[Congressional Record Volume 143, Number 15 (Friday, February 7, 1997)]
[Senate]
[Pages S1126-S1130]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
BALANCED BUDGET AMENDMENT TO THE CONSTITUTION
The Senate continued with consideration of the resolution.
Mr. ASHCROFT addressed the Chair.
The PRESIDING OFFICER (Mr. Thomas). The Senator from Missouri is
recognized.
Mr. ASHCROFT. I thank my colleague from the State of Connecticut. Mr.
President, I am pleased to have an opportunity to make some remarks
about the balanced budget amendment. It is my understanding the
minority leader may come to the floor to speak, and if he does I am
happy to interrupt my remarks to provide him an opportunity to make
whatever remarks he plans to make.
Mr. President, when we discuss the balanced budget amendment, we are
usually talking about the impact of runaway spending on our economy or
on our future. These are fundamental considerations, but I think there
is another consideration that we must not lose sight of, and that is,
perhaps, more fundamental and more profound than the economic
implications of the balanced budget. A protracted deficit spending
empowers the central Government with the means to undermine our basic
liberties. What I really mean to say is that unlimited spending by
Government promotes unlimited Government, and unlimited Government
means limited freedom. There is a relationship between the size of
Government and the number of its prerogatives and the size of
individuals and the number of their prerogatives.
For how we tax and spend, really, in fact, determines whether we are
prosperous or poor, free or enslaved, good or evil. I believe if we
want to be free, we have always to be careful about the size of
Government.
Now, the acknowledgment that we can control Government by controlling
its power of the purse is not new. From the very beginnings of this
Republic there has been a clear understanding that if you could control
the purse, if you could limit spending, you could limit the
encroachment of Government upon the freedom of individuals. Money is
and money has always been the source of Government's most basic power.
History bears testament to this truth.
The Magna Carta, which was signed grudgingly by King John a few
centuries ago--I might add, no relation, King John, but the name is
still in current use--prescribed that the monarchy could not impose
taxes, and King John grudgingly signed this, the monarchy could not
impose taxes without the consent of the Great Council. Charles I was
executed because he tried to spend money without the consent of the
Commons. And our own Declaration of Independence talks of injuries and
usurpations, not the least of which was George III's imposition of
taxes without representation, taxes without the consent or
participation in the decisionmaking by colonial residents.
Mr. President, deficit spending has wrested power from the people. It
has taken power from the next generation and brought it to this
generation, the power to decide how the resources of our own children
will be spent. It has deposited this power in the Halls of Congress.
We are not only taking the freedom of this generation when we spend
in deficit, we are taking the freedom of the next generation, so that
we have a compound problem here. The extent and reach of Government
encroaches upon the capacity of individuals to live freely, not only in
the present time but because we are funding this overreaching of
Government with deficit spending, it encroaches upon the freedom of the
next generation.
This is an inversion of the will of the Framers of the Constitution.
It is an invasion of the social contract in which our forefathers
developed this country. It takes the power from the people and puts it
in the hands of the Congress. And really what Congress' enterprise
ought to be is empowering people. It is time to return to the people
the ability to control their own lives, their future and their destiny
and to begin to assure the next generation that we will not have
exercised their prerogatives, we will not have made their choices about
how to spend their resources, but that we will, indeed, protect some of
that prerogative which they rightfully have which they ought to enjoy.
Another way of saying this is that it is simply immoral to tax unborn
generations of Americans in anticipation of their existence in order to
satisfy our undisciplined consumption that is a result of deficit
spending.
