[Congressional Record Volume 143, Number 26 (Tuesday, March 4, 1997)]
[Senate]
[Pages S1847-S1883]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

  The PRESIDING OFFICER. Under the previous order, the Senate will now 
resume consideration of Senate Joint Resolution 1, which the clerk will 
report.
  The legislative clerk read as follows:

       A joint resolution (Senate Joint Resolution 1) proposing an 
     amendment to the Constitution of the United States to require 
     a balanced budget.

  The Senate resumed consideration of the joint resolution.
  The PRESIDING OFFICER. The time until 12:30 p.m. shall be equally 
divided between the two managers. The Senator from Utah.
  Mr. HATCH. Mr. President, I am very honored to be able to turn to a 
man who has led the fight for the balanced budget amendment ever since 
he arrived at the Senate, the most senior Senator in the whole U.S. 
Senate, a person all look up to, who has been my mentor on this issue 
and so many others, and one of my dearest friends in this world, the 
distinguished Senator from South Carolina, Senator Strom Thurmond, for 
5 minutes or whatever time he needs.
  Mr. THURMOND. Mr. President, I rise today as we draw to a close the 
debate on this historic opportunity to adopt Senate Joint Resolution 1, 
the balanced budget amendment. This debate is about much more than an 
amendment to the Constitution, as significant as that is. It is about 
taking action once and for all that will control the size and scope of 
the Federal Government.
  I have been deeply concerned during my years in the Senate over the 
growth of the Federal bureaucracy. The first $100 billion budget in the 
history of the Nation occurred in 1962. This was almost 180 years after 
the Nation was founded. Yet, it took only 9 years, from 1962 to 1971, 
for the Federal budget to reach $200 billion. Then, the Federal budget 
continued to skyrocket; $300 billion in 1975, $500 billion in 1979, 
$800 billion in 1983, and the first $1 trillion budget in 1987. The 
budget for fiscal year 1996 was over $1.5 trillion.

[[Page S1848]]

  With this voracious congressional appetite for spending has come 
deficit spending. In the past three decades, the Federal Government has 
run deficits in every year except one. During the 1960's, deficits were 
averaging around $6 billion per year. The following decade, the 1970's, 
saw deficits rise an average $36 billion per year. In the last decade, 
the 1980's, deficits continued to rise and averaged $156 billion per 
year. So far, in the 1990's, deficits have averaged $259 billion per 
year. Compare this to 1957, my third year in the Senate, when the 
entire national debt was less than $275 billion and there was no 
deficit, but rather a $3 billion surplus.
  During my service here, there has never been a shortage of 
legislation creating new Federal programs or of efforts to increase 
spending in existing programs. It has been too easy for the Congress to 
pass legislation creating new Federal programs and spending more tax 
dollars whenever there is a call for Federal intervention. This Nation 
has drifted from its original foundations as a national Government of 
limited authority. A balanced budget amendment is the single most 
important addition we can propose to the Constitution to begin reducing 
the size and scope of the Federal Government.
  Mandating balanced Federal budgets is not a new idea. The first 
constitutional amendment to balance the budget was proposed in 1936. 
Since the beginning of the 84th Congress in 1955, constitutional 
amendments to require a balanced Federal budget have been proposed 
during each Congress. Finally, in 1982 while I was chairman of the 
Judiciary Committee, the Senate passed a balanced budget amendment 
which I authored. Our victory was short-lived, however, because the 
Speaker and the majority leader at that time led the movement to kill 
it in the Democrat-controlled House of Representatives. That was our 
high water mark as we fell one vote short in 1986, four votes short in 
1994, and one vote short 2 years ago. Once again, we have a historic 
opportunity to pass the balanced budget amendment and send it to the 
American people for ratification.
  I would note that today the Congress is working hard to balance the 
Federal budget. However, this is a very recent development brought 
about by a change in the control of the Congress, and by this body 
finally listening to the will of the people. We must act to instill 
legislative accountability that will not waver with the membership of 
the majority.
  Our third president, Thomas Jefferson, stated:

       The question whether one generation has the right to bind 
     another by the deficit it imposes is a question of such 
     consequence as to place it among the fundamental principles 
     of government. We should consider ourselves unauthorized to 
     saddle posterity with our debts, and morally bound to pay 
     them ourselves.

  Mr. President, it is time we make that moral obligation to pay our 
debts a constitutional one. Not only will we restore order to the 
fiscal policy of this Nation, we will be making a giant leap toward 
restoring the fundamental principle of limited authority to the Federal 
Government.
  I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, we have been considering this proposed 28th 
amendment to the Constitution of the United States since this session 
began almost 2 months ago. In fact, we have been engaged in floor 
debate for nearly 4 weeks. The distinguished Senator from Utah and I 
have begun to think we live on this floor with this debate.
  Mr. President, stop and think what we are debating--a proposed 28th 
amendment to the Constitution. The Constitution has been amended only 
17 times since the Bill of Rights. During this time, the United States 
has been through some very, very serious situations--the War of 1812, 
the Civil War, two world wars, Korea, Vietnam, the Great Depression, 
westward expansion. One would have to assume during that time, there 
have been hundreds and hundreds of times that we have seen crises in 
our Nation that, some would say, reached a constitutional magnitude. We 
know that hundreds, even thousands, of constitutional amendments have 
been proposed, but those who have gone before us have seen fit to only 
amend the Constitution 17 times--which was very wise--since the Bill of 
Rights.
  I say this because nobody in the Senate owns a seat in the Senate. We 
are only passing through, no matter how long we serve. What we ought to 
do is remember that we have a responsibility not only to those who went 
before us, but those who will come after. So during this debate, some 
of us have tried to look at the substance behind this bumper-sticker 
title and even the poll-driven politics that led to this proposal, 
again occupying the No. 1 position in the majority's legislative 
agenda.
  We have examined the resolution in our Judiciary Committee hearings, 
markup and report and during the Senate debate. We have become, and 
certainly the American people have become, more and more aware of the 
serious substantial failings in this proposal. I believe this debate 
has shown any objective observer that this resolution fails to meet the 
standards set by our founders in article V of the Constitution for its 
amendment: It cannot be found necessary by two-thirds of this Senate.
  Moreover, the proponents have failed to answer the serious questions 
raised about the various provisions over the past several weeks. They 
have failed the Byrd challenge by being unable to demonstrate what it 
means and how it would work. The distinguished senior Senator from West 
Virginia came on this floor and, in his usual careful manner, his usual 
sense of history, his usual understanding of the Constitution, asked 
the pertinent questions: How would it work? What does it mean? What 
does it do? And no answer was forthcoming. Having now had an 
opportunity to focus on the language of the resolution before us, none 
of us can be confident concerning its meaning or its use.
  During the course of this debate, we have had the principal 
proponents of the resolution concede that it does not require a 
balanced budget, but that it is intended to provide incentive to 
balance the Federal budget and exert pressure on Congress. It is 
intended just to make us do our job. That is not sufficient reason to 
amend the Constitution. As the President said in his State of the Union 
Message, we have but to vote a balanced budget, he has but to sign it 
to have a balanced budget. We do not have to tinker with the 
Constitution in a way that would actually throw the whole matter over 
to the courts, not to the President and the Congress.
  The President and Congress have shown over the past 4 years that we 
can make progress undoing the mistakes of the deficit-building decades 
of the 1980's without a proposed amendment to the Constitution. We 
succeeded in reducing the deficit in each of the last 4 years. We have 
cut the deficit by more than 60 percent. At the same time, we are 
pursuing sound economic and fiscal policies doing those things that 
have made the United States economy the strongest in the world.
  What we are now asked to do is tinker with obvious success. But more 
than that, we are asked to give people something they can put on a 
bumper sticker that says, ``I voted to balance the budget,'' when, 
indeed, it does not do that, instead of saying, ``I voted to really 
mess up the Constitution,'' which is what it would do.

  I hope that we will think not only of our political fortunes of this 
day and the political polls of our State of this moment, but think of 
the United States and think of those who will come after us.
  I reserve the remainder of my time.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I yield 10 minutes to the distinguished 
Senator from Texas.
  The PRESIDING OFFICER. The Senator from Texas is recognized.
  Mrs. HUTCHISON. Thank you, Mr. President, and I thank the 
distinguished Senator from Utah for the fine job he has done in leading 
this very important debate, because really this debate is one of the 
most defining moments of our times. Will Congress deliver a balanced 
budget? Will we set the future economic stability of our country in 
place right now? Will we win this fight that we have undertaken on 
behalf, not of ourselves, but of our future generations?

[[Page S1849]]

  The American dream has always been that a parent could wish that his 
children or her children would have a better quality of life than he or 
she has had. That is why people came to this country. They wanted to 
work harder so that they could give their children a little better 
chance in life.
  What we are fighting for is a change that will assure that we can 
keep the American dream. We are trying to make lower interest rates, a 
higher standard of living, more job opportunities, a country liberated 
from an ever-increasing debt. Our children will not have a higher 
quality of life if we continue to build on this $5 trillion debt, Mr. 
President. This debate is about our children. It is not about political 
expedience. We know what must be done. Thomas Jefferson told us. Thomas 
Jefferson said one of the two things that he was concerned about after 
the Constitution was written and adopted was that we had not provided 
for the constraints on Congress that would not allow them to spend more 
than was in the public Treasury. Jefferson said that. In fact, his 
quotes were:

       Each successive generation ought to be guaranteed against 
     the dissipations and corruptions of those preceding it.

  Mr. President, Thomas Jefferson was the greatest visionary President 
perhaps we have ever had. Even Thomas Jefferson would not have dreamed 
our country, that he worked so hard to put together, would one day have 
a $5 trillion debt.
  Even Jefferson could not have been that visionary, and thank 
goodness, because so many of his generation fought and died for this 
country to be formed. If they had thought that the stewards of our 
future would not have the guts, would not have the ability to constrain 
their spending to the tune of $5 trillion, I wonder if they would have 
fought so hard.
  The idea of saddling generation after generation of Americans with a 
suffocating debt would have been unthinkable to those honorable men.
  Some say we don't need an amendment. They say we haven't been tuned 
in. I am going to tell you something, I have been tuned in. I have been 
watching the debate on this floor. I have seen what has happened to 
Medicare reform, to Social Security reform, to welfare reform, to 
Medicaid reform. It has taken a lot to get one of those four--welfare 
reform--and we have failed on the other three. If you think we do not 
need an amendment to constrain the appetite of Congress to spend other 
people's money, you have not been tuned in.

  Some say that this is going to tie the hands of Government. 
Hallelujah. That is exactly what we want to do. We want to get big 
government out of the hard-working American's pocketbook. Most 
Americans pay 50 percent of what they earn in taxes of some kind. All 
of us want to pay our fair share. But, Mr. President, 50 percent is too 
much. That does not allow the freedom to pursue the American dream. A 
balanced budget amendment to the Constitution will cure that appetite 
because Congress will be constrained, yes, their hands will be tied, 
from getting into the pocketbooks of our children and their children.
  So, Mr. President, I think the time has come for us to do what is 
right. The greatest issues of our time have taken many years. Americans 
debated the evil of slavery from the earliest days of the Republic, but 
it was not until 1865 that the 13th amendment to the Constitution was 
ratified and slavery was abolished. Women began their fight for 
suffrage in the early 19th century, but it was 1920 when the 19th 
amendment was ratified giving women the right to vote.
  Like these two epic struggles, the balanced budget amendment has been 
fought for a long time. It is a fight we are waging on behalf of our 
children, our grandchildren, and their grandchildren. And we will not 
stop the fight. Each year we lose by a very narrow margin. Last year it 
was one vote. This year, unless someone looks up and says, ``My gosh, 
what am I doing for my children,'' and changes his or her mind, unless 
someone does that, we are going to lose again probably by one vote.
  So, Mr. President, I hope that we will not be dissuaded from 
continuing this fight, because it is worthy of the other great issues 
that have taken so long.
  It is very important that we look not to the next election, but to 
the next generation, as we are making our decision today. This 
amendment is not the panacea, but what it does is give us the 
opportunity to make sure that there is a stability in our economy for 
evermore, that no Congress of the future will be able to go into a 
deficit unless there is a war or an emergency, which there is a safety 
valve of a three-fifths vote that can unbalance the budget. Those are 
the safety valves, of course, if we are in a war or a dire emergency, 
we will do the responsible thing.
  But if we can constrain ourselves in normal times, we will have a 
stable economy. We will have lower mortgage rates, lower car payments 
rates. We will have more jobs, and we will have more expendable money 
by the hard-working people of this country if we will face the fact 
that we need to tie the hands of a government that is so big, it could 
have brought together a $5 trillion debt.
  This vote today, if we win, could be the first step in a very long 
journey, and, by doing this, we would assure that there is a 
destination to the journey, that there is a shining city on the hill 
that is America.
  If we do not have a balanced budget, and the constraints of an 
amendment that would assure that we always will, there may not be a 
destination, there may not be a shining city on the hill that is 
America because future Congresses will be able to add just a little--it 
does not seem like so much, but just a little is now $5 trillion, Mr. 
President.
  We do need to tie the hands of future Congresses so there will be 
economic stability. And, Mr. President, this Congress has the ability 
to take the first step in that long journey to put our country back on 
track so that our children will have the same American dream that we 
have had, which is that they would be able to wish for their children a 
better quality of life than they have had because each generation 
expects to be able to do better. If we have a balanced budget amendment 
to the Constitution, we will assure that that will happen.

  Mr. President, this debate is defining of our times. And I hope we 
have the will to do what is right for our children and for theirs.
  Thank you, Mr. President, and I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER (Mr. Hagel). The Senator from Vermont.
  Mr. LEAHY. Mr. President, we talk about how many votes there may be 
and we talk about this debate, which, incidentally, has been interfered 
with in some ways over the weekend, at the same time we talk about evil 
money in politics. We have seen some so-called ``independent'' 
expenditures in running ads on this. They are about as independent as 
absolutely nothing. I think it is unfortunate that apparently the 
proponents of this constitutional amendment do not feel that they can 
make their case well enough on the Senate floor. They have to do this.
  We talk about whether it is one vote or not. Let us talk about votes. 
In 1993, we started down this road to concerted, consistent deficit 
reduction. We did that without a single Republican vote in either the 
House or the Senate for the President's budget. After 12 years of ever-
larger deficits, voted for by the Republican Members of Congress, when 
we finally started cutting the deficit, not a single Republican Member 
voted to do that.
  Over the last 4 years, we have succeeded in reducing the deficit by 
63 percent. It went up for 12 years; the national debt went up. We 
started bringing the deficit down. When President Clinton took office, 
the deficit was at its highest point ever--$290 billion. Today, the 
deficit is at its lowest dollar figure since 1981, $107 billion. In 
fact, it is at the lowest point as a percentage of the economy since 
1974.
  In his testimony to the committee, Robert Greenstein of the Center on 
Budget and Policy Priorities notes that over the past 10 years the 
deficit has actually declined 70 percent as a percentage of gross 
domestic product--5.1 percent in 1986 to 1.4 percent in 1996. In fact, 
as a percentage of gross domestic product, our deficit is now at the 
lowest level of any major industrialized nation in the world. The 
deficit is at the lowest level of any industrialized nation in the 
world. We are the envy of the rest of the world. But it has taken

[[Page S1850]]

some political courage to do that. And the budgets are starting to 
bring that deficit down.
  I say to my good friends in the Republican Party, it was done without 
a single vote from their side of the aisle, notwithstanding those 
deficits grew up over 12 years of Republican administrations.
  The record of deficit reduction is an accomplishment of the Clinton 
administration. It is an accomplishment that the Clinton 
administration's policies have restored fiscal sanity and have kept the 
economy strong. The result of the recent election is testimony that the 
American people recognize these facts. In fact, were it not for the 
interest on the $2.462 trillion debt that was rung up during President 
Reagan's term and President Bush's term, our budgets over the last 
several years would already have been in balance. Just think of that. 
They ran up a debt of $2.462 trillion. The rest of the budget, 
including entitlements, is already balanced. We didn't need a 
constitutional amendment to do that. All we needed was courage. If we 
were not paying the interest on that debt run up, we would be totally 
in balance.

  This deficit progress has been achieved through tough votes over the 
last 4 years. But we have seen its impact on our growing economy with 
lower interest rates. In 1980, the annual interest on the national debt 
accumulated over our entire history was $75 billion. Think about this. 
In 1980, when President Reagan came to office, it took a whole national 
debt to accumulate over 200 years, and the interest was $75 billion. 
Yet, when 12 years of Republican administrations ended, that amount had 
skyrocketed. So the interest on the national debt is now $248 billion.
  We had failed fiscal economic policies of the last decade, and we are 
paying the price. These interest payments on the national debt remain 
too high, and they have to be reduced further. But the proposed 
constitutional amendment, were it to pass, only allows Members of 
Congress who don't want to step up and cast the tough votes to bring 
down the deficit to say when the Constitution is going to do it. We can 
delay congressional action. Eventually we will toss it into the courts 
and let them do it.
  Frankly, I wish Congress and the President would, instead of talking 
about a debate here that will go nowhere, sit down and do the tough 
things that are necessary to bring the budget under control.
  Mr. President, I notice that the other side now has another speaker. 
I reserve the remainder of my time and yield the floor.
  Mr. HATCH. Mr. President, how much time does the Senator need?
  Mr. THOMAS. About 10 minutes.
  Mr. HATCH. Mr. President, I yield 10 minutes to the Senator from 
Wyoming.
  The PRESIDING OFFICER. The Senator from Wyoming is recognized.
  Mr. THOMAS. Mr. President, I thank my friend from Utah for the time, 
but more particularly for the effort and the leadership he has given to 
this issue. Interestingly enough, it is one of the toughest issues. One 
would think moving to a balanced budget, ensuring a balanced budget, 
ensuring financial responsibility would not be such a tough issue. But 
this has been going on for a very long time. So I appreciate very much 
the job that has been done. We come to the vote on the issue finally. 
We have talked quite a little about it this year. We, of course, have 
talked for a number of years before.
  We can talk about a balanced budget if you choose, but what we are 
really talking about is financial responsibility. It is interesting to 
me to hear those who oppose it--and for good reason--who have been here 
for 20 years and say, ``Let's just do it, take the tough votes.'' But 
they haven't done it for 20 years. The monument in front of the 
leader's desk represents 28 years of unbalanced budgets. Yet, we hear 
all the time, just do it, take the tough votes and do it. Well, the 
evidence is that isn't what is done.
  We hear the same words every year: ``I am for a balanced budget, but 
* * *'' and then they go on to say why it can't be done. They go on to 
find reasons for not voting for the kind of discipline that it clearly 
takes to balance the budget. That is not a brand new idea. It is 
something we do in most of our States. We do it in my State of Wyoming, 
and we are proud of that. The legislature doesn't spend any more, under 
the constitution, than they take in.
  I am always interested in how we seek to shift this to some kind of a 
partisan thing and talk about the Presidents. Frankly, the Presidents 
don't decide the budget. That is specifically, under the Constitution, 
the prerogative and the role of the Congress. It starts in the House of 
Representatives. Spending--the President cannot do any spending without 
the Congress. So we say, oh, Reagan did this, and Bush did that, and 
Bill Clinton did this. I think we ought to get real with ourselves and 
say, wait a minute, it is the Congress that does the spending. But we 
hear the same thing. Then Senators go home and talk about balancing the 
budget, but then come and say, ``But, gosh, there is this little thing, 
and I cannot accept it in this present form.'' How many times have we 
heard that?
  Well, today, we have a chance to vote. I am very proud of the fact 
that there will be 55 Republicans and 11 Democrats voting aye, voting 
for fiscal responsibility, voting to say $5.5 trillion debt is more 
than we want to send off to our kids and grandkids. Other than defense, 
interest is the largest item in the budget--interest on the debt. We 
pay $270 billion in interest on the debt.
  So the real issues here, it seems to me, are broader than the details 
of the amendment. They are broader than whether we are going to balance 
the budget. They really have to do with your view of how large and 
inclusive the central Government is going to be. There is a very real 
relationship between the size of spending, the size of the deficit, and 
the size of Government.

  When I go home--and I think it is true of every other place--I hear 
that we have too much Federal Government. Every night on TV, we see all 
these things that are being spent. Nearly everyone believes that. Yet, 
spending continues to go up. The Senator talked about the great amount 
of courage it took to move, in 1993, to seek to balance the budget. 
How? The largest tax increase in the history of the world. So you see 
Government grow as that tax increase grows. So the real basic issue is 
more than just the amendment, more than just arithmetic, more than just 
the budget, it is how much Federal Government do you want in your lives 
and what are the proper roles of State and Federal Government and the 
private sector? Those are the real issues. So it divides pretty clearly 
between those who want more Government and want to spend more and 
whether or not people ought to be able to keep their own money. After 
all, the Government has no money except what it takes from us.
  So we hear constantly, ``Let's just do it.'' But the monument stays 
right in front of us. We haven't done it. Then we hear, ``Well, but we 
are going to do it now.'' But the President's budget has not moved 
toward balance. The President promised us a balanced budget, and it is 
not a balanced budget. No one would agree it is a balanced budget by 
2002. On the contrary, there will probably be a $50 billion to $70 
billion more deficit then. It will go up from where it is now.
  Furthermore, we don't have the kinds of things we would like to have 
that are targeted to needed tax relief for families. We need permanent 
tax relief that is not triggered. We need capital gains to encourage 
the economy. Instead of that, we have a budget presented--and we are to 
accept that as movement toward a balanced budget, by having a 75-
percent backload; temporary tax cuts of $98 billion, but tax increases 
of $76 billion? Taxes go up the first year, and the tax cuts are not 
phased in until later. More entitlement spending, more Government--$60 
billion in new entitlement spending.
  Is that called balancing the budget? It is, if you want to continue 
raising taxes. That is the real choice you and I have as voters and 
taxpayers. If you want more services, you have to pay more. That is the 
way that works. You know the best example of a really good government, 
I suppose, is on the local level when the school board says we need a 
new science room for the high school and it is going to cost you $50 a 
year and you get to vote on it and you balance it. You say, is it worth 
it, yes; is it worth it, no. Do we get to do that in the Federal 
Government? Oh, no, of course not.

[[Page S1851]]

  So what we are talking about here is really direction, whether we 
have less Government or whether we, on the central level, move more 
Government to States and local communities, whether we in fact are able 
to spend more money for our families as we choose or whether we spend 
more total tax--now the average family in the country spends 39 
percent--on our income. I saw a poll the other day in which almost 
unanimously they said 25 percent is the maximum that we ought to pay. 
We are paying nearly 40.

  So, Mr. President, this is our opportunity. This is our chance to put 
our money where our mouth is. If we are going to balance the budget, 
this is the way to do it. The evidence is that we can't do it any other 
way.
  So I hope we have our vote this afternoon and it passes. If it 
doesn't, it is not the end. We will continue to do this. We will have 
to. It is the only way that we can be financially and fiscally 
responsible for the future.
  Mr. President, I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, as I listened to the debate on the floor of 
the Senate, I heard that the budget deficits begin in Congress and not 
with the President. Let's look at the facts. During the Reagan years 
President Reagan got 99.999 percent of everything he asked for in the 
budget, including the deficit. In fact, during those years President 
Reagan vetoed only one appropriations bill. Only one spending bill did 
President Reagan veto. Why? Because it didn't spend as much money as he 
had requested. Congress actually had come back with less money than he 
requested. So he vetoed the bill and asked for more money.
  So let's just fully understand what happened. It was the same way 
with the Bush administration. The budget was what the President asked 
for. But let's assume that it begins here in the Congress. Then, I ask 
my friends in the Republican majority, where is your budget? You can't 
have it both ways. You can't say that the budget deficits are the fault 
of the Congress and those who lead the Congress. Republicans lead the 
Congress. Where is the budget?
  Instead of spending weeks and weeks and weeks on the floor debating 
how we might amend the Constitution--it has been amended only 17 times 
since the Bill of Rights--instead of debating why we would amend the 
Constitution with an amendment that even its proponents can't explain 
its consequences, trying to amend the Constitution just because 
somebody is taking a poll and says that is popular without going into 
the details of what is involved, instead of spending all of the time 
doing that, why not actually negotiate the details of the historic 
agreement of trying to balance the budget? Why aren't we doing that? 
Because it is easier to pass a constitutional amendment which is so 
flawed that even its proponents cannot say what it does to Social 
Security, what it does to a capital budget, what it does to a court 
challenge, what it does to the power of purse. It is easier to do that 
than to sit down and say, let's talk about the tough votes, let's talk 
about what we do with school lunch, let's talk about what we do with 
the defense budget, let's talk about what we do with Medicare, let's 
talk about what we do with Medicaid, let's talk about what we do with a 
farm program, or a foreign program, and on and on and on.
  That means that every time you come up to vote, you are going to 
anger somebody; you are going to anger a special interest group on the 
right, or you are going to anger a special interest group on the left.
  So it is a lot easier to say, let's just toss it over to the courts, 
let's toss it over to a constitutional amendment, let's toss it to 
something that we can't even explain. We can't even say what it does to 
Social Security or to a capital budget or anything else. But we can go 
home with a slogan that has been tested by the polls and by focus 
groups. We can say, ``I voted to balance the budget.'' Boloney. It is 
sort of like me voting to grow hair. It might make me feel good, but 
``it ain't gonna work.'' It is the same thing here.
  In light of all we have experienced, but also what we have 
accomplished in the last 4 years in bringing the deficit down in each 
of those 4 years, there is no basis today for seriously contending that 
a constitutional amendment is needed or that it is a necessary 
substitute for political will or even that it is the only way to 
achieve a balanced budget. We have shown in 4 years of bringing down 
the deficit--and now going into a fifth--that there are other ways.
  During the course of time that has been reserved for debate on this 
proposed constitutional amendment, there has been a good deal of talk 
about the President's proposed budget. The President made a State of 
the Union Address on February 4. He submitted his statement on his 
proposed balanced budget the following day. Then on the next day, 
February 6, the President sent his proposed budget to Congress. My good 
friends in the Republican Party have been quick to criticize that 
proposed budget, but they left out one thing in their criticism. They 
never said where their budget is or what their budget does. I ask my 
friends on the other side of the aisle, Where is your budget? If you 
want to say that the budgets really come from the Congress, you are in 
the majority. You run the Congress. You turn the lights on in the 
morning. You turn them off at night. In between, prepare a budget. 
Where is the alternative? Where are the proposed amendments to the 
President's plan?

  I hope that we do not get into partisan harping and carping and, 
instead, get on to the process of developing a bipartisan consensus. It 
is not going to be easy, Mr. President. Like so many other Members who 
have voted to bring the deficit down 4 years in a row, I bear the scars 
of saying no to every special interest group from the right to the left 
when I voted for cut after cut after cut--the farm bill being one good 
example of that, the Lugar-Leahy farm bill. Item after item, we have 
done it not by gimmicks but by solid votes. But it has been a month now 
and we have not seen a proposal for modification of the President's 
budget nor have we seen an alternative for the majority party. The 
President even came to Capitol Hill to meet with congressional leaders, 
going the extra mile--going the extra 2 or 3 miles.
  We are fast approaching our statutorily imposed deadline of April 15 
for a budget resolution. So let's see what this budget resolution is 
going to be, and let's debate it. Let's proceed to debate the budget 
and, in the words of Secretary Rubin, ``finish the job of balancing the 
budget by the year 2002.'' It has been 4 years of bringing the deficit 
down, and we are about go into the fifth year of bringing it down. 
Let's get a budget that does the job.
  What it means is that the Republicans and the Democrats are going to 
have to hold hands, and we are going to have to vote in a way that is 
going to offend some of our core constituencies. But the American 
people in the long run will be better off. Certainly the American 
people would be better off and the world's strongest economy would be 
better off without tinkering with the Constitution, which basically 
becomes a judicial nightmare and does nothing to balance the budget.
  Mr. President, I reserve the remainder of my time.
  Mr. HATCH. Mr. President, I am delighted to have the relationship 
with our cosponsor on this amendment on the Democrat side, Senator 
Bryan from Nevada. He has fought a valiant battle here, and I 
appreciate the opportunity of working with him on this. We are still 
hoping that this vote will turn out all right at the end of the day.
  So I am more than delighted to yield 15 minutes to my distinguished 
friend and colleague. I thank him for his leadership on this matter.
  The PRESIDING OFFICER. The Senator from Nevada.
  Mr. BRYAN. Mr. President, I thank the Chair. I thank the 
distinguished Senator from Utah for his thoughtful comments.
  Mr. President, let me just say, by way of prefacing my comments, that 
I have enjoyed being a participant in this debate. And I have enjoyed 
the manner in which my colleague, the distinguished Democratic floor 
leader--who has a very different point of view from that which Senator 
Hatch and I share--has conducted himself and the arguments that he has 
made and the responses by the senior Senator from Utah. It seems to me 
that that is what this institution is all about--the ability to conduct 
an honest debate on the

[[Page S1852]]

floor with different points of view being expressed. Hopefully from 
that collision of different points of view will emerge a public policy 
which will enable this country to move forward on the correct course.

  Mr. President, the Senate will soon cast a historic vote to decide 
whether Senate Joint Resolution 1 should become a part of our 
Constitution. This may very well be the most significant vote the 
Senate will cast in this session of the Congress. If we are successful, 
it could dramatically alter the future of our country in a very 
positive way. I renew my request and urge my colleagues to vote in 
favor of a balanced budget amendment for the sake of future 
generations.
  The Senate has been debating Senate Joint Resolution 1 for an entire 
month, and just as it should when we are considering an amendment to 
our Constitution, the debate has been thoughtful and thorough. We have 
debated serious and credible amendments on a wide range of topics 
including the treatment of Social Security and capital budgeting. The 
Senate debated these issues and after debate decided to leave Senate 
Joint Resolution 1 intact and rejected each of those proffered 
amendments. I supported several of the amendments, but it is now time 
to put the debate on those amendments behind us and pass the amendment. 
While some of us may have felt that the amendment could be improved 
with certain change, all of us must realize that we are better off with 
this amendment than with the status quo.
  I would like to take a moment to recognize the two of my colleagues 
who have spent more time in the Chamber debating this than any of us, 
and that would be the senior Senator from Utah [Mr. Hatch], and the 
senior Senator from West Virginia [Mr. Byrd]. These men have served in 
this institution with distinction for a combined 60 years. During this 
past month, each of them has treated us to his own brand of eloquence 
in espousing his point of view. It has been a delight for those of us 
who are privileged to serve in this institution to hear and to share in 
that debate. No one who has observed the floor proceedings can question 
the depth of their sincerity about their feelings. It is a tribute to 
the democratic process to see this kind of debate occur in this 
Chamber.
  Mr. President, amending our Constitution is the most significant 
action the Senate can take, and it should not be undertaken lightly. In 
this case I believe the future of our country is at stake--the ability 
of our children and our children's children to have the same economic 
choices in their time that our generation has enjoyed.
  We are constantly reminded that everyone is for a balanced Federal 
budget but not everyone is for a constitutional amendment which puts 
that process in place and helps us to achieve that goal. On its face, 
this position appears to me to be inconsistent. If you are for a 
balanced budget, it would seem the more logical course of action would 
be to support a mechanism that would help to facilitate the outcome. I 
believe the amendment accomplishes that purpose. The amendment itself 
is very straightforward. Congress may not let spending exceed revenues 
in a given year unless a 60-percent supermajority of those elected both 
in the House and the Senate vote to permit a specific amount of deficit 
spending. While this does not guarantee balanced budgets, it will, in 
my judgment, make it more difficult to authorize deficit spending if 
this process, a constitutional amendment, is in place.
  My experience as Governor of Nevada convinces me of the merits of 
this process. With a State constitution that requires a balanced 
budget, those of us who were privileged to serve as the chief executive 
of our States were forced to make hard choices in spending and on 
revenues, particularly during the period of economic slowdown during 
the 1980's. The year that I assumed the Governorship of Nevada, January 
1983, we were concerned that the State payroll would not clear because 
budget revenues had fallen far short of their original and earlier 
projections. Yet, with that hammer of a constitutional amendment in 
place in our own State, it would have been much more difficult, much 
more difficult to have ignored the constitutional mandate to balance 
the budget. Therefore, both the Governor and the State legislature were 
able to resist the pressure of those good people in our State urging 
spending for programs that many of us were for.
  The point I think, Mr. President, is the hard choice. It is the 
nature of those who are advocates for these programs, good people all, 
to urge more spending than they know a Governor at the State level or 
the legislature at the State level can approve, and it becomes the 
responsibility of those of us who have served at the State level as 
Governors to submit a balanced budget and for State legislatures to 
require a balanced budget.
  We did not have the luxury of avoiding the painful cuts by running 
deficits. That would have been the easy way out and, unfortunately, the 
way the Federal Government has chosen to proceed in 59 of the last 67 
years.
  My experience as a Senator has also taught me how difficult those 
budget choices can be. The process is essentially the same, with a much 
greater magnitude, and while we have made impressive progress in 
reducing the deficit over the last 4 years--$107 billion in the last 
fiscal year, projected at one time to be $292 billion--the President 
and Congress can justifiably take pride in what they have accomplished, 
but balancing the budget by the year 2002 will require sustained 
discipline, the kind of discipline that has not characterized our 
actions either from the White House or from the Congress. If we are 
successful, we will have accomplished something that has occurred only 
once in the last 33 years.

