[Congressional Record Volume 144, Number 132 (Monday, September 28, 1998)]
[Senate]
[Pages S11013-S11014]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         TAX CUT AND THE BUDGET

  Mr. BUMPERS. Madam President, I want to speak for just a few minutes 
on what the House did last Saturday in announcing that they had passed 
an $80 billion tax cut. To tell you the truth, I take a lot of ribbing 
around here about the length of this cord. And to really say everything 
I need to say and want to say about what the House did Saturday would 
take another 10 feet on this cord, because I really think it is one of 
the most irresponsible acts--knowingly irresponsible acts--I have ever 
seen since I have been in the Senate. To add insult to injury, I heard 
a young Congressman Saturday evening on the news saying, ``After all, 
the Republicans created this surplus. They ought to have some say so 
about how it is going to be used.''

  I have heard hyperbole in my day, but I think that exceeds anything I 
have ever heard in my life, because it was in 1993, on the floor of the 
U.S. Senate, where we had to bring the Vice President of the United 
States over to pass a bill that President Clinton had submitted to us 
under which he promised would result in balanced budget. When he ran 
for President in 1992, he didn't promise a balanced budget. What he 
promised was that he would reduce the annual deficit by 50 percent 
during his first 4 years in office.
  Bear in mind that the 2 years before President Clinton took office, 
under President Bush--and you can go back as far as 1981--the deficits 
started running totally out of control, as every economist in the 
Nation said they would, after we cut taxes and increased spending in 
1981 as a part of the Reagan revolution.
  By the time George Bush finished his term, if I am not mistaken, the 
last two deficits for 1991 and 1992 were about $250 billion to $300 
billion a year. It was frightening. I am just 1 of 100 Senators here, 
but I can tell you, I had decided that the place was utterly out of 
control.
  So when the President promised the American people he would cut the 
annual deficits in half and submitted what was called OBRA 93, the 
Omnibus Reconciliation Act of 1993, it did, in fact, raise taxes and it 
cut spending by an equal amount. We were supposed to raise taxes by 
$250 billion and cut spending by $250 billion for an impact over the 
ensuing 5 years of a reduction of the deficit by $500 billion.
  The people of the country, shortly thereafter, became rather excited 
about it. The bond daddies in New York City, who pretty much determine 
economic policy in this country, were excited, too. After all, they 
said, maybe these clowns really are serious for a change.
  I will tell you how serious it was. As I said, when we tallied up the 
vote, it was 50 ayes and 50 nays. Vice President Gore sat in the Chair 
of the Presiding Officer, which is his constitutional duty, and untied 
the vote. So the Clinton bill, OBRA 93, passed 51 to 50 without one 
single Republican vote. Not one. It had come from the House of 
Representatives to us where it had passed the House of Representatives 
without one--without one--single Republican vote. The bill passed the 
entire Congress, House and Senate, without one Republican vote on 
either side, and this young House Member stood up on the floor of the 
House on Saturday and announced to the world, ``After all, the 
Republicans created this surplus.''
  When President Clinton became President and we passed that bill, OBRA 
93, in August of 1993, we made it retroactive. Not fair. It really 
wasn't fair. I didn't like it myself, but I voted for it. A lot of 
fairly wealthy people--and I have a few wealthy friends, my brother one 
of them, and he practically threatened to cut me out of his will 
because we made it retroactive.
  What happened as a result of making it retroactive? I will tell you 
precisely what happened. Instead of the projected $290 billion deficit 
for 1994, it turned out to be $254 billion, $36 billion less than had 
been anticipated, $36 billion less than each of the 2 preceding years 
of the Bush administration. The projections for 1994 had been $290 
billion to $300 billion. That year, it turned out to be $207 billion, 
and people began to get excited about the deficit suddenly going down 
for a change. People's confidence level rose. The unemployment rate 
began to go down. When people have confidence, they spend money. The 
economy began to really soar, and the more it soared, the more taxes 
people paid.
  When 1995 rolled around, it went from--it wasn't $290 billion, as had 
been predicted the preceding 4 years. It was down to $154 billion in 
1995. People were really getting excited. These are sort of round 
figures. I am not sure of the precise figures, but they are close 
enough.

