[Congressional Record Volume 144, Number 148 (Friday, October 16, 1998)]
[House]
[Pages H11034-H11038]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    THE BUDGET AGREEMENT AND THE ACHIEVEMENTS OF THE 105TH CONGRESS

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 7, 1997, the gentleman from Georgia (Mr. Gingrich) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. GINGRICH. Mr. Speaker, I want to talk about the budget agreement 
and the achievements of this Congress. This is probably the next to the 
last day that we will be in session, and it seems to me appropriate to 
look back, not just over the last 2 years, but over the last 4 years, 
because this is sort of the end of phase two of what has been a very 
dramatic change in policy.
  Four years ago, for the first time in 40 years, since 1954, the 
American people asked a Republican leadership to take over the 
Congress. We came with a set of goals. We had campaigned on a Contract 
With America, where we said that we would balance the budget, reform 
welfare, cut taxes, strengthen defense. We worked very hard at that.
  We had to learn a lot. No member of the Republican majority in the 
House had ever served in the majority as a Republican, except the late 
Bill Emerson, who was here as a page, a sophomore or junior in high 
school, when the Republicans were last in charge. So we did not know a 
great deal about the complexities of our system.

                              {time}  1400

  We passed bills in the House. In fact, we met our commitment under 
the Contract With America, and we passed all the bills except one that 
was in the Contract within the first 93 days. But then they went to the 
Senate, and we learned the hard way that the other body can be more 
complex and more difficult. And then even when we worked out agreements 
with the Senate, we discovered that under the Constitution with the 
President's power of the veto, working things out between conservative 
Republicans and a liberal Democrat can be very complex.
  One of the reasons I am so proud of the budget negotiations of the 
last few weeks is that I think we took into account that complex 
constitutional provision and we established an opportunity for us to 
continue to move in a direction we believe in, while recognizing the 
power of the President's veto pen and recognizing that on some issues 
the other body does not fully agree with us. This occurs, I think, in a 
backdrop of frankly pretty remarkable successes.
  Probably the most powerful single items we campaigned on in 1994 were 
reforming welfare and balancing the budget. And the track record is 
clear. In the last Congress, we passed welfare reform three times. It 
was vetoed twice, and the third time it was signed into law.
  Today, because of that Republican welfare reform bill signed by a 
Democratic President in a bipartisan effort, there are 3\1/2\ million 
fewer people on welfare, 3\1/2\ million more people in the private 
sector. That means we have been liberating poor people from being 
trapped in public housing, living on food stamps, and Aid to Families 
and Dependent Children. We have been giving them the kind of training, 
the kind of job opportunities, we have opened up for them the 
opportunity to go to live a better life with a better income, to have a 
chance to climb the ladder of opportunity.
  But there was an important secondary effect which had been felt by 
every State government, most city governments, and now by the Federal 
Government. And that is when we take 3\1/2\ million people who have 
been living on welfare, drawing money from the government, and put them 
out into the private sector where they are paying taxes, we change the 
cash flow of the government very dramatically.
  This has helped State after State. I noticed it in Montana. It had a 
50 percent decline. There are counties in Oklahoma that have had a 70 
percent decline in welfare rolls. In New York City, Mayor Rudy Giuliani 
has announced that his goal is to have no one on welfare after the year 
2000. Every able-bodied adult will either be working or being trained 
to work, but no one will be sitting passively receiving welfare.
  These are very dramatic changes. That was the number one change of 
the first 2 years that the Republicans were in charge of the Congress 
in this cycle.
  But in that period, as powerful and as important as welfare reform 
was, it did not meet all of our goals. We were not strengthening 
defense. We were stopping the liberals from cutting defense, but we 
were not strengthening it. We were not cutting taxes. We had not 
balanced the budget.
  So, we came back and last year, in a very difficult, very complex 
negotiation with the President, at the end of July we reached a 
bipartisan agreement. And it was historic. Last year, we saved 
Medicare. We passed the entitlement reforms to balance the budget, and 
we cut taxes, including a cut in the capital gains tax to continue 
economic growth, giving us what will soon be the longest peacetime 
expansion in American history. Including a cut in the death tax as a 
step towards abolishing the death tax, because we do not believe it is 
right to punish parents and grandparents when they work and save all 
their lives by having them taxed when they die. Including a $500 per 
child tax credit, which we had committed to in the Contract With 
America, because we believed, and do believe now, that it is important 
for parents to have the money in their take-home pay so that parents 
are in a position that they can spend the money on their children. And 
that is why we thought a $500 per child tax credit was a good idea.
  I happened to be with Governor Terry Branstad at one point when the 
septuplets were born, and we were talking about what it meant to have 
$500 a year tax credit when a family has that many children, and how 
much they need the money and, as I went into, parents all over America 
who have two or three children who might be working at a job where that 
extra $1,500 a year is a big deal. We are grateful and glad that we 
could pass and get signed into law the $500 per child tax credit.
  We also passed educational tax breaks last year, which the President 
proposed and we adopted together, and on a bipartisan basis we did some 
things that were good for education, particularly at the college and 
vocational-technical level.
  Because we saved Medicare without raising the FICA tax, which would 
have killed jobs; because we reformed the entitlements and saved $600 
billion; because we were able to cut spending on the domestic 
discretionary side, and there I commend the gentleman from Louisiana 
(Mr. Bob Livingston) for his hard work; because we were able to cut 
taxes to continue economic growth, the budget in the fiscal year that 
just ended, fiscal year 1998, is balanced for the first time since 
1969.
  Now that is a tremendous achievement. $71 billion is the current 
projection. We will know the exact number in a couple more weeks when 
the Treasury reports. But the estimate now is that the budget was 
balanced not in 2002, when we promised we would balance it; not in 
2005, which was the President's proposal; it is balanced in 1998, 4 
years ahead of schedule.
  And of the $71 billion, every penny will be put aside, actually to 
pay down the debt as a step toward saving Social Security. Every penny, 
the largest surplus, I think, in American history. And the important 
thing is, it is being followed this year, and we are now in fiscal 
1999, the fiscal years run from October to October, now in this fiscal 
year,

