efforts and so 
many offers of various constitutional amendments is because many of 
those who occupy the Halls of Congress today, both at the other end of 
the Capitol in the House of Representatives and in the U.S. Senate, 
once served in State legislatures where they have the yearly annual 
experience of seeing their State budgets balanced. They came from State 
legislatures where there were constitutional provisions that required 
them to balance their budget, and they saw year after year after year 
that it could be done.
  So when they came to Washington, they came with a determination, they 
came with a deliberation that we would have, in fact, that same 
provision embodied in the U.S. Constitution. But it has been 
frustrating. Year after year and time after time, we have seen those 
efforts defeated.
  The opponents of a balanced budget amendment, I believe, are pursuing 
a campaign of deliberate disinformation. There has been and will 
continue to be an effort to distract and to divert the attention of the 
American people from the real issues that are at stake in the debate 
over a balanced budget and over a balanced budget amendment. The 
opponents would distract and divert the American people from the real 
threat to Social Security, which is chronic deficits and enormous 
accumulated debt. They would like the debate over the coming weeks to 
be about Social Security, but the debate is not about Social Security. 
The debate is about the chronic deficits that threaten the future 
economic stability of this Government and our economy in years to come. 
That's what it is about.
  If you care about Social Security, you should care about a balanced 
budget amendment to the Constitution, because that is the best way of 
ensuring fiscal sanity being restored to our budget process. Without a 
credible, sustainable balanced budget, we will never have the money to 
pay out future benefits. It is just that simple. A balanced budget 
amendment needs economic prosperity that will produce revenues 
necessary to fund the program. With a balanced budget, the big spenders 
in Washington will not be able to target and, therefore, raid Social 
Security to pay for other programs.
  Opponents of the balanced budget amendment will throw out, I think, 
any diversion to confuse the issue. They will use scare tactics. The 
truth is that excluding Social Security does nothing to secure benefits 
into the future. The President's own budget counts these surpluses to 
achieve his balance.
  What if Social Security is excluded? Social Security will not be 
protected,

[[Page S1088]]

but between the years of 2002 and 2007, the deficit will appear $700 
billion larger. That means either a mammoth tax hike on American 
families, almost $1,100 per year per household, or devastating cuts in 
important programs like Medicare, cancer research, Head Start, and 
environmental cleanup.
  In the years since 1960, the budget has been balanced only once. 
Deficit spending during that period has increased the official national 
debt from less than $284 billion to over $5 trillion, and the 28 budget 
books that are stacked right over here give vivid evidence of that 
failure of Congress to discipline its spending habits.

  Interest payments on the debt now consume about $240 billion 
annually; $240 billion annually just on interest to service the 
national debt. The $240 billion that we are spending in interest 
payments is larger than the combined budgets of the Departments of 
Commerce, Agriculture, Education, Energy, Justice, Interior, Housing 
and Urban Development, Labor, State, and Transportation.
  I suggest that if we have a commitment to education, then we ought to 
have a commitment to a balanced budget amendment to the Constitution to 
ensure that these exploding interest payments will finally be reined 
in. In the future, the debt problem will only get worse. The 
Government's current debt calculation fails to include the 10 to 20 
trillion dollars worth of unfunded liabilities. These are promises to 
pay future benefits like Social Security, Medicare, Government employee 
retirement and other programs. In short, we will soon long for the days 
of $200 billion deficits unless something is done, and that something 
should be the balanced budget amendment.
  When you exclude Social Security, you derail the very purpose of the 
amendment. I was interested, as I listened to the deliberations of the 
House Judiciary Committee earlier this week on the balanced budget 
amendment, in the testimony of a former Congressman, my former 
colleague, Tim Penny. He referred to this gimmick of taking Social 
Security off budget and out of the unified budget as being the greatest 
money-laundering scheme in history, because future creative Congresses 
will find it not too difficult to begin to shift programs into the 
Social Security trust fund so as to circumvent the purpose and the goal 
and the intent of a balanced budget amendment to the Constitution. It 
is a loophole so large, not only can a truck drive through it, but tons 
and tons of red ink can flow through it.
  Finally, the goal of such an amendment is to defeat the balanced 
budget amendment to the Constitution.
  As I said, I am glad that Senator Durbin acknowledged his underlying 
opposition to an amendment to the Constitution requiring a balanced 
budget altogether. So while he offers this amendment to the BBA, he 
still opposes the concept of an amendment requiring a balanced budget.
  Secretary Rubin--who was quoted earlier this afternoon--Secretary 
Rubin, when he testified before the House Judiciary Committee, was 
asked by my brother, Congressman Hutchinson, whether there was any 
balanced budget amendment that he could envision that he would be able 
to support? In other words, if you went ahead and excluded Social 
Security, or if you put in a recession provision, or if there were some 
other addition to a balanced budget amendment, was there any such 
amendment that Secretary Rubin or the administration could support? And 
when finally pressed, Secretary Rubin said no. He said he could not 
envision any amendment to the Constitution requiring a balanced budget 
in any form that the administration would support.
  I think that really tells the story, that while there will be efforts 
to divert attention, while there will be efforts to distract the 
attention of the American people, all of the amendments that are 
offered are in the end ultimately being offered with the goal of 
defeating this very, very important amendment to the Constitution.
  I want to put a human face on the balanced budget amendment. We can 
often become too consumed with who has political advantage in policy 
debates that we forget who sent us here and how it often affects them. 
Let me tell you about one of my constituents. Bob Boyd, a small 
business owner in Little Rock, is the kind of person who can speak to 
the importance, I think, of a balanced budget amendment to the 
Constitution.
  Mr. Boyd was a delegate to the White House Conference on Small 
Business. During that time, he and the conference made several 
recommendations to President Clinton. The one proposal which received 
the most votes, more than any other policy recommendation by the White 
House Conference on Small Business, was for the adoption of a balanced 
budget amendment to the Constitution. Unfortunately, that proposal has 
only collected dust at the White House. But this was from the White 
House Conference on Small Business, the recommendation that received 
the most support.
  When asked why so many of the conference voted on this proposal and 
voted for this proposal, Bob simply says:

       . . . as a small business owner, we know the importance of 
     the bottom line and [the] government doesn't, they have lost 
     the principle of being responsible for their debts.

  Bob said that the President told them ``that small business is the 
engine that drives our economy.'' Unfortunately for Bob, and for all 
the small businesses in Arkansas and America, the national debt, and 
the taxes it needs to pay for it, are taking up all the fuel.
  I strongly believe that ratification of a constitutional amendment is 
the only way to turn around this unending sea of financial debt. It is 
time to put the harness of the U.S. Constitution on Congress and the 
President. It is time to require these institutions to be more fiscally 
responsible than our predecessors have been.
  I would just say again, as I conclude, Mr. President, that there is a 
fundamental immorality that goes along with chronic deficit spending. 
For decades and for generations of our history as a Nation, a 
constitutional amendment requiring a balanced budget was not necessary 
because there was an inherent fundamental belief on the part not only 
of our policymakers and our politicians but the people of the United 
States as a whole that spending more than you take in, whether it is 
your family budget or whether it is the Federal budget, is simply 
wrong. To transfer our spending in the form of debt to our children and 
to our grandchildren, for them to assume through higher taxes and 
through a lower standard of living, is simply wrong.
  The intrinsic value, though, of the balanced budget amendment rests 
on a simple point--it affects every American. It will affect how and 
where we spend taxpayers' dollars. It will affect the process by which 
those decisions are made. Moreover, it will affect the real value we 
place on the taxpayers' money, when we are restricted in the ways we 
spend it.

  The time has come for Government to learn how to work with less, how 
to see the citizen's money as being precious, and to permanently reduce 
its size so that its people's wealth can expand. I yield the floor, Mr. 
President.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER (Mr. Abraham). The Senator from Utah.
  Mr. HATCH. Mr. President, I just want to take a second here and thank 
the distinguished Senator from Arkansas for his remarks that he has 
made. I do not know when I have been more impressed with a group of new 
Senators than I have now, unless it was the last time when we brought 
the balanced budget amendment up and lost by one vote, when all of the 
new Senators spoke together on the last one. I was just really 
impressed with that. And these Senators this year have been doing very 
well. I appreciate the Senator coming to the floor and making these 
cogent remarks. I thank my colleague.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, while the Senator from Arkansas is still on 
the floor--and while I indicate a different view than his on the 
amendment, I, too, join the chairman in complimenting him and the other 
new Senators who have spoken. When you think back to what your first 
speech was, it is nice to know it was on a major issue. So I compliment 
him for that.
  Mr. President, I would note though that it is an important issue. 
That is why we should take it as serious as possible. We talked about 
amendments.
  Senator Durbin, the distinguished Senator from Illinois, has also 
spoken,

[[Page S1089]]

in one of his first speeches on the floor of the Senate, as eloquently 
and as completely and as logically and cogently as he used to speak in 
the other body. The Senator from Illinois has spoken of an amendment 
that he has offered. While we will not vote on it today, we will 
eventually vote on it to the balanced budget amendment. He also 
expressed his concern about the underlying amendment.
  There is nothing inconsistent with saying that one does not want to 
amend the Constitution of the United States on this issue but will 
propose an amendment to the constitutional amendment as presented by 
the distinguished Senator from Utah and others. I think there is 
nothing inconsistent with this because all of us have a responsibility, 
however we vote, to try to make what is the final product as good as 
possible.
  All Senators know that there are issues that come to this floor where 
we may have made up our mind how we would vote on the underlying piece 
of legislation, either for or against it, but yet we will be involved 
in numerous amendments before we get there.
  I have voted against amendments on a bill when I finally voted for 
the final bill and vice versa. I have had legislation of my own that I 
have sponsored and have then supported amendments to my own 
legislation, amendments offered either by myself or other Senators. I 
have supported amendments to my own legislation offered by Senators 
from the other side of the aisle on major pieces of legislation on 
numerous occasions because while I thought I had brought a good piece 
of legislation to the floor of the Senate, other Senators brought up 
amendments that I realized, in listening to the debate, made that 
legislation even better.
  I can think of various times during the years when I was chairman of 
the Senate Agriculture Committee, when I would have a farm bill, a 
major piece of nutrition legislation, and others on the floor--
legislation that I had been the principal author of--and Senators on 
both sides of the aisle, both Republicans and Democrats, had come up 
with amendments which, after listening to them, I felt that they made 
the underlying piece of legislation better and voted for them.
  I can think of a couple instances when I have had legislation on the 
floor where Senators have been very candid and told me they would not 
vote for my piece of legislation, but on the possibility it might pass 
they had an amendment which at least in their thought would make it 
better. It is a very legitimate thing to do. We debated those 
amendments. Some were accepted, some were not.
  The underlying amendment, the underlying proposed constitutional 
amendment, is unsound economic policy and should be rejected for that 
reason. But you also go on the assumption that any piece of legislation 
may pass. It is the responsibility of each of us to offer suggestions, 
if we have them, of how it may be improved. Senator Durbin's amendment 
to waive this article in the event of an economic recession or serious 
economic emergency is right on point, and it does improve the 
legislation.

