[Congressional Record Volume 144, Number 4 (Monday, February 2, 1998)]
[Senate]
[Pages S258-S261]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                               THE BUDGET

  Mr. HOLLINGS. Madam President, last week in remarks on the floor I 
referred to the Congressional Budget Office's report, ``Economic and 
Budget Outlook for the Fiscal Years 1999 to 2008.'' And at that 
particular time, Madam President, I pointed out that even the 
Congressional Budget Office had projected deficits not only of $188 
billion for the present year and $170 billion for 1998, but of $200 
billion for 1999, the year in which everyone in this town has been 
screaming we will reap a budgetary surplus.
  Now we have the President's budget. Madam President, this morning we 
not only received that budget, we saw in this country's newspapers of 
record such headlines as ``On Budget Eve, Congress Feels Surplus 
Fever.'' This particular article reports that the distinguished Speaker 
of the House, Newt Gingrich, stated, ``We are on the edge, if we will 
have discipline, of a generation of surpluses.''
  So we have the President talking about balanced budgets as far as the 
eye can see in his State of the Union Message. And we now have the 
distinguished Speaker talking about surpluses as far as the eye can see 
for the next generation.
  Would that it were so. Would that we did not have any increase in the 
national debt. Would that we had no increase in the deficit. Would that 
we had no increase in the interest costs of the carrying charges on our 
national debt, which are now projected, Madam President, to be $1 
billion a day, or $365 billion a year. That is one thing that everyone 
can agree on: that the interest on the federal debt is going up, up, 
and away.
  Let me emphasize the matter of the debt before I home in on the 
matter of Social Security and the spending of surpluses. In 1981, we 
had a national debt of $995.5 billion. We had not reached a trillion-
dollar debt.
  For the first 200 years of our history, including the costs of all 
the wars our nation fought during that time--the Revolutionary War, the 
War of 1812, the Mexican-American War, the Civil War, the Spanish-
American War, World War I, World War II, Korea, and Vietnam--we did not 
reach a trillion-dollar debt. But in the last 16 years, we have reached 
now a $5.5 trillion debt, with interest costs of a billion dollars a 
day. Interest on the debt used to stand at a mere $95 billion; it now 
stands at $365 billion. So we are spending $270 billion more on 
interest alone than when we supposedly were going to balance the budget 
back in 1981.
  I remember when our distinguished President Ronald Reagan ran on 
balancing the budget and was elected in 1980. He came into office in 
1981 and said, ``Whoops. This is way worse than I ever expected. 
Instead of balancing the budget in a year, it's going to take me 3 
years.''
  Even after passage of the Gramm-Rudman-Hollings Bill, we ran into the 
highest deficits we ever had heard of. The deficits and debt went up, 
up, and away under Reaganomics. Of course,

[[Page S259]]

the whole idea of Reaganomics, which George Bush called voodoo 
economics, was that cutting tax revenues some 25 percent would spur 
people to spend more, thus leading to increased government revenues 
from sales taxes and income taxes. This in turn, proponents of so-
called Reaganomics said, would enable us to grow out of the federal 
deficit and national debt. In contrast, of course, we have grown into 
them.
  As a result, we now spend a billion dollars a day on interest to 
service the federal debt. The first thing at 8 o'clock every morning 
that the Government does is go down to the bank and borrow a billion 
dollars--every Sunday morning, Christmas morning, every holiday, every 
day in the year. It borrows and spends this billion dollars to pay the 
carrying charges on the debt. This money doesn't go for anything 
constructive: no highways, no foreign aid, no defense money. It's just 
waste added to the debt.