  After 2002, the deficit picture gets worse, and gets dramatically 
worse, when the baby-boom generation, a tidal wave, begins to impact 
the programs that we have put in place for the elderly in America. 
Without the balanced budget amendment, the temptation will always be 
there, the temptation to avoid making the hard choices.
  History shows us all too well that at the Federal level both the 
White House and the Congress, without reference to partisan 
affiliation, has tended to take the easy road. It is true that Senate 
Joint Resolution 1 does not guarantee that we will not take the easy 
road, but I submit it would make it much harder to do so.
  Many of my colleagues who have indicated they plan to vote against 
Senate Joint Resolution 1 have stated their concerns over not excluding 
Social Security from the budget calculations. While I agree that 
excluding Social Security would be in our long-term best interests, I 
believe they are mistaken if they believe that Social Security will be 
better off without the balanced budget. I believe our best option would 
be to exclude Social Security from a balanced budget amendment, and I 
have so voted. But our next best option is enacting the balanced budget 
amendment as it appears in the Chamber today and as we will vote on it 
this afternoon. Our worst option is to preserve or to retain the status 
quo, and that is to do nothing, to reject this proposed balanced budget 
amendment.
  No one disputes that a balanced budget amendment will help end our 
string of deficits. Some will argue that we do not need it to achieve 
our goal, but no one says it will not help. And while the amendment 
does not mandate a balanced budget, it does, in my opinion, make it 
more likely. Therefore, I think it is reasonable to conclude that a 
balanced budget amendment will lead to less deficit spending than if we 
fail to enact the balanced budget amendment.
  If a balanced budget amendment will help cut deficit spending, what 
will the effects of less deficit spending be on programs that we all 
support, like Social Security? Every dollar of deficit spending that 
occurs now is a dollar that will not be available to pay Social 
Security retirees when they need it. And even worse, we lose not only 
that dollar but we lose the interest that we pay on it, which 
multiplies rapidly with the magic of compounding.
  The best example of this can be illustrated by looking at where we 
were in 1980. If we had adopted a balanced budget amendment in 1980, 17 
years ago, and had not increased the national debt from about $1 
trillion to more than $5 trillion today, we would not have to cut a 
single dollar from this year's budget to achieve balance. In other 
words, we would be in surplus if we did not have to make the interest 
payments on the deficits that were run up over the last 20 years.

[[Page S1853]]

  I do not want Senators years from now to say, ``Gee, if they had only 
adopted a balanced budget amendment in 1997, we would not have added 
trillions more to our national debt. We would not have added billions 
more in interest payments in servicing that debt. We would not have to 
be cutting the worthwhile spending programs because of the larger 
national debt.''
  Mr. President, the trend line is both alarming and disturbing. Since 
1980, the percentage of our budget dedicated to servicing the debt has 
risen from 7 to 15 percent. This year's budget contains a line item of 
$245 billion for interest payment on the national debt. That is the net 
interest payment. In other words, almost $1 out of every $6 in our 
budget goes to servicing the $5.3 trillion national debt.
  Worse than that, if the interest we earn from Social Security and 
other trust funds which is supposed to be saved to be paid out in 
future years is excluded, the gross interest we owe is really $350 
billion.
  No one claims running a Federal budget deficit actually helps Social 
Security or other Federal program over the long haul. Congressman Joe 
Kennedy who is an undisputed champion of social programs to help the 
poor makes this point very eloquently. He maintains that deficit 
spending has not helped, but has hurt, spending for social programs.
  Every dollar that must go to servicing the national debt is a dollar 
that cannot go to school lunch programs, paving roads, or repairing our 
neglected national parks. Interest payments are now the second largest 
Federal spending item following Social Security in our budget.
  I must ask my colleagues who support taking Social Security out of 
the balanced budget amendment, as I do, whether their interests are not 
better served by a constitutional amendment that helps facilitate a 
balanced budget.
  This is now my 9th year in the Senate. I do not recall a single 
Senator getting up and offering a budget that excluded Social Security 
from the budget calculations. For those who profess to feel so strongly 
about Social Security that they cannot vote for a balanced budget 
amendment, why have they never attempted to exclude Social Security 
from past budgets?
  While it is wrong to use Social Security to mask the true size of the 
deficit, including Social Security, that is no reason to vote against a 
balanced budget amendment, in my view.
  The greatest threat to Social Security is the debt. There are real 
and tangible benefits for every American family if we balance the 
Federal budget.
  Interest rates are estimated to be 2 percent higher because of the 
deficit. The average price of a new home is $37,000 more because we 
can't balance the budget. A student loan is estimated to be almost 
$2,000 more expensive and a new car $1,000 more expensive because we 
haven't balanced the budget.
  Under current trends, a child born today will have to pay $180,000 
over their lifetime to service the national debt. What kind of burden 
are we passing on to future generations?
  Given the overwhelming benefits of a balanced Federal budget, I 
strongly believe this country needs a balanced budget amendment to help 
us achieve this goal. Yes, there are some risks that a minority of our 
legislators will act irresponsibly--but that can happen today if 41 
Senators choose to filibuster. Therefore, I believe we gain the 
benefits of greater pressure to achieve a balanced budget without 
incurring additional risks.
  We have a historic opportunity this afternoon to change the future 
course of our country in a very positive way. If we fail, I am afraid 
we will look back 20 years from now and be even further in debt, with 
fewer economic choices for that generation, and regret that we had not 
taken this important step today.
  I urge my colleagues to vote in favor of Senate Joint Resolution 1. 
This vote will be your legacy to your children and to our country's 
future economic well-being.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. Mr. President, I thank my distinguished friend and 
colleague, and certainly for his kind remarks regarding me. I take 
those as a special feeling of friendship and love for the work he has 
done and the kindness he has shown to me. I want to personally express 
my appreciation for how hard he has worked on this amendment, how much 
it has meant to me and others on this side--very much--and, I think, to 
his colleagues who are voting with him on his side. I just want to 
personally express my gratitude to him for the good work he has done.
  I reserve the remainder of my time.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, I also have great affection and respect for 
the Senator from Nevada. I know to err is human and to forgive divine. 
While I make no claims of divinity, I forgive him for his position on 
this.
  I also point out both the distinguished Senator from Nevada and the 
distinguished Senator from Utah are two of the hardest working Members 
of this body. In their debate, they have been strong and forthright, as 
has the distinguished Presiding Officer, who made his first speech on 
the Senate floor on this issue. I noted at that time, so many times 
when one gives his or her first speech on the floor it is on an 
inconsequential item. This time, it was one of the most important items 
that the distinguished Presiding Officer will have a chance to debate 
during his tenure in this body.
  I say this because I think during the past weeks of debate, all of 
us, Republicans and Democrats, have tried to fulfill our responsibility 
as one of the two Houses of Congress to create a full and fair record. 
Sometimes it may have seemed tiring, for the distinguished Senator from 
Utah and myself, as floor managers, to be here. But the more we have 
listened, the more we have realized that this is one of those issues 
where a strong and full debate record has been made. Even if those of 
us who have been here may not realize that at this moment, certainly 
historians will.
  I believe most of the men and women in this body, in both parties, 
have approached this historic debate with a seriousness the 
consideration of a constitutional amendment requires. Every one of us 
should pause and think: We vote either to amend the Constitution or not 
to amend the Constitution. With the exception of a vote to declare war 
or with the exception of one or two other areas, I cannot think of 
anything that approaches the seriousness of voting on a constitutional 
amendment. No Member of the Senate should take that lightly. All 
Members of the Senate should think they may only once in their 
lifetimes actually have a vote that will determine whether the long and 
almost sacred process of amending our Constitution begins. So we should 
think long and hard how we vote.
  Those of us who expressed our reluctance to amend the Constitution, 
for this or many other issues, have at least said, if we are going to 
amend the Constitution, let us make sure the amendment is as good as 
can be written.
  We have offered serious and substantial amendments to this proposal. 
I believe the amendments that we have offered--all from this side of 
the aisle--have revealed serious and substantial flaws in this proposed 
change to our Constitution.
  What has bothered me in this debate is instead of addressing these 
serious and substantial flaws, instead of acknowledging what writers 
outside the Senate have acknowledged, that the proposed change to the 
Constitution is flawed, but instead of addressing the substantial 
flaws, the sponsors of the resolution have proceeded with a no-
amendment strategy, in which they have failed to consider the merits of 
the amendments. I think there was an up-or-down vote only one of the 
amendments. The others were all tabled. The sponsors of this proposed 
constitutional amendment have taken the unyielding position that no 
changes in the language are acceptable.
  I cannot think of an instance that a major and contentious issue has 
reached the Senate floor where Members have not realized, before its 
conclusion, that there may well have to be some changes. During the 
weeks of debate on Senate Joint Resolution 1, this no-amendment 
strategy has been a disappointment to many, certainly to the senior 
Senator from Vermont. I do not believe this is the way to debate an 
amendment to the Constitution of the United States. Both proponents and 
opponents of this proposed constitutional change should be searching 
for the best

[[Page S1854]]

language possible to propose to the States.
  My own feelings, as a Member of the U.S. Senate, is that if this is 
going to pass, let it at least pass in the best possible form. Today, 
it is a long way from that.
  As the distinguished Senator from New Jersey [Mr. Torricelli], said, 
``Good is simply not good enough when we are amending the Constitution 
of the United States.''
  Frankly, Mr. President, constitutional amendments are held to a 
higher standard. The perfecting and substitute amendments offered 
during the debate on this amendment showed the serious and substantial 
flaws, and I will recall a few of them.
  I will continue speaking. I have already talked with my good friend 
from Utah about when a Member on the other side comes and seeks 
recognition, I will, of course, yield for him or her to speak. But 
while waiting for that, let me talk about a few of these amendments.
  We had the Durbin amendment. The distinguished Senator from Illinois 
[Mr. Durbin], offered the first amendment during our debate, and it 
highlighted the fact that Senate Joint Resolution 1 is unsound economic 
policy. What he did in his amendment would have allowed us to waive 
this article by majority vote in the event of an economic recession or 
a serious economic emergency.
  His amendment had the underpinning of the statements of more than a 
thousand of the Nation's most respected economists, including at least 
11 Nobel laureates and the former chairman of President Nixon's Council 
of Economic Advisers, the current and former Federal Reserve Board 
Chairman, the former Democratic and Republican directors of the 
Congressional Budget Office. All agreed that the underlying resolution, 
Senate Joint Resolution 1, was unsound economic policy. They all agreed 
that it would hamper the Government's ability to cope with economic 
downturns.
  Treasury Secretary Rubin, one of the most respected Treasury 
Secretaries I have served with in my 22 years here, testified before 
the Judiciary Committee:

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

  I think of the history books that tell us that as the United States 
was going into its greatest depression, President Herbert Hoover, 
wanting to give credibility to the American people and hope to them, 
instituted a balanced-budget policy. It was like throwing gasoline on 
to the smoldering embers of an embryonic depression, and what might 
have been only a slight recession became a depression that destroyed 
the hopes and dreams of many of our parents and grandparents. It was a 
depression that wreaked the greatest havoc in the lives of American 
people in this century. It was a depression that caused great migration 
of people from various parts of our country, nearly wreaked our farm 
economy, our agrarian economy, and destroyed the hopes and dreams of 
families in every part of America.

  What we have done now is say if your State or region is hit by a 
major recession or emergency that a minority of Senators or a minority 
of Representatives could stop a Federal response to that major 
recession or emergency. Although the sponsors of this measure 
repeatedly outline the dangers of a budget deficit, they fail to 
address how the proposed constitutional amendment will provide for the 
flexibility needed in economic downturns without holding working 
families in hard-hit regions hostage to a supermajority vote. Senator 
Durbin's amendment would have restored that flexibility by requiring a 
majority vote to respond to economic recessions and emergencies.
  But the sponsors and proponents of Senate Joint Resolution 1 opposed 
the Durbin amendment. The sponsors and proponents of the underlying 
resolution did not offer alternative language to address the real 
economic concerns surrounding Senate Joint Resolution 1. Instead, with 
lockstep voting, they defeated the Durbin amendment by a vote of 64 to 
35. Having forced this effort to be tabled on February 10, and they 
rejected the Torricelli amendment on February 26, the Republican 
leadership hinted this weekend that they are now themselves finally 
considering an amendment along these lines but have not brought one 
forward.
  It is ironic, last Friday, the Senate passed an air ticket tax--they 
reinstated one that had lapsed--imposed a significant tax without a 
recorded vote by unanimous consent. I wonder whether the proponents of 
the provisions of the underlying resolution would draft in the 
Constitution a requirement that such measures only be passed by a 
constitutional majority after a recorded vote. In this body the 
majority leader called up the matter, and, in moments, it was done. I 
am not suggesting it should not have been done, but it is also reality. 
This is a significant tax. It is a significant tax from which the 
American people benefit. Hopefully, it will make our airports safer, 
air traffic more efficient and safer, and we benefit by it. But it was 
not reinstated with a recorded vote.
  I withhold the remainder of my time. Mr. President, I had other 
amendments I was going to speak to, but I see the distinguished Senator 
from Maryland on the floor who is seeking time. How much time does the 
Senator from Maryland want?
  Mr. SARBANES. Twelve minutes.
  Mr. LEAHY. Mr. President, I yield 12 minutes to the distinguished 
Senator from Maryland. And, Mr. President, before doing that, I 
understand this, that we are going back and forth. Does the 
distinguished Senator from Utah have any objection?
  Mr. HATCH. I have no objection. This is fine. I am happy to 
accommodate the minority on this.
  Mr. LEAHY. Mr. President, I was going to speak about the Dodd 
amendment, but I will withhold on that and will do that at another 
time. I yield 12 minutes to the distinguished Senator from Maryland.
  The PRESIDING OFFICER. The Senator from Maryland.
  Mr. SARBANES. Mr. President, I thank the distinguished Senator from 
Vermont for yielding me this time.
  Mr. President, there is no doubt that this is an extremely important 
vote that Senators are about to cast this afternoon. An amendment to 
the Constitution to require a balanced budget ought to give every 
Senator great pause.
  First of all, amending the Constitution is no light enterprise under 
any circumstances. Second, we ought to be certain that we are not 
falling into the trap of unintended consequences, that we do not pass 
an amendment that does more harm than good. In this respect, we ought 
to heed the advice which we have been receiving from many quarters with 
respect to the potential impact of this amendment to the Constitution 
on our ability to conduct wise economic policy.
  In this respect let me make four points in opposition to the balanced 
budget amendment.
  First, let me discuss the effect of this amendment on our ability to 
avert or slow economic downturns.
  Mr. President, over 1,100 economists have taken out an advertisement 
condemning the balanced budget amendment as unsound and unnecessary. 
Its signers include 11 Nobel laureates in economics, and they state--
and I quote:

       We condemn the proposed ``balanced-budget'' amendment to 
     the Federal Constitution. It is unsound and unnecessary.

  They then go on to say--and I think this is an extremely important 
statement:

       The proposed amendment mandates perverse actions in the 
     face of recessions.

  I repeat: ``The proposed amendment mandates perverse actions in the 
face of recessions.'' The statement continues:

       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.

  Secretary Rubin, the Secretary of the Treasury, testifying before the 
Senate Judiciary Committee, echoed these sentiments when he stated that 
the balanced budget amendment threatens to turn economic downturns into 
recessions and recessions into depressions.
  Mr. President, along these lines, I want to draw attention to this 
chart beside me which shows the fluctuations in real economic growth 
from 1870 to

[[Page S1855]]

1995. This is 1870 here. This is 1995 out here. What this chart shows 
is that since the end of World War II, when we began using automatic 
fiscal stabilizers--what the 1,100 economists call the ``so-called 
built-in stabilizers''--we have been able to greatly ameliorate the 
fluctuations in the business cycle. You still get business cycle 
fluctuations, but you do not get the boom-and-bust pattern which 
characterized the pre-World War II period in which a downturn would 
become a recession, and a recession would become a depression.
  We have had fluctuations since 1945. But they have almost always been 
in the positive range in terms of economic growth. Our economy has 
benefited enormously from this stability. When the economy slows down, 
unemployment rises, tax revenues fall off, and the paying out of 
unemployment benefits increases. We therefore automatically start 
incurring deficits which serve to slow down and head off the economic 
downturn. These automatic stabilizers have enabled us to significantly 
ameliorate the business cycle.

  As the economists' statement says, an amendment to the Constitution 
requiring a balanced budget would prevent this kind of countercyclical 
fiscal policy and, therefore, would greatly increase the risk of severe 
economic fluctuations during an economic downturn.
  Amendment supporters say, well, we will be able to see an economic 
downturn begin and we will get a supermajority to waive the amendment's 
balancing requirements. The fact of the matter is, however, that it is 
very difficult to tell when you are in an economic downturn. The beauty 
of the current system is that it automatically adjusts as the economy 
goes soft. As the economists said in this full-page ad in the paper, 
``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.'' No congressional action is 
required for this system to go into effect.
  If, in an economic downturn, you try to balance the budget by cutting 
back on unemployment benefits and raising taxes in order to balance it, 
you will just drive the economy even deeper.
  In short, Mr. President, this amendment prevents us from doing the 
very things that have allowed our economy to stay on an even keel for 
the last 50-plus years.
  Second, Mr. President, it is very important to understand that we do 
not have a capital budget at the Federal level. The argument is being 
used by the proponents of this amendment that because State governments 
have to balance their budgets, local governments have to balance their 
budgets, business firms balance their budgets, and private individuals 
balance their budgets that the Federal Government should have to 
balance its budget. But none of these entities--not States, local 
governments, private companies, or households--would balance their 
budgets if they kept their budget the way the Federal Government does 
in accounting terms. There is no capital budget at the Federal level.
  State and local governments have a capital budget, and they borrow in 
order to finance it. I sat on a committee that received testimony from 
two State Governors in favor of the balanced budget amendment to the 
U.S. Constitution. One of the arguments they made in favor of the 
balanced budget amendment to the Constitution was that their State 
balanced budget amendments gave them a better credit rating for when 
they went into the bond market to borrow, allowing them to borrow at 
lower interest rates.
  Of course, my question to these Governors was, if you are required by 
your Constitution to have a balanced budget, why do you have to borrow? 
Their response was, ``Well, Senator, you don't understand. We borrow to 
finance the capital budget. Our constitutional requirement for a 
balanced budget is for the operating budget, but we can have a capital 
budget for which we borrow.''
  Of course, it makes good sense to borrow for capital items. 
Businesses do it when they invest in new plant equipment and private 
individuals do it when they buy a home or a car. Very few people can 
afford to buy those items out of cash in the year of purchase. If you 
calculate prudently in terms of your expected income flow and the 
amount you are spending for the capital asset, it makes good sense to 
borrow in order to finance the capital asset, have the use of it over 
time, and pay it off over that period as you amortize the use of that 
capital asset. Business does it all the time. Private individuals do it 
all the time.

  So this analogy that amendment proponents draw to State and local 
government, private individuals, and business does not work because 
there is no capital budget at the Federal level. And amendments that 
were offered on the floor to introduce capital budgeting into the 
Federal accounting process were rejected.
  Third, it is argued that if we face an economic or military 
emergency, you will get a supermajority in this body in order to waive 
the amendment's balancing requirements. Well, Mr. President, we have 
seen the difficulty we have around here extending the debt limit by a 
simple majority. This legislation requires a three-fifths 
supermajority, three-fifths of the total membership of the body, in 
order to raise the debt limit. Very few of the efforts to raise the 
debt limit in recent years have had that kind of support.
  I have voted for debt-limit increases with Republican Presidents 
because I thought it was the responsible thing to do. But in many of 
those instances, even where there was some bipartisanship involved, the 
vote to increase the debt limit failed to garner 60 votes.
  The difficulty of gathering a supermajority simply cannot be 
overestimated. Yet amendment supporters assert, well, clearly, Congress 
will see a crisis and make the proper response. Our history, however, 
simply does not support that contention.
  Let me give you just one example, involving national security, 
because proponents of this amendment contend that it will not inhibit 
us from addressing our national security needs. In 1940, on the 
recommendation of President Roosevelt, the United States enacted a 1-
year draft. The draft came up for renewal a year later, in the fall of 
1941, not too long before Pearl Harbor.
  At this point, the House of Representatives had an intense debate 
about extension of the draft. Speaker Rayburn, in fact, went into the 
well of the House to appeal for the extension of the draft, saying it 
was essential for the security of our country. That extension passed in 
the House on a vote of 203 to 202. That vote would not meet the 
requirements of this balanced budget amendment, because to meet the 
requirements of the balanced budget amendment, you have to have a 
majority of the whole membership to waive the balanced budget amendment 
in time of national security emergency. The majority of the whole 
then--as now--would have been 218; 203 falls short of the majority of 
the whole requirement in the balanced budget amendment, let alone the 
supermajority requirements that are contained in the amendment. So 
those who place faith in the assumption that the Congress would easily 
waive the balancing requirements are much too sanguine. I am very 
apprehensive as to whether, either in a national security crisis or an 
economic crisis, we would be able to respond. In both instances, it is 
imperative to be able to respond early. The longer you wait, the more 
serious the problem, the further you fall behind the curve. This 
balanced budget amendment has the effect, at best, of delaying 
essential action, and at worst, of preventing such action at all.
  Fourth and finally, let me very quickly make the point that the way 
to balance the budget is to make the budget decisions that we are 
confronted with, not to amend the Constitution. We have been trying to 
do that, and we have had some good success over the last 4 years. We 
have brought the deficit down.
  How do you actually bring down the deficit? How do you really address 
this problem? What I have argued here this morning is that amending the 
Constitution carries with it great risks, as the economists in this 
article have indicated, and that we can do the job--and have been doing 
it--without a balanced budget amendment.
  I ask unanimous consent that the full economists' statement be 
printed in the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

[[Page S1856]]

   1,100 Economists Condemn Balanced Budget Amendment: ``Unsound and 
                             Unnecessary''

       The statement below has been signed by over 1,100 prominent 
     economists, more than double the number who signed a similar 
     statement in 1992.
       The signers include 11 Nobel laureates in economics: 
     Kenneth J. Arrow and William Sharpe of Stanford University; 
     Gerard Debreu and John Harsanyi of the University of 
     California-Berkeley; Lawrence R. Klein of the University of 
     Pennsylvania; Wassily Leontieff of New York University; 
     Herbert A. Simon of Carnegie Mellon University; James Tobin 
     of Yale University; and Franco Modigliani, Paul A. Samuelson 
     and Robert Solow of M.I.T. The statement was drafted by 
     Robert Eisner, James Tobin and Robert Solow.
       ``We condemn the proposed `balanced-budget' amendment to 
     the federal Constitution. It is unsound and unnecessary.
       ``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.
       ``Unlike many state constitutions, which permit borrowing 
     to finance capital expenditures, the proposed federal 
     amendment makes no distinction between capital investments 
     and current outlays. Private businesses and households borrow 
     all the time to finance capital spending. The amendment would 
     prevent federal borrowing to finance expenditures for 
     infrastructure, education, research and development, 
     environmental protection, and other investment vital to the 
     nation's future well-being.
       ``The amendment invites Congress to require states and 
     localities and private businesses to do what it cannot 
     finance itself. It also invites more cosmetic accounting, 
     such as increased sales of public lands and other assets 
     counted as deficit-reducing revenues. Disputes on the meaning 
     of budget balance could end up in the courts.
       ``The amendment does contain escape hatches, but they 
     require super-majorities in peacetime, three-fifths of the 
     `whole number' (including absentees and non-voters) of each 
     House to adopt an unbalanced budget or to raise the debt and 
     a majority of these whole numbers to pass a bill to raise 
     taxes. These provisions are recipes for gridlock and 
     opportunities for irresponsible minorities to insist on their 
     agendas.
       ``The amendment is not needed to balance the budget. The 
     measured deficit has fallen dramatically in recent years, 
     from $290 billion in 1992 to $107 billion in 1996, to some 
     1.3 percent of gross domestic product, a smaller proportion 
     than that of any other major nation, none of which hobbles 
     its economy with a balanced-budget mandate. Congress and the 
     President can reduce the deficit to zero, that is, balance 
     the budget, or even create budget surpluses, without a 
     constitutional amendment.
       ``There is no need to put the nation in an economic strait-
     jacket. Let the President and Congress make fiscal policies 
     in response to national needs and priorities as the authors 
     of our Constitution wisely provided.

  Mr. SARBANES. To summarize once again the economists' statement, 
first of all, the balanced budget amendment would not enable us to 
respond automatically to economic downturns, running the risk, 
therefore, of turning recessions into depressions. Second, and I quote, 
``Unlike many State constitutions, which permit borrowing of financed 
capital expenditures, the proposed Federal amendment makes no 
distinction between capital investments and current outlays. Private 
businesses and households borrow all the time to finance capital 
spending. The amendment would prevent Federal borrowing to finance 
expenditures for infrastructure, education, research and development, 
environmental protection, and other investment vital to the Nation's 
future well-being.''
  If we had a capital budget right now, we would have a balanced 
budget, because there is well over $107 billion worth of capital items 
in the Federal budget.
  Third, I addressed the escape hatches and the difficulty of obtaining 
these supermajorities. That is really a recipe for gridlock.
  Fourth, and this leads again to my final point, we have brought the 
deficit down consecutively now for 4 straight years. How? We made tough 
decisions on spending and taxing. We voted for the 1993 economic plan. 
Many of those pushing the balanced budget amendment to the Constitution 
voted against that economic plan with respect to the budget. That was 
the plan that enabled us to bring the deficit down from $290 billion in 
1992 to $107 billion in the past fiscal year--a cut of almost two-
thirds in the deficit. That was done by making tough decisions. The 
chart beside me reveals this progress.
  An amendment to the Constitution, by itself, does nothing. You still 
have to make the budget decisions. We have been doing a good job of it. 
In fact, as this next chart shows, we have brought the deficit down 
from 4.9 percent of our gross domestic product down to 1.4 percent. 
This is the best performance in a quarter of a century, as a percent of 
GDP.
  So, Mr. President, we have been doing the job. And the way to 
continue to do the job is to address the deficit. As I noted, it is now 
down to 1.4 percent of GDP. This is better than any other major 
industrial power in the world. Chairman Stiglitz of the Council of 
Economic Advisors says he now goes to international conferences and 
everyone is talking about how well and how successfully the American 
economy is working. This figure--deficit as a percent of GDP, 1.4 
percent--is better than any of the other major industrial countries. 
Consider this chart beside me. This is the U.S. deficit as a share of 
GDP, 1.4 percent. Here is Japan at 3.1 percent; Germany at 3.5 percent; 
Canada, 4.2 percent; France, 5 percent; the United Kingdom, 5.1 
percent; Italy, 7.2 percent. So we have been doing the job, and we have 
been doing the job the way it needs to be done.
  In short, Mr. President, we ought not to meddle with the 
Constitution. We ought not run the risk of provoking economic prices, 
of preventing a timely response to a national security threat, of 
failing to make capital investments in the future of our country. Mr. 
President, I urge the rejection of this amendment to the Constitution.
  I thank the Senator from Vermont for yielding me time.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER (Mr. Enzi). The Senator from Utah is 
recognized.
  Mr. HATCH. Mr. President, I have enjoyed listening to the 
distinguished Senator from Maryland. He has made these points before.
  Let me tell you something. It is easy to bring the deficit down when 
you pass the largest tax increase in history, and when you have just 
ended paying for the savings and loan crisis. In all honesty, that is 
what happened. But, we still have, for the next 4 years, the deficit 
going back up. Only in Washington, DC, when you talk about reducing the 
increase in the amount of money the deficit goes up, do you call it 
cutting the budget.

  The fact is that, under the best of circumstances, we have at least a 
$107 billion annual deficit. It is going up to $200 billion by the year 
2002, by the budget the President submitted. So it is nice to talk in 
terms of how the deficit seems to be coming down for the last 4 years, 
after the largest tax increase in history, and the fact that the 
deficit was artificially high in 1992 because we got through paying for 
the debacle of the S&L crisis. I am not sure who to blame there. There 
is more than enough blame to go around for who created the debt, the 
question for today is who will vote to fix it?
  President Reagan's desire to have marginal tax rate reductions to 
spur economic growth proved to be the right policy. The marginal tax 
rate reductions in 1981, actually, according to many observers, 
resulted in an increase in revenues of over 40 percent during the 
additional years. At the lowest, it was 28 percent. Really, I think it 
was closer to 40 percent. But the real problem was that our friends of 
the more liberal persuasion kept spending, and President Reagan himself 
spent more on defense. So there is no question that all of that was 
what caused the high deficits, not the tax rate reductions.
  Having said all of that, we also know that automatic stabilizers are 
not what they claim to be. There are many reasons why we come out of 
recessions and why we haven't had deeper ones than we have had. 
Automatic stabilizers is probably a very minor part of that, according 
to most economists today.
  Today is the day of decision for Senate Joint Resolution 1, which 
proposes to amend the Constitution and provide for a means of getting 
us to a balanced budget. The sad reality is that if we do not adopt the 
balanced budget amendment to the Constitution, then the bridge to the 
21st century is likely to be washed out with a flood of debt.
  The amendment we will vote on this afternoon is the bipartisan, 
bicameral consensus. Everybody knows it is the only one that has a 
chance of passing and the only chance we have of getting things under 
control. It is recommended to the American people by

[[Page S1857]]

us for their deliberation and their State legislatures by Americans of 
good will who will have reached across party lines to do what is right 
for our country's future.
  Some have suggested that it is somehow inappropriate to suggest that 
we amend the Constitution to correct the Federal Government's borrowing 
and spending habits. I would like to emphasize. What is the 
Constitution for? It seems to me that it's primary purpose is to limit 
the Federal Government's power to act in ways destructive of the 
liberties of the people. And the most central power of Government, 
especially of the Congress, is the power of the purse. That should not 
seem like a new idea. Ever since the nobles of England forced King John 
to sign the Magna Carta at Runnymede, our constitutional history has 
been a series of actions to rein in the abuse of power of the purse to 
protect the freedoms of the people. That is what we want to do here 
because it is apparent. If you look at these last 28 years of budgets, 
all unbalanced, none of which has done the job, that have put us where 
we are, it wasn't just Reagan, Bush, Clinton, or Carter. It is 28 years 
of this. And, if you really want to stop things, yes, we have to have 
better Presidential leadership on the budget. But ultimately, the 
fiscal buck stops right here in Congress, and the Congress is the body 
that can't get its spending habits under control.
  For the first century and a half of our Nation's history our Nation--
it literally went without saying--the Government would only borrow in 
times of supreme emergency, and then would repay the debt in good 
times. That began to be abandoned in the 1930's and was entirely 
abandoned in the 1960's and 1970's. In 58 of the last 66 years, and for 
the last straight 28 years, the Federal Government has spent more money 
than it has taken in. Yet, we have these people coming to the floor 
saying, ``All we have to do is do it, and the President will sign it.'' 
Give me a break.
  Mr. SARBANES. Will the Senator yield for a question?
  Mr. HATCH. I do not have the time to yield, or I would be happy to. 
Let me just finish my remarks.
  This pile of books illustrate the nearly three decades of unbroken 
deficits. Think of it. Nearly 30 years in an unbroken line, and 58 of 
the last 66 years during good times and bad times the Federal 
Government has simply spent money that it didn't have. And, frankly, it 
is our fault in Congress for allowing this condition to continue.
  Some question. ``Who has this hurt? We owe the money to ourselves. It 
has no effect.'' Right? Wrong. It has hurt average Americans by 
reducing their wealth and by reducing the Nation's economic sovereignty 
as we have relied on foreign creditors, and foreign creditors are 
starting to control our country. Because the Government is competing 
for money to borrow, it has driven up the interest rates making home 
mortgages, student loans, and automobile loans even more expensive.
  The Joint Economic Committee has estimated that the average family 
will save about $1,500 if we implemented a balanced budget amendment. 
Our debt has made it more difficult for small businesses to grow and to 
expand, and so has decreased the number of new jobs that we might have 
created.
  In these and many other ways, real wealth has been taken away from 
the American people and from the American families throughout this 
country. Who else does it hurt? Certainly our children and our 
grandchildren. A child born today enters life with about $20,000 of 
debt as his or her share of our $5.3 trillion national debt. It has 
been estimated that this same child will pay $200,000 in extra taxes 
just to pay the interest on the national debt over the lifetime of that 
child. In fact, that child will pay over $94,000 in extra taxes just to 
pay the interest on the national debt, up until that child's first 18 
years are completed. These children did not get to vote on this debt 
and tax burden. They didn't vote on the spending programs that they 
will be paying for. Mr. President, I have called this ``fiscal child 
abuse,'' and that is exactly what it is. It is also taxation without 
representation in its purest form.