Mr. President, Congress today does not have to vote to raise more
revenue in order to spend more money. We have gone through a transition
from tax and spend, which is an arguable proposition, to borrow and
spend, which is certainly a very questionable proposition. We now are
in a category of steal and spend, because borrowing without the
intention or capacity to pay back by those who are doing the borrowing
is something that is categorized in the law as something far different
from borrowing. People who go to borrow without the intention to pay
back are stealing. Most State statutes call it stealing by deceit. When
we in this generation borrow without the intention or capacity to repay
those moneys which we have borrowed, we, in fact, are stealing from the
next generation. We cannot have their consent to take their resources
because they do not exist yet. We are taking resources from our
children and grandchildren at a time before they are even born. We are
borrowing without the intention to pay back. We have gone from tax and
spend to borrow and spend, and I daresay, now we find ourselves in the
moral reprobate position of stealing from the next generation to spend.
I spent some time as attorney general of my State. I had the
privilege of serving the people of Missouri for 8 years as attorney
general. It is the attorney general's responsibility to uphold the
convictions of individuals who have violated the law. Among those are
people who abuse children. I think child abuse is reprehensible. It is
beyond my comprehension how someone would abuse a child, let alone his
or her own child.
But most of the people who abuse children would not think of stealing
from children, or stealing from their own children. I find it to be
abhorrent and immoral, and it is very unwise that we would take from
our own children the capacity that they ought to have to be free, and
that we would somehow wrest from them the decisionmaking capacity of
free citizens in the next generation to decide how to deploy the
resources that they generate. We would have already made the decisions,
we would already have consumed the benefits, and we would send to them
nothing more nor less than the bill--the debt to be paid.
We owe our children so much more than that. Tax and spend was bad;
borrow and spend was worse. When we got to a situation where we could
not repay that which we had borrowed, it became stealing by deceit, and
steal and spend is morally reprehensible and must be curtailed, it must
be stopped.
The ability to take resources of the next generation is unique to the
Congress. No father can create debts which are visited upon his or her
son or daughter. No mother can create a debt that can be visited upon
her son or daughter. The law simply does not allow the debts of a
parent to be imposed upon a child. Only in one universe can this
happen, and it can only happen when the people of this country, through
their Congress, create a debt which will be visited on those who are
yet unborn, will be used as a set-off to garnishee the wages that are
yet unearned. It's time that we stop.
[[Page S1127]]
No family in America finds its children encumbered by the debts of
parents. The American people are fed up with a Congress that spends
these yet unearned wages of the next generation, and rightly so. It is
more than economics; it is a matter of freedom. Second it is more than
freedom; it is a matter of integrity.
Mr. President, deficit spending is not only a threat to our posterity
and our children's future, it is a method by which Washington's elite
circumvent the public, the law, and the Constitution. When the people
express the belief that Government is out of control, they are correct.
For too long, this body has satisfied the appetites of narrow interests
at the public's expense. Where is the accountability to taxpayers?
Where is the will to do that which is right?
Mr. President, we have tried time and time again to deal with this
problem of recurring chronic debt. In terms of the medical profession,
this is not an acute problem that lasts momentarily and then is gone,
this is a chronic problem. These copies of out-of-balance budgets for
the United States, year after year--I believe there are only 28 years
stacked here. Over the last 60 years, you can more than double, perhaps
triple, the volume represented by these out-of-balance budgets. They
represent the absence of our capacity to discipline ourselves to stop
spending someone else's money, to stop borrowing someone else's money,
to stop stealing by deceit the resources of the next generation.
In 1985, we tried something. It was a noble endeavor. To be commended
are Senators Gramm, former Senator Rudman, and Senator Hollings in the
Gramm-Rudman-Hollings Act. Then again we didn't have the will to carry
through, and we changed the law so we could change the rules because we
could not change our habits. We put Gramm-Rudman II in place in 1987.
Then we changed the law and we changed the rules because we could not
change our habits and broke that agreement. When the Budget Enforcement
Act of 1990 went into effect, again, we found ourselves changing the
law and the rules because we could not break our habit. It becomes
apparent to me that we need to do more than just have laws and rules,
because we never have been able, in the face of our bad habit, to
maintain our commitment to the rules or to the laws. We have simply
changed the law and broken the rules because we could not break the
habit.