  One should listen in that regard to the economic experts. More than 
1,000 of the Nation's most respected economists, including at least 11 
Nobel laureates, as well as a former chair of President Nixon's Council 
of Economic Advisers, the current and former Federal Reserve Board 
Chairman, former Democrat and Republican Directors of the Congressional 
Budget Office, all agree this amendment is unsound economic policy.
  The distinguished senior Senator from the State of West Virginia [Mr. 
Byrd] held a news conference in which he released the signatures of 
more than 1,000 economists and had a number of economists, Professor 
Tobin and others, who pointed out why they felt this proposed 
constitutional amendment was bad economic policy. These economists, 
incidentally, were across the political spectrum. They all agreed that 
the proposed amendment would hamper the Government's ability to cope 
with economic downturns.
  Economists and financial experts agree that this proposed balanced 
budget constitutional amendment will straitjacket the economy in hard 
times. It will hamstring the adjustment mechanisms that have been 
developed since the Great Depression to preserve jobs and restore the 
economy after a downturn.
  Being opposed to the constitutional amendment is an entirely 
different thing than being opposed to a balanced budget. This Congress, 
under very strong leadership from President Clinton, has brought the 
deficit down 4 years in a row and is now going to go for the fifth year 
in a row. Certainly since I have been old enough to vote, no President, 
Republican or Democrat, has done that before. The deficit is coming 
down.
  Were it not for the fact that we were now paying almost half billion 
dollars a day in interest on the deficits run up in President Reagan 
and Bush's budgets, we would not even have a deficit today. We would 
have a surplus, and we could start applying that surplus to the 
national debt.
  I urge Senators to understand that people like the Senator from 
Vermont and others who have cast very, very difficult votes, 
politically unpopular votes to cut programs, to cut spending, to bring 
down the deficit, do not need to be shown a constitutional amendment 
that some day in the next century, the next millennium, it might have 
some effect. We can vote right now. As President Clinton said in his 
State of the Union Message, all it takes is our vote and his signature 
to bring down any deficit. We can do it now rather than saying, well, 
sometime in the next millennium, the year 2000-something, maybe there 
will be this untried amendment to the Constitution, only the 18th 
amendment to the Constitution since the Bill of Rights. Instead, we 
should have the courage to vote to bring the deficit down now.
  Some of us in this Congress and the House and Senate have had the 
courage for 4 years in a row to cast those votes to bring down the 
deficit. I wish we were not paying that half billion dollars a day in 
interest from the doubling and tripling of the national debt during the 
1980's. But to President Clinton's credit and the credit of those men 
and women who have voted with him to bring down the deficit, it is 
coming down.
  Let us think about the flexibility you do need in difficult times. 
President Herbert Hoover, who was a great engineer and had many 
wonderful characteristics, but not a sense of the economy, felt during 
an early recession in his term that the most important thing he could 
do to bring about some confidence in this country was to take whatever 
steps necessary to have a balanced budget--basically taking the steps 
that would be required by this constitutional amendment. By doing that, 
it plunged this country into the worst depression it has known in its 
200-year history.
  If the economy today takes a downturn and Americans are losing their 
jobs as happened in the early 1990's, then this proposed constitutional 
amendment makes it more difficult for our Government to respond to the 
needs of working families.

  As Treasury Secretary Rubin, a man who has proven by his own life 
that he understands the economy and economics, testified before the 
Judiciary Committee--and, incidentally, without any expert refuting 
what he said--Secretary Rubin said he thought ``a balanced budget 
amendment would subject the Nation to unacceptable economic risk in 
perpetuity. * * * A balanced budget amendment could turn slowdowns into 
recessions and recessions into more severe recessions or even 
depressions.''
  To date, no competent, recognized expert has come forward and refuted 
what Secretary Rubin said. Thus, the 1,060 economists and 11 Nobel 
laureates who are opposing the proposed constitutional amendment 
condemn it because the amendment ``mandates perverse actions in the 
face of recessions.''
  I am deeply concerned about the impact the balanced budget amendment 
will have on jobs for working families in Vermont and across the 
country during times of recession. If I put a human face on it, I put a 
human face of 560,000 Vermonters. We are a fiscally conservative State. 
We find when we sell bonds from Vermont, they sell out virtually 
immediately because people know how we feel about keeping our books. We 
do not have a constitutional amendment to balance the budget in the 
Vermont State Constitution. What

[[Page S1090]]

we have are 180 Vermont legislators who treat every tax dollar as 
though it were their own. Governors, Republicans and Democrats, felt 
the same, who realized, however, at such time as Vermont, a small 
State, has gone into a recession, there are times it has had to spend 
some money to help us out of it as a responsibility to the people of 
Vermont.
  I hate to think what might happen if we go into a deep recession and 
people are being laid off from jobs and are told, ``Well, we cannot 
help out.'' There are none of the programs we normally see to ease 
recessions and get our economy going again. I realize it is 25 below 
zero in Vermont. I realize you have just been laid off from a job you 
have had for 15 years, but the various Federal programs that we started 
after the Great Depression cannot be funded.
  As Secretary Rubin explained, the so-called automatic stabilizers in 
our economy would be ineffective under this proposed constitutional 
amendment. These are mechanisms that have been developed over the last 
50 years to reduce the extremes of the boom-and-bust cycles. They are 
intended to prevent another Great Depression. They have proven 
effective over time.
  Secretary Rubin testified:

       ``[W]ithout automatic stabilizers, the Treasury Department 
     has estimated unemployment in 1992 that resulted from the 
     1990 recession might have hit 9 percent instead of 7.7 
     percent, which would have been in excess of 1 million jobs 
     lost.''

  Some of these things that helped, when I think about 1988 and 1992, 
we were adding around 40,000 people a week to the food stamp rolls to 
help bring us back. In the last 4 years, we have been taking millions 
back off the food stamp rolls. It shows it can work.
  The preamble to the Constitution and its stated purpose to ``promote 
the general welfare, and secure the blessings of liberty to ourselves 
and our posterity,'' ought not be overridden by a constitutional 
amendment that denies jobs to hundreds of thousands of working families 
in hard times.
  People talk about the Federal Reserve Board. Federal Reserve Chairman 
Alan Greenspan reiterated his opposition to the proposed constitutional 
amendment during questioning by Senator Lautenberg during his testimony 
before the Senate Budget Committee. Federal Reserve Chairman Greenspan 
urged the Senate Budget Committee to continue to eliminate the deficit. 
He did join Secretary Rubin and our Nation's leading economists in the 
conclusion that this proposed constitutional amendment places too many 
constraints on our economy.
  This so-called escape hatch allowing a waiver of its provisions by a 
supermajority vote of three-fifths of both Houses of Congress is small 
comfort to America's working families, because many national recessions 
start out in different regions of the country. For example, the most 
recent recession hit New England first.
  What if citizens of New England, who have fewer Members of the House 
of Representatives than other regions of the country, needed help? Or, 
conversely, what if a very populous region of the country suddenly had 
a recession? Do they become the only ones who can get help? Could New 
England get Senators and Representatives from other States, which are 
still experiencing good times, to waive the constitutional balanced 
budget requirement to help protect their livelihoods?
  Prof. Robert Eisner of Northwestern University, a past president of 
the American Economic Association, understood the economic problems 
under this proposed constitutional amendment when he wrote:

       One need only recall the near collapses, in recent years, 
     of the economies in New England, California, and Texas. Who 
     would bail them out if their own tax revenues again decline 
     and there were surges of claims for unemployment benefits, 
     food stamps, and general assistance?

