[Congressional Record Volume 147, Number 17 (Wednesday, February 7, 2001)]
[Senate]
[Pages S1118-S1119]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             TAX CUT DEBATE

  Mr. DASCHLE. Mr. President, as the tax cut debate begins in earnest 
this week, I would like to commend to my colleagues' attention two 
editorials that appeared in separate South Dakota newspapers this week, 
the Pierre Capital Journal and the Madison Daily Leader. Both of these 
opinion pieces give an excellent explication of this year's budget and 
tax cut debate and responsibly advocate a tax cut while paying down the 
national debt. In so doing, each reminds us that beyond the Beltway and 
across the country the American public can see through the often 
overheated rhetoric of political debate and focus on the bottom line 
priority of maintaining the fiscal responsibility that forms the 
foundation of the economic recovery of the 1990's.
  As these editorials underscore, balance between tax cutting and debt 
reduction should be a central principle of the tax and budget debate. 
While Congress should and will pass a significant tax cut this year, it 
must also make sure that we pay down the national debt and address 
budget priorities like education, defense and healthcare. And so I 
commend Dana Hess of the Pierre Capital Journal and Jon Hunter of the 
Madison Daily Leader for their exceptional pieces advocating a tax cut 
within the parameters of sound fiscal policy. Their words should give 
us all pause for thought.
  I ask consent that these editorials be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                    [From the Madison Daily Leader]

           Paying Off National Debt Will Yield Great Results

                            (By Jon Hunter)

       Federal budget surpluses are now reducing the massive 
     federal debt after two decades of rapid growth. The benefits 
     of such debt reduction will be broad and long-lasting.
       The surpluses are so strong that the United States Treasury 
     announced it will stop issuing one-year Treasury notes at the 
     end of February. Why borrow money for one year when cash 
     receipts outweigh expenses every day?
       The change will permit the government to eliminate roughly 
     $20 billion in debt issuance in the current fiscal year. 
     Treasury had already eliminated sales of three-year and 
     seven-year notes.
       The changes mean lower interest payments on the national 
     debt but also pose a challenge for investors because there is 
     a dwindling supply of Treasury securities, considered the 
     world's safest investment.
       Even this potential challenge will be good for the U.S., in 
     our opinion. Investors who now own maturing one-year bills 
     will have to find other places to invest, and the most 
     logical place is short-term, high-quality corporate notes. 
     The demand will drive down

[[Page S1119]]

     borrowing costs for corporations, which would be similar to 
     an interest-rate cut by the federal reserve.
       It makes sense to pay down the debt in an orderly fashion. 
     If Treasury tried to pay off the existing longer-term bonds, 
     it would have to buy them back at a high premium. That's why 
     Fed Chairman Alan Greenspan said last week that since surplus 
     estimates are growing, he would support both debt reduction 
     and a tax cut.
       On Tuesday, the Congressional Budget Office (headed by 
     former Madison resident Dan Crippen) projected that the 
     overall budget surplus would be $5.6 trillion over the 
     decade, up from the $5 trillion bounty projected by the 
     Office of Management and Budget near the end of the Clinton 
     administration.
       In the early 1990s, the combination of a huge budget 
     deficit and higher interest rates were a drain on our 
     economy. Just the interest on the federal debt was consuming 
     about one-seventh the entire federal budget.
       We will soon experience the opposite effect: lower interest 
     payments will free up money for tax cuts or funding for 
     programs. Provided Congress makes good decisions about the 
     tax cuts or spending, both will provide excellent long-term 
     benefits for America.
                                  ____


            [From the Pierre Capital Journal, Feb. 1, 2001]

                Paying Debt Should Have Highest Priority

                             (By Dana Hess)

       Maybe it's his Texas roots that cause President George W. 
     Bush to think big. Or maybe he's just generous. Whatever the 
     reason, the president is pushing for a $1.6 trillion tax cut 
     over 10 years.
       Bush pushed the tax cut idea throughout his campaign for 
     office, even though polls showed that it was getting a 
     lukewarm reception from the public. Give him marks for 
     consistency because Bush still insists that the tax cut needs 
     to happen.
       We generally support the idea of the federal government 
     getting less of our money. After making such a mess of the 
     budget for so many years, it stands to reason that the less 
     money our representatives have to work with, the less likely 
     they'll be to get into trouble with it.
       Bigger and bigger budget surplus projections are giving 
     Bush and everyone else in Washington, D.C., big ideas about 
     what to do with the money. It's a politician's dream come 
     true--enough money to offer tax cuts and promote new 
     spending.
       We would hope that the years of deficit spending in 
     Washington would have taught lawmakers to be cautious when it 
     comes to spending our money. No one seems to have learned 
     that lesson.
       As much as we'd like to see taxes cuts, there are a couple 
     of good reasons why Bush and our lawmakers should slow down.
       The surplus exists, in a large part, because of the booming 
     economy our country has enjoyed. If that economy goes sour--
     and indications are that it may be ripening a little more 
     every day--then the projections of a big surplus will turn 
     out to have as much truth as the fears about the millennium 
     bug.
       With all the talk of surpluses and tax cuts, it's easy to 
     forget that there's still a debt to pay. Taking care of that 
     obligation should have a higher priority than trying to win 
     the favor of voters with tax cuts and new programs.
       We know they're famous for doing things in a big way in 
     Texas. But this nation has a Texas-sized debt. The president 
     should make sure his plan places just as high a priority on 
     paying down the debt as it does on tax cuts and spending 
     plans.

                          ____________________