[Congressional Record Volume 146, Number 11 (Wednesday, February 9, 2000)]
[Senate]
[Pages S514-S515]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          A COMMONSENSE BUDGET

  Mr. BAUCUS. Mr. President, I want to take a few moments to focus on 
the budget debate in which this Congress is engaged. It is very 
important at the beginning to set priorities and parameters as we put a 
budget together that makes sense for our country rather than treating 
in isolation each individual spending or tax matter that comes before 
this body. It is very important that we step back and look at the 
bigger picture.
  When a family or a corporation puts together a budget, they have to 
make all of their needs and desires fit into an overall budget plan. In 
the same way we should start out by making sure that all of our 
individual proposals fit into an overall budget plan.
  I say this because some Members of the House are going to be moving 
specific tax bills in advance, without looking at the overall budget. 
The problem, obviously, is if we take very tempting separate items, 
such as a tax bill, say, a marriage penalty, or maybe it is an 
education tax bill, perhaps a retirement savings tax bill--it is very 
tempting to pass these in isolation and we are picking and choosing 
between different tax cuts before we even have agreed on how much money 
we have available.
  Let's not put the cart before the horse. It's the same kind of 
helter-skelter approach that got us deeply into debt in the first 
place. Let's set our budget priorities first.
  As we do so, we should keep two points in mind. First, we should be, 
if I may use the word, conservative. Let's keep the cork in the 
champagne and not put too much stock in ten-year projections that show 
a huge surplus.
  I don't care how good your crystal ball is. Things change, and small 
changes add up to a lot over 10 years.
  I would like to make a point about an article in yesterday's 
Washington Post that underlines this problem. It is a story by Eric 
Pianin and John Berry. Their basic point is the fragility of the long-
term budget projections--whether they are the President's projections, 
the CBO's, or others.
  Let me quote, ``Clinton's projections highlight just how tenuous 
those surpluses could be.''
  There is another example of this. This chart shows how difficult it 
is to predict the future and how quickly and how dramatically budget 
projections change. On the left, the red bar illustrates that 2 years 
ago, January 1998, the Congressional Budget Office projected the 
country would face about a $900 billion deficit over the next 10 years.
  Just a couple of weeks ago, the CBO reached a different conclusion. 
Their conclusion was that we are going to have the benefit of a roughly 
$2 trillion budget surplus over the next 10 years. That is a swing of 
practically $3 trillion in just two years! Clearly, 2 years from now 
this $2 trillion projected surplus is going to look a lot different, as 
it will 3 years from now and 4 years from now. Therefore, let us not 
listen to the siren song of these huge projected surpluses based upon 
current economic estimates. I know the budget estimators do the best 
they can. But I sure wouldn't want to bet the farm that these new 
numbers will hold up for a decade.
  The current economy is doing well. We want it to continue doing well, 
but there is no guarantee it will. Let's be careful. Let's be cautious. 
These projections of huge surpluses could fade. It could change very 
quickly.
  The point came home to me in a conversation I had with the CEO of a 
major telecommunications company.
  I said: Sir, does your company make 5-year plans?
  He said: Well, yes, we do.
  I said: How closely do you follow them? How well do you implement 
them?
  He said: Well, we really don't. We try, but things change so quickly, 
we have to change and adjust.
  Granted, telecommunications is a fast-changing industry. But we are a 
fast-changing country in many respects. Changes happen very quickly. 
Changes happen, particularly as our world gets more and more 
interconnected and more technologically advanced. With more and more 
technology and more factors involved in determining the course of our 
economy, it is more and more difficult to predict the future. It is a 
problem we face.
  With all the inherent uncertainty about the future, let's be a little 
cautious when it comes to the Federal budget. And let's also adhere to 
the Hippocratic Oath, that is, ``first, let's do no harm.''
  I believe the prudent course is to adopt what I'd call a ``no 
regrets'' budget.
  Policies that we believe make sense and address important needs 
irrespective of upticks or downticks in the economy.
  To my mind, this means we should, first and foremost, reduce the 
debt.

[[Page S515]]

  That's plain conservative, common sense. During good times, you pay 
your debts, and you save a little. It also helps to protect Social 
Security and Medicare. Just paying down the debt will have a tremendous 
economic benefit to our country.
  How? First, paying down the debt will free up more private capital so 
individual Americans can make more decisions along the lines they want, 
as they have in the last several years, which has helped boost this 
great economic growth. Paying down the debt means more private capital 
will be available. But perhaps more importantly, if the Federal 
government borrows less from the market, the private sector can borrow 
more. Government reduces its debt service costs and pressure on 
interest rates is reduced. And lower interest rates are a direct, 
tangible benefit to every businessman, farmer, home owner, and car 
purchaser.
  Treasury Secretary Larry Summers said much the same thing yesterday 
morning. He told the Finance Committee that a major benefit of reducing 
the debt is to free money so that it is available to be productively 
invested by the private sector.
  So, Mr. President, reducing the Federal debt is important to the 
continued growth of the private sector.
  The second step is to set the right budget priorities. After debt 
reduction, we should invest where it will make the most sense for our 
economy. That means investment in people, investment in education, 
investment in infrastructure.
  We can also do some good by creating incentives for private 
retirement savings. Retirees need more than just Social Security and we 
should address it this year.
  And we should deal with other tax issues, too. These include reducing 
the marriage penalty, providing incentives for long-term health care, 
and helping communities conserve open space.
  Those are all areas where I believe we can find strong bipartisan 
agreement.
  I hope we could also find agreement not to go overboard with tax 
cuts. I know election years get the juices flowing. But I would just 
caution folks to remember our experience in the early 1980's with the 
exuberance for large tax cuts.
  Two years after we enacted that tax cut--and I voted for it--Senator 
Dole had to come back and lead the damage control party. We had to 
increase taxes that year to repair the deficit problem. But it wasn't 
enough and we needed to do it again two years after that.
  I don't know about my colleagues, but I've learned from that mistake. 
I don't want to lock in a big tax cut now only to find ourselves in two 
years digging out of a hole if the economy heads south. It's happened 
before!
  Mr. President, I know that many observers have written off this year. 
They say it's an election year. That we won't get anything done. But we 
shouldn't write off this year quite yet. We have 120 legislative days 
left. It's not a lot of time.
  But if we set solid budget priorities and we work together, then we 
can pass a budget that is responsible and invests in America, then this 
Congress can write a record of bipartisan accomplishment that will 
benefit all Americans.
  I ask my colleagues to join together. If we do what is right--and we 
know what is right--we are going to be serving our country well. That 
is my plea.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. MURKOWSKI. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Hutchinson). Without objection, it is so 
ordered.

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