Congressional Record, Volume 146 Issue 117 (Wednesday, September 27, 2000)

[Congressional Record Volume 146, Number 117 (Wednesday, September 27, 2000)]
[House]
[Pages H8293-H8300]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

VICE PRESIDENT'S ECONOMIC PLAN

The SPEAKER pro tempore. Under the Speaker's announced policy of
January 6, 1999, the gentleman from Texas (Mr. Armey) is recognized for
60 minutes as the designee of the majority leader.
Mr. ARMEY. Mr. Speaker, a few of my colleagues will soon be joining
me and we will be spending the next hour discussing the details of the
Vice President's economic plan. Certainly during that period of time we
will have a broad overview, but at this point I would like to just
focus very narrowly on one aspect of the Vice President's plan.
My colleagues may recall, Mr. Speaker, that the Vice President was
one of many voices that urged the President of the United States to
veto the marriage penalty tax relief that was passed by this Congress
and sent to the President. Soon after the President vetoed the marriage
penalty tax relief, the Vice President announced that he would give
marriage penalty relief by doubling the standard deduction.
Mr. Speaker, I think it is probably worth our while to realize what
this means exactly in terms of the Vice President's claim that it is
marriage penalty tax relief; certainly what it means by way of
comparison with the marriage penalty tax relief that was granted by
this Congress and vetoed by the President.
The first thing my colleagues should realize is that in the
congressional bill, written by the Republicans and passed on to the
President, vetoed by the President, all married couples, irrespective
of their filing status, received relief from the unfair marriage
penalty. The Vice President's proposal that he now outlines only gives
relief to those people who do not itemize their taxes.
If a couple owns a home and decides to deduct their mortgage
interest, they will get no marriage penalty relief under the Vice
President's plan. If a couple gives to their church and deducts
charitable contributions, they get no marriage penalty relief under the
Vice President's plan.

{time} 1600

If you, your spouse, or your child is ill and you deduct your
skyrocketing medical bills, you get no marriage penalty relief under
the Vice President's plan. If you or your spouse work at home and
deduct the cost of a home office, you get no marriage penalty relief
under the Vice President's plan. And, Mr. Speaker, if you jump through
hoops to become eligible for one of the new credits that the Vice
President has proposed, complicating our Tax Code even further than it
is now, than the Vice President will not give you relief from the
unfair marriage penalty. And, Mr. Speaker, that is wrong.
Mr. Speaker, that is just the beginning of the serious concern I have
with the details of the Vice President's plan.
Let me say, Mr. Speaker, it is a commonplace observation in this town
that the devil is in the details. Armey's axiom is, if you make a deal
with the devil, you are the junior partner. And I am about to
demonstrate in this next hour that indeed the devil that we do not want
to make a deal with is in the details of the Vice President's plan.
Let us take a look at the big picture first. The Vice President would
spend the on-budget surplus, he would rob the Social Security trust
fund, and he would provide a measly tax cut designed to manipulate
behavior instead of giving meaningful tax relief.
Madam Speaker, one of the things that we are very proud of in this
Congress, one of the things that we have been able to do, thanks
primarily to the success of the American people in creating an enormous
economic success story here in America and the revenues that have
accrued to the Government out of our economic success, is that we have
managed to stop the raid on Social Security.
Not only do we set aside 100 percent of all Social Security tax
dollars that people find in their payroll stubs as FICA tax, 100
percent of all Medicare tax surpluses set aside by this Congress, thus
ending the 40-year raid on Social Security and Medicare; but we have
even managed in this Congress to set aside a large portion of the on-
budget budget surplus.
What is the on-budget budget surplus? That is the part of the budget
surplus that accrues to the Government from your Social Security taxes,
not from your Medicare taxes, but from your income taxes. So that we
are now setting 90 percent of all budget surplus aside for debt
reduction.
The Vice President's plan would take all of that income tax surplus,
which we call on-budget surplus, and he would spend it. But worse than
that, he would renew the old practice, a practice that should be
forgotten, of robbing from the Social Security trust fund for new risky
spending schemes that we will talk about later.
At the same time, he would provide a bureaucratic government-run
prescription drug plan that is not guaranteed to bring the cost of
drugs down. Indeed, Madam Speaker, the Vice President's one-size-fits-
all, you-must-join-the-Government plan threatens to force the price of
prescription drugs up.
Let us address his spending plans first.
According to Vice President Gore's numbers, he would increase Federal
spending by about $900 billion through the year 2010. However, the
Senate budget committee shows a much higher price tag. They added up
the numbers and found that the Vice President would spend $2.1 trillion
of new spending and he would not stop there.
Think of it this way: the Vice President's plan is 191 pages. That
means that each page of his book would cost taxpayers an amazing $18.4
billion per page. It means that for every dollar by which the Vice
President would cut taxes, he would spend $6.75.
If you look at the details, Madam Speaker, we find that Vice
President Gore dramatically underestimates the cost of his new
retirement entitlement program built on top of the Social Security
program. That is not new. This has been a part of our problem
historically in the past with Democrat Congresses that created new
mandatory spending programs and dramatically underestimated their cost.
The Vice President says his new retirement program, which is very
similar to the Clinton universal savings account, which was a trial
balloon which the Clinton administration floated until it popped, that
this would cost $200 billion over 10 years.
But an analysis by Dr. John Colgen of Stanford University shows that,
if everyone eligible to participate in it, it would cost $160 billion
in the first year alone. The Vice President says his plan would cost
$200 billion over 10 years. Professor Colgen of Stanford University
says, if everybody eligible participated, it would be $160 billion for
the first year alone.
The Vice President mistakenly calls this brand new massive retirement
spending program a tax cut.
True enough, it would be run through the IRS and that would give this
agency still more power and control over