We need systemic change, something that goes to the very heart of us,
that forbids this insistent expropriation, taking away from the next
generation. It is simply that we need to put into the Constitution an
immutable, unchangeable document, a kind of capacity to provide the
discipline we have lacked and lacked consistently. I think we need to
summon the discipline to restrain Government. It is obvious that
Republican and Democrat Congresses have not had it. Republican and
Democrat Presidents have not had it. It is time for us to provide a
backbone implant, if you will, for the Congress of the United States to
place in the Constitution of the United States this discipline.
While one Senate cannot bind the next Senate, and hasn't because we
have changed the laws and changed the rules because we could not break
the habit, our Constitution can provide that discipline. Persons born
in 1900 paid, roughly, 24 percent of their income in Federal and local
net taxes. Persons born in 1970 will pay about 34 percent of their
income in net taxes. If the policies that we have in place now remain,
persons born in 1994 and thereafter will find themselves, over the
course of their lifetimes, paying a net tax rate of about 84 percent.
It is a trend which cannot continue. It is taxation without
representation. It is an expropriation of the freedom and opportunity
of the next generation. It is immoral, it is obscene, and it must end.
As Thomas Jefferson stated in a letter to James Madison in 1789:
The question whether one generation of men has a right to
bind another * * * is a question of such consequence as not
only to merit discussion, but place also, among the
fundamental principles of every government.
We must place it among the fundamental principles of our Government
by enshrining the balanced budget amendment in our Constitution.
Now, there is some quibbling about whether those who founded this
great Nation would have wanted the balanced budget amendment in the
Constitution. I must say to you that there were certain presumptions
that surrounded most individuals who assembled to create the finest
document ever written by human hand--the U.S. Constitution. One
presumption was the presumption of integrity and the presumption of
responsibility that the Founders expected of those in Government.
Tragically, that presumption is unwarranted as it relates to the
Congress today. I believe, absent their ability to rely upon the
integrity and determination of the Congress, they would gladly have
placed in the Constitution a framework which would have required such
responsibility.
Mr. President, I send to the desk for inclusion into the Record the
letter of Thomas Jefferson to James Madison, written in Paris on
September 6, 1789.
I ask unanimous consent that it be printed in the Record following my
remarks.
The PRESIDING OFFICER. Without objection, it is so ordered.
(See exhibit 1.)
Mr. ASHCROFT. Mr. President, during this debate, we have heard
frequently that there is not a need to amend the Constitution. There is
authority, we are told, for Congress to do what is right if we simply
exercise greater fiscal discipline. No one in this Chamber has ever
argued that there is inadequate authority for balancing the budget. But
these unbalanced budgets are a testimony which is undeniable, not to
the absence of authority, but to the absence of discipline. It is time
that we, who have experienced a collective loss of will, provide a
structure in which we cannot allow this abuse of the future of the
United States to continue.
The balanced budget amendment is real reform, and it will be felt. I
had the privilege of serving my State as Governor. I have seen what
happens when there is a framework and structure which demands
discipline. I know that for 8 years we balanced our budgets. As a
matter of fact, we aimed for a little surplus so we could create a
rainy day fund so that when times got tough, we could simply call upon
those resources that we had developed when times were good. And it was
not only an appropriate way to do business because it was moral and
because it didn't steal from the next generation. It was an appropriate
way to do business because it was very healthy for the State
economically. And over and over again our State was rated at the very
top with the highest bond rating--the highest financial rating of any
State in the country because it was understood that we had this concern
about the integrity of our fiscal affairs.
So, Mr. President, let me just say a balanced budget amendment is
real reform. It will reestablish the historical responsibilities
observed in this country that we could have balanced budgets, except in
times of war, which is something that should be assumed. But it cannot
be assumed and must be institutionalized.
It is also a political reform that will be felt first and foremost in
the cold corridors of power here on the Potomac. Most importantly, it
will be felt by the American people who will have their right to self-
governance restored.
Over two centuries ago Edmund Burke reminded members of the British
House of Commons of a fundamental principle. Burke said: ``The people
must possess the power of granting their own money or no shadow of
liberty can subsist.''
