[Congressional Record Volume 144, Number 61 (Thursday, May 14, 1998)]
[House]
[Pages H3302-H3307]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               CUTTING THE GROWTH OF WASHINGTON SPENDING

  Mr. SPEAKER pro tempore (Mr. McKeon). Under the Speaker's announced 
policy of January 7, 1997, the gentleman from Minnesota (Mr. Gutknecht) 
is recognized for the balance of the time of the gentleman from 
Wisconsin (Mr. Neumann).
  Mr. GUTKNECHT. Mr. Speaker, as the gentleman from Wisconsin (Mr. 
Neumann) runs out the door, I want to say a special congratulations and 
thanks to my colleague.
  I remember a couple of years ago when we first started having some 
joint town hall meetings. I represent Minnesota, he represents 
Wisconsin. When we first started talking about actually balancing the 
budget, and more importantly, even paying down some of the $5.4 
trillion worth of debt that we have run up, that this Congress in the 
past, at least, has run up on our kids, a lot of people thought we were 
both crazy. We said that we believed we could balance the budget not 
just in 7 years, that it could actually be done in much less time.
  As a matter of fact, the gentleman from Wisconsin (Mr. Neumann) came 
over to my district last year, we had a couple of joint appearances, 
and then we both predicted that there was a very good chance we would 
not only balance the budget this year, but there

[[Page H3303]]

is a very good chance we would have a surplus this year.
  How has that happened, I know many of our colleagues and folks ask 
who have been watching this discussion here in this special order this 
afternoon. It is important, sometimes, to go back to where we were. The 
charts the gentleman from Wisconsin (Mr. Neumann) was showing a few 
minutes ago showed what was happening for the last 30 years.
  I had my staff do a little analysis. For the last 30 years, prior to 
the 1994 elections, for every dollar Washington took in it spent an 
average of $1.22. That was the pattern for every year. They could raise 
taxes, sometimes they would cut taxes, but the problem was spending.
  In fact, a farmer in my district perhaps put it better than anybody 
else when we were talking one afternoon out on his farm. He said to me, 
the problem is not that we do not send enough money in to Washington. 
The problem is that Washington spends it faster than we can send it in. 
He was exactly right. That is what had been happening for the last 30 
years.
  For the first time in 1995, with the leadership of the gentleman from 
Ohio (Mr. John Kasich) and the Committee on the Budget, they came out 
with a plan to dramatically change the way Washington does business. In 
the process, we have eliminated 300 different programs here at the 
Federal level; some of them big ones that people have heard of, like 
the Interstate Commerce Commission, and many small ones. But the point 
is, we began to change the whole tenor, the whole debate, the whole 
discussion, and the whole principles that were at stake here in 
Washington began to change.
  In the process, we have reduced the rate of growth in Federal 
spending. Now, some people said we were making draconian cuts, that 
kids would lose their school lunches, all of these terrible things 
would happen to our senior citizens.
  Most of that was hyperbole and is not true, but it is true that this 
Congress has dramatically reduced the rate of growth in Federal 
spending. As a matter of fact, we have cut the rate of growth in 
Federal spending almost in half.
  When we combine that with a much stronger than expected economy, and 
I must say, again, that my colleague, the gentleman from Wisconsin, as 
a former entrepreneur and businessperson himself, understood that if 
there were some signals going out both to Wall Street and to Main 
Street, that for the first time in 30 years Congress was serious about 
reducing that $1.22 of spending for every dollar it takes in; that that 
message would be translated into the lower interest rates that folks on 
Wall Street and folks on Main Street would understand, that for the 
first time Congress was serious about controlling Federal spending. The 
net has been that the economy has been much stronger than even some of 
the most optimistic prognosticators told us a few years ago.