[[Page H8294]]

the lives of Americans. But this is no tax cut. Instead, the Vice
President would give government checks to people, some of whom do not
even pay taxes. Our budget rules would score it on the spending side,
not on the tax side.
Other parts of this Big Government agenda include massive new
spending on energy, environment, transportation and crime, all
important items on our policy agenda. But to pay for this, the Vice
President would rob the Social Security system.
Madam Speaker, we have stopped that raid on Social Security; and I
believe that the American people would agree with me, there is no going
back.
Madam Speaker, I see the gentleman from Wisconsin (Mr. Ryan), one of
our brighter and younger newer Members of the Republican Caucus, has
joined me; and I see he has some very interesting graphs there. So,
Madam Speaker, I yield to Professor Ryan so that he can help us look
into this case even further.
Mr. RYAN of Wisconsin. Madam Speaker, I thank the gentleman from
Texas (Mr. Armey) for yielding to me, and I appreciate his leadership
on this issue.
I also serve on the House Committee on the Budget. We actually spend
a great deal of time crunching these numbers, looking at the surplus,
and evaluating the different plans that come through Washington that
are being proposed.
What we have done through the Senate budget committee's analysis is
look at the different proposals, looked at what Governor Bush is
proposing to do with the Government's surplus, looked at what Vice
President Gore is proposing to do with the surplus. And as we did an
apples-to-apples comparison and took a look at the priorities, it is a
pretty stark difference.
One of the things that I have heard as I have gone around my
district, which is the First Congressional District in Wisconsin, is we
talked to a lot of people about this election and the thing that really
gets to me sometimes that I hear is that some people think there is not
much of a difference, that there is no difference between who they pick
in Washington.
Well, I have got to tell my colleagues, of all the elections, this
election is clearing about differences. The differences between the
visions for America as proposed by Al Gore and George Bush are worlds
apart from each other.
To quickly summarize it, the Vice President wants to take the hard-
earned surplus, and the surplus by definition are people overpaying
their taxes, the Vice President wants to keep it in Washington. He
wants to spend it on new government programs. Governor Bush wants to
pay off our debt, protect Social Security and Medicare, and give us our
money back as we continue to overpay our taxes.
But let us not just listen to me. Let us take a look at the hard
numbers. I have here a chart that breaks up the surplus dollars. It
basically says, for every one dollar coming into Washington in
government surplus, how does each plan spend that money, how does each
plan treat that money?
Well, if we look at Vice President Gore's plan, 46 cents of every
surplus dollar is committed to new government spending. On the
contrary, in the Bush plan, 6 cents of all surplus dollars are
committed to new spending.
What about preserving Social Security, Medicare, and paying off our
national debt? A lot of them serve the same purpose. Paying off our
debt helps us preserve Social Security and Medicare.
The Bush plan commits 58 cents of every surplus dollar over the next
10 years toward preserving Social Security and paying off the debt and
shoring up Medicare. The Gore plan commits 36 cents of every surplus
dollar.
What about tax relief? This is the lowest priority in the Gore
budget. Vice President Gore is saying that, for every surplus dollar
coming into Washington, Americans, after they overpay their taxes,
should only get 7 cents of that dollar back.
Governor Bush is saying 29 cents of every surplus dollar should be
returned back to the taxpayer after dedicating 58 cents back towards
Social Security and Medicare and paying off the debt.
And increased interest costs, something that we have to do to manage
the interest, the balance payments, 11 cents for Gore, 7 cents for
Bush. That basically means that the Vice President is paying off debt
at a slower pace. The Vice President, if all of his new spending plans
get enacted, will likely wind us up into the point where we will have
to dip into the Social Security trust fund.
If you want to take a look at what the difference is in plans over
the surplus are, just take a look at who wants to spend money and who
wants to save the money.
Vice President Gore is proposing the greatest expansion of the
Federal Government in 30 years. He is proposing to take $2.1 trillion
of the surplus and spend it on new programs here in Washington. To the
contrary, Governor Bush is saying let us spend $278 billion on needed
things in Washington, such as committing ourselves to the fundamental
problems we have in this country, funding the education unfunded
mandates, funding our critical needs in health care, rebuilding our
national defenses.
When it comes down to it, it is basically this: the Vice President
wants to spend the surplus in Washington, the greatest expansion of the
Federal Government in 30 years, at the expense of Social Security and
Medicare and paying off our debt.
Governor Bush is saying this: here is the priority of how we deal
with the surplus. Pay off our national debt, shore up Social Security
and Medicare. And if people still continue to overpay their taxes to
Washington, give them their money back rather than spend it on new
programs in Washington.
That is what Bush is proposing. And there is a huge world of
difference between these two men running for President and their
visions for America with respect to how they treat our surpluses.
Mr. ARMEY. Madam Speaker, reclaiming my time, I would like to look at
that graph. You notice in this graph on the Bush proposal that Governor
Bush proposes 29 cents out of that dollar for tax relief. And I notice
that you see Vice President Gore is proposing 7 cents.
Mr. RYAN of Wisconsin. That is right.
Mr. ARMEY. But is it not true that the Vice President is proposing 85
new tax increases?
Mr. RYAN of Wisconsin. That is correct.
Mr. ARMEY. And 36 targeted tax cuts? So that 7 cents is really a net
tax.
Mr. RYAN of Wisconsin. That is right.
Mr. ARMEY. Madam Speaker, I ask, does the gentleman from Wisconsin
(Mr. Ryan) know how many tax increases are being proposed by Governor
Bush?
Mr. RYAN of Wisconsin. Madam Speaker, it is my understanding that he
is not proposing any tax increases at all.
Mr. ARMEY. Madam Speaker, the understanding of the gentleman is
absolutely correct. And I appreciate that.
I hope the gentleman from Wisconsin (Mr. Ryan) can stay around, and
maybe we can talk some more.
But, Madam Speaker, we have also been joined here by the gentleman
from Michigan (Mr. Hoekstra) on the Committee on Education and the
Workforce. And when we start talking about our responsibilities here in
Washington, certainly we can take a look at big-picture items, what are
our broad-based plans for the creation of new programs, all the new
programs the Vice President would like to create, whether or not we
would like to cut taxes, or whether or not we will keep our commitment
to America to stop the raid on Social Security and pay down the debt.
But in doing that, we also have an administrative responsibility.
Now, the Vice President has been a key member of the Clinton
administration for 8 years; and during those 8 years, he accepted the
responsibility for doing what he called reinventing government, the
idea being that he was going to make the agencies of this government
administratively work efficiently, effectively, and be cost effective
on behalf the American people.
The gentleman from Michigan (Mr. Hoekstra) from the Committee on
Education and the Workforce has spent a good deal of time examining
just what is the record of performance of the agencies of the Federal
Government under the stewardship of the

