[Congressional Record Volume 144, Number 44 (Tuesday, April 21, 1998)]
[House]
[Pages H2080-H2088]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          THE BALANCED BUDGET

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 7, 1997, the gentleman from Wisconsin (Mr. Neumann) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. NEUMANN. Mr. Speaker, I rise tonight to talk about an issue that 
is very much on the forefront in America. We are hearing a lot about 
the fact that the budget is finally balanced. We know that in 1995 when 
many of us came here there was this discussion that we were going to 
balance the budget by the year 2002, and now we are hearing in America 
that the budget is balanced today.
  That is good news for the American people, and I would like to spend 
most of the hour tonight talking about what it actually means to have a 
balanced budget and how Social Security fits into this discussion. And 
I guess most important of all, like I found out in my town hall 
meetings back home, we had 14 of them over the last week, how it is 
that Washington's idea and definition of a balanced budget, albeit the 
same since 1969, is very different than what the people in Wisconsin 
think and probably what most of America thinks in terms of a budget 
being balanced.
  I thought I would start with a chart that shows what it was like in 
1995 when we first got here. In 1995 when we first got here, the 
President made a budget projection and he presented us his version of 
what we should be doing. This red line shows where the deficit was 
headed in 1995 when we got here, if we had played golf, basketball and 
tennis instead of doing our job. But we did not play golf, basketball 
and tennis. We fought hard to get Washington spending under control.
  Over a two-year period of time we brought the growth rate of 
Washington spending down by virtually 50 percent. In two short years it 
came from 5.2 percent, that is how fast it was growing when we got 
here, down to 2.8 percent. That is how fast it is growing today.
  This yellow line on the chart shows what happened in our first 12 
months in office, and my colleagues can see the deficit projections 
were coming down already after only 12 months in office.
  The green line shows what we had hoped to accomplish, and that is the 
plan that we laid out when we got here to get to a balanced budget by 
the year 2002. And virtually all of America heard about it, but our 
constituents said, ``I do not believe they are going to do it.'' That 
is what they said back home.
  The facts are in, and for the last 12 months running we not only got 
to a balanced budget by 2002, we are actually there four years ahead of 
schedule. Remember, this is the Washington definition of a balanced 
budget. For the last 12 months running, the United States Government 
spent less money than they had in their checkbook for the first time 
since 1969.
  Now, when I get into this discussion about how this relates to Social 
Security, many of us are not going to like the Washington definition 
very well. But this should in no way take credit away from the fact 
that this has been done for the first time since 1969.

                              {time}  1900

  In 1969, I was a sophomore in high school dating the young lady who 
now happens to be my wife so I know that was a long time ago, the last 
time this actually happened, and America should be cheering for this. 
We have come so far in such a short period of time.
  I would like to focus on what this actually means because there seems 
to be a lot of disagreement, and Lord only knows, a lot of 
misunderstanding on exactly what this means when we say we have a 
balanced budget. I would like to start with exactly what Washington's 
definition of a balanced budget is.
  I come from the business world. This is the first office I have ever 
held. We were a home-building business. We would not have defined it in 
the same way that Washington does out there in the business world. 
Washington looks at the total number of dollars coming in, at the total 
amount of taxes the American people pay. They add up all of that money 
coming in. Then they

[[Page H2081]]

look at their checkbook, and they figure out how many checks they wrote 
out. And at the end of the year, for the first time there was actually 
more money coming in than what they wrote out in checks.
  Again, make no mistake, this side of the picture, the dollars coming 
in, is clearly a result of a strong economy. So let us not give any 
politicians credit for these dollars coming in because, in fact, that 
is the hard work of the American people. That is the people that get up 
in the morning, go to work every day of the week, and earn a salary, 
and then send taxes to Washington. It is their money that we are 
talking about. And with the economy very strong, welfare reform was 
passed, able-bodied welfare recipients have returned to the work force. 
Those folks started paying taxes in, and that is why the amount of 
money coming in has been very strong.
  But that is not the end of the picture. On the other side, the money 
going out, the rate at which that money is going out, the growth rate 
has been slowed by 50 percent in these 3 short years.
  Together those two things have led us to a point where we have what 
Washington calls a balanced budget. I would like to go further with the 
definition because it is important that everyone understands exactly 
what they mean by a balanced budget so we understand just how far we 
have to go. And the rest of this discussion should in no way take any 
credit away from the fact that this has actually happened for the first 
time since 1969.
  To understand what actually is happening in this budgetary process, I 
would encourage my colleagues to think of a pension fund, and think of 
a business running a pension fund; only in this case the pension fund 
is Social Security.
  What I have on this board is the total dollars coming in being 
collected out of the American taxpayers' paycheck for Social Security. 
We are collecting $480 billion for Social Security this year; that is, 
when you look at your pay stub, if you are out there, a hard-working 
American, you look at your pay stub, that money coming in for Social 
Security equals $480 billion. The total amount being paid back out to 
our senior citizens in benefits is $382 billion.
  This is not really hard to understand. It is very much like your 
checkbook if you sit down at your kitchen table. If you have $480 in 
your checkbook, and you write out a 382-dollar check, your checks do 
not bounce. It works fine. As a matter of fact, you have $98 billion 
left in your checkbook.
  What is going on in Social Security is that $98 is supposed to be put 
into a savings account. We all know that people in my age group, the 
baby-boom generation is rapidly heading toward retirement, and there is 
lots of us. As a matter of fact, there is lots more of us than there 
are seniors today.
  When we get to the retirement years, since there are so many of us, 
it means there will be more money going out than what there is coming 
in. It is exactly the opposite of the picture that we have today. The 
idea is this $98 billion goes into a savings account, and it is much 
like we do in our own family. When there is more money going out than 
what we have coming in, we then go to that savings account, get the 
money out, and Social Security works. That is how Social Security is 
supposed to work today.
  Now, I would like to point out that these two numbers, they turn 
around in about the year 2012. So from now through 2012, we have more 
money coming into the system than what we are paying back out. As a 
matter of fact, the rest is supposed to go into a savings account.
  When I am in my town hall meetings back home in Wisconsin, it did not 
matter if I was in Beloit, Janesville, Kenosha, Racine or Burlington, 
wherever I was, I would ask the question, what do you suppose 
Washington does with that $98 billion that they have extra coming in 
from Social Security? They would all start laughing, and they would 
say, well, obviously they spend it. The right answer; that is exactly 
correct. The American people understand that, and they know that is 
what is going on out here.
  Let me be very specific on how it works out here. That extra $98 
billion comes in. Think of this middle circle as the big government 
checkbook because that is where it goes. It gets deposited directly 
into the big government checkbook. Washington then writes checks out of 
their big government checkbook. Remember the first picture we had up 
here. When the dollars in equals the dollars out, we call that a 
balanced budget.
  You see, however, what is wrong with that picture. That balanced 
budget, those dollars going into the big government checkbook, those 
dollars going into that checkbook, include this Social Security 
surplus. When they look at the dollars going out of that checkbook, it 
does not include a check going down here to the Social Security Trust 
Fund. So when we talk about a balanced budget in Washington, D.C., 
please do not shoot the messenger; this is the way it has been defined 
for many, many years before I got here, all the way back to 1969. They 
have defined this thing to be, with these extra dollars coming in, if 
we can just get this checkbook so we are not writing out more checks 
than what we are taking in, we are going to call that a balanced 
budget. That has been the definition.
  Remember, since 1969, we have not even balanced the budget even 
utilizing the extra money coming from Social Security. So while it is 
an important and a first step forward, I think most people in America 
would understand and realize that in order to truly balance the budget, 
we need to write a check out of that checkbook down here to the Social 
Security Trust Fund so that there is actually real money in the Social 
Security Trust Fund.
  What we do today, that $98 billion goes into the big government 
checkbook. They spend all the money out of the big government 
checkbook. And since there is no money left to put a check down here, 
we simply write an IOU to the Social Security Trust Fund. That IOU, let 
me be very technical about it, that IOU is called a nonnegotiable 
treasury bond.
  A nonnegotiable treasury bond is very simply something that cannot be 
sold. The problem with this is if you have got a bond in there that 
cannot be sold, and we get to the year 2012, remember that is the year 
where there is more money going out because us baby-boom generation 
people are getting there so there is more money going out than what 
there is coming in. If this thing is full of IOUs, nonnegotiable, 
nonmarketable treasury bonds, the question that most logical thinking 
people would ask is: Where are they going to get the money from in 2012 
to keep Social Security going?