  So when we combine a much stronger economy with real restraint in 
Federal spending, what we see today for the first time since I was in 
high school is not only a budget that is going to be in balance, but 
more important than that, a budget which will probably produce a 
significant surplus, we believe somewhere in the area of $80 billion 
this year, and also has a very good chance of producing surpluses in 
the $80 to $100 billion range every year for a number of years to come.
  That is where we were back throughout the sixties, the seventies, the 
eighties. For every dollar that Washington took in, it spent $1.21. Now 
that number is actually 99 cents. For every dollar Washington will take 
in this year, we will spend 99 cents.
  We still have a lot of problems. One of them is Social Security. I 
know the gentleman from Wisconsin (Mr. Neumann) has talked a lot about 
this. I am not certain if he got a chance to talk about it earlier. We 
do have a significant problem with Social Security. It really is 
generational.
  I think we need to talk about generational fairness, when we talk 
about Social Security. Most of us have parents, and I am fortunate that 
both my parents are still living. They are both on Medicare, both on 
Social Security. Obviously, the last thing we want to do is pull the 
rug out from under them.
  I happen to represent the baby boomers. I was born in 1951. We once 
had a demographer tell us there were more babies born in 1951 than any 
other year. We are the peak of the baby boomers. I understand the 
consequences to the Social Security trust fund when the baby boomers 
begin to retire in about the year 2010.
  I also have three children, and I want to make certain that we do not 
do things with our generation that would make it impossible for the 
next generation to enjoy anywhere near the standard of living that we 
have enjoyed. So we really have three separate generations we have to 
deal with with Social Security.
  When we talk about Social Security, and one of the things as it 
relates to the budget, currently we are taking in about $100 billion a 
year more than we are spending on Social Security. We should have a 
trust fund, there is a trust fund, but what happens is the money comes 
into the trust fund and then is loaned back to the Federal Government. 
In the process, it disguises the size of the debt. That started back in 
about 1964.
  Some of us would argue that it was a mistake to go to the unified 
budget and use the surpluses in Social Security to make the budget 
deficit look smaller. But that is the way it is, that is the way it has 
been. I think at some point in the future, hopefully in the near 
future, we will begin to change that entire budget process so we have 
an honest and fair budget accounting.
  So even though we will show a surplus this year technically, we will 
still be borrowing about $100 billion this year from the Social 
Security trust fund. We have to solve that and at least be aware of 
that.
  I want to say a special congratulations to the gentleman from Ohio 
(Mr. John Kasich). No one has fought harder in this Congress over the 
last 5 or 6 years to balance the Federal budget to get control of the 
Federal spending that that farmer talked about than the gentleman from 
Ohio (Mr. Kasich).
  I also want to congratulate him, because as a member of the Committee 
on the Budget, we have been working long and hard over the last several 
months trying to come up with a budget plan, number one, which will 
advance the values that I think most Americans have and want. That is, 
they want us to pay down some of that national debt, they want to save 
Social Security, they would like to shrink the size of the Federal 
Government to allow for additional tax relief.
  That is exactly what the gentleman from Ohio (Mr. Kasich) and the 
Republican members of the Committee on the Budget have been working on, 
and within the next week or 10 days we are going to be unveiling that 
plan, hopefully have it here on the House floor. Essentially what the 
gentleman from Ohio (Mr. Kasich) and the Committee on the Budget are 
talking about is restricting the rate of growth in Federal spending 
over the next 5 years to the inflation rate.
  I know when that budget hits the floor there are going to be people 
who are going to say, oh, my goodness, you cannot restrict the rate of 
growth in Federal spending to the inflation rate. But ultimately they 
are going to have to ask themselves this question. They are going to 
have to choose between family budgets and the Federal budget; why is it 
more important that the Federal budget grow at greater than the 
inflation rate when many family budgets are not?
  If we can do that, if we can exercise even that fiscal discipline to 
find an additional $100 billion, this does require some cuts in terms 
of what people had expected to spend in some of these programs. But 
generally speaking, as I say, we are going to allow Federal spending to 
grow at approximately the rate of inflation over the next 5 years.
  In doing so, we will generate significant surpluses in our opinion, 
and more important, we will make room for significant tax relief. The 
tax I want to talk about that we hope that we will include in the final 
budget resolution, at least as a recommendation to our colleagues here 
in the House, will be for the marriage penalty tax.
  I believe my numbers are correct. There are approximately 12 million 
American families who pay a tax penalty for the privilege or the right 
or