[[Page H8295]]

Clinton/Gore administration and especially in light of the enormous
amount of applause this Nation has given the Vice President for his
efforts to bring, what should I say, common sense good business
practices to government.
I wonder if I yield to the gentleman, maybe he would share with us
some of his discoveries along those lines.
Madam Speaker, I yield to the gentleman from Michigan (Mr. Hoekstra).

{time} 1615

Mr. HOEKSTRA. I thank the gentleman for yielding. I think this really
builds off of the discussion that our colleague from Wisconsin was just
leading in that when we take a look at the Vice President's plans to
significantly increase spending, before we significantly increase
spending anywhere, we ought to take a look at how we are spending the
$1.7, $1.8 trillion that we currently collect and we hand over to the
executive branch and say, ``How's it going?''
The majority leader is absolutely right. This is the publication that
came out on September 7, 1993, it came from the Vice President, signed
by Mr. Gore. The book is, From Red Tape to Results, Creating a
Government that Works Better and Costs Less.
It is the report of the National Performance Review, Vice President
Al Gore. He was clearly mandated by the President to lead this effort.
Where we are in the year 2000 is with this question, there are nine
departments whose books cannot be audited. They can be audited but the
auditors come back and say, ``We can't give you a clean audit.'' The
first one is the Department of Treasury. Think about this. The national
bank or whatever we want to call it, the Department of Treasury cannot
get a clean audit.
Mr. RYAN of Wisconsin. The gentleman is saying that we have nine
Cabinet departments that cannot pass an audit?
Mr. HOEKSTRA. I am not sure they are all Cabinet, but we have nine
significant agencies that cannot receive a clean audit.
Mr. RYAN of Wisconsin. What would happen if a small or medium-sized
business in Michigan or Texas or Wisconsin could not pass their audit
with the IRS?
Mr. HOEKSTRA. We actually had testimony from the accounting and the
investment field. We asked them if they knew of any $1.8 trillion or
even a $1 billion company publicly held in the last year, the last 2
years that had failed their audit to the extent that the Department of
Education had, where they have not had a clean audit for 2 years and do
not expect a clean audit for 3 more years and they said, ``We can't
think of one.'' Because what would happen if you were in the private
sector and the auditors failed your audit, most likely the value of the
stock would drop significantly immediately. The other thing that would
happen is most likely the Securities and Exchange Commission would
suspend the trading of your stock, because you could not with any
reasonable certainty go to your shareholders and indicate that what you
represent in your financial statements in any way reflects the real
world.
Let us take a look. The Treasury Department, Justice cannot get a
clean audit, Education, Defense, Ag, the EPA, HUD, OPM, AID. None of
these can receive a clean audit. I chair the Subcommittee on Oversight
for the Committee on Education and the Workforce. We miss the majority
leader on the committee. But he knows the work that we have done at
that committee in taking a look at exactly what is going on in the
Education Department.
In 1993, here is what the Vice President said: ``The Department of
Education has suffered from mistrust and management neglect almost from
the beginning. To overcome this legacy and to lead the way in national
educational reform, Ed must refashion and revitalize its programs,
management and systems.'' That is directly out of this book.
In 2000, here is what the General Accounting Office said: ``Serious
internal control and financial management system weaknesses continue to
plague the agency.''
In 1993, the Vice President said: ``The Department is redesigning its
core financial management systems to ensure that data from accounting,
grants, contracts, payments and other systems are integrated into a
single system.''
In 2000, here is what GAO said: ``Pervasive weaknesses in the design
and operation of Education's financial management systems, accounting
procedures, documentation, record keeping and internal controls
including computer security controls prevented Education from reliably
reporting on the results of its operations for fiscal year 1998.'' That
is also true for fiscal year 1999, and we are expecting that they will
again fail their audit for the year 2000.
Now, in the private sector when the auditors say you cannot keep your
books, we know that there are real consequences. Here are just some of
the examples of what is going on in our Department of Education. Most
of these are examples not from us in Congress but they are from the
General Accounting Office, they are from their own Inspector General,
and so these are well documented.
Congratulations, You're Not a Winner. In February, the Department of
Education notified 39 young people in America that they won the
prestigious Jacob Javits scholarship. My daughter just went to school
this fall, went to college, my first one in college, and a Jacob Javits
scholarship awards kids 4 years of graduate school at government
expense. Paying undergraduate bills, I can imagine how excited the kids
were and how excited the parents were. These kids were thrilled. Two
days later, they got a call back saying, ``Sorry, you're not the
winners.'' Poor management, real results, real impact.