  This is the dilemma we find ourselves in. This is really the bottom 
line. But it has never been emphasized in this body. And momentarily, 
seeing that I had an opportunity to emphasize this on the floor of the 
Senate, I said to myself: ``Now's my chance to sober everyone up, 
because we are spending more and getting less.'' And everybody wonders 
why they are not getting adequate Government services. The reason we 
are not is because we are spending $270 billion more on interest than 
we were spending in 1981. We are spending more for absolutely nothing--
a total of $365 billion for nothing.
  And now we have the President's budget. And as is the usual custom, 
the Administration says one thing and does another. I will never forget 
Attorney General John Mitchell's admonition, ``Watch what we do, not 
what we say.'' That could be the mantra of Congress and the White House 
today: ``Watch what we do, not what we say.''
  Of course, if you look in the very first part of the President's 
budget, you can see projected on page 10 of the budget for next year, 
1999, a $9.5 billion surplus. Isn't that grand? Isn't that wonderful? 
There it is: a $9.5 billion surplus on page 10.
  But, Madam President, let us, if you please, go all the way back to 
page 367 of the President's budget. You have to go search through the 
whole budget. I don't know that anybody has done this, but I have 
learned how to search out the truth in these budgets. On page 367 you 
will find a chart similar to the one by the CBO titled ``Projections of 
the Federal Debt by Fiscal Year.'' You will find the Federal 
Government's financing and debt. And when you look in the very, very 
small print, you will see it under the title ``Total Gross Federal 
Debt.''
  Of course, they have highlighted other elements of the budget, such 
as ``Debt Outstanding End of the Year.'' They have highlighted in bold, 
black letters the ``Debt Subject to Statutory Limitations End of the 
Year.'' But it is in very small letters that they provide the ``Total 
Gross Federal Debt.'' But if you squint your eyes, you can see that the 
debt goes from $5,543.6 billion in 1998 to $5,738.1 billion in 1999.
  So the President, in his own budget--although you have to be a 
detective to find this--projects a deficit that, if adopted, ipso facto 
will be $194.5 billion.
  This is the situation that confronts us. But today one has to read in 
all the papers and magazines about this ``surplus fever and tax cuts''; 
and you have to listen to the debate on the floor. ``No, I think we 
ought to spend more for this program or that program. No, I think we 
ought to have tax cuts. That's what we ought to do with the surplus.''
  Madam President, the only way that anyone can possibly project any 
kind of balanced budget or surplus for next year of $9.5 billion is to 
use the trust funds--not just those of Social Security, because there 
is another $113 billion of Social Security being used--but the $90 
billion in other trust funds.
  The easiest way to figure whether or not you have a deficit is to see 
whether or not you make more money than you spend each year. This works 
for families; it works for everyone. We must look at whether the 
Federal Government receives more money than it spends. Of course, if it 
spends more than it receives, it has a deficit. And that is why you 
must look at the bottom line of the national debt, where you will see 
that we actually spend $194.5 billion more than we take in.
  But the greatest gimmick and the actual fraud, Madam President, is 
the so-called unified budget. Supporters of this sham argue that 
President Lyndon Johnson and the Congress balanced the budget this way 
in 1968-1969. This is absolutely false; absolutely false. President 
Lyndon Baines Johnson did not use any surpluses in order to balance the 
budget.