  The clear fact is that the Federal Government's debt habit is hurting 
current and future Americans. But in a way that avoids direct electoral 
accountability. By taking the easy course to borrowing, the Government 
can hand out Federal money without having to raise Federal money 
directly through taxes.
  Over the period of debt financing the Government has grown and has 
intruded itself into every area of life but has become even less and 
less accountable for the people. Some say, ``Let's just do it,'' 
meaning that we can balance the budget right now, if we will. We have 
tried all of that. Republicans, Democrats, and the White House have 
promised balanced budgets, and the debt just continued to go up. 
Democrats and Republicans promised balanced budgets, and the debt went 
up. We had recessions and wars, and the debt went up. We had peace and 
prosperity, and the debt went up. Since 1978, we passed no fewer than 
five major budgetary regimes to force us to balance the budget, and the 
debt went up.
  Just think about it. In the last Congress, we even passed a balanced 
budget. But the President vetoed it. And the debt went up again. We 
have tried promises. We have tried statutes. They don't work.
  Look at this stack of failed attempts of 28 straight years; 58 of the 
last 66 year of unbalanced budgets. ``Let's just do it'' just doesn't 
do it. That line may be great for selling sneakers, but it has not 
helped us to balance the budget. I will tell you that.
  We have a fundamental problem with the way our Government operates. 
We need a constitutional solution because that is what the Constitution 
is for--to fix basic problems of Government, and to limit the ability 
of Government to act in ways that are harmful to the people. It seems 
to me quite clear that to remedy this fundamental problem in our 
National Government that it is entirely appropriate to amend our basic 
charter to say to the Government, ``Stop spending our national 
inheritance.'' By limiting the Federal Government's ability to borrow 
and spend and spend away our American legacy, we will be protecting the 
liberties of all Americans.
  Mr. President, there is still time for Senators to reconsider their 
position. I hope that those who have shown that changing their minds is 
not out of character will think twice again and decide to vote the 
right way--in the way they promised their constituents, in the way they 
ran upon it, and in the way they were elected upon it. The balanced 
budget is the right thing to do for our children, our grandchildren, 
and for all Americans.
  I reserve the remainder of my time.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. SARBANES. Mr. President, will the Senator yield me 2 minutes?
  Mr. LEAHY. I yield 2 minutes.
  Mr. SARBANES. Mr. President, I simply want to make this observation.
  Well over half of those budgets that the Senator from Utah points to 
in that pile would have been in balance if we had a capital budget. The 
fact of the matter is we didn't--and don't--have capital budgets. State 
and local governments have capital budgets. Businesses and private 
individuals have capital budgets. But we have a budget accounting 
system that requires us to cover the capital items as well as the 
operating items. If we had done budget keeping the way everyone else 
does budget keeping, well over half of those budgets would have been in 
balance.
  He talks about young people being born with a debt hanging over them. 
They are also born with a tremendous number of physical assets that 
have been purchased that are available to them for their use--a 
transportation network, a communication network, a research and 
development network, and an educational infrastructure. All have been 
paid for by previous generations for their use out into the future.
  Mr. HATCH. Will the Senator yield on my time?
  Mr. SARBANES. Yes.
  Mr. HATCH. Is that why you want a capital budget? I guess it is so 
you can continue what you have been doing. Sure. So you can continue to 
just spend, and just call it a capital budget. My gosh. It suddenly 
dawned on me. I was starting to think maybe a capital budget was a good 
thing. But there is no bond rating system to restrain the Federal 
Government, as is the case in the States. We make the money. We

[[Page S1858]]

print it ourselves. We do whatever we want to. I guess we could just 
continue business as it is, and just call it a capital budget. Put all 
of these things that we should have to pay for into a capital budget, 
and say, ``We balanced the budget.'' Just continue the same system. 
That is what we are talking about.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Senator from Vermont.
  Mr. LEAHY. Mr. President, on my time, if we are going to go by 
rating, I say to my friend from Maryland, let's see how we would rate. 
I think probably one way of rating is our deficit as a share of GDP. I 
say this because we do it for ourselves. We talk about having our 
household budgets in line. As a U.S. Senator, I own a home, of course. 
But my real home is in Vermont. But I have a home to use when I am down 
in the Senate. Now, I do as almost all Vermonters, unless they have a 
lot more money than I do. I buy that with a mortgage. I could not pay 
for those homes all in 1 year. I am in deficit.

  Mr. SARBANES. If the Senator will yield.
  Mr. LEAHY. I am in deficit on that.
  Mr. SARBANES. Exactly. The year the Senator took out the mortgage, he 
was in violation of the concept of the balanced budget amendment to the 
Constitution.
  Mr. LEAHY. Exactly.
  Mr. SARBANES. Any business that borrowed to expand plant and 
equipment--and virtually all businesses do it--violates the concept of 
this balanced budget amendment to the Constitution.
  Mr. LEAHY. In fact, I might say to my friend from Maryland, we talk 
about how they might rate us if we had a capital budget. I look at the 
chart that he has been good enough to bring up, and I think that the 
United States is rating pretty darned good. We are an awful lot better 
in our deficit than all the rest of the First World--Japan, Germany, 
Canada, France, UK, Italy. I think our bonds would be pretty darned 
good. I say this to my friend from Maryland. We all know we are in 
about as much of a global market certainly as at any time in the 
Senator's lifetime or my lifetime, and markets become even more global 
as we go on with everything from the Internet to plants worldwide. I 
ask my friend, what is the dominant currency when we talk about that 
global market? Is it not the dollar?
  Mr. SARBANES. If the Senator will yield, it is certainly the dollar. 
Everyone is anxious to hold U.S. Treasury bonds. Let me say to my 
colleague, the Maastricht Agreement for the European Union set out 
certain criteria that countries had to meet in order to qualify for the 
monetary unit. These were regarded as extremely severe criteria. One 
criterion set out in the Maastricht Agreement was that they had to 
bring their deficit as a share of GDP down to 3 percent--3 percent. 
That is the target that those countries are working to achieve. 
Everyone says, well, that is a really tough standard that these 
European countries are trying to meet.
  The United States is at 1.4 percent.
  Mr. LEAHY. We have cut in half what they have set as that tough 
target. We have done half again better. Is that what the Senator from 
Maryland is saying?
  Mr. SARBANES. The Senator is absolutely correct. Another criterion 
they had was that your debt, your total debt had to be at 60 percent of 
your GDP. We are at 50 percent. I do not have a chart on that one. But 
we are at 50 percent. We easily meet both of the criteria that are 
being used by the European countries pursuant to the Maastricht 
Convention guidelines. And everyone is saying, boy, this is a tough 
job. If you get to it, you are showing tremendous fiscal discipline.
  We are already well within both of those targets. None of the 15 
countries that are members of the European Union have done as well as 
the United States on these two criteria, with the exception of 
Luxembourg.
  Mr. LEAHY. Mr. President, I see now that my distinguished colleague 
from Utah has someone to speak on the other side. I am about to yield 
to him. I hope, though, that those who watch this debate around the 
world will realize that we are making debate on what is the world's 
strongest economy, the strongest economy recorded history has ever 
shown. I worry sometimes when I hear this denigration of our economy 
and that we need gimmicks to fix it. It is like some of the debate on 
the military budget during the cold war: Oh, my God, we are falling so 
far behind, until someone said, well, would we trade our Air Force for 
the Soviet Air Force or our Navy for the Soviet Navy or our Army for 
the Soviet Army? And everybody said, Oh, of course not. I ask just one 
question. Would we trade the U.S. economy for any economy in the world?
  I yield the floor.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. The only gimmicks I have seen are the gimmicks of these 
amendments that are really filed for one purpose and that is to cover 
what really is a very difficult vote, voting against the balanced 
budget amendment.
  I yield 4 minutes to the distinguished Senator from Tennessee.
  The PRESIDING OFFICER. The Chair recognizes the Senator from 
Tennessee.
  Mr. FRIST. Mr. President, I rise today in strong support of Senate 
Joint Resolution 1, the balanced budget amendment to the Constitution. 
I especially want to commend my good friend, Senator Hatch, for his 
tireless dedication to passing this amendment.
  Mr. President, our Nation faces a critical choice about our economic 
future: Are we going to continue to shackle our children and 
grandchildren with debt or are we going to curtail the excessive 
spending habits of Washington? Passing the balanced budget amendment 
signals a choice for fiscal discipline, economic prosperity, and a 
better future for our children.
  Federal spending cannot continue indefinitely on its current course. 
If we continue on our current path, entitlements and interest on the 
debt will consume all Federal revenues by 2012--leaving not a single 
tax dollar for defense, education, medical research, national parks, 
and other important government functions. For 28 years, we have 
continued on this path. We cannot continue on it for the next 28.
  Today, the Federal debt stands at $5.3 trillion. Grasping the concept 
of a trillion dollars is difficult, but let me try. If you started a 
business in the year 1 and that business lost $1 million every day 
since then, you still would not have lost your first trillion dollars. 
Paying interest alone on America's debt costs taxpayers about $300 
million a year. Thus, a child born today will pay more than $180,000 on 
the debt over his or her lifetime--just in interest.
  The balanced budget amendment will take a bold step toward reversing 
this trend by adding a simple rule to the Constitution, a rule followed 
by families when they draw up their own budgets and by businesses when 
they forecast their finances. This rule says, ``total outlays in a 
particular year will not exceed total receipts in that year.'' That is 
legalese for forcing Congress to live within its means.
  Some people have asked me why Congress and the President need to 
enshrine this rule in a document as important as the Constitution. 
Especially given today's new commitment to bipartisanship, some wonder 
why their lawmakers cannot agree to make the tough choices necessary to 
balance the budget. The simple answer is that Congress and the 
President need the amendment to guarantee fiscal discipline whether or 
not that political commitment to a balanced budget exists. We need the 
amendment to ensure the budget is balanced in 2002 and 2012 and 2022.
  Opponents of the amendment cite four objections. First, they claim we 
should exempt Social Security from budget calculations to protect 
seniors and preserve the program. However, exempting Social Security 
from the balanced budget amendment will not strengthen Social Security 
in any way, will not add a single year to the Social Security trust 
fund, and will make balancing the budget even more difficult. Simply 
moving Social Security off budget does not address the structural 
challenges the program will face when the baby boomers begin to retire. 
The President knows this. He cites Social Security as one of his 
reasons for opposing the amendment but does not exempt it in his own 
budget. The greatest threat to Social Security is not the

[[Page S1859]]

balanced budget amendment; it is the unrestrained growth of debt that 
jeopardizes every single Federal program, especially Social Security 
because it is the largest.
  The second objection is that the amendment restricts our ability to 
run deficits in times of emergency or recession. Running deficits is, 
at times, unavoidable. But recent budget history shows that deficit 
spending has become the rule rather than the exception in Washington, a 
trend that is unacceptable to the American taxpayer. The first sentence 
of the amendment provides appropriate flexibility to permit deficits 
when a three-fifths majority of Congress deems it necessary.
  Third, opponents claim that the amendment risks judicial interference 
in budget decisions. In his State of the Union Address, the President 
himself cited his concern of ``unwanted results such as judges halting 
Social Security checks.'' The balanced budget amendment does not 
allocate power to the courts to decide budget and economic matters. 
Rather, it establishes a procedure to restrict Congress' budget 
authority--a supermajority vote to run deficits.
  Fourth, opponents say we should include an exemption for capital 
budgets. Capital investments are very important. Everyone knows that. 
However, as I discussed earlier, we will have no money for capital 
investments in just 15 years if we continue on our current budget 
course. As with Social Security, the debt is the greatest threat to 
these investments.
  Furthermore, if we created a separate capital budget, the process of 
defining ``capital spending'' could be abused--opening a huge loophole 
for deficit spending. We have seen this happen in the States. In New 
York City, for example, they declared the useful life of a school 
textbook to be 30 years, stretching out spending far beyond the book's 
actual existence.
  All of these arguments are a smoke screen that obscures the real 
issue at stake: constitutionally mandated fiscal discipline.
  If we can enact and sustain this discipline, the economic rewards are 
considerable. Looking back, if we had not run deficits the past two 
decades, the average American family's annual income would be $15,500 
higher. Looking ahead, if we balance our budget now, we can increase 
per capita income by 26 percent over the next 20 years.
  Passing the balanced budget amendment represents the first step down 
this road to economic prosperity. With a fiscal discipline embedded in 
the Constitution, Congress will be forced to confront tough problems 
sooner--rather than pushing mountains of debt on to future generations 
to endure.
  I urge my colleagues to pass the balanced budget amendment.
  Mr. HATCH. I thank my colleague for his excellent statement, Mr. 
President. I yield 6 minutes to the distinguished Senator from 
Virginia. And I want to personally thank him and express my gratitude 
for the good leadership and hard work he has shown in trying to pass 
this amendment.
  The PRESIDING OFFICER. The Chair recognizes the Senator from 
Virginia.
  Mr. ROBB. Mr. President, I must confess that I am not particularly 
comfortable as a proponent of adding a balanced budget amendment to the 
Constitution, and I never have been.
  Many of those with whom I am frequently aligned on issues that don't 
enjoy much popular political support yet represent sound public policy 
are very much opposed to this amendment--and cannot understand why I am 
supporting it.
  But I am not persuaded by the impassioned arguments against it, and, 
regrettably, that leaves me at odds with the President, the leadership 
of my party, most editorial writers, and virtually all of the 
progressive organizations with which I often find common cause.
  It was out of frustration that I first came to support the amendment 
well over a decade ago during the time the Federal Government began to 
run huge annual deficits year after year, with no evidence of the 
discipline necessary to rein them in and I have been a reluctant backer 
ever since.
  As most of our colleagues know, however, I've always been far more 
committed to a balanced budget than to a balanced budget amendment and 
I would not be supporting an amendment now, if I held out any hope that 
we would actually reach that goal without it.
  In truth, actually achieving a balanced budget will be extremely 
difficult and there is no guarantee that we'll reach it, with or 
without the amendment, because we will have to make some politically 
painful decisions to get there--either way.
  And that is really the point.
  Why fear the amendment if it will only put more pressure on us to 
make the same tough decisions we're going to have to make anyway if 
we're serious about balancing the budget.
  We owe it to the American people, and to future generations in 
particular to be a whole lot more candid about the choices we face, and 
the decisions we are going to have to make.
  We cannot keep promising that we will not touch Social Security or 
Medicare or Medicaid or veteran's pensions or any other entitlement 
program, because we are going to have to make some adjustments to all 
of these programs, or we will put them all at risk.
  I am particularly concerned about arguments that suggest we threaten 
Social Security if we pass a balanced budget amendment. That is just 
not true.
  The greatest risk for Social Security is not taking the need to 
balance the budget seriously.
  The real threat to our security, to our Social Security, to our 
economic security, and to our national security is the national debt.
  Each year we pay more interest, on more debt, and that leaves fewer 
dollars to spend on everything else we look to Government to provide.
  And if we don't make some changes soon, in just 15 years every cent 
the Government takes in will be required just to pay for entitlement 
programs and interest on the national debt--every cent.
  Now that is really something to worry about.
  The other argument heard so often is that the balanced budget 
amendment, will not permit us to respond to national emergencies.
  That is nonsense.
  To be sure it is designed to increase the pressure on us to make the 
politically difficult choices we keep avoiding.
  But for any real emergency we can override it with 60 votes, as we 
have in the past.
  Just look at how many votes we get on our routine emergency 
supplemental appropriations bills.
  In times of true national emergencies, we will have virtually 
unanimous support to waive the limitation and in the interim, we will 
have an added incentive, to be more fiscally responsible.
  Mr. President, notwithstanding good intentions and despite the 
rhetoric to the contrary, I just do not believe either the executive 
branch of the Federal Government or the legislative branch of the 
Federal Government have the collective will to make the really tough 
but necessary decisions without the added pressure the balanced budget 
amendment will help guarantee.
  So, the die may well be cast. It may be it will fall one vote short. 
But I hope all of those who profess to support a balanced budget, 
whether with or without an amendment, will keep those commitments in 
mind as we approach the very difficult choices that we inevitably face 
if we are ever to get to that particular goal.
  Mr. President, I yield any time I have remaining, and I thank the 
Chair.
  Mr. DOMENICI addressed the Chair.
  Mr. HATCH. How much time does the distinguished Senator from New 
Mexico need? We are running out of time on this side, but I think the 
distinguished chairman of the Budget Committee deserves to take 
whatever he wants to.
  Mr. DOMENICI. Mr. President, 7 or 8 minutes?
  Mr. HATCH. All right, I yield 8 minutes to the distinguished Senator.
  The PRESIDING OFFICER. The Chair recognizes the Senator from New 
Mexico.
  Mr. DOMENICI. Mr. President, I just listened to my good friend from 
Virginia talk about whether we have the will or not without a 
constitutional amendment mandating a balanced budget. Let me say to 
everyone, the

[[Page S1860]]

President of the United States has been saying he has the will; the 
will to get a balanced budget by 2002 has been a cornerstone to what he 
has been saying during his campaign and during the last couple of 
months.
  The truth of the matter is, I say to my friend from Virginia, he did 
not present a balanced budget. Last night, the Congressional Budget 
Office told us that the President's budget, in the last year, the year 
it is supposed to be in balance, is $70 billion in the red. You know, 
we are only starting this exercise at $106 billion. Mr. President, $106 
billion is where we are, and after all the Presidential hoopla, sending 
us this great budget, those who estimate say it is still $70 billion in 
the red in 2002.
  If that is not enough, let me tell you, the will seems to be to 
delay, delay, delay. A constitutional amendment would put a finality to 
that and you would reach the time when you could delay no more, which I 
believe is the reason that my good friend has decided that he must go 
for this amendment, even though we would all prefer to balance the 
budget on our own. Is delay part of the President's budget, while he 
admonishes us not to adopt a constitutional amendment? You bet. The 
Congressional Budget Office just told us that next year, the first year 
we are supposed to be moving toward balance, the deficit goes up $25 
billion. Can you imagine a deficit increase, from a President telling 
us not to adopt a constitutional amendment because it is too rigid and 
he would like the flexibility, and stating he just sent Congress a 
balanced budget?
  My friend, Congressman John Kasich, tried to explain this, and I must 
borrow his analogy. He talked about somebody going on a diet and 
deciding that the first 4 years of the diet, you will increase your 
weight preposterously--$25 billion worth, in the first year--and then 
when you finally get to the year you are supposed to actually lose 
weight, you all of a sudden, in that last year, you are going to lose 
100 pounds.
  This budget is before us now, brought to us by a President who is 
telling us, I will balance the budget myself--right? That is what he is 
saying. Do you know how much of this deficit reduction, according to 
the experts that we must listen to, occurs in the last 2 years of this 
budget? I assume you were appalled, I say to Senator Robb, when you 
heard 75 percent as the estimate 2 weeks ago. That is wrong. Mr. 
President, 98.5 percent of the President's deficit reduction occurs in 
the fourth and fifth year of this budget. Do you believe it? Do you 
believe that will happen? Of course not. You will have another budget 
stacked up here, saying, ``Well, we thought we were getting there, but 
we are not.''
  As a matter of fact, the response of the administration today is, we 
are not changing a thing because, come that final year, we have a 
trigger. Did you ever hear of a trigger in budgeting? You pull a 
trigger and you cut spending. Why don't you pull the trigger next year 
and start cutting spending? You wait until the end and you ``trigger'' 
out--neat word--trigger out the tax cuts that you put in place. So you 
raise taxes, because you were wrong and you could not get to balance, 
so you say, we will cut your taxes for 3 years but in the fourth and 
fifth years, when we are out of balance, we will put the taxes right 
back on. That is a neat trigger, isn't it? It is a trigger, so clearly 
we ought to be down here saying, ``We do not need a constitutional 
amendment" --this is a new one--``we have a trigger. Forget the 
amendment. We will balance the budget with a trigger.''

  And then the President says, ``Of course, we cannot do it all by 
taxes.'' So, what we are going to do is we are going to trigger an 
across-the-board cut, 4 percent across-the-board on almost everything. 
Do you believe it? Of course not. It will not happen. It is an absolute 
phony device.
  For those who think we do not need a constitutional amendment because 
we will balance the budget ourselves, I submit, with great regret, that 
the President's budget is not an example of doing it ourselves, for it 
will not achieve the goal. As a matter of fact, it obfuscates, it 
hides, it delays, it terminates a bunch of programs.
  One big program is terminated in the fifth year, even though it is an 
entitlement. And guess the rhetoric? The rhetoric is, ``Well, the 
President promised to do it for only 5 years in his campaign, so it is 
in the budget for 5 years.'' A new entitlement, but at the end of 5 
years, it is out. That won't happen. You already have hundreds of 
thousands of Americans on this entitlement to help pay for health care 
of one type or another. But because we had a campaign that said we are 
going to do this for 5 years, we will stop it.
  You see, the President has just given us, in his budget, I regret to 
say, the best example of why we need a constitutional amendment. We 
just absolutely cannot put ourselves to making tough decisions. I say 
to those negotiating for the President, I remain hopeful that there are 
two things at play that may still get us to the Holy Land, and the two 
things are that this President cannot live with 4 years of a sustained 
fight with a Republican Congress--he cannot--because what kind of a 
legacy is that? ``I did battle with the Republicans for 4 years, and 
that is my legacy.'' Of course that is no legacy. Nor can the 
Republicans who control this place--and thanks to Senator Robb for 
helping us on these matters. We don't draw lines. He is one of the most 
committed Senators to getting a balanced budget, and I compliment him 
for it. But we can't live fighting the President for 2 years or 4 
years. So I think maybe the pot may be able to get stewed up moving in 
the right direction of getting a balanced budget.
  Let me say, for those who claim we will do it ourselves, they better 
do a lot better than the President, because he is not doing it himself. 
His budget needs a constitutional amendment almost as bad as any of 
those budgets we have up here. How many years is that, I ask the 
Senator from Utah? Twenty-nine? Twenty-eight? We probably need it as 
bad on the President's budget as any of those budgets out here which 
caused us to go into this 5 trillion dollars worth of debt.
  Mr. HATCH. Will the Senator yield?
  Mr. DOMENICI. I will be delighted to.
  Mr. HATCH. The President himself, in his budget, says by the fourth 
and fifth year, 75 percent of the savings or cuts, whatever, have to be 
obtained in the 2 years after he leaves office.
  Mr. DOMENICI. Actually, it is 98 now. I gave you a new number.
  Mr. HATCH. I was going to ask you, you said 98. He was off by that 
much?
  Mr. DOMENICI. That's correct.
  Mr. HATCH. He himself admitted to 75 percent.
  Mr. DOMENICI. The number in his budget was 75. Now we have another 
party, a neutral party saying----
  Mr. HATCH. Am I correct in my understanding? I was led to believe 
there was only a $49 billion deficit in the fifth year of the 
President's budget; in other words, it wasn't balanced by $49 billion. 
If I heard the distinguished Senator correctly, that is now up to $70 
billion, according to the Congressional Budget Office?
  Mr. DOMENICI. That's correct.
  The PRESIDING OFFICER. The 8 minutes have expired.
  Mr. HATCH. I don't know when I have heard a better speech on the 
balanced budget amendment than the Senator from New Mexico has just 
given, or a better set of arguments for it.
  Mr. DOMENICI. I know I don't have any time left, but I would like to 
repeat something. Can I just have 30 seconds?
  Mr. HATCH. I yield 30 seconds.
  Mr. DOMENICI. Mr. President, the best thing the President can offer 
in his budget, in lieu of a constitutional amendment to do the job, is 
a trigger. This trigger is not going to get us where we have to be, but 
it is the only answer the President has to saying he will get us there. 
There is a newfangled procedure in budgeting that says when the time 
comes to do what we should have already done, we will use a gun and we 
will call it a trigger, and we will automatically cut things that we 
didn't have the courage to do anything about for the 4 preceding years.

  Now, that is not doing it yourself and it is not anything that would 
justify our throwing away this constitutional amendment. However, I do 
believe we are not going to pass it because I think those opposed to it 
are still convinced we need bigger Government, and the constitutional 
amendment is an instrument for less Government rather than more, and 
that is the reason we are going to lose. I yield the floor.
  Several Senators addressed the Chair.

[[Page S1861]]

  The PRESIDING OFFICER. The Chair recognizes the Senator from Vermont.
  Mr. LEAHY. Mr. President, I will not take long. I hear these debates, 
and I still say the same thing: All we need is the courage to vote. We 
all give great speeches about the need for a balanced budget, but I 
remember the Senate and the Senate leadership during the time of 
President Reagan endorsing huge deficits. In fact, we are still paying 
the interest on the deficits run up during the Reagan and Bush 
administrations, as contrasted to the Clinton administration where the 
deficit has come down 4 years in a row and is about to come down for 
the fifth year, something that has not happened in the lifetime of most 
of us in this body.
  But to bring it down, you don't pass a bumper-sticker slogan and 
stick it on the Constitution of the United States of America. To bring 
it down, you cast difficult votes, unpopular votes, votes that make you 
stand up to special interests and single-issue groups from the right to 
the left.
  What we are trying to do is to pass some kind of a feel-good 
amendment that would send most of this to the courts, that would 
cripple the strongest economy in the world. Let us remember that, with 
all those who come and talk about the dangers of our economy, I ask 
them, what country in the world would they trade economies with? We 
have the strongest economy in the world. It is like the days of the 
Soviet Union when everybody said, ``Well, our military is falling 
apart,'' and we say, ``Do you want to trade our Air Force for theirs, 
our Army for theirs, our Navy for theirs?'' We have to say no.
  When we have the strongest economy in the world, when we have a 
deficit that is the smallest as percentage of our gross domestic 
product of any in the industrialized world, let's not start talking 
about trading what is working for countries that do not work anywhere 
near as well as what we have. Let us back off from the political siren 
call of saying, ``We'll do this on a bumper-sticker slogan slapped on 
to the Constitution,'' the greatest Constitution in the world, because 
then some day somebody else, probably a Federal court, will do what we 
can do today.
  I know that we cannot legislate political courage and responsibility, 
but that is what we are trying to say we are going to do. No amendment 
to the Constitution can supply the representatives of the people of 
this great country with political courage and responsibility. Indeed, 
the majority report on this amendment concludes that the ultimate 
enforcement mechanism that can lead to balancing the budget is the 
electorate's power to vote. How true, but that power to vote doesn't 
come in 10 years from now in a constitutional amendment. That power to 
vote has been there throughout the history of this great country. The 
underlying resolution would actually cut, rather than enhance, our 
democratic principles of majority rule and separation of powers but 
ultimately lead to less accountability to the electorate. Why would it 
do that? Because it would destroy majority rule, and it would turn all 
contested issues of the budget over to the courts, not to the elected 
people of this country.
  Political courage has been an essential ingredient that has helped us 
achieve remarkable deficit reduction over the past 4 years. That is a 
history that those who support this flimflam on the Constitution choose 
to ignore. We have succeeded in reducing the deficit every year of the 
past 4, we have cut the deficit by more than 60 percent in that time, 
and we have had a strong economy and sound fiscal policy. We did not do 
that through a flimflam amendment. We did that through political 
courage. It meant that some Members of this body and some Members of 
the other body actually lost their seats in the Congress by voting for 
what was right--but they did it--and reminds all of us that nobody owns 
a seat in the U.S. Senate. Nobody should have their decisions guided 
solely by polls, but rather by what is right.

  So why do we not stay the course of what we have been doing, bringing 
the deficit down and use bipartisan work for further progress? It is an 
illusionary quick fix by constitutional amendment, and it makes the job 
more difficult.
  The questions raised during this debate will not go away and cannot 
be ignored. They point to a series of fatal flaws in proposing and 
conducting our economic and budgetary functions this way.
  A recent editorial in Vermont by the Burlington Free Press said it:

       Amending the Constitution to require a balanced budget 
     amendment would be like using a sledgehammer to nail a picket 
     in a fence. The picket might stand, but at great risk to the 
     fence.

  I think of what Senator Hatfield said when he stood up and opposed 
this. Senator Hatfield, then the chairman of the Senate Appropriations 
Committee, said:

       The debate on the balanced budget amendment is not about 
     reducing the budget deficit. It is about amending the 
     Constitution of the United States with a procedural gimmick.

  What I say is, it is amending the Constitution with a bumper-sticker 
flimflam. That is what it is doing.
  Senator Hatfield said:

       As I stated during the debate on the balanced budget 
     amendment last year, a vote for this balanced budget 
     amendment is not a vote for a balanced budget, it is a vote 
     for a figleaf.

  Mr. President, it is a pretty small figleaf. We ought to be 
embarrassed to put that figleaf on anything, especially on the greatest 
Constitution democracy has ever known.
  Senator Hatfield said:

       Congress should not promise to the people to balance the 
     Federal budget through a procedural gimmick. If the Congress 
     has a political will to balance the budget, it should simply 
     use the power that it already has to do so. There is no 
     substitute for political will. And there never will be.

  Our Senate oath of office has in it a promise to support and defend 
the Constitution of the United States. We owe to our constituents our 
best judgment on this. We owe to our children and our children's 
children our best judgment.
  My children will live most of their lives in the next century. I want 
them to live in that century with the best Constitution democracy has 
ever known. We demean the Constitution with this amendment. I yield the 
floor.
  Mr. HATCH addressed the Chair.
  The PRESIDING OFFICER. The Senator from Utah.
  Mr. HATCH. I yield 6 minutes to the distinguished Senator from 
Oklahoma.
  The PRESIDING OFFICER. The Chair recognizes the Senator from 
Oklahoma.
  Mr. NICKLES. Mr. President, I would like to thank my colleague, 
Senator Hatch, for his outstanding leadership on this very important 
constitutional amendment to balance the budget, as well as Senator 
Craig and others who have worked very hard to put us in a position to 
be able to pass this amendment.
  Mr. President, I have been here now for 17 years. I cannot think of a 
more important vote that I have ever cast than the vote we will be 
casting today. If we cast a vote in favor of passing a constitutional 
amendment to balance the budget, we will change the way we do business 
in Washington, DC.
  When we are sworn into office, we stand right here on the floor of 
the Senate, most of us with a hand on the Bible, saying we swear to 
uphold the Constitution of the United States. It will change the way we 
do business. It will mean we are going to start being responsible; we 
are going to quit spending more than we take in. It will not be easy. 
It will be a challenge, but we can do it. Almost all States do it. It 
does not mean it is easy, but they do it. And we should do it as well.
  I will read something from Thomas Jefferson.

       I wish it were possible to obtain a single amendment to our 
     Constitution. I would be willing to depend on that alone for 
     the reduction of administration of our Government to the 
     genuine principles of its Constitution; I mean an additional 
     article, taking from the Federal Government the power of 
     borrowing.