In September of 1999, they printed 3.5 million financial aid forms.
This is what kids use to apply. They printed them incorrectly. A cost
of $720,000.
Mr. ARMEY. Does the gentleman mean the Department of Education
incorrectly printed financial aid forms for the students wishing to
apply for college to learn how they might correctly use the English
language?
Mr. HOEKSTRA. 3.5 million forms containing errors, incorrect line
references to the IRS tax form were printed, 100,000 of them were
distributed, had to be recalled, the other ones all had to be
destroyed. A cost of $720,000.
Dead and Loving It. The Department of Education improperly discharged
almost $77 million in student loans for borrowers who claimed to be
either permanently disabled or deceased. This was a double good news
for these people. The good news, number one, is that their loans were
forgiven because they were disabled or dead. The second bit of good
news is they were neither disabled nor dead. But the Education
Department had identified them as such and had forgiven their loans.
Most recently a theft ring, and this is what happens when you do not
have proper controls. They had a purchasing agent within the Department
of Education who could order materials, certify that they came in,
certify that they should be paid for and certify that other
individuals, independent contractors, should receive overtime. They
ordered over $330,000 of electronic equipment, authorized the payment,
the $330,000 of equipment was shipped around to various employees' and
friends' homes around the Nation's capital. This was all done through
the phone guy. What was in it for the phone guy? The phone guy got
$660,000 of overtime that he had not worked.
More recently, we had a hearing on this last week. Another theft
ring. Impact Aid funds. This is dollars that we send to needy school
districts or districts that have a lot of Federal facilities in them.
In this case, two school districts in South Dakota, actually I believe
on Indian reservations. The Department of Education wired them the
money, found out a couple of days later because a local car dealer had
somebody coming in and wanted to buy a Corvette, came in and were ready
to pay cash or a cashier's check to pay for the Corvette. The
dealership did a credit check on this individual and found out that it
did not check out. They called the FBI. They found out that this group
had bought a Lincoln Navigator, a Cadillac Escalade and they were
looking at buying a Corvette. They also bought a home, $135,000. So
somebody was checking this to see where did this money come from.
Somebody had gone into the computer systems at the Department of Ed,
and this is one of their other problems, they do not have computer
security,

[[Page H8296]]

and had changed the routing, so instead of sending this money to an
account into the school districts in South Dakota, the money went into
these individuals' accounts in Washington to the tune of $1.9 million.
Mr. ARMEY. If I may ask the gentleman, Madam Speaker, I want to
continue this with the gentleman from Michigan (Mr. Hoekstra) and I
certainly want to get back to my good friend the gentleman from
Wisconsin (Mr. Ryan) as well but I think it is very important that we
make this note. The gentleman from Michigan is the oversight chairman
of the subcommittee on education. It is his job to see to it that the
Education Department under the jurisdiction of his committee does a
good job. And the information we have here is about that committee. But
as the gentleman from Michigan pointed out, we have how many agencies
that are inauditable, they cannot be audited?
Mr. HOEKSTRA. We have nine significant agencies.
Mr. ARMEY. Nine significant agencies, including the Treasury
Department which I will bet has in its employ a more than generous
number of CPAs and they cannot be audited. So what happens, it seems,
is that when people come to Washington, they cannot even do what they
do do well. The CPAs malfunction at Treasury, the educators malfunction
in the Department of Education.
I want to make this point very quickly. Why are we being tough on the
Department of Education? It is not that we dislike the Department of
Education. It is certainly not that we dislike education. We would
stand here and we would say there is no thing that any culture can do
that can be more important than how we educate our children. And if we
have an agency of the Federal Government that is committed to that
purpose by an act of Congress, committed, then it is the responsibility
of Congress to see that that agency functions for the children. And to
find this kind of inefficiency, neglect, sloppy work, abuse, who pays
for that? That all translates into the neglected children from an
agency of this government that we created.
I would commend the gentleman from Michigan for his good work. I want
to hear more about his findings.
Mr. Speaker, we have with us the gentlewoman from North Carolina
(Mrs. Myrick), and she has agreed to participate but is on a very tight
schedule. I yield to our good friend the gentlewoman from North
Carolina.
Mrs. MYRICK. I appreciate the gentleman yielding. I just wanted to
make a couple of comments, not on education because the gentleman from
Michigan is covering that quite thoroughly and I am sure the gentleman
from Wisconsin is covering budget surplus information. But I wanted to
just mention a couple of things relative to Vice President Gore's
budget that he has presented, because I think there are some things
that we could point out that maybe do show a difference in the way that
we philosophically go about spending our government's money and the
people's money at home.
I know that the Vice President made the comment at the Democratic
National Convention that in the next 4 years he wanted to pay off all
the national debt we have accumulated over 200 years, and this would be
the plan that would put us on track for completely paying off debt by
2012. Then I remember back last year how President Clinton's
administration only wanted to save 63 percent of the surplus and if it
had not been for us really forcing the issue and saying that we are
going to lock away 100 percent of the surplus, we might not be in the
position today where those statements could even be made that we are
going to be able to save and pay off the debt.
I think we need to look at that. Plus the fact that the National
Taxpayers Union estimates that the Vice President's spending proposals
would actually increase government spending by $2.7 trillion. We do not
hear about the increase in spending that is being talked about. That is
more than the budget surplus for the next year. And that would send us
right back into the days of deficit spending where we do not want to
be. Then it also comes out to say that for every dollar that the Vice
President's budget would cut taxes, he would raise government spending
by $6.75. I am not a brilliant mathematician but that kind of tells me
that this is not going to work. You cannot on one hand cut taxes by a
dollar and then raise spending and expect that you are going to be in a
good financial position.
When we look at this proposal that has been put on the table, it does
closely mirror what the administration is also proposing. I think back
to 1995 because if my colleagues remember if we had adopted that
proposed budget, we would still have $200 billion in deficits today. It
was a lot of my colleagues here who forced this issue that we would
sign a balanced budget agreement. Remember that, back in 1995? I think
there were five budgets presented by the President before we finally
got to one that was agreeable that we could sign when we stood our
ground and said we are going to balance this budget.
Look at the results. The American people are definitely reaping the
results. We have worked hard to make this happen. We have turned the
tide. We really have turned the tide by all the policies, the things
that the gentleman from Michigan has been working on with all the
oversight that he has been doing, that has been going into it and what
we are talking about now with these generous surpluses that are really
the people's money that we want to give back to them, that we do not
want to keep here in Washington.
I think it is important that the American people do understand and
know that this would not have happened if we had not stuck to our guns
and really kept these policies in place. That is something that we need
to be doing for the future for our children and our grandchildren.
I appreciate all of my colleagues being here today to really share
this information with the American people, because otherwise they do
not hear. We do not say, they do not hear.