  One of the reasons for having this great Nation of 50 States is so 
that we can work together to help each other, knowing that if a tornado 
hits one part of the country and not others, or a recession hits one 
region and not others, relief would be available. Relief for economic 
recessions and emergencies has to be flexible. None of us can predict, 
and certainly cannot write into a constitutional amendment, when the 
next natural disaster will hit or the next recession will take place, 
because usually a swift response from the Federal Government is needed 
to aid State and local relief efforts. Economic emergency relief by 
constitutional supermajority mandate is a prescription for gridlock, 
not swift action.
  It would make no sense--if there is a terrible earthquake in 
California, or awful flooding in the Midwest, or a drought in the 
Southeast, or a recession in New England--to say we can't do anything 
to help because we need a supermajority vote.
  When your State or region is hit by a major recession or emergency, 
do you want critical Federal assistance to hang on the whims of 41 
Senators or 175 Representatives? That is all it would take. We have 535 
Members of Congress. All 535 Members of those bodies--save a critical 
41--could vote and you may not be helped.
  Our Founders rejected this requirement of supermajorities. We should 
look to their sound reasons for rejecting supermajority requirements 
before we impose on our most vulnerable citizens a three-fifths 
supermajority requirement to provide Federal relief from recessions and 
serious economic emergencies.
  In fact, I urge some to go back and read ``The Federalist Papers,'' 
read what our Founders wrote. I hope that all Senators have read them. 
But if they haven't, now is as good a time as any to add to your 
education, improve your mind, and acquire a sense of history. It is why 
Senators, for 200 years, have resisted the temptation to amend the 
Constitution unnecessarily--17 times since the Bill of Rights, that's 
all. Surely, we have had more than 17 times in this country when we 
have had the urge to do it, when it has been politically popular to do 
it, when we could point to political polls of the moment that said 70 
percent of the country wanted us to amend the Constitution. We have 
taken polling where people have taken our Bill of Rights--those things 
that protect us from unlawful search and seizure, protect us in our 
right of free speech and religion--there have been polls and studies 
done that would just break down the words and ask the people, and the 
majority would say, oh, no, we could not vote for that. Then they are 
surprised to find that it is in the Bill of Rights.
  The Constitution should not be a prisoner of that moment's public 
opinion polls. The Constitution should be protected by the best 
instincts and the greatest sense of responsibility of every man and 
woman in the Senate and in the House. If we start voting by popular 
public opinion poll and not by a sense of history and not by what is 
best for the next generation, then we fail in our own responsibilities 
here.
  Mr. President, I grew up in a family that revered the Constitution. I 
grew up in a family that understood the first amendment. I grew up in a 
family that knew that so much of what makes us Americans is in the Bill 
of Rights. In my public life as a prosecutor, as a lawyer and, more 
important, as a husband and a father, I have realized the advantages I 
have that no one in any other country has because of the protections in 
the Constitution. I also realize that those protections came because my 
predecessors, and all our predecessors in these bodies, resisted the 
temptation to amend the Constitution every time that it was popular. I 
hope we will not do it now.
  The sponsors of this measure repeatedly outline the dangers of a 
budget deficit. We are all in favor of bringing down the deficit, as we 
have done for the last 4 years. But these sponsors have failed to 
address how the proposed constitutional amendment will provide for the 
flexibility needed in economic downturns, without holding working 
families and hard-hit regions hostage to a supermajority vote.
  Senator Durbin's amendment restores that flexibility by requiring a 
simple majority vote to respond to economic recessions and emergencies.
  Whether you are for or against this constitutional amendment, we 
should take the effort to make it a better constitutional amendment. 
Certainly, Senator Durbin's amendment does that, and it deserves our 
support.
  Mr. President, I see my friend from Utah on the floor. Maybe he can 
give us some idea of what he plans to do with our lives for the rest of 
the day.
  Mr. HATCH. I think we have a few more remarks. The distinguished 
Senator from Wyoming would like to

[[Page S1091]]

speak, and the distinguished Senator from Maine wants to speak. I could 
then wrap up, and that should end it for the day. Do you have anybody 
over there desiring to speak?
  Mr. LEAHY. I will check. It would be your turn to go now. I will 
yield the floor so your speakers may proceed. And we will find out if 
there is anybody else on this side.
  Mr. HATCH. I yield to the Senator from Wyoming [Mr. Enzi].
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. ENZI. Mr. President, I rise in support of the passage of the 
balanced budget constitutional amendment. Without that amendment, our 
children and grandchildren will be saddled with a mountain of debt. 
They will be left with no hope of fulfilling their hopes and dreams.
  I feel that it is time to correct the misleading reports that have 
been put forth by many of the opponents of Senate Joint Resolution 1 
over the past few weeks. Their arguments are not new. They have been 
the same arguments for the past 20 years--actually, for almost three 
decades Congress has failed to balance the budget. I am standing almost 
in the shadow of the mountain of budgets that don't balance. That 
failure has led to the current fiscal mess that holds us hostage.
  But what has really kept us from a balanced budget amendment? The 
same old excuses and fear-mongering still prevail, scaring everyone 
from the children to the senior citizens of this country. The excuses 
take a little different form each year, but the same basic fears are 
still being played upon. The easy position to take is to continue 
spending the taxpayers money on feel-good programs instead of grappling 
with the tough issues.

  The debt we are incurring for our kids amounts to taxation without 
representation. We are forcing people who haven't even been born yet to 
cosign on a note. A balanced budget constitutional amendment would tie 
the hands of the spenders in DC. It doesn't throw the baby out with the 
bath water. In fact, it is the life cord that connects the budget to 
the baby. It would protect generations yet to come.
  A balanced budget will do away with the hidden taxes Americans pay in 
the form of higher interest rates. If we pass the balanced budget 
constitutional amendment now, a middle-class family could easily save 
$1,500 a year. That is a nice raise. This is assuming a drop in 
mortgage rates from 7.7 to 5.7 percent, a drop in interest rates on a 
car loan from 9.2 to 7.2 percent, and decline in student loan rates 
from 8.5 to 6.5 percent. Interest rates should be 2 percent lower with 
a balanced budget.
  How would the financial markets view the balanced budget amendment? 
According to many financial market experts, such as David Malpass, the 
more restraint on Government spending, the better the markets will 
respond. Part of the reason for the bullish market is merely the 
suggestion of a balanced budget. Laws enforcing a balanced budget would 
perpetuate a bullish financial market. Currently, interest rates are 
low and the economy is healthy, due again in part by Congress and the 
President getting serious about balancing the budget. All of these 
positive trends are occurring as a result of just the possibility of 
balancing the budget.
  What about the claim that a balanced budget amendment would hobble 
our economy in a recession? First of all, there is a clause in the 
amendment that would allow Congress, by a three-fifths vote, to spend 
more than it takes. In an emergency situation of three-fifths vote 
would not be difficult to attain. Financial experts agree that 
recessions have occurred at times due to Federal mismanagement of 
monetary, tax, or regulatory policies. Mistakes are usually made when 
the Government intervenes too much in the private sector. The amendment 
has a built in method that allows the Federal Government to quickly 
react to these types of glitches.
  The economist John Keynes knew that Government should attempt to 
create a surplus in the good times and that Government must borrow 
during bad times. The problem with our situation is that Congress is 
borrowing during the bad and good, wartime and peacetime, national 
emergency or no emergency. Look at where we are now. We are supposed to 
be having the best economy in years--with a focus on reinventing and 
downsizing government, a huge reduction in military expenses, and a 
Congress and President that want to balance the budget. We lack the 
will and discipline, however, to ultimately balance the budget before 
the end of the 20th century.
  We have had commission after commission study this issue to sheer 
boredom. We all know that revenue is up right now for Social Security. 
We are also well aware that the program will start running a deficit in 
2013. Let's not make political hay out of Social Security. Let's start 
dealing with reality.
  Opponents of the amendment want Social Security exempted or taken off 
budget. It is catchy wording that some senior citizens have bought 
hook, line and sinker. It has absolutely no consistent meaning to 
anyone and it provides a false sense of security. There is a vague 
feeling that ``off budget'' means that we don't want to cheat on Social 
Security and damage the ability to support our seniors.
  I say right now that nobody wants to damage Social Security. Nobody 
wants that to happen. Everyone, including me, wants to protect senior 
citizens. It is absurd to say otherwise.
  Right now Social Security is a partial pay-as-you-go system. The 
people paying Social Security taxes are paying for the people who are 
retired today. It is not a fully funded system. It doesn't build up a 
trust fund. It's a bunch of IOU's. There is no secret vault stacked 
full of Social Security funds. The revenue from Social Security is 
invested into Government-backed securities like Treasury bills. To 
disregard Social Security plays games with the budget. It would require 
an additional $80 billion match up front. Later, when baby boomers 
reach retirement, the fund will go broke without an enormous infusion 
of funds from our children and grandchildren. An amendment is not just 
for the next 8 years.
  It is for that time when there is an extra burden on Social Security.
  As the only accountant in the U.S. Senate, I believe that in order to 
ensure stability and longevity of Social Security, we need to go to a 
modified accrual system of accounting for each of the trust funds.
  We need to talk also about Medicare and the other trust funds, not 
just Social Security. It happens to be the only one that fits with the 
argument of the opponents.
  This accrued system would assure that the moneys coming in match up--
at some point in the critical near future--to the time that the money 
has to go out. A modified accrual method would show that any surplus 
revenue for this year's budget is already committed further down the 
line.
  I believe we should pass a balanced budget amendment even though the 
growth rate of the deficit is falling without the amendment. The budget 
deficit is expected to rise from $107 billion in fiscal year 1996, to 
$124 billion in fiscal year 1997. This is not a reduction in the size 
of the deficit. Some are praising the progress in reducing the deficit. 
We aren't reducing the deficit or the national debt. I don't know where 
their numbers are coming from. They sure aren't coming from the 
Congressional Budget Office. But if we move toward a balanced budget by 
fiscal year 2002, a fiscal dividend of about $34 billion is in sight.
  The Clinton administration and a number of Members of this body have 
already begun a reign of terror on the American people regarding the 
balanced budget amendment. Members of the administration have 
criticized the amendment by claiming it is unenforceable. These attacks 
are not only unfounded, they represent a sad critique on the 
administration's view of fulfilling its constitutional obligations.

  On January 7, I swore a solemn oath to preserve, protect, and defend 
the Constitution of the United States. All of my colleagues in the 
Senate and the House have taken this same pledge. President Clinton 
took the same oath on January 20. This is one of the most serious 
pledges a person can take in his or her lifetime. It binds all Members 
of the Congress and the President to follow all the provisions in the 
Constitution. If the balanced budget amendment was added to the 
Constitution, we would be bound by our most solemn oath to pass a 
balanced budget in each and every fiscal year.
  For the administration to criticize this amendment as unenforceable 
is a