The truth of the matter is that, if the people do not have power over
their own purse strings and if we can extend our Republic of Government
by borrowing or stealing from the next generation, we indeed will have
seriously eroded the liberty which we are entitled to in this country.
We need to safeguard those liberties which were first inscribed in
the Magna Carta in 1215 preserved by the blood of patriots on
continents around the world. We must return the power of the purse to
the people. We must stop stealing from our children. We must stop
stealing by deceit.
Mr. President, the balanced budget amendment to the Constitution not
only has to do with economics and the economy, and not only has to do
with
[[Page S1128]]
prosperity. It is a problem about integrity, and it is a challenge
relating to liberty. And we must embrace it and offer it to the people
of the United States for ratification.
Exhibit 1
letter from thomas jefferson to james madison, paris September 6, 1789
Dear Sir: I sit down to write to you without knowing by
what occasion I shall send my letter. I do it because a
subject comes into my head which I would wish to develop a
little more than is practicable in the hurry of * * * of
making up general dispatches.
The question Whether one generation of men has a right to
bind another, seems never to have been started either on this
or our side of the water. Yet it is a question of such
consequences as not only to merit decision, but place also,
among the fundamental principles of every government. The
course of reflection in which we are immersed here on the
elementary principles of society has presented this question
to my mind; and that no such obligation can be so transmitted
I think very capable of proof.--I set out on this ground,
which I suppose to be self evident, `that the earth belongs
in usufruct to the living': that the dead have neither powers
nor rights over it. The portion occupied by any individual
ceases to be his when himself ceases to be, and reverts to
the society. If the society has formed no rules for the
appropriation of it's lands in severality, it will be taken
by the first occupants. These will generally be the wife and
children of the decendent. If they have formed rules of
appropriation, those rules may give it to the wife and
children, or to some one of them, or to the legatee of the
deceased. So they may give it to his creditor. But the child,
the legatee, or creditor takes it, not by any natural right,
but by a law of the society of which they are members, and to
which they are subject. Then no man can, be natural right,
oblige the lands he occupied, or the persons who succeed him
in that occupation, to the paiment of debts contracted by
him. For if he could, he might, during his own life, eat up
the usufruct of the lands for several generations to come,
and then the lands would belong to the dead, and not to the
living, which would be the reverse of our principle.
What is true of every member of the society individually,
is true of them all collectively, since the rights of the
whole can be no more than the sum of the rights of the
individuals.--To keep our ideas clear when applying them to a
multitude, let us suppose a whole generation of men to be
born on the same day, to attain mature age on the same
day, and to die on the same day, leaving a succeeding
generation in the moment of attaining their mature age all
together. Let the ripe age be supposed of 21. years, and
their period of life 34. years more, that being the
average term given by the bills of mortality to persons
who have already attained 21. years of age. Each
successive generation would, in this way, come on, and go
off the stage at a fixed moment, as individuals do now.
Then I say the earth belongs to each of these generations,
during it's course, fully, and in their own right. The 2d.
generation receives it clear of the debts and
incumberances of the 1st. the 3d of the 2d. and so on. For
if the 1st. could charge it with a debt, then the earth
would belong to the dead and not the living generation.
Then no generation can contract debts greater than may be
paid during the course of it's own existence. At 21. years
of age they may bind themselves and their lands for 34.
years to come: at 22. for 33: at 23. for 32. and at 54.
for one year only; because these are the terms of life
which remain to them at those respective epochs.--But a
material difference must be noted between the succession
of an individual, and that of a whole generation.
Individuals are parts only of a society, subject to the
laws of the whole. These laws may appropriate the portion
of land occupied by a decedent to his creditor rather than
to any other, or to his child on condition he satisfies
the creditor. But when a whole generation, that is, the
whole society dies, as in the case we have supposed, and
another generation or society succeeds, this forms a
whole, and there is no superior who can give their
territory to a third society, who may have lent money to
their predecessors beyond their faculties of paying.