{time} 1630

Mr. ARMEY. I thank the gentlewoman. I would like to make this
observation: Listening to the gentlewoman from North Carolina, I am
reminded it takes leadership, and it takes cooperation, to really get
big jobs done in government. People must work together.
I have to say I am very proud of this record we have of working on
this very big issue of our budget. We said we were going to balance the
budget. The naysayers in this town said it could not be done. When we
got to that point, the President recognized it, and in fact when the
surplus began to emerge, he recognized that.
I remember the President said, ``I am going to commit 63 percent of
the Social Security revenues to debt reduction.'' We appreciated that
gesture on his part, but we said, ``How about 100 percent?'' Again, the
naysayers, they said it could not be done.
But we challenged the President to work with us. What we saw is when
you have a disciplined leadership and two agencies of the government,
the Congress and the White House, working together, we managed to
accomplish a 100 percent total stop of the raid.
Now, what we need is a new administration after these elections that
understands the fruits of that discipline and retains that commitment.
Here we have the Vice President saying, elect me to the Presidency and
I will start a new spending spree in Washington. I will introduce these
new high-risk spending schemes in Washington that promise to spend so
much that we will not only backslide on the accomplishments of this
Congress, but, more discouragingly, backslide on the accomplishments of
this Congress working together with this Presidency.
So he turns his back not only on the work of the Republicans in the
House and the Senate, but on the work of President Clinton, and says
never mind all that, I want to go back to large-scale, big risky
spending schemes.
I see the gentleman from Wisconsin would like to make a point, and I
also would like to get back to the gentleman from Michigan (Mr.
Hoekstra), I imagine he has more information here. We also have the
gentleman from Florida (Mr. Stearns) here.
Mr. RYAN of Wisconsin. I appreciate the majority leader. I was really
struck with what the gentlewoman from North Carolina (Mrs. Myrick) had
to say. It really is about priorities.
When you put together a budget, you are putting together a vision for
the

[[Page H8297]]

country. When you take a look at the good economic prosperity and times
we have enjoyed here in America, it has given us a wonderful
opportunity. It has given us a wonderful opportunity to take care of
the challenges and needs that are facing the country.
As I travel throughout southern Wisconsin, the constituents I listen
to tell me, you know, finally we have a chance to get our hands around
paying off the national debt. We have a looming crisis occurring when
the baby boomers begin to retire in Medicare and Social Security. Let
us take care of those problems so that Social Security and Medicare are
programs that can be enjoyed not only for this current generation of
retirees, but future generations of retirees.
Finally, we are an overtaxed Nation. We are paying a higher amount of
taxes than we do on food, shelter and clothing. We are paying the
highest level of taxes in the peacetime history of this country. So
when we are talking about budgets, it gets a little dry when you look
at the numbers, but what it really means is what is your vision for the
country, how are you going to address these challenges.
This chart shows you the different visions for this country, the Gore
vision and the Bush vision. The Bush vision is first pay off national
debt, stop raiding the Social Security trust fund and modernize
Medicare, and, as we accomplish those goals, if people are still
overpaying their taxes, give them their money back, rather than spend
it on new programs in Washington.
What the Vice President is proposing is just the opposite. Spend the
bulk of the money on new programs in Washington, pay off some debt, but
he is putting us on a path to where we will be forced to dip back into
Social Security to the tune of $906 billion to fund the new spending
initiatives that the Vice President is proposing.
The good fortune is this Congress has been able to keep the line on
spending, so we can pay off the debt. We have already paid off $354
billion. If we get our way, as we are trying to with these
negotiations, we will have paid off half a trillion dollars of debt
just in the last 3 years alone.
So what we are looking at here is the future. Are we going to take
advantage of this prosperity, of this surplus, to use it to pay off the
debt, to shore up Social Security and Medicare and let families keep
some more of their hard earned money, or are we going to spend the
money on new programs in Washington, as Vice President Gore is
proposing? These are the choices that will be determined in this next
election.

