[Congressional Record Volume 146, Number 12 (Thursday, February 10, 2000)]
[Senate]
[Pages S601-S603]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 FRAUD

  Mr. HOLLINGS. Mr. President, if people back home only knew. This 
whole town is engaged in the biggest fraud. Tom Brokaw has written that 
the greatest generation suffered the Depression, won the war, and then 
came back to lead. They not only won the war but were conscientious 
about paying for that war and Korea and Vietnam. Lyndon Johnson 
balanced the budget in 1969.
  I ask unanimous consent to print in the Record the record of all the 
Presidents, since President Truman down through President Clinton, of 
the deficit and debt, the national debt, and interest costs.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                           HOLLING'S BUDGET REALITIES
----------------------------------------------------------------------------------------------------------------
                                                                                                        Annual
                                    U.S. budget                 Unified       Actual                  increases
                                     (outlays)     Borrowed     deficit      deficit      National   in spending
        President and year              (In      trust funds   with trust    without        debt         for
                                     billions)    (billions)     funds     trust funds   (billions)    interest
                                                               (billions)   (billions)                (billions)
----------------------------------------------------------------------------------------------------------------
Truman:
    1946..........................         55.2         -5.0        -15.9        -10.9        271.0  ...........
    1947..........................         34.5         -9.9          4.0        +13.9        257.1  ...........
    1948..........................         29.8          6.7         11.8         +5.1        252.0  ...........
    1949..........................         38.8          1.2          0.6         -0.6        252.6  ...........
    1950..........................         42.6          1.2         -3.1         -4.3        256.9  ...........
    1951..........................         45.5          4.5          6.1         +1.6        255.3  ...........
    1952..........................         67.7          2.3         -1.5         -3.8        259.1  ...........
    1953..........................         76.1          0.4         -6.5         -6.9        266.0  ...........
    1954..........................         70.9          3.6         -1.2         -4.8        270.8  ...........
Eisenhower:
    1955..........................         68.4          0.6         -3.0         -3.6        274.4  ...........
    1956..........................         70.6          2.2          3.9         +1.7        272.7  ...........
    1957..........................         76.6          3.0          3.4         +0.4        272.3  ...........
    1958..........................         82.4          4.6         -2.8         -7.4        279.7  ...........
    1959..........................         92.1         -5.0        -12.8         -7.8        287.5  ...........
    1960..........................         92.2          3.3          0.3         -3.0        290.5  ...........
    1961..........................         97.7         -1.2         -3.3         -2.1        292.6  ...........
    1962..........................        106.8          3.2         -7.1        -10.3        302.9          9.1
Kennedy:
    1963..........................        111.3          2.6         -4.8         -7.4        310.3          9.9
    1964..........................        118.5         -0.1         -5.9         -5.8        316.1         10.7
Johnson:
    1965..........................        118.2          4.8         -1.4         -6.2        322.3         11.3
    1966..........................        134.5          2.5         -3.7         -6.2        328.5         12.0
    1967..........................        157.5          3.3         -8.6        -11.9        340.4         13.4
    1968..........................        178.1          3.1        -25.2        -28.3        368.7         14.6
    1969..........................        183.6          0.3          3.2         +2.9        365.8         16.6
    1970..........................        195.6         12.3         -2.8        -15.1        380.9         19.3
Nixon:
    1971..........................        210.2          4.3        -23.0        -27.3        408.2         21.0
    1972..........................        230.7          4.3        -23.4        -27.7        435.9         21.8
    1973..........................        245.7         15.5        -14.9        -30.4        466.3         24.2
    1974..........................        269.4         11.5         -6.1        -17.6        483.9         29.3
    1975..........................        332.3          4.8        -53.2        -58.0        541.9         32.7
Ford:
    1976..........................        371.8         13.4        -73.7        -87.1        629.0         37.1

[[Page S602]]