[[Page S1092]]

very serious charge indeed. Does the President intend not to fulfill 
his constitutional duty to preserve, protect, and defend the 
Constitution by delivering a balanced budget proposal to Congress 
before each fiscal year? Is the administration insinuating that Members 
of the Senate and the House of Representatives are willing to blatantly 
violate the clear language of our Constitution which they took an oath 
to uphold and defend?
  I do not share the Clinton administration's cynical view that our 
constitutional officers will openly and flagrantly flout their solemn 
duties. If we pass the balanced budget constitutional amendment, I have 
every confidence that Members of this noble Chamber as well as our 
friends in the House will take their oath to defend the Constitution 
very seriously. We will balance the budget because we have sworn to 
uphold the Constitution. We will balance the budget because we desire 
to leave our children and grandchildren a legacy of hope and prosperity 
instead of the horror of a $5.3 trillion debt.
  I want to stress that the enforcement of the balanced budget 
amendment will rest first and foremost with this Congress. Under 
section 6 of the balanced budget constitutional amendment, Congress 
must pass implementing legislation to enforce this amendment. This 
provision indicates that it will be primarily Congress--neither the 
President nor the Federal courts--which will provide the means of 
enforcement. Claims that this amendment will result in new powers of 
Presidential impoundment or judicial involvement in the budgetary 
process are unfounded. These are nothing more than further attempts by 
the amendment's detractors to sidestep the serious obligation we all 
have of safeguarding the financial future of our Nation, and our kids 
and grandkids.
  I urge my fellow Senators to join me in voting for Senate Joint 
Resolution 1, the balanced budget constitutional amendment. This will 
be a giant step in restoring responsibility to our Government, and it 
will demonstrate to future generations that we were willing to act 
responsibly in the most serious of our tasks. And if we do not balance 
the budget, we become the longest running game show with the lowest 
ratings in history.
  Mr. President, I yield the floor.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I thank the distinguished Senator from 
Wyoming for the excellent remarks he has made here on the floor today. 
I have really been appreciative of the new Senators coming and talking 
about this because each and every one of them is a prime cosponsor of 
this amendment. What a change that is from two Congresses ago when we 
lost this by three votes, one Congress ago by one vote.
  I am very grateful to have had the good people we have listened to 
all day today. It makes a lot of difference to me.
  I am happy to yield the floor.
  Ms. COLLINS addressed the Chair.
  The PRESIDING OFFICER. The Senator from Maine is recognized.
  Ms. COLLINS. Mr. President, I rise to add my voice to those of my 
distinguished colleagues who have spoken in favor of a balanced budget 
amendment to the U.S. Constitution.
  It is not surprising that with a national debt which is $5.3 trillion 
and still growing this debate is awash in statistics, each more 
staggering than the last. As someone who ran for office to fight for 
more opportunities and better jobs, I find the costs in those areas of 
our chronic failure to balance the budget to be particularly troubling.
  In light of the President's call for a crusade for education, one of 
the more telling statistics is that last year the Federal Government 
spent about $240 billion to service our national debt, an amount that 
is almost eight times greater than the amount we spent on education. 
Think about that. If we had been operating the Government without debt, 
we could have spent nine times more on educating our children. Now, 
that is what I call a crusade.
  Whatever the long-term benefits to the public sector from balancing 
the budget, they pale in comparison to the benefits to our families. 
The Concord Coalition has estimated that had we not run deficits for 
the past two decades, the average family's annual income would be 
$15,500 higher. Looked at prospectively, the General Accounting Office 
has said that we will increase per capita income by 26 percent over the 
next two decades if we balance our budget.
  These are not partisan statistics, just as this is not a partisan 
issue. The numbers I have cited to demonstrate the enormous costs of 
our past fiscal failures can be found in a recent letter to the editor 
from former Democratic Senator Paul Simon, a leader in the battle for a 
constitutional amendment, whose 22 years of congressional service ended 
before the goal to which he was so deeply committed could become a 
reality.
  The economic evidence that favors a balanced budget is overwhelming. 
But one legitimately may ask how I make the jump from the need for a 
balanced budget to the need for a constitutional amendment mandating a 
balanced budget. That is a political not an economic issue but the 
evidence is equally as overwhelming.
  The simple fact is that the road to our huge national debt has been 
paved with good intentions. We have had the Deficit Reduction Act, the 
Gramm-Rudman Act, the Budget Enforcement Act, and yet we still have 
deficits. The old saying that ``We have met the enemy and it is us'' 
has never been more applicable.
  As a freshman Senator, I do not sit in judgment on my predecessors 
and say that I would have done it differently. I know the pressures on 
Washington to spend money, even borrowed money. By and large, each 
Congress sets out to be fiscally responsible, but our national debt 
still grows. The truth is experience has taught us that even in good 
times we need the discipline of a constitutional amendment.

  To those who say that this issue does not rise to the level of 
constitutional protection, I respectfully disagree. It is the unique 
genius of the U.S. Constitution that serves to protect our people and 
their property from the excesses of their Government. It is difficult 
to imagine a greater excess, at least in the realm of property, than a 
debt burden of more than $5 trillion. The legacy we are leaving our 
children and our grandchildren, many of them not yet born, is taxation 
without representation in its most egregious form.
  As I said earlier, this is a debate in which there has been no 
shortage of statistics and no shortage of speeches, but buried 
somewhere beneath that pile of numbers and mounds of rhetoric is a very 
simple principle. That is that all of us, including the Congress of the 
United States, must be personally responsible for our actions. In the 
context of the budget, personal responsibility means not spending what 
is not ours to spend.
  The 104th Congress struck a strong blow for personal responsibility 
in its welfare legislation. It told able-bodied welfare recipients that 
they could not live off the efforts of others; that they would have to 
earn their own way. For those who grew up in a culture of dependency, 
this was a harsh message. But it was the right message because 
responsibility for one's own actions is the core of the American 
effort.
  I think it important that the Congress and the President not hold 
themselves to any less of a standard of personal responsibility. During 
the past quarter century, a culture of dependency has developed right 
here in the U.S. Congress, and it is reflected in our dependency on the 
money of future generations. In each of the past 27 years, we have 
borrowed from our children and our grandchildren to buy things for 
ourselves, building up an immense debt with no end in sight.
  The legacy we are leaving, however, is not just financial. It is a 
legacy of excess, of taking advantage of those who cannot protect their 
own interests, of practicing not deferred gratification but, rather, 
deferred responsibility.
  I recognize that deficits are sometimes unavoidable and that, indeed, 
they are sometimes critical to finance wars or to get the economy 
moving out of a recession. The balanced budget amendment would still 
permit deficit spending in the event of war, recession, or other 
emergency, but deficit spending today is no longer a tool carefully 
used by Congress and the President to respond to emergencies. Rather, 
it has become a permanent feature of our fiscal landscape.

[[Page S1093]]

  Just how permanent deficit spending has become is reflected in the 
staggering fact that if every man, woman, and child in this Nation 
brought all of their currency to Washington, DC, it would not be enough 
to pay off our national debt. Those who argue that we do not need a 
constitutional amendment to solve this problem are simply ignoring our 
fiscal history.
  I yield the floor.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I believe I will be the last to comment 
today, and I deliberately waited to the end to allow some other 
speakers to have a turn, but we do have an amendment which has been 
filed by the distinguished Senator from Illinois [Mr. Durbin], and I do 
believe I need to make a few remarks about that. But I do not intend to 
take too much time here.
  Senator Durbin has offered an amendment to the balanced budget 
amendment that would allow for suspension of the balanced budget rule 
in times of ``economic recession or serious economic emergency.'' I 
wonder what those words mean. Some words, when placed into the 
Constitution, can have almost any meaning.
  The very purpose of this provision of the distinguished Senator from 
Illinois is to make the balanced budget amendment easier to waive. 
Instead of trying to find ways to avoid fiscal responsibility, we ought 
to be working toward passing a strong balanced budget amendment that 
will help us to keep out of recessions in the first place.
  As an initial matter, any definition of ``downturn'' is malleable and 
could be abused by any future Congress bent on deficit spending. This 
amendment is no different. Trying to deal with a concept as loose as an 
economic downturn without even an attempt at defining terms can make 
this a loophole you could drive a truck through. It will not be long 
until a convoy starts rolling through. Furthermore, there is a loophole 
within the loophole, because the amendment does not limit the waiver in 
any way, such as to amounts related to the emergency.

  Under this provision, even during times of significant national 
growth, certain regions may experience an economic downturn which might 
give Congress a reason to trigger this waiver, whether we actually need 
to borrow to respond or not. Or there could be a general feeling of 
``economic anxiety,'' or a perceived sense of anxiety felt in 
Washington about the economy. We can create anxieties about anything 
around here. For instance, I am very anxious about these 28 years of 
unbalanced budgets that are represented by this stack of budget 
submissions right here. We have had people worrying all day that these 
volumes might fall off and crush somebody. I just hope it is not us. 
But the debt burden they represent are crushing the American people.
  Year after year of unbalanced budgets and all we get from the other 
side is, ``All we need is the will to do it, to balance the budget.'' 
This President says we are going to do it by the year 2002, but he's 
going to do 75 percent of the balancing in the last 2 years according 
to the budget filed today. Give me a break. It is just more of the 
same. That is why we are here.
  I don't think it takes any brains to figure this one out. It is a no-
brainer to know that these people who file these amendments do not want 
any balanced budget amendment, they do not want any constraints; they 
want to keep spending just like they always have. We have plenty of 
unbalanced budgets around here. We have done it for 28 years straight, 
and actually for the most of the last 60 years. We just put 28 budget 
submission volumes up here because we thought to stack up our budgetary 
failures any higher would be truly dangerous. In fact, I am not sure 
this little table will hold this throughout the whole debate.
  Let me say this. Even during times of significant national growth, 
under this proposal of the distinguished Senator from Illinois, we 
could have a waiver of the balanced budget amendment during times of 
economic boom, just when we should be balancing the budget or running a 
surplus.
  I believe the general three-fifths waiver already provided for in the 
balanced budget amendment strikes the right balance. It will allow 
Congress to waive the balanced budget rule during times of real need, 
but it will prevent those who are simply trying to find an easy way out 
of a budget crunch from strapping even more debt onto the backs of our 
children and future generations. The general three-fifths waiver 
provision will give Congress an incentive to plan ahead, rather than to 
borrow and spend in good times and bad, just like we have up to now, 
and then when things get tough, just go borrow some more. That is what 
we do. This is a recipe for instability.
  You will find the people who bring these amendments by and large are 
people who were never, never going to vote for a balanced budget 
amendment. But they will do anything to stop it, anything to stop us 
from having to live within budgetary constraints.
  Mr. President, this amendment is based in part on the largely 
rejected notion that increased borrowing will help us out of a 
recession. Fred Bergsten, a noted economist who had testified in 
support of the balanced budget amendment in past years, suggested the 
better way to go is to shoot for a yearly surplus, and let that take 
care of any truly automatic fluctuations and any truly pressing needs 
at that time, if there are any.
  Further, financial market experts have stated that increased 
borrowing and spending is not a cure for recessions. The better way is 
to get Federal spending and borrowing under control, which will make 
for a stronger, more stable economy, which will help us avoid economic 
problems in the first place.
  We should learn from other countries in the world that are trying to 
``spend their way out of recession.'' Several European countries and 
Japan have been trying to do this lately. The result has been continued 
recession and even larger debt. On the other hand, a number of the 
world's up and coming countries are enjoying booming economies while 
keeping their national budgets in balance or even surplus. Perhaps we 
should be more concerned that we do not spend ourselves out of 
prosperity. I think we ought to think about that. Are we spending 
ourselves out of prosperity?