[[Page H3304]]

the blessing, if you will, of being married.
  I like to tell the story that in less than a month my wife and I will 
celebrate our 26th wedding anniversary. I steal this story from Senator 
Phil Gramm over in the Senate side, one of our colleagues over there, 
who says he has been married a long time. He believes his wife still 
loves him, but says, I wish the IRS would stop tempting my wife to 
leave me.
  It is almost unconscionable, and frankly, I think it is almost 
immoral that the Federal Government charges married couples a higher 
tax rate, so that approximately 12 million American families pay a tax 
penalty of almost $2,000 per family for being married. We ought to 
encourage stronger marriages, not discourage them.
  Here in Washington one of my favorite expressions, and altogether too 
often it is true, is that no good deed goes unpunished. In other words, 
if you work, you get punished; if you save, you get punished; if you 
create jobs, you get punished. That is the kind of thinking that really 
has occupied Washington for too long. What we are saying is that it is 
time to reverse some of those perverse incentives. Clearly the marriage 
penalty tax is one of those.
  Our estimates are that to get rid of the marriage penalty tax, it 
would take about $100 billion over the next 5 years, which, 
coincidentally, if we limit the growth in Federal spending to the 
inflation rate over the next 5 years, frees up enough money to make 
that tax penalty go away.

                              {time}  1545

  I think that is a good idea. I think that is an idea that once the 
American people have a chance to evaluate that, to understand it, I 
think they will agree that it is time to end the marriage penalty tax 
and, if we can make the Federal Government go on just a slight diet 
over the next five years and, to put this in context, over the next 
five years it is estimated that the Federal Government will spend about 
$9 trillion, that is with a ``T'' now, $9 trillion, that is how much we 
are expected to spend under the budget agreement that we set with the 
President last August 5.
  What the Committee on the Budget is going to ask all Members of 
Congress to do is to tighten the Federal budget by $100 billion. To put 
that in some kind of a context that perhaps we can understand better, 
let us assume the Federal Government has a belt that is 9 feet around, 
in other words, the waste, the girth of the Federal budget is 9 feet or 
$9 trillion. What we are going to ask our colleagues to do is find a 
way to pull that belt in one inch. We are going to pull that belt in 
one notch.
  If we can do that, we can eliminate the marriage penalty tax, we can 
create greater surpluses to make Social Security more solvent. We can 
begin to pay down the debt and ultimately, by sticking to a very simple 
formula of limiting the growth of the Federal budget to approximately 
the inflation rate, we can provide additional funds for tax relief. We 
can make Social Security solvent. But here is the best news of all, we 
can pay off the national debt. We can pay off the national debt in 
approximately 21 years. That may seem simple and it may seem almost too 
hard to believe, but we have run the numbers and they are accurate.
  Now, I talked earlier about the generational fairness and being fair 
to our senior citizens. Certainly we do not want to pull the rug out 
from under them as it relates to Medicare or Social Security. We also 
understand what the baby boom generation is going to mean in terms of 
its retirement, what is going to happen when we begin to draw on those 
Medicare benefits. What we really want to do, though, is preserve the 
American dream for future generations. I cannot think of anything 
better to leave our kids than a debt free future.
  I think if the American people have a chance to think about this, I 
think they are going to agree that the time has come to dream big 
dreams. There was an architect from Chicago who said, make no small 
plans. The American people have always made big plans. We are a people 
of big dreams.
  In fact, Winston Churchill once observed, when he was talking about 
the American people, he said, you did not cross the oceans, fjord the 
