[Congressional Record Volume 147, Number 61 (Monday, May 7, 2001)]
[Senate]
[Pages S4410-S4412]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    BUDGET RESOLUTION DELIBERATIONS

  Mr. LIEBERMAN. Mr. President, I rise today to speak about the 
deliberations that are now going on in both Houses of the Congress 
about the budget resolution, which will be before the Senate certainly 
some time this week.
  This is a most important time in this session and, I believe, is a 
moment of historic opportunity for our economy. As I have followed the 
debate, I have seen questions raised about, where is the Centrist 
Coalition in the Senate? Where are the so-called moderates? I know some 
voted for the Senate-passed budget resolution when it came up in the 
Senate earlier. I think some of those moderates are having second 
thoughts or are raising questions about the state in which that 
resolution came out of the conference committee, from which, as we 
know, Members of the Democratic Party were excluded.
  I want to speak with my colleagues today about my own feelings on 
this budget resolution. I do so as someone who has been a proud 
founding member of the Senate bipartisan Centrist Coalition, a founding 
member of the Senate New Democratic Coalition, because I truly believe 
this budget resolution, as it has come out of the conference committee, 
challenges and tests each of us on our fundamental views about what 
Government is about and what, most of all, fiscal responsibility is 
about.
  I have always believed that at the heart of being a so-called 
centrist or moderate is fiscal responsibility--that we will take care 
of the people's money here--more than a trillion dollars of it that we 
have charge of every year--with the same fiscal responsibility that the 
American people handle their own money in their personal lives, in 
their families, and in their businesses.

  As I looked at this budget resolution that has emerged from the 
conference committee, it is my strong feeling that it lacks more than 
just the two missing pages that are now being retrieved. This budget 
resolution profoundly lacks fiscal responsibility. It will not only do 
nothing to address the economic downturn that more and more Americans 
are feeling the pinch and pain of right now; I fear that it will set us 
on the road back to increasing debt,

[[Page S4411]]

to budget deficits, to increasing interest rates that go with 
increasing deficits and debt, and to the rising unemployment and 
falling investment that go with higher interest rates.
  This budget resolution is fiscally irresponsible. It is a tax plan, 
as colleagues have said, that is trying to look like a budget plan. I 
will put it this way: It is a tax plan, but it is not what we need, 
which is a prosperity and progress plan. It does not answer the 
question of how we continue the prosperity and progress of the last 
several years.
  I want to cite a few concerns I have about this budget resolution as 
it has emerged from the conference committee, which we will debate this 
week. First, to the best of my understanding, there is no longer a 
short-term, immediate economic stimulus component to this budget. 
During the recent debate on the Senate-passed budget resolution, 
several of us in both parties spoke to the need for an economic 
stimulus, as we watched important economic indicators going down. When 
the budget resolution came up in the Senate, our colleague, Senator 
Hollings from South Carolina, and several of the rest of us, sponsored 
and passed an amendment that set aside $85 billion of the current 
year's surplus for an economic stimulus in order to get money out to 
the taxpayers--every one of them, whether they pay the payroll tax or 
the income tax, as soon as humanly possible. We believed it was and 
still is important to put money in the pockets of all taxpayers this 
fiscal year so they can go spend it, boost the economy, and raise 
consumer confidence. It is my understanding that the conference 
committee has effectively removed the stimulus component from the 
budget resolution that will come before us this week. It is gone even 
as the economic indicators from the official bureaus of our Government 
and other organizations tell us that we need that economic stimulus 
even more today than when we voted in this Chamber just a few short 
weeks ago to adopt it. But it is not there.
  Just last week we learned that the unemployment rate for April shot 
up to 4.5 percent. That is the highest level of unemployment in America 
in more than 2\1/2\ years. Even more troubling, last month U.S. 
businesses cut their payrolls by the largest amount, 223,000 jobs, 
since the recession year of 1991. That is as clear an alarm bell as we 
could have and as clear a call for a short-term economic stimulus as we 
should need. Yet, it is not in this resolution.
  In addition, the University of Michigan, which has been measuring 
consumer sentiment in this country for many years, reported that 
consumer confidence fell last month to the lowest level it has been in 
7 years. This is not some political group, some partisan group; these 
are credible indicators. They cry out for the short-term economic 
stimulus--to get the money back into the pockets of America's consumers 
to spend and raise consumer confidence. And it is not there in this 
budget resolution.