  Thomas Jefferson was right. He also said:

       The question whether one generation has the right to bind 
     another by the deficit it imposes is a question of such 
     consequence as to place it among the fundamental principles 
     of government. We should consider ourselves unauthorized to 
     saddle posterity with our debts, and morally bound to pay 
     them ourselves.

  He was exactly right.
  Mr. President, there is an article where countless Presidents, almost 
every President when they made a State of the Union Address, said they

[[Page S1862]]

were going to lead us toward a balanced budget, including Bill Clinton, 
including Ronald Reagan, including George Bush, including almost all 
Presidents. But, unfortunately, we have not done it. And I say we. It 
is not just the administration. It is Congress. I think we need the 
constitutional constraint to get us there.

  In the last election, President Clinton and Bob Dole said, hey, we 
need a balanced budget. Some people said, well, that means that it is a 
done deal. That is not really the case. I heard my colleague and 
friend, Senator Leahy, say, well, the last 4 years we have brought the 
deficit down. The deficit has come down. What he did not say is the 
deficit last year was $107 billion. What he did not say is the next 4 
years it goes up. According to CBO, the deficit goes up from $107 
billion to, in 1997, $116 billion, and under President Clinton's budget 
to $142 billion in 1999, and $135 billion in the year 2000.
  Mr. LEAHY. Would the Senator yield?
  Mr. NICKLES. No; I have only a couple minutes. I will be quick.
  The point is, even under the President's budget, the deficit goes up. 
We have made some progress--and I think we can argue on who should take 
credit for that--but we are not making progress when the deficit is 
going up and it is higher in the year 2000 than it is in the year 1996. 
That is not balancing the budget. That is like somebody saying they are 
going to go on a diet, but first they want to gain 10 pounds for each 
of the next 3 years and, oh, yes, in the last year we are going to lose 
40 pounds. That is what we have before us under the President's 
document.
  I think we need a constitutional amendment to make the President and 
to make Congress be responsible, to make the tough decisions.
  I am pleased that we are going to have 55 Republicans vote for this. 
I am disappointed that we do not have 12 Democrats to vote for it to 
make it happen. I wish we did. I think we are going to come up with 11. 
One of my jobs is to count votes. A couple of people basically are 
going to vote different than what they said they were going to do. That 
disappoints me. But regardless, we still have to roll up our sleeves, 
and I think we still have to balance the budget. I do not know there is 
the collective will to do it unless we have the constitutional 
restraint to make us do it.
  When an administration campaigns on a balanced budget and says, ``Oh, 
yes, we brought the deficit down every year,'' and then have the 
deficit go up in the next 4 years, I find a lot of shell games going on 
in budgeteering. That bothers me. I hope we will be responsible. I hope 
we will work together as Democrats and Republicans, not have a 
Republican budget, not have a Democratic budget, but work together to 
actually balance the budget and provide some tax relief. We can do it. 
But it is a lot easier said than done.
  I think we need a constitutional amendment to make us do it, to tell 
us to do it. One of the reasons I think we continually have a deficit 
is you are a lot more popular spending money for people than taking it 
away from people.
  Mr. President, I believe this is one of the most important issues we 
will have confronting us this Congress, maybe in our lifetimes. If we 
really do want to have Government act responsibly and quit saddling our 
children with additional debt --right now, per capita, that debt is 
over $19,000 per child, per person, per American. I do not think it is 
responsible for us to continue to add more debt on future generations. 
So I urge my colleagues to support a constitutional amendment to 
balance the budget later this afternoon. I yield the floor.
  Mr. LEAHY addressed the Chair.
  The PRESIDING OFFICER. The Chair recognizes the Senator from Vermont.
  Mr. LEAHY. Mr. President, I am sorry the Republican whip was unable 
to yield to me for an observation, but I will make this observation. He 
condemns President Clinton, who is the only President since he has been 
here in the Senate who has brought the deficit down 4 years in a row. 
He says it may go up in future years. I remind the Republican whip, my 
good friend from Oklahoma, that the Republicans have the majority of 
Senators and the Republicans have the majority of House Members. If 
they do not like the budget of the President, all they have to do is 
pass their own. But to this day they have not brought forward one page, 
one paragraph, one sentence or one word of a budget that would do 
better than what Bill Clinton has done.
  Mr. NICKLES. Will the Senator yield?
  Mr. LEAHY. We are now running out of time. I am going to have to do 
the same thing that the Republican whip did to me in not being willing 
to yield. I yield 5 minutes to the distinguished Senator from Arkansas.
  Mr. BUMPERS. I thank the Senator. No. 1, Mr. President, as much 
respect as I have for a number of Members of the Senate--and we have 
some very bright people in the Senate--there isn't anybody here, 
really, that I want tinkering with what James Madison, John Adams, 
Alexander Hamilton, and all of the rest of those brilliant people, the 
most important assemblage of brilliant minds under one roof in the 
history of the world, did. Not only do I not want anybody tinkering 
with it, I do not want to adopt something as sloppily crafted as this 
amendment is.
  As Senator Byrd has said time and time again, it is not even 
constitution-like language. It doesn't provide for a simple majority 
vote to unbalance the budget in case of depression. It doesn't provide 
for a simple majority vote in case we know we are going to war, as we 
did in Desert Storm. You would not have spent an extra dollar, under 
this amendment, to prepare for Desert Storm. You could not spend an 
extra dollar to have prepared for World War II, which everybody knew 
was coming, if it unbalanced the budget.
  You talk about a minority, listen to this, Mr. President. With 435 
House Members, 100 Senators, if we want to unbalance the budget, it is 
going to require 60 percent of both Houses. Let's assume that every 
single House Member, all 435, vote aye to unbalance the budget, bring 
it over to the Senate, and let us assume that 59 Senators vote aye to 
unbalance the budget, 41 obstreperous Senators--494 people favoring 
unbalancing the budget and 41 Senators oppose it. It will not be 
unbalanced.
  What else? If we can't resolve the thousands of questions that this 
amendment leaves to be answered, then nobody has an answer and you go 
to court. Yes, coffee shop bantering is, ``I'm so tired of the courts 
making laws. I just want them to interpret the laws.'' Well, they are 
going to have to make a lot of laws if we are foolish enough to adopt 
this one.
  In 1993, the Republicans in this body had an opportunity to do 
something courageous. The people back home always say, ``Why don't you 
people screw up your nerve and do something courageous?'' You know what 
that means? It sometimes means unpopular votes. ``Why don't you screw 
up your courage and vote for something that is worthwhile, even though 
it is unpopular?'' Well, happily, 50 Democrats did just that. Al Gore, 
the Vice President, broke the tie and the debt went down because of 
their courage. Everybody on that side prospered because they said, 
``I'm tired of taxes.'' Do you know what they are proposing now? With a 
sanctimonious look on their faces, they are saying, ``We want a 
balanced budget amendment.'' What else? We want to cut taxes $238 
billion over the next 5 years. We tried that snake oil in 1981, and we 
got a $3 trillion addition to the national debt.
  What is the deficit going to be if we adopt a capital gains tax, 
which costs $33 billion the first 5 years, $133 billion the second 5 
years--and who does it go to? The wealthiest people in America; 67 
percent of it goes to the richest 1 percent of the people in America. 
How are we going to pay for it? Cut Medicare. Think of it. Cutting 
Medicare $100 billion to $200 billion in order to pass a tax, 67 
percent of which goes to the richest 1 percent of the people in 
America. I will say one thing for the people on that side of the aisle. 
They are not covert about it; they are overt. Make no mistake about it, 
I have just told you precisely how it will work.
  So, Mr. President, I am hoping that everybody holds fast. If we can 
beat this amendment today, which I think we can do, the American people 
are going to begin to hone in on it, and by this time next year, you 
won't even have it brought up. It will be just like term limits. It is 
going to go the same

[[Page S1863]]

way term limits went. That never was a good idea, and it is dead now.
  So, Mr. President, I hope my colleagues will stand fast. I understand 
the politics of this. The majority leader was willing to tinker with 
this amendment. ``I will fix it. Will anybody vote for it if I change 
this?'' ``Will somebody else vote for it if we change that?'' That is 
how political it is.
  I yield the floor.
  Mr. HATCH. Mr. President, I yield 5 minutes to the distinguished 
Senator from Idaho.
  Mr. CRAIG. Mr. President, I thank my colleague for yielding.
  Let me say to the Senator from Arkansas, if our Founding Fathers were 
here today, they would suggest that Thomas Jefferson was right. They 
would also have suggested that tinkering with the Constitution gave us 
the 13th amendment, which abolished slavery. I know the Senator from 
Arkansas would agree with me that it was a good amendment. He would 
probably also agree that the 19th amendment, when Congress tinkered 
with the idea that women should have a right to vote, was the right 
thing to do. Tinkering, generationally, has produced 27 amendments to 
our Constitution that, my guess is, the Senator from Arkansas and the 
Senator from Idaho would agree were generally the right things to do at 
those times in our Nation's history.
  Mr. President, I rise in support today of what could become the 28th 
amendment to our Constitution. Let me thank the leadership that has 
worked so hard on this. Of course, there is Senator Orrin Hatch, the 
chairman of the Judiciary Committee; our majority leader, Trent Lott; 
majority whip, Don Nickles; the President pro tempore; certainly, the 
Senator from Nevada, Senator Bryan; Senator Graham from Florida; the 
Senator from Illinois, Carol Moseley-Braun. They deserve recognition 
for bringing this critical issue to the floor. It is not a sunshine 
amendment. I first helped introduce this in 1982. It will not go away 
tomorrow. If we fail today, we will be back next year and the next and 
the next, until the American people gain their wish, which is to 
convince this Congress, with the power of the Constitution, that we 
should become fiscally responsible.
  Let me also recognize the national, grass roots coalition that was 
formed under the leadership of Al Cors of the National Taxpayers Union 
in support of this amendment. I ask unanimous consent that a letter 
from that coalition be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:
                                               The Balanced Budget


                                          Amendment Coalition,

                               Alexandria, VA., February 26, 1997.
       Dear Senator: The undersigned organizations strongly urge 
     you to vote for and support the Balanced Budget Amendment, 
     S.J. Res. 1. This bipartisan proposal (with over 60 total 
     Senate cosponsors) has already passed the Senate Judiciary 
     Committee on a 13 to 5 vote, and a Senate vote on S.J. Res. 1 
     is expected later this week.
       The framers of the U.S. Constitution assumed each 
     generation of Americans would pay its own bills--and that the 
     federal budget would, over time, remain roughly in balance. 
     According to Thomas Jefferson, ``we should consider ourselves 
     unauthorized to saddle posterity with our debts, and morally 
     bound to pay them ourselves.''
       In today's era of mass media, special interest politics, 
     and expensive and sophisticated election campaigns, the 
     checks and balances established 200 years ago are not up to 
     the job of controlling the federal deficit. Recent Congresses 
     and presidents have proven themselves incapable of acting in 
     the broader national interest on fiscal matters. Whenever 
     Congress considers spending cuts that could help balance the 
     budget, only a few Americans are aware of it, and fewer still 
     express their views about it. By contrast, those who stand to 
     lost from budget restraint--typically the beneficiaries and 
     administrators of spending programs--are well aware of what 
     they stand to lose. They mount intensive lobbying campaigns 
     to stop fiscal restraint.
       This pro-spending and pro-debt bias has led to 27 straight 
     unbalanced budgets. It took our nation 205 years--from 1776 
     to 1981--to reach a $1 trillion debt. Now, just 16 years 
     later, the debt is $5.3 trillion. Each year, interest 
     payments rise as the overall debt grows. These payments have 
     been one of the fastest-rising items in the federal budget--
     they now account for more than the entire deficit, all by 
     themselves. A succession of statutory remedies has failed to 
     stem this historic and highly dangerous turn of events.
       S.J. Res. 1 is a sound amendment that has evolved through 
     years of work by the principal sponsors. It provides the 
     constitutional discipline needed to make balanced federal 
     budgets the norm, rather than the rare exception (once in the 
     past 36 years), and it offers the proper flexibility to deal 
     with national emergencies.
       In addition to requiring a three-fifths majority vote to 
     deficit spend or increase the federal debt limit, S.J. Res. 1 
     is designed to make raising federal taxes more difficult. It 
     would require the approval of a majority of the whole number 
     of members in both the House and Senate--by roll call votes--
     in order to pass any tax increase. This adds much-needed 
     accountability.
       Unless action is taken now, higher federal spending and 
     debt will continue to cripple our economy and mortgage our 
     children's future. We urge you to support S.J. Res. 1, the 
     Balanced Budget Amendment.
           Sincerely,
       National Taxpayers Union.
       American Bakers Association.
       American Legislative Exchange Council.
       American Subcontractors Association.
       Americans for Financial Security.
       Amway Corporation.
       Associated Equipment Distributors.
       Christian Coalition.
       Council for Citizens Against Government Waste.
       Family Research Council.
       Food Distributors International.
       Independent Bakers Association.
       International Mass Retail Association.
       National Association for the Self-Employed.
       National Association of Manufacturers.
       National Association of Wholesaler-Distributors.
       National Federation of Independent Business.
       National Restaurant Association.
       Printing Industries of America.
       Sixty Plus Association.
       Textile Rental Services Association.
       United Seniors Association.
       U.S. Business and Industrial Council.
       U.S. Federation of Small Business.
       Alliance for Affordable Health Care.
       American Farm Bureau Federation.
       American Small Business Association.
       Americans for a Balanced Budget.
       Americans for Tax Reform.
       Associated Builders and Contractors.
       The Business Roundtable.
       The Concord Coalition.
       Electronic Industries Association.
       Financial Executives Institute.
       FMC Corporation.
       International Dairy Foods Association.
       Motorcycle Industry Council.
       National Association of Home Builders.
       National Association of Realtors.
       National Cattlemen's Beef Association.
       National Ready Mixed Concrete Association.
       National Truck Equipment Association.
       Reform Party.
       Small Business Survival Committee.
       Traditional Values Coalition.
       United We Stand America.
       U.S. Chamber of Commerce.

  Mr. CRAIG. The question of whether Congress should pass a balanced 
budget amendment to the Constitution is one of the few truly momentous 
votes facing this country and the Congress today. The decision we face 
is in a class of votes like that of a declaration of war. The vote this 
afternoon will be a vote to end a war.
  For more than 28 years, the national debt and the special interest 
groups that feed off the taxpayers have waged a war against our economy 
and, most importantly, a brutal war against the integrity of the 
investment of the senior citizens and the opportunity of our children 
and our Nation's future. The spoils of that war is a $5.3 trillion 
debt. That debt fuels inflation and squeezes the senior community that 
lives on fixed incomes. That debt already depresses wages and living 
standards of the working families.
  More than one-half of all personal income taxes paid--let me repeat 
that, Mr. President--more than one-half of all personal income taxes 
that are paid today go to pay interest on debt alone.
  The costs of unbalanced budgets will be the most oppressive to our 
children. A child born today will pay nearly $200,000 in additional 
taxes, not to pay down the debt, but to pay interest on that debt.
  Under today's trends, when a child born today is fully grown and 
reaches his or her most productive years, not just the Government, but 
the entire economy could well be in bankruptcy.
  The nonpartisan Congressional Budget Office puts it this way: The 
Federal ``debt would exceed levels the economy could reasonably 
support.'' In other words, somehow, a generation from now, we could 
actually see that generation having to jettison a debt under a 
declaration of bankruptcy as a nation. That should not be allowed to 
happen, and this Congress and this Senate this afternoon have an 
opportunity to make the kind of change that is needed. We can offer to 
the American people an opportunity for them to debate this issue and, 
in every State's capital around

[[Page S1864]]

the Nation, reclaim their authority over their central Government, by 
placing into the Constitution the restriction and the positive 
guidelines that this and every Congress must balance its budget.
  Some who vote ``no'' today may claim that they want a balanced 
budget, or even a balanced budget amendment. They may use some other 
amendment as an excuse. But it should be said, and it should be said 
often, until the vote occurs this afternoon, a ``no'' vote today is a 
vote for the status quo, which means a growing Federal debt and a 
borrow-and-spend policy that has dominated this Government and this 
Congress for well over 30 years.
  No wonder our former colleague Paul Simon calls it ``fiscal child 
abuse'' to continue this binge of borrow-and-spend.
  This is a moral issue.
  The money being borrowed and spent today belongs to our children. 
They will pay the bill for years of profligate spending.
  Thomas Jefferson said it well:

       The question whether one generation has the right to bind 
     another by the deficit it imposes is a question of such 
     consequence as to place it among the fundamental principles 
     of government. We should consider ourselves unauthorized to 
     saddle posterity with our debts, and morally bound to pay 
     them ourselves.


                INTEREST IS DOMINATING OTHER PRIORITIES

  When a family takes out a mortgage on a house, or a business builds 
an addition to its shop, it borrows. But that family or business then 
spends the next few years balancing their budgets to pay off that debt.
  The Federal Government, unfortunately, does not operate like that.
  Every family and every farm or small business knows what happens when 
you borrow: You pay interest.
  Gross interest, at $360 billion, is already the second largest item 
of spending in the Federal budget, almost exactly equal to the largest 
program--Social Security.
  And what do we get for those interest payments? Nothing--except 
another year older and deeper in debt.
  Not one more school, not one more meal for a hungry child, and no 
relief for overtaxed, overworked, families of modest and middle-class 
means.
  Interest payments act like a giant sponge, soaking up money that we 
all want to go to other priorities.
  They have already forced cuts in many Federal programs. They will 
continue to crowd out other public priorities, including, eventually, 
Social Security and Medicare.
  In 1996, we sent $67.7 billion overseas in interest payments to 
foreign bondholders, because of the debt.
  How can any Senator stand on this floor, say we should use our wealth 
at home to solve our problems, and then vote against this balanced 
budget amendment?
  By default, it is the national debt--not Congress--that more and more 
decides how we spend the taxpayers dollars.


                  THE BBA IS THE ANSWER TO THE THREAT

  The debt is the threat--to our children, our parents, and the way of 
life we cherish in this country.
  The U.S. Senate has a chance today to begin putting an end to that 
threat--by passing the balanced budget amendment to the Constitution.
  Balancing the budget means real benefits to real people.
  If we balance the budget by the year 2002 and keep it balanced, that 
will create 2.5 million new jobs. It will save the typical family 
$1,500 a year in interest costs on mortgages, student loans, and car 
loans. It will raise wages and incomes for working Americans and their 
families.
  Yes, the President has promised a balanced budget. Yes, Congress has 
tried to pass a balanced budget.
  But we have had standing on the Senate floor during this debate an 8-
foot-tall stack of books.
  This is the leaning tower of budgets--the last 28 budgets submitted 
by President Clinton and his predecessors.
  In half of those budgets, the President who submitted them promised 
balanced budgets. Between them, those Presidents and past Congresses 
broke every promise.
  Yes, deficits have declined. Congress has made some progress in 
controlling the year-to-year growth of spending. But deficits are 
already projected to go back up and--in a few years--off the charts. 
Maybe the President and this Congress can bind a future President and a 
future Congress to finish balancing the budget in 2002. Maybe. But 
then, what about 2003? And 2004?

  Only one thing will impose a rule that Presidents can't ignore with 
impunity, that Congresses can't repeal or delay; only one thing will 
make Presidents and Congresses keep their promises; only one thing will 
make fiscal responsibility and tough choices the norm instead of the 
exception; the bridge to the 21st century may be paved with good 
intentions, but it will be a rickety, dangerous bridge unless it is 
constructed with the steel of the balanced budget amendment.


          WILL THE SENATE SAY ``YES'' OR ``NO'' TO THE PEOPLE?

  Unfortunately, this President--and a host of special interest groups 
comfortably feeding at the public trough--have put incredible pressure 
on the Senate to defeat this amendment. They want to say ``no'' to the 
people. But the people say, by a 70-to-30 percent margin in the latest 
poll, that they want us to pass the amendment; they want to say ``no'' 
to the people, who deserve the right to examine, debate, and decide on 
this amendment through their State legislatures.
  Congressional passage would only be the start. The people deserve the 
final word on what goes in their Constitution. After passing Congress, 
the amendment would go to all 50 State legislatures for ratification. 
And that would begin one of the greatest public debates, one of the 
greatest civics lessons, in the history of our Nation.


                 FINAL PASSAGE IS THE VOTE THAT COUNTS

  Some who vote ``no'' today may try to claim they want a balanced 
budget, or even a balanced budget amendment. They may use some other 
amendment as an excuse. But a ``no'' vote today is a vote for the 
status quo of borrow-and-spend. A ``no'' vote today is a vote in favor 
of the $3 trillion scheduled to be added to the debt over the next 10 
years. How will another $3 trillion in debt help seniors on Social 
Security? No matter what you think is the best way to save Social 
Security, passing this balanced budget amendment is the certain way to 
save it.
  Opponents have not made a case against this amendment--they have only 
shown they are afraid of balancing the budget. That's what it means 
when they say, ``If we can't run deficits, we may not be able to spend 
on this or that.'' Take so-called capital budgeting, for example: If we 
exempt narrowest category of investment spending in the President's 
budget, major physical capital, we could have run a larger deficit last 
year than we did. These pleas to exempt this or that item are not sound 
budgeting; they are a plea to continue the status quo.
  It defies common sense: Opponents believe Congress will only do the 
right thing if we are allowed infinite borrowing and unlimited 
spending.
  But we who support the amendment believe Congress will begin to do 
the right thing if it is required to live within its means and set 
priorities.
  Our balanced budget amendment is a bipartisan amendment, written with 
painstaking care over several years by Democrats and Republicans, 
liberals and conservatives. It is the bipartisan, bicameral, consensus 
amendment. If we do not pass it today, we will be back until we do.
  Why are we working so hard to pass it? Because we want economic 
security for our senior citizens. We want to preserve the American 
dream of growth and opportunity. We want a better world for our 
children.
  The balanced budget amendment deserves to pass the Congress, and go 
to the people for their final, wise judgment.
  Mr. President, I ask unanimous consent that I may have printed in the 
Record several fact sheets that my office, working with others, have 
prepared during this debate.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 CLUBB

           Congressional Leaders United for a Balanced Budget


    Top Ten Reasons to Support the Balanced Budget Amendment to the 
                  Constitution (H.J.Res. 1/S.J.Res. 1)

       No. 1 Kids: The future for our children depends on the 
     future of the economy. Their standard of living could be 7 to 
     36 percent better by the year 2020, if we balance the

[[Page S1865]]

     budget and keep it balanced.\1\ In contrast, under current 
     trends, in less than two generations, the size of the Federal 
     debt is ``not computable . . . [because the] debt would 
     exceed levels that the economy could reasonably support''.\2\ 
     In other words, the debt would bankrupt, not only the 
     government, but the entire economy.
---------------------------------------------------------------------------
     * Footnotes at end of article.
---------------------------------------------------------------------------
       No. 2 Seniors: The debt is the threat to Social Security--
     and to Medicare and other priorities. Gross interest payments 
     are already the second-largest single item of federal 
     spending ($344 billion in FY 1996), nipping at the heels of 
     Social Security, the largest ($347 billion).\3\ An ever-
     growing debt makes it less and less likely that the 
     government will have the cash it needs to meet future 
     obligations and priorities.
       No. 3 Interest Savings to Families. A typical family could 
     save $1,500 or more every year because balanced budgets would 
     reduce interest costs--$1,230 on a $50,000 mortgage, $216 on 
     a student loan, $180 on a typical auto loan.\4\
       No. 4 Jobs and Economic Growth: Balancing the federal 
     budget can create 2.5 million new jobs and boost 
     nonresidential investment by 4 to 5 percent.\5\
       No. 5 Lower Taxes: According to analysis cited by both the 
     Congressional Budget Office and the President's Office of 
     Management and Budget, failing to change current trends in 
     government debt could leave future generations with a 
     lifetime net tax rate of up to 84 percent, counting taxes at 
     all levels of government.\6\ A child born today faces nearly 
     $200,000 in additional taxes just to pay the interest on the 
     federal debt.\7\
       No. 6 The People: Public opinion surveys consistently show 
     70-80 percent of the American people support passing a 
     Balanced Budget Amendment to the Constitution.
       No. 7 Keeping Our Wealth at Home: Interest on the federal 
     debt is largely a transfer from middle-income taxpayers to 
     large institutions, wealthy individuals and foreign 
     investors. In FY 1996, the U.S. Government sent $67.7 billion 
     overseas in interest payments on Treasury securities held by 
     foreign investors. This transfer amounts to 27.4 percent of 
     all net interest--a steadily growing percentage; it was five 
     times the amount of total spending on all programs in the 
     ``International Affairs'' budget function \8\ and is the 
     largest ``foreign aid program'' in history.
       No. 8 More Resources for Congress to Do the Will of the 
     People: Moving toward a balanced budget during FY 1998-2002 
     should reduce federal debt service costs over that period by 
     $36 billion and improve economic performance enough to 
     produce a ``fiscal dividend'' of another $77 billion in 
     revenues and interest rate savings--all of which would become 
     newly-available for priorities within a balanced budget. 
     Committing to a balanced budget helps pay for itself.\9\
       No. 9 Reasonable Glide Path: Achieving balance requires 
     discipline, but not draconian measures. Under the BBA, 
     overall federal spending can continue to increase by more 
     than 2.6 percent a year through FY 2002 (compared with more 
     than 4.6 percent under current projections). To maintain 
     balance after 2002, spending could continue to grow at more 
     than 4.6 percent a year.\10\
       No. 10 Letting the Constitution Work and the People Decide: 
     A vote for the BBA in Congress is a vote to let the People 
     and their state legislatures exercise their constitutional 
     right to make the ultimate decision on this issue. Three-
     fourths (38) of the states would have to ratify any amendment 
     to add it to the Constitution. Sending the BBA to the states 
     would begin a great debate--from state capitols to coffee 
     shops--on the appropriate size and role of government.


                                 NOTES:

     \1\ General Accounting Office, Prompt Action Necessary to 
     Avert Long-Term Damage to the Economy, June 1992. (More 
     recent developments still would keep projections reasonably 
     within this range.)
     \2\ Congressional Budget Office, The Economic and Budget 
     Outlook: Fiscal Years 1997-2006, May 1996.
     \3\ Congressional Budget Office, The Economic and Budget 
     Outlook: Fiscal Years 1998-2007, January 1997.
     \4\ Committee on the Budget, U.S. House of Representatives, 
     based on a DRI-McGraw Hill study which assumed a 2% drop in 
     interest rates resulting from balancing the budget.
     \5\ DRI-McGraw Hill, January 1995. Projections covered the 
     years 1995-2002.
     \6\ Congressional Budget Office, May 1996 (up to 84%). Also, 
     Budget of the United States, Analytical Perspectives, FY 1995 
     (up to 82%).
     \7\ House Budget Committee.
     \8\ Budget of the United States, Analytical Perspectives, FY 
     1998.
     \9\ Congressional Budget Office, January 1997.
     \10\ Congressional Budget Office, January 1997.
                                                                    ____


      The Balanced Budget Amendment--Safeguarding Social Security


   The BBA Will Protect This and Other Programs Vital to our Seniors

       Passage of the Balanced Budget Amendment to the 
     Constitution (H.J. Res. 1/S.J. Res. 1) is critically needed 
     to ensure that the federal government will continue to have 
     the means to honor our obligations to our senior citizens. 
     The best guarantee of the economic security of our seniors, 
     today and in the future, would be the ironclad commitment of 
     the Constitution to restore and maintain fiscal 
     responsibility.
       Balancing the budget and keeping it balanced means less 
     debt, lower interest costs, rising living standards--and more 
     money made available for seniors' priorities. If today's debt 
     had been paid off in years past, the government would have 
     run a $134 billion surplus last year.
       Escalating interest payments crowd out ALL other 
     priorities.
       In 1976, 7.2 percent of the federal budget went to make 
     interest payments on the federal debt. In 1996, net interest 
     consumed 15.5 percent of the budget. As a result, other 
     programs have already felt the budget knife. Social Security 
     and Medicare are the first and third largest federal 
     programs; these two programs alone made up more than 33 
     percent of last year's spending. All seniors and retirement 
     programs make up about 40 percent of the budget, not counting 
     seniors' participation in non-seniors programs.
       We are all familiar with what happens to households and 
     businesses that run up too much debt--the burden of interest 
     payments on the debt becomes so great that they eventually 
     have to go without necessities or face total bankruptcy. 
     Unbalanced federal budgets mean growing interest payments 
     (which are mandatory, to prevent default) that will 
     increasingly crowd out all other public priorities--including 
     those vitally important to seniors.
       The debt is the threat to Social Security. Decades of 
     borrow-and-spend government have produced a $5.3 trillion 
     gross federal debt. About $600 billion of that is owed to the 
     Social Security trust funds. (The law creating Social 
     Security requires that any accumulated surpluses be invested 
     in U.S. Treasury securities (i.e., loaned to the ``general 
     fund'').) Under current trends, the total debt will double 
     over the next dozen years and seniors will wonder--rightly--
     about the Treasury's ability to repay those debts. In the 
     long run, a bankrupt federal government will not be able to 
     send out ANY checks--to Social Security beneficiaries or any 
     other debtor.
       Balanced Budget Prosperity is a Senior's Best Friend.
       Past promises regarding Social Security have been fulfilled 
     because of a growing economy, enabling workers to pay into 
     the system. Higher wages mean greater retirement benefits. 
     Unfortunately, seniors are already paying for today's debt 
     burden. A Federal Reserve Bank of New York study found that 
     the federal debt accumulated in the 1980s already pinched our 
     standard of living by 5 percent. The Concord Coalition 
     estimates that the debt has taken $15,000 off the typical 
     family's income. Continued deficit spending weakens the 
     economy, deteriorates living standards for younger workers 
     and seniors, and fuels resistance to the taxes that fund the 
     growing requirements of Social Security and other seniors' 
     programs.
       The BBA would ensure TIMELY action to protect Social 
     Security in the future.
       The Social Security Trustees predict that benefits will 
     exceed Social Security tax revenues by the year 2012--based 
     on optimistic assumptions. Passing the BBA now promises to 
     stem the tide of red ink spent on all other programs, in time 
     to prevent a double-whammy when Social Security's financing 
     needs escalate in a few years because of the retirement of 
     baby boomers.