[[Page H11035]]

we will have another surplus. The current estimate is it will be at 
least $60 billion on top of last year's $71 billion.
  In fact, because of our hard work over the last 4 years, because we 
reformed welfare, because we reformed the entitlements, because we cut 
domestic spending, because we cut taxes to increase economic growth, 
and because when we balance the budget we lower interest rates, because 
the Federal Government is the largest borrower, and when the Federal 
Government does not have to borrow, interest rates come down, the 
estimate is they come down by at least 2 full percentage points at the 
same stage of an economic cycle from where we are borrowing, here are 
the numbers that I think are truly historic:
  This Congress, with Republican leadership working with a Democratic 
President, this Congress moved us from January 1995, when the 
projection was that we would borrow $3.1 trillion over the next 11 
years. The numbers are almost unimaginable. Let me repeat them. The 
projection when we took over, after the liberal Democrats had raised 
taxes and claimed it was deficit reduction, the projection was that our 
government would be borrowing $3.1 trillion over the next 11 years.

  That is $3.1 trillion that our children and our grandchildren would 
spend all of their lives paying taxes to pay interest on that Federal 
debt. Instead today, because of the Republican reforms working with a 
Democratic President, because the Republican reforms worked, we are 
talking about a surplus of $1.65 trillion. Let me repeat that number, 
because it is, again, big. A surplus of $1.65 trillion.
  That is why the House Republicans this year said we ought to consider 
a tax cut, because we believe it is very important to get that surplus 
back home so that Americans have it in their pocket. Because, frankly, 
the only reason we have a surplus is the American people go to work, 
pay their taxes, and send the money to Washington.
  I was often asked, when it was announced that we had a balanced 
budget, and on September 30 and October 1, at the end of the fiscal 
year, there were a lot of people talking here in Washington and 
reporters would come up to me and say, ``Well, President Clinton claims 
that he deserves credit for the balanced budget. What do you think?'' 
And I think they thought we would get into a Republican-Democrat 
argument.
  I said, ``Wait a second. I think Republicans deserve 5 percent of the 
credit. I think the President deserves 5 percent of the credit. But I 
think 90 percent of the credit goes to working, taxpaying Americans who 
got up every day, went out and either created a job or went to a job. 
They paid their taxes. It is their money that created the surplus.''
  It was not the Republicans in Congress' taxes and it was not the 
President's taxes. We together do not pay enough to run this government 
for a day or an hour. It was the country. Let us give the country some 
credit, which means it is the country's surplus.
  We Republicans believe that there are two things that we should do 
with that surplus. We believe first that its highest priority is to 
save Social Security. And we believe we can create personal savings 
accounts for every person who pays the FICA tax so that they have money 
they control, that they will be able to have built up interest on a 
tax-free basis so over their working lifetime they have a base amount 
of money that is a part of the Social Security system.
  We believe, second, every penny left over above that ought to go back 
to the American people as a tax cut. But we also believe that if we 
leave a trillion dollars sitting around Washington, D.C., liberals will 
figure out a way to spend it and we will have bigger government with 
more bureaucracies and we think that is wrong. We think that money 
belong to the American people, not to the Washington bureaucrats.
  So, here we are today, having just put in the bank $71 billion, with 
a projected $60 billion to $80 billion surplus this year and with the 
Federal Reserve yesterday lowering interest rates again, continuing the 
economic growth which continues the opportunity for us to do good 
things for Americans.
  It was in that setting, having reformed welfare, cut taxes, balanced 
the budget, and saved Medicare that we went into this year's 
negotiations with the President. We had several very specific goals.
  First, we wanted to begin to rebuild national defense. Second, we 
wanted to pass very strong anti-drug legislation. Third, we wanted to 
keep Internet pornography away from our children. Fourth, on education, 
we wanted to guarantee that spending decisions would be made at the 
local level.
  These are very important steps. We also, frankly, were in a 
stalemate. The President refused to consider a tax cut and we refused 
to consider $135 billion in increased taxes and fees that he had 
proposed. So, we blocked his tax increases, he blocked the Republican 
tax cuts, and that was sort of a stalemate.
  We also knew that there were some practical problems. I had been 
traveling across the country. I knew that from Georgia to Louisiana to 
Texas, there were terrible weather conditions which had hurt family 
farms. I knew that in North Dakota and South Dakota and Montana there 
were unique problems. I knew that the drop in farm prices was causing 
American farmers a very great difficulty, because with the Asian 
economic problems we had lost a substantial number of markets that had 
been very important on to American farmers. So, we knew there had to be 
emergency help for farming.
  All of us knew, from the tragic embassy bombings this summer, that 
there were problems with our embassies and that we had to spend some 
extra emergency money to protect our embassies and that that was a 
matter of national pride. That if we had people out there serving 
America in embassies around the world, we owed it to them to strengthen 
the embassies against terrorist attack and terrorist bombing.
  We also knew that we had a year 2000 problem that was very real in 
terms of computers and being able to solve that, and that it would be 
irresponsible, irresponsible for us to not provide the resources to 
solve the problem of the year 2000 in government computing so that 
aircraft could land safely, so that Social Security checks could go 
out, so that the IRS could work, the INS could work, and all of the 
other things that we have been working on, including the FBI, national 
defense and a whole range of key areas. So, we knew that would be an 
emergency.
  So, as we entered this negotiation, we continued a process of 
commitment to reform which had been a part of the way we had been 
working for the last 4 years. And sometimes let me say these reforms 
take time. We established first a commission on the Internal Revenue 
Service. The gentleman from Ohio (Mr. Portman) cochaired that 
commission. They reported a need to dramatically reform the Internal 
Revenue Service.
  Then we had hearings by the Committee on Ways and Means on the need 
to reform the Internal Revenue Service, and the Senate Finance 
Committee did an outstanding job on hearings, listening to horror 
stories about what was wrong with the Internal Revenue Service.
  Then we had a bill produced, working in a bipartisan basis with the 
gentleman from Ohio (Mr. Traficant), a Democrat who had spent years of 
his life dedicated to reforming the Internal Revenue Service. And, 
finally, we produced and passed by a large margin a Republican-led but 
bipartisan effort which the Democratic President signed. We proved, 
once again, that America could work, because we did change the Internal 
Revenue Service and we returned the burden of proof to the government 
and we protected individuals from government's intervention.