  There is only three possible answers to that: One is they can raise 
taxes on the American workers. That is a bad idea. The second one is 
they can simply borrow more money, and that is a bad idea because that 
makes the situation worse for our children. The third one, of course, 
is to reduce spending elsewhere in Washington, and I mean I think that 
is a great idea. But the problem with that idea is, what is the 
probability of it actually happening as opposed to simply going out and 
borrowing the money.
  The real point here, what needs to be done in Washington, D.C., and 
we have written the legislation to do it; I see my good friend from 
Minnesota has joined me, and in spite of the tie he has on, I am going 
to invite him into this conversation. But I would like to just point 
out that we have written legislation that would specifically take that 
$98 billion extra that is coming from Social Security and put it 
directly down here into the Social Security Trust Fund.
  The bill is called the Social Security Preservation Act. It is H.R. 
857, and it effectively stops the government from spending money that 
is supposed to be set aside for Social Security. This means when we get 
to the year 2012, the government can go down here to the Social 
Security Trust Fund; we will have negotiable treasury bonds; that is, a 
treasury bond that anybody can go to their local bank and buy.
  When I was at our town hall meetings, I asked our seniors if they 
knew what a treasury bond was. I would say at every meeting we had 
three or four that actually owned treasury bonds because they had 
bought them at their local bank. What we are suggesting we do is put 
that right down here in nonnegotiable treasury bonds, regular T bills 
that you can buy at your local bank. Then, when 2012 gets here, we 
simply go to the trust fund, sell the

[[Page H2082]]

treasury bond, get the money, and Social Security is solvent.
  I need to be very specific on this, though, because while that solves 
the problem in 2012, this works much like your home checkbook. If you 
overdraw your checkbook this month, you go to your savings account and 
you get the money, and you put it in your checkbook and make good, 
everything is fine. But then next month, you overdraw your checkbook 
again, go to the savings account, get the money, and everything is 
fine. But if you keep doing that month after month after month, which 
is what happens in Social Security beyond the year 2012, eventually 
what would happen to your savings account, of course, is you would run 
out of money.
  In the Social Security system, even if all of the money is in the 
trust fund that is supposed to be there, including repayment of the 
money that was supposed to have been put there in the first place, even 
if all of that money is there, their savings account reaches zero in 
the year 2029. So that is why we are hearing all of this discussion 
about Social Security today. Two thousand twelve, we are okay if there 
is really money in the Social Security Trust Fund.
  If H.R. 857, the Social Security Preservation Act passes, and the 
trust fund is full of real money, we are okay in the year 2012. But our 
savings account runs out of money, much as your personal savings 
account would eventually run out of money if you kept overdrawing your 
checkbook; the Social Security Trust Fund savings account also runs out 
of money in the year 2029.
  I yield to the gentleman from Minnesota (Mr. Gutknecht).
  Mr. GUTKNECHT. I would like to thank the gentleman for yielding to 
me, and despite the tie, I am delighted to be with you tonight. I just 
want you to know my brother gave me this tie so if he is watching back 
home, he will know what you had to say about it.
  Mr. NEUMANN. That was a compliment.
  Mr. GUTKNECHT. I want to congratulate you for all that you have done; 
not so much just in balancing the budget, because I think members of 
the Committee on the Budget, and you also are on the important 
Committee on Appropriations. I do not know of anybody who has fought 
more to balance the budget, to fight wasteful Washington spending than 
you have.
  I am glad you are talking a little tonight about Social Security and 
Medicare and seniors issues because you are not only a cosponsor of the 
Social Security Preservation Act, but you are also a very important 
proponent of trying to solve the notch issue. I know that I and many of 
my colleagues, I expect, I heard you mention that you had town hall 
meetings during the Easter break as well. Almost everywhere I went when 
I met with seniors, someone raised the issue of the notch baby problem. 
And I do not know if you spent any time talking about that, but this is 
really an issue, particularly now, I think, that at least we are moving 
towards a surplus using the old accounting method here in Washington; 
that maybe this is the time, this is the year we can finally do 
something to bring about some fairness to those folks who are called 
notch babies.
  I have a particular interest, perhaps a parochial interest, if you 
will, in this issue because my father is a notch baby. Every so often 
when I am home for a family reunion or weekend, whatever, he reminds me 
that notch babies have been treated unfairly by the system. And up 
until this point there have not been many Members in this House, or in 
this city, who have been willing to seriously deal with the issue.
  I just wanted to congratulate you. I am a proud cosponsor of H.R. 
3008 for the first time giving some kind of lump sum payments, and I 
think the bill originally called for a $5,000 lump sum payment. I am 
not certain if ultimately that will be the number, but clearly the time 
has come to recognize the inequity and perhaps you want to talk a 
little bit tonight about the notch-baby problem. I suspect there are 
many people who are watching who have a very strong interest in it.
  Mr. NEUMANN. Well, when we wrote the notch bill, we wrote it very 
different this time. As a matter of fact, when I have been on the floor 
of the House sometimes Members have said this has been discussed 
before, and we cannot do anything about it. But we wrote the notch bill 
very different this time than in the past.
  In the past, when they proposed fixes to the notch problem, and let 
me make it very clear, I have got the numbers in my office on this. The 
notch babies are not getting an equitable monthly payment in Social 
Security when compared to other people who have paid exactly the same 
amount into the system. When we wrote the notch bill this time, we went 
to other parts of the budget and we said, look, this is not right what 
is happening to seniors here. We are going to reduce spending over here 
in order to provide the money necessary to correct the notch problem 
that is very real.