                               Quotable:

       ``[T]he most serious threat to Social Security is the 
     federal government's fiscal irresponsibility. If we continue 
     to run federal deficits year after year, and if interest 
     payments continue to rise at an alarming rate, . . . [e]ither 
     we will raid the trust funds to pay for our current 
     profligacy, or we will print money, dishonestly inflating our 
     way out of indebtedness. Both cases would devastate the real 
     value of the Social Security trust funds.
       ``Regaining control of our fiscal affairs is the most 
     important step that we can take to protect the soundness of 
     the Social Security trust funds. I urge the Congress to make 
     that goal a reality--and to pass the Balanced Budget 
     Amendment without delay.''--Robert J. Myers, former Chief 
     Actuary and Deputy Commissioner for the Social Security 
     Administration, former Executive Director of the National 
     Commission on Social Security Reform

       ``Dorcas Hardy, the former commissioner of Social Security, 
     emphasized this point in her book, Social Insecurity. Her 
     number one recommendation for protecting the Social Security 
     Trust Fund: Balance the federal budget.
       ``The fact that I have spent my legislative career fighting 
     for seniors, for health care, and for other needed social 
     programs would, I hope, at least cause some to pause in their 
     passionate rhetoric to listen, and examine. . . . Only with 
     this Amendment can we be confident that all of us will have a 
     secure economic future.''--Former U.S. Senator Paul Simon (D-
     Illinois).
                                                                    ____


 A Capital Spending Exemption--Not a Capital Idea for the Constitution

       A special exemption for ``capital'' or ``investment'' 
     spending does not belong in the Balanced Budget Amendment to 
     the Constitution. A constitution deals with the most 
     fundamental responsibilities of the government and the 
     broadest, timeless principles of governance. It should not 
     set budget priorities or contain narrow policy decisions such 
     as defining a capital budget.
       Whatever the merits are of making such spending a higher or 
     lower priority than it has been, this question is best 
     addressed in the annual budget process.
       The debt is the threat to capital investment. Escalating 
     interest payments on the huge federal debt are crowding out 
     all other priorities. According to the National Entitlement 
     Commission's 1995 report: ``By 2012, unless appropriate 
     policy changes are made in

[[Page S1866]]

     the interim, projected outlays for entitlements and interest 
     on the national debt will consume all tax revenues collected 
     by the federal government.'' That means no money left for 
     capital investment--or defense, education, the environment, 
     law enforcement, science, or other domestic discretionary 
     programs.
       If states, businesses, and families can borrow, why 
     shouldn't the federal government? Everyone else repays the 
     principal they have borrowed. Families take out a mortgage 
     and then spend years paying it down. The same is true of 
     capital investments by businesses and state and local 
     governments. But the federal government just keeps borrowing 
     more. And more.
       Unlike state budgets or family finances, the federal budget 
     is large enough to accommodate virtually all capital 
     expenditures on a regular, ongoing basis. The justification 
     that most businesses and state and local governments have for 
     capital budgeting is that they occasionally need to make one-
     time, extraordinary expenditures that are amortized over a 
     long period of time.
       The federal budget is so huge--now more than $1.6 
     trillion--that almost no conceivable, one-shot project would 
     make even a small dent in it.
       Even the federal Interstate Highway System, which has been 
     called the largest peacetime undertaking in all of human 
     history, was financed on a pay-as-you-go basis. President 
     Eisenhower initially proposed that the Interstate System be 
     financed through borrowing by selling special bonds. However, 
     Congress kept it on-budget and financed it through a gas tax 
     at the urging of then-Senator Albert Gore, Sr.
       There are protections against the abuse of capital budgets 
     in state budgeting that do not constrain federal borrowing. 
     State and local governments have a check on their use of 
     capital budgets through bond ratings. If a state government 
     were to abuse its capital budget, then its bond rating would 
     drop and it would become difficult or impossible to continue 
     borrowing to finance additional expenditures. In addition, 
     many states require that bond issues be approved by the 
     voters.
       While state capital spending is often placed off-budget, so 
     are state trust fund surpluses. According to a Price-
     Waterhouse study, in recent years, state budgets would have 
     been roughly in balance if both capital expenditures and 
     trust funds (such as retirement funds) were included on-
     budget.
       The process of defining ``capital spending'' could be 
     abused. Even a category of ``capital'' or ``investment'' 
     spending that appeared to be tightly defined at first could 
     become a tempting loophole to future Congresses and 
     Presidents. For example, New York City, prior to its 
     financial crisis in the 1970s, amortized spending for school 
     textbooks by declaring their ``useful life'' to be 30 years.
       Virtually any form of ``capital spending'' exemption would 
     perpetuate the crisis of deficit spending. Even an exemption 
     from the Balanced Budget Amendment for a narrow category in 
     the President's budget, major public physical capital 
     investment, would have allowed a deficit larger than the one 
     that actually occurred in FY 1996 ($116 billion vs. $107 
     billion). It would result in an FY 1997 deficit that would 
     be, at most, 9 percent lower than current CBO projections 
     ($113 billion vs. $124 billion). Allowing deficit spending 
     for total federal investment outlays would have allowed 
     deficits larger than those that actually occurred in 28 of 
     the last 35 years. These estimates, of course, assume no 
     manipulation of definitions or accounting that would allow 
     still larger deficits.
       The concept of a ``capital budget'' is too poorly defined 
     to put in the Constitution. Estimates of ``capital spending'' 
     could vary widely. There is wide disagreement among 
     policymakers about what should be included in a federal 
     capital budget. There is no commonly accepted federal budget 
     concept of this term. Therefore, any capital spending 
     exemption included in the Constitution would be left open to 
     a wide range of interpretations. In fact, the President's 
     budget includes several different categories of ``capital'' 
     and ``investment'' spending. For fiscal years 1996 and 1997, 
     these include:

                        [In billions of dollars]                        
------------------------------------------------------------------------
                                                           Fiscal year--
                                                         ---------------
                                                           1996    1997 
------------------------------------------------------------------------
Major physical capital investment.......................   115.9   113.0
Net miscellaneous physical investment...................     3.1     3.1
Research and development................................    68.4    70.3
Education and training..................................    43.6    42.5
                                                         ---------------
    Total federal investment outlays....................   230.9   228.9
------------------------------------------------------------------------

       The Balanced Budget Amendment already allows for the 
     establishment of a capital budget--within the context of 
     regularly balanced budgets. The amendment does not prevent 
     the creation of separate operating and capital accounts. But 
     extraordinary expenditures which are large enough and unusual 
     enough to require significant new borrowing should be subject 
     to a higher threshold of approval, such as a three-fifth 
     majority vote. This is consistent with the recommendations of 
     General Accounting Office, which stated in its 1992 report, 
     Prompt Action Necessary to Avert Long-Term Damage to the 
     Economy:
       . . . [t]he creation of explicit categories for government 
     capital and investment expenditures should not be viewed as a 
     license to run deficits to finance those categories . . . . 
     The choice between spending for investment and spending for 
     consumption should be seen as setting priorities within an 
     overall fiscal constraint, not as a reason for relaxing that 
     constraint and permitting a larger deficit.''

  Mr. CRAIG. Mr. President, again, I thank my colleague from Utah for 
the tremendous leadership he has displayed.
  I yield the floor.
  (Mr. Kyl assumed the chair.)
  Mr. LEAHY. Mr. President, I yield 10 minutes to the distinguished 
senior Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, there is a right way and a wrong way to 
balance the budget. And a constitutional amendment is the wrong way.
  The choice is not whether to balance the Federal budget, but how to 
do it. I believe we will adopt a budget this year that is balanced by 
the year 2002. President Clinton has already submitted a budget to 
accomplish this goal. Democrats and Republicans alike in Congress are 
prepared to work together to enact a balanced budget.
  We can balance the budget by statute, while setting appropriate 
spending priorities for the future. We can protect Social Security for 
senior citizens. We can give priority to education and assure that 
funds for schools will not be cut in the middle of the year. We can 
deal with vital issues of national defense. We can deal with the need 
for capital investments in highways, public transportation, and the 
environment.
  Balancing the budget the right way is of special concern to the 
people of Massachusetts. A new study by the Twentieth Century Fund 
concludes that enactment of the balanced budget constitutional 
amendment would have dire consequences for the State of Massachusetts 
and its residents. The study finds that Massachusetts health and human 
services programs and educational programs receive more than three-
quarters of their funds from the Federal Government. Three hundred 
thousand Massachusetts residents are employed in my State's health care 
sector alone.
  This includes the work and the investment that the United States has 
in terms of the National Institutes of Health, since the nature of 
quality research really is unsurpassed in our part of the country. That 
whole effort would be threatened, as would many other areas of research 
and technology which help to move our whole economy, our national 
security defense, and the quality of health care forward.
  That is 10.5 percent of our work force. Balancing the budget the 
wrong way by failing to give priority to these key programs would place 
at risk hundreds of thousands of Massachusetts residents and tens of 
thousands of jobs.
  Republicans had the opportunity to address all of these concerns 
during the Senate's debate on the balanced budget constitutional 
amendment. But they refused to do so.
  When the Judiciary Committee considered the proposed constitutional 
amendment in January, I offered an amendment to protect Social 
Security. My amendment separated Social Security from the rest of the 
Federal budget, just as Congress has done by law for most of the past 
15 years. Senator Reid offered the same amendment here on the Senate 
floor last week. But the Republican majority opposed this important 
protection for the Nation's senior citizens.
  Senator Torricelli offered an amendment to permit a capital budget, 
just as most States and most families do, as a way of investing for the 
long run. Yet Republicans opposed this provision that is so important 
to the future of the economy.
  If families were subjected to this rigid constitutional amendment, 
they could never make long-term purchases. They couldn't buy a home 
through a mortgage, borrow money to send their children to college, or 
buy a new car on credit.
  This amendment flunks the kitchen table test. Families don't balance 
their budgets this way. Why should Uncle Sam?
  Senator Durbin offered an amendment to allow greater spending 
flexibility during recessions to protect jobs and assist laid off 
workers. More than 1,000 of the Nation's leading economists, including 
11 Nobel Prize winners, warned that the constitutional amendment 
proposed by the Republicans would put a straightjacket on the economy 
that would make recessions worse. But Republicans ignored

[[Page S1867]]

the economic evidence and opposed our pro-family, pro-worker amendment.
  The proposed constitutional amendment would also empower unelected 
judges to stop payments on Social Security checks or Medicare, or cut 
the defense budget. It would have allowed the President to impound 
funds appropriated by Congress, even though impoundment was outlawed in 
1974. But Republicans opposed our amendment to eliminate this problem.
  All our efforts to change the proposed constitutional amendment--to 
protect senior citizens, protect the national defense, protect workers 
in recessions--were summarily rejected by supporters of the 
constitutional amendment.
  In my view, the most serious defect in the proposed constitutional 
amendment is its threat to Social Security.
  Social Security is a contract with the Nation's senior citizens to 
guarantee at least a minimum level of security in their retirement 
years.
  In recognition of its special status, the Greenspan Commission 
recommended in 1983 that Congress should place Social Security outside 
the Federal budget. The Commission said we need to build up a 
sufficient surplus in the trust funds now, in order to have enough 
funds to provide benefits to the current generation when they begin to 
retire.
  Both Democrats and Republicans supported that result. In 1983, the 
Commission's recommendations were enacted in a law sponsored by Senator 
Dole and Senator Moynihan. Their bill required Social Security to be 
placed off-budget within 10 years. A bipartisan 58 to 14 vote, 
including 32 Republicans and 26 Democrats approved this important 
legislation.
  In 1985, Congress accelerated the process of placing Social Security 
outside the rest of the Federal budget. The Deficit Control Act of 
1985--the so-called Gramm-Rudman-Hollings law--exempted Social Security 
from across-the-board cuts or sequestration.
  That said, if they were not going to meet the budget titles, we were 
going to eliminate the cuts in Social Security from being sequestered 
like other programs would be. The reason for that is, unlike other 
kinds of spending programs, people have paid in over their working 
lives into this fund and should be entitled to receive it at the time 
of their retirement. That is different from all of the other kinds of 
programs. It was recognized by the Greenspan commission for that very 
reason--the contract with the American people, the contract with our 
senior citizens--that they had paid in, and we should not undermine 
their sacred trust into which they paid in; unique in terms of all of 
the Federal budget; recognized in a bipartisan way by the Greenspan 
Commission; recognized in the Gramm-Rudman proposal to be excluded and 
not be subject to sequestration; recognized again in 1990 during the 
budget debate.
  When there was any question about it, a vote of 98 to 2 said they 
will put Social Security outside of the consideration. There was a 
bipartisan commitment to do so. And, nonetheless, at the time we had 
the markup in the Judiciary Committee--and here on the Senate floor--
those individuals that talk about Social Security state that Social 
Security recipients will have to fight it out with the rest of the 
inclusions in the budget.
  That is not what this Congress said and the American people wanted--
over 15 years, and a bipartisan effort. But that is what has been 
excluded. And the answer that our friends give to that question is, 
``Oh, well, Social Security recipients will be further threatened if we 
have a demise or a threat to our economy.''
  Mr. President, we can deal with the economy of the United States, 
which is the strongest in the world. We should not be using the Social 
Security trust fund as a piggy bank either for tax cuts, as was 
threatened in the course of last year, or other kinds of cuts. We had 
the opportunity to support the Reid amendment, and that was rejected 
and turned down.
  The Gramm-Rudman-Hollings law also said that Social Security could no 
longer be included in the unified budget of the U.S. Government.
  From that point on, when Congress has adopted the annual Federal 
budget resolutions, Social Security is not included. The last time the 
Congress of the United States voted on a budget that included Social 
Security was 1985.
  Congress supported this change by wide bipartisan majorities. The 
Gramm-Rudman-Hollings law was approved by a 61 to 31 vote in the Senate 
and a 271 to 154 vote in the House of Representatives.
  In 1990, some Members of Congress proposed to put Social Security 
back into the Federal budget. But Senator Hollings and Senator Heinz 
rejected this unwise suggestion. They insisted that Social Security 
remain off budget, and the Senate approved an amendment to protect 
Social Security by a 98 to 2 vote.
  Again in 1995, section 22 of the congressional budget resolution 
amended the Budget Act to strengthen even further the firewall 
protecting the Social Security Program.
  The proposed balanced budget constitutional amendment would change 
all that. It would reverse 15 years of steady progress in protecting 
Social Security. It would turn its back on all this recent history, and 
expose Social Security to unwise and unacceptable cuts in the years 
ahead
  Employees may have worked hard all their lives. Social Security has 
been withheld from their paychecks month after month. They are 
expecting the money to be available when they retire. But this 
constitutional amendment places the entire program at risk.
  This constitutional amendment is a back-door raid on Social Security, 
and all of us who have worked hard to protect Social Security in recent 
years should reject it.
  Another serious defect in the proposed constitutional amendment is 
its enforcement.
  Thirteen of our Nation's most distinguished constitutional scholars 
wrote to me only yesterday expressing their deep concern about the 
proposed balanced budget constitutional amendment. The scholars include 
Harvard professor, Archibald Cox; former Attorney General, Nicholas 
Katzenbach; Yale professor, Burke Marshall; Stanford professor, 
Kathleen Sullivan; Harvard professor, Larry Tribe; and others. They 
stated:

       Whatever our differences about budget policy, we share the 
     conviction that enacting the proposed balanced budget 
     amendment would be a serious mistake. We believe that the 
     amendment would depart unwisely and unnecessarily from our 
     constitutional scheme.

  These eminent constitutional experts further concluded that it 
``would transfer power over government spending from the Congress, 
where the Framers deliberately reposed it, to the President and the 
courts.''
  What happens when we find in the middle of the year that revenues are 
lower or expenses are higher than we thought and the budget for that 
year will be unbalanced?
  This constitutional amendment allows unelected judges to step in and 
draw up a Federal budget of their own.
  That was an issue that was debated in the last two Congresses. It was 
the decision and the determination in the last two Congresses when we 
debated this to limit the authority of the judges under the old 
Danforth amendment to permit courts only to make declaratory judgments. 
Do you think that has been included in this balanced budget amendment? 
Absolutely not.
  We saw in the last Congress the amendment that was prepared by 
Senator Nunn and others which was virtually unanimously accepted to 
also exclude and limit further the power of the courts. Was that 
included? No. And all we can conclude is what was testified during the 
course of the Judiciary Committee hearings, and that is that the 
opportunity for the courts to interject themselves in making these 
budgetary decisions will be available to them unless we pass other 
kinds of laws, and the other laws that we might pass may very well be 
unconstitutional. Why leave that up in the air? These were attempts to 
address that issue, and they were rejected.
  Judges are appointed to interpret the Constitution and the laws. They 
are respected legal experts. But they do not know what priority to give 
to Social Security or education, or defense, or the public health. They 
don't know whether it is better in a particular year to reduce highway 
funding or medical research. Congress is elected to set those 
priorities and make those changes, and we should not surrender

[[Page S1868]]

that power to the judicial branch of government.
  Proponents of the amendment say that they oppose judicial activism. 
Yet this proposed constitutional amendment would be an invitation to 
judicial activism of the worst sort.
  President Clinton wrote to Senator Daschle on January 28, reaffirming 
his commitment to balance the Federal budget by the year 2002. The 
President also emphasized his view that a constitutional amendment was 
unacceptable. he stated,

       We should not lock into the Constitution a form of 
     budgeting that simply may not be appropriate at another time. 
     . . . We must give future generations the freedom to 
     formulate the federal budget in ways they deem most 
     appropriate.

  I urge the Senate to defeat this proposal. We are very close to 
balancing the budget the right way. It makes no sense to do it the 
wrong way, by locking the country into a constitutional straightjacket.
  I ask unanimous consent that a letter addressed to me dated March 3, 
1997 be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                                    March 3, 1997.
       Dear Senator Kennedy: The undersigned join in urging 
     Congress to reject the proposed Balanced Budget Amendment. 
     Whatever our disagreements about budget policy, we share the 
     conviction that enacting the proposed Balanced Budget 
     Amendment would be a serious mistake. We believe that the 
     Amendment would depart unwisely and unnecessarily from our 
     constitutional scheme in the following ways:
       It would transfer power over government spending from the 
     Congress, where the Framers deliberately reposed it, to the 
     President and the courts. Under the Amendment as drafted, the 
     President could assert the power or the obligation to impound 
     funds that Congress had authorized and appropriated. And 
     under the Amendment as drafted, the courts could be drawn 
     into extensive litigation over fiscal forecasts and policy 
     for which they are surely ill-equipped.
       It would substitute minority rule for majority rule in 
     fiscal legislation, by way of the proposed three-fifths 
     voting requirements for deficit spending or increased 
     borrowing. As James Madison warned in The Federalist No. 58, 
     such supermajority requirements would allow a few to extract 
     ``unreasonable indulgences'' from the many.
       It would invite Congress to shift the burden of national 
     policy objectives ``off-budget'' either to the States or to 
     the private sector through unfunded mandates or regulatory 
     burdens.
       It would deprive Congress and the President of needed 
     flexibility to deal with economic circumstances that are 
     likely to change over time.
       It would enact controversial socioeconomic policy into our 
     fundamental charter, which has maintained its authority since 
     the Founding by standing outside and above politics. The only 
     amendment to enact such a controversial policy in the past 
     was a failure: the 18th Amendment imposed Prohibition and the 
     21st repealed it.
       It would use the Constitution needlessly to promote 
     objectives that are already fully capable of being achieved 
     through ordinary legislation. To the extent it proved 
     unenforceable, it would undermine respect for other 
     constitutional guarantees.
           Sincerely,
         Boris I. Bittker, Professor Emeritus, Yale Law School;
         Archibald Cox, Professor Emeritus, Harvard Law School;
         Lawrence M. Friedman, Professor, Stanford Law School;
         Gerald Gunther, Professor Emeritus, Stanford Law School;
         Louis Henkin, Professor Emeritus, Columbia Law School;
         Nicholas Katzenbach, former Attorney General of the 
           United States;
         Burke Marshall, Professor Emeritus, Yale Law School;
         Norman Redlich, Dean Emeritus, New York University Law 
           School;
         Peter M. Shane, Dean, University of Pittsburgh School of 
           Law;
         Geoffrey R. Stone, Provost, University of Chicago;
         Kathleen M. Sullivan, Professor, Stanford Law School;
         Laurence H. Tribe, Professor, Harvard Law School;
         Harry Wellington, Dean, New York Law School.
       (Institutional affiliations are listed for identification 
     purposes only.)

  Mrs. MURRAY. Mr. President, I rise today to the pending 
constitutional amendment. The authors of the amendment have called it 
the balanced budget amendment. However, our vote today is not about 
balancing the budget, but rather about jeopardizing the future economic 
stability of the United States and eliminating the carefully crafted 
constitutional balance of powers. The amendment simply requires the 
President to submit a balanced budget; it does not mandate that 
Congress enact a balanced budget and it establishes no guidelines on 
enacting a balanced budget. This is not only the most dangerous budget 
gimmick put before this body, but it sets a dangerous precedent for 
addressing important issues facing us today and in the future.
  What the supporters of this amendment fail to point out is that we do 
not need to amend the U.S. Constitution to balance the budget. The 
President recently submitted to Congress a budget plan that does 
balance by the year 2002 and still protects our most vulnerable 
citizens; children, the disabled, and senior citizens. The President's 
proposal also continues our investment in education, environmental 
protection, biomedical research, and criminal justice. Instead of 
working on this proposal and enacting a budget for fiscal year 1998, we 
have spent almost a month debating an empty promise. Congress has a 
statutory requirement to pass a budget resolution by April 15, yet 
neither body has begun this process. We have spent valuable time 
debating an amendment that will not get us any closer to a balanced 
budget. I support a balanced budget; I have supported a balanced 
budget. What I cannot support is the misuse of the Constitution. The 
Constitution should only be used to expand rights and protections for 
citizens excluded from the original document. Our Constitution should 
not be used to limit the rights of our citizens or the obligations of 
the Federal Government.
  When I first came to Congress in 1993, the deficit was close to $300 
billion. I made a decision to try and secure a position on the Senate 
Budget Committee because I realized the most important thing I could do 
for the families in Washington State was to reduce the deficit. I 
worked with my colleagues in 1993 and passed a successful deficit 
reduction package. The deficit reduction proposal enacted in 1993, 
without one Republican vote, has cut the deficit in half. For 4 
straight years in a row the deficit has declined. We reversed the 
trends of the 1980's and restored fiscal restraint to the Federal 
budget process. Enacting this landmark deficit reduction package, 
required tough and difficult choices. But, that is why my constituents 
sent me to the U.S. Senate. I am willing to make those difficult 
choices as long as they are fair and balanced. A constitutional 
amendment to balance the budget does not force us to make those tough 
choices. Keep in mind that this amendment does not go into effect until 
the States adopt it. The States will have 7 years to ratify. Seven 
years is a long time when you are trying to balance the budget. I 
supported a revision to the amendment that would have shortened from 7 
to 3 years that time allowed for the States to ratify. Unfortunately, 
this change was rejected. We should not wait even 3 years; we should 
start now.
  There is no one in this Chamber who will deny that our Constitution 
has served us well. It established the longest continuous democratic 
government in the world. This document and the Bill of Rights are the 
envy of the world. Within this document our Founding Fathers 
spelled out the role of each branch of government. The responsibilities 
of the legislative, judicial, and executive branches were all clearly 
spelled out and a system of checks and balances was added so as to 
ensure that no one branch unduly influenced the other. One of the most 
important responsibilities entrusted to the legislative branch was the 
power to tax and spend. Our Founding Fathers felt very strongly that 
elected representatives of the people must be responsible for deciding 
on spending and taxes. As a member of both the Senate Budget Committee 
and Appropriations Committee, I do not take this responsibility 
lightly. But, a vote in support of this amendment will forever alter 
the role of Congress and the courts in deciding on spending priorities 
for the Federal Government. For the first time in history, the courts 
could decide how we spend tax dollars and how we raise tax dollars. A 
group of nine unelected officials could establish budget policy that 
conflicts with the wishes of the people solely because they believe 
that receipts will not cover outlays. Every time the Federal Government 
wishes to spend for Social Security or for a natural disaster, the 
courts could simply

[[Page S1869]]

say that this obligation would push spending beyond receipts.

  One need only look at the current difference between the 
Congressional Budget Office and the Office of Management and Budget. 
OMB has estimated that the President's budget gets to balance by the 
year 2002. However, CBO disputes the estimates on revenues and economic 
growth used by OMB. Who decides? The courts? Who decides what will be 
cut or what taxes raised to bring the budget into balance if Congress 
and the White House fail to agree? Judicial oversight of the Federal 
budget process violates the clear role of Congress and puts greater 
powers into the hands of unelected, life-time appointed Justices on the 
Supreme Court.
  In an effort to clarify any questions about the role of the courts, 
Senator Kennedy offered an amendment that would prohibit judicial 
control of the budget process. This amendment was defeated and rejected 
by the supporters of the constitutional amendment who claimed it was 
not necessary. Yet many legal and constitutional scholars have made it 
clear that the way the current amendment is written will allow for 
court challenges to Federal budget policy and decisions.
  In 1983, Congress enacted several measures aimed at protecting the 
long term financial stability of the Social Security trust fund. The 
intent of these measures was to build a large surplus and reserve in 
the trust fund that could be drawn down when the baby boomers started 
to retire. The 1983 legislation included tax increases, benefit 
reductions, and other structural reforms, all with the goal of 
protecting the system. Those who supported the 1983 legislation did so 
to protect the greater good, namely Social Security benefits for 
millions of current and future retirees. As a result, it is estimated 
that Social Security will not need to draw on these reserves until the 
year 2019. But, at that point, total spending will outpace receipts 
into the system. Under the current language in the amendment, we could 
not pay benefits using the surplus that we have intentionally allowed 
to accumulate. Regardless of any effort to maintain a surplus over the 
years, benefits would be in jeopardy, unless we raise payroll taxes or 
drastically cut spending in other areas, like Medicare, Medicaid, or 
education.
  This is not just my opinion. Recently a report from the nonpartisan 
American Law Division of the Congressional Research Service determined 
that we would be prohibited from drawing down the surplus in the trust 
fund in order to pay benefits unless there was a surplus in the 
remaining portion of the budget. Maintaining a large enough surplus in 
the remaining portion of the Federal budget would require significant 
reductions in many other important programs like Medicare, defense, 
education, environmental protection, and law enforcement. Passage of 
this amendment violates the current contract with today's workers that 
if you pay into the system now, Social Security will be there when you 
retire. There were several attempts to correct this flaw and exclude 
Social Security from the balanced budget amendment, but all attempts 
failed as the supporters of the amendment claimed that we did not need 
to protect Social Security.
  I have heard that voting for this amendment is the courageous vote. 
Nothing could be further from the truth. The courageous vote is the 
vote in support of a plan that actually reduces the deficit and puts us 
on a real path to balancing the budget by the year 2002. Today's vote 
is about political rhetoric, not reality. I hope that the political 
rhetoric is over and that we can begin the real task of balancing the 
budget.
  Mr. DODD. Mr. President, I wanted to take this opportunity to make 
clear my feelings on one particular aspect of the debate over the 
balanced budget constitutional amendment.
  My opposition to Senate Joint Resolution 1 is strongly felt and 
clearly stated. I simply do not believe that it is appropriate to 
enshrine a restrictive fiscal policy in our Nation's most sacred text. 
The balanced budget amendment would seriously inhibit our ability to 
set prudent fiscal policy and respond to cyclical patterns in economic 
growth. Moreover, the amendment has serious implications for our 
foreign policy.
  I am also concerned about the balanced budget amendment's effect on 
Social Security. The Social Security Program is one of the longest 
running and most successful programs this country has ever undertaken. 
It has succeeded in virtually eliminating poverty among our Nation's 
senior citizens. I yield to no one in my commitment to preserving and 
protecting it.
  In 1983, when Social Security was faced with changing demographics 
that threatened its very existence, I supported the reforms that 
ensured that this vital program would survive to meet the needs of 
future generations. Today, I am very concerned that the program is 
threatened by the restrictive provisions of the balanced budget 
constitutional amendment. If Congress is allowed to count Social 
Security surpluses when determining if the budget is in balance, this 
critical safety net for our Nation's seniors could be placed in 
jeopardy.
  For these reasons, I support efforts to protect the Social Security 
trust funds. If a balanced budget amendment to the Constitution is to 
be enacted, certainly, it should not be one that endangers the 
retirement security of American families. This is why I supported the 
amendment offered by my colleague, Senator Reid, which modified the 
underlying resolution to state that the Social Security trust funds 
could not be used to achieve balance.
  But I am afraid I could not support the amendment offered by my 
colleague Senator Dorgan. This amendment would have also protected 
Social Security, but, unlike Senator Reid's amendment, it was a 
substitute amendment, a fully crafted, alternative balanced budget 
amendment to the Constitution.
  Mr. President, I have grave concerns about any attempt to amend the 
Constitution to require a balanced budget. These concerns cannot be 
satisfied simply by changing one or two components of the legislation, 
as sincere and as sensible as those changes might be. I find any 
balanced budget amendment highly problematic, and this is why I have 
voted against the alternative balanced budget amendment offered by my 
good friend from North Dakota.
  I am a stalwart defender of Social Security, and I am committed to 
seeing that it protects future generations as well as it has protected 
previous ones. But I remain opposed to any amendment that would taint 
the language of the Constitution and weaken our ability to make prudent 
policy.
  Ms. MIKULSKI. Mr. President, I rise today in opposition to the 
balanced budget amendment to the Constitution. Let me be very clear, I 
want a balanced budget, and I am committed to do everything I can to 
achieve this goal. However, I do not believe we must amend the 
Constitution in order to balance the budget.
  I will oppose this amendment because it is unnecessary; because I am 
convinced that it threatens the viability of Social Security, and 
because it makes no provisions for investing in our infrastructure.
  This amendment does nothing to balance the budget. We already have 
the tools to do that. Since President Clinton's first term in the White 
House and my second term in the Senate, the deficit has fallen 
dramatically from $290 billion in 1992 to $107 billion in 1996. This 
amount represents just 1.4 percent of our gross domestic product, the 
smallest percentage of any industrialized nation. Clearly, as the past 
few years have shown us, we can continue to reduce the deficit--until 
it is balanced--without amending the Constitution.
  Many supporters of the balanced budget amendment believe that if you 
can balance the family budget, you can balance the Federal budget. But 
if each family lived by a balanced budget amendment, then mortgages, 
car loans, and student loans would be prohibited. In effect, a balanced 
budget amendment would prohibit the Federal Government from making the 
kind of investments for our future that our families make every day.
  Investments in our infrastructure would be threatened because the 
balanced budget amendment makes no provisions for a capital budget.
  Even State governments that require a balanced budget have a separate 
budget for capital projects, such as

[[Page S1870]]

highways, schools, et cetera. The balanced budget amendment would 
restrict our ability to improve our infrastructure.
  To address this issue, Senator Feinstein and Senator Torricelli each 
offered an amendment to provide for a capital budget for infrastructure 
investments. I voted for both the Feinstein and Torricelli amendments. 
Unfortunately, both amendments were defeated.
  Recently, 11 Nobel prize-winning economists announced their 
opposition to the balanced budget amendment because they felt it would 
put the country in an economic straitjacket. They make a very 
compelling case. I have no doubt that the balanced budget amendment 
would tie the Federal Government in knots, restricting our ability to 
respond to emergencies and economic downturns. Even the Wall Street 
Journal referred to the balanced budget amendment as politically empty 
symbolism. I agree with them.
  Finally, I believe the balanced budget amendment threatens the Social 
Security system. Under the balanced budget amendment, there is no 
protection for Social Security benefits. If the Government finds that 
the budget is not balanced, the Social Security trust fund could be 
used to make up the difference. I voted for the Reid amendment which 
would have exempted the Social Security trust fund from the balanced 
budget amendment. I regret that this amendment was defeated.
  Mr. President, I will not allow the Social Security trust fund to be 
used to balance the budget. We have a contract with our senior citizens 
and I plan to honor that contract. A promise made must be a promise 
kept. Without protections for Social Security, I will have to vote 
against the balanced budget amendment.
  I fully support the goal of balancing the budget but a constitutional 
amendment is not the way to do it. We need to continue to reduce 
spending to reach a balanced budget in an orderly manner that 
recognizes national priorities such as Social Security and the 
importance of making investments in our future.
  Mr. President, I stand ready to continue working toward a balanced 
budget but tampering with the Constitution is not the way to do it.
  Mr. MOYNIHAN. Mr. President, this afternoon, the Senate will vote for 
the third time in 2 years on a balanced budget amendment to the 
Constitution. Two years ago, during our first debate on this amendment, 
I argued that

       [T]here is nothing inherent in American democracy that 
     suggests we amend our basic and abiding law to deal with the 
     fugitive tendencies of a given moment.