  Madam President, I have a chart that shows the state of the national 
debt under President Johnson. In fact, it provides the debt under all 
the Presidents, beginning with President Truman in 1945 and continuing 
to February, 1998. I have here the United States' total budget. I have 
the borrowed trust funds. This is in the chart and I ask unanimous 
consent that this be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                           HOLLINGS' BUDGET REALITIES                                           
                                            [In billions of dollars]                                            
----------------------------------------------------------------------------------------------------------------
                                                                              Actual                    Annual  
                                                                Unified      deficit                  increases 
        President and year          U.S. budget    Borrowed     deficit        with       National   in spending
                                     (outlays)   trust funds   with trust    without        debt         for    
                                                                 funds     trust funds                 interest 
----------------------------------------------------------------------------------------------------------------
Truman............................                                                                              
    1945..........................         92.7          5.4        -47.6           --        260.1             
    1946..........................         55.2         -5.0        -15.9        -10.9        271.0             
    1947..........................         34.5         -9.9          4.0        +13.9        257.1             
    1948..........................         29.8          6.7         11.8         +5.1        252.0             
    1949..........................         38.8          1.2          0.6         -0.6        252.6             
    1950..........................         42.6          1.2         -3.1         -4.3        256.9             
    1951..........................         45.5          4.5          6.1         +1.6        255.3             
    1952..........................         67.7          2.3         -1.5         -3.8        259.1             
    1953..........................         76.1          0.4         -6.5         -6.9        266.0             
Eisenhower........................                                                                              
    1954..........................         70.9          3.6         -1.2         -4.8        270.8             
    1955..........................         68.4          0.6         -3.0         -3.6        274.4             
    1956..........................         70.6          2.2          3.9         +1.7        272.7             
    1957..........................         76.6          3.0          3.4         +0.4        272.3             
    1958..........................         82.4          4.6         -2.8         -7.4        279.7             
    1959..........................         92.1         -5.0        -12.8         -7.8        287.5             
    1960..........................         92.2          3.3          0.3         -3.0        290.5             
    1961..........................         97.7         -1.2         -3.3         -2.1        292.6             
Kennedy...........................                                                                              
    1962..........................        106.8          3.2         -7.1        -10.3        302.9          9.1
    1963..........................        111.3          2.6         -4.8         -7.4        310.3          9.9
Johnson...........................                                                                              
    1964..........................        118.5         -0.1         -5.9         -5.8        316.1         10.7
    1965..........................        118.2          4.8         -1.4         -6.2        322.3         11.3
    1966..........................        134.5          2.5         -3.7         -6.2        328.5         12.0
    1967..........................        157.5          3.3         -8.6        -11.9        340.4         13.4
    1968..........................        178.1          3.1        -25.2        -28.3        368.7         14.6
    1969..........................        183.6          0.3          3.2         +2.9        365.8         16.6
Nixon.............................                                                                              
    1970..........................        195.6         12.3         -2.8        -15.1        380.9         19.3
    1971..........................        210.2          4.3        -23.0        -27.3        408.2         21.0
    1972..........................        230.7          4.3        -23.4        -27.7        435.9         21.8
    1973..........................        245.7         15.5        -14.9        -30.4        466.3         24.2
    1974..........................        269.4         11.5         -6.1        -17.6        483.9         29.3

[[Page S260]]

                                                                                                                
Ford..............................                                                                              
    1975..........................        332.3          4.8        -53.2        -58.0        541.9         32.7
    1976..........................        371.8         13.4        -73.7        -87.1        629.0         37.1
Carter............................                                                                              
    1977..........................        409.2         23.7        -53.7        -77.4        706.4         41.9
    1978..........................        458.7         11.0        -59.2        -70.2        776.6         48.7
    1979..........................        503.5         12.2        -40.7        -52.9        829.5         59.9
    1980..........................        590.9          5.8        -73.8        -79.6        909.1         74.8
Reagan............................                                                                              
    1981..........................        678.2          6.7        -79.0        -85.7        994.8         95.5
    1982..........................        745.8         14.5       -128.0       -142.5      1,137.3        117.2
    1983..........................        808.4         26.6       -207.8       -234.4      1,371.7        128.7
    1984..........................        851.8          7.6       -185.4       -193.0      1,564.7        153.9
    1985..........................        946.4         40.5       -212.3       -252.8      1,817.5        178.9
    1986..........................        990.3         81.9       -221.2       -303.1      2,120.6        190.3
    1987..........................      1,003.9         75.7       -149.8       -225.5      2,346.1        195.3
    1988..........................      1,064.1        100.0       -155.2       -255.2      2,601.3        214.1
Bush..............................                                                                              
    1989..........................      1,143.2        114.2       -152.5       -266.7      2,868.3        240.9
    1990..........................      1,252.7        117.4       -221.2       -338.6      3,206.6        264.7
    1991..........................      1,323.8        122.5       -269.4       -391.9      3,598.5        285.5
    1992..........................      1,380.9        113.2       -290.4       -403.6      4,002.1        292.3
Clinton...........................                                                                              
    1993..........................      1,408.2         94.3       -255.0       -349.3      4,351.4        292.5
    1994..........................      1,460.6         89.2       -203.1       -292.3      4,643.7        296.3
    1995..........................      1,514.6        113.4       -163.9       -277.3      4,921.0        332.4
    1996..........................      1,560.3        153.6       -107.3       -260.9      5,181.9        344.0
    1997..........................      1,601.3        165.5        -22.3       -187.8      5,369.7        355.8
    1998..........................      1,670.3        164.8         -5.5       -170.3      5,540.0        365.1
----------------------------------------------------------------------------------------------------------------
 Historical Tables, Budget of the US Government FY 1998; Beginning in 1962 CBO's 1998 Economic and Budget       
  Outlook.                                                                                                      