As you look at the details underneath these policies, the details
underneath these numbers, I just take a look at the Vice President's
idea for saving Social Security. I would just like to quote two
economists that the Vice President often listens to on his plan to
revive Social Security.
``The Vice President does nothing more than add more IOUs to the
Social Security trust fund. It is a papering over of the Social
Security trust fund. To quote the General Accounting Office, `the Vice
President's plan amounts to a pledge to provide that much more money
for Social Security in the future somehow. It does not specify the
sources. Thus, by itself, it does not fulfill any of the funding gap
with Social Security.' ''
That is what Alan Blinder said, who is the Vice President's economic
adviser.
David Walker, comptroller to the GAO, says, ``The Gore and Clinton
proposal does not come close to saving Social Security. Under this
proposal, the changes in the Social Security program will be more
perceived than real. Although the trust funds will appear to have more
resources as a result of the proposal, nothing about the program has
changed.''
So we are seeing a rhetoric being cast about across the country that
the Vice President is giving us a program, a proposal to save Social
Security, but when we actually take a look at it, it is just adding
more money, more IOUs to the Social Security program. It does nothing
to advance the solvency of Social Security. In fact, the spending plan
that the Vice President articulated in his acceptance speech in Los
Angeles, that he has articulated in his prosperity plan for America, is
one in which he is proposing to take $2.1 trillion, almost half of the
surplus over the next 10 years, and spend it on new programs in
Washington, to the point where he is proposing to dip into the Social
Security trust fund by almost as much as $906 billion.
Madam Speaker, that is not how you manage the surplus. What we are
trying to accomplish with this surplus, what Governor Bush is trying to
do with the surplus, is to stop the raid on Social Security. Do not dip
into the trust fund anymore, pay off our national debt, modernize
Medicare and Social Security, not on paper, but in reality, so that
those of us who are near and dear to us, our grandparents, our fathers,
our mothers, will have the program to rely upon in the future.
As our constituents, as working families, continue to pay more and
more and more to Washington, the highest level of taxation in the
peacetime history of this Nation, we are saying, let us let them keep
some of their money back as they continue to overpay their taxes,
rather than spending it on new programs in Washington. That is the
difference in this election. That is the choice that you have as a
voter here in this election by choosing either the Bush vision or the
Gore vision.
I see the gentleman from Florida (Mr. Stearns) is here, and I would
like to yield back to the majority leader who is controlling the time.
Mr. ARMEY. Madam Speaker, I am sitting here listening to the logic of
this whole campaign season. We all know it is often thought of as the
silly season, but just look here.
Governor Bush talks about 29 cents on the dollar he would like to
return to the people who created the surplus. No matter how you define
that tax reduction, whether it be marriage penalty tax relief,
inheritance tax relief, no matter how you define it, it is always said
to be, by Vice President Gore, a risky tax scheme. We label everything
that. Everything gets labeled that way.
Yet in the Gore plan you have a situation where he has the IRS
writing checks to give to people who do not pay taxes. He counts that
as a tax cut, instead of saying this is what it is, a risky spending
scheme. So there is that kind of confusion.
If the gentleman from Florida will just bear with us a little bit, I
think the gentleman from Michigan was just about to complete pointing
out that kind of confused thinking is what gives you the sort of sloppy
work that he has uncovered in one of our Nation's most important
agencies. I know the gentleman from Michigan has been very patient and
had wanted to complete his summary of those findings. I think we ought
to give the gentleman from Michigan that extra couple of minutes.
Mr. HOEKSTRA. Madam Speaker, I thank the gentleman for yielding, and
I enjoy being down here and being part of this special order.
Just a couple of other examples. The Education Department placed a
half billion dollars in the wrong Treasury account, then disbursed the
money without leaving an auditable paper trail. They also have
something in the Department of Education, which I think in the private
sector if you were a vendor with the Department of Education you would
find fascinating. It is called duplicate payments.
I cannot believe it happens. You provide a service to the Department
of Education, you bill them, and they pay you, and they pay you again.
You get paid twice. This year alone there have been $150 million of
documented duplicate payments. There is no telling how much we do not
know. These are the vendors that have contacted us and said, hey, you
paid us twice. I wonder if there are any out there that we do not know
about who maybe have been paid twice, closed shop and said, hey, this
is a pretty good deal.
I think the other thing that we really do have is we have got a
phenomenal education strategy to improve schools at the local level,
saying when you send a dollar to Washington, we want to get 95 cents
back into a local classroom. Today that is about 60 cents.
We know the local classroom is where we make a difference. We are
saying get the money out of Washington, out of this failed bureaucracy,
get it into a local classroom, get it to a teacher, get it to a teacher
who knows our kids' names. We are saying get the money back to the
local school district. Let them decide whether they need computers,
teachers, teacher training, whether they need construction or whatever.
But let local schools

[[Page H8298]]

make the decisions as to how they are going to spend those dollars.
We have 760 programs. You have to apply for each one of these
programs. It is a huge paperwork bureaucracy, and we know the
Department cannot handle it. Get the money back into the local school
district; say we are going to make the investment, but let you decide
how to spend it. Get rid of the Federal paperwork.
We know we have been in 20 States. Governors will come in and say we
get 6 to 7 percent of our money from Washington; 60 percent of the
paperwork comes from Washington.
Let us get rid of the red tape and bureaucracy and create an
environment where schools get back to reading, writing and arithmetic,
the three R's. Secretary Riley recently gave a speech and he has three
new R's: Relationships, readiness, and resiliency. It is kind of like,
I think we need our kids focusing on the basics. The only reason our
kids need to be resilient today is because they are not scoring well
enough on international test scores and we need them to bounce back.
But we need to focus not on relationships and readiness and
resiliencies, we need our kids learning the basics. We have got a great
education program that does not depend on the failed bureaucracy, but
puts power back where it needs to be, with local teachers and
administrators and parents.
I thank the majority leader for allowing me to participate and for
the extra time.
Mr. ARMEY. I want to thank the gentleman from Michigan. I think the
gentleman from Wisconsin would agree with me you could go into any
community in America and talk to the local school superintendent, talk
to the members of the local board of education, and I will bet you not
only is their judgment sounder and they have a better understanding of
what we need in their community, but I bet you every one of these
people can balance their books and survive an audit. So the folks back
home know what is going on with those precious tax dollars that pay for
that education back home.
We have just got to do better in Washington. We cannot ask for so
much of this money, create these new agencies and programs, and then
just leave them to run without supervision.
Finally, let me just say, we also saw that this kind of error is
committed in other agencies of the government as well. We found that
the Veterans Administration was able to have their computers hacked
with the kind of technology and practice that apparently any 12-year-
old might be able to figure out, and in the process of learning how
easy it was to hack the VA's computers, they too found two VA employees
that had each separately gone into the computers illegally and paid
themselves over $600,000 apiece. That kind of waste, inefficiency,
fraud and abuse casts a pall on the good, decent honest people that
work in agencies all over this country. It gives them a bad reputation,
but it shows the weaknesses in administration.
So we want to have good plans, good programs, good ideas, what we
want to accomplish in America, and a good sense of discipline in the
administration.
The gentleman from Florida, who I will yield to, is taking a look at
that now. Not only do we have this kind of failed ability to administer
existing programs, but we also see a great deal of risk in a continued
desire on the part of the Gore campaign, with Vice President Gore
wanting to continue to create programs put together on an arbitrary,
mandatory and potentially dangerous, risky basis, as they have been so
often in the past.
The gentleman from Florida (Mr. Stearns) has taken the time to look
into one in particular of Vice President Gore's proposals that affects
so many of your constituents. If wonder if I yield to the gentleman if
he would like to help us.