  My point was that a series of one-time events in the 1980s had given 
rise to our recent fiscal disorders, and that a constitutional 
amendment was an inappropriate and indeed unnecessary response.
  Enactment of the Omnibus Budget Reconciliation Act of 1993 had, after 
a decade of reckless deficit spending, returned us to a path of fiscal 
responsibility. At the time of its enactment, OBRA 93 was estimated to 
bring about $500 billion in deficit reduction over 5 years. Three and 
one-half years later, estimates are that the total deficit reduction 
under the 1993 legislation will be more like $924 billion. So we are on 
the right track.
  In fact, we are even closer to a balanced budget than one might 
imagine--and a balanced budget amendment to the Constitution has 
nothing to do with how to achieve it.
  A balanced budget is easily within reach, if only we have the courage 
to seize the opportunity soon. In January 1996 and again in January 
1997, I proposed a simple plan to balance the budget by the year 2002. 
In addition to recommendations that were generally in both the 
President's budget proposal and the budget proposals offered by the 
Republicans, my plan requires only two actions:
  First, correct by 1.1 percentage points the overindexation of 
Government programs and tax laws; and
  Second, postpone tax cuts.
  That is all that needs to be done. It is all that ought to be done. 
It is not the time for tax cuts. Nor it is the time for crippling cuts 
in domestic discretionary spending. A correction of 1.1 percentage 
points, as recommended in December by the Advisory Commission to Study 
the Consumer Price Index appointed by the Finance Committee, or the 
Boskin Commission as it has come to be known, would save $1 trillion in 
12 years --and it would put Social Security into actuarial balance 
until the year 2052.
  The economics profession is behind this proposal, as is the Chairman 
of the Board of Governors of the Federal Reserve System, Dr. Alan 
Greenspan, who testified before the Finance Committee on January 30 of 
this year. Dr. Greenspan's own estimate of the overstatement of the 
cost of living by the Consumer Price Index is 0.5 to 1.5 percentage 
points per year, which is quite close to the estimate of the Boskin 
Commission. Notably, referring to the familiar argument that the 
decision to correct cost of living adjustment factors should not be 
politicized, Dr. Greenspan had the definitive response: not to act, 
given the overwhelming evidence that the CPI is an upwardly biased 
measure of inflation, is the political fix.
  Let us be absolutely clear about the direction of this bias. BLS 
Commissioner Katharine Abraham acknowledged at a February 11 Finance 
Committee hearing that the CPI is ``an upper bound measure on change in 
the cost of living.''
  So there is broad agreement in the economics community. And 
encouragingly, it appears we are close to agreement in Congress and the 
Executive Branch. Last week, Majority Leader Lott suggested that the 
appointment of a panel of graybeards on the issue was in order. The 
President immediately said he would take the Leader's suggestion under 
advisement. Then on Friday, in a meeting with editors and reporters at 
the Washington Post, OMB Director Franklin Raines expressed support for 
Senator Lott's proposal. Director Raines noted that the ``CPI is a very 
accurate price index, while only being an okay cost of living index.'' 
And now in this morning's New York Times, there is an article by 
Richard W. Stevenson headlined ``Clinton Wants Deal With Congress on 
Cost-of-Living Adjustments.'' It begins:

       President Clinton gave his aides the go-ahead today to try 
     to forge a deal with Congress to reduce cost-of-living 
     adjustments for Social Security and other benefit programs, 
     White House officials said.

  This is an important step forward by the Administration. Getting an 
accurate measure of the cost of living is the right thing to do, and it 
is the only way to put our fiscal affairs in order.

  I should add that although this issue has reemerged only recently, 
the fact that the CPI overstates the cost of living is not a new 
understanding. I came to Washington with the Kennedy Administration 35 
years ago. Upon our arrival in 1961, we had waiting for us a report by 
a National Bureau of Economic Research committee on ``The Price Indexes 
of the Federal Government.'' The committee was headed by George J. 
Stigler, who went on to win a Nobel Prize in economics. The report 
noted that:

       If a poll were taken of professional economists and 
     statisticians, in all probability they would designate (and 
     by a wide majority) the failure of the price indexes to take 
     full account of quality changes as the most important defect 
     in these indexes. And by almost as large a majority, they 
     would believe that this failure introduces a systematic 
     upward bias in the price indexes--that quality changes have 
     on average been quality improvements.

  Mr. President, I hope we don't allow this moment to pass us by. It is 
the right thing to do, and we ought to do it soon. We could have a 
balanced budget plan in place and forget this foolishness about 
amending the Constitution.
  If you don't think it is foolish, ask any economist. Last month, as 
the Senate began this debate, more than 1,000 economists, including 11 
Nobel Prize winners, signed a statement imploring Congress to reject 
Senate Joint Resolution 1, the balanced budget amendment to the 
Constitution. The economists wrote:

  We condemn the proposed ``balanced budget'' amendment to the federal 
Constitution. It is unsound and unnecessary.
       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.

  May I say, to paraphrase Santayana, that we may be condemned to 
repeat

[[Page S1871]]

an awful period in our history if this amendment is adopted. The 
historical precedent is chilling: in 1930, 1,028 economists implored 
President Hoover to veto the Smoot-Hawley tariff legislation. He 
ignored their pleas, with disastrous consequences. A 60 percent drop in 
trade; worldwide depression; the rise of totalitarian regimes; and in 
the wake of such events, the Second World War.
  Now, with the list of signatories growing, the economics profession 
is again pleading with us to reject this constitutional amendment. If 
we defeat the amendment, we will preserve the sanctity of our 
Constitution and promote economic stability. If we adopt it and it is 
ratified by the states, we will return to the dark ages of economic 
policy, having disregarded 60 years of social learning.
  As I indicated earlier, a great part of the rationale for the 
balanced budget amendment has been the problem of deficits and the 
rising national debt. Yet our problems with deficits are quite recent, 
having been generated in the relatively brief period of the 1980's. 
These deficits marked a sharp departure from the fiscal problems of 
earlier administrations, which were directed primarily to the problem 
of a persistent full employment surplus, with its accompanying downward 
pressure on consumer demand.
  The full-employment budget concept was explained by then-OMB Director 
George P. Shultz in his fiscal year 1973 budget:

       . . . expenditures should not exceed the level at which the 
     budget would be balanced under conditions of full employment.

  Which is to say that in the absence of full employment, as was the 
case in fiscal year 1973, the Federal Government should deliberately 
contrive to incur a deficit equal to the difference between the 
revenues that would actually come in at levels of underemployment, and 
those that would come in at full employment. Far from being inevitable 
and unavoidable, there were points in the business cycle where a 
deficit had to be created. Otherwise surpluses would choke off 
recovery.
  The term ``full employment surplus'' had originated earlier. The 
January 1962 report of the Council of Economic Advisers explained that 
as the recovery from the recession of 1958 got underway, economic 
activity grew and so did the revenues of the Federal Government. But 
Congress would not spend the additional revenue. As a result, the 
recovery stalled. This untoward event was ascribed to ``fiscal drag.''
  Beginning in 1980, the Reagan White House and Office of Management 
and Budget set about creating a crisis by creating deficits intended to 
force Congress to cut certain programs. In a television address 16 days 
after his inauguration, President Reagan said:

       There were always those who told us that taxes couldn't be 
     cut until spending was reduced. Well, you know we can lecture 
     our children about extravagance until we run out of voice and 
     breath. Or we can cut their extravagance by simply reducing 
     their allowance.

  Haynes Johnson wrote of this in ``Sleepwalking Through History: 
America Through the Reagan Years'' (1991). I will simply quote a 
footnote on page 111:

       [Stockman's] former mentor Moynihan was the first to charge 
     that the Reagan Administration ``consciously and deliberately 
     brought about'' higher deficits to force congressional 
     domestic cuts. Moynihan was denounced and then proven 
     correct, except that the cuts to achieve balanced budgets 
     were never made and the deficits ballooned even higher.

  The point is that the huge deficits and debt of the 1980's were 
intentional and anomalous, and therefore the balanced budget amendment 
is an inappropriate response. A balanced budget amendment would undo 
all that we have learned about economic policy over the past six 
decades--a lesson that can be easily seen in the fluctuations of the 
business cycle over the last 125 years. We had enormous volatility in 
economic activity prior to 1945--volatility that would be unacceptable 
today. For example, in 1905, output increased by 9.2 percent, to be 
followed 2 years later by declines of 1.6 and 5.5 percent in 1907 and 
1908 respectively, and an increase of 11.7 percent in 1909. Output 
increased by 16.2 percent in 1916 and by 7.7 percent in 1918, to be 
followed by 3 consecutive years of negative growth. And then, of course 
there was the Great Depression. After increasing by 6.4 percent in 
1929, output fell by 8.9 percent in 1930, another 7.8 percent in 1931, 
and then a further decline of an incredible 13.3 percent in 1932. After 
World War II all this changed, following a brief adjustment period, as 
the country converted from a wartime to peacetime economy. Since then 
the largest reduction in output was 2.3 percent in 1982.
  In the 1970's, I asked Council of Economic Advisers Chairman Charles 
L. Schultze to analyze what would have happened if a balanced budget 
amendment had been in force in the middle of the 1975 recession. He 
reported back that the computers at the Council ``blew up.'' GDP--then 
called GNP--would have dropped another 12 percent in an economy in 
which output was already 5 percent below capacity. During the debate in 
the last Congress, this simulation was repeated by the Treasury 
Department and by our minority Finance Committee staff, with the same 
results. With a balanced budget amendment, a moderate recession in 
which the unemployment rate increases by 2-3 percent becomes a major 
contraction--may I say depression--in which unemployment soars over 10 
percent and output falls by 15 percent or more. In the entire post-
World War II era the unemployment rate exceeded 10 percent only for a 
brief 10 months during the 1981-82 recession.
  Just as importantly, a balanced budget amendment would undo the 
progress we have already made, which I referred to earlier. Two years 
ago, in arguing against House Joint Resolution 1, I noted:

       As a result of the deficit reduction policies [put in place 
     by the Omnibus Budget Reconciliation Act of 1993] we have had 
     three straight years of deficit reduction--the first such 
     string of declines since the administration of Harry S. 
     Truman. Here are the numbers: FY 1992 $290.4 billion; FY 1993 
     $255.1 billion; FY 1994 $203.2 billion; OMB 1995 est., $192.5 
     billion; and CBO 1995 est. $176 billion.

  As I have said, our progress has been even better than expected. 
Remarkably, the deficit for fiscal year 1995 was lower than projected: 
$163.8 billion compared to projections of $176-$192 billion. The fiscal 
1996 deficit is even lower--$107.3 billion, just 1.4 percent of GDP, 
resulting in 4 consecutive years of deficit reduction. And, for the 
first time since the 1960's, we have a primary surplus--that is, 
excluding interest payments, revenues exceed outlays.
  Adoption of a balanced budget amendment--which as I said last year 
would be tantamount to ``writing algebra into the Constitution''--can 
only jeopardize the progress we have made. We can and will complete the 
job of balancing the budget without this amendment. It would be 
disastrous for our economy, and I hope it will once again be defeated.
  Mr. BINGAMAN. Mr. President, I rise today to take a few minutes of 
the Senate's time to comment about the balanced budget amendment on 
which we will be voting today.
  I came to the Senate in January 1983, at a point in time when the 
Federal Government was making terribly unwise choices about spending 
and revenues. Our budget deficits were off the charts during these 
Reagan years, and I felt that the very foundation of sound fiscal 
policy was being undermined. These were the years when we needed to 
have more serious debate about bringing spending under control--and 
when we needed to at least consider a more serious response such as 
amending the Constitution to require balanced budgets.
  We have a very different situation today. During the last 4 years, 
the budget deficit has declined remarkably. Tough choices are being 
made about spending and revenue which are bringing the deficit down to 
levels thought unimaginable only a few years ago. And today we nearly 
have unanimous bipartisan support to bring the budget into balance by 
2002. The Nation's budget deficit, as a percentage of gross national 
product, is the smallest it has been in decades and the least of all 
the great industrial powers.
  The difference between today and 14 years ago is that we are clearly 
moving strongly in the right direction, not through amendments to our 
Nation's most important legal document, but by debating our national 
priorities and making our spending better reflect those priorities.
  I believe in balancing the budget, but sound fiscal management 
demands that such balance be achieved by responsible choices that 
reflect our values--

[[Page S1872]]

helping those in need, promoting long-term infrastructure investment, 
and promoting high-wage job growth in our Nation. Those who have 
doggedly pursued this amendment to the Constitution did not do so when 
the budget imbalances were growing by great leaps during the Reagan 
administration; a balanced budget was not their concern. But cutting 
taxes on those who are best off is one of their primary concerns--and 
it was in part the spending profligacy of the early Reagan years 
combined with the ill-considered and regressive Kemp-Roth tax cut that 
created the enormous deficits we are financing today. We are actually 
spending less today than the Treasury is taking in--but because of 
enormous interest payments which take up nearly 20 percent of our 
entire annual spending, our budget is still in the red.
  We must be careful about confusing serious budget balancing efforts 
with partisan exercises that could disrupt the fiscal foundation of the 
country.
  One of my major concerns about this amendment 2 years ago which 
remains today is that the House still has in place a rule requiring 
three-fifths supermajority vote to raise income tax rates and income 
tax rates alone. Under the House rule, other taxes--such as the gas 
tax, Social Security tax, or other excise taxes--can still be raised by 
a simple majority, taxes that impact far more many of the working 
families from New Mexico whom I represent. This House rule stands as an 
obstacle to efforts to use the income tax, our most progressive tax, to 
raise revenues for deficit reduction.
  The balanced budget amendment that has been proposed does not help us 
resolve many of the problems that challenge our future economic health. 
Passing this resolution does not help us solve the challenge to Social 
Security that looms in our future. It is clear that we must address the 
problem of solvency of the Social Security trust fund, but as written 
this amendment could cause a train wreck at the point when Social 
Security disbursements become greater than Social Security receipts. At 
least under one interpretation of the proposed amendment, countless 
seniors could experience disruption in receiving their checks.

  During a time of severe economic hardship and recession, the 
Government has traditionally helped by using fiscal policy to prime the 
economy and jolt it toward growth. Such a strategy would not be 
possible given the requirements outlined in the balanced budget 
amendment. In addition, national security demands, the need to increase 
spending to thwart aggressive moves by some future enemy, or to respond 
to some military crisis might also be improperly constrained by the 
balanced budget amendment as written. There is also no provision in the 
balanced budget amendment permitting Congress to develop a capital 
budget, a budget capable of distinguishing between spending to meet 
current operating expenses and spending over a series of years for 
major capital improvements, such as highways, buildings, or a Federal 
agency's computer systems. I voted for amendments that would have made 
improvements in the balanced budget amendment and which would have made 
this a more workable piece of legislation, but all of these improving 
amendments were defeated.
  The authors of this amendment are pursuing too rigid a course--and 
are bent more on a theology of balanced budgets without taxes than they 
are on the economic health of the Nation.
  Also left unaddressed in this proposed amendment is the enforcing 
mechanism. When the Congress fails to govern responsibly and does not 
produce a balanced budget as called for by the Constitution, does the 
Supreme Court, as the chief interpreter of the Nation's Constitution, 
decide what accounts will be advanced and what accounts cut in order to 
achieve balance? These matters are unresolved and threaten to create 
confusion and harm our Nation's fiscal solvency--rather than create the 
order and balance that the Nation needs and wants.
  I will oppose the balanced budget amendment today because I believe 
that we should leave the question of how to achieve sound fiscal policy 
to a vote of a majority here in Congress. We should not try, by rule or 
other provision, to determine how future Congresses choose to reduce 
the deficit or keep the budget in balance. We should not dictate 
whether they cut spending or raise taxes. We should not try to 
predetermine for future Congresses, as this amendment would, which 
group of taxpayers will pay the taxes and which group will suffer the 
spending cuts. Because of the way that the balanced budget amendment is 
constructed, our decisions would be locked in permanently if this 
amendment were to become part of the Constitution. This is not wise, 
and I cannot support such an effort.
  The framers of the Constitution chose to leave neutral the way in 
which sound fiscal policy is achieved. We are well advised to defer to 
their good judgment on that subject, to cease our efforts to solve this 
problem by changing the Constitution, and instead, to solve it as we 
should--by continuing to make tough choices that reflect the priorities 
of our Nation.
  Mr. CRAIG. Mr. President, during this year's debate on the balanced 
budget constitutional amendment the Senate Republican Policy Committee 
prepared more than 20 papers to assist Republican Senators with our 
deliberations. Some of these papers have particular importance for the 
constitutional and political debate which has been going on for decades 
and which is going to continue.
  I ask unanimous consent that several of these papers be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       [From the U.S. Republican Policy Committee, Feb. 25, 1997]

       Overlooked Effects of Excluding Social Security From BBCA

       For years, leading opponents of the bipartisan balanced 
     budget constitutional amendment (BBCA) have been hiding 
     behind the gimmick of excluding Social Security from the 
     calculation of a balanced budget. While it is difficult to 
     take their proposal (S.J. Res. 12) seriously, it is 
     imperative to realize its very serious effects.


                       what s.j. res. 12 would do

       The actual consequences of S.J. Res. 12 would be the direct 
     opposite of the positive economic effects provided by a real 
     balanced budget requirement.
       S.J. Res. 12, over 30 years, would start with decreasing 
     deficits--achieve a moment of surplus (requiring enormous new 
     taxes or spending cuts)--enter a phase of declining surpluses 
     (to perhaps one-year's balance)--and then revert to 
     skyrocketing deficits.
       It would create $2.3 trillion in ``gimmick deficits'' 
     between 1998 and 2018.
       It would result in tax hikes and/or spending cuts of $1.935 
     trillion from 2002 to 2018.
       That $1.935 trillion is more than eight times Clinton's 
     largest-ever 1993 tax hike of $240 billion and almost five 
     times the amount of CBO's estimated savings ($423 billion) of 
     what it will take to reach balance between today and 2002. 
     While surpluses are not bad per se, this enormous level over 
     such short duration would produce massive fiscal strain.
       It would result in less than two decades of nondeficit 
     spending, and just one year in which the federal budget might 
     actually balance.
       It would provide no possibility for tax cut or spending 
     increase unless a recession occurs.
       It would require absolute spending cuts in five of the 
     first six years after the amendment, and a return to huge 
     federal deficits in little more than two decades--$700 
     billion from 2019-2024 and $2.474 trillion from 2019-2028, 
     all perfectly off-budget and constitutionally legal.
       S.J. Res. 12 could be worse than doing nothing because of 
     the high probability of massive tax increases that would 
     destroy economic growth.


                     what s.j. res. 12 would not do

       S.J. Res. 12 would not provide any additional support for 
     Social Security.
       It would not protect the trust fund--it will begin running 
     deficits just seven years after its outlays begin exceeding 
     revenues in 2012--exactly the current estimation. The trust 
     fund would be bankrupt just 10 years after that (2029)--also 
     the current estimation.
       The trust fund balance sheet would not change by a single 
     dime and its solvency calendar would not be altered by a 
     single day.
       S.J. Res. 12 would not alter the fact that Social Security 
     is a pay-as-you-go system and always has been.
       It would not provide a long-term solution. By pretending 
     there exists some hidden balance, it would forestall a real 
     solution to Social Security's long-term imbalance.
       Simultaneously, S.J. Res. 12 would damage Social Security 
     because Social Security's existence depends on a growing 
     economy to meet its growing commitments--something S.J. Res. 
     12's likely tax hikes would seriously jeopardize.


            how implausible are s.j. res. 12's requirements?

       Every dime of the $1.935 trillion that would be 
     artificially added to the deficit between

[[Page S1873]]

     2002 and 2018 would have to be payed for with tax hikes and/
     or spending cuts.
       In the 2002-2007 period, spending literally would have to 
     be cut in five of the six years under S.J. Res. 12, even 
     under CBO's most recent baseline spending estimates for a 
     balanced budget. By contrast, Congress's failed 1995 effort 
     to balance the budget was vetoed by Clinton, and it merely 
     slowed the rate of spending's growth.
       Spending would decline in absolute terms--not just 
     reductions in the rate of growth.
       How rare are absolute spending cuts? Only nine times since 
     1933 have they occurred. Eight were due to severe economic 
     contraction or postwar economies: 1935, 1937, and 1938 during 
     the Depression, the first three years following World War II, 
     and the first two years after the Korean War.
                                                                    ____


   [From the U.S. Senate Republican Policy Committee, Jan. 29, 1997]

A Gimmick Even the President Won't Embrace--Clinton's Remarks Undercut 
                             BBCA Opponents

       ``We couldn't right now, neither the Republicans nor I and 
     the Congress, could produce a balanced budget tomorrow that 
     could pass with, if you said the Social Security funds cannot 
     be counted, if you will, as part of the budget.'' --President 
     Clinton at his January 28th press conference.
       President Clinton does not support a balanced budget 
     constitutional amendment (BBCA), but yesterday, on the 
     record, he refused to accept the flimsy, implausible cover 
     being used by some of its congressional opponents who are 
     going to vote against the amendment unless Social Security is 
     taken out of it.
       The sentence from the transcript of the President's press 
     conference that is quoted above is not the clearest example 
     of oral expression that we have ever seen, but, clearly what 
     the President was saying was: A balanced budget is not 
     possible if Social Security is taken off budget and not taken 
     into account in calculating the deficit.
       Simply, Social Security is currently running a surplus and 
     is expected to do so for the near term. Thus, if Social 
     Security is removed from the budget calculations, the deficit 
     will be falsely inflated by hundreds of billions of dollars. 
     For example, if Social Security were to be omitted, the 
     deficit would grow by an additional $465 billion during 
     fiscal years 1998 through 2002 and by another $602 billion 
     during fiscal years 2003-2007, for a total of $1.067 trillion 
     over the 10-year period. This is on top of the very real 
     deficits with which Congress has been struggling for years.
       Last year, the President and the Congress each made 
     proposals that would have cut the deficit by about $500 
     billion for fiscal years 1997 through 2002. $500 billion is a 
     lot of money, but it is less than one-half of the amount that 
     the opponents' proposal would falsely add to the deficit if 
     Social Security is taken out of the balanced budget 
     calculations.
       It's interesting when the President, no stranger to 
     gimmicks, is willing to expose the ruse of his friends. 
     Recall that this president offered a budget that used 
     ``triggers'' to precipitously cut off spending programs in 
     its final two years in order to be able to claim to teach 
     ``balance.'' And, he offered a budget which shifts the 
     fastest growing portion of Medicare--Home Health Care--from 
     Medicare to the general taxpayer in order to claim he is 
     ``saving'' Medicare.
       If the opponents of a Balanced Budget Constitutional 
     Amendment are fiscally responsible, they will show us the tax 
     increases and spending cuts that they propose to enact to 
     make up for the $1.067 trillion that would artificially be 
     added to the deficit under their proposal by taking Social 
     Security out of the calculation. After all, those hiding 
     behind Social Security's exclusion to cover their opposition 
     are proposing to add to the deficit twice the amount that 
     Congress and Clinton proposed to cut! If they do not really 
     support an additional $1.067 trillion in new taxes and 
     spending cuts--and we doubt that they do--what do they really 
     support? The answer is evident: More of the same tired, 
     liberal approach to governing--more taxes, more spending, 
     more debt.
                                                                    ____


   [From the U.S. Senate Republican Policy Committee, Feb. 24, 1997]

   BBCA, Super-Majorities, and The Federalist--Madison and Hamilton 
                       Supported Super-Majorities

       The writers of the Federalist said some hard words about 
     super-majorities which are trotted out whenever Congress 
     debates the Balanced Budget Constitutional Amendment (BBCA). 
     Unfortunately, those hard words are almost always misused.


                   the federalist on super-majorities

       James Madison said that super-majorities transfer power 
     from the majority to the minority and thereby ``reverse'' the 
     ``fundamental principle of free government.'' A minority can 
     then frustrate the purposes of the majority even when 
     ``justice or the general good might require new laws to be 
     passed or active measures to be pursued.'' The Federalist No. 
     58, at 397 (J.E. Cooke ed. 1961). Alexander Hamilton said 
     that super-majorities may look like a remedy but are ``in 
     reality a poison.'' They operate ``to embarrass the 
     administration, to destroy the energy of the government, and 
     to substitute the pleasure, caprice or artifices of an 
     insignificant, turbulent, or corrupt junto for the regular 
     deliberations and decisions of a respectable majority.'' The 
     Federalist No. 22, at 140.
       This is strong stuff from two of America's giants. However, 
     both Madison and Hamilton were strong supporters of super-
     majority requirements, and only by using The Federalist out 
     of context can they be made to appear otherwise.


 the constitution itself, which the federalist was written to promote, 
                       contains super-majorities

       The Federalist was written to explain and promote a 
     Constitution which, in its original version, contained super-
     majority requirements in seven places: Article I requires 
     votes of two-thirds to convict on impeachment (Sec. 3, cl. 
     6), to expel a Senator or Representative (Sec. 5, cl. 2), and 
     to override a presidential veto (Sec. 7, cls. 2 & 3). Article 
     II requires a two-thirds vote in the Senate to consent to 
     treaties (Sec. 2, cl. 2) and called for special majorities if 
     the election of the President should be referred to the House 
     of Representatives (Sec. 1, cl. 3). Article V requires two-
     thirds of Congress and three-fourths of the States to amend 
     the Constitution. Article VII required ratifications from 9 
     of the original 13 States before the Constitution could go 
     into effect.
       Madison (always) and Hamilton (sometimes) were in 
     attendance at the convention when these super-majority 
     requirements were adopted, and Madison himself was 
     responsible for some of them. They signed the Constitution. 
     They became its most able advocates. Snippets from Federalist 
     No. 58 and No. 22 cannot obviate the fact that Madison and 
     Hamilton strongly supported the Constitution with all of its 
     super-majority requirements.


the federalist, which itself supports super-majorities, must be read in 
                        context to be understood

       But how do we account for The Federalist's hard words on 
     super-majorities? Quite easily, actually. The words merely 
     need to be read in context:
       What Madison was opposing in No. 58 was the suggestion that 
     the House of Representatives should require a super-majority 
     for a quorum and more than a majority of a quorum for a 
     decision. Madison did not, of course, oppose all super-
     majority requirements for the House, but he did oppose 
     suggestions put forward by opponents of the Constitution that 
     additional super-majorities were desirable.
       What Hamilton was opposing in No. 22 was the gridlock 
     occasioned by the Articles of Confederation with its super-
     majority requirements and unit voting (each State had one 
     vote).
       Hamilton also said (in Federalist No. 75), ``All provisions 
     which require more than the majority of any body to its 
     resolutions have a direct tendency to embarrass the 
     operations of the government and an indirect one to subject 
     the sense of the majority to that of the minority.'' Id., at 
     507. This sounds hard enough, but it appears in a paper about 
     the making of treaties, and Hamilton strongly supported the 
     two-thirds vote of the Senate as ``one of the best digested 
     and most unexceptionable parts of the plan.'' Id., at 503. 
     What Hamilton was opposing in No. 75 was the suggestion that 
     two-thirds of all members should be required on a vote rather 
     than two-thirds of those members present.
       Keep in mind, too, that complaints about super-majorities 
     (especially for quorums) were a product of the times--a 
     horse-and-buggy era when interstate travel was long, 
     difficult, and dangerous, and many legislators shunned 
     regular travel to the seat of a weak central government.


     Madison and Hamilton Supported Super-Majorities Independently

       Finally, we know that both Madison and Hamilton thought 
     super-majorities were sometimes necessary because they 
     advocated them separately. In convention, Madison moved that 
     a vote of two-thirds be required to expel a Senator or 
     Representative. His motion carried 10 States to none. 2 
     Farrand, The Records of the Federal Convention of 1787 at 254 
     (1937 rev. ed.). It was also Madison who moved that if the 
     choice of a President should fall to Congress, a quorum must 
     consist of two-thirds. Id., at 526. Hamilton outlined his own 
     plan for a government, but did not present it to the 
     convention. He did, however, draw upon its principles in 
     debate. That plan contained at least five requirements for 
     super-majorities. 3 Farrand at 620, 623, 625, 627, 630.
       Far from being opponents of super-majorities, Madison and 
     Hamilton supported them. They supported them in the 
     Constitution, in The Federalist, and in the convention. They 
     supported them because some rights are ``too important to be 
     exercised by a bare majority of a quorum.'' 2 Farrand at 254 
     (Madison speaking on expulsion). Spending our children's 
     inheritance is one of these rights--a right too important to 
     be exercised by a bare majority.

     [Some of the quotations from The Federalist have been edited 
     slightly.]
                                                                    ____


   [From the U.S. Senate Republican Policy Committee, Feb. 20, 1997]

              The Constitution and BBCA's Super-Majorities

       Some opponents of the super-majority requirements in the 
     Balanced Budget Constitutional Amendment (BBCA) must suffer 
     from an irony deficiency. Only the irony-deprived could 
     complain about BBCA's super-majorities while trying to cobble 
     together a minority of Senators (just 34) to defeat the 
     proposed amendment.

[[Page S1874]]

                       super-majority in the bbca

       S.J. Res. 1 requires ``three-fifths of the whole number of 
     each House of Congress'' to ``unbalance'' the budget (section 
     1) and to increase the debt limit (section 2). It requires 
     ``a majority of the whole number of each House'' to increase 
     revenues (section 4) and to permit a waiver because of a 
     threat to national security (section 5).


                  Super-majorities in the Constitution

       Framers of the original Constitution and framers of its 
     amendments regularly called for super-majorities. Congress 
     has used super-majority votes hundreds and hundreds of times 
     for seven purposes in three general areas:
     Area One: To Change the Laws
       Super-majority votes are required sometimes to enact laws. 
     These laws become the ``supreme law of the land.'' See Art. 
     VI.
       A two-thirds vote is required to override a presidential 
     veto. Art. I, Sec. 7, cls, 2 & 3. Congress has overridden a 
     veto 105 times (averaging once every Congress).
       Treaties require a two-thirds vote of the Senate. Art. II, 
     Sec. 2, cl. 2. The Senate has voted on an estimated 2,000 
     treaties (averaging about ten every year).
       Constitutional amendments require a two-thirds vote in 
     Congress (and ratification by three-fourths of States). Art. 
     V. The Constitution has been amended 27 times; there were 17 
     votes on those successful amendments. There were another five 
     votes on proposed amendments that cleared the Congress but 
     were never ratified by the States.
       Certain persons who ``engaged in insurrection or 
     rebellion'' against the United States are prohibited from 
     holding public office, but that disability may be removed by 
     a two-thirds vote of Congress. Amend. XIV, Sec. 3. By our 
     count, Congress legislated under this provision 191 times 
     from 1868 through 1898 (averaging about six per year).
     Area Two: To Remove from Office
       There is a second category of constitutional provisions 
     requiring a super-majority, namely those that allow Congress 
     to remove a person from office.
       Conviction on impeachment requires a two-thirds vote of the 
     Senate. Art. I, Sec. 3, cl. 6. Seven persons (all district 
     court judges) have been convicted by the Senate after 
     impeachment. Seven others (including an associate justice of 
     the Supreme Court, a Secretary of War, and President Andrew 
     Johnson) were tried and acquitted.
       Expulsion from the Senate or House requires a two-thirds 
     vote of the body. Art. I, Sec. 5, cl. 2. Fifteen Senators and 
     four Representatives have been expelled from Congress (the 
     great majority for disloyalty to the Union).
       (A President may be removed by a two-thirds vote of 
     Congress for inability to discharge his duties. Amend. XXV, 
     Sec. 4. This particular provision has never been used, 
     however.)
     Area Three: To Elect to Office
       If election of the President should fall to the House or 
     election of the Vice President should fall to the Senate, the 
     12th Amendment has special super-majority rules with respect 
     to quorums and voting. (These requirements supersede Art. II, 
     Sec. 1, cl. 3 which also contained super-majority 
     requirements.)
       After adoption of the 12th Amendment in 1804, the House has 
     had to act once (in 1825, electing John Quincy Adams) and the 
     Senate has had to act once (in 1837, electing Richard M. 
     Johnson to serve with Martin Van Buren).
     An Additional, Unique Super-Majority
       The Constitution itself provided that it would not go into 
     effect unless ratified by nine of the original 13 States. 
     Art. VII.


        bbca is consistent with constitutional text and practice

       The Framers put super-majority votes within the four walls 
     of the Constitution, and throughout the years Congress has 
     regularly and unremarkably operated under those super-
     majority requirements. In fact, the Senate acts by super-
     majority vote about once every month. Super-majority votes 
     are reserved for matters of special importance; they are not 
     daily events, but they are not rarities either. They are 
     about as rare as a new moon.
       Like the constitutional policies described above, spending 
     our children's inheritance is a matter of special 
     significance that should require an occasional super-majority 
     vote.