  Secondly, the tax cut in this conference report seems to be growing 
well beyond the Senate-passed figure of $1.18 billion and even beyond 
the $1.25 billion that the Republican conferees claim is in this budget 
resolution. It seems that the $100 billion that was supposed to go 
towards an immediate economic stimulus is being rolled back into the 
larger Bush tax plan, bringing the real total to $1.350 trillion. Add 
to that an additional $50 billion in this budget resolution for other 
revenue reductions and you are up to $1.4 billion. That number doesn't 
include some of the automatic tax extenders that get renewed on a 
regular basis. It doesn't include necessary reforms to the alternative 
minimum tax that will be necessitated by this $1.4 trillion tax plan. 
It doesn't include increased interest payments on the debt that will 
have to be paid because we are spending so much of the surplus.
  Mr. President, I predict to you that if we should adopt this 
unfortunate, mistaken and, in my opinion, threatening-to-our-economy 
budget resolution, the tax plan will cost, at a minimum, $1.6 trillion. 
It will probably cost much closer to $1.8 trillion. I am sure when we 
get the resolution on the floor, we will have a clearer estimate of 
that. That tax cut will be taken out of what remains of a projected of 
$2.5 trillion 10-year on-budget surplus. But that $2.5 trillion surplus 
is based in part on an economic growth rate of 2.4 percent this year.
  However, the Congressional Budget Office has actually run some 
numbers on what would happen to that projected surplus if the growth 
rate slows this year. Some economists do think we are going into a 
recession this year, where at the end of the year we will actually have 
negative growth. I hope and pray not. According to the Congressional 
Budget Office, if that happened, if the growth rate for this year alone 
dropped to .1%, there would be a $47 billion drop in the projected 
surplus this year and a total reduction in the surplus of $133 billion 
over the following 10 years.
  That analysis even assumes that there would be continued robust 3.1-
percent growth over the following 9 years, which no one can assume. So 
you take whatever the tax cut ends up being--$1.7 trillion or $1.8 
trillion--out of that, and then you look at the spending side of this 
budget resolution, next year's domestic discretionary spending in the 
budget resolutions coming out of the conference committee does not keep 
up with the expected rate of inflation.
  So at a time when we are looking forward to surpluses, when we know 
from our families and our businesses that you have to make responsible 
investments to continue to grow, this budget is spending it almost all 
on the tax plan and saving very little for the kinds of investments 
that we need to make to keep our country strong, to continue the 
prosperity and the progress.
  Where are we going to get the money after this enormous tax plan 
proposal by President Bush and our colleagues in Congress is taken out 
of the surplus that we hope will exist--where are we going to get the 
money to invest in education, which every conversation I have had with 
people in my State of Connecticut, and every public opinion survey says 
is the No. 1 priority of the American people? Where are we going to get 
the money to invest in keeping our Nation strong, our national 
defenses? The numbers that are coming out of the Pentagon--rumored at 
this point--are quite high.
  I am a member of the Senate Armed Services Committee. I am privileged 
to serve with the distinguished occupant of the Chair, the Senator from 
Florida. One could make a case for some of these numbers, in my 
opinion. We need to invest more in our defense, but where is that money 
going to come from if domestic discretionary spending is held below the 
rate of inflation and so much goes to that tax plan?
  We are going to do serious harm to our economic future if we pass 
this fiscally irresponsible budget resolution. There is no way we can 
continue the operations of our Government in a realistic and 
responsible way if we adopt this budget. That is even assuming that 
good economic times return soon again next year and that this current 
downturn does not develop into a longer recession. There is no way we 
are going to pay the bills that are part of this budget resolution 
without dipping into the Social Security and Medicare trust funds.
  What happened to the lockbox everybody was talking about for Social 
Security and Medicare? Our seniors and those in the baby boom 
generation who are going to be coming into their senior years are 
expecting Social Security and Medicare to be there. With this 
conference report, they are going to find the viability of those funds 
have been hurt by a fiscally irresponsible budget. These are pivotal 
considerations and votes we are going to have this week.
  We have learned a lot in the last decade about the role of Government 
in the economy. One of the things we have learned, certainly centrist, 
New Democrats know, is that the Government does not create jobs. The 
private sector creates jobs. But Government can create an environment 
for growth, an environment in which the private sector can flourish.
  The first and most important thing that Government can do is to be 
fiscally responsible.
  The second thing is to have some money to invest in what creates 
growth, particularly in the high-tech information age. Nothing creates 
growth more than an educated public.

[[Page S4412]]

 We need to invest in our schools. We need to invest in training and 
retraining of existing workers. Yes, we ought to have tax cuts. We 
ought to have some tax cuts that help working families deduct the cost 
of higher education for their children or the cost of retraining 
programs for themselves.
  I am afraid this budget resolution, which carries out a campaign 
promise the President made in New Hampshire more than a year and a half 
ago when the economy was not in a downturn, when others he was running 
against were proposing flat taxes and he responded, will take us down 
the road to exactly where our history should tell us we do not want to 
go.
  This budget resolution is fiscally irresponsible. The economics do 
not make any sense. I am tempted to call it voodoo economics, Mr. 
President. The numbers do not add up and America's economy will suffer 
for it. Even more to the point, and personally, what will be hurt if we 
do not gather together, centrists of both parties, to speak for fiscal 
responsibility and reasonable investments and fiscally responsible tax 
cuts is the quality of life of millions of American families and the 
strength and stability of millions of American businesses.
  I urge my colleagues to look closely at this budget. Let us work 
across party lines on it and let us make it what the American people 
deserve and expect it to be: a fiscally responsible progress and 
prosperity budget.
  I thank the Chair, and I yield the floor.
  The PRESIDING OFFICER. The Senator from California.
  Mrs. FEINSTEIN. Mr. President, I associate myself with the comments 
made by the Senator from Connecticut. If the budget comes back as 
reports indicate the conference may send it back, I, who voted for it 
the first time, will not be able to vote to support that budget 
conference report.
  The Senator from Connecticut has very well made the points. For me, 
it is a profound disappointment that something I thought we had worked 
out and was understood is going to be reversed and come back in a 
conference report which is, for most of us, unacceptable.
  Mr. President, I know the hour of 2 o'clock is approaching. I ask 
unanimous consent that the time be extended just so I may finish my 
comments today.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mrs. FEINSTEIN. I thank the Chair.

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