streams, traverse the streams and deal with the droughts and pestilence 
because you were made of sugar candy. The American people are a tough 
people. They believe in big dreams. They believe in paying down the 
debt.
  Out where I come from in farm country, it is almost the American 
dream to pay off the mortgage and leave our kids the farm. It is 
unfortunate, if you stop and think about it, what we have been doing 
here in the United States, particularly here in Washington over the 
last 30 or 40 years. They literally have been selling off the farm and 
leaving our kids the mortgage. That is worse than just bad politics. It 
is worse than just bad economics. It is fundamentally immoral.
  So what we are saying is, if Washington can find a way, if we in 
Congress can take that 9-foot-long belt and if we can pull it in just 
one notch, one inch, we cannot only balance the budget, we can actually 
begin to pay down the national debt, and we can make room for tax 
relief for working families. We can make it easier so that they can 
take care of their kids and their families by eliminating the marriage 
penalty tax. That is a big dream. That is a big goal. But Americans 
love big dreams and big goals, and I think that this Congress is up to 
that task.
  I think we can get it done. It is going to take the help of the 
American people. I think we have to help. We have to explain it to the 
American people so that they understand these are not draconian cuts we 
are going to be talking about. We are actually talking about limiting 
the growth in Federal spending over the next five years to the expected 
inflation rate. It can be done. In fact, if you compare what we are 
talking about to what has happened in corporate America over the last 5 
years, these are very modest decisions that we are making today. And 
the budget proposal that we will bring to the floor of the House here 
in the next week or 10 days is incredibly modest and some might even 
say timid. But if you begin to make the right decisions, as we did 3 
years ago, in terms of balancing the budget, limiting the growth in 
Federal spending, eliminating 300 different programs, taking other 
programs and figuring out ways to make them run more efficiently, 
ultimately there are big dividends for the American people and 
ultimately for the next generation of Americans.
  I want to congratulate the gentleman from Wisconsin (Mr. Neumann) and 
the gentleman from Ohio (Mr. Kasich), members of the Committee on the 
Budget. We have come a long way. We have made tremendous progress in 
terms of balancing the budget, reforming welfare, saving Medicare. We 
still have a lot to do. We have got to make Social Security not only 
solvent for our parents and for the baby boomers, but we need to create 
an entirely new retirement system for the younger generation.
  Among those options that we are looking at, and I think deserve very 
serious consideration, is the notion of personalized retirement 
accounts. Perhaps we can use some of those budget surpluses to make 
every American stakeholders in a brighter future and in their own 
retirement system using personalized retirement accounts. For example, 
if we have a $50 billion surplus and we divide it up among 
approximately 100 million taxpayers, we could put $500 in everybody's 
personalized retirement account. That is every American who pays taxes. 
And they could also contribute to that for themselves. Ultimately this 
becomes a profit sharing plan for the surplus. It encourages all 
Americans to take an active role in their government, to make certain 
that we do not have wasteful spending and that we keep control of 
Federal spending so that ultimately we have larger and larger 
surpluses, which then, portions of which could be distributed back to 
the American people through these personalized retirement accounts.
  It is an idea whose time is coming, and we are going to have some 
interesting debate and discussion on that. I think ultimately a growing 
consensus will agree that that is one way that you can save the next 
generation in terms of their own retirement. So, as I say, we have made 
enormous progress. I am very pleased with the work we have done. I 
think if you consider where we were few years ago, it is