What is true of a generation all arriving to self-
government on the same day, and dying all on the same day, is
true of those in a constant course of decay and renewal, with
this only difference. A generation coming in and going out
entire, as in the first case, would have a right in the
1st. year of their self-dominion to contract a debt for
33. years, in the 10th. for 24. in the 20th. for 14. in
the 30th for 4. whereas generations, changing daily by
daily deaths and births, have one constant term, beginning
at the date of their contract, and ending when a majority
of those of full age at that date shall be dead. The
length of that term may be estimated from the tables of
mortality, corrected by the circumstances of climate,
occupation &c. peculiar to the country of the contractors.
Take, for in stance, the table of M. de Buffon wherein he
states 23,994 deaths, and the ages at which they happened.
Suppose a society in which 23,994 persons are born every
year, and live to the ages stated in this table. The
conditions of that society will be as follows 1st. It will
consist constantly of 617,703 persons of all ages. 2ly. Of
those living at any one instant of time, one half will be
dead in 24. years 8. months. 3dly. 10,675 will arrive
every year at the age of 21. years complete. 4ly. It will
constantly have 348,417 persons of all ages above 21.
years. 5ly. And the half of those of 21. years and upwards
living at any one instant of time will be dead in 18.
years 8. months, or say 19. years as the nearest integral
number. Then 19. years is the term beyond which neither
the representatives of a nation, nor even the whole nation
itself assembled, can validly extend a debt.
To render this conclusion palpable by example, suppose that
Louis XIV. and XV. has contracted debts in the name of the
French nation to the amount of 10,000 milliards of livres,
and that the whole has been contracted in Genoa. The interest
of this sum would be 500. milliards, which is said to be the
whole rent roll or nett proceeds of the territory of France.
Must the present generation of men have retired from the
territory in which nature produced them, and ceded it to the
Genoese creditors? No. They have the same rights over the
soil on which they were produced, as the preceding
generations had. They derive these rights not from their
predecessors, but from nature. They then and their soil
are by nature clear of the debts of their predecessors.
Again suppose Louis XV, and his cotemporary generation had
said to the money-lenders of Genoa, give us money that we may
eat, drink, and be merry in our day; and on condition you
will demand no interest till the end of 19 years you shall
then for ever after receive an annual interest of 12\5/8\ per
cent.\1\ The money is lent on these conditions, is divided
among the living, eaten, drank, and squandered. Would the
present generation be obliged to apply the produce of the
earth and of their labour to replace their dissipations? Not
at all.
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\1\ 100, at a compound interest of 5. per cent,
makes at the end of 19. years, an aggregate of principal and
interest of 252-14, the interest of which is
12 12-12s-7d which is nearly 12\5/8\ per cent on
the first capital of 100. .
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I suppose that the received opinion, that the public debts
of one generation devolve on the next, has been suggested by
our seeing habitually in private life that he who succeeds to
lands is required to pay the debts of his ancestor or
testator: without considering that this requisition is
municipal only, not moral; flowing from the will of the
society, which has found it convenient to appropriate lands,
become vacant by the death of their occupant, on the
condition of a paiment of his debts: but that between society
and society, or generation and generation, there is no
municipal obligation, no umpire but the law of nature. We
seem not to have perceived that, by the law of nature, one
generation is to another as one independant nation to
another.
The interest of the national debt of France being in fact
but a two thousandth part of it's rent roll, the paiment of
it is practicable enough: and so becomes a question merely of
honor, or of expediency. But with respect to future debts,
would it not be wise and just for that nation to declare, in
the constitution they are forming, that neither the
legislature, nor the nation itself, can validly contract
more debt than they may pay within their own age, or
within the term of 19 years? And that all future contracts
will be deemed void as to what shall remain unpaid at the
end of 19 years from their date? This would put the
lenders, and the borrowers also, on their guard. By
reducing too the faculty of borrowing within it's natural
limits, it would bridle the spirit of war, to which too
free a course has been procured by the inattention of
money-lenders to this law of nature, that succeeding
generations are not responsible for the preceding.