  And the bill we wrote does two things. It gives our senior citizens 
the option of one of two things: They can either correct their monthly 
payment, or get to a monthly payment that is approximately equal to 
other people who have paid the same amount into the system, or they can 
take the $5,000 lump sum payment paid over a 4-year period of time. It 
would be their choice as to which one of these two that they were to 
receive.
  But the gentleman is absolutely correct. The senior citizens that 
were born in those years that are commonly called the notch babies, 
they are certainly not receiving a fair payment back in the Social 
Security system. I personally think it is high time something got done 
about it. The group that came in in 1995, this is really the first time 
we are starting to discuss this in depth. The problem should be fixed 
and it should be fixed today.
  Mr. GUTKNECHT. Just for the Members who may not know, these are 
principally people born between the years 1917 and 1926. And there is 
almost something cynical about this.
  Most of my seniors are not particularly cynical people, but it does 
almost seem as if Members of Congress in the past said, well, if we 
just let this thing go eventually all of these people will die off, and 
it is not a problem anymore. I hope that we are bigger than that. I 
hope we are better than that. I think, hopefully, we can find the funds 
this year within the budget to take care of those people.
  I would also like to talk a little bit about how important and the 
work that has gone, and I am not certain how many of your slides you 
have shown tonight talking about the seriousness of the debt and how 
far we have come. I think we need to remind ourselves once in a while 
that under the old accounting standards, and going back to about 1964, 
and what we call the unified budget, we have literally taken those 
excess Social Security funds and used them to mask the deficit.
  Now, some people say that happened because people back in the mid-
1960s wanted to hide the cost both of the Vietnam War as well as the 
great society. And this was a way of being able to spend the money 
without having to recognize the trust fund obligations that we had 
ultimately to Social Security. So I think the time has come, because we 
have come so far with balancing the budget. We have eliminated over 300 
programs. We have cut the rate of growth in Federal spending in the 
last 3 years by almost 50 percent. We are closer today, and probably 
you have done a better job even than the Congressional Budget Office in 
terms of predicting where we would be relative to the balance and 
ultimately to a surplus.

                              {time}  1915

  Mr. NEUMANN. Mr. Speaker, reclaiming my time, if we look at what is 
happening in America today and we look at the revenue growth rate and 
the spending growth rate, and to most American citizens they do not 
want to know about all that stuff, that is our job to know that stuff, 
but when we look at what is actually happening out there today, the 
surpluses, by the old definition, will exceed the amount of money that 
is necessary to be put aside for Social Security in the near term.
  Let me make this very, very clear. Even setting Social Security money 
aside, we will be running surpluses by the year 2000, 2001 as large as 
$250 billion. Take out the Social Security money and we still have got 
a $150 billion surplus by the year 2001 or thereabouts. And I think it 
is very important that the American people engage

[[Page H2083]]

in this debate right now as to what they would like to see done with 
this surplus.
  And, again, let us be real about this. If we go into a recession, 
this is not going to happen. If we have a war, this is not going to 
happen. But if things keep going the way they are right now today, if 
we do not have a major economic downturn, we are looking at surpluses 
that are large enough to set aside the Social Security money the way we 
should and still have about $150 billion left over.
  Mr. GUTKNECHT. If the gentleman would yield further, though, there is 
one more caveat that he did not mention; and that is that we do not 
return to spending normally. The pressure to spend in this town, the 
propensity of Washington to spend money that is not ours, it is so easy 
to spend other people's money and it is even easier to spend the money 
of people who are not yet born.
  We have our friend the gentleman from South Dakota (Mr. Thune) 
joining us.
  I want to share one more thought. All of us are no more than one 
generation removed from the farm, and this is something I talked about 
in some of my town hall meetings in terms of balancing the budget and 
ultimately paying off some of that national debt. And my colleague and 
I are cosponsors of a bill which, ultimately, if we could get the 
Congress to agree to it, would actually pay off the debt. Let me share 
before we yield to our friend from South Dakota.
  Historically, particularly people out in the farm understand this, 
that the American dream was to pay off the mortgage and leave our kids 
the farm. And what Congress had been doing for the last 30 years is we 
have been literally selling off the farm and leaving our kids with the 
mortgage. And it is time that that change.
  Mr. NEUMANN. That is what this picture really shows. This picture 
shows the growing debt facing the United States of America. From 1960 
to 1980, it did not grow very much. But from 1980, that is where that 
huge growth rate has been. Where we go to with this discussion of 
surpluses beyond the Social Security money, that is, even if we set the 
Social Security money aside, is still a surplus of $150 billion. What 
it does is put us in a position where we can start dealing with paying 
back some of this debt. We can start dealing with putting the money 
back into the Social Security Trust Fund that has been taken out 
basically over the last 15 years.
  It is important to note when we look at this debt picture that part 
of the red that we are seeing in this debt picture is the Social 
Security Trust Fund money that has been taken out over the last 15 
years. So, as we start repaying the Federal debt, we can also put the 
money back into the Social Security Trust Fund.
  I guess if I were to look at this surplus personally, I would say we 
have three major problems facing the United States of America, and my 
colleagues might join me in this. I think the three problems we have 
facing America, economically at least, are the debt of $5\1/2\ 
trillion, and we ought to be making payments on the debt, much like 
people would make payments on their own home mortgage.
  Taxes are too high in America. Americans pay $37 out of every $100 
they earn in taxes at some form of government level today. Would it not 
it be nice if we could get that back to where it was in 1955, say to 
$25 out of every $100 they earn?
  And the third problem is the Social Security system. Because even if 
we are paying down debt, getting all the money into the trust fund that 
belongs there, we still have the long-term problem out in 2029 where, 
ultimately, the Social Security savings account runs out of money.
  So those are three problems that need to be fixed, and the debt needs 
to be repaid. Taxes are too high, and they need to be brought down, and 
we need to restore the Social Security Trust Fund. And, of course, the 
gentleman is a cosponsor of a bill, the National Debt Repayment Act, 
that literally takes the surpluses and divides it equally amongst those 
three categories for purposes of paying down debt, restoring long-term 
Social Security and lowering taxes on Americans.
  I yield to the gentleman from South Dakota (Mr. Thune).
  Mr. THUNE. Mr. Speaker, I want to thank the gentleman from Wisconsin 
for yielding, and I would suspect, and the gentleman from Minnesota 
here, my colleague to the east, and I would guess that their 
congressional districts are not very much unlike my State of South 
Dakota, and I represent the entire State.
  But I would like to credit the gentleman from Wisconsin for the 
exemplary leadership he has taken on this issue. Because I think one of 
the reasons that we are having this discussion today is that the class 
that my two colleagues came in with back in 1995 got this spending 
situation into control and basically injected a new discipline into the 
process out here, and I think that has helped propel us to where we are 
both in terms of the economy and what we are going to be able to do to 
address the debt situation.
  In fact, the gentleman from Minnesota made the comment earlier that 
there is CBO and OMB and there is always this raging debate about whose 
numbers are more accurate, and I think we ought to have the Neumann 
rule. The Neumann law would be the one that works, because I think he 
has proven in the past to be the most accurate predictor of what some 
of these economic assumptions and what some of these budget numbers are 
going to be.
  But let me just say, because I think it is very important to note 
what my colleagues are attempting to do here, and that is to put us on 
a path to fiscal responsibility in the future so we do not end up 
selling the farm out from beneath our children and grandchildren.
  Many of the proposals that the gentleman from Wisconsin, I am a 
cosponsor of one as our friend from Minnesota, address this issue in a 
very systematic way and start working down debt, paying down debt, 
lowering taxes and again in a very systematic, disciplined and 
deliberate way, so that in the next 30 years we will have eliminated 
this.
  It is a novel concept in this town to talk about spending only 99 
percent of what you take in; and, ultimately, what we are going to have 
to do if we are going to get this under control is limit the amount the 
Federal Government takes in the first place. Because both my colleagues 
have noted that once it ends up in this town, it is going to get spent; 
and the only way we can avoid that is to leave the money at home and 
make the Federal budget smaller and the family budget bigger. And, 
again, I think that has been the objective of many of us here in this 
Congress.
  It was interesting to me because, as I traveled the State of South 
Dakota this last week, I heard a lot about commodity prices; and there 
was a concern about wheat and corn. I am sure my colleagues all heard 
that, too, some about transportation funding, because that is important 
in my State, a number of issues that were brought up.
  But I walked into a gas station in Aberdeen, South Dakota; and as I 
was going up to pay for the gas, the lady at the checkout said, ``You 
know, Congressman, working families need lower taxes.'' She went on to 
explain that she and her husband both work. They are raising children. 
They are trying to educate their children. They are trying to put away 
a little money for retirement. And she understands full well that 
the way that we liberate and help working families in this country is 
not by forcing more government solutions down their throat but by 
allowing them to keep more of what they earn so the decisions about 
their daily lives, the things that affect them, like education, like 
retirement, like health care, like child care, are decisions that they 
are able to make.