  In 1996, the deficit went to $107 billion, and in 1997, $22 billion. 
By this time, the whole country is absolutely incredulous. They cannot 
believe that a country that had shown every sign of taking leave of its 
senses had suddenly come to its senses, and the deficit, which was $300 
billion a year as far as the eye could see the day Bill Clinton was 
inaugurated, was suddenly $22 billion last year.
  Right now, 3 days from now, on Thursday of this week we feel--OMB and 
the Congressional Budget Office feel--that the surplus could run 
between $50 billion and $63 billion. It is the first time in 30 years, 
and the only reason we did it 30 years ago was because Lyndon Johnson 
dumped the Social Security trust fund into the budget, and the Social 
Security trust fund caused us to have a surplus in 1969. We haven't had 
one since until this year, which hopefully will materialize on 
Thursday. And this young House Member says the Republicans created this 
surplus, that they have some rights about what to do with it. They have 
some rights, of course, but I cannot tell you how offended I am by that 
when the 1993 bill is the very thing that cost the Democrats control of 
Congress.
  Two of the finest Senators I have ever known in my life, good 
friends,

[[Page S11014]]

lost their seats because they voted for that bill. The House Members 
were swept out totally because of that bill. I have said on the floor 
before and I will repeat it, if that is what it took--no matter how 
traumatic it is to me that the Democrats lost control and still don't 
have control of Congress--that it was not too big a price to pay to get 
our fiscal house in order. And here are the Republicans, again, at the 
same old stand with the same old economic policy saying, ``We've got to 
cut taxes.''
  What is the tax cut? It is the same old tax cut: 53 percent of it 
goes to the wealthiest 15 percent of the people in America. If I were 
rich, I would be a Republican, too. No, I wouldn't. My father would be 
whirling in his grave if I did a thing like that.
  Well, let me give you the bad news. The bad news is, the surplus is 
not real. It is not a certifiable surplus. Do you know why? Because we 
still use Social Security in the budget. If we had truth in budgeting 
around here, where all the trust funds--the Social Security trust fund, 
the highway trust fund, the airport trust fund, the pension funds--if 
all of those funds were taken out of the budget, not only would we not 
be looking at a surplus, we would be looking at a very healthy deficit.
  And so as rhapsodic and euphoric as most people are about what we 
call a surplus for the first time in 30 years, it is not a surplus. 
There is $100 billion in the budget this year that is money right out 
of the Social Security trust fund. You take the $100 billion Social 
Security trust fund out, and you have a healthy $40- to--I don't know 
what the figure is--somewhere $40-plus billion deficit.
  This is no time--we know that Social Security under the present 
system is going to be totally bankrupt in about the year 2029; and by 
the year 2013, we are going to be paying out more every year than we 
take in, which is a far cry from a $100 billion surplus we are getting 
a year now. I think the Social Security trust fund in about the year 
2013 will have over $3 trillion in it--$3 trillion. You think about all 
that money, but by the year 2029 it will be dead broke, it will be on a 
pay-as-you-go basis. We will be taking in money one day and paying it 
out the next. There will be no trust fund.
  So when the President said, ``Social Security first,'' he meant that.
  What does ``Social Security first'' mean? It means that you do not 
pay for tax cuts with Social Security trust funds. Right now, if we 
raid the surplus, we are raiding the Social Security trust fund.
  As I said in the beginning, I need about 10 more feet of cord on this 
thing to say everything I want to say. I just do not speak well unless 
I have an opportunity to walk up and down this aisle. All I want to say 
to my brethren on the other side --good friends, people whom I like--
and I am not in the business of giving Republicans political advice; 
they have been doing reasonably well without me. But I will say this: 
They should know--and they do know it, and I think they had a few 
defectors over in the House the other day who said, ``I'm not about to 
go home and face people and tell them that I have just voted for a tax 
cut for the wealthiest people in America and I did it out of the Social 