  One commentator has wryly stated that the theory of borrowing and 
spending out of a recession ``is the game plan that propelled Argentina 
and Bolivia into economic superpower status in the 1970s.'' That is 
pretty sarcastic, but I think a pretty good comment.
  The balanced budget amendment in no way prevents us from running a 
reasonable surplus which could be used to offset the effects of an 
economic downtown. This surplus would allow us to use fiscal policy 
within the balanced budget rule better than we can now without it.
  Even if we were to drop below balance using the intended rainy day 
surplus, the balanced budget amendment has anticipated this sort of 
need. A three-fifths vote in Congress will allow the balanced budget 
amendment rule to be suspended for a year. That way we have the 
flexibility to run reasonable deficits if we need to. The three-fifths 
requirement makes sure we do not waive the amendment unless it is a 
true need and not just an attempt for us to avoid making tough choices, 
which is something that goes on here all the time.
  So, we do not need any exceptions or loopholes. What we need is a 
strong balanced budget amendment as a mechanism in the Constitution to 
help us to get to a balanced budget. We should be less concerned about 
when we can spend more and more concerned about when we must spend 
less.
  Some say we are spending less. We have been hearing a lot in just the 
last 2 days about what a wonderful job we have done in reducing the 
deficit. Of course, we do not hear much about the fact that so long as 
we still have a deficit, our debt is increasing. In fact, we are not 
spending less. You would think a $107 billion deficit was a wonderful 
nirvana-like state. Only in Washington do we celebrate a reduction in 
the increase in the debt as an achievement, only here in this 
surrealistic place where we have these surrealistic budgets, all of 
which were unbalanced for 28 straight years, some of which were 
proposed to be balanced budgets but were not. None of these since 1969 
have been balanced.
  Another fact we do not hear much about is even though the economy is

[[Page S1094]]

doing fairly well, we are still in a deficit. Opponents of the balanced 
budget amendment keep talking about how the deficits are related to the 
economy. It seems to me, that given the current health of the economy, 
the budget should be balanced right now. But of course it is not. And 
of course the blame must be Mr. Reagan's or Mr. Bush's.
  Give me a break. The Reagan tax cuts actually produced 40 percent 
greater increase in revenues. What really cost us were two things, part 
of which was President Reagan's fault. One was the increase of strength 
to our military. But, on the other hand, I think most commentators now 
will give President Reagan credit for having brought down the iron 
curtain and having ended the cold war. But the other side of that 
equation was, during all of Reagan's 8 years, and all of Bush's 4 
years, the House of Representatives where all money bills originate was 
controlled by liberals. In particular, during the Reagan years it was 
Tip O'Neill who led the liberal onslaught against the budget. Even 
though Reagan cut taxes and reduced marginal tax rates, and revenues 
actually went up--not as high as we would have liked, but they went up 
some 40 percent--even though that happened, the liberals in Congress 
were spending us into bankruptcy. That, coupled with the increase in 
the military, of course, did get us to the point where we are.
  (Ms. COLLINS assumed the chair.)
  Mr. HATCH. It is an old expression that the time to save money is 
when you have it. If this economy is so good, as some of our colleagues 
are saying, Madam President, why do we not have a balanced budget. 
Why? Because it is easy to spend other people's money in good times and 
bad. That is why we need to correct Congress' spending bias with a 
constitutional amendment.

  This country has enjoyed some remarkable economic progress in the 
latter half of this century, and yet the United States has borrowed 
ever more money, despite the fact that most of those years were both 
peaceful and prosperous. So when people hear the opponents of the 
balanced budget amendment talk about needing to spend more in 
recessions, they should consider whether we have spent less in 
prosperous times. Of course, we have not. The debt has simply gone up 
higher and higher. It now stands at over $5.3 trillion.
  Let me just take a moment to illustrate just how big that is. This 
chart shows, if you were to lay the debt of $5.3 trillion in $1 bills 
end to end on a road, they would stretch 514,283,460 miles. Were you to 
drive to the end of that road traveling an average of 500 miles per day 
at 65 miles per hour, it would take you 2,818 years. You would have to 
drive along the road paved with dollar bills for 500 miles a day at 65 
miles an hour for 2,818 years.
  That gives us a little understanding of how big the debt is. Two 
thousand eight hundred and eighteen years is somewhat difficult to 
comprehend, so let me put it in more descriptive terms.
  Had the legendary founder of Rome, Romulus, gotten on his horse in 
753 B.C. and started down that road of dollar bills at a rate of 500 
miles per day, he would still be some six decades away from reaching 
the end of that road. In the course of his travels, he would have 
circled the globe more than 20,000 times.
  That is our debt. It is no longer cyclical. It has become a permanent 
structure in Washington. It even has its own Government office, the 
Bureau of Public Debt. I am not kidding; that office really does exist. 
Our deficits have not been countercyclical, they have been 
counterproductive.
  What we need is to change the way Congress thinks. Only a requirement 
with the strength and staying power of a constitutional amendment can 
make that change. Only the balanced budget amendment can get our fiscal 
house in order and keep it there.
  Before we are done with this debate, we will likely see amendments to 
exempt certain programs, exempt certain groups, and waive the balanced 
budget amendment whenever the times get tough. But this is precisely 
the type of thinking that has brought us 30 straight years of deficits 
and a $5.3 trillion national debt.
  The way to avoid the hardships of recession is to pass a strong 
balanced budget amendment and get our runaway deficit spending under 
control. That will take some guts. Because it is tough, you will see 
all of these amendments to try and protect one constituency after 
another. The fact is, we have to keep all the budget together and 
approach it in an intelligent and thoughtful way. And those programs, 
like Social Security, that are so justifiable are better than capable 
of competing, and they will compete well. Some of the programs that are 
not quite as good--all of them have some merit--but some that are not 
quite as good may have to have some changes. All of our budget has to 
have some changes if we are ever going to get the budget and economy of 
this country under control and save the future for our children and 
grandchildren.
  Madam President, I ask unanimous consent to have printed in the 
Record an excellent editorial by the Investors Business Daily of 
today's date entitled ``Perspective: Balanced-Budget Blather,'' as well 
as an excellent editorial by Bruce Bartlett entitled ``Dangers that 
Don't Hang in the Balance.''
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                        Balanced-Budget Blather

       Without deficits, recessions would be longer, deeper and 
     harder to pull out of, the common wisdom says. Treasury 
     Secretary Robert Rubin echoes that in opposing a balanced-
     budget amendment. But it's not true.
       The idea that deficit spending could smooth out the rough 
     spots in a business cycle comes from John Maynard Keynes. 
     Recessions, he believed, started when all the buyers in the 
     economy suddenly stopped spending.
       Sellers usually respond to such a decline in demand by 
     cutting output and jobs, rather than cutting prices, the 
     Keynesian view went. That threw more people out of work, and 
     further reduced aggregate demand.
       Only government could turn this cycle around, by pumping 
     money into the economy. It did so by hiring people for public 
     works programs, for example.
       But because the government collects less in taxes during 
     recessions, those public programs had to be paid for with 
     debt, Keynes argued.
       The evidence shows that public works programs have done 
     nothing to solve recessions, a 1993 article by economist 
     Bruce Bartlett in The Public Interest magazine pointed out.
       Spending packages aimed at fighting recession have never 
     been enacted before a recession ended on its own, as the 
     chart shows.
       In fact, Congress often enacts these packages the very 
     month the recession is over. They are usually nothing more 
     than pork-barrel spending dressed up as compassion.
       Recessions are usually defined as two straight quarters of 
     falling GDP. So no one actually knows a recession is 
     happening until six months after it starts. No one knows it's 
     over until three months later.
       Even then, it takes Congress time to pass a law for extra 
     spending. And it takes still more time for that money to make 
     its way through the economy.
       So even if Congress could tell when a recession was 
     starting--unlikely, given the records of most economic 
     forecasters--it still wouldn't have more than a small effect.
       And Keynes was wrong not just in practice, but in theory as 
     well.
       He based his whole theory on the notion that government 
     experts acted rationally, while the average person did not. 
     Central planners could know enough and act quickly enough to 
     save people from the consequences of their own bad 
     decisions--clearly not the case.
       There are programs, such as unemployment insurance, that 
     kick in automatically when recession hits, without having to 
     wait for Congress to act. The amount those programs actually 
     increase during recession could be easily handled within a 
     balanced budget, however.
       Between 1980 and 1984--which includes years of deep 
     recession--real spending on jobless benefits rose $47.4 
     billion above its level in 1979, an economic peak. That 
     increase was just 1% of government spending over those four 
     years.
       Recession have been less severe in the postwar period, many 
     economists argue, largely because of the greater role 
     government has played in easing recessions. But it is not 
     certain that they are less severe, and it is even less 
     certain that this is due to government.
       On the surface it seems true. From 1920 to 1938, recessions 
     averaged 20 months, with a 14.2% decline in real GNP. Since 
     1948; they averaged 11 months, with 2.4% drop in real GNP. 
     Unfortunately, it's hard to compare the two periods, because 
     the prewar data are quite crude.
       National Bureau of Economic Research economist Christina 
     Romer, in an key 1986 American Economic Review article, tried 
     to compare apples with apples. She adjusted the more recent 
     data so that it was calculated much like those of the prewar 
     period.
       And she found the evidence of a change in the length, 
     frequency and severity of business cycles was weak.
       Even if recessions are less severe, it may have little to 
     do with government. The growing importance of the service 
     sector, where

[[Page S1095]]

     employment tends to be stable, could be one reason. And 
     technology has helped ease the sharp boom-bust cycle of the 
     farm and factory sectors.
       Legitimate gripes about a balanced-budget amendment are 
     easy to come by. But Rubin's is not one of them.

