[Congressional Record Volume 147, Number 24 (Tuesday, February 27, 2001)]
[House]
[Page H414]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                AMERICA'S GOAL: DO NOT SPEND THE SURPLUS

  The SPEAKER pro tempore (Mrs. Biggert). Under the Speaker's announced 
policy of January 3, 2001, the gentleman from Michigan (Mr. Smith) is 
recognized during morning hour debates for 5 minutes.
  Mr. SMITH of Michigan. Madam Speaker, tonight the President of the 
United States will come before this Chamber in joint session, and I 
suspect he is going to talk about three areas that should be important 
to all of us. One is what do we do with taxes and how much should they 
be lowered, and should we continue a wartime tax rate in this time of 
peace that is now bringing in an estimated $5.6 trillion of surpluses 
over the next 10 years, and probably that is going to be much higher; 
and, is it reasonable to say that surpluses are really overtaxation.
  The next question I think that he will also address is Social 
Security and the importance of keeping Social Security solvent. If we 
were to have a perfect world, or, if you will, a perfect Congress, we 
would probably not have a tax cut and we would start a program keeping 
Social Security solvent. But the danger in this body and over in the 
Senate is, if the money is laying there, all this extra surplus money 
coming in, if it is sort of laying there on the counter, if you will, 
Congress tends to increase spending.
  The President will also talk about the importance of continuing to 
pay down the debt. And, if you will join me on this chart for just a 
second for what is the debt of this country, the total public debt as 
defined in law is made up of three areas where government is borrowing. 
One is the debt held by the public, the Wall Street debt, the Treasury 
bills that are issued on a regular basis. That is approximately $3.4 
trillion. On the top we see the pink area, and the pink area is about 
$1.1 trillion of money that has been borrowed from extra Social 
Security taxes coming in, so what government has been doing for the 
last 40 years is taking this extra surplus from Social Security and 
spending it on other programs. At least now we have decided to, even 
though we are not doing anything to fix Social Security and keep it 
solvent, at least we are not going to spend that money, we have 
decided. The other area is about $1.2 trillion that is the other 116 
trust funds of Federal Government.
  So what we are doing, if we do not fix Social Security and do not use 
some of that money to invest better than the job we are doing right now 
with Social Security, we are lending it to the government, government 
writes an IOU and says, you cannot cash this in, but we will write you 
an IOU from the money we are borrowing from Social Security, we are 
taking the actual cash dollars and using it to pay down the debt held 
by the public. So over time, the debt held by the public will go down, 
but the amount that we owe the Social Security Trust Fund and the other 
trust funds will go up, to keep the total debt of this country about 
even and not have the total go down.
  Madam Speaker, this represents what has happened to the public debt, 
all three of the previous charts. If my colleagues will join me on this 
chart, we will see that the public debt of this country has remained 
relatively low up until the last 20 years, and now it is skyrocketing. 
What that means to me is that whether it is the debt held by the public 
or what we owe the Social Security Trust Fund or what we owe the other 
trust funds, somehow, some place, some time, government is going to 
have to come up with the money to pay that loan back.
  So that is the challenge for us. Where do we come up with that money? 
How do we come up with that money? If all we do is shuffle boxes around 
and use the surpluses coming in from Social Security and the other 
trust funds to pay down the debt held by the public, the debt will go 
way down low; but when the baby boomers start retiring, then we have to 
come up with the extra money needed to pay Social Security benefits, 
and the debt will soar. So again, if we are looking at the previous 
chart, the debt of this country has been going up tremendously, and 
now, if we use a little bit of the money of the Social Security surplus 
to pay down the debt, the debt will actually go down, but then again on 
the chart we just looked at, we just reviewed, it will again soar.
  The challenge before this body is what do we do with the surplus 
money coming in? Madam Speaker, listen to the increased spending 
dilemma that has faced this Congress. In 1997, we set budget caps. If 
we had stuck to those budget caps that we set in 1997, the increased 
spending over the next 10 years would have been $1.7 trillion less than 
it is today. Because of that increased spending, because of the 
propensity of this Chamber and the Senate and the White House to spend 
more money, we have increased spending more over the next 10 years 
because of what we have done in the last 5 than what the President is 
suggesting as a tax cut. Some of the tax cut will help get some of the 
money out of town so we will not spend it. That is our goal.

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