                              {time}  1415

  Those are the kind of reforms that we entered this budget negotiation 
continuing to work for. We had a specific proposal, called Dollars to 
the Classroom, a proposal which Senator Slade Gorton had been working 
on in the Senate and the gentleman from Pennsylvania (Mr. Pitts) had 
been working on over here.
  It is a very simple idea. If we spend less money on bureaucracy in 
Washington, we can take that money and spend it in classrooms back 
home. Our model, the Republican model, was that local teachers, local 
parents, local students, in a local classroom, governed by a local 
school board, was the right place to solve education problems in 
America; that creating more Washington bureaucracies, with more effort 
in Washington, with more Washington red

[[Page H11036]]

tape, with more money spent in Washington, was not going to solve 
education, whether it was in Atlanta, Georgia, or Albany, New York, or 
Sacramento, California.
  The trick was to get the money to the classroom. In fact, we passed 
in this House the initiative of the gentleman from Pennsylvania (Mr. 
Pitts), which guaranteed 95 percent of the money would go to the 
classroom.
  I must say, with the leadership of the gentleman from Pennsylvania 
(Mr. Goodling) and Senator Slade Gorton, in the negotiations with the 
President over the last week, we did better than that. We took the 
President's proposal for new teachers, a proposal which was too narrow 
because it did not allow anyone to spend money on special education 
teachers; it was too Washington-based because it was going to have 
Washington red tape and a lot of the money was going to be eaten up in 
administration, and we changed it into a Dollars for the Classroom 
local support to hire teachers.
  We changed it in a couple of very key ways. First of all, we said the 
local school board would make the decision, no new Federal bureaucracy, 
no new State bureaucracy, not a penny in the bill that was passed goes 
to pay for bureaucracy; all of it goes to the local school districts, 
the 14,000 school districts that make such a big difference in the 
United States.
  Second, we said that the school district, the school board, could 
decide what kind of teachers they needed. They were not going to be 
trapped into the President's proposal of only first, second and third 
grade and only general teachers. If they needed special education 
teachers, they could get it. If they needed special aid teachers, they 
could get it. If they wanted to hire them for any grade level, they 
could choose.
  So we had reestablished principles that we thought were very 
important. Yes, there will be teachers but they would be the teachers 
your community needed, picked by your school board and filling the kind 
of classes you think you need to solve your problems, and we included 
special education children and special education teachers in our 
proposal.
  We thought it was a win-win. The President got to claim victory, but 
the fact is it is the American people who are better off and the 
children of America who are better off.
  We insisted on the first increase in defense spending since 1985. For 
the last 13 years, we have been living off the Reagan buildup. 
President Reagan was committed to a strong American defense. We fought 
Desert Storm with President Reagan's military, and for years we have 
not had an increase; for years there has been a gradual decline in the 
amount that we have been investing in our military. Recently, the Joint 
Chiefs of Staff, the head of the Army, the Navy, the Air Force, the 
Marine Corps and the Chairman of the Joint Chiefs, met with the 
President and said things had now declined from the President Reagan 
model, they had declined so much under President Clinton and Vice 
President Gore, the military had gotten so weak that the Joint Chiefs 
could no longer certify that the American military could lead around 
the world without risking dramatic casualties.
  We Republicans have a very simple belief. We believe if a young man 
or a young woman has the moral courage, the patriotism, to join the 
American military, if they are willing to put on the uniform of the 
United States, then we, the citizens, owe it to these young men and 
women, that they have the best equipment, the best training and 
sufficient numbers to win decisively and with minimum loss of American 
life. That is our principle.
  So I am proud to report to the House that we have built into this 
budget agreement the first increase in defense spending since 1985. It 
is $9.5 billion towards defense intelligence and antidrug interdiction 
and it is a very important building block to establishing America's 
commitment to leading the world, defending our country and making sure 
that our men and women in uniform have the best equipment, the best 
resources and the best training.
  We also had an absolute commitment to saving our children from drugs. 
Here I want to commend the gentleman from Illinois (Mr. Hastert), the 
gentleman from Ohio (Mr. Portman) and the gentleman from Florida (Mr. 
McCollum) because they worked together leading a task force on the 
antidrug effort. They worked with General Barry McCaffrey, the drug 
czar. We passed three very strong bills, a community-based antidrug 
effort, drug prevention, to make sure children know they should not be 
using drugs, and blocking drug dealers interdicting at the border, 
going after the drug czars down in places like Colombia and Peru.
  Frankly, we had some arguments with the Clinton administration. We 
are much more committed to interdiction than the Clinton administration 
is, and it is a policy argument. I am not saying that they are in any 
way bad people. They would not approach this as aggressively as we 
would. They would not spend the kind of money on interdiction we would. 
They were not prepared to do some of the things that we thought was 
essential.
  We held our ground, and we said we are going to pass strong antidrug 
legislation. We said we are going to be committed to actually funding 
the antidrug interdiction effort, and to his credit General Barry 
McCaffrey came up here, met with us and as a result we were able to 
write very strong antidrug legislation.
  The gentleman from Florida (Mr. McCollum), who has worked on this for 
years, told me it is the most powerful antidrug legislation in 
congressional history. I think it is going to have a big impact. I 
think it was the right thing to do, and I am proud that that is in this 
particular budget agreement.
  We also had a totally different provision, one which Senator Coats of 
Indiana and the gentleman from Ohio (Mr. Oxley) had been working on, 
one which said the Internet is a wonderful tool but children should not 
be exposed to pornography on the Internet; one which said that today 
all too often your child, if they learn how to use that computer, can 
be having access to pornography in a way which is totally inappropriate 
and that you ought to have an ability to make sure that that is not 
happening.
  It is a very strong bill. Let me be clear about this. The bill that 
we put in, the anti-Internet pornography bill, is a strong child 
protection bill and I want to be clear that we have no, none, no 
reservations. We are not in any way embarrassed to say to people, you 
are darn right, we want to save our children. We think it is wonderful 
that kids are learning to use computers. We think it is vital for their 
future that they learn to use computers but they ought to do so in an 
environment that is safe for children.