On similar ground it may be proved that no society can make
a perpetual constitution, or even a perpetual law. The earth
belongs always to the living generation. They may manage it
then, and what proceeds from it, as they please, during their
usufruct. They are masters too of their own persons, and
consequently may govern them as they please. But persons and
property make the sum of the objects of government. The
constitution and the laws of their predecessors [are]
extinguished then in their natural course with those who gave
them being. This could preserve that being till it ceased to
be itself, and no longer. Every constitution then, and every
law, naturally expires at the end of 19 years. If it be
enforced longer, it is an act of force, and not of right.--It
may be said that the succeeding generation exercising in fact
the power of repeal, this leaves them as free as if the
constitution or law had been expressly limited to 19 years
only. In the first place, this objection admits the right, in
proposing an equivalent. But the power of repeal is not an
equivalent. It might be indeed if every form of government
were so perfectly contrived that the will of the majority
could always be obtained fairly and without impediment. But
this is true of no form. The people cannot assemble
themselves. Their representation is unequal and vicious.
Various checks are opposed to every legislative proposition.
Factions get possession of the public councils. Bribery
corrupts them. Personal interests lead them astray from the
general interests of their constituents: and other
impediments arise so as to prove to every practical man
that a law of limited duration is much more manageable
than one which needs a repeal.
This principle that the earth belongs to the living, and
not to the dead, is of very extensive application and
consequences, in every country, and most especially in
France. It enters into the resolution of the
[[Page S1129]]
questions. Whether the nation may change the descent of lands
holden in tail? Whether they may change the appropriation of
lands given antiently to the church, to hospitals, colleges,
orders of chivalry, and otherwise in perpetuity? Whether they
may abolish the charges and privileges attached on lands,
including the whole catalogue ecclesiastical and feudal? It
goes to hereditary offices, authorities and jurisdictions; to
hereditary orders, distinctions and appellations; to
perpetual monopolies in commerce, the arts and sciences; with
a long train of et ceteras: and it renders the question of
reimbursement a question of generosity and not of right. In
all these cases, the legislature of the day could authorize
such appropriations and establishments for their own time,
but no longer; and the present holders, even where they, or
their ancestors, have purchased, are in the case of bona fide
purchasers of what the seller had no right to convey.
Turn this subject in your mind, my dear Sir, and
particularly as to the power of contracting debts; and
develope it with that perspicuity and cogent logic so
peculiarly yours. Your station in the councils of our country
gives you an opportunity of producing it to public
consideration, of forcing it into discussion. At first blush
it may be rallied, as a theoretical speculation: but
examination will prove it to be solid and salutary. It would
furnish matter for a fine preamble to our first law for
appropriating the public revenue; and it will exclude at the
threshold of our new government the contagious and ruinous
errors of this quarter of the globe, which have armed despots
with means, not sanctioned by nature, for binding in
chains their fellow men. We have already given in example
one effectual check to the Dog of war by transferring the
power of letting him loose from the Executive to the
Legislative body, from those who are to spend to those who
are to pay. I should be pleased to see this second
obstacle held our by us also in the first instance. No
nation can make a declaration against the validity of
long-contracted debts so disinterestedly as we, since we
do not owe a shilling which may not be paid with ease,
principal and interest, within the time of our own
lives.--Establish the principle also in the new law to be
passed for protecting copyrights and new inventions, by
securing the exclusive right for 19, instead of 14, years.
Besides familiarising us to this term, it will be an
instance the more of our taking reason for our guide,
instead of English precedent, the habit of which fetters
us with all the political heresies of a nation equally
remarkeable for it's early excitement from some errors,
and long slumbering under others.
I write you no news, because, when an occasion occurs, I
shall write a separate letter for that, I am always with
great & sincere esteem, dear Sir Your affectionate friend &
servt.
