[Congressional Record Volume 146, Number 117 (Wednesday, September 27, 2000)]
[House]
[Page H8282]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             UNIFIED BUDGET

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Maryland (Mr. Bartlett) is recognized for 5 minutes.
  Mr. BARTLETT of Maryland. Mr. Speaker, I just wanted to spend a few 
minutes talking about some terminology associated with the debt. There 
are a lot of terms that are used.
  I hear terms like the ``public debt,'' the ``trust fund debt,'' the 
``national debt.'' The other day I heard someone say ``Federal debt.''
  What are all these debts, and how do they relate to each other?
  Before we can talk about debt, though, we have to talk a little bit 
about the balanced budget and what the balanced budget means.
  The budget that we had hoped to balance and have balanced, as a 
matter of fact, is the unified budget. The unified budget is all the 
money that comes into Washington and all the money that leaves 
Washington, and that budget is balanced.
  But about 10 percent of the money that comes into Washington should 
not be Washington's money to spend because a big percent of that is 
monies that come from the American people taken from them presumably to 
be put in trust for them.
  The two biggest trust funds are the Social Security trust fund and 
the Medicare trust fund.
  But in the unified budget, which looks at all the money that comes 
into Washington and all the money that leaves Washington, we take that 
trust fund money, we took it all up in the lockbox for Social Security 
and now the lockbox for Medicare, we took all that money and spent it.
  And what is in the trust fund is not money. There are IOUs in there. 
And it is a very special IOU. It is an IOU; it is a non-negotiable U.S. 
security.

                              {time}  1430

  Although the Social Security trust fund should have about $900 
billion in it and the total trust fund should have roughly double that 
in it, there is in fact no money in the trust funds. All that is in the 
trust funds is IOUs.
  In the past years when we were running a $300 billion deficit, the 
real deficit in terms of accounting for the trust funds which we took 
and spent, the real deficit would have been about $160 billion more 
than that.
  What we have done is just phenomenal. At the beginning of this 
administration, the President never thought that we could balance the 
budget, and he was showing $300 billion deficits which were really $460 
billion deficits if we account for the trust fund. He was showing those 
out as far as the eye could see. When we balanced the unified budget, 
the total debt, the national debt, continued to go up. If you will look 
at national debt figures, you will see that they went up.
  Now, let us come to the debt and what we are doing today. What we are 
doing today is paying down the publicly held debt. The publicly held 
debt is the Wall Street debt. It is the debt which is owed to people 
who have bought bonds and securities, government bonds and securities 
and so forth. That publicly held debt represented, or it did until we 
started paying it down, we are now paying it down, represented about 
two-thirds of the total debt and the other debt was the trust fund 
debt. We are now paying down the publicly held debt but we are doing 
that largely with moneys from the trust funds, so as we pay down the 
publicly held debt, we are accumulating an equivalent amount of trust 
fund debt, which would mean that, all things being equal, the national 
debt or the total debt would stay at exactly the same figure. But all 
things are not equal and the truth of the matter is that at least for 
the next couple of years or so, the national debt, which is the total 
debt, will continue to go up a little. If this roaring economy 
continues, we will in fact have a true surplus and the total debt, the 
national debt, will begin to go down.
  What we are doing is very advantageous and it is what we ought to do, 
because as we pay down the publicly held debt, the Federal Government 
is competing less for dollars, which means that interest rates will 
drop, and we expect interest rates to drop by about 2 percent. That is 
great good news if you are buying a home or buying a car or putting 
your kid through college. But the flip side of that is that as we pay 
down that publicly held debt, we are, and by law we can do nothing else 
but invest the moneys in these nonnegotiable U.S. securities.
  We are driving up the trust fund debt. That trust fund debt now 
becomes a liability. We will not have to pay that. I will not. But my 
kids and my grandkids are going to have to pay that money. And starting 
about 2012 or 2013 or 2014 depending upon your projections the way our 
economy is going, not enough money will come in Social Security to meet 
the obligations, and we are going to have to go to the trust fund. 
There is no money there. There is only IOUs there. And so we are going 
to have to borrow the money to make good on that. It is great good news 
for the present, but we must really do something about Social Security 
or it is not all that great good news for our children and our 
grandchildren.

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