                                TOO LATE
------------------------------------------------------------------------
                                               Date of anti-recession
             End of recessions                       legislation
------------------------------------------------------------------------
Apr. '58..................................  Apr.--July '58.
Feb. '61..................................  May '61--Sept. '62.
Nov. '70..................................  Aug. '71.
Mar. '75..................................  Mar. '75.--July '76, May
                                             '77.
Nov. '82..................................  Jan.--Mar. '83.
Nov. '91..................................  Nov. '91.--Apr. '93.
------------------------------------------------------------------------
Source: The Public Interest.

                 Dangers That Don't Hang in the Balance

                          (By Bruce Bartlett)

       Treasury Secretary Robert Rubin strongly opposes the 
     Balanced Budget Amendment to the Constitution. His main 
     concern is that it will hamper the government's ability to 
     respond to an economic downturn. While this is a valid 
     concern, it is overstated. Congress can always abandon the 
     balanced budget requirement by a super-majority vote, which 
     it certainly would do in the event of an economic crisis. 
     More importantly, however, there is no evidence that deficit 
     spending has been necessary to recover from past rescissions.
       It is undeniably true that Congress always passes some sort 
     of anti-recession legislation every time there is an economic 
     slowdown. But the history of such legislation is that it 
     always comes too late to do any good. In fact, the date that 
     anti-recession legislation becomes law often corresponds to 
     the very date that the recession ends. More frequently, the 
     legislation comes well after the recession's trough. And 
     since the actual spending does not come into effect 
     immediately, it has always been the case that anti-recession 
     spending did not impact on the economy until long after the 
     recession's end--sometimes many years afterward.
       The table illustrates this point, looking at every major 
     postwar recession as defined by the National Bureau of 
     Economic Research. As one can see, there is not a single case 
     in which anti-recession legislation was enacted in a timely 
     fashion, so as to mitigate the economic downturn. In fact, 
     one can argue that such legislation may have made matters 
     worse. By overstimulating the economy during upturns, it may 
     have sown the seeds of future recessions.
       The problem is that for anti-recession spending to work, 
     forecasters would have to see a recession coming. Legislation 
     would have to be enacted into law well in advance, and 
     programs implemented so as to coincide with the beginning of 
     the downturn. These are virtually impossible requirements to 
     meet. Forecasters seldom, if ever, accurately predict turning 
     points in the economy. And if they could, it is doubtful that 
     they would be persuasive enough to convince Congress and the 
     administration to act in time. And even if they did, it 
     usually takes a year or more to get programs implemented and 
     money flowing.
       Thus it is absurd to argue that the Balanced Budget 
     Amendment should be defeated because it will hamstring the 
     government's ability to respond to economic downturns. All 
     recessions really do is give politicians an excuse to enact 
     pork-barrel public works programs in the name of mitigating 
     the recession. If the amendment prevents such wasteful 
     spending it will serve a useful purpose.

           DATES OF RECESSIONS AND ANTI-RECESSION LEGISLATION
------------------------------------------------------------------------
            Beginning                     End             Legislation
------------------------------------------------------------------------
Nov. 48.........................  Oct. 49...........  Oct. 49.
Aug. 57.........................  April 58..........  April-July 58.
April 60........................  Feb. 61...........  May 61, Sept. 62.
Dec. 69.........................  Nov. 70...........  Aug. 71.
Nov. 73.........................  Mar. 75...........  Mar. 75, July 76,
                                                       May 77.
July 81.........................  Nov. 82...........  Jan.-Mar. 83.
July 90.........................  Nov. 91...........  Nov. 91, April 93.
------------------------------------------------------------------------
Source: The Public Interest (summer 1993).


  Mr. HATCH. Madam President, there will never be a time when we have a 
true economic need and a true economic emergency that we will not get a 
three-fifths vote. As a general matter, whenever we needed it for 
unemployment compensation, whenever we needed it for emergencies, there 
has always been more than three-fifths. That requirement of consensus 
to borrow, which allows for flexibility but not complete laxity, is the 
value of this amendment and the strength of this amendment.
  So we can't just do what our friend from Illinois would like to do, 
and that is to just have a nebulous set of terms that would allow this 
Congress to do whatever it wants to about spending in the future. What 
we are trying to do is establish some restraints and get this place 
under control.
  This constitutional amendment's approach is a bipartisan approach. It 
is not a Republican approach; it is not a Democrat approach. It has 
taken a lot of us working together year after year--in my case, over 20 
years now--to get this bipartisan amendment, the only one having a 
chance of going through, and everybody knows that. So hoping for a 
version more to one's liking is no excuse not to vote for this. 
Everybody knows this is the amendment. We are hopeful this amendment 
will pass intact and be sent to the House, and if it receives the 
required votes in the House, it will be a great day for America.
  I yield the floor.
  Ms. MOSELEY-BRAUN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Illinois.
  Ms. MOSELEY-BRAUN. Thank you, Madam President. I rise to speak on the 
balanced budget amendment to the Constitution.
  Madam President, I am a liberal. I also support a balanced budget 
amendment to the U.S. Constitution. To some, this might appear a 
contradiction in terms. To others, including my predecessor in office, 
Senator Paul Simon, it is as logically consistent as the classical 
definition of ``liberalism,'' and I quote: ``Belonging to the people; 
giving freely; generous; tolerant of views differing from one's own; 
broad-minded; favoring reform or progress as in education; favoring 
political reforms tending toward democracy and personal freedom for the 
individual; progressive.''
  Those are all definitions to be found in Webster's New World 
Dictionary of a ``liberal.''
  It is precisely because I believe in this definition of liberalism 
that I believe the balanced budget amendment is necessary. Chronic 
budget deficits and cumulative national debt currently threaten to 
undermine our ability to act in the public interest.
  Budget deficits make it much harder for our country to focus on what 
is really important: the objectives we want to achieve. Only by 
balancing the budget will we be able to reclaim our country's ability 
to decide to make important investments in our communities, such as 
fixing crumbling schools, investing in mass transit, providing pension 
security, ensuring that our airways are safe, or caring for the poor.
  Unless we take a long-term view of budgetary problems and require 
permanent fiscal prudence, the Federal Government will be forced to 
spend its resources on paying interest to bondholders, rather than on 
addressing the priorities of the American people.
  In the name of intergenerational fairness--fairness to these young 
people who are here as pages and their generation--in the interest of 
intergenerational fairness, we need to keep in mind the needs of the 
next generation, not just current short-term issues.
  While we want to be able to respond to the next emergency and to the 
next one, not telling the truth about the budget and not making the 
tough choices required forces us to continue to try to finance our 
future with debt. That accumulation of debt, however, will make America 
less competitive and less able to respond effectively to future 
emergencies and future priorities.
  Because of persistent deficits and a huge national debt, the value of 
what Government is doing is being lost. Social Security, Medicare and 
Medicaid, for example, have reduced poverty among the elderly to the 
lowest levels since statistics first started being kept. Social 
Security has administrative costs of less than 1 percent of benefits 
paid, and Medicare has administrative costs of less than 3 percent of 
benefits paid, both far better in terms of administrative costs than 
their private counterparts.
  These programs account for almost 50 percent of all noninterest 
Federal spending, and they have made it possible for literally tens of 
millions of Americans to enjoy a secure, healthy retirement, and they 
have helped increase longevity.
  The Federal Government has also built the Interstate Highway System, 
set aside national parks and created a space program that put men on 
the Moon, and will soon begin a space station.
  We financed an American military that won the cold war, and we went 
to the Persian Gulf and achieved victory at the lowest possible cost in 
American lives.
  In short, Madam President, Government can work. But Government 
successes are being swallowed up in interest costs that were only 40 
years ago

[[Page S1096]]

about a penny out of every dollar and now today are 15 cents out of 
every dollar, and growing. Is there any wonder that Americans felt more 
prosperous in the 1950's and in the 1960's than they do today?
  The balanced budget amendment will not undermine the value of what 
the Federal Government does. The balanced budget amendment will help 
clear out that undergrowth of debt, making room for more investment in 
the values that we hold dear.
  According to the Congressional Budget Office, the Federal Government 
is right now spending $684 million every day for interest payments on 
the national debt. That is $684 million that could otherwise be used 
for Head Start, for housing programs, for our battle against crimes or 
drugs or to repair our crumbling school infrastructure. And $684 
million a day is a resource hemorrhage that we, as a nation, can ill 
afford.
  In fiscal year 1996, we spent $241 billion to service our national 
debt. The national debt, as you no doubt have heard, is now $5.2 
trillion, and it is growing. We cannot allow these trends to continue 
unchecked. If we do not act now, if we wait until the country is on the 
brink of financial ruin, we will have totally failed our obligation to 
the American people and to our country and our children, and the next 
generation will pay the price for that failure.
  Madam President, I served on the Bipartisan Commission on Entitlement 
and Tax Reform. One of the conclusions that was made clear there was 
that unless we get the deficit under control, by the year 2003 
mandatory spending, which is entitlements plus interest on the national 
debt, by that year they will account for fully 73 percent of the total 
Federal budget. These few programs already consume almost two-thirds of 
Federal resources. So domestic discretionary spending, that is to say, 
the kinds of things we appropriate here, will be frozen out altogether 
if we do not get a handle on the continuing deficits.
  Even though, Madam President, the current economic news is generally 
good and the economy continues to expand, we know that markets go up 
but then markets also go down again. So the trend, given the changes in 
our country and the demographic changes, is not likely to continue.
  A recently released Congressional Budget Office report entitled, 
``The Economic and Budget Outlook: Fiscal Years 1998-2007,'' points 
out:

       Despite the improved outlook through 2007. . .the budget 
     situation will start to deteriorate rapidly only a few years 
     later with the retirement of the first baby boomers and the 
     continued growth of per-person health care costs.