Mr. ASHCROFT. Mr. President, I note the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. DASCHLE. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DASCHLE. Mr. President, today we begin the debate about the
budget resolution. As everyone knows, yesterday the President sent to
Congress his plan for a balanced budget. The way we receive that budget
will be the first real test of our ability and our willingness in this
Congress to find bipartisan consensus on a budget.
Is bipartisanship truly our goal, or is it merely a PR strategy? The
debate that begins today will go a long way on both sides of the aisle
toward answering that question.
The plan the President is sending us balances the Federal budget by
the year 2002 while protecting our priorities. It invests in America's
future, and pays for those investments.
The President's budget offers targeted tax relief for homeowners and
families with children; for parents who are struggling to save for
their children's college education, and workers who are trying to save
for their own retirement; for companies involved in environmental
cleanup and converting old industrial sites into new hubs of
opportunity.
The budget provides a strong framework for a bipartisan agreement. It
reflects 2 years of hard negotiations, and contains ideas advocated by
both parties.
With the requisite sense of purpose and political will, this Congress
can enact a balanced budget that protects important national priorities
this year. That is my goal, and I am committed to making it happen.
It does not take a miracle to balance the budget. I know. I helped
write a plan last year that balanced the budget by the year 2002--and
protected Medicare, education, and the environment. I voted for it. And
so did a lot of other people.
The President adopted the plan. And the President is submitting a
modified version of that very plan today. So he knows it does not take
a miracle to balance the budget. The President has shown us a blueprint
that will allow us to make that a reality.
It also doesn't require a constitutional amendment. The President's
budget will balance the budget by the year 2002 without it.
But let me be clear. I support a balanced budget amendment. I have
since I was first elected to Congress. I have voted for amendments in
the past. I have opposed other amendments. And I will support a
balanced budget amendment again this year.
But it has to be the right amendment. There is a difference between
supporting a responsible amendment and supporting any balanced budget
amendment.
Senator Dorgan and I and others are cosponsoring an amendment that
requires Congress to pass a balanced budget without looting the Social
Security trust funds.
The version of the amendment now before the Senate contains no such
protection.
It places current retirees in the most immediate danger. Let me read
a letter from the President that I received just last week. In that
letter the President states:
In the event of an impasse in which the budget requirements
can neither be waived nor met, disbursement of Social
Security checks could cease or unelected judges could reduce
benefits to comply with this constitutional mandate.
That was a letter from the President just last week.
Social Security has never been a day late or a dollar short. The
amendment should not force us to break that historic contract.
This version of the amendment also places future retirees at risk.
The heart of the 1983 bipartisan agreement that rescued Social Security
was a plan to set aside funds for baby boomers' retirement. Because of
that plan, Social Security is now running huge surpluses. This year
alone that surplus is expected to be $78 billion. By the year 2002, it
is expected to be $104 billion. By 2019, when many of the baby boomers
start to retire, the Social Security trust funds will have built up a
$3 trillion surplus, which will be absolutely necessary to pay the
retirees at that time.
But, if we pass this version of the balanced budget amendment, none
of those funds will be available to pay the Social Security benefits.
This amendment says clearly, ``Total outlays for any fiscal year
shall not exceed total receipts for that year.'' Total outlays,
including Social Security.
The Government would be forbidden not only from running a deficit,
but also from drawing down the surplus.
Social Security benefits could be paid only from taxes raised in the
same year. That means, when the baby boomers retire, Congress would
have to raise taxes dramatically, or slash Social Security benefits
deeply--or both.
In addition, this version of the amendment cheats working families.
American workers are paying more in payroll taxes today than is
needed to cover the Social Security checks that go out. The surplus
revenues are supposed to be set aside to meet their future retirement
needs. If we pass this amendment without exempting Social Security, the
Government cannot save those tax dollars to pay for future Social
Security needs of the baby boomers. Instead, the money will be diverted
to other Government programs, to everything from highways to salaries
of Members of Congress.