{time} 1645

Mr. STEARNS. Madam Speaker, I want to thank the distinguished
gentleman from Texas (Mr. Armey), our majority leader. I would like
this afternoon to focus on prescription drugs. We have talked about the
waste, fraud and abuse, the incompetency that the gentleman from
Michigan brought up, and the gentleman from Wisconsin, when he talked
about under a Gore administration they would spend $2.5 trillion over
the next 10 years, and this would go into the Social Security surplus.
I want to talk about one of the most potential political questions in
this election year. The Democrats have proposed a prescription drug
program that was defeated, and the Republicans proposed a prescription
drug program here in Congress that passed. So I want to focus on the
difference of these plans. And more particularly, about the difference
between the plan that the Gore campaign is talking about and what we
have passed here in Congress and what we think is better, which the
Bush campaign has adopted.
All of us in this House, all of us in the Senate are committed to
helping our seniors with access to affordable prescription drugs
through the Medicare program. But there is a key difference. Joshua
Hammond wrote a book called The Seven Cultural Forces That Shape Who
Americans Are, and the number one is choice, because we believe that
Americans should have choice in what they do and what is offered to
them by different programs. So I would like to discuss just briefly
today the proposed plans by Republicans and Democrats that have been
before this House and talk about the difference.
Madam Speaker, I might point out to my colleagues, this House has
been controlled by Republicans since 1995. But if prescription drugs
was such a problem, why is it that the Democrats did not propose a
solution to this before we took the majority in 1995? And why did we
have to wait for Republicans to come forward with a solution? So it is
easy for them to criticize, but they had 40 years when they controlled
the body over here to come up with their own plan and present it to the
American people. Why did they not do it?
It is only because Republicans have tackled this issue, which is very
controversial, and the Republican bill, H.R. 2680, would give
beneficiaries a choice. The hallmark of the American approach is
choice. We do it through two private sector drug plans. In addition to
having choice, the question becomes: Who do we trust? The government
running the program? Or do we believe that through choice and
competition we will get a better program?
Our program will allow beneficiaries to choose plans that best suit
their needs. Our plan is market-based rather than relying on the
Government to run the plan.
Now, why is this so important? Because we know that overwhelmingly,
the components of any plan that we must offer must have this choice. It
must be the centerpiece of any plan that we offer to the American
people dealing with prescription drugs.
How affordable are these plans? Let us look at these two plans and
see why they actually provide what they actually provide and how much
it would cost our seniors. Our bill, which is H.R. 4680, passed on the
House floor here on June 28. So the Democrats say the Republicans do
not have a plan. We have a plan; it passed here on the House floor.
Mr. ARMEY. Madam Speaker, if the gentleman would yield, I cannot help
but point out it was such a high drama day here in the House on the day
we voted a prescription drug plan for our senior citizens, one with
universal coverage, that had freedom and choice in it, that had a
premium subsidy for low-income seniors. It had a stopgap so that nobody
would be bankrupted by that.
On the day that we brought that to the floor to discuss it and pass
it, the Democrats, under the leadership of the gentleman from Missouri
(Mr. Gephardt), I remember him rising from his seat over there, got up
and walked out. Walked out on the debate. Walked out on the seniors.
Walked out on the whole issue.
To me, it was an enormously dramatic moment. And I thought to myself,
why they would walk out on that debate? But now they are back and
saying that we do not have a plan. I have to say to the gentleman from
Missouri (Mr. Gephardt) and my friends on the other side of the aisle,
if they had stayed at work and listened to the debate, if you had
participated, they would not have forgotten that we passed a plan that
day.
Mr. STEARNS. Madam Speaker, I think what the gentleman from Texas

[[Page H8299]]