  That again I think is the direction in which the gentleman from 
Wisconsin in his legislation moves this country, and that is a very 
positive one. Because, again, I believe it shifts power and control and 
authority out of this city and back home; and that is something that 
the liberals have a big time with.
  Mr. NEUMANN. In one of my town hall meetings, and my colleague 
mentioned this, bring the taxes down, we had a person sitting there and 
he was clearly not what we would call a supporter of Mark Neumann, and 
he said, ``We don't need lower taxes. We don't need tax cuts. We need 
higher paying jobs.'' And I am thinking to myself,

[[Page H2084]]

higher paying jobs, is that not for more money in our take-home 
paycheck and is that not exactly what the tax cuts do is provide more 
take-home pay for those workers? But somehow they have got this 
ingrained message we need higher paying jobs.
  Well, the facts are, the reason they need higher paying jobs is 
because the Government overtaxes them. If the Government would let them 
keep more of their own money, it effectively creates a higher paying 
job by letting them keep more of their own money.
  That family my colleague was talking about, did he go through the tax 
cuts we just passed to them? How many kids do they have?
  Mr. THUNE. Well, I should have. I did not ask specifically how many. 
But I should have walked through the things that happened last year and 
how she and her family are going to benefit from that.
  You go across the board in my State of South Dakota, because we are 
basically small businesses, farmers, ranchers, and you look at the 
death tax and rolling that back and the capital gains tax and rolling 
that back and the family credit and Hope scholarship, all of these 
things were done with an eye toward allowing working families to have 
more control over their own future.
  Mr. NEUMANN. Let us be very, very specific. Let us assume that this 
young lady that my colleague talked to at the gas station had three 
kids. Next year, when they figure out their taxes and their family and 
they get to the bottom line, they subtract off $1,200, $400 for each 
one of those children under the age of 17. That was the tax cut package 
that was signed into law last year. If they have some in college, they 
will get to the bottom line of their taxes and for a freshman or 
sophomore they subtract off $1,500 to help pay for that college 
tuition.
  I had a bunch of high school seniors out here in the last couple 
weeks from a couple of our different high schools around and I asked 
them, did you know that next year when you go to pay your college 
tuition your parents are going to get a $1,500 tax credit? That is, 
they figure out how much they would have sent to Washington and they 
subtract $1,500 off the bottom line to help pay for their college. A 
lot of them do not even know about it yet, but this is there and 
available. Juniors and seniors, it is 20 percent of the first $5,000, 
or $1,000.
  My colleague mentioned the capital gains, rolling it back. Let us be 
very specific. The amazing thing to me in our town hall meetings, and, 
remember, this is not Republicans in our town hall meetings. This is 
Republicans, Independents, Democrats. It is Americans, which is exactly 
the way town hall meetings should be. They are open and publicized and 
everybody comes.
  When I asked the question, ``How many in this room own a stock, a 
bond, or mutual fund or participate in a 401(k) retirement plan,'' it 
is amazing. I would say it is 99 percent in those rooms. And the next 
thing I say is, ``By the way, I hope if you invested in stocks or bonds 
or mutual funds you made a profit, because that is what your investment 
is all about and that is right.''
  The capital gains tax reduction that we passed last year means that 
if they make a profit, say they make $100 selling some stock they own, 
instead of sending $28 out of that $100 to Washington, they send $20. 
And if they are earning less than $40,000 a year, and it is amazing 
again, the number of people earning less than $40,000 a year that have 
also invested in stocks and bonds, if they are earning less than 
$40,000 a year, instead of sending Washington $15 out of the $100 they 
made, they only send them $10.
  So these capital gains, I like to put it in real family perspective. 
Let me bring a Janesville family in since we talked about a South 
Dakota family. They have got two kids at home and a freshman in 
college. This family, when they go to do their taxes next year, they 
subtract off $400 for each one of the kids that are still home and 
$1,500 for the college freshman. That is a total of $2,300 that they 
keep in their home, in their family, instead of sending it to 
Washington.
  I always like to ask the next question. The next question I always 
ask them is, ``So who do you suppose could spend this money better, us 
out here in Washington or you in your family in your own home?'' And 
there is just a chuckle around the room because we all know the answer 
to that question.
  Mr. GUTKNECHT. I think sometimes we have to remind ourselves, and I 
know that my colleague was back in South Dakota and was probably 
watching some of the debates when we first got into this fight about 
balancing the budget and allowing families to keep more of their own 
money while we were trying to save Medicare and a lot of the critics 
and cynics on the other side said, first of all, you cannot do it. You 
cannot balance the budget. You certainly cannot balance the budget and 
provide tax relief. And, above all, you cannot balance the budget, 
provide tax relief, and save Medicare.
  Then sometimes the cynics said, well, if you give these tax cuts it 
will only benefit the wealthy and particularly as it relates to capital 
gains. I mean, that was the argument. I am sure my colleague heard it. 
There were ads run. There was almost hysteria around this town that if 
you provide capital gains tax relief, it will not do much for the 
economy but it will help the wealthy.
  Well, we did not pay attention to the cynics. We did not pay 
attention to the critics. We had to ignore them. And, ultimately, what 
happened? Well, we are balancing the budget. We have the healthiest 
economy we have seen in 30 years, the lowest unemployment rate.
  And perhaps the best news of all, partly because of our welfare 
reform, and I know the governor in Wisconsin has probably done more 
than almost any other governor, we have done a good job in Minnesota, 
and I think they have done a good job in South Dakota as well. But 
nationally, when we passed welfare reform and sent a lot of the 
decision-making back to the States and all that we did was require 
work, personal responsibility and encourage families to stay together, 
that was welfare reform. We block granted it. We ended the Federal 
entitlement, which existed for 60 years.
  And a lot of the critics and cynics on the other side said, ``You are 
going to pull the rug out from these people. People will starve. People 
will be thrown out in the streets.''
  Well, let us look at the facts. Let us look at what has happened. 2.2 
million American families have moved off of welfare roles and onto 
payrolls.