More than half of American taxpayers, 58 percent, pay more in Social
Security taxes than they do in income tax. These taxes place a
disproportionately heavy burden on low and moderate-income families. It
is justifiable to levy these taxes if they are truly set aside for
Social Security, but it is inexcusable if they are used to pay for
general Government operations. The Congress should not enshrine this
abuse of the payroll tax in the U.S. Constitution.
The amendment that is before the Senate contains another flaw that I
will seek to change. It would limit in perpetuity how Congress can
treat capital investments in our future economic growth. If this
amendment
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passes, any proposal to create a capital budget would be declared
unconstitutional. A capital budget would allow us to differentiate
between investments and operating costs like every single State in the
country.
If we were to ask any Governor today, do you have a capital budget,
the answer is ``yes.'' If we would ask any Governor today, if you had
to work under the same accounting devices that we do at the Federal
level, a unified budget, would you have a balanced budget, chances are
in every single case the answer would be, ``no, we would have a
deficit.'' We would have a large deficit, billions of dollars of
deficit. Why? Because for many, many years, in some cases from the very
beginning of a State's history, they have known the importance of
differentiating between capital investments and operating costs,
knowing that you do not treat an investment long term like you do
somebody's lunch.
I think it is very important for this country to differentiate in
that regard at some point in the future as well. And for us at this
date, regardless of how one feels about a capital budget, to say that
from here on out we are going to make it unconstitutional for this
country to even consider budgeting the way we do in business, the way
we do in families, the way we do in States, in my view is
extraordinarily dangerous to this country's economic health and well-
being.
How many times have we heard on this Senate floor the following
phrase: this Government ought to budget its expenditures the way a
family does. We ought to treat our budget the way every single family
treats its budget.
Mr. President, there are not many families I know of that pay off
their mortgage in 1 year. How many families today say that they have a
balanced budget, taking into account the mortgage that they themselves
must pay? Few families today would have the ability to pay off a
mortgage in 1 year. But we are asking the Federal Government to pay off
every one of its mortgages in each year, to treat a mortgage the same
way we treat a bill for the lights which run this building.
There is a big difference, and I think the time has come for this
country to have a capital budget. Regardless, as I say, the real
question is, should we have an accounting system like families, like
businesses, like States? I hope the answer is ``yes,'' someday, and I
hope we will have the foresight, regardless of what we may think of a
budgeting system of that kind, to at least say that the Senate has the
right to consider a capital budget at some point in the future. To make
it expressly unconstitutional, in my view, is extraordinary.
I ask all of my colleagues to think very carefully about the
amendment we write. I have also heard so often Senators come to the
floor and say this bill is not perfect; this amendment is not the best
we can do, but let us accept the fact that we can improve on it at some
point in the future.
I hope no one in this entire debate will ever come to the floor and
say this bill is not perfect, this amendment to the U.S. Constitution
may not be perfect, because we do not have the luxury of coming back
and amending it. We do not have the luxury of altering it once it
becomes part of the U.S. Constitution. We tried that once before with
prohibition, and it took another constitutional amendment to undo the
damage we did the first time.
So let us not in any way, shape or form be content to satisfy our
need to pass an amendment and then say we are willing to accept
something that is imperfect. We have imperfections in this amendment
that have to be dealt with. There is absolutely no reason to pay for
deficit spending with Social Security trust funds. There is no reason
to constitutionally preclude us from dealing directly with the real
need to pass a capital budgeting system at some point in the future.
So let us be honest. Let us recognize that this amendment is not
perfect; it needs to be changed; it needs to be amended in a
constructive way; it needs to take into account our future; it needs to
recognize that we have to be truthful with the American people; and it
needs at long last to be dealt with in a bipartisan way, with
Republicans and Democrats working together to fashion an amendment that
makes sense not only for us but for all posterity.
Mr. President, I yield the floor and note the absence of a quorum.
The PRESIDING OFFICER (Mr. Enzi). The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. DASCHLE. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Hagel). Without objection, it is so
ordered.
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