is saying in a larger measure is just because they do not control the
House does not mean they cannot contribute. They could have been on the
House floor offering proposals, trying to make this bill in their
estimation better to their determination.
But we passed it. And as I point out, they have had years and years
to solve this problem and they did not. So now we have tackled it, and
I think it takes political courage.
We provide taxpayers a subsidy to encourage insurers to offer
policies which are affordable to our seniors. One key aspect about our
program it is voluntary and seniors taking part can choose from at
least two plans. All plans start with a $250 deductible, and it would
establish the Medicare Benefits Administration. This is an agency that
would run the program, but it would be private sector-oriented and
provide volume buying for these seniors. It would cover 100 percent of
drug and premium costs for couples with income up to $15,200 and
singles with incomes up to $11,300.
For all participants, it covers at least half of all drug costs up to
$2,100 annually and 100 percent of out-of-pocket costs up to $6000.
So we have something that private companies are providing, the
Government is giving incentives and subsidies to help them, it is
helping Americans get choice through at least two private sector
choices, and it is voluntary.
But let us take a look at the Democrat plan that the House defeated
here on the House floor. Currently, seniors pay a premium and receive
reimbursement for a portion of their hospital and doctor costs through
Medicare. Under the Democrat plan, they would use the new government
benefit to reduce the cost of pharmaceutical drugs. As I point out, it
is a government program. Translation: they put government in charge of
seniors' prescription drugs through the Health Care Financing
Administration, which is HCFA, which would choose, they would choose
and they would control the drug purchasing contractor for every region
of this country. HCFA would be doing it.
In other words, it would be a new Big Government program, a one-size-
fits-all plan. And this is a key element of their program.
In a recent survey done with seniors talking about drug coverage,
they prefer by a margin of two to one a program that is private sector-
oriented, that is voluntary, and not having the Government through HCFA
provide the pharmaceutical drugs. So the Clinton-Gore plan for seniors
dealing with prescription drugs is like a government-chosen HMO for
drugs; and, therefore, I do not think it is good.
Another thing I would like to say is that seniors would lose their
private sector coverage, whether they participate or not. This is a key
element.
I say in closing, the premiums for the drug coverage under the
Clinton-Gore plan come directly out of the monthly Social Security
check. Do not think this is going to be a choice. This is government
coming into seniors' Social Security check and taking the payment out
every month, whether they like it or not in this program that is not
voluntary. So I think the real questions seniors have to come to grips
with in this political season is do they want to have choice, do they
want to have competition or a voluntary approach to this plan, or do
they want to have the Government run it?
So I say to the distinguished Majority Leader, I think it is clear.
If the American people look at the two plans, the prescription drug
will be a plan that is much more favorable to seniors with what we
offered, what we provided on the House floor, and I regret that the
gentleman from Missouri (Mr. Gephardt) walked out on us.
Mr. ARMEY. Madam Speaker, I thank the gentleman from Florida for his
comments. If the gentleman would hold for a second, there is an old
story that a picture is sometimes worth a thousand words. One of the
things I think we should remember, today in America right now 70
percent of our seniors have already gone into the private markets and
purchased prescription drug coverage. They have shopped around. They
have checked out what is available. They decided and they chose
coverage that they are happy with. They do not want to lose it. They
are content. They understand it. They appreciate it. They want to keep
it.
A year ago, President Clinton offered a plan that would be mandatory.
``Go into my plan, forsake yours''; and the seniors rejected it.
Now, my friends on the left, the liberals, Vice President Gore and
others who want the government-run plan, will say about the seniors:
well, we cannot leave them to their own devices to go in the
marketplace and buy for themselves, because they cannot understand
those plans. Yet 70 percent of them are happy with what they decided
for themselves and do not want to be forced out of their plans.
But I should say this to Vice President Gore, if he is concerned that
today's seniors cannot understand what is available to them now, how
then would he expect them to understand this nightmare, this
bureaucratic nightmare? Every one of these little dashes, this horrible
snake here cut into slices, every slice is a new, better Federal
Government bureaucratic regulation.
Madam Speaker, the answer is very simple from the left: they do not
have to understand it. We decided it. They do not have a choice. They
will not make a choice. They do not need to know. The Health Care
Finance Agency will tell them what they are going to get.

I have to say, I know the gentlemen here on this floor will be
surprised by this, but I am over 60 years old. I am soon to be 65. I
refuse to accept any agency of the Federal Government declaring me on
that moment of my 65th birthday, ``Today Mr. Armey, you suddenly became
senile. You do not need to understand anymore. We will take over your
health care destiny.''
I have to tell my colleagues if they do not run my health care
destiny any better than they have been running the Department of
Education, I am not trusting them. I would rather choose for myself,
and I think most of America would.
Mr. STEARNS. Madam Speaker, just one final comment. I do not know how
soon the gentleman will be 65, but under the Gore plan, at age 64\1/2\,
if the gentleman does not want to join at that time, or changes his
mind later, he is out of luck because he has got to make his decision
at 64\1/2\ to do this, or there is no other chance.
The other point I want to make is that the Government will decide
which drugs are and are not covered. If the people, like the gentleman
from Texas, want to have drugs, the Government can decide it is too
expensive; and they will tell him to go to another drug. So all the
concerns we had about Mrs. Clinton's health care plan is coming back
with this pharmaceutical drugs plan. I think the American people should
understand that.
Mr. ARMEY. Madam Speaker, I thank the gentleman for yielding. The
bottom line is very simple. The plan we passed where they walked out,
would not participate, gives choice. What the Vice President's plan
gives is an ultimatum: join us now or never.
We have here the gentleman from California (Mr. Ose), who was
listening to my earlier remarks and wanted to come down and make a
point about the Vice President's tax plan. I think it is a very good
point, so I yield to the gentleman from California for that purpose. I
also understand the gentleman from California (Mr. Herger) wants to
make a few comments as well.
Mr. OSE. Madam Speaker, I appreciate the gentleman from Texas (Mr.
Armey), the majority leader, yielding me this time. His earlier
comments focused on our attempt to override the President's veto of the
marriage tax penalty relief. In that legislation there were two primary
components. One was relief for marriage tax penalty consequences, the
other was an adjustment to the threshold at which earned income tax
credits could be realized.
In my district where we have a significantly higher or above the norm
unemployment rate, we have a number of young people, a number of elder
Americans who actually work for wages, hourly wages who would be
eligible for the earned income tax credit if it had been adjusted for
inflation over these past 8 years. But in fact just as the Democrats
walked out of here back when we passed that bill, this Clinton
administration has walked out on lower-income people for an adjustment
in the earned income tax credit.
The President's veto of the marriage tax penalty relief right here in
this bill

[[Page H8300]]

also was a veto of an inflation adjustment to the level, the threshold
at which the earned income tax credit would be eligible for. That veto
cost a low-income family with two children $421 per year in terms of
the earned income tax credit. That is real money.
Mr. ARMEY. I thank the gentleman from California. That benefit denied
by the Clinton veto was a benefit that would have accrued to the most
low-income earners in America, not only all of my rich friends as they
were discussing earlier.
The gentleman from California (Mr. Herger) is a man of great insight
on the budget.
The SPEAKER pro tempore (Mrs. Biggert). The gentleman's time has
expired.
Mr. ARMEY. Madam Speaker, let me say I am going to invite the
gentleman from California (Mr. Herger) to come back next week for
another such session and let him lead off with his good insight.

____________________