[[Page H3305]]

amazing to look now at the American people and say, yes, we have a 
balanced budget, at least using the accounting terms that we have had 
since 1964.
  There is much more to be done though. We have to save Social 
Security. We have to further strengthen Medicare. We have to create 
personalized retirement accounts for young people, and we have to 
create a system and almost an ethic here in Washington that makes it 
sure that we do not have deficits anymore, that we are always working 
trying to figure out ways to guarantee that we have surpluses. That 
will guarantee lower interest rates so that more Americans can afford 
homes and cars. It ensures a stronger economy so that more people who 
perhaps were on welfare, who were on those welfare rolls can move on to 
payrolls. That is really the goal, and so we can all have a brighter 
future and a better future for the next generation of Americans.
  I want to thank the gentleman from Wisconsin (Mr. Neumann) for 
yielding me the time. I see my friend from South Dakota (Mr. Thune) has 
joined us.
  I yield to the gentleman from South Dakota (Mr. Thune).
  Mr. THUNE. I thank my good friend from Minnesota for yielding to me.
  I appreciate the discussion that has been held on the floor this 
afternoon between he and our colleague, the gentleman from Wisconsin 
(Mr. Neumann) who has been a leader and at the forefront of addressing 
the Federal spending, the proclivity in this town to continue to spend 
more than we take in, has been very bold, I think, in the efforts that 
he has made to try and bring that spending under control and coming up 
with some solutions that in a very deliberate and systematic way 
address the long-term problems facing our country with respect to 
government spending and, in fact, most recently has begun discussion of 
this budget year, what we might do to slow the growth rate of Federal 
spending, rather than seeing it grow as it does and under the 
President's budget at twice the rate of inflation and even under the 
Senate-passed budget at 1\1/2\ times the rate of inflation, to getting 
it back to the rate of inflation.