  This bill is in this agreement and I think it is a very powerful step 
forward in the right direction.
  I could go on and talk about a wide range of issues. There are things 
that we did that were right. There were things the President got. There 
is no question under our constitution, when there is a liberal democrat 
as president and a conservative Republican Congress, when there are 
negotiations, if they are going to be successful, each side is going to 
have to work out agreements. No one is going to win everything, but I 
think what we have done is we have passed a very responsible agreement.
  That money, which is set aside for emergencies, I think is legitimate 
and defensible. I do not want to go back and say I am not prepared to 
protect our embassies from terrorists. I do not want to go back and say 
to my folks in Atlanta and in Marietta and in Alpharetta that I am not 
prepared to make sure that our government has what it needs to solve 
the Year 2000 problem. I am not prepared to go back home and say that 
the farmers I have talked to, the fields I have looked at, the weather 
problems that are real, the price problems caused by Asia that are 
real, that I am going to walk off and write off American family farms.
  I am not prepared to go back home and say that I am going to let 
young men and women in uniform have inadequate aircraft without spare 
parts in too few numbers with inadequate training so we are going to 
risk their lives if they are put in harm's way to defend America. I 
will not do that. So I am prepared to defend the emergency part of 
this.
  The nonemergency parts, and I want to commend the Clinton 
administration, they came in with offsets, they provided a way to stay 
under the

[[Page H11037]]