  Madam President, the demographics of our time are something that we 
have to come to grips with. I like to tell people that this year alone 
a baby boomer will turn 50 every 9 seconds. So we are aging as a 
population. That is impacting on our budget situation and the decisions 
that we here in the Congress have to make.
  By the year 2012 the Social Security trust fund will begin spending 
more money than it takes in. By the year 2029 the trust fund will have 
exhausted all its resources. After 2012, when there are no more 
surpluses, Federal deficits will really begin to explode, an explosion 
that will be fueled by the looming retirement of the baby-boom 
generation.
  It is true that for the next 15 years Social Security will be running 
a surplus. It will be taking in more than it spends. I agree that the 
existence of these annual surpluses does make the consolidated budget 
deficit look smaller in the relative short run. But that surplus is a 
temporary phenomenon. After 2012 Social Security will begin consuming 
that accumulated surplus.
  Madam President, the temporary or the permanent nature of the 
surpluses perhaps would not be important if it were actually possible 
to decouple Social Security completely from the rest of the Federal 
Government. Social Security, however, is intimately related to the rest 
of the Government as long as the Social Security system invests in 
Treasury bonds.
  Right now the Treasury Department is selling U.S. Government bonds to 
the public, both here and abroad, and to the Social Security system. 
What that means is that whether Social Security is part of the budget 
or not, the Treasury Department will be selling exactly the same amount 
of bonds to the public, including those sold to the trust fund. And it 
is the amount of bond sales to the public that is the real measure of 
the Federal deficits in any given year.
  The unbreakable connection of an even theoretically off-budget Social 
Security system to the rest of the Federal budget will become even more 
clear by the year 2012 when the Social Security trust fund ceases to 
take in more money than it pays outs. After that year, Social Security 
will begin cashing in its Treasury bonds. So whether Social Security is 
on budget our not is irrelevant, frankly, to the fact that the Treasury 
Department will have to find the cash to pay off those Treasury bonds.

  There are only three basic ways that that can be done: issuing new 
bonds to the public, thereby increasing the Federal deficits in those 
years; raising taxes by the amount necessary, which is another option; 
or cutting spending on other programs by the amounts needed. I hope we 
never have to get to making those Draconian cuts. I believe that 
passing the balanced budget amendment will keep us from having to make 
those choices under that gun.
  Madam President, taking Social Security out of the budget, therefore, 
does nothing to make our long-term budget problems either better or 
worse. It does nothing to protect Social Security from the rest of the 
budget because, again, Treasury bond purchases and sales continue to 
bind Social Security tightly to the rest of the budget. Perhaps most 
important, it does nothing to protect the long-term future of Social 
Security. The only way to protect the long-term future of Social 
Security and to keep the important Social Security contract with the 
American people is through reform of that system.
  Madam President, the balanced budget constitutional amendment will 
not solve these problems overnight. What it will do, however, is force 
the Congress, the President, and the American people, to face the truth 
about the budget, all of it, both on the revenue and on the expenditure 
side of the equation.
  Unless we get the deficit under control, we will be leaving to our 
children and to our children's children a legacy of debt that will make 
it impossible for them to achieve the American dream. We owe it to our 
children and their children to get our fiscal house in order now. If we 
fail to do so, our legacy to future generations will be one of greater 
problems and diminished opportunities.
  Madam President, I come from a working-class family. The availability 
of public education made it possible for me to get advanced degrees. I 
have no doubt that without the commitment of my parents' generation to 
create a national community which would nurture my talents, I would not 
be here today speaking to you as a U.S. Senator. It saddens me that it 
is harder for a child to get a quality education or for a teenager to 
pay for college or for a young couple to have a single wage earner 
outside the home today than it was a generation ago.
  The recent dismantling of our national commitment to support poor 
children is just the beginning of the chilling effect that these 
chronic budget deficits will have. We are faced with making hard 
choices by which this generation will define our national community. 
That is again why I support this amendment.
  But, Madam President, whether we look to the future or look to the 
past, the arguments in favor of passage of the balanced budget 
amendment are compelling.
  As one of our Founding Fathers, Thomas Jefferson, stated:

       We should consider ourselves unauthorized to saddle 
     posterity with our debts, and morally bound to pay them 
     ourselves.

  This proposition is as true today as it was when he stated it 
centuries ago.
  Madam President, our country's debt did not emerge from a national 
emergency nor from some massive Federal initiative to build roads or 
educate children or to create jobs for poor people. It came in 
peacetime and, frankly, largely while no one noticed. When a national 
consensus against chronic deficits did emerge, it came after the debt 
had reached historic proportions.

[[Page S1097]]

  Madam President, we should have known better. George Washington, in 
his farewell address warned the Nation:

       As a very important source of strength and security, 
     cherish public credit. One method of preserving it is to use 
     it as sparingly as possible, avoiding occasions of expense by 
     cultivating peace, but remembering, also, that timely 
     disbursements, to prepare for danger, frequently prevent much 
     greater disbursements to repel it; avoiding likewise the 
     accumulation of debt, not only by shunning occasion of 
     expense, but by exertions in times of peace, to discharge the 
     debts which unavoidable wars may have occasioned, not 
     ungenerously throwing upon posterity the burdens which we 
     ourselves ought to bear.

  Again, Madam President, sage advice from the Founding Fathers did 
not, could not, overcome the pressures of the political and demographic 
realities of our times. Legislators are often judged by constituents on 
their ability to--you may not have this expression in your State. But 
we do in Illinois-- ``bring home the bacon'' whether in terms of actual 
pork barrel project specific spending or in terms of across the board 
program funding. Each and every constituency wants its share. Each has 
legitimate rationale for its demands.
  However, these constituency demands must be seen in the long term and 
overarching context of our responsibility to the public interest. The 
demographic changes the future holds will mean more demand, not less, 
for health care and retirement security, at precisely the time that 
changes in technology and the global economy requires more, not less, 
investment in education, transportation, and infrastructure. The 
confluences of these trends which government does not control make more 
important than ever that we make decisions about those things we do 
control. Passage of the balanced budget amendment will force a 
discipline in our decisionmaking which may well be the only force great 
enough to counter the institutional force in favor of secret spending.
  I am not keen about tinkering with the Constitution. Happily, the 
Founding Fathers envisaged the periodic popularity of constitutional 
amendments, and required absolute consensus in the process. I hope the 
balanced budget amendment is one of the few to make it through the 
Congress and ratification by the States.
  There have been amendments to the Constitution proposed for just 
about everything in recent years. I hope, however, that this one which 
had been suggested at the time of the Constitutional Convention, that 
this one finally makes it through.
  Now, Madam President, critics of the amendment have argued or warned 
us that a balanced budget amendment could worsen economic recessions or 
downturns. The amendment, however, contains a safety valve for just 
this sort of situation. The safety valve would allow Congress to 
provide for a specific deficit by passing a law with a three-fifths 
vote in each House; the same vote, I point out, that is required to 
waive the Budget Act. I believe in the event of an emergency or a 
recession, Congress would be able, would be anxious to obtain a three-
fifths majority to enact a countercyclical package of tax cuts or 
investment spending to counter the economic downturn. The requirement 
of the three-fifths majority, however, will ensure that the creation of 
a specific deficit is done with deliberation and care, and is not a 
casual occurrence.
  This safety valve also applies to fears about risks of default. 
Should outlays exceed receipts and if our country were faced with a 
situation where we were in danger of not being able to pay interest on 
our debt, Congress could respond with a three-fifths vote to increase 
the debt. However, this dilemma could be avoided if Congress and the 
President followed the tenets of the amendment and actually balance the 
budget, or, better yet, establish a rainy day emergency fund.
  Madam President, an economist friend of mine who I had dinner with 
argued passionately that we should not be concerned about the debt 
because after all it is money that we owe ourselves. After all, the 
interest is paid on Treasury bonds, so reduced to its essentials, it is 
money that is recirculated in other ways. I do not dispute that point. 
However, it seems to me that recycling large and growing amounts of 
taxpayer money to bondholders represents a real problem that we ought 
to face up to, as well. We are putting off the books and out of 
Congress' control, scarce resources which are then no longer available 
for our national priorities.
  My friend also argues, further, that the balanced budget amendment 
does not allow for capital investment. Again, while most States that 
have a balanced budget amendment do provide for a separate capital 
budget, the balanced budget amendment that we are considering here 
today does not preclude Congress from enacting capital budgeting at the 
Federal level.
  Another criticism is that should a three-fifths vote be necessary, it 
would be difficult for Congress to obtain the votes to address 
emergencies. Again, the need to achieve a three-fifths vote majority is 
not a foreign concept to this Congress. In the Senate, 60 votes are 
required to invoke cloture on a bill. Sixty votes are also necessary to 
waive the enforcement provisions of the Budget Act. In each case, the 
60-vote mark is achieved or negotiations and compromise to develop an 
alternative way of proceeding.
  One might point out now the way we obtain the majority necessary to 
raise the debt is for both parties to get the votes from their Members. 
Taking out partisanship is no less necessary under a 60-vote margin. On 
the important issue of approving more debt, three-fifths is large 
enough to assure the decision is made with due deliberation but not so 
large that a minority in either House can deadlock the Government.
  Critics also claim that a balanced budget amendment poses enforcement 
problems, and I will for a moment address that. For instance, there are 
fears that disputes would go to the courts. I believe that elevating 
the balanced budget amendment requirement to constitutional status 
will, in and of itself, be enough to guarantee that it will be upheld. 
Every Member of this Congress has taken an oath to uphold the 
Constitution of the United States. The American people expect, as they 
have every right to, that the officials to whom they entrust the 
Constitution will not betray that public trust.
  Nor, however, do I believe that the amendment will unduly involve the 
Federal judiciary in matters of fiscal policy. Senate Joint Resolution 
1 provides ``the Congress shall enforce and implement this article by 
appropriate legislation * * *'' In other words, Congress is directed to 
enact legislation to make the amendment work. That can include, if 
necessary, actions to limit the remedies a court could grant in a case 
brought under the balanced budget amendment.
  In addition, the courts have already developed a number of doctrines 
which will limit the type and the number of lawsuits which may be 
brought under the act. First and foremost, all litigants must have 
standing in order to bring a claim. This generally requires the 
potential plaintiffs to show they have suffered an injury, in fact, 
that was caused by the alleged unlawful conduct and which is 
redressable by the courts. Courts have been extremely reluctant to 
confer standing to litigants based on their status as taxpayers. 
Furthermore, courts have a longstanding practice of avoiding 
controversies that involve a political question. So, I believe, again, 
that there are adequate safeguards to make certain that the courts do 
not take over the constitutional function of this legislature under a 
balanced budget amendment.