                              {time}  1930

  I will tell the gentleman a story from my district. I was meeting 
with some teachers. After school, we talked about Title 1, and we 
talked about some educational programs.
  Finally, one of the teachers said, you know, of all of the things you 
guys have done since you went to Washington, I think the most important 
is this welfare reform. I said, really. Tell me about that.
  She said, well, let me tell you about one of my students. Let us call 
him Johnny. All of a sudden, Johnny started to behave better. He had a 
better attitude. He was a better student. He even carried himself 
better. Finally, she said, I asked Johnny, is there something different 
at your house? Johnny said, yeah, my dad got a job.
  We forget sometimes, those of us who have had at least one job since 
we were 15 years old, that a job is more than the way we earn our 
living. A job helps improve and affect our entire life, and it affects 
everybody in the family.
  Through a stronger economy, by lowering capital gains tax rates, by 
allowing families to keep more of what they earn, by encouraging work 
and personal responsibility, the great news is, not only have we saved 
money, but we have saved people. We have saved families. We have saved 
kids from one more generation of dependency and dispair.
  Mr. Speaker, I yield back to my friend from Wisconsin.
  Mr. NEUMANN. Mr. Speaker, a very exciting thing. When I was in our 
district and I toured one of the centers where they help people leave 
the welfare and get into the workforce, they did not talk to those 
families about the first job or only the first job they were going to 
get. At this work center, they talked to them about the first job and 
showed them how, if they were successful at the first job, they could 
have a second job, and how then there was a promotion waiting. They 
literally went to the fourth job for these families that were leaving 
welfare.
  If citizens stay on welfare, they are destined to receive only what 
the government decides to give them. But if

[[Page H2085]]

they go into the workforce, they have the opportunity to receive a job 
promotion and create a better life for themselves and their family. 
That is what welfare reform is all about. That is the exciting thing in 
welfare reform.
  Mr. THUNE. Mr. Speaker, if the gentleman would yield, I would also 
add, and I think, again, it is something that my colleagues all were 
responsible for doing when they came here back in 1995 to reform the 
welfare system. But it started with a principle, and that is that the 
welfare program ought not to be measured, its success ought not to be 
measured by how many people we get on welfare but how many people we 
get off. And that is a value. Hard work is a value and personal 
responsibility. That translates into a public policy which has produced 
the exact results that we thought it would.
  I think that is a great tribute to the work that my colleagues did 
when they got here. Of course, we in 1996 and 1997 and following, we 
were able to join them and continue down that road.
  I think, in many respects, if we look at the success in the economy, 
and there has been a lot of talk about who should get credit for the 
booming economy. The President says it was his budget. It was his 1993 
budget which, of course, included $250 billion in tax increases which I 
have a hard time thinking have a lot to do with an economic recovery.
  Since the Republicans took control, since this majority took over in 
1995 and we made some of the tough decisions on fiscal policy and 
getting our fiscal house in order, the markets have recognized that. We 
look at what the markets have done. But before the election in 1994, 
the DOW was at about 3800 points; today, it is over 9000.
  So to suggest for a moment that that was all a result of the 1993 tax 
increase I think begs the question. The question is: What about all the 
hard work that was done by this Congress when they came in, made those 
hard fiscal choices, which the markets recognize, interest rates 
started coming down? And the general attitude in this town, for a 
change, was, we are going to do what we can to lower the tax burden so 
people can make investments, keep more of what they earn. That 
unleashed a whole new round of investment. We are seeing the 
renaissance of a lot of that decision making.
  I think, frankly, in fairness, we need to give credit where credit is 
due. Those of us who joined this Congress back in 1995 deserve a great 
deal of credit.
  Mr. NEUMANN. Mr. Speaker, reclaiming my time, I think what the 
gentleman talks about, and I showed this chart earlier this evening, 
but when he talks about what happened, and they said the 1993 tax 
increase somehow solved this problem. This is in 1995, 2 years after 
the tax increase, where the deficit was going when we got here. This is 
the President's budget proposal in April of 1995. This is where the 
deficit was going.
  It is not the tax increase that solved the problem. It was a 
combination of a strong economy coupled with controlled Washington 
spending, getting the growth rate of Washington spending under control.
  The yellow line is our first 12 months here, the green line is what 
we hope to do, and the blue line, reaching balanced budget 4 years 
ahead of schedule, is what has actually happened.
  Mr. GUTKNECHT. Mr. Speaker, if the gentleman would yield, the truth 
of the matter is the facts speak very loudly. In fact, I often quote 
John Adams, one of the people who helped write our Constitution. He 
said, facts are stubborn things, and the facts are overwhelming. That 
is that if tax increases alone would have balanced the budget, we would 
have had a huge surplus long ago.
  As the gentleman indicated earlier, when Washington gets its hands on 
the money, the history has always been that it spends it. Not only does 
it spend it, but let me give my colleagues one more statistic that 
people forget.
  On the last 30 years, on average, for every dollar that Congress took 
in, it spent an average of $1.22. Since we took control, since the 
Republicans took control of this Congress, that number is down to a 
$1.01. I think, with this budget, it will actually be about 99 cents. 
If that is not a clear-cut difference, I do not know what is.
  Mr. NEUMANN. Mr. Speaker, reclaiming my time, I think the other thing 
that needs to be kept in mind here, from 1969 to today, we have had 
other strong economies but never got a balanced budget. Lord only 
knows, we have had more than enough tax increases between 1969 and 
today. That is how we have got the high tax rates we have got today.
  Neither the tax increases nor the strong economy, by themselves, have 
led us to a balanced budget. It has been the controlling of Washington 
spending coupled with that.
  We talked about some solutions here like welfare and getting us to a 
balanced budget. I want to drop back to Social Security for a minute 
because, long term, we still have this Social Security problem that, 
even if we get the money in the Social Security Trust Fund by passing 
the Social Security Preservation Act, in the year 2029, they still run 
out of money. The Social Security Preservation Act solves it from 2012 
to 2029.
  I would like to, just for a minute, focus on some of the discussion 
that is going on here. I found when I was talking to the American 
people and I said Democrat Senator Patrick Moynihan has a plan on the 
table, everybody knew who Democratic Senator Patrick Moynihan was. They 
had very little knowledge of what his plan was, other than he was a 
person who usually worked with seniors.
  I think it is important, and let me be very specific about this, I do 
not support this plan, but I think it is important the American people 
understand what it is that Democrat Senator Patrick Moynihan is 
proposing, because it is the number one plan in terms of solves Social 
Security. It goes back to the old ways.
  Here is what it does. It first lowers the cost of living adjustments 
to senior citizens by 1 percent. I found all our seniors in our town 
hall meeting knew what the cost of living adjustments were. The plan 
lowers cost of living adjustments by 1 percent.