spending caps in the nonemergency parts. We sustained the budget 
agreement of last year. As I said, the surplus for this year, even with 
this bill, is going to be somewhere between $60 billion and $80 billion 
in surplus, not deficit, money that can be used to save Social Security 
and money that can be used for tax cuts.
  We have a few tiny tax cuts, $9 billion worth over the next 10 years, 
much too small. I wanted a lot more. This House passed $80 billion in 
tax cuts measured over 5 years, about $175 billion over 10 years. That 
was close to the right size, still not as big as I would have liked. 
The American people deserve to have the money back in their pockets. 
They are the ones who are working and paying the taxes. It is their 
surplus, but we did get an extension of the research and development 
tax credit, which is very important, because it represents a commitment 
that we Republicans are particularly proud of.
  We believe in the Information Age it is important to invest in 
science. It is important to invest in research. We believe we are on 
the edge of tremendous breakthroughs in medicine. That is why this 
budget agreement includes tremendous increases in resources for the 
National Institutes of Health. Earlier we funded the National Science 
Foundation.
  When you look at the potential breakthroughs that we are seeing in 
diabetes, that we are seeing in AIDS, that we are seeing in cancer, 
that we are seeing in heart disease, the work that we in this Congress 
have begun to push on Alzheimer's disease, the work we are doing on 
Parkinson's disease, the possibilities, for example, of dealing with 
prostrate and breast cancer, I have a sister who is going to have her 
seventh anniversary as a breast cancer survivor on Halloween. I know 
when I talk to Robbie I know how it is important that we are doing the 
kind of research we are on breast cancer.
  I lost both my father and my stepfather to lung cancer. My best 
friend I lost to pancreatic cancer when he was 49. I know how vital it 
is that we have the resources going into the National Institutes of 
Health, and I know for American business and job creation and the 
future of this country in the world market how vital it is that we also 
have money that is going through the R&D tax credit.
  There is one other area that is very controversial that I want to 
mention because I want to be very up front about it. Yes, we have 
funding for the International Monetary Fund in this bill. Several of my 
good friends have said to me, I would like to vote yes when we have a 
chance on Tuesday but how do I go home and explain that?
  I think there are two very profound explanations. First of all, when 
looking at the economic problems in Russia, looking at the economic 
problems in Indonesia, looking at concerns that have been expressed 
about Brazil, looking at the concerns that are currently being 
expressed about Japan and Korea, I am not sure this is a very good time 
to take a big, gigantic gamble with the world economy.
  I used to be a college teacher. The gentleman from Texas (Mr. Armey), 
the majority leader, used to be a professor of economics. He wrote 
textbooks on economics. He is a hard line conservative. It is one thing 
to be out in the classroom with a chalk board explaining theoretically 
what to do, but we now bear the responsibility, as the leadership of 
the House, and I am not prepared to take a river boat gamble and decide 
let us just eliminate the IMF funding and see how things work for the 
next year and, by the way, if the world economy crashes and we end up 
in the great depression, that will be an interesting experiment.
  I think that is, frankly, irresponsible. We have to fund the IMF 
because we are the leader of the world. No one else can lead the world. 
No other country will invest in the IMF unless the U.S. does, and while 
I have big questions about the International Monetary Fund, while I 
think they are frankly not always following the right policies, it is 
clear that it would be a very, very large gamble to walk off, leave 
them without resources and then if there is a crisis not be able to 
deal with it.
  On the other hand, as the gentleman from Texas (Mr. Armey) said, and 
I believe in a historic intervention, the gentleman from Texas (Mr. 
Armey) began a year ago to say the American people deserve to know what 
the IMF is doing with their money. He said this organization is more 
secret than the Federal Reserve. He said we cannot come to the elected 
people who represent America and say to them we are going to invest $18 
billion in the IMF and not know what is being done with it, not know 
what decisions they are making, not hold them accountable. He was very 
clear. He said no accountability, no money.
  We met with Secretary Rubin, and I want to frankly put in a word of 
praise for Secretary Bob Rubin. He had been a businessman. He had been 
a deal maker. He understood how you had to sit in a room and say, all 
right, if I am going to get A, you are going to get B.
  We said to him flatly, you want 18 billion phony dollars, then give 
us phony reforms. You want 18 billion real dollars, we want real 
reforms. To his credit, he said I get it.
  Secretary Rubin, I think, did a tremendous job of sitting down with 
the gentleman from Texas (Mr. Armey), the majority leader, working out 
real reforms, and let me say how real they are. The Secretary of the 
Treasury and the chairman of the Federal Reserve both have to submit a 
report to Congress that they have convinced all 7 nations, that are the 
leaders of the IMF, that all 7 have to be committed to the Armey 
reforms.

