[Congressional Record Volume 147, Number 17 (Wednesday, February 7, 2001)]
[Senate]
[Pages S1119-S1120]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            THE PRESIDENT'S TAX CUT PROPOSAL AND THE BUDGET

  Mr. NELSON of Florida. Madam President--that has a nice ring to it--
it is a privilege for me to take the floor and speak on an unrelated 
subject but a subject that is of considerable importance to the country 
and to the decisions we will be making very shortly. That is the 
adoption of a budget and the decision in that budget of how large the 
tax cut should be.
  Just in the last 24 hours, we have seen a consequence of the tax cut 
that now is proposed by the administration that is soaring upwards of 
$2.5 trillion over the next 10 years, a tax cut that the fiscal effect 
of $2.5 trillion would be so large as not only to wipe out all of the 
available surplus over the next 10 years, but to cause us to suddenly 
plunge back into deficit spending.
  We see a consequence of this in the last 24 hours in the fact that 
the administration is now not proposing to increase the defense budget. 
Personally, I think we should be looking at a minimum of increasing the 
defense budget over the next decade to the tune of $100 billion.
  The administration, now recognizing that its tax cut is going to 
absorb all of the available surplus, has just, in the last 24 hours, 
laid out the fact that it will not ask for an increase in the defense 
budget. When that occurs, I am quite concerned about our existing 
troops and what their pay is, the fact that there would be no increase 
for maintenance and operating costs, such as spare parts and rising 
fuel costs, a part of the defense budget that is absolutely essential 
to keeping our existing systems and equipment ready in case they have 
to be deployed, and the sufficient allocation of fuel so that our 
troops can have the proper training that is essential to their 
readiness.
  I can tell you there are a lot of pilots out there right now whose 
morale is pretty low because they don't feel as if they are getting 
enough flying hours, so that if the call comes and they have to go 
abroad to defend this country--particularly the pilots who are flying 
these precise pinpoint missions, not even to speak of the ones who have 
to engage in aerial combat--they will have had that training. This is 
going to be the consequence of keeping down the defense budget that 
this administration is reflecting because of its fiscal proposal of a 
tax cut so large that it is going to absorb all of the projected 
surplus--and, by the way, that may never materialize--over the next 
decade.
  If you cut the defense budget too severely, you are suddenly going to 
have systems that have not been upgraded and we will have unsafe planes 
and ships. That is simply a consequence that I don't think is in the 
interest of this country. After all, one of the main reasons for a 
national Federal Government is to provide for the common defense. So we 
are starting to see the ripple effects of this proposed fiscal policy. 
Why can't this fiscal policy instead be one that is balanced with a 
substantial tax cut?
  The question is not a tax cut or not; the question is how large 
should the tax cut be? That is where I argue for balance, so that we 
have a substantial tax cut balanced with the increased spending needs. 
And I have just given one example of defense.
  To give you another example, strengthening the Social Security fund; 
another example is modernizing Medicare with a prescription drug 
benefit; to give another example, increased investment in education. I 
have just listed only four additional areas. In this time of prosperity 
and budget surpluses, if we are fiscally disciplined, and if we are 
fiscally conservative, then we can meet all of the needs in a budget 
that will be balanced and that will protect the investment and spending 
needs as well as returning part of the surplus in the form of a tax 
cut.
  We have seen the charts offered by the Congressional Budget Office as 
to the projected surplus. I likened it, from my old position as the 
State fire marshal in Florida, to a fireman's hose. When that fireman 
takes that hose into a fire and he starts turning the nozzle, it first 
goes into fog, a light spray, and then increasingly, as you turn the 
nozzle, it goes into a straight stream of water.
  The charts we saw by the CBO projecting what the surplus would be 
over the next 10 years look like the spray coming off of a fireman's 
hose. For the chart with a line up to the present showing what the 
surplus is today, as you project it over 10 years, the range is from a 
huge surplus 10 years out to no surplus at all 10 years out indeed, 
into deficit. That is the inaccuracy of forecasting that CBO has 
admitted is truth.
  They also stated to us in the Budget Committee that the projected 
surplus--60 percent of it--will not materialize until the last 5 years 
of the 10-year period--all the more increasing the uncertainty of what 
is going to be available.
  So my plea to our colleagues, Madam President, is to let us be 
conservative in our planning, let us be fiscally disciplined and not 
fall back into the trap that I personally experienced when I voted for 
the Reagan tax cuts in 1981 and suddenly realized that I had made a 
mistake--and the country at large understood that it was a mistake--
because the cut was so big, we had to undo it in the decade of the 
1980s not once but three times. It had run us into such deficits in the 
range of about $20 billion at the end of the decade of the 1970s to 
deficits that were in excess of $300 billion per year by the end of the 
decade of the 1980s. In other words, the Government of the United 
States was spending $300 billion more each year than it had coming in 
in revenue, and that was getting tacked on to the national debt, which 
is what took us from a debt in the 1970s in the range of $700

[[Page S1120]]

billion to a national debt that is in excess of $3.5 trillion today.
  My argument to our distinguished colleagues in this august body is to 
use balance, let's use fiscal discipline, and let's use fiscal 
conservatism as we plan and adopt the next budget for the United States 
of America.
  Madam President, I am pleased to yield to the distinguished Senator 
from Georgia, one of the most able and capable of this body, a former 
Administrator of the Veterans' Administration in the Carter 
administration, a former distinguished Secretary of State of the State 
of Georgia, a distinguished junior Senator, now senior Senator, and 
even more so, I am proud that he is my good, personal friend. I yield 
to the Senator from Georgia.
  The PRESIDING OFFICER. The Senator from Georgia is recognized.
  Mr. CLELAND. Madam President, it is an honor to share the floor with 
my distinguished friend from Florida. He and I have known each other 
for a long, long time. I was out in the corridors and heard a familiar 
voice and realized that my friend was making his first speech on the 
floor of the Senate, which was a great pleasure for me to hear. He has 
eloquence, he has intelligence and everything it takes to make a 
powerful impact on this body. It is an honor to be with him on the 
floor.
  Mr. NELSON of Florida. I thank the Senator.

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