                  TRUST FUNDS LOOTED TO BALANCE BUDGET                  
                [By fiscal year, in billions of dollars]                
------------------------------------------------------------------------
                                                   1997    1998    2002 
------------------------------------------------------------------------
Social Security.................................     631     732   1,236
Medicare........................................                        
    HI..........................................     117     113     109
    SMI.........................................      34      34      51
Military Retirement.............................     126     133     163
Civilian Retirement.............................     431     460     584
Unemployment....................................      62      72      98
Highway.........................................      22      23      56
Airport.........................................       7      10      30
Railroad Retirement.............................      19      20      23
Other...........................................      53      55      68
                                                 -----------------------
      Total.....................................   1,502   1,652   2,418
------------------------------------------------------------------------

  Mr. HOLLINGS. With this chart, we can see the borrowed trust funds 
and the unified deficit including the trust funds. But then we see the 
actual deficit without the trust funds, the real deficit, with a column 
for each President: Truman, Eisenhower, Kennedy, Johnson, Nixon, Ford, 
Carter, Reagan, Bush and Clinton. This table shows the national debt 
under each President, as well as the annual increases in spending on 
interest costs on that debt.
  If we look at 1968-1969, we find that listed actual trust funds 
totalled $300 million. Since the unified deficit with trust funds was 
$3.2 billion, the actual deficit without Social Security trust funds 
was $2.9 billion. So trust funds were not used to balance the budget. 
This is a fallacious argument.
  In fact, let me clear that up. In those days the distinguished 
Chairman of the Ways and Means Committee was Congressman Wilbur Mills 
of Arkansas. He was the authority on the federal budget and our 
nation's fiscal state. If you ever wanted to find out about a tax or 
revenue, if you ever wanted to talk about fiscal policy or otherwise, 
you went to see Wilbur. He was a brilliant individual. In 1972, he 
entered the Presidential race. Of course, before he got into that 
Presidential race--I cannot remember the exact year he announced--he 
came out and said we had so much money in Social Security that we 
should give recipients a cost-of-living-increase of 10 percent. And 
President Nixon said, ``Well, if Wilbur Mills will give you 10 percent, 
I will give you 15 percent,'' and we started spending away the Social 
Security moneys. We never did have a difficulty with Social Security 
until those shenanigans commenced.
  By 1980, we determined that Social Security would be running into the 
red and we created the Greenspan Commission, under the distinguished 
head of the Federal Reserve, Alan Greenspan. The Greenspan Commission 
came out with a report adopted in 1983, which said that not only are we 
going to balance Social Security's budget, we are going to have an 
inordinately high tax, a graduated tax, to make sure that we build up a 
surplus to take care of the baby boomers. That was the intent of 
building up the surplus. They knew they were going to have extra money. 
It wasn't a mystery because it was an inordinately high tax. They built 
up this surplus intentionally. And Section 21 of the Greenspan 
Commission report states that in order to maintain the surplus for the 
baby boomers through the year 2056, we must take Social Security out of 
the unified budget.
  Now, that is what Greenspan recommended. And this Senator worked as a 
member of the Budget Committee to get that done. Finally, in 1990, we 
reported it out from the Budget Committee by a vote of 20-1 that we do 
just that, take Social Security off budget. And 98 Senators voted for 
that on the floor of the Senate. And President George Bush, on November 
5, 1990, signed section 13-301 into the law. Section 13-301 of the 
budget law says that the Congress and the President you shall not 
submit a budget using Social Security trust funds.
  Of course, that was violated and it is being violated now in this 
particular budget. Right here, it is violated. There is no question it 
is being violated because that is what all the newspapers are reporting 
on--they are talking about page 10, not page 367.
  Here is what has been occurring. Let's go right to Social Security. 
Last year we owed the trust funds $631 billion; by the end of September 
1998, the Congressional Budget Office estimates we will owe $732 
billion; and under the President's budget plan, by the year 2002 we 
will owe $1.236 trillion. Everybody is saying, wait a minute, we have 
to do something because in 10 years Social Security is going to be 
broke. Come on, it is broke now. If we look to the end of this year, we 
will owe Social Security $732 billion. Now, who in the year 2002 is 
going to recommend a tax increase of $1.236 trillion to redeem the 
Social Security IOUs? He will not be able to stand on the floor and get 
one vote. They will run him out. That will not happen.
  That is why this particular Senator has been insistent from the very 
beginning that we look at all the trust funds and the condition of the 
Government--Medicare, military retirement, civilian retirement, 
unemployment, highway, airports--to evaluate the federal deficit and 
debt.
  For example, at the end of this fiscal year we will owe highway trust 
funds $23 billion. Now, why are the highways crumbling and the bridges 
falling? Because the vehicle-automobile, gasoline taxes are not being 
used on the roads and the bridges. They are being used for food stamps, 
for foreign aid, or for any and every other purpose except for 
highways. Why don't we have updated radar at all the major airports in 
the U.S. for passengers' safety? After all, who pays airline tax? But 
the airline tax is not going to the airports. It is going for any and 
every other purpose but the airports. We owe them $10 billion. And I 
don't want to get the military retirees or the Civil Service retirees 
upset, but as of the end of September we will owe $133 billion to make 
payments to them. We will owe $460