                              {time}  1430

  All seven have to sign up that they are going to insist that the IMF 
adopt the Armey reforms. What do the Armey reforms say? They say first 
of all when the IMF makes a loan, the minutes of that decision, the 
documents relating to that decision in a timely manner have to be made 
public. We get to find out what is happening with the money, why is it 
being done, and hold them accountable for it. It says, second, when a 
loan is being made to a country that has had a bad series of economic 
decisions, that country has to pay above the market rate at which the 
IMF is getting its money, I think the minimum is 300 basis points, 3 
percent above the market rate, which is a substantial penalty for bad 
behavior, so we begin to reestablish moral hazard, but you do not have 
some nice, easy, cheap money bank over here, ``Go ahead and run your 
country in a bad way and you can always get the money from the internal 
bureaucrats.'' We start to establish a real standard of real 
involvement and real oversight. Any student of the International 
Monetary Fund will tell you that a year ago, it would have been 
impossible to have imposed these kind of genuine, deep, real reforms. I 
think that Dick Armey deserves a lot of credit because he stood up when 
a lot of people who thought they were sophisticated attacked it. Now, 
he was surrounded by people like former Secretary of State and Treasury 
George Shultz. He did have support from people like Nobel prize winner 
Milton Friedman. But I think it says a lot for Dr. Armey, an economist 
in his own right, that we got this done.
  So I can go home and say to my most conservative constituents, I am 
prepared to help support the world economy, I am prepared to make sure 
that we have the resources collectively so we do not have an 
international collapse, but I am prepared to do it only with real 
guaranteed reforms that make the IMF accountable to the American people 
and that for the first time ever establishes a legislative oversight 
board so that all the democracies will have elected legislators 
reviewing the IMF for the first time in history and that is an 
important step in the right direction towards dealing with the emerging 
world market.
  Let me summarize. Four years ago, we campaigned at exactly this time 
and said there is a Contract With America and we are serious, we will 
keep our words. We passed welfare reform and it is working. We passed a 
bill to save Medicare without raising the FICA tax, and it is working. 
We passed a bill to balance the budget, and the budget is now in its 
second year of being balanced. And not barely tiny balanced by some 
sleight of hand but $71 billion last year, and $60 to $80 billion this 
year in surplus, something most Americans did not think they would hear 
in their lifetime, and we are setting the stage to come back in January 
and begin to save Social Security.

[[Page H11038]]

 We have a budget agreement which we will vote on Tuesday which is the 
best agreement you could get when you have a conservative Republican 
Congress and a liberal Democratic President sit down side by side and 
negotiate, and I think it is an agreement which is good for the 
American people with local control of education, with special education 
children and teachers being helped, with our military being 
strengthened, with the International Monetary Fund being reformed, very 
serious steps with a strong war on drugs, and with Internet pornography 
being blocked from our children.
  I yield to my good friend from California.
  Mr. HUNTER. I thank the Speaker for yielding. I was watching his 
remarks over the last several minutes. I want to thank him and all the 
others who worked for a strong national defense in this emergency 
supplemental. It is very, very critical. I would simply ask him to talk 
a little bit about the fact that the North Koreans now have an ICBM 
capability.
  Mr. GINGRICH. The gentleman from California has been involved as a 
member of the Committee on National Security and chairman of a key 
subcommittee. Would he just share with the audience for a minute the 
kind of problems we are having with readiness and with equipment and 
personnel and with pilot retention, and why it is so vital that for the 
first time since 1985 we have begun to rebuild defense so that every 
