[Congressional Record Volume 143, Number 27 (Wednesday, March 5, 1997)]
[Senate]
[Pages S2000-S2001]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

 Mr. ROCKEFELLER. Mr. President, I oppose amending the U.S. 
Constitution with a rigid requirement that every year the Federal 
Government must have a zero budget deficit. I don't think it is 
appropriate to use our Nation's most revered governing document to lock 
in a budget and economic policy that cannot respond to changing needs 
and circumstances. And I do not believe such a requirement could be 
enforced without forcing a constitutional crisis.
  In my view, Congress does not need an amendment to the U.S. 
Constitution to perform its responsibility to enact responsible, 
balanced Federal budgets. The President and the Congress have all the 
tools they need to reduce the deficit, to respond and adapt to the 
country's changing needs, and to keep us militarily and economically 
strong. It is not a constitutional amendment that makes these choices, 
but strong leadership and judgment. We must make the choices through 
realistic cuts in spending, reasonable and fair tax policies, and the 
setting of obtainable goals that show the specifics--every spending cut 
and every tax.
  Congress can and should act to reduce the deficit. A Democratic 
Congress did just that in 1993, and the deficit has been cut by more 
than 60 percent. Including an artificial, unworkable mandate in the 
U.S. Constitution is not the appropriate path to fiscal responsibility.
  I offered and withdrew an amendment which would have protected 
Medicare from the autopilot of the balanced budget amendment. I offered 
the Medicare amendment with the intention of engaging in a debate that 
would expose the balanced budget amendment for the budgetary strait 
jacket that it is. I offered the amendment with the firm belief that a 
debate about the effects of a balanced budget amendment on Medicare may 
help some of my colleagues think through what their actions will mean. 
People don't want Social Security to be used to balance the budget--
and, I believe Medicare is just as important to our constituents as 
Social Security. Medicare provides West Virginia seniors with health 
care security--Social Security with a measure of retirement security. 
My amendment says that the pursuit of a balance budget should not rob 
seniors of the health care security they need and deserve.
  The current constitutional balanced budget amendment, if passed, 
would force deep and devastating cuts on the Medicare Program. Such 
cuts would increase the already too high out of pocket costs senior 
citizens are forced to pay for basic health care. The pending 
constitutional amendment is sure to drive up the percentage of a 
senior's total income they must spend on health care services. 
Currently, seniors' out of pocket costs are, on average, about 21 
percent of their total income. This balanced budget amendment is likely 
to force seniors to spend 25, 30, 35, or even 50 percent of their total 
resources on the health care services they need. This increased burden 
on seniors would force many seniors into poverty and make a greater 
proportion of them dependent on Medicaid services, in essence, 
shifting even more health care costs to the states.

  I want my colleagues to recognize the real world consequences of 
their vote for an automatic, constitutional balanced budget--the 
imposition of devastating cuts in the Medicare Program. Every Senator 
who I have heard speak publicly about Medicare has said they want to 
protect, preserve, and strengthen the program. A balanced budget 
amendment to the Constitution will do the opposite by devastating 
Medicare--simple math tells us this is true. If my colleagues mean it 
when they say they want to protect Medicare, they will oppose this 
constitutional amendment. I urge my colleagues to vote against Medicare 
being used as a piggy bank to be raided at the end of the year, when 
the budget isn't in balance, for whatever unforseen economic reason.
  I think my colleagues should consider the admonition of the Secretary 
of the Treasury about the consequences of a Constitutional balanced 
budget amendment for Medicare beneficiaries. I asked the Secretary what 
he thinks would happen to Medicare beneficiaries under a balanced 
budget amendment when he appeared before the Finance Committee two 
weeks ago. Here is our exchange about the effects of the balanced 
budget amendment:

       Senator Rockfeller. Now we have this thing called a 
     balanced budget amendment, which, according to one of the 
     papers this morning, may lose steam in both chambers, and I 
     hope that is the case.
       But, in the event that it is not, it will be, I think, very 
     problematic for Medicare if we go into a situation where, let 
     us say--Senator Moynihan has heard me talk about this many 
     times --back in the early 1980's in West Virginia we had 
     unemployment that ran up to 21 percent, and devastation to 
     the extent that we were laying off tens of thousands of 
     workers. And this was not common just to West Virginia, it 
     was true in the industrial heartland, as we were making a 
     major economic shift that was painful.
       Now, if that were to happen again, and I see no reason why 
     it will not; Japan is now going through exactly that same 
     kind of difficulty, one that we would not have guessed that 
     they would have gone through 10 years after we did, but they 
     are. They are very down about it. They are going to be fine 
     in the long-term.
       But if we were to run into that situation again in this 
     country and we had a balanced budget amendment and we had to 
     balance by the end of the year and we had to do our part here 
     in Finance, would we not run into what we used to call 
     sequestration?
       Secretary Rubin. I think that you could easily run into a 
     situation, Senator. I think this is only one of the many 
     problems that a balanced budget amendment creates, and that 
     is, I do think it creates an additional threat to Medicare, 
     if that is what you are saying. If you get to the end of the 
     year and there is a very large, unexpected shortfall, which 
     happens from time to time, then I think the President could 
     be in a position where he would be forced to simply cease 
     sending out all checks.
       Well, if you cease sending out all checks you will cease 
     sending out Social Security checks, you will cease sending 
     out Medicare checks, and you will cease sending out all other 
     kinds of checks, I think, instead of being able to deal with 
     it in some sort of a reasonable and sensible fashion.

  The Medicare trust fund should not be used as a cash cow to balance 
the budget in an effort to meet the restrictive requirements of a 
constitutional

[[Page S2001]]

amendment. I believe it is clear that one consequence of Senate Joint 
Resolution 1 would be the Medicare program, which provides health 
services to 38 million senior citizens, will be cut in excess of what 
is required to protect seniors and beyond the dictates of good health 
policy.
  I am committed to charting a positive course for our Nation in the 
21st century, and I believe that we are moving in the right direction. 
Some of us have worked very hard in the recent years to do the job of 
digging out from the exploding deficits of the 1980's, by reducing the 
deficit, and changing the priorities of the Federal budget in order to 
cut waste and increase investment in America's future. I have cast many 
votes in recent years for actual cuts, for detailed changes in policy, 
and for specific budget plans. These are the kinds of real votes that 
have cut the deficit.
  By working out a balance between what must be done to invest in our 
people, and using their hard-earned tax dollars more wisely, we have a 
course that is far less reckless and dangerous than strapping this 
amendment onto the U.S. Constitution. I truly believe we can achieve 
the real goal of a balanced budget amendment--fiscal responsibility--if 
we are brave enough to tackle the real challenges that confront us. For 
the sake of real fiscal responsibility and the sake of West Virginia's 
future, I cast my vote against the constitutional amendment to balance 
the budget.

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