  Madam President, the opponents of Senate Joint Resolution 1 have a 
great many arguments to support their view that a balanced budget 
amendment is unnecessary and unwise. I do not doubt the sincerity of 
their opposition, for their ranks include a number of Senators with 
whom I usually find myself in agreement. On balance, however, I believe 
that the only way we will be able to turn the current budget trends 
around is to face reality with the help of the balanced budget 
amendment. We must honestly address the budgetary, fiscal, and social 
issues of our time without resorting to the pocketbook resources of 
future generations.
  As I stated at the outset, I am a liberal. My support of the balanced 
budget amendment is logically consistent with that definition of 
liberalism that I previously outlined, for several reasons. The 
balanced budget amendment

[[Page S1098]]

will save our ability to invest in people. It will protect our capacity 
for humane government. And the balanced budget will help expand 
people's opportunities. It is good policy and it is an idea whose time 
has come.
  Madam President, every generation of Americans has been able to 
address and resolve challenges unique to their time. That is what makes 
this country great. Our current fiscal challenges are daunting, but I 
am convinced that passage of this amendment will preserve our 
Government's ability to act to face our underlying budget problems--
honestly and directly--and save our ability to invest in people.
  Passing a balanced budget amendment will not prevent the Government 
from acting to help address problems, and working to create expanded 
opportunities for Americans. It will mean that we will not abandon our 
responsibility to help educate our children, to assist the poor in 
moving into the economic mainstream, to protect our environment, or to 
exercise leadership in any number of areas of important public policy. 
Balancing the budget may be the critical element in our efforts to 
preserve the American dream of a better tomorrow.
  I have no doubt but that this generation of Americans is as 
compassionate and creative and patriotic as previous generations were. 
We will be forced to make artificially draconian choices if we continue 
to spend what we do not have, and delude ourselves that debt passed on 
to future generations is not debt. The balanced budget amendment will 
force a fiscal discipline which will be the first step toward ensuring 
our generation will adequately and honestly address its needs so that 
future generations will at least have the same opportunity.
  Madam President, I yield to the Senator from Utah.
  Mr. HATCH. Madam President, I thank my distinguished colleague from 
Illinois. She may call herself a liberal, and that is fine with me. But 
she has stood up on this amendment as one of our principal cosponsors 
on the Democratic side of the floor, and that is one of the reasons 
this amendment is as good as it is and why it is a bipartisan 
amendment. I'm personally grateful to her for her courage in standing 
up for this. I think the generations will, as we pass this amendment, 
thank the distinguished Senator from Illinois for standing up and being 
willing to articulate why this is so important. So, again, I want to 
personally express my fondness for her and my feelings of what a great 
job she does on this issue and how I personally appreciate it. I have 
enjoyed her remarks. They have been right on point. I think she covered 
the issues very well and, frankly, I hope everybody in this country is 
listening to it.
  As we close, I wanted to offer just a few final remarks on today's 
debate.
  First, I would once again like to thank all those who have 
participated so far in the debate. I especially wish to congratulate 
those new Members who have made their first addresses on this important 
issue. I appreciate their participation.
  Second, I would like to add just a few additional thoughts on the 
notion of the so-called automatic stabilizers and the moderation of the 
business cycle.
  Madam President, I believe the importance of automatic stabilizers 
has been overstated.
  In her testimony before the Senate Budget Committee just last month, 
CBO Director June O'Neill responded to a question about the 
effectiveness of automatic stabilizers by citing better monetary policy 
and the Nation's move away from an agricultural based economy, with the 
inherent ups and downs that go along with agriculture, as factors at 
least as important as automatic stabilizers in minimizing recessions. 
Additionally, the move to a service economy and better inventory 
management practices has reduced the fluctuations associated with 
inventory overstocks and the factory economy.
  The global economy and greater business information and efficiency 
have also contributed to a more stable economy.
  Finally, there has been much discussion of who can take credit for 
the recent reductions in the deficit.
  I believe that, like the increases in the deficit, the credit is to 
be shared. A recent article by Jim Miller, a former OMB Director shows 
various ways credit might be shared, and I ask unanimous consent that 
that article be printed in the Record following my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. HATCH. Madam President, the fight to adopt a balanced budget 
amendment is a bipartisan one.
  I congratulate my Democrat colleagues who have argued for the 
balanced budget amendment. Their support shows that this constitutional 
amendment is a nonpartisan solution to a nonpartisan problem.

                               Exhibit 1

             [From the Washington Times, January 15, 1997]

                           (By James Miller)

               Giving Credit Where Due for Lower Deficit

       A week before the election, President Clinton announced the 
     scorecard for fiscal 1996 (which ended Sept. 31): the deficit 
     was $107 billion--lower than any time since 1981. As someone 
     who would easily take credit for a brilliant sunrise or a 
     starry night, Mr. Clinton wasted no time in claiming the 
     deficit record was the product of his ``economic plan.''
       Credits aside, the deficit record is very good news indeed. 
     More U.S. saving is available for private investment, and the 
     Federal Reserve is less likely to act in such a way as to 
     restrain the economy. Tragically, had Congress adopted the 
     budget discipline President Reagan recommended in his 1988 
     budget, the deficit would have been $108 billion and ``going 
     South'' eight years ago. Think of what spending restraint to 
     balance the budget (by 1991) would have meant for economic 
     growth in the meantime!
       But who should get the credit for the latest deficit 
     figure? Bill Clinton likes to say his tax increase did the 
     trick, although in a moment of weakness he admits he raised 
     taxes too much. He also emphasizes his ``cuts'' in spending, 
     although in the package ultimately enacted most of the 
     claimed slowdown in spending growth takes place after 1996. 
     Is the Clinton economic plan of 1993 responsible for the 
     decline in the deficit?
       It's especially helpful to focus on the outcomes in two 
     fiscal years, two years apart, reflecting two Congresses: 
     1994 and 1996, the first being the product of a Democratic 
     Congress, and the latter of a Republican Congress.
       In April 1993, soon after taking office, Mr. Clinton 
     proposed a budget for 1994 that forecast a 9.2 percent 
     increase in receipts--from an estimated $1,146 billion for 
     1993 to $1,251 billion. The latter figure included $36 
     billion in additional taxes from his economic plan (``A 
     Vision of Change for America'') announced two months earlier. 
     Actual receipts in 1994 were $1,258 billion--$7 billion more 
     than the initial forecast, and an increment due to the 
     economic boost attributable to further spending restraint 
     (see below). In the budget, Mr. Clinton proposed a 3.2 
     percent increase in outlays--from an estimated $1,468 billion 
     to $1,515 billion, the latter figure reflecting his plan's $5 
     billion net reduction from the spending baseline. Actual 
     outlays in 1994 were $1,461 billion--$54 billion less than 
     Mr. Clinton asked for. Clearly, the deficit reduction in 
     1994--from $255 billion (actual) to $203 billion (actual) was 
     due more to spending restraint by Congress ($54 billion) than 
     to Mr. Clinton's economic plan ($41 billion).
       In 1995, receipts were $13 billion higher than forecast, 
     such forecast reflecting $47 billion in new taxes from 
     President Clinton's economic plan. Outlays were within $1 
     billion of Mr. Clinton's request, which reflected an $18 
     billion reduction from the baseline due to his economic plan. 
     The actual deficit fell from $203 billion to $164 billion, 
     and in this instance one can argue that Mr. Clinton's 
     economic plan is the major factor.
       In February 1995, President Clinton submitted his budget 
     for 1996. In it, he forecast a 5.2 percent increase in 
     receipts--from $1,346 billion to $1,416 billion, the latter 
     figure reflecting a $54 billion increase due to his economic 
     plan. Actual receipts, announced a week before the election, 
     were $1,453 billion--$37 billion more than forecast, arguably 
     attributable to Congress' additional budget restraint (see 
     below). In that same budget, Mr. Clinton proposed a 4.7 
     percent increase in outlays--from $1,539 billion to $1,612 
     billion, the latter figure reflecting a $34 billion reduction 
     from the spending baseline due to passage of his economic 
     plan. Actual outlays were $1,560 billion--$52 billion less 
     than Mr. Clinton asked for. Thus, the sizable reduction in 
     the actual deficit in 1996--from $614 billion to $107 
     billion--was due to additional spending restraint by Congress 
     ($52 billion) as well as the combined effects of the spending 
     restraint and the new taxes in President Clinton's original 
     economic plan ($88 billion).
       Thus, if you give President Clinton all the credit for the 
     forecast changes due to his economic plan, he accounts for 
     $194 billion of reduction from the baseline deficit over the 
     three fiscal years, whereas Congress deserves credit for at 
     least $107 billion because of further spending restraint. If 
     you give Congress credit for the $57 billion revenue boost in 
     1996 (see below), Congress can claim credit for $164 billion 
     in deficit reduction. If you give Mr. Clinton credit only for 
     the tax portion of the plan (his negotiations with Congress 
     focused on its demand for spending restraints vs. his demand 
     for tax increase), Mr.

[[Page S1099]]

     Clinton's contribution is only $137 billion; Congress 
     accounts for the rest--$221 billion.
       Of further interest here is that, contrary to the rhetoric 
     over alleged excesses of the (104th) Republican Congress in 
     paring programs indiscriminately, its record on spending in 
     its first year was almost precisely the same as that of the 
     first year of the last (103rd) Democratic Congress--both gave 
     the president some $50 billion less than he asked.
       Receipts in 1994 (and 1993) were close to forecast. But 
     what explains the substantially larger-than-forecast receipts 
     in 1996? If the stock and bond markets are any guide, the 
     determination expressed by the new Republican majorities in 
     the House and Senate to balance the budget by restraining 
     spending improved the economic outlook and was responsible 
     for the better-than-expected economic performance during the 
     last fiscal year (3 percent real growth vs. 2.5 percent 
     forecast) which in turn led to higher federal receipts.

                EFFECTS ON DEFICIT: CLINTON VS. CONGRESS
                        [In billions of dollars]
------------------------------------------------------------------------
                                          Fiscal years--
                                     ------------------------ Cumulative
                                       1994    1995    1996
------------------------------------------------------------------------
Clinton tax increase................     -36     -47     -54        -137
Clinton spending restraint..........      -5     -18     -34         -57
Congressional revenue increase......      -7     -13     -37         -57
Congressional spending restraint....     -54      -1     -52        -107
------------------------------------------------------------------------

                                                              

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