     Note on Estimate of Treaties. Counts of Senate action on 
     treaties vary widely because of differing methods and 
     judgments. In the original version of this paper we used an 
     estimate of 2,500. That number was based on data in Lyn 
     Ragsdale, Vital Statistics on the Presidency: Washington to 
     Clinton, Tables 7-1 & 7-2 (1996) (showing 1,955 treaties, 
     protocols, and conventions issued from 1789 through 1984 [all 
     of which appeared to require Senate action] and 1,542 total 
     international agreements from 1985 through 1993). After our 
     first version of this paper was released, CRS provided us 
     with an estimate of 1,704 treaties approved by the Senate 
     through 1996.
                                                                    ____


                                         OVERALL EFFECTS OF S.J. RES. 12                                        
----------------------------------------------------------------------------------------------------------------
             Years                   On-budget          Off-budget        True budget          Fiscal effect    
----------------------------------------------------------------------------------------------------------------
1998-2001......................  Declining deficit  Running Surplus..  Declining          Large cuts or taxes to
                                                                        deficit--$361      offset ``double      
                                                                        billion.           surplus'' ($361      
                                                                                           billion from 98-01)  
                                                                                           Social Security      
                                                                                           Revenue surplus &    
                                                                                           interest income.     
2002-2012......................  Balanced: But      Dual surplus of    Surplus of SS TF-- Enormous $1,395       
                                  must run           Social Security    $1.395 trillion.   trillion ``double    
                                  surpluses to       TF: Both revenue                      surplus'' offset by  
                                  offset SS          and interest.                         tax hikes or spending
                                  revenue removal                                          cuts.                
                                  and interest                                                                  
                                  transfer to off-                                                              
                                  budget.                                                                       
2013-2018......................  Balanced: Must     Deficit: Balanced  Diminishing        Larger $539.4 billion 
                                  run surplus to     via transfer       surplus--$539.4    ``single surplus''   
                                  make interest      interest payment   billion.           transfer via tax     
                                  payment to SS TF.  from on-budget.                       hikes or spending    
                                                                                           cuts to offset Social
                                                                                           Security interest    
                                                                                           surplus.             
2019...........................  Balanced: Must     Social Security    Balance for 1      Transfer of Social    
                                  run surplus to     TF runs first      year?--$2.6        Security interest    
                                  make SS interest   deficit in         billion deficit    payment in slightly  
                                  payment.           excess of both     projected off-     less ($2.6 billion)  
                                                     interest and       budget.            than Social          
                                                     revenue receipts.                     Security's revenue   
                                                                                           shortfall.           
2020-2029......................  Balanced: SS       Mounting SS        Rising deficits--  Diminishing Social    
                                  interest payment   deficits.          $3.122 trillion    Security interest    
                                  diminishing.                          (2019-2029).       surplus transfer as  
                                                                                           trust fund begins    
                                                                                           being consumed until 
                                                                                           exhausted in 2029.   
                                                                                           Increasing Social    
                                                                                           Security operating   
                                                                                           deficit must be      
                                                                                           absorbed. How? \1\.  
2030-Beyond....................  Balanced: No SS    Social Security    $744 billion       Social Security trust 
                                  interest payment.  trust fund         deficit in 2030    fund bankrupted.     
                                                     bankrupt.          alone.             Enormous deficits,   
                                                                                           though economically  
                                                                                           adverse, all off-    
                                                                                           budget and therefore 
                                                                                           legal.               
----------------------------------------------------------------------------------------------------------------
\1\ The federal government would be faced with at least three possible budget alternatives: (1) The federal     
  government borrows for Social Security and that money is put on-budget. Remember: the Social Security         
  amendment only addresses the receipts and outlays of Social Security. Once trust fund receipts are no longer  
  sufficient to cover Social Security's obligations, the shortfall must come from somewhere. Such a scenario    
  would require commensurate deficit reduction on-budget to cover the transfer to the off-budget trust fund. (2)
  An off-budget entity borrows for Social Security. The result would be substantially higher borrowing costs for
  the off-budget entity than if the money were borrowed by the federal government. However since this borrowing 
  would be off-budget, the additional cost would not be constitutionally prohibited--this despite the fact that 
  it would exacerbate the already very adverse true budget effect. (3) The federal government borrows for Social
  Security and that money is put off-budget. But this obvious liability of the government could be completely   
  ignored for constitutional purposes. Again, it would accommodate substantial deficits in the true budget.     

  Mr. KERREY. Mr. President, I do not intend to support this 
constitutional amendment. During previous debates on this issue, I have 
said that I believe that an amendment dictating a balanced budget does 
not belong in our Constitution but that the path to balance belongs in 
our laws. I continue to believe that. And, I hope I am not being too 
optimistic when I say that I honestly believe we have an opportunity to 
set our budget on the path to balance this year through legislation and 
we have the chance to do so in a reasoned and bipartisan way.
  I believe it is important to balance the budget as a way to promote 
economic growth. And any effort to achieve a balanced budget must be 
done fairly and equitably. But I'm not convinced that the 
constitutional amendment before us will ensure a budget balanced fairly 
or a budget that will ensure economic growth.
  In particular, I do not think it is wise to require a three-fifths 
vote to waive this amendment in times of economic emergency. This gives 
entirely too much power to larger population States in the House and 
would hurt smaller States like my home State of Nebraska. In addition, 
the national security waiver provision in this amendment is too 
restrictive. And, I do not think it is a good idea to allow Congress to 
rely on estimates to determine whether or not the budget is in balance. 
As previous experience has shown us, when you lead with estimates, 
gimmicks are soon to follow.
  Still, even if we were voting on some other variation of this 
amendment, I'm not persuaded a constitutional amendment is the best way 
to mend our budget woes. I still believe that if we can succeed through 
a statute rather than through a constitututional amendment, we should 
leave the Constitution alone.
  All of this being said, I do not question the intentions of the 
authors of this amendment. Given our track record on living within our 
means, there are good arguments to be made for this amendment. I have 
long said that as 1 of the 535 Members of Congress we can, and should, 
get down to the work of crafting a reasoned, bipartisan balanced budget 
plan. But we have not managed to do so. We have not managed to muster 
the political will to tackle some of the tougher issues that stand in 
the way of a credible path to balance. We have not managed to talk in a 
meaningful way about how to control our entitlement spending and how to 
prevent that spending from consuming an ever-larger share of our

[[Page S1875]]

Federal budget as time goes by. Absent change, a full 70 percent of the 
Federal budget will be consumed by mandatory spending and interest on 
the debt by the year 2000 and that percentage will continue to climb. 
That is a scary statistic.
  But I think, or at least I very much hope, that we are getting closer 
to having those conversations. Last year, I was part of the centrist 
coalition, a bipartisan group that included 11 Democrats and 11 
Republicans. The coalition spent approximately 5 months putting 
together a balanced budget package which contained significant 
entitlement reform, a reasonable discretionary spending number and 
modest tax relief. The centrist package was offered as a substitute 
budget in May 1996 and received 46 votes in the Senate. As far as I am 
concerned, those 46 votes represent the start of a meaningful effort to 
balance the budget in a bipartisan, credible way.
  Regardless of how today's vote turns out, I hope we will not lose the 
will to move forward to balance the budget. If this amendment were to 
pass both Houses, I would hope that we would not use that passage as an 
excuse to delay balancing the budget while we wait to see if the 
amendment is ratified. And if this amendment fails, I hope that we--
particularly people like me who maintain that we can balance the budget 
without this amendment--will redouble our efforts to get the budget on 
the path to balance in this Congress.
  Mr. MURKOWSKI. Mr. President, in this debate on the balanced budget 
amendment, I believe the Senate has lived up to its reputation as the 
greatest deliberative body in the world, bar none. We have spent nearly 
a month debating this measure and I want to especially commend the 
distinguished chairman of the Judiciary Committee, Senator Hatch, for 
his stamina and intellect in managing this measure.
  Now as the time for debate draws to a close, I hope all of my 
colleagues will reflect on the simple principle that we are attempting 
to incorporate into our Constitution. It is simply that one generation 
of Americans has no right to mortgage future generations to finance our 
daily spending habits. Think about it.
  There is one thing for certain, Mr. President. When the clock strikes 
midnight on December 31, 1999, and we enter the new century, America 
will have run deficits for 31 consecutive years and we will have a 
national debt of more than $6 trillion.
  If we are ever going to reverse that endless tide of red ink, if we 
are going to ease the economic burdens on our children and 
grandchildren, then as a matter of moral responsibility, we will adopt 
this constitutional amendment. If we don't pass the amendment this will 
truly be an American tragedy.
  Mr. LEVIN. Mr. President, once again the Senate is considering a 
constitutional amendment which some claim will lead to a balanced 
Federal budget. The Senate debated and defeated this amendment in the 
last Congress. It has been reported once again by the Senate Judiciary 
Committee, and has received the careful and thorough deliberation by 
the Senate which it deserves.
  Except in unusual circumstances, balancing the budget is the 
responsible thing to do. That is why I have repeatedly supported 
balanced budgets. And, we have made significant progress in the past 4 
years. We have reduced the Federal deficit for 4 years in a row, 
cutting the deficit by more than half from $290 billion in fiscal year 
1992 to $107 billion in fiscal year 1996, from 4.7 percent of the GDP 
in 1992 to 1.4 percent in fiscal year 1996, the lowest in more than 20 
years. In fact, for the first time in years, the real possibility of 
agreement to balance the budget in the next 5 years looms before us.
  At the outset, let's be clear about one thing. The proposed 
constitutional amendment doesn't balance the budget. It tells a future 
Congress to pass legislation to balance the budget. Unless that future 
Congress agrees on legislation, the amendment will not be implemented. 
Why not try to pass the implementation language now before the vote on 
the constitutional amendment so everybody could see how it would work 
and if it would work? Again, without that implementation legislation, 
we're left with a feel good gimmick which would allow Members of 
Congress to claim that the deficit will be cured without actually 
taking the tough steps necessary to do the job. It takes Congress off 
the hook for 5 years or more. And then, Mr. President, there is no 
hook. As the distinguished past president of the American Economic 
Association, Professor Robert Eisner, put it in his excellent article 
January 22 in the Wall Street Journal, the amendment ``might as well 
assert that the waves of the Atlantic Ocean shall not cross a certain 
line''. In other words, the language kicks in in 2002, or later, and 
then there might be no kick.
  As we have seen in the most recent Congress, the debate arises not 
over whether to balance the budget, but rather how to reach that 
balance. The issues which make agreement difficult grow out of 
differences in priorities. The President, in his budget last year and 
again this year, has shown a path to a balanced budget which also 
provides for adequate funding for education, environmental protection, 
Medicare, Medicaid, and other essential Government functions. Many of 
the proponents of this constitutional amendment support a large tax 
break, paid for by larger reductions in Medicare than the President 
proposes. It is in hammering out these priorities that the difficult 
decisions arise. The constitutional amendment before us does nothing to 
advance that process. In fact, since implementing legislation will not 
be required for 5 years at the earliest, it may indeed provide the 
excuse to delay those tough decisions.
  We are told that if Congress is required by the Constitution to pass 
a law to implement a balanced budget, surely Congress will pass such a 
law. Well in 1979, 18 years ago, we passed a law that said, ``Congress 
shall balance the Federal budget.'' That law, Public Law 96-5, was the 
law of the land. Although the Senate passed that provision by a 96 to 2 
vote and the President signed it into law, it did not happen. Saying we 
must balance the budget will not make it happen; unless and until we do 
the hard work of budgeting, it's all just a dodge, and worse, because 
it encourages people to say we are cured before we've taken the 
medicine.
  Mr. President, the plain truth is whether we pass a balanced budget 
amendment or not, it will still take a majority of the votes of the 
Members of each House to make the tough choices needed to cut spending 
or raise taxes. Unless and until we make those choices or adopt some 
process to implement the constitutional amendment, in the absence of a 
congressional majority agreement on how to balance the budget, we will 
not have a balanced budget.
  Every Member of this body knows that we will not get to a balanced 
budget without tough decisions. Adopting a constitutional amendment 
saying some future Congress must make the tough decisions and balance 
the budget not only isn't a substitute for our acting or adopting an 
enforcement mechanism, it will delay those actions because people might 
think we have acted.
  If we are going to get to a balanced budget by 2002, there is a real, 
practical need to adopt the enforcement mechanism now. We all remember 
that, back in 1985, we passed the Gramm-Rudman-Hollings bill, requiring 
a balanced budget by 1991. Two years later, we modified that 
requirement to call for a balanced budget by 1993. Well, 1991 and 1993 
have come and gone, and we still don't have a balanced budget. The 
reason is simple: the Congress never laid out an enforceable mechanism 
of how we were going to get there. Like the balanced budget amendment, 
Gramm-Rudman laid out the targets without enough provisions for how 
they were to be achieved.
  Without any enforceable blueprint, we found ourselves pushed up 
against deadlines we could not meet. We got to the deadline and found 
ourselves confronted with a dropping stock market and the prospect of 
sudden budget cuts that could throw the country into a deep recession. 
We made the only choice we could, protecting the Nation and the economy 
at the cost of not meeting the budget targets.
  The current congressional majority appears committed to marching down 
this same road again. The constitutional amendment before us, like the 
Gramm-Rudman law, would require us to achieve a balanced budget in a 
fixed period of time. It doesn't say how we are supposed to get there 
and stay there.

[[Page S1876]]

  If this Congress fails to face up to the obligation of laying out a 
detailed enforceable plan to reach and maintain a balanced budget as 
required by the amendment, why should we expect future Congresses to be 
any more responsible? If we duck the task of outlining the enforceable 
mechanism and/or the cuts that will get us to a balanced budget by 
2002, and keep us at balance thereafter, we can only expect that the 
next Congress, and the next one after that, will follow the same 
course. If we don't do the hard work this year, we can't expect 
somebody else to do it for us next year.
  If we pass a constitutional amendment requiring a balanced budget 
amendment without an enforcement mechanism, we are going to face the 
same kind of choices we faced with the Gramm-Rudman law. If we don't 
have the will now to plot our course to reach and maintain a balanced 
budget, we will get to 2002 and find that we have to either abandon the 
goal with the increase in cynicism which would accompany it, or risk 
undermining the national defense or pushing the economy into a deep 
recession.
  There is a way to avoid that fate. We can lay out an honest plan and 
an enforceable mechanism, telling the American people how we intend to 
achieve and keep a balanced budget. That would be the honest approach, 
the approach that the American public would respect.
  Even the Wall Street Journal editorial on February 4 stated,

       The notion of amending the Constitution to outlaw budget 
     deficits is silly on any number of counts. Politically it's 
     empty symbolism. Legally it clutters the Constitution with 
     dubious prose * * * The concept embodied in the proposed 
     amendment measures nothing useful; it is at best a 
     distraction, and at worst spreads confusion that will make 
     the right things harder to do, not easier.

  The proposed amendment is full of loopholes and ambiguities, all 
usable when 2002 arrives. For example: First, the implementation of the 
amendment depends on economic estimates that can be made overly 
optimistic if that is what is necessary to project a balanced budget. 
We have seen enough rosy scenarios in the budgets of both Republican 
and Democratic administrations to know how this game is likely to be 
played. For example, in 1981, our estimates were off by $58 billion. In 
1982, our estimates were off by $73 billion. In 1983, our estimates 
were off by $91 billion, and on and on. In 1991, they were off by $119 
billion--$119 billion in one year. You talk about a loophole. This one 
is big enough to drive a $119 billion deficit through. That's bigger 
than our current deficit.
  Second, the amendment requires a balanced budget in each fiscal year. 
Throughout the 1980's Congress and the President artificially lowered 
the reported deficit and met Gramm-Rudman targets by delaying spending 
a few days thereby pushing it from one fiscal year to another. Under 
the proposed amendment, we can expect similar budgetary shell games.
  Third, States with balanced budget requirements have frequently 
avoided them by creating independent or quasi-public agencies and 
placing their expenditures off-budget. We did much the same thing in 
the 1980's with the costs of the savings and loan bail-out. Because the 
amendment does not define key terms such as receipts and outlays, it is 
certain to lead to similar manipulations.
  Fourth, the deficit could be artificially reduced by selling off 
valuable public assets, such as public lands. This approach might 
enable the Federal Government to report a smaller deficit for a few 
years, but would have no impact at all on the structural gap between 
revenues and outlays.
  There are numerous technical problems with the amendment. It does not 
tell us what an outlay is, what a receipt is, or how the Congress will 
monitor and regulate the precise levels of outlays and receipts. But, 
perhaps most importantly, it does not tell us what will happen if 
outlays in fact exceed receipts.
  What would happen if the amendment were ratified, and, by the end of 
a fiscal year, outlays were to exceed revenues, a clear violation of 
the amendment. What would happen? Could the courts step in and enforce 
the amendment?
  According to the authors of the resolution, there would be no remedy, 
unless provided by future legislation. As Senator Hatch explained on 
March 7, 1986, ``[T]here is no question that Congress would have to 
pass implementing legislation to make it effective. In that sense, it 
is not self-executing. . . . It would be the obligation of Cong-ress . 
. . [to] enact legislation that would cause this to come about.''

  The unenforceability of the amendment should not be a problem, the 
authors tell us, because future Congresses would be bound to respect 
the provisions of the amendment and the will of the voters and to 
comply with it in good faith by enacting suitable implementing 
legislation.
  But this argument has two flaws. First, the amendment, if ratified, 
wouldn't take effect until 2002 at the earliest. This Congress wouldn't 
be bound by the provisions of the amendment. The next Congress wouldn't 
be bound. The Congress after that wouldn't be bound. In fact, no 
Congress would be bound by the terms of the amendment to enact 
implementing legislation until 2002 at the earliest, and by then it 
would be too late to take the actions necessary to comply.
  Second, the legislation required to implement this amendment will be 
extremely complex, and, even if everyone acted in good faith, there 
still might be no agreement. Over the last decade, we have enacted into 
law some 50 single-spaced pages of procedures, governing the 
congressional budget process and attempting to rein in uncontrolled 
budget deficits. These provisions set timetables for the congressional 
budget process. They provide the rules for debate for budget matters. 
They spell out points of order that may be raised to keep the budget 
under control. They establish the role of the Congressional Budget 
Office. They provide controls on legislation providing spending 
authority and rules for legislation providing entitlement authority. 
They limit the use of off-budget agencies, programs and activities. 
They establish regulations for the sequestrations and procedures for 
the rescission of appropriated funds.
  Similarly detailed legislation would be required to implement and 
enforce the balanced budget amendment. To give just one example of the 
complex issues that would have to be addressed by such legislation, the 
resolution before us would require that outlays may not exceed 
receipts. However, Congress does not legislate either outlays or 
receipts. The appropriations and revenue measures that we enact lead to 
outlays and receipts, but do not dictate the exact levels of outlays or 
receipts in any given year.
  So Congress would have to establish new mechanisms to control outlays 
and receipts. This raises many difficult questions, on which reasonable 
people could disagree. Let me read from a colloquy between myself and 
Senator Simon about some of these questions:

       Senator LEVIN. How would the monitoring of the flow of 
     receipts and outlays be done to determine whether the budget 
     for any fiscal year is on the track of being balanced? Would 
     this require implementing legislation?
       Senator SIMON. There would have to be monitoring and future 
     legislation would have to take care of the implementation of 
     that monitoring.
       Senator LEVIN. What exactly is the definition of receipts 
     and outlays? Specifically, would the receipts and outlays of 
     Bonneville Power Administration be receipts and outlays of 
     the United States pursuant to this constitutional amendment? 
     Would the answer to these questions require implementing 
     legislation?
       Senator SIMON. Implementing legislation will be needed on 
     some of these peripheral questions, but the intent is clear.
       Senator LEVIN. In an instance in which the OMB and the CBO 
     disagree with each other on what a level of outlays is, how 
     will the dispute be resolved so that it can be determined 
     whether or not outlays exceed receipts?
       Senator SIMON. Future legislation will have to take care of 
     this.
       Senator LEVIN. Who will determine the level of receipts and 
     whether a revenue bill is ``a bill to increase revenues?'' . 
     . . . My question is, what happens if the revenue estimators 
     in the Treasury Department say the bill is revenue neutral, 
     and the Joint Committee on Taxation say the bill will result 
     in a net increase in revenues? Whose estimate will prevail? 
     How will the dispute be resolved?
       Senator SIMON. Future legislation will have to take care of 
     this.
       Senator LEVIN. At what point will it be determined that 
     outlays will in fact exceed revenues and that actions such as 
     a tax increase, spending cuts, or tapping into a rainy

[[Page S1877]]

     day fund will be required? August 1? September 15? Who will 
     make that determination?
       Senator SIMON. There will have to be regular monitoring and 
     future legislation will work out the details.

  Mr. President, these are difficult questions, on which reasonable 
people could disagree. The assumption of the authors that future 
Members of Congress will try, in good faith, to comply with the 
amendment does not mean that a majority of Members of each House of 
Congress will agree on the many issues involved or on whether to 
require sequestration of funds if outlays are determined to exceed 
revenues, or that they will agree on whether to exempt the national 
defense or Social Security payments from such sequestration.
  And what if the future Congress to which we leave these questions 
can't agree? Would dozens of unelected judges assert jurisdiction and 
order spending cuts or tax increases? When the Senate during the 104th 
Congress considered this constitutional amendment, we adopted by a 92 
to 8 vote an amendment offered by Senator Nunn which added language to 
section 6 making it clear that ``the judicial power of the United 
States shall not extend to any case or controversy arising under this 
article except as may be specifically authorized by legislation. . .'' 
This safeguard has been omitted from the version of the constitutional 
amendment which is before us today.
  Since implementation legislation is the essential need, why not pass 
it now? In the 104th Congress, I offered an amendment, defeated on a 62 
to 38 vote, which would have required us to pass the legislation, not 
pass the buck. It provided that the constitutional amendment would be 
submitted to the States for ratification only upon enactment of 
legislation specifying the means for implementing and enforcing the 
provisions of the constitutional amendment. There are two advantages to 
this approach. First, it places the responsibility on this Congress 
instead of leaving it to a future Congress, by delaying the sending of 
the amendment to the States until we act. Second, the States would be 
informed how the enforcement mechanism would work so they could 
consider that in their ratification deliberations. Since it has become 
clear that the majority is unwilling to amend its language in any way 
and is defeating all efforts to improve it, I have decided not to offer 
my amendment again this year.

  I am also concerned that the proposed amendment would permit future 
Congresses to use Social Security funds for balancing the budget. I 
believe that we have a special obligation to protect the Social 
Security trust fund, and that we should not rob that fund to balance 
the budget. The Social Security system is a contract which we have made 
with our senior citizens. We should not allow a circumstance in which 
even unintended effects of a constitutional amendment like the one 
before us could lead to the failure or inability to meet our 
obligations under Social Security. The proponents will claim that this 
would never happen because the constituencies supporting that program 
are politically strong. But, the Constitution is permanent. Political 
circumstance is subject to change. We should not enshrine in the 
Constitution the use of Social Security funds for any purpose other 
than Social Security.
  As the President stated in his letter of January 28, 1997:

       * * * [T]he constitutional amendment to balance the budget 
     could pose grave risks to the Social Security system. 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.

  I am also deeply concerned about the supermajority requirement in 
section 2 of the amendment. This would require 60 percent of the whole 
number of each House in order to raise the debt ceiling. As we learned 
in the last Congress, this represents a grave risk to the ability of 
the Federal Government to meet its obligations. In 1995 and 1996, we 
saw a determined minority, especially in the House of Representatives 
plan and carry out an effort to hold the President hostage by refusing 
to agree to lift the debt ceiling unless he accepted all of the details 
of their budget proposal. The strategy was rejected by the American 
people, in part because a vote to increase the debt ceiling is simply a 
vote to pay the bills we owe: it is simply a vote to honor the 
obligations that the Federal Government has already incurred. 
Reasonable people may differ on whether we should limit future 
obligations and by how much, but I hope nobody in this body believes 
that we should not honor the obligations we have already incurred.
  As Secretary of the Treasury Rubin put it in his testimony before the 
Judiciary Committee:

       The possibility of default should never be on the table. 
     Our creditworthiness is an invaluable national asset that 
     should not be subject to question. Default on payment of our 
     debt would undermine our credibility with respect to meeting 
     financial commitments, and that in turn would have adverse 
     effects for decades to come, especially when our reputation 
     is most important, that is, when the national economy is not 
     healthy. Moreover, a failure to pay interest on our debt 
     could raise the cost of borrowing not only for Government, 
     but for private borrowers from companies to homeowners making 
     payments on an adjustable mortgage.

  Just a year ago we witnessed Secretary Rubin forced to use every 
innovative move within his authority to avoid just such a default while 
incredibly the Chairman of the House Rules Committee was calling for 
his impeachment for doing so.
  The one road we should never take to a balanced budget is the failure 
to pay our lawful debts. But, this amendment would make permanent in 
the Constitution a shift of power to a minority in either House of 
Congress over the issue of whether we pay our bills for our lawful 
debts.
  Some opponents who have addressed this amendment have emphasized the 
danger of putting a rigid straightjacket in the Constitution which 
could deepen an economic emergency. Indeed, more than a thousand 
distinguished economists, including eleven Nobel laureates have 
expressed their opposition to such a constitutional amendment for this 
reason. Some opponents have emphasized the danger of the inclusion of 
Social Security and the unwise requirement of a supermajority in order 
to permit the United States to pay its debts. Others have argued, as 
The Wall Street Journal has, that this amendment is an empty gimmick. 
While it is true that not all of these flaws can be true at the same 
time, it is also true that whether it is a dangerous straight jacket, 
or a dodge which won't work, it's a mistake either way.
  Mr. President, if we want to achieve a balanced budget, there is one 
way to do it. Don't push the problem off onto future Congresses with a 
balanced budget amendment that doesn't even become effective until 2002 
at the earliest. Keep doing the hard work as we have started. Set out a 
plan with real spending targets, real budget cuts laid out on a 
program-by-program and year-by-year basis, and real enforcement 
mechanisms. I believe we are on verge of a plan to reach a balanced 
budget in 5 years in this Congress. We have lowered the deficit for 4 
consecutive years, cutting it by more than half. Let's not be delayed 
or diverted. Let's do the hard work. At best, this amendment is merely 
irrelevant to balancing the budget. At worst, it threatens damage to 
the economy, the Social Security system, and the confidence of the 
American people in their Government. Either way it's a mistake.
  Mr. McCAIN. Mr. President, I rise in strong support of the balanced 
budget constitutional amendment. Passage of this constitutional 
amendment to balance the budget is the only way to provide the needed 
discipline to guarantee our Government's fiscal restraint.
  This constitutional amendment simply requires the Federal 
Government's total outlays not exceed total receipts for any fiscal 
year. It is important to note that Congress may waive this requirement 
if 60 percent of each body votes to do so. The amendment can also be 
waived in times of war. In order to become part of the Constitution, 
two-thirds of the House and Senate must vote in favor of the amendment, 
and then it must be ratified by three-fourths of the States.
  The facts are clear. History has proven that Washington is incapable 
of making the tough spending decisions necessary to put our fiscal 
house in order. Despite endless debate and support for a balanced 
budget, our Federal budget has not been in balance since Neil Armstrong 
landed on the moon 28 years ago.

[[Page S1878]]

  For years, politicians--in Congress and in the White House--have 
talked incessantly about the need and their desire to balance the 
budget. Listen to the following quotes:

       We must balance the federal budget . . . I shall recommend 
     a balanced budget . . .


                            --Richard Nixon

                            January 22, 1970

       With careful planning, efficient management and proper 
     restraint on spending we can move rapidly toward a balanced 
     budget--and we will.


                             --Jimmy Carter

                            January 19, 1978

       The path I've outlined is fair, balanced and realistic . . 
     . aiming toward a balanced budget by the end of the decade.''


                            --Ronald Reagan

                            January 25, 1983

  If only talk meant action.
  Neither the current rhetoric about balancing the budget nor the 
momentary good news that our annual deficits have been coming down more 
than was expected should trick us into believing that we are on the 
right path.
  According to a January 1997 report by the nonpartisan Congressional 
Budget Office [CBO], the deficit will climb from the current $107 
billion to $124 billion this year. And it will not stop there. It will 
increase to $188 billion in 2002 and reach $278 billion in 2007. In 10 
years, without fundamental changes in our spending habits, the deficit 
will be over 2\1/2\ times what it was in 1996. CBO's assessment of 
these skyrocketing deficits is very disturbing:

       The budget deficits projected for the future years are so 
     large that they could put an end to the upward trend in 
     living standards that the Nation has long enjoyed. Thus 
     current U.S. budget policies cannot be sustained without 
     risking substantial economic damage.

  Talk about a risky scheme. ``Substantial economic damage''--the CBO 
report went further, stating that if we fail to bring our deficits to a 
halt, our economy will enter a period of ``accelerating decline.''
  How many warnings will it take to spur us to action? Are there any 
words strong enough to force us to act?
  The number crunchers show us that if we do not act, our children will 
face tax rates of 82 percent. Talk about taxation without 
representation. Staggering statistics show that a child born today will 
have to pay nearly $200,000 in taxes over his or her lifetime just to 
pay interest on the debt.
  Have we completely forgotten Thomas Jefferson's stern warning?

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

  Mr. President, it is clear we have dismissed the moral implications 
of deficit spending. We only need look at the buildup of our national 
debt as proof. Although it took us over 200 years to reach the $1 
trillion debt mark, in less than 20 years the debt has grown more than 
five times. It now stands at a staggering $5.3 trillion. Do you realize 
to pay off this debt, every family of four would have to pay $1,156 a 
month for the next 5 years? That is $38 per day.

  As more than 200 economists told the Congress in an open letter, in 
which they urged support to the balanced budget constitutional 
amendment:

       We have lost the moral sense of fiscal responsibility that 
     served to make formal constitutional restraints unnecessary. 
     We cannot legislate a change in political morality; we can 
     put formal constitutional constraints in place.

  We have a moral obligation to ensure that our children and 
grandchildren and their grandchildren are not burdened with 
backbreaking debt. We are snatching away their prospects of ever 
achieving the American dream. I was struck by a recent report on 
generational accounting that showed a child born today will keep just 
16 percent of their lifetime wages if we do not change the course of 
our Government spending. How can we believe that we are preserving 
liberty and freedom if we are asking our children to surrender 84 
percent of their lifetime earnings to feed the Federal trough? I have 
seven children and three grandchildren. It is simply not fair to my 
children or anyone's children to pass down this legacy of debt.
  Even in this time of some optimism about balancing the budget by the 
year 2002, there are no assurances that we will actually achieve that 
goal or that we will keep the budget in balance beyond 2002. One year 
in balance is not enough. Let us not forget that Congress and the 
President have been trying with little success to balance the budget 
for almost three decades.
  Time and time again, Congress has passed statutes that were supposed 
to restore fiscal discipline--the 1990 budget agreement, Gramm-Rudman-
Hollings I, Gramm-Rudman-Hollings II, just to name a few. 
Unfortunately, good intentions have not produced the desired results. 
Spending targets were adjusted and readjusted. Deadlines came and went. 
Promises of spending restraint were broken again and again. We cannot 
afford any more empty promises.
  Opponents of this amendment will tell you we do not need this 
amendment to balance the budget because both the President and the 
Congress have agreed to work together to balance the budget by the year 
2002. Our well-intentioned colleagues should not be lured into this 
false sense of security that ignores history.

  Since 1960, we have had a balanced Federal budget only one time. Why? 
People in public office like to do popular things. One need only look 
at the budget fiasco of 1995 to realize that balancing the budget is 
neither popular nor easily achievable in today's political climate.
  The late Senator Paul Tsongas put it best:

       If you ask yourself why are these deficits always voted 
     for, the answer is very simple * * * There are a lot of votes 
     in deficit spending. There are no votes in fiscal discipline. 
     What you have here is a sad case of pursuit of self as 
     opposed to pursuit of what is in the national interest. The 
     balanced budget amendment is simply a recognition of that 
     human behavior.

  Now, I want to talk for a moment about Social Security. I had hoped 
that Social Security would have been exempted from the balanced budget 
constitutional amendment, and I voted twice to remove Social Security 
from the effects of this amendment. I believe that exempting Social 
Security--with the caveat that it is administered honestly and we do 
not turn the trust fund into a slush fund for other Federal spending--
would have protected the Social Security trust funds and ensured the 
viability of the system for our current and future retirees.
  At the same time, I fully recognize that exempting Social Security 
from this amendment would force us to address the need for real 
spending reductions in other Federal programs. I believe my record on 
cutting Government spending is pretty clear--I have proven time and 
time again I am willing to make the tough votes to cut popular 
programs. However, I am not sure that some of my colleagues who 
supported the Reid and Dorgan amendments to exempt Social Security 
would actually be willing to rein in spending by the additional $700 
billion necessary to balance the budget without including the Social 
Security trust funds in the calculations.
  Our efforts to exempt Social Security did not prevail. Nonetheless, I 
will be vigilant in my fight to protect the Social Security trust fund 
and end this charade of using trust fund moneys to mask the deficit. I 
know Arizonans do not want their hard-earned dollars invested in the 
Social Security system to be used for studying cow flatulence, shrimp 
aquaculture centers, wood utilization research programs, or potato 
research programs, just to name a few.

