[Congressional Record Volume 144, Number 134 (Wednesday, September 30, 1998)]
[Senate]
[Pages S11169-S11170]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          TAX CUTS AND THE GOOD GOVERNMENT AMENDMENT MUST PASS

  Mr. GRAMS. Mr. President, just briefly, today, as you know, marks the 
end of the fiscal year for Washington, the fiscal year of 1998; 
tomorrow will be the first day of fiscal year 1999. This turn of the 
calendar, like any new year, is an appropriate time to review the 
accomplishments of the previous year and also to set goals for the next 
year.
  What a year it has been. Last year, we passed significant tax 
relief--including a $500 per-child tax credit that will soon take 
effect. In addition, for the first time since 1969, we passed and 
abided by a balanced budget. It has not been easy. It has not gone 
without temptations. There have been spirited attempts to spend 
taxpayer dollars and drag us into an even larger deficit, blowing one 
spending cap at a time. This remains a difficult task even today--
Congress is pushing to complete legislative work on all 13 
appropriations bills by this time. But to date, the President has 
signed only one into law, and only two others are on their way to him. 
The reason for the delay is that by habit, Washington loosely 
interchanges the act of deciding how much to spend with that of 
``spending much.''
  To my dismay, many colleagues and the President's Administration have 
used this end of the fiscal year and the near end of the Congressional 
session to push for their election-year political agendas. The result? 
Again is political blackmail: if you do not give me this, I will shut 
the government down and blame you for being heartless and ineffective. 
This delay has also put off important consideration of overdue tax 
relief for hard-working American families. In fact, the entire tax bill 
recently passed by the other legislative body is now in jeopardy 
because Washington cannot decide on how best to spend taxpayers' money 
for political agendas.
  Now, let me be clear on my position. A tax cut is not spending. Only 
in Washington's bookkeeping do we consider a cut in revenue to be 
spending.
  Mr. President, are we going to allow another Government shutdown--a 
situation where everybody loses? I certainly hope we don't. In the past 
few months, I have asked both the Senate majority leader and the Senate 
minority leader several times to honor the commitment they made during 
the consideration of last year's disaster relief legislation to support 
a bill I introduced called the ``Good Government Amendment,'' which 
would create an automatic continuing resolution to avoid a Government 
shutdown. But so far, it has been to no avail.
  We do have a system that allows the Government to operate through 
October 9. But what happens if that agreement, that continuing 
resolution allowing the spending to go on, is not extended and the 
threat of a shutdown could cost the taxpayers billions more in new 
spending in order to close this year?
  With the end of the fiscal year upon us and just a few days left in 
this session, don't you think we need a contingency plan, some 
mechanism to avoid the end-of-session battles that often result in more 
Government spending?
  There are essential functions and services of the Federal Government 
we must continue, regardless of our differences in budget priorities. 
Our constituents deserve assurances that the Federal services they 
expect will not be bogged down by politics. They should also expect 
that Washington is trying to find ways to spend their money wisely and 
not wastefully. The rest should be returned in the form of tax relief.
  Mr. President, despite a shrinking Federal deficit, total taxation is 
at an all-time high. The tax relief Congress enacted last year doesn't 
go nearly far enough; it returns to the taxpayers only one cent for 
every dollar they send to Washington. By the way, taxes on the average 
American family are at the highest level in history--even higher than 
during World War II. The average family will pay about 40 percent of 
everything they make in taxes to Federal, State and local governments.
  I urge my colleagues to review CBO's August Economic and Budget 
Outlook, which shows precisely where revenues will come from in the 
next ten years. The data indicates that the greatest share of the 
projected budget surplus comes directly from income taxes paid by the 
taxpayers, not through the FICA taxes, or Social Security.
  In 1998, individual income, corporate, and estate taxes consist of 80 
percent of total tax revenue growth, while the share of FICA tax is 
about 20 percent of that growth. General tax revenues are expected to 
grow by $723 billion, or 60 percent, over the next 10 years.
  What I am saying is that the taxpayers generated the surplus, outside 
of the money earmarked for Social Security, and we ought to return at 
least a portion of it to them. If we don't return at least some of the 
surplus to the taxpayers--and soon--Washington will spend it all, 
leaving nothing for tax relief or the vitally important task of 
preserving Social Security. Such spending will only enlarge the 
Government, and if we enlarge the Govenment today, it will make it even 
more expensive to support in the future.
  The tax relief proposal now making its way through Congress will help 
farmers and small business owners to pass their legacies to their 
children. It would reduce self-employed medical costs, and it would 
correct the injustice of the marriage penalty tax.
  My problem with this proposal, however, is that it just doesn't go 
far enough. I think most Americans, if given the facts, would agree, 
looking at their own pocketbooks and their own tax statements, that tax 
cuts are needed.
  Mr. President, some in the Senate juxtapose tax relief with Social 
Security reform. They suggest to the American people that they are 
mutually exclusive choices. They say you can't have one with the other. 
If you have tax cuts, we are not going to save for Social Security and 
protect it; or if we protect Social Security, we can't have