[[Page S261]]

billion, almost half a trillion dollars, to civilian retirees.
  This charade, this fraud, has got to stop. It is outrageous that the 
President comes to the American people and says in one breath, 
``Tonight I propose that we reserve 100 percent of the surplus--that is 
every penny of any surplus--until we have taken all the measures 
necessary to strengthen the Social Security system for the 21st 
century.'' And then, after giving that message last week, today he 
comes and loots the Social Security trust fund to the tune of $113 
billion in order to report a $9.5 billion surplus. Of course, all the 
editorial writers and news columnists are writing that we will enjoy 
balanced budgets as far as the eye can see. We will have surpluses as 
far as the eye can see, they say, when the actual deficit under the 
President's budget is $194.5 billion. Look on page 367 of his report 
and you will see nothing but deficits for as far as the eye can see--
namely, the debt increasing; namely, a billion dollars a day being paid 
now with the lowest of interest rates that we have had in our history. 
That amount is going to soar when interest rates rise because spending 
for interest goes up, up and away under the President's budget 
proposal. We really are in a downward spiral of financial 
responsibility here in the National Government.
  Now, I delight in the President's budget with respect to child care. 
I delight in the provisions in there for 100,000 more Border Patrol 
agents; 100,000 more cops; higher pay for teachers; and smaller 
classroom size. But we are going to have to pass a tobacco tax 
settlement or some other measure to get extra moneys for these 
particular programs. This Senator is willing to vote to pay for those 
programs. I am trying to put Government on a pay-as-you-go basis.
  I know about fiscal responsibility. I achieved the first AAA credit 
rating for the State of South Carolina, the first Southern State to 
receive this bond rating. In 1959 I worked like the dickens to get it 
done. I voted for that federal balanced budget in 1968-69. The entire 
budget, with the costs of the war in Vietnam and the Great Society, was 
only $178 billion. Today, we suffer from a $1.7 trillion budget. But we 
balanced it then.
  I was a cosponsor of Gramm-Rudman-Hollings in order to try to cut the 
deficits, but of course the quickest way to anonymity in public office 
is to cosponsor a bill with Senator Gramm or Senator Rudman. I never 
heard since from it but that is how it works around here. But we did 
get the majority of Democratic votes, 14 votes up and down against the 
opposition of the majority leader, the chairman of the Budget Committee 
and the Democratic whip. They all opposed Gramm-Rudman-Hollings, but we 
had a majority of Democrats on this side of the aisle vote for Gramm-
Rudman-Hollings. I even suggested at one time a value-added tax to get 
on top of this sea of red ink, allocated to the deficit and the debt so 
we wouldn't get into this waste of $1 billion a day.
  I am still working now, not just on the amount of the deficit and 
debt but for the principle of truth, truth in budgeting. How do you get 
the national media, the national press, who are co-conspirators in this 
charade, to report the truth. They are talking about conspiracy around 
this town with regard to special prosecutors, when in reality the 
conspiracy is right here, in the so-called unified budget. The budget 
the White House submitted today results without question in a $194.5 
billion deficit if adopted as it is now submitted. It is time everyone 
realize this. It is time we practice truth in governing and reporting.

  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. DORGAN. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DORGAN. Madam President, I ask unanimous consent to speak for 10 
minutes in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________