 
    1977..........................        409.2         23.7        -53.7        -77.4        706.4         41.9
Carter:
    1978..........................        458.7         11.0        -59.2        -70.2        776.6         48.7
    1979..........................        503.5         12.2        -40.7        -52.9        829.5         59.9
    1980..........................        590.9          5.8        -73.8        -79.6        909.1         74.8
    1981..........................        678.2          6.7        -79.0        -85.7        994.8         95.5
Reagan:
    1982..........................        745.8         14.5       -128.0       -142.5      1,137.3        117.2
    1983..........................        808.4         26.6       -207.8       -234.4      1,371.7        128.7
    1984..........................        851.8          7.6       -185.4       -193.0      1,564.7        153.9
    1985..........................        946.4         40.5       -212.3       -252.8      1,817.5        178.9
    1986..........................        990.3         81.9       -221.2       -303.1      2,120.6        190.3
    1987..........................      1,003.9         75.7       -149.8       -225.5      2,346.1        195.3
    1988..........................      1,064.1        100.0       -155.2       -255.2      2,601.3        214.1
    1989..........................      1,143.2        114.2       -152.5       -266.7      2,868.3        240.9
Bush:
    1990..........................      1,252.7        117.4       -221.2       -338.6      3,206.6        264.7
    1991..........................      1,323.8        122.5       -269.4       -391.9      3,598.5        285.5
    1992..........................      1,380.9        113.2       -290.4       -403.6      4,002.1        292.3
    1993..........................      1,408.2         94.3       -255.0       -349.3      4,351.4        292.5
Clinton:
    1994..........................      1,460.6         89.2       -203.1       -292.3      4,643.7        296.3
    1995..........................      1,514.6        113.4       -163.9       -277.3      4,921.0        332.4
    1996..........................      1,453.1        153.5       -107.4       -260.9      5,181.9        344.0
    1997..........................      1,601.2        165.9        -21.9       -187.8      5,369.7        355.8
    1998..........................      1,651.4        179.0         70.0       -109.0      5,478.7        363.8
    1999..........................      1,704.5        250.5        122.7       -127.8      5,606.5        353.5
    2000..........................      1,769.0        234.5        176.0        -58.5      5,665.0        362.0
    2001..........................      1,839.0        262.0        177.0        -85.0      5,750.0        371.0
----------------------------------------------------------------------------------------------------------------
* Histocial Tables, Budget of the US Government FY 1998; Beginning i CBO'S 2001 Economic and Budget
  Outlook.

  Mr. HOLLINGS. Mr. President, Lyndon Johnson balanced the budget in 
1969. At that time, the national debt was $365 billion with an interest 
cost of only $16 billion. Now, under a new generation without the cost 
of a war, the debt has soared to $5.6 trillion with annual interest 
costs of $365 billion. That is right. We spend $1 billion a day for 
nothing. It does not buy any defense, any education, any health care, 
or highways. Astoundingly, since President Johnson balanced the budget, 
we have increased spending $349 billion for nothing.
  Early each morning, the Federal Government goes down to the bank and 
borrows $1 billion and adds it to the national debt. We have not had a 
surplus for 30 years. Senator Trent Lott, commenting on President 
Clinton's State of the Union Address, said the talk cost $1 billion a 
minute. For an hour-and-a-half talk, that would be $90 billion a year. 
Governor George W. Bush's tax cut costs $90 billion a year. Together, 
that is $180 billion. Just think, we can pay for both the Democratic 
and Republican programs with the money we are spending on interest and 
still have $185 billion to pay down the national debt. Instead, the 
debt increases, interest costs increase, while all in town, all in the 
Congress, shout: Surplus, surplus, surplus.
  Understand the game. Ever since President Johnson's balanced budget, 
the Government has spent more each year than it has taken in--a 
deficit. The average deficit for the past 30 years was $175 billion a 
year. This is with both Democratic and Republican Presidents and 
Democratic and Republican Congresses. Somebody wants to know why the 
economy is good? If you infuse $175 billion a year for some 30 years 
and do not pay for it, it ought to be good.
  The trick to calling a deficit a surplus is to have the Government 
borrow from itself. The Federal Government, like an insurance company, 
has various funds held in reserve to pay benefits of the program--
Social Security, Medicare, military retirement, civilian retirement, 
unemployment compensation, highway funds, airport funds, railroad 
retirement funds.
  Mr. President, I ask unanimous consent to print in the Record a list 
of trust funds looted to balance this budget.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

 
------------------------------------------------------------------------
                                            1998       1999       2000
------------------------------------------------------------------------
Social Security........................        730        855      1,009
Medicare:
    HI.................................        118        154        176
    SMI................................         40         27         34
Military Retirement....................        134        141        149
Civilian Retirement....................        461        492        522
Unemployment...........................         71         77         85
Highway................................         18         28         31
Airport................................          9         12         13
Railroad Retirement....................         22         24         25
Other..................................         53         59         62
                                        --------------------------------
      Total............................      1,656      1,869      2,106
------------------------------------------------------------------------