  If we can get to where we are controlling government spending in that 
fashion, I think we will see over time the revenue situation improve to 
where we not only can address the ongoing needs of government but 
furthermore address the long-term challenges that face our country, one 
of which is reestablishing the trust fund, the Social Security trust 
fund, which is going to provide for our retirement needs in the future 
and doing it in a way, again, that not only secures and ensures that 
those who are currently receiving benefits continue to receive benefits 
but also for future generations, that we do something to address the 
fact that the program, unless we make some changes and unless we do 
something to make sure the trust fund is in fact secure, that the 
dollars are not going to be there to pay out.
  Finally, to give back to the American people a little bit more of 
what they earn. I think that the budget that the gentleman from 
Wisconsin has been working on, and you and others, starts moving us in 
that direction. I wanted to credit you with the work that is under way 
to address, again, the long-term problem in this country; that is, that 
Washington has a tendency, if there are any dollars around, they are 
going to get spent. We want to make sure that the American people are 
getting a good return on their taxes.
  Furthermore, as we look down the road at what we can do to deliver 
tax relief and to give people in this country a little bit more, allow 
them to keep more of what they earn and make their budgets bigger and 
the Federal budget smaller, some systematic approaches toward tax 
relief and reform, ultimately, which I think should be our long-term 
goal, but at this point in time looking at how we best deliver tax 
relief to people in this country.
  I know that there are a number of alternatives out there, one of 
which is eliminating the marriage penalty which I support because it is 
a very punitive thing directed at people who get married in this 
country. It is something that I think we all agree that we ought not 
penalize through the tax code as a matter of practice people for 
getting married. It is something we want to encourage, not only to get 
married but to stay married. I think that is something we all support.
  There is another piece of legislation that I would like to mention, 
which I know is part of the cap proposal which is out there right now, 
that addresses this whole notion of allowing more people to pay at the 
lower 15 percent tax rate level as opposed to the higher 28 percent 
level. And this, if we can somehow raise the threshold at which the 28 
percent rate kicks in, we will have more and more people paying more of 
their income or having more of their income covered at the lower 15 
percent rate, therefore, paying less in taxes and having an incentive 
to go out and to do better and to improve their lot in life and to earn 
more, because we are not going to be taking 28 cents out of every 
dollar they earn. We are only going to be taking 15 cents, doing that 
in a way that delivers tax relief in a very broad based way so that 
anybody in this country, irrespective of their status, married or 
single or with children, that we get away from the Washington knows 
best way of directing tax relief to specific groups and targeting and, 
again, bring tax relief in a broad-based way that says to the American 
taxpayer, if you pay taxes, you deserve tax relief.
  I think that ought to be one of the principles that we incorporate 
and one of the values that we try to advance as this debate over 
budgets begins in this budget year.
  Mr. GUTKNECHT. I appreciate the gentleman. And the whole issue of 
taxes, I know this sometimes drives some of our more liberal colleagues 
into orbit when you talk about tax relief, allowing people to keep more 
of their own money. Sometimes we have to look at that from an 
historical perspective as well.
  Back when I was growing up, my parents were able to raise 3 boys on 
one paycheck. The reason they could do that is the average family sent 
only about 4 percent of their gross income to the Federal Government in 
the form of taxes. Today the average family, when you put total taxes, 
now we are talking State, Federal and local taxes, altogether, the 
average family spends over 38 percent of their gross income on taxes.
  I think most Americans are shocked when they learn that the average 
family spends more on taxes than they do on food, clothing and shelter 
combined. And that is why so many parents, now both parents have to 
work and, frankly, that has caused some social problems.
  Mr. Neumann also has an excellent presentation when he talks about 
you can almost predict which kids are going to get involved in drugs, 
which kids are going to get involved in smoking cigarettes. It has 
something to do with having at least one parent home when they come 
home from school.
  There are lots of things that could be solved if we could give 
parents more time to spend with their kids. If we can eliminate the 
marriage penalty tax, you take that 12 million American families that 
pay a penalty for being married, and this is why it is so unfair, if 
those people were living together without the benefit of marriage, they 
could file separately and save themselves thousands of dollars, $100 
billion in taxes over the next five years. There is something just 
almost insidiously wrong with that. I think we have an opportunity in 
this budget plan to right that wrong.
  I certainly support lowering the death tax. I would like to see 
lowering, if not eliminating capital gains. There are lots of areas 
where I think this Congress can effect tax relief. But there is one 
that I think stands out like none other, and that is this marriage 
penalty tax which, coincidentally, if you limit the growth in Federal 
spending to exactly the inflation rate for the next five years, you 
free up enough in terms of additional savings of Federal spending, less 
than projected, to afford to pay for this tax relief which I think 
families deserve and I think is the right thing to do.
  Mr. THUNE. Mr. Speaker, I think it strikes at the very heart, much of 
the fabric of our Nation. There are certain things that we want to 
reinforce, families staying together and being able to spend more time 
with their children.
  A lot of the social problems that we encounter in American today are 
the result of the fact that we have policies,