  Mr. President, I firmly believe that the most serious threat to 
Social Security at this time is deficit spending and our ever-growing 
national debt. As Robert Myers, the Chief Actuary of the Social 
Security Administration from 1947-1970, stated recently:

       [T]he most serious threat to Social Security is the federal 
     government's fiscal irresponsibility. If we continue to run 
     federal deficits year after year, we will face two dangerous 
     possibilities. Either we will raid the trust funds to pay for 
     our current profligacy, or we will print money, dishonestly 
     inflating our way out of indebtedness. Both cases would 
     devastate the real value of the Social Security Trust Funds. 
     Regaining control of our fiscal affairs is the most important 
     step that we can take to protect the soundness of the Social 
     Security Trust Funds.

  Mr. President, that is exactly what the balanced budget amendment 
would do--it would force us to control our fiscal affairs. Passage of 
this amendment in the Senate is only one small step toward fiscal 
responsibility. This amendment still has a way to go before becoming 
part of our Constitution--the

[[Page S1879]]

most sacred and important document underpinning our Nation's history 
and Government. A tough vote awaits in the House, and then three-
fourths of the States must ratify the amendment.
  But we must move this process forward. The mere fact that this 
amendment has been trapped in Washington for so many years proves just 
how out of touch we are with those we supposedly represent. Poll after 
poll of the American people shows the balanced budget amendment winning 
approval ratings of nearly 80 percent. Yet, Washington politicians want 
to keep this debate inside the beltway, probably because they fear what 
might happen if we let the people decide.
  What are the opponents of this amendment afraid of? Quite simply, 
they are afraid that it will pass. I can understand why they are 
scared. You see, many are spending addicts who have built their entire 
political careers spending other people's money on their own 
priorities. They do not want to part with their Federal credit card 
that has no limits and never comes due. They hide behind excuses about 
why a constitutional amendment requiring a balanced Federal budget will 
not work. They say they support a balanced budget amendment, just not 
this one. Or they talk about balancing the budget, but refuse to 
actually do it.

  In short, they want to protect themselves from making tough spending 
decisions. They prefer the status quo.
  Opponents of this amendment probably understand best the real effect 
of this amendment. They understand that it will be a straitjacket on 
spending.
  However, let me be perfectly clear that nothing in the balanced 
budget amendment precludes Congress from continuing on our current 
path. We could still deficit-spend even with this amendment in effect, 
so long as 60 percent of each House votes in favor of doing so. 
Granted, this would be a tougher hurdle to clear. But why not force 
Congress to live up to a higher standard, to be more accountable, when 
the future prosperity of our country is at stake.
  Finally, the games that politicians in Washington have long played 
will be exposed for what they really are--to use a favorite phrase of 
President Clinton and Vice President Gore from the election--a ``risky 
scheme'' that threatens to devastate Social Security, Medicare, 
education, and the environment.
  Passage of this amendment would finally force Washington to do what 
needs to be done, namely, determine our long-term spending priorities; 
address projected deficits in important programs; shift power back to 
the States, local communities, and families; and provide incentives for 
savings and investment. Perhaps the real fear of this amendment's 
opponents is that President Clinton's own words would finally come to 
fruition--the era of big government would be over.
  Mr. President, we cannot allow career politicians seeking to preserve 
their own interests to hold this amendment hostage any longer. In State 
Houses across the country, we must begin the debate about whether the 
Federal Government should be forced to live within its means.
  I call on every American to read carefully this proposed 
constitutional amendment. Do not be fooled by the scare tactics of 
those who cannot control their hunger for Federal spending. Decide for 
yourself whether it will help or hurt our current state of fiscal 
affairs.
  It is time for real Americans to closely examine all the what ifs and 
the excuses about why we should pass this disciplinary tool, and see if 
they hold water. Unfortunately, we know all too well that all of the 
what ifs and excuses cannot erase the facts.
  In January 1995, the Bipartisan Commission on Entitlement and Tax 
Reform, chaired by Senators Bob Kerrey and John Danforth, warned us 
that in the year 2012, projected spending for entitlements and interest 
on the national debt will consume all tax revenues collected by the 
Federal Government. By 2030, projected spending for Medicare, Medicaid, 
Social Security, and Federal employee retirement programs alone will 
consume all our tax revenues, leaving us nothing to educate our kids, 
keep our streets safe or protect our environment.
  The warnings are clear. Time is wasting. Since we last voted on the 
balanced budget amendment in June 1996, our national debt has increased 
nearly $200 billion. We would be wise to remember the words of one of 
our great founding fathers, Thomas Jefferson:

       I place economy among the first and most important of 
     republican virtues, and public debt as the greatest of 
     dangers to be feared.

  I hope my colleagues will pay heed to Jefferson's sage advice and 
support the balanced budget amendment.
  Mr. KERRY. Mr. President, this has been an unusually enlightening--if 
a bit protracted--debate. We have had this discussion before on a 
number of occasions and I assume we will have it again during this 
Congress. It is my fervent hope that emerging from all this discussion 
will be a general understanding on the part of the American people that 
there is a discernable difference between a balanced budget amendment 
to the Constitution and a balanced budget itself.
  Mr. President, this amendment is as fundamentally flawed this year as 
it was last year. As it is currently drafted, I cannot support it.
  I have come to the floor previously to discuss the detrimental 
effects of this proposed amendment to the Constitution.
  I have discussed at length the particularly odious issue of the 
amendment's supermajority requirement. As I have illustrated in the 
past, Mr. President, the most compelling arguments against this 
amendment as drafted come from the real experts, the Framers of the 
Constitution. I would contend that were they here on the floor of the 
Senate today, they would to a person vote against this amendment 
because it violates the Constitution's most basic tenet--majority rule.
  I have researched this issue, Mr. President; allow me to review it 
briefly. In Federalist 22, Alexander Hamilton called a requirement for 
a quorum of more than a majority poison for a deliberative body. 
Poison, Mr. President, is Hamilton's word, chosen by a Founding Father 
of our democracy, not this Senator from Massachusetts in 1997.
  Let me explore Hamilton's thought further. He elaborates pointedly 
that:

       The necessity of unanimity in public bodies, or something 
     approaching toward it, has been founded upon a supposition 
     that it would contribute to security. But its real operation 
     is to embarrass the administration, to destroy the energy of 
     the Government, and to substitute the pleasure, caprice, or 
     artifices of an insignificant, turbulent, or corrupt junto to 
     the regular deliberations and decisions of a respectable 
     majority.
  Hamilton, Mr. President, was concerned that the requirement of more 
than a majority would allow the minority to rule simply by not showing 
up. ``This situation,'' he said, ``must always savor of weakness--
sometimes border on anarchy.''
  Harsh words, Mr. President, but again, not mine. They were written 
two centuries ago but could not be more prescient and more appropriate 
for this debate.
  Knowing his thoughts on the issue of a supermajority quorum, how do 
you think Hamilton would vote if he stood among us today?
  And how do you think Hamilton and the rest of our Founding Fathers 
would feel if they knew that a collection of Members of Congress could 
pass a constitutional amendment which contains a provision allowing it 
to be waived? Mr. President, the notion that a part of our most 
fundamental document of law can be set aside for a time is ludicrous 
and anathema to the very reasons for having such a governing document 
at all. That's not to say that, given the wording of this 
constitutional amendment proposal, the capability to waive is not 
needed; emphatically, it is. But that necessity does not remove the 
strong undesirability of permitting a waiver of a provision of our 
fundamental governing document.
  Mr. President, if that is not enough to dissuade Senators from 
supporting such a poorly drafted amendment to our Constitution, let me 
explore further what is wrong with the proposal before us. I have come 
to the floor previously and discussed the inherent and 
unprecedented problems with a process which would lead to the Congress 
ceding to the judiciary the power vested in it by the citizenry of this 
Nation to formulate a budget.

  Last year when we considered this amendment, Walter Dellinger, an 
assistant attorney general, testified before the Judiciary Committee. 
Let me remind my colleagues of his analysis. He testified that:


[[Page S1880]]


       should the measure be enforced by the Judiciary, it would 
     produce an unprecendented restructuring of the balance of 
     power between the branches of government. If it proves 
     unenforceable, it would create a quite different but equally 
     troubling hazard; by writing an empty promise into the 
     fundamental charter of our government, it would breed 
     cynicism about our government and diminish respect for the 
     Constitution of the United States and for the rule of law.

  The distinguished professor of law Archibald Cox concurred with this 
view. He states that this amendment:

       would spawn disputes and charges of violation without 
     providing either the means of resolving the disputes or 
     remedies for the actual threatened violations, except to 
     bring the courts * * * into a field for which they are 
     totally unequipped by experience.

  Indeed, the courts are totally unequipped by experience, Mr. 
President, to contend with this amendment should it be made part of our 
Constitution. Unelected judges would be forced to order the Government 
to reduce or stop paying benefits--like Social Security or Medicare--or 
to cut Federal spending. Perhaps the current majority in the Senate has 
no dispute with that. But think of it, Mr. President, unelected judges 
also could order Congress to increase taxes to enforce the 
constitutional requirement to balance the budget. And this has happened 
in our country, I tell my friends on the other side of the aisle, in 
the case of Missouri versus Jenkins.
  But Mr. President, what I believe most renders this amendment as 
drafted unacceptable is that it would achieve the exact opposition of 
its ostensible intention.
  I suppose the proponents believe that this amendment to the 
Constitution would restore and demand fiscal discipline of the Congress 
and the Government. But, Mr. President, deficit reduction, in and of 
itself, is not an economic policy. The jagged, complex, and sometimes 
unpredictable nexus between fiscal and monetary policy forces us to 
maintain comprehensive economic foresight and vision--be vigilant of 
budget constraints, mindful of the markets, cooperative with our chief 
trading partners, careful with inflation and unemployment, responsive 
to the needy, and watchful of the business cycle.
  Those are the ingredients of the plan the Democrats enacted in 1993. 
That's why we reduced the deficit by two-thirds in 4 years. By 1996, 
the Federal deficit had shrunk to 1.4 percent of the gross domestic 
product from 4.7 percent in 1993. That's why inflation and interest 
rates and unemployment are at an all-time low. That's why the market is 
breaking records. That's why the current economic expansion is one of 
the most prolonged positive business cycles in this century. And, 
that's what makes the current debate on this amendment all the more 
ironic.
  Economist after economist including Nobel laureates and Alan 
Greenspan will tell you that this amendment, as drafted, will wreak 
havoc on the Nation's economy. The amendment before us requires the 
budget to operate at balance or surplus, whether economic growth is 
strong or weak. It requires a balanced budget even if economic growth 
is negative. Let me take a moment and explore the consequences of that, 
Mr. President.
  One of the greatest economic achievements of the 20th century has 
been the unglamorous but vital responsive economic system installed by 
the U.S. Government in the aftermath of the Second World War. It is 
obvious in periods of stagnant economic growth that revenues rise more 
slowly. Higher unemployment, fewer people working, fewer people 
paying taxes; slower growth, economic and business contraction, fewer 
companies paying taxes. Mr. President, this is not difficult to 
understand. When these unfortunate economic slowdowns occur now, we 
have a system which alleviates some of the pain felt by individuals and 
companies, and eases us back into economic growth. Federal spending 
increases--especially on programs like unemployment insurance--and 
outlays necessarily exceed revenues. That is economic sense, Mr. 
President.

  This amendment, as it is drafted, works against economic reality and 
risks making recessions more frequent and turning recessions into 
depressions. And I make this statement not based on economic theory 
cooked up in an ivory tower or a think-tank downtown. I make it based 
on the real-life experience of this country during the dark days of the 
1930's. After the stock market crashed in 1929, revenues dropped and 
Congress pursued an economic program which consisted of spending cuts 
and tax increases: the exact course which this amendment would dictate. 
What was the result then, Mr. President? This country experienced its 
most destructive depression. The spending cuts and tax increases 
drained purchasing power from the country and helped make the downturn 
deeper. This amendment will exacerbate the natural business cycle of 
expansion and recession.
  Since the Great Depression and World War II, we have made enormous 
progress in reducing the rollercoaster of the boom and bust cycles and 
this amendment would strip us of that progress and its protections. It 
would remove the fiscal buffer the Federal Government has in place and 
leave the States and individual Americans and American companies to 
bear the brunt of economic downturns.
  The former Director of the Congressional Budget Office, Robert 
Reischauer, agrees. He argues:

       A balanced budget rule could make it even harder to conduct 
     discussions of policies on their own merits, and could lead 
     to distortions of policies simply to meet budget goals. * * * 
     Burdens might be shifted to State and local governments or to 
     the private sector even when the public good would be 
     enhanced by keeping the programs at the Federal level.
  Well, Mr. President, my State can't handle this. For the last two 
decades, Massachusetts has been a recession-prone State. In the late 
1980's, the economy of New England collapsed. While we have crept out 
of the ruins of unemployment and business loss, we must be vigilant not 
to return. Back in the 1980's and early 1990's, I fought hard to 
alleviate the recession in Massachusetts by continuing the flow of 
Federal dollars into the Commonwealth and easing its credit crunch. Mr. 
President, Federal funds were instrumental in jump-starting economic 
growth in Massachusetts: My home State receives more Federal funding 
than 43 other States on a per capita basis and 17 percent more than the 
average State. Massachusetts State secretariats are highly dependent on 
Federal expenditures to help residents of the State overcome the 
negative effects of recessions: In the last fiscal year, Federal 
dollars provided nearly 80 percent of the funding for Massachusetts' 
Health and Human Services secretariat, 77 percent of the education 
secretariat budget, more than half of the housing and community 
development budget and 43 percent of the transportation and 
construction spending.
  If an amendment to the Constitution mandates a balanced budget and my 
State experiences an economic downturn, it will be at the mercy of the 
supermajority of 65 Senators who would have to join me and Senator 
Kennedy in releasing more funds, if necessary, to combat that recession 
and prevent it from wreaking greater havoc.
  Again, Mr. President, this is not pie-in-the-sky speculation. The 
Commonwealth Center for Fiscal Policy predicts that ``a fiscal crisis 
looms for Massachusetts.'' Our fragile State economy will be tested at 
a time when the Federal Government continues to threaten cuts to 
vital transfer payments to States.

  Mr. President, I oppose this amendment as it is drafted for all the 
constitutional and economic reasons I have outlined. Before I conclude, 
I must note to my colleagues that I find it enormously ironic that over 
the next few weeks, we will all line up to vote for one budget or 
another that balances by the year 2002. In fact, the President has 
already submitted his plan and it is, as far as I know, the first one 
on the table to reach balance by that date. I have not yet seen any 
plan from my Republican colleagues, but I am confident that when they 
assemble one, it, too, will balance by 2002. So, you see, Mr. 
President, we all agree on that. Isn't it ironic that now, of all 
times, the drumbeat for a constitutional amendment grows louder? Mr. 
President, where was that drumbeat in the 1980's, when President Reagan 
was running unprecedented deficits? When no balanced budget was in 
sight?
  Let us call this exercise what it is and get back to work to restore 
fiscal responsibility the old-fashioned way--through hard work, not by 
headline grabbing. I yield the floor.

[[Page S1881]]

  Mr. BAUCUS. Mr. President, I rise in support of the balanced budget 
amendment.
  Amending our Constitution is not an action that anyone in this body 
should take lightly. I did not reach my conclusion without a great deal 
of thought and consideration.
  It is time for Congress to pass this amendment and open it up to the 
scrutiny of the State legislatures, the Governors, and the citizens.


                            a brief history

  ``Max, Congress needs to get its act in gear. We need to balance the 
budget.'' Four years ago I heard that everywhere I went in Montana. It 
didn't matter if I was out on one of my workdays or at the county 
fairs; spending time on a dusty ranch, or in the growing cities.
  The deficit had ballooned to $290 billion and it showed no signs of 
shrinking. The deficit was not only running up our national debt, it 
was eating away at the public's confidence in their Government.
  Then, 4 years ago, an interesting thing happened. Congress passed, 
and President Clinton signed, a budget that actually cut our deficit. 
And now for the past 4 years we have shrunk the deficit. Last year the 
Congressional Budget Office estimated that the deficit was down to $107 
billion.
  We can all agree that these are steps in the right direction. But not 
is not the time to start patting ourselves on the back.
  These steps toward solvency are not enough. Montanans still tell me 
that balancing the budget is one of their highest priorities. And it 
should be our top priority.
  I have worked toward a balanced budget for a long time. I believe 
that we need to cut spending, eliminate Government waste, and to create 
a Tax Code which is fair to Montana families.
  I have often been in pretty small company as I have worked for the 
first of those priorities--cutting spending. In 1984, I was joined by 
former Senator Kassebaum, and Senators Grassley and Biden in sponsoring 
an across-the-board freeze on all Government spending. This 1-year 
freeze got just 33 votes. While it would have caused pain in Montana, 
it spread the cuts out to many programs and shared the pain. That's how 
this process must work if we are to get to a balanced budget.

  In 1986, I was the only member of Montana's congressional 
delegation--and the delegation was 33 percent larger then--to vote for 
the Gramm-Rudman-Hollings act. That bill required Congress to meet a 
set of progressively lower budget targets each year. But that bill 
included no plan to get us to our targets.
  I was just one of 31 Senators to join Senator Kerrey in 1994 on a 
bill to cut $9 billion from a number of programs. This package included 
cuts to programs which benefit Montana, like the food aid programs 
which help our wheat farmers and the honey program. And the means 
testing for Medicare part B would have increased medical expenses for 
some Montanans. But it was fair and it represents the task before us. 
There are no simple cuts.
  I have fought Government waste for years. I have long opposed the 
star wars defense system and the space station. In the 103d Congress, 
as chairman of the Committee on the Environment and Public Works, I cut 
$120 million from the Federal courthouse construction budget. Prior to 
that I worked with then-Senator DeConcini to cut $50 million from the 
CIA's National Reconnaissance Office after we caught them wasting money 
on a building with a fountain and a sauna. I am not a newcomer to this 
fight.


                               rationale

  On this floor there has been a lively, principled debate about if, 
when, and how easily this country should run a deficit.
  I do believe that in times of crisis, such as an act of war, we 
should be allowed to run a deficit--temporarily. The last time there 
was a balanced budget or a budget surplus was fiscal year 1969. We have 
been running at a deficit for 28 years now--through three expansions 
and two recessions. To run a deficit for that long--without a clear and 
pressing need--is wrong.
  The time to balance the budget is now.


                     reservations: social security

  I also recognize that we have a commitment to Social Security that we 
cannot ignore. Many Montanans and Americans depend on these benefits 
when they retire.
  We are all aware of the far-reaching budget consequences that will 
result when my generation, the baby boomers, reaches retirement age. 
The strain on the system will be unprecedented, but not insurmountable. 
Through careful planning we can preserve Social Security for all.
  However, I fear that it would only be a matter of time before a mid-
year scramble to meet budget requirements would lead some legislators 
to consider cutting benefits. We cannot let that happen. We must 
protect the Social Security system for our Nation's seniors. I will 
work very hard to do just that.


                               conclusion

  So I urge you all to speak to your constituents. Look deep within 
yourselves and examine your values. Amending our Constitution is--by 
design--a difficult task. Something that cannot be done on a whim.
  I have thought long and hard. And I've concluded that we need to make 
a clean break with the past. We need to establish a new ethic of 
responsibility.
  As I said earlier, there has been a lively and principled debate here 
on the Senate floor. It is now time to expand the debate. Let the 
people decide. I am confident that they will be as cautious and 
thoughtful as we have been.
  The PRESIDING OFFICER. Who yields time?
  Mr. LEAHY. Mr. President, I know that we are supposed to break at 
12:30 unless with consent the managers get more time.
  What is the time situation for the distinguished Senator from Utah 
and the Senator from Vermont?
  The PRESIDING OFFICER. The Senator is correct. The Senator from 
Vermont has 2 minutes and 50 seconds remaining. The Senator from Utah 
has 5 minutes 40 seconds remaining.
  Mr. HATCH. It is my understanding that the distinguished Senator from 
Texas would like to speak. I think he is on his way. As soon as he 
arrives, I would be happy to yield whatever time I have to him.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. LEAHY. 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. LEAHY. Mr. President, how much time does the Senator from Vermont 
have?
  The PRESIDING OFFICER. The Senator from Vermont has 2\1/2\ minutes, 
the Senator from Utah has 3 minutes 20 seconds.
  Mr. LEAHY. I ask unanimous consent that the Senator from Utah and the 
Senator from Vermont be granted an additional 5 minutes each prior to 
breaking for the caucus lunches.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. LEAHY. Mr. President, I yield 6 minutes to the distinguished 
Senator from New Jersey [Mr. Torricelli].
  The PRESIDING OFFICER. The Chair would note that in 6 minutes the 
hour of 12:30 will have arrived and the Senate will then stand in 
recess.
  Mr. LEAHY. No. Mr. President, the unanimous consent was that we go 
beyond that time.
  The PRESIDING OFFICER. If that is the understanding, if there is no 
objection, it is so ordered.
  The Senator from New Jersey is recognized.
  Mr. TORRICELLI. I thank the Chair.
  I thank the Senator from Vermont for yielding.
  Mr. President, several days ago, in an unfortunate and I believe in 
an intemperate moment that does not characterize the distinguished 
majority leader, he made some regrettable comments with regard to 
Members of this institution who as a matter of conscience have decided 
they either needed to change or oppose the resolution offered by the 
Senator from Utah.
  I will not respond in kind to Senator Lott's comments, but I do find 
it necessary today to rise to address once again the question of the 
balanced budget amendment. The issue was raised whether those of us who 
have

[[Page S1882]]

supported a balanced budget amendment were keeping faith with our 
commitments to our constituents by opposing this resolution today.
  I would remind Senator Lott that not only have I supported a balanced 
budget amendment but last week I voted for a balanced budget amendment. 
It is simply not the version he preferred.
  I rise also, Mr. President, because I do believe as well there is a 
burden that has not been met in this institution to those of us who 
support a balanced budget amendment. And that is the concern raised by 
the Treasury Department. The amendment as currently drafted would 
forever preclude the development of a capital budget by the U.S. 
Government. We have asked the majority to address how in voting for a 
balanced budget amendment this concern could be accommodated. We have 
been met by silence. We have asked to have addressed the concerns of 
the CRS and the Treasury Department of how we could ensure the 
integrity and the continuance of our obligations to those on Social 
Security, and it has been met by silence.
  But most interestingly, last week during his otherwise unfortunate 
comments, we were assured by the majority leader that efforts were now 
being taken to reach an accommodation on Senator Feinstein's concerns 
about the development of a capital budget, Senator Johnson's concerns 
about the protection of Social Security, and my concerns with each, 
including the ability of the United States to defend itself militarily 
and to deal with serious economic recessions. Each of us waited since 
Mr. Lott's comments of last Friday for this attempt at reconciliation. 
I was certain, based on Senator Lott's comments repeated again in the 
news on Sunday, that there was a decision to seek some accommodation 
that would allow all of us who believe in a balanced budget amendment 
to vote affirmatively today.
  I regret to inform my colleagues that I have received no such 
communication. I know of no other Member of the Senate who has received 
such communication. I assume, therefore, that either Senator Lott 
misspoke or, somehow, there was something disingenuous about his offer. 
Because my concerns remain. I have voted for a balanced budget 
amendment to the Constitution last week. I would vote for this, but, 
like Senator Johnson, like Senator Feinstein, I have real and lasting 
concerns.
  I want to know that if there is military aggression against the 
United States, we are able to respond with other than a declaration of 
war. I offered an amendment to accommodate those security interests. It 
was defeated. I remain interested, and I believed I was going to 
receive from Senator Lott some communication to accommodate it.
  I remain concerned that, in a serious economic recession or 
depression, the U.S. Government is able to respond, to provide for 
economic needs. I believed, in Senator Lott's communication, he was 
interested in accommodating that concern. It has not happened.
  And I remain concerned, like other Members of the Senate, how we can 
ensure the integrity of Social Security and maintain that commitment to 
our constituents, and how, indeed, we could provide in the future for 
at least the possibility of a capital budget.
  Mr. President, now, only hours before the vote, I am left with this 
question. It seems to be relatively simple to reach some accommodation, 
to engage in some compromise, to reach the concerns of at least one 
Senator on at least one of these issues. The question, therefore, 
before the body is this: Did Senator Lott really ever seek to win this 
fight, or is this an attempt to amend the Constitution that was never 
really designed to succeed? We have waited these several days to hear 
what compromises or new communications the majority leader wanted to 
share with Members of the Senate. Since none have been received, I 
assume none were ever intended.
  I have said previously that I believe the Senator from Utah has a 
good amendment. I also concluded that good was not good enough in 
dealing with an amendment to the Constitution of the United States. The 
Senate can do better. National security, severe economic recessions, 
and the integrity of Social Security are real and lasting concerns.
  My commitment to my constituents is to use my best judgment. My best 
judgment is that there should and can be an amendment to the 
Constitution of the United States to provide for a balanced budget. But 
we accomplish nothing, indeed, do a disservice to the United States, if 
we cannot accommodate the real possibility of dealing with military and 
economic emergencies, and the genuine concern of our constituents in 
dealing with the problems, potentially, of interrupting Social Security 
checks.
  Therefore, Mr. President, with regret, I rise to inform my colleagues 
that what I supposed was an effort at accommodation was never tried 
and, therefore, inevitably failed.
  I thank the Senator from Vermont for yielding time.
  The PRESIDING OFFICER. The time of the Senator has expired. The 
Senator from Utah.
  Mr. HATCH. Mr. President, I yield the remainder of my time to the 
distinguished Senator from Texas, who has played a significant role in 
this and who is one of the brightest people to ever sit in Congress 
with regard to budgetary matters.
  Mr. LEAHY. Is it my understanding, Mr. President, at that time, then, 
all time would be expired?
  The PRESIDING OFFICER. The Senator is correct. The Senator from 
Vermont has 1 second remaining.
  Mr. GRAMM. How much time is there remaining?
  The PRESIDING OFFICER. Seven minutes.
  Mr. GRAMM. Mr. President, first let me thank our dear colleague from 
Utah, Senator Hatch, who has been a great and effective leader on this 
issue. We would not be where we are--that is, as close to the goal line 
as we are--without him.
  Our Senate Democratic colleagues are concerned. We hear it 
everywhere. They are really concerned. I went back this morning and 
looked at every amendment they have offered to the balanced budget 
amendment to the Constitution of the United States and found that they 
are so concerned that they have offered amendments on the floor of the 
Senate to exempt 95 percent of the domestic budget from the balanced 
budget requirement. They are so concerned about balancing the budget 
that they think 95 percent of the things we spend money on domestically 
ought to be exempt. They are so concerned about Social Security that 
they believe we ought to continue to pile up debts.
  We balanced the budget last in 1969. Since 1969, we have piled on 
some $4.8 trillion worth of debt. In fact, just on the debt we have 
incurred since 1969, the last year we balanced the budget, we paid a 
gross interest payment of $320 billion last year. And the Democrats are 
very concerned. They are concerned that if we do not keep piling up 
debt, we may not pay for Social Security. But, since 1969, in piling up 
$4.8 trillion worth of debt, we are paying more interest on that debt 
than we are paying for Social Security retirees today.
  Our Democratic colleagues are so concerned, they remind me of someone 
who would be advising young parents, who have very small children, who 
want to be able to afford for them to go to college--who might advise 
those parents, saying: Don't get in the habit of balancing your budget 
because then you may not send your children to college.
  How in the world can anybody with a straight face--and I understand 
politics--but how can anybody with a straight face stand on the floor 
of the U.S. Senate and say we are in a better position to protect 
Social Security today, paying $320 billion of interest payments per 
year on the debt piled up since 1969, than we would have been if we had 
never incurred that debt, when the interest payment is bigger than what 
we are paying into Social Security for retirees? Does logic have no 
meaning?
  Finally, there is the argument about, well, this is not perfect. This 
just is not quite perfect. Let me say to my colleagues--and this is an 
experience I have had in working with Senator Hatch--we have been 
trying to find perfection here. You know, the Founding Fathers didn't 
find it. If those who remember the story of the miracle at Philadelphia 
will remember back, when Franklin stood to speak he said that he

[[Page S1883]]

didn't believe what they had done was perfect, but he doubted that they 
would do better.
  I have found that every time we try to find perfection, every time we 
try to offer to accept this concern that our Democratic colleagues 
have, they end up backing away from it. There is no one so 
unconvincible as a person who will not be convinced.
  So, I think it is important that the American people understand some 
basic facts about all we are going to do today, since the balanced 
budget amendment to the Constitution is going to fail by one vote. Two 
Members, who voted for this very amendment in the House and who 
campaigned for it, are going to cast votes to kill it today. What are 
we getting out of all this? Let me tell you what the lesson is to the 
Nation. There are 55 Republicans in the Senate, and every one of them--
and I am proud to say every one of them--is going to vote for the 
balanced budget amendment to the Constitution of the United States. Our 
Democratic colleagues, in their concern for everything but deficit 
reduction, have offered amendments to exempt 95 percent of all domestic 
spending from the balanced budget. How can you balance the Federal 
budget when you don't count 95 percent of the domestic items that the 
Government spends money on?
  The plain lesson here is this: Despite all we say in our campaigns, 
despite the fact that there are so many who want the public to listen 
to what they say at home and not look at what they do in Washington, 
the bottom line is, over and over and over again, what our Democratic 
colleagues have shown is that they are not for a balanced budget 
amendment. How can you vote to exempt 95 percent of the budget from the 
balanced budget amendment and be for it? You can always find an excuse 
to not balance the Federal budget. You can always be for it in the 
abstract and not in reality.
  What I want America to get out of this 3-week debate that we have had 
is, there is a clear difference. There is a clear difference. 
Republicans, I am proud to say, are absolutely united, 55 out of 55, in 
favor of requiring, constitutionally, a balanced budget.
  This is not our idea. Thomas Jefferson had come back from France 
where he had been Minister to France during the Constitutional 
Convention, and when he first saw the Constitution, he said if he could 
change one thing, he would limit the ability of Government to borrow 
money to incur debt. And we are here today, over 200 years later, 
trying to fix this problem in the Constitution.
  Some say this is not perfect. Some say, ``Shouldn't we exempt all 
these programs?'' What is more important than the future of our 
children? A baby born in America today, if this current trend of 
spending continues--and it will without this amendment--will pay 
$187,000 of income tax during their working lifetime just to pay 
interest on the public debt.
  When does it end? Obviously, in the minds of our Democratic 
colleagues, not today. We are going to pass a balanced budget 
amendment, but I am very concerned that we are not going to pass it 
until we have a financial crisis, until we are all brought to our 
senses that this debt binge that we are on, mortgaging the future of 
our children, taxing people yet unborn to pay benefits to people today, 
has to end. I wish it were ending today. It is a profound 
disappointment.
  I yield the floor.
  The PRESIDING OFFICER. The Senator's time has expired.
  Mr. MURKOWSKI addressed the Chair.
  The PRESIDING OFFICER. The Senator from Alaska.
  Mr. MURKOWSKI. Mr. President, has all time expired on the pending 
issue?
  The PRESIDING OFFICER. The Senator is correct. Under the previous 
order, the Senate is set to go into recess.
  Mr. MURKOWSKI. I ask unanimous consent that I may speak in morning 
business for 5 or 6 minutes.
  Mr. LEAHY. Reserving the right to object.
  Mr. MURKOWSKI. Not on this subject.
  Mr. LEAHY. Reserving the right to object, and I will not object, if--
I want to accommodate my friend from Alaska--after that, we then recess 
for the party conferences. If he can include that in his unanimous 
consent request, I have no objection.
  The PRESIDING OFFICER. Is there objection to the request as 
propounded? Without objection, it is so ordered.

                          ____________________