pro-defense conservative will understand why they should vote ``yes'' 
next Tuesday for this agreement.
  Mr. HUNTER. I thank the Speaker for the opportunity to talk a little 
bit about what has happened to defense under this administration. We 
are going to be about 800 pilots short in the Air Force this year. We 
are already about 18,000 sailors short in manning the ships. When I 
talk about the ships, it is not 600 ships anymore, it is only about 330 
ships in the United States Navy. We are about $1.6 billion short in 
basic ammunition for the men and women of the United States Army. We 
are about $193 million short of basic ammunition for the United States 
Marine Corps. Our aircraft, which have a certain mission capability 
rate, that means if you have 10 airplanes in the hangar or 10 airplanes 
on the carrier deck, how many of those planes will be able to fly out 
if they are called for a mission. Our aircraft mission capability rate 
has fallen from about 72 percent on the average, Navy, Marine and Air 
Force, to about 61 or 62 percent, a massive fall in what we call 
mission capability.
  Mr. GINGRICH. I want to make sure that our audience and Members all 
understand what we have just said. Four out of every 10 aircraft, in a 
smaller Air Force, in a smaller Navy, 4 out of every 10 aircraft are 
not today mission capable at a 100 percent rate. We have fewer 
aircraft, fewer pilots. It is not like this was from the Reagan 
buildup. We have been sliding now for a decade. And in the smaller 
system, 4 out of every 10 aircraft are not capable, completely capable 
of their missions.
  Mr. HUNTER. The Speaker is exactly right. That means out of 10 
aircraft that are on the line when you call for them to do their 
mission operation to carry out their mission, only about 60 percent, a 
little over 60 percent of those aircraft are capable of doing it, and 
that is after we have cut our air wings from 24 to 13 fighter air 
wings. So we have roughly half the air power that we had during Desert 
Storm. And even those aircraft, those reduced squadrons, are becoming 
very unready.
  Mr. GINGRICH. I think it is really important to slow down so people 
lock in their head how bad the deterioration under Clinton and Gore has 
been of our military. We have about half as many aircraft in the Air 
Force and 60 percent of those are mission ready.
  Mr. HUNTER. That is exactly right.
  Mr. GINGRICH. So we probably have about 35 to 40 percent as many 
aircraft that are mission ready as we would have had at the peak of the 
Reagan buildup.
  Mr. HUNTER. That is exactly right. Let me mention something else that 
I know struck the Speaker and Jerry Solomon, chairman of the Committee 
on Rules and many others who are concerned about national defense. We 
have been looking at accident rates. I have one member on my staff who 
just cares about the people that fly aircraft, and he gives me the 
weekly accident rate. That means helicopters and aircraft that have 
just crashed during the year. We now have had 43 of them crash, at 
least according to my estimates and my reports, this year. That is 
almost more aircraft than we are building but it also claimed about 70 
lives. The Navy reports that they have more crashes this year per 
thousand flying hours than they had last year, roughly twice as many. 
Now, last year we had what was considered to be a very good year in the 
Navy in terms of a safety record. But they mentioned when they came 
over and briefed the defense committees in this body and the other body 
that this is something that they are very concerned about. So at a time 
when we are trying to get pilots to do two things, one we are trying to 
get our experienced pilots to stay in and they are not staying in. The 
rate of leaving the services for senior pilots who could stay in, who 
could opt to stay in in the Marines is now 92 percent. That means 92 
percent of them are leaving. Only 8 percent are staying who are 
eligible. But the way to instill morale and to instill a desire to stay 
in the service is to show that you are buying the absolute best 
aircraft for these people and that you are giving them all the training 
hours that they need, which we are not now doing, and that you are 
giving them all the spare parts that they need that they are not now 
doing.