  It increases the retirement age from 67 to 70. It raises the taxes on 
Social Security benefits. And here is how he does this in the plan. He 
looks at how much is paid into Social Security over the years. Anything 
we get out over and above that amount is 100 percent taxable.
  So it is a monumental tax increase on our seniors. It lowers the 
benefits being paid to our seniors up front by recomputing the number 
of years from which we base our initial payment.
  The part that he is getting a lot of support for, and even some of my 
conservative friends are supporting him, because it takes the 12.4 
percent Social Security tax that is being paid today and it lowers it 
to 10.4. That is where the support is coming from.
  A lot of people are seeing that reduction from 12.4 to 10.4 as 
something that is good. His idea is that, if people get that extra 2 
percent in their pocket, they can put it away and take care of 
themselves in their own retirement.
  That sounds very good, but we need to understand that, if that 
happens, we no longer have solvency past the year 2012, and the system 
is now bankrupt in the year 2012. So I do not support this plan. But I 
think it is important that the American people have the opportunity to 
understand what is in the plan.
  I would like to give my colleagues some modern thinking. This new 
Congress that has come out here and solved Medicare without raising the 
taxes by looking at things like diabetes and realizing that it was much 
cheaper and much better for our senior citizens to provide preventive 
care than it was to wait until a senior citizen got very sick because 
of diabetes, solving Medicare problems with common sense solutions that 
did not just throw money at the problem.
  There is a proposal out here right now, and I am not 100 percent 
ready to say I support it, but let me just go through the proposal 
because it is so different than anything else that has been talked 
about in terms of solving the Social Security problem.
  Here is what the proposal does. It says, first, we are going to set 
aside the money that is coming in for Social Security today. So we take 
that extra money that is coming in, we put it in a savings account. We 
solve the short-term problem in Social Security immediately by putting 
that money away.
  We then look at surpluses over and above that amount of money for 
Social

[[Page H2086]]

Security. So Social Security goes on just exactly as it is today. We 
look at surpluses above that amount that is coming in. We take those 
surpluses, and we take part of the surplus, and we give it to each 
American over the age of 18.
  Every American is getting their share of it over the age of 18, 
seniors and nonseniors. The catch here is that, if they are under 65, 
they get their share of the surplus in the form of a check to a 401(k) 
type savings account. The only stipulation, it is their money, they 
decide where they invest it, they can put it in a stock or bond or 
mutual fund or CD, where they invest it is their decision, but the only 
stipulation is they cannot take the money out until they reach age 65.
  So we look at the surpluses over and above Social Security. We divide 
a part of those surpluses amongst all Americans over the age of 18. If 
citizens are under 65, they get a check. The check goes to their 401(k) 
plan. The only stipulation is they cannot take the money out until they 
retire.
  What if they are over 65? If they are over 65, they simply get their 
share of the surplus in the form of a check. Because, of course, if 
they are over 65, it would not make sense to set up this 401(k).
  Even though it is completely separate from Social Security, here is 
how that helped solved the long-term Social Security problems. For 
seniors today or for younger people when they reach 65 and start 
drawing on this account, half of whatever they get counts back against 
what they would have gotten in Social Security, and the other half is 
simply theirs to keep.
  Again, the idea here is we look at surpluses over and above the 
Social Security surplus. We divide it up amongst the American people.
  I talked to my brother about this, and he says, you know, Mark, my 
company is doing really well. We have a pension and profit-sharing 
plan. This is sort of like America is doing real well right now. If 
America is doing real well, I mentioned before, that within 3 or 4 
years even, setting Social Security aside, we could look at surpluses 
of $150 billion.
  Let me translate that. $150 billion is roughly $600 for every person 
over the age of 18. So that $600 check, or part of that check, 
depending on how much we allocate to Social Security, would simply go 
into that 401(k) plan on behalf of everybody under the age of 16 or 
directly to the senior citizens for those that are over 65.
  Again, half of whatever they get, either when they start drawing it 
at 65 or half of that check that they are getting today if they are 
over 65, counts back to that Social Security. That is how we solve the 
long-term Social Security problems.
  When we look at that next to the idea of cutting the cost of living 
adjustment or raising taxes on seniors, these ideas are common-sense, 
straightforward, business-sector solutions to a very difficult problem. 
It is done without raising taxes on the American people.
  Mr. THUNE. Mr. Speaker, if the gentleman would yield, I did a lot of 
talking about that very proposal just to get a feedback and reaction 
from the people of South Dakota as to what they thought about that. 
Because, as the gentleman noted, we have to do something to address 
this very serious problem in the years as we get down the road. Today, 
obviously, the gentleman has laid out a plan which would protect us, 
but, ultimately, we have to do something that is consistent with a 
couple of principles which he mentioned.
  First of all, we have to save this system. There are so many people. 
In my State of South Dakota, for example, we have an elderly population 
very dependent upon it. And to make the basic statement that they will 
be protected, the safety net is there, they will continue to receive 
Social Security benefits as they are today and then even perhaps, in 
addition to that, with respect to whatever the surplus check might be, 
but that we do not touch that aspect of it.
  But what we allow is we say the surplus that comes into Washington, 
rather than allowing Washington to spend it, because, once it comes in 
here, as we mentioned earlier, somehow Washington will find a way to 
spend it, that the only way that is consistent with our values, and 
that is allowing more people in this country to keep more of what they 
earn, to make decisions about their future, to put it in a retirement 
account, a Social Security plus account that will accumulate, get the 
benefit of compound interest, and, over time, we would dramatically 
increase the amount of retirement income that people who are paying in 
today would receive.
  Again, I think, ultimately, that is something that merits serious 
consideration. The gentleman said it is a poposal. It is something that 
has been laid out there. But when we compare it with the alternative, 
the Democrat alternative, which is a tax increase on seniors, clearly 
this is something which not only protects people who are currently on 
the program but allows us to harness the surplus dollars that are going 
to come in and put them to work for the people of this country.