Security trust fund.'' I would love to run against somebody who voted 
that way. I would do my very best to hammer them into the ground, 
because it is an honest accusation and it is pointing out to the 
American people what irresponsible conduct this Congress is capable of 
engaging in.
  So I do not think it is any secret to the Speaker of the House or any 
of the House Republicans who voted for it. And, quite frankly, I do not 
think it is going anywhere in the U.S. Senate. And in the unlikely 
chance it should also pass the Senate, I do not think there is a chance 
in the world that President Clinton--I do not care how weak he is or 
how weak he is perceived to be, I can almost give you an ironclad 
promise he will veto that bill. And I promise you, the veto will not be 
overridden.
  While President Clinton has been a friend of mine for 25 years--I 
guess longer than anybody in the Senate--he is a friend of mine, I do 
not deny that, has been; we come from the same State; we share the same 
political friends at home. I do not have any doubt about his absolute 
commitment on things like this. I am trusting him completely when he 
says he will veto the bill, and, as I say, I am going to do everything 
that I can to make sure it never reaches his desk.
  Having said that, let me say one final thing. Madam President, in 
1981, Ronald Reagan said he would balance the budget by 1984. Ray 
Thornton--a former Member of the House, told me his 81-year-old father-
in-law said one day somebody told him, ``Ronald Reagan is going to 
balance the budget by spending more money and cutting taxes''--take in 
less and spend more. He said, ``What a dynamite idea. I wonder why 
nobody ever thought of that before.''
  The day Ronald Reagan held up his hand and was inaugurated, the 
national debt was $1 trillion; and 8 years later when he left, it was 
$3.2 trillion. He managed to triple it in 8 years. But you know 
something? I voted with the President in 1981, not quite the way he 
suggested, but I voted for the spending cuts that he proposed and 
against the tax cuts. Fritz Hollings and Bill Bradley and I were the 
only three Senators who voted that way, and we would have balanced the 
budget in 1984 if everybody had voted that way. But, as you know, 
everybody did not vote that way.
  So what happened was, we wound up doubling defense spending within 4 
years after Ronald Reagan was elected President--doubled it within 4 
years. That was back when we found out, after throwing all that money 
at the Pentagon, they we were paying $7,000 for toilet seats and $7,000 
for coffee makers--the same thing everybody does when you throw that 
much money at them.
  Madam President, I have said about all I want to say except, I will 
be lying prostrate at the end of this cord in this aisleway the day 
that tax cut passes here. I plead with my colleagues, let's do 
something completely apart from politics. Let's not do something that 
is as irresponsible as that is. Nobody, I guess, ever lost an election 
by voting for a tax cut.
  People here are getting pretty apprehensive about voting against a 
so-called marriage penalty. The one thing you never hear is that many 
married people already have a bonus. There is a marriage penalty for 
some, but many married people are a lot better off filing joint returns 
than they are filing as single persons.
  I would not mind addressing the problem of what the House did the 
other day which, I think, amounts to an average of $240 a year. That is 
about $20 a month. Well, that is not beanbag for some people, but it is 
not enough to rape and pillage the Social Security trust fund for when 
those very people we are trying to help are also concerned about that 
Social Security trust fund being viable when they get to 65 years of 
age. And you ask them, ``Would you rather be assured that the Social 
Security trust fund will be there for you when you retire or would you 
rather have a $20-a-month tax cut?'' Talk about no-brainers.
  Madam President, I yield the floor and suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BUMPERS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BUMPERS. Madam President, as I understood the parliamentary 
situation, at the hour of 2 p.m. there will be 1\1/2\ hours to debate 
the motion to proceed to the Internet bill. Is my understanding of that 
correct?
  The PRESIDING OFFICER. We are in morning business until 3:30.
  Mr. BUMPERS. Until 3:30.

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