[[Page H3306]]

even economic policies, even tax policies that are counterproductive to 
allowing parents and families to spend more time together. If you have 
more of that cohesive time together, you would not have some of the 
social problems that we are encountering, kids who fail to have the 
time that they need to have with their parents get involved in other 
activities and probably with people that should not be associated with. 
So these things are related.
  When you talk about reinforcing the values that have helped build 
this country and make it great, I think, again, as a matter of policy, 
when you start dealing in the area of taxes and economic policy and the 
things that the Congress is able to do, it ought to be with an eye 
toward what can we do to further enhance those institutions that have 
strengthened and built this country. And certainly the family is one of 
those.
  As you noted earlier, the fact that the tax burden on this country 
consistently continues to climb and to rise and people are shocked when 
they find out how much they are paying. Many of them do not realize it 
because in a very subtle way it comes out through the payroll tax, and 
it comes out through the payroll deduction and, therefore, unlike some 
taxes which you pay and you know exactly what you are paying in terms 
of taxes, there are a lot of sort of hidden taxes, I think, today.

                              {time}  1600

  So when people find out that they are spending, which the gentleman 
said, on average, for a family of 4 is 38 percent of their income just 
to pay the cost of government in this country, that is a staggering 
statistic when we consider the fact that when we started out some 30 or 
40 years ago, as the gentleman also mentioned, it was 2 to 4 percent, 
roughly in that range.
  And that is a trend which I think we have a responsibility as a 
Congress to try to reverse so that we get to a point in a peacetime 
economy, in an economy that continues to grow, we ought not to ask more 
of the American taxpayer.
  I think much of what is being discussed today in terms of Federal 
programs are an expansion and a bigger role, which calls for more tax 
dollars from the American taxpayer to fund those programs, rather than 
looking at what we can do to address some of the problems, real 
problems that real people in this country have across the country in 
the area of child care, education and health care.
  But if we allow them to keep more of what they earn, they have 
control. They are in a position of authority, they are in a position in 
which they can make decisions as they pertain to their family's 
particular situation and needs and how best to meet those needs.
  I think it is a clear contrast in terms of the philosophy that is out 
there, the liberal philosophy, which says, let us build government 
programs and allow government to deliver the services and solve these 
problems and meet these needs. Or, rather, do we allow the American 
people, again as a matter in their day-to-day lives, allow them to keep 
more of what they earn and continually roll back the cost of government 
so their family budget is bigger and, therefore, they are better able 
and in a position to make decisions about the choices that are out 
there and the needs that they have.
  I think, again, that is a clear contrast. It is a very clear 
separation in terms of the direction that we take the country between 
the point of view that we are going to bring to the table and that that 
the liberals do.
  So as we continue down this road and track and look at ways in which 
we can better use the resources, be more efficient, modernize 
government in a way that increase employees' take-home pay for people 
in this country, in this budget debate, these are the things that will 
be underlying it. We will be talking a lot about numbers, and the 
numbers are on the surface, but when we get right down to it, the 
underlying values are what we want to reinforce in this discussion and 
the decisions that are made through the budget process.
  So again I want to credit the gentleman from Minnesota (Mr. 
Gutknecht), my friend, and the gentleman from Wisconsin (Mr. Neumann), 
and I see the gentleman from Indiana (Mr. McIntosh) joining us in the 
well here, for the work that is ongoing in terms of how we can continue 
to slow the growth of government spending and to recognize the fact 
that we have serious problems out there, retirement issues that have to 
be addressed, Social Security, Medicare, and getting the cost of 
government under control and allowing people in this country to keep 
more of what they earn.
  Those are the goals, I think, the principles and the values that we 
share and which I hope in this debate are reinforced and become a part 
of the final product.
  Mr. GUTKNECHT. As the gentleman says, this is about values. And if my 
colleagues believe in faith, family, work, thrift, and personal 
responsibility, the budget we are putting forward, where we are going 
to spend $9 trillion over the next 5 years, all we are going to ask the 
government to do is tighten its belt one notch.
  I think there is nobody who believes that in a 9-foot belt we cannot 
find 1 inch of fat that can be reduced in the Federal Government. And 
if we do that, we allow families to keep more so they can spend more, 
they can spend more time with their kids and they can build a better 
future not only for themselves but for their country, because they will 
spend that money a whole lot smarter than we will.
  I want to thank and welcome the gentleman from Indiana (Mr. McIntosh) 
and yield to him at this time.


                        Microsoft Antitrust Case

  Mr. McINTOSH. Mr. Speaker, I want first to thank the gentleman from 
Minnesota (Mr. Gutknecht) and say that I wholeheartedly endorse the 
budget the Conservative Action Team has brought to the House and 
appreciate the gentleman's work today to bring out that information.
  I would like to speak, if I may, on a different topic for a few 
minutes. I want to applaud the fact that today Microsoft Corporation 
and the Justice Department reached a temporary cease-fire in the legal 
dispute about whether they can proceed to issue Windows 98 so that 
American consumers can have the latest in software technology for our 
home computers.
  But I am troubled by what is going on in this case, and I wish to 
share my concerns with my colleagues today and with the American 
people, because I sense that our Justice Department is misusing the 
antitrust laws simply because they see a corporation in America that 
has produced a product that is very successful, very much valued by the 
American consumer and, frankly, poised to take us into the next century 
with a lead in that technology.
  There is a proper role for antitrust laws in our economic 
marketplace, but they are to be used when there is a barrier to entry 
that allows a corporation to have an unfair competitive advantage in 
monopolizing a marketplace. When we talk to economists about the 
computer industry, and particularly about software, we do not see that 
type of barrier to entry. In fact, as Mr. Gates testified to the 
Senate, if he does not produce the best-operating software, one of his 
competitors who is very capable will produce a better software and 
immediately have the opportunity to take over that leading market 
share.

  This is an area where technology is changing every day. Back 20 years 
ago, IBM was the leading computer manufacturer and had a dominant 
position. But they failed to see the advances that were happening in 
the software industry and lost that dominant position to Microsoft. How 
did this happen? It happened because the government stood back and 
allowed ingenuity and innovation to take its course in America.
  And that is what we need to do today, make sure that no one is 
prevented from coming to the marketplace and offering a product, but 
not holding back those who have succeeded when they invest the fruits 
of those successes in developing new products which are available for 
the American public.
  I will remind my colleagues, the product that Microsoft is accused of 
having used monopoly power for now costs the American consumer one-
tenth of what it did but 5 years ago. So I would urge our Justice 
Department to be cautious in misapplying the antitrust laws so that we 
do not stifle innovation, but allow all American consumers to take 
advantage of lower prices,

[[Page H3307]]

better technology and an increase in power to use the personal 
computer.

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