[Congressional Record Volume 145, Number 117 (Friday, September 10, 1999)]
[Senate]
[Pages S10717-S10718]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 TAXES

  Mr. CRAIG. Mr. President, I thank the Senator from Georgia for coming 
to the floor this morning and asking his colleagues to come with him to 
discuss what is one of the most fundamental arguments and debates this 
Senate has had, and that is the debate over taxes and how much our 
government should rightfully take from the American worker and the 
American family to fund and finance the services of government.
  When I first came to Congress in 1981, we were rapidly spending into 
deficit, and I said at that time my goal would be to balance the 
Federal budget.
  I well remember that some of the old-timers who had been in Congress 
then for 30 or 40 years laughingly said, ``Not in your lifetime, young 
man.'' ``Not in your lifetime.'' They also repeated that it really 
wasn't in the character of our Government or in the good of the Nation 
that we should ever balance the Federal budget and that deficit 
spending was appropriate and right for Government to stimulate the 
economy. I was of a different school of thought, as were many.
  In the early 1980s, I joined with Democrat and Republican who agreed 
with me to introduce balanced budget amendments and to begin to educate 
Americans that balancing the Federal budget--the annual operating 
budget and keeping it balanced--would reap this country great 
dividends.
  If you can flash back to the early 1980s, it was also at a time when 
our deficits were building in the Federal Reserve. At that time, Paul 
Volcker was saying to us: If you will get your fiscal house in order 
and I can get my monetary house in order, and we can keep them in 
balance, we can diminish inflation, lower our interest rates, and cause 
a tremendous economic growth in our economy.
  Congress in those early days chose not to listen. We continued to 
deficit spend. Paul Volcker, Chairman of the Federal Reserve, basically 
took it on himself, as did the Federal Reserve, to kill inflation in 
this economy. It was a very costly task. It threw thousands and 
thousands of people out of work. It bankrupted small companies. It 
destroyed farming and ranching communities. It was a devastating thing 
to do. But it happened.
  Some of us have already forgotten 21 percent interest rates at one 
point and high levels of unemployment. Why? Because the fiscal and 
monetary policy of this Nation's Government was out of sync. We 
continued to deficit spend. We continued to mount those deficits until 
1994. The American people said enough is enough, and we will listen to 
a conservative Republican Congress, and we want you to balance the 
budget. So they changed our country significantly by electing a more 
conservative Republican majority in Congress. The rest of the story is, 
while difficult at times, quite simple; that is, we balanced the 
budget. We did so by restricting the growth of spending at a time when 
new technologies in our economy were exploding on the scene. The 
economy and the fiscal policy and monetary policy began to go into 
balance. We have seen the most phenomenal economic renaissance 
literally in the history of this country, if not the history of the 
world.
  Our economy today drags the rest of the world's economies with it. 
Our workforce has never had more options, generally speaking, and 
opportunity for employment in the history of our country, except, as 
the Senator from Georgia knows, in rural agricultural communities and 
some of our resource-based communities where agricultural policy or 
Government policy is not in sync at this moment, and where we have a 
unique phenomena around the world such that our biotechnology has 
expanded around the world to the point of creating tremendous surplus 
because of the balanced budget.
  Because of the fiscally responsible Congress, we are now experiencing 
the politics of surplus--not deficit but surplus. The politics of that 
surplus is really quite simple. For those who like to spend, they lick 
their chops and rub their hands and say, look at all we can do more 
than we are doing for the American people.
  For those of us who really believe we are doing enough and that the 
American people best know, as the Senator from Georgia said, where and 
how to spend their money on their families, the politics of surplus is 
the opportunity to reward the American people for their wisdom in 
requiring their Government to balance its budget and to return to the 
American family the money that is rightfully theirs in the reality that 
we are, in fact, overtaxing the American workforce for the amount of 
money necessary to run Government.
  We knew coming to this session of Congress that what we wanted to do 
for the American workforce and the American taxpayer in returning to 
them their money would be a difficult task at best. The first sounding 
of the alarm came with the President's State of the Union Message when 
he not only proposed in a time of surplus 80-some new spending programs 
but even proposed a tax increase. I mean, my goodness, Bill. We are 
talking about potentially hundreds of billions of dollars of surplus 
and the argument is that we are probably overtaxing the American people 
and you want more money and you want to tax more. That really was the 
beginning of the battle that we have engaged in for about 7 long 
months.
  It was also quite obvious from the very beginning this President 
would have an ally. That ally would be the liberal press that, from the 
very beginning, was always asking people such as me and the Senator 
from Georgia: Well, but what about the President's position? Don't you 
think that is the right position?
  In essence, they were saying: My goodness, you are surely not going 
to give back this money when you can spend it on all of these programs.
  Here is how all of that refines itself into headlines. I was 
fascinated by it.
  In February, I asked the Chairman of the Federal Reserve, Alan 
Greenspan, who all of us respect greatly, to come to speak to the 
Republican policy luncheon. He said: What do you want me to speak 
about? Quite simply, I want to ask you one question: What do you do 
with surplus? Alan Greenspan came. And he said: Let me suggest that