  Mr. NEUMANN. Mr. Speaker, there are two other benefits that I would 
like to point out in this plan.
  If there is a 20-year-old today and he started putting money into 
this plan and his account grew and at age 45, for whatever reason, 
something happened, he is married, he has got a couple kids, and he 
dies, whatever money is in that account is passed on to his spouse or 
his kids. It is his money. It does not go anywhere else. It is his 
money. It would literally be passed on to his spouse.
  The other wonderful thing in this plan, as far as I can see, is that 
it makes each and every American citizen tied into helping us control 
Washington spending. Because, as both of my colleagues have mentioned, 
if this spending goes back out of control like it was when we got here, 
there are not going to be any surplusses.
  The key here is keeping that spending under control. If every 
American citizen is getting a piece of that surplus, like my brother 
says, pension and profit sharing, if every American citizen is tied 
into that surplus, we will quickly get their support to help us keep 
Washington spending under control.
  To me, that is what government should be all about. It should be all 
about the American people being actively involved in the decisions we 
make. They will provide the impetus necessary for us to keep this 
spending under control.

                              {time}  1945

  Mr. GUTKNECHT. I really think that for many years we labored under 
some unwritten law, if you will, that no good deed goes unpunished. If 
you worked you were punished, if you saved you were punished, if you 
invested you were punished, if you grew a business and hired people, 
you were punished.
  In fact, even in the Medicare system those areas, regions of the 
country, and I think we all come from areas where we have had 
relatively low health care costs, as a result, in terms of the Medicare 
reimbursement schedule we were punished. And that was really the 
unwritten rule of Washington, and what we are trying to do is change 
that and try to reverse some of those perverse incentives.
  And if we do that I think that long term, and as you say, if we can 
come up with a Medicare system and a Social Security system which uses 
market principles and the doctrine of enlightened self-interest to get 
more people to feel as if they are stakeholders in the system, in the 
long run we will have a better system which provides more value to 
consumers or to Social Security people, recipients of Medicare 
treatments, whatever. And that is what we are really trying to do, is 
reverse those age-old perverse incentives which have been created here 
in Washington.
  Mr. NEUMANN. I think at this point if we could, we have been talking 
a lot about these economic problems and the solutions, and I think we 
have hit on the three economic problems facing America.
  We must restore the Social Security system. Our seniors have a right 
to get up in the morning knowing their Social Security is safe.
  We need to pay down the Federal debt. Our children deserve to inherit 
a debt free Nation and reduce the tax burden on American workers.
  I would like to jump over to the social side for just a minute, and I 
would like to talk about a couple issues over on the social side and I 
would like to start with education, because we recently received a 
report that tells us

[[Page H2087]]