  This brings me back to my point. The Speaker and his negotiators got 
9 billion extra dollars for national security, for this vital national 
security function which is inadequate right now, which is being 
abandoned. I know you did that at great pain, and I realize the 
President is half this process. And the President got some of the 
things that he wants in this bill. I would simply say to every 
conservative and every Republican or Democrat or independent who 
believes in a strong national defense for America is that the money 
that you got to restore these readiness accounts, the money that you 
got to restore our program for a national missile defense which we 
still do not have, even as North Korea builds an ICBM, the money that 
you got for the other problems with the military far outweighs any 
concessions, in my estimation, that were made to the Clinton 
administration.
  Mr. GINGRICH. I thank my friend. Let me just close by building on 
what he just said. We came in with a contract with America in 1994. In 
1995 and 1996 we passed balanced budget agreements which the President 
vetoed, we fought to balance the budget. We did get the President to 
sign welfare reform. In 1997 we became the first reelected Republican 
Congress since 1928. At that time we insisted on saving Medicare, on 
balancing the budget and on cutting taxes. Those are the three great 
achievements of 1997. This year we began with reforms such as the 
Internal Revenue Service reform bill, which was a very important step 
in the right direction that we passed in June, that was signed into 
law. We began to work on ideas like dollars to the classroom to 
eliminate Federal bureaucracy and get the money back home to local 
schools and local teachers. Now we have a sound, solid, bipartisan 
budget agreement which frankly both sides agree to, which is good for 
America and which has a wide range of things.
  Next year if we come back in the majority, we will save Social 
Security with a major bill using a large part of the surplus to save 
Social Security without cutting benefits or raising taxes, we will pass 
a very major tax cut, including, I hope, abolishing the death tax so 
that people no longer are punished if they work and save all their 
lives. We will also continue to strengthen defense, continue to work on 
winning the war on drugs, continue to reform education, and continue to 
move towards a more modern, more effective computer age government that 
costs less and provides better services and better defenses at less 
cost. I think all of this is possible. I think we can be very proud of 
this Congress. I think we can be very proud of this budget agreement. I 
hope on Tuesday we will have a resounding vote to make sure the 
American people know that we are working in a practical, commonsense 
way.




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