[[Page S10718]]

you reduce marginal rates, you pay down debt, ``but, most importantly, 
you don't spend it.''
  ``Most importantly, you don't spend it.''
  He said the reason is quite simple. Don't send a message to the 
economy of this country that you are going to lift the caps and start 
spending money. He said it will be a most negative message because the 
available resources of this country are now dedicated to growth and job 
creation in the private marketplace. And if you suggest that you are 
going to increasingly take more of it and spend it in Government, you 
will send a more negative signal. Don't do it.
  Before the August recess, after we had shaped a tax bill and we were 
in the final days of debating it and getting ready to send it to the 
President, the headlines in the papers were ``Alan Greenspan not in 
favor of tax cut.''
  The reason I use that example is because it typifies what we knew 
very early on--that we have many enemies out there as did the taxpayers 
have in pushing this message. Enemy No. 1, Bill Clinton; No. 2, a 
collective press that would not fairly write to the American people the 
broad base of this argument.
  Let me tell you what Alan Greenspan said that extrapolated itself 
into headlines as ``not in favor of tax cut.'' He said, and I am not 
going to extrapolate; I am going to quote:

       My first priority, if I were given such a priority, is to 
     let the surplus run. As I have said before, my second 
     priority is if you find that as a consequence of those 
     surpluses they tend to be spent--

  In other words, Alan Greenspan is consistent with February and late 
July--

       Then I would be more in the camp of cutting taxes because 
     the least desirable is using those surpluses to expand 
     outlays or to spend.

  Greenspan continued:

       I give great sympathy to those who wish to cut taxes now to 
     preempt that process, and, indeed, if it turns out that they 
     are right then I would say moving on the tax front makes a 
     good deal of sense to me.

  Do you know that Alan Greenspan is right? Already the forces of the 
idea that the President will veto this package are at hand saying: Can 
we have another $10, $15, or $20 billion?
  Can we have all of the surplus that will be generated out of the 
general fund and spend it because the priorities are so important?
  If we send a signal to the American economy, and Bill Clinton helps 
it with a veto of this tax bill that will go to him next Tuesday, that 
we are turning on the spending machine, I am not so sure that a year or 
two from now we will see near zero unemployment in our country; we will 
see the vibrant economy; we will see the investment capital; we will 
see the job creation that has given the American people more reason for 
optimism than anything we have done or we could do as a government in 
the last good many decades.
  I am suggesting what the Republican Congress has done in proposing a 
very broad-based tax cut is responsible, consistent with our economy, 
fair, and it is intended to help people. It is intended to say to the 
American family: Taxpayers are entitled to more than 50 percent of what 
they earn, to save, to invest, to buy a new home or a car, to do what 
is truly a part of the American dream; and that is to not consistently 
have government take away more of it. That has always been the great 
energy of our society.
  After Alan Greenspan was at the policy committee, I asked him about 
this phenomenon in the stock market and this high-tech economy. I said: 
How do you read this one, Mr. Greenspan? He said: I am not sure I can, 
other than to say the genius of the American people turned loose in a 
private marketplace is beyond imagination.
  Today we have seen that genius simply because we have reduced the 
level of intensity of government upon that genius. And we want to 
reduce it a little more. Of all the surplus moneys that will come 
rolling into government over the next 10 years, we are saying, for 
every dollar, we only want to give one quarter of it back--not all of 
it, one quarter of every dollar. Three quarters of it stays in 
government to shore up Social Security, to reform Social Security, to 
protect new and future Social Security recipients, to spend a little in 
selected areas when we find it necessary.
  Yet one would think, from listening to folks on the other side of the 
aisle, that this tax cut would destroy government as we know it. I 
heard a Democrat Senator the other day say it will destroy all the 
environmental programs; it will destroy all the educational programs; 
it will destroy all of the welfare programs. After listening to that, 
my only thought was: Get a life. Where are you coming from?
  We are talking surplus moneys, not current moneys. We are talking 
surplus moneys. We are only talking about giving a quarter of it back 
out of every dollar and keeping three quarters of it to do much of what 
that Senator was talking about.
  The reason that Senator was in such an illogical, untruthful panic 
was that over the August recess Republicans, led by the Senator from 
Georgia, went home to hold town meetings and press conferences and to 
visit with our taxpayers and our voters and explain the package. All of 
a sudden, the numbers started shifting because the national media 
didn't have control of the message. All of a sudden, the tax bill moved 
up into the high fifties and sixties as something the American people 
thought was probably the right thing to do. Still frustrated, they want 
the debt paid down. But when they found out that over the course of the 
life of this tax bill we pay down about $2 trillion in debt, they said 
that is fair and reasonable.

  Of course, when agricultural America, where the Senator from Georgia 
and I were visiting with our farmers, saw what we had done for them in 
farming and in the tax package to help production agriculture, they 
said that makes sense, that gives us tools to survive and to be 
productive.
  I am absolutely amazed this President blindly, without listening, 
reading, or sensing the character of the American people, but only the 
politics of his party, says ``veto'' from day 1, ``veto'' from day 2, 
``veto'' from day 3, instead of saying we have an opportunity to keep 
this economy growing to allow the private sector to thrive, to hold 
down the influence of government over the private sector, and, most 
importantly, allow the American family to pursue its dream.
  That is what this tax package is all about. It is all about the right 
things. It is about fairness, responsibility, helping people, and 
controlling government.
  I thank my colleague from Georgia for his leadership in this area, 
for helping send the messages out unfettered, clear and simple, to the 
American people so they can make up their own minds. They are making up 
their minds. It is very clear to me where they come down. They come 
down on the ``no spending'' side, and they come down on the side of 
splitting the differences between a tax cut and paying down the debt. 
That is right and responsible. I hope the President will listen as that 
bill comes to him this coming week.
  I yield the floor.
  Mr. LOTT. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative assistant proceeded to call the roll.
  Mr. LOTT. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Hagel). Without objection, it is so 
ordered.
  Mr. LOTT. Mr. President, I do have a series of requests that I will 
need to make. I have notified the Democratic leadership that we will be 
making these requests, and I believe Senator Dorgan is here to respond 
and perhaps comment on them.

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