that our kids are number 21 in the world in education. And I want to 
talk about a vision for our Nation's future that does not bring us back 
to the top 10, I want to talk about a vision for America that brings 
our kids back to number 1 in the world, and I think that should be our 
target. Not back into the top 10 in the world; I want our kids to be 
the best educated kids in the entire world, and that should be our 
goal.
  But you know where we get into conflict here, and we are hearing this 
in the news today, we get into this conflict that somehow the right way 
to get education problems solved is for Washington to come running into 
the picture and Washington to develop new spending programs. Washington 
is going to hire new teachers and Washington is going to build new 
schools.
  What that means is Washington is taking control of the education 
system, and I think that is exactly what has led us to number 21 in the 
world. If we want to turn the education system around, the right answer 
is to get the parents back involved in the education process of their 
kids.
  Parents should be choosing where their kids are going to school, what 
their kids are learning and how it is going to be taught. If we really 
want to solve the education problems facing the United States of 
America, we need to re-empower our parents to be actively involved in 
where the kids go to school, what they are taught and how it is taught.
  There is a side benefit, and this came out in a study that was 
recently published out here. They looked at 12,000 teenagers across 
America, this was in the Washington Times, I believe it was April 10, 
but they looked at 12,000 teenagers across America. And as you might 
expect, if you look at 12,000 teenagers you find some with crime, you 
got drug problems, you got teen pregnancy, you got teen smoking, you 
got all the social problems that we hear about Washington trying to 
solve.
  But when they looked at this study of 12,000 teenagers and they 
looked at crime, they found the number one predictor of whether a 
student or a teenager was going to be involved in crime was parental 
involvement with the child. They found the number one predictor of 
whether a student was going to be involved in drugs was the parental 
involvement in that teenager's life. Teen pregnancy, same thing. The 
number one predictor of whether or not a teenager was going to be 
involved with teen pregnancy: parental involvement and the like. Teen 
smoking, same thing.
  So when you really look at this and when we think about these 
concepts that we are talking about here tonight, getting education back 
up to number one in the world, how do you do that? You get the parents 
back involved in the decision-making process in education. The outcome 
will solve a lot of other problems that Washington thinks the right 
answer is throwing money at. The right answer is not throwing money at 
it; the right answer is getting parents back involved in the lives of 
the kids.
  And I do not think Washington should mandate that parents have to 
spend 2 hours a day with their kids, although it might not be a bad 
idea. That is not what I think we should do. But what I do think we 
should do is relate this to the other side of this discussion we have 
had.
  When the tax rate went from $25 out of every $100 that people earned 
to $37 out of every $100 people earned, that meant in many cases the 
parent was going to be forced to take a second and even a third job, 
and when the parents are working at that second and third job, that 
means that when they get home they are either too tired or there is no 
time to spend with those kids. So when we talk about reducing the tax 
rate on American workers, what we are really talking about here is 
getting it back to a point where the families do not have to take that 
second job, so at least we empower the parents to have the opportunity 
to be more actively involved with their teenagers so that those 
teenagers are less likely to be involved in drugs, crimes, teen 
pregnancy, teen smoking, lots of the other social ills facing America.
  That is how this whole vision for America ties together. If we can 
get the tax rate down, empower the parents to at least have the 
opportunity to make the decision to get back in their kids' lives, we 
will see a lot of other solutions.
  I want to give a very specific example, and this is a case I am very 
familiar with. It is good friends of ours. Christmas time comes in this 
family, and they are a middle income family, it is a true story. They 
live from paycheck to paycheck, but they are a middle income family. 
When Christmas comes, the mother in the house takes a second job. You 
know why she takes a second job? Because that is how they pay for their 
Christmas presents.
  Now just think about a different picture for a minute. Instead of 
this mother leaving her home and leaving her family at this most 
important time of the year, instead of doing that, if we could bring 
this tax rate down so they could just keep that extra $12 out of every 
hundred they earn in their home in the first place, that mother does 
not have to take that job. It is a second job in this case. She does 
not have to take the second job, and when she does not take the second 
job, she has more time available to spend with the kids.
  More time available with the kids on the part of a parent is the 
single most important factor in determining whether we will have crime 
problems, drug problems, teen pregnancy, teen smoking, all of these 
things that we here in Washington somehow think that we here in 
Washington can solve. It is baloney. The way to solve these problems is 
get the parents and empower the parents to be actively involved in 
their kids' lives. It is the most important thing that we can do, and 
it is how the economic discussion ties directly into the social 
problems facing America today.
  Mr. THUNE. If the gentleman will yield on that, you made one comment 
there which I think is really very much on the mark. You know our 
children need a learning environment that is safe and drug-free, and we 
are losing the war on drugs in America today, and we are not seeing 
leadership in trying to snuff that out. And we need to have leadership 
at the presidential level, at the congressional level, at the community 
level, at the schools, in the families and the churches to address what 
has become a very, very serious issue.
  And again a case in point in my home State of South Dakota, and we 
have often thought that we are somewhat immune from a lot of these 
problems that you see in bigger cities. But the fact of the matter is 
that a lot of the small communities across South Dakota are having to 
come to grips with the fact that drugs are not only accessible, they 
are readily available, and that kids are regularly using them.
  And there is a small town for which just recently the survey was done 
and of the high school kids, 28 percent, almost a third, said they used 
drugs more than 4 times a month. That is a staggering statistic in 
South Dakota and certainly across this Nation. We have a very serious 
problem that we need to eradicate.
  And frankly again it is not going to be, I do not think necessarily a 
bill that we pass, but it is going to take leadership that we all have 
to be a part of in community antidrug coalitions and school-based 
programs and really going after this in the same way that we have 
common enemies in the past. Because in my view it is a very, very 
serious insidious threat to the future of our country, to the future of 
or young people, and something that we are not attacking head-on and we 
need to, and it starts at the top.
  Mr. NEUMANN. Reclaiming my time, and I would just go back to this 
survey, and I would keep going back to what the survey found: The 
single most important determining factor in whether or not a teenager 
is going to be involved with drugs is the involvement of the parent in 
the teenager's life. The right answers to these problems are empowering 
our parents. That is our role. Get us out of their way so they are not 
sending all their money out here in taxes, they do not have to take 
that second job; get out of the way so the parents can spend more time 
with their kids.
  And, I mean, I am not naive enough to think that all of a sudden we 
lower taxes, parents spend more time with kids and all the problems go 
away. I mean, I am not that naive. But when you start looking at how 
you actually go about turning around a Nation that has been headed in 
the wrong direction, certainly parental involvement in the kids' lives 
ought to be our top priority.

[[Page H2088]]

  And one more thing on this social side that I think is very 
important. Five years ago we did not even know about this topic, but we 
know as a Nation about it today. It is partial-birth abortions. And if 
you start looking at America and where we are today and where we are 
going to, if we turn our back on this issue, I do not see how we can 
solve the rest of the social issues facing our Nation.
  A partial-birth abortion is a third trimester, seventh, eighth or 
ninth month abortion where the baby is literally partially delivered 
and then at the last second the baby is killed. I just do not 
understand how we as a Nation can go on allowing this to happen now 
that we know about it. Frankly, when I was elected I did not know what 
it was, but I know now. And when you start looking at these social ills 
facing America, I think we have to accept that that is part of the 
problem facing our country, and I think we need to end it.
  I have got about a minute and a half left, and I would just like to 
kind of sum up this kind of vision for where we are going to. If you 
like, a Republican vision for the future of this great Nation that we 
live in. How are we going to go about restoring this Nation?
  Let me go through on the economic side first very quickly. Restore 
the Social Security system so our seniors can get up in the morning 
knowing their Social Security is safe. I think every senior is entitled 
to that. The debt. Our children deserve a debt-free Nation, so let us 
start making payments on the debt much like you would repay a home 
mortgage. Taxes are too high on our families all across America, so let 
us get that tax rate back down from $37 dollars out of every $100, at 
least down to $25 out of every $100 that American workers work so hard 
to earn.
  On the social side, let us get education, let us make that our top 
priority. Let us get education back up to number one in the world, and 
do this by involving the parents and giving parents the opportunity to 
choose where their kids go to school, what it is they are taught and 
how they are taught it. And when the parents get involved in the kids' 
lives, making those decisions about education, the automatic outcome is 
that extra parental involvement in the kid's life, that leads to lower 
crime rates, fewer drug problems, fewer teen pregnancies and less teen 
smoking.
  This is the right direction to move America, and while we are done 
with this, let us make sure we end partial-birth abortions. And let us 
then pass this vision on to the next generation and this great Nation 
we live in.
  Mr. GUTKNECHT. If the gentleman will yield, finally what you are 
really saying is what Vaclav Havel, the first freely elected Prime 
Minister of Czechoslovakia, said shortly after he was elected. He said 
in the end all politics is moral.
  Balancing the budget, saving Medicare, saving Social Security and 
stopping partial-birth abortions in many respects are all about 
regaining some of that high moral ground, and if you ask Americans what 
is really wrong in this country, they will many times say it is the 
unraveling of the moral fabric of this country. And so all of the 
things we have talked about tonight really, at the end of the day, are 
about morality.

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