  Mr. HOLLINGS. Mr. President, these funds are held in trust for the 
specific purpose for which the taxes are collected.
  Under corporate law, it is a felony to pay off the company debt with 
the pension fund. But in Washington we pay down the public debt with 
trust funds, call it a surplus, and they give us the ``Good 
Government'' award.
  To make it sound correct, we divide the debt in two: The public debt 
and the private debt. Of course, our Government is public, and the law 
treats the debt as public without separation. The separation allows 
Washington politicians to say: We have paid down the public debt and 
have a surplus. There is no mention, of course, that the Government 
debt is increased by the same amount that the public debt is decreased. 
It is like paying off your MasterCard with your Visa card and saying 
you do not owe anything. Dr. Dan Crippen, the Director of the 
Congressional Budget Office, describes this as ``taking from one pocket 
and putting it in the other.''
  For years we have been using the trust funds to report a unified 
budget and a unified deficit. This has led people to believe the 
Government was reporting net figures. It sounded authentic. But as the 
unified deficit appeared less and less, the national debt continued to 
increase. While the unified deficit in 1997 was $21.9 billion, the 
actual deficit was $187.8 billion. In 1998 the unified budget reported 
a surplus of $70 billion, but actually there was a deficit of $109 
billion. In 1999 the ``unified surplus'' was $124 billion, but the 
actual deficit was $127.8 billion.
  Now comes the Presidential campaign. Social Security is a hot topic. 
Both parties are shouting: Save Social Security. Social Security 
lockbox. The economy is humming, booming. With high employment, the 
Social Security revenues have increased. It appears that, separate from 
Social Security, there will be enough trust fund money to compute a 
surplus. We have reached the millennium--Utopia--enough money to report 
a surplus without spending Social Security.
  Washington jargon now changes. Instead of a ``unified budget,'' the 
Government now reports an ``on-budget'' and an ``off-budget.'' This is 
so we can all call it an on-budget surplus, meaning without Social 
Security. But to call it an on-budget surplus, the Government spends 
$96 billion from the other trust funds.
  We ended last year with a deficit of $128 billion--not a surplus. The 
President's budget just submitted shows an actual deficit each year for 
the next 5 years. Instead of paying down the debt, the President shows, 
on page 420 of his budget, the debt increasing from the

[[Page S603]]

year 2000 to the year 2013--$5.686 trillion to $6.815 trillion, an 
increase of $1.129 trillion.
  They are all talking about paying off the debt by 2013, and the 
actual document they submit shows the debt increasing each year, and 
over that period an increase of over $1 trillion.
  Each year, Congress spends more than the President's budgets. There 
is no chance of a surplus with both sides proposing to reduce revenues 
with a tax cut. But we have a sweetheart deal: The Republicans will 
call a deficit a surplus, so they can buy the vote with tax cuts; the 
Democrats will call the deficit a surplus, so they can buy the vote 
with increased spending. The worst abuse of campaign finance is using 
the Federal budget to buy votes.
  Alan Greenspan could stop this. He could call a deficit a deficit. 
Instead, appearing before Congress in his confirmation hearing, 
Greenspan, talking of the Federal budget, stated: ``I would fear very 
much that these huge surpluses . . .'' and on and on. We are in real 
trouble when Greenspan calls huge deficits ``huge surpluses.'' 
Greenspan thinks his sole role is to protect the financial markets. He 
does not want the U.S. Government coming into the market borrowing 
billions to pay its deficit, crowding out private capital, and running 
up interest costs.
  But Congress' job is to not only protect the financial markets but 
the overall economy. Our job, as the board of directors for the Federal 
Government, is to make sure the Government pays its bills. In short, 
our responsibility is to eliminate waste.

  The biggest waste of all is to continue to run up the debt with 
devastating interest costs for nothing. In good times, the least we can 
do is put this Government on a pay-as-you-go basis. Greenspan's limp 
admonition to ``pay down the debt'' is just to cover his backside. He 
knows better. He should issue a clarion call to stop increasing the 
debt. While he is raising interest rates to cool the economy, he should 
categorically oppose tax cuts to stimulate it.
  Our only hope is the free press. In the earliest days, Thomas 
Jefferson observed, given a choice between a free government and a free 
press, he would choose the latter. Jefferson believed strongly that 
with the press reporting the truth to the American people, the 
Government would stay free.
  Our problem is that the press and media have joined the conspiracy to 
defraud. They complain lamely that the Federal budget process is too 
complicated, so they report ``surplus.'' Complicated it is. But as to 
being a deficit or a surplus is clear cut; it is not complicated at 
all. All you need to do is go to the Department of the Treasury's 
report on public debt. They report the growth in the national debt 
every day, every minute, on the Internet at 
``www.publicdebt.treas.gov.''
  In fact, there is a big illuminated billboard on Sixth Avenue in New 
York that reports the increase in the debt by the minute. At present, 
it shows that we are increasing the debt every minute by $894,000. 
Think of that--$894,000 a minute. Of course, increase the debt, and 
interest costs rise. Already, interest costs exceed the defense budget. 
Interest costs, like taxes, must be paid. Worse, while regular taxes 
support defense, and other programs, interest taxes support waste. 
Running a deficit of over $100 billion today, any tax cut amounts to an 
interest tax increase--an increase in waste.
  If the American people realized what was going on, they would run us 
all out of town.
  Mr. President, I thank the distinguished Chair 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. BAUCUS. I ask unanimous consent that the order for the quorum 
call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BAUCUS. Mr. President, I ask unanimous consent to speak as in 
morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________