[[Page S11170]]

tax relief. That is not true. That is not the case. To be sure, 
Washington has been guilty of mishandling the Social Security system.
  Since 1983, Washington has raided more than $700 billion from the 
trust funds for non-Social Security programs, and Congress voted for 
the spending. In the next 5 years, the Federal Government will raid 
another $600 billion from the Social Security trust funds, as well.
  Now I hear some who come to the floor and say they won't vote to use 
Social Security trust funds to give tax relief. I ask, why their change 
of heart today? They voted for most, if not all, of the spending bills 
in the last 15 years which have used Social Security to make up the 
difference of revenues versus outlays. In other words, they are willing 
to take Social Security surpluses and put it into higher Federal 
spending, but they are not willing to take excess income revenues and 
put it into tax relief for average Americans.
  I just note that no one raised the issue of saving Social Security 
when those spending initiatives were on the table. No one juxtaposed 
spending with Social Security. That was because Washington was spending 
other people's money. But once the tables are turned and the Senate is 
asked to pass tax relief for America's hard-working taxpayers--meaning 
that Washington gets a little less--suddenly, we face gridlock and are 
in a quandary.
  Again, Washington says it just can't afford to let Americans have 
some of their money back; Washington needs it to satisfy its spending 
appetite. I always ask Americans, ``Did Washington ever call you and 
ask how are you going to get by with less money if we raise your taxes? 
How are you going to continue to provide for your families?'' And they 
say, ``No, they never call and ask that.'' They just pass it and take 
it. So American families have to then learn how to do more with less, 
or get by without.
  Mr. President, despite the rhetoric of saving Social Security, few 
have come up with a concrete plan to actually save it. The problem is 
that, by law, the Social Security surplus has to be put into Treasury 
securities. That means Washington can legally use the money to fund its 
non-Social Security pet programs. They take the money out of the trust 
fund, put it into the General Treasury, and then spend it. Ask anybody 
how are they going to take any money out of the Social Security trust 
funds? How are they going to redeem any of those notes or Treasury 
bills in the trust fund? They are going to have to go to the American 
people and ask for more money in taxes in order to retire the debts.
  In other words, the money Americans have already saved for their 
retirement future has been spent by the Government, and the Government 
is now going to come back to you and say you have to pay again in order 
to satisfy the needs. So these assets are essentially nothing more than 
Treasury IOUs, redeemable only by cutting spending, raising taxes, or 
borrowing from the public. Unless we change the law, Washington will 
continue to use Social Security until it goes broke.

  Mr. President, I am going to introduce legislation next week that 
will help shift retirement decisions back to those who know retirees' 
needs the best, and that is the retirees themselves.
  On the last day of the fiscal year, we can be proud of the Balanced 
Budget Act that Congress enacted and upheld over the course of the past 
year. But we must also be prepared for the upcoming year, as well. A 
Government shutdown is looming again--a testament to politics in an 
election year more than sound debate over budget policy. I truly hope 
that this political chicanery does not make tax relief, and ultimately 
the hard-working American taxpayers, the losers in this inside-the-
beltway game of politics.
  I yield the floor.
  Mr. CRAIG addressed the Chair.
  The PRESIDING OFFICER. The Senator from Idaho is recognized.
  Mr. CRAIG. Mr. President, I thank my colleague, Senator Grams, for 
dealing with an issue that this Senate has to deal with, and in a very 
short time. Somehow there is this belief here in Washington that you 
can save Social Security, but you can't give tax relief. Well, I, like 
Senator Grams, believe we must and can do both, not only to keep the 
economy moving and growing, but also to recognize the importance that 
we have a surplus, thanks to our diligence over the last decade, and 
now we can use it to strengthen and reform Social Security, and we 
probably have the opportunity of a generation to do that. I hope that 
the Congress can and will do both.
  Mr. GRAMS. I thank the Senator.
  Mr. CRAIG. Mr. President, I ask unanimous consent to speak as in 
morning business for no more than 10 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. Craig pertaining to the introduction of S. 2533 
are located in today's Record under ``Statements on Introduced Bills 
and Joint Resolutions.'')
  Mr. CRAIG. With those considerations and the bill introduced, I yield 
the floor.
  Mr. THURMOND addressed the Chair.
  The PRESIDING OFFICER. The Senator from South Carolina.

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