[Congressional Record Volume 149, Number 134 (Friday, September 26, 2003)]
[Senate]
[Pages S12045-S12051]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
RECONSTRUCTION OF IRAQ
Mr. DORGAN. Mr. President, I have just come from a meeting to discuss
the Appropriations Committee work beginning next week on the request
from President Bush for $87 billion in urgent supplemental
appropriations for Iraq. Of that $87 billion, roughly $66 billion is in
support of the military and the mission in Iraq; $21 billion is for the
reconstruction of Iraq. We will begin writing an appropriations bill in
response to all of this next Tuesday morning at 10.
I wish to bring to my colleagues' attention a couple of things with
respect to this issue. First, when America sends its sons and daughters
to defend our interests, when America puts its soldiers in harm's way,
it has an obligation to provide the resources and funding needed to
support their mission. I will support that. I will vote for that. I
believe the Senate, the entire Congress will do that. But, there is a
difference between providing the funding on an urgent basis for support
of our troops to carry out their mission in Iraq and Afghanistan and
the request for the reconstruction of Iraq. I want to describe that
difference.
Iraq is a country with substantial resources. It is not a country
desperately impoverished. It is a country with 24 million people. It
possesses the second largest oil reserves in the world. Ambassador
Bremer told us this week that when pumping at capacity, by next July he
expects the Iraq oil fields to be pumping at about 3 million barrels
per day. That produces about $20 billion in revenue per year, $16
billion of which is available for export; therefore, the development of
currency as a result of the export sales of $16 billion a year of oil,
each year, from the country of Iraq. This is not an impoverished
country. This a country with substantial wealth under its sands.
Pumping that wealth in the form of oil and selling it produces
substantial revenue for the 24 million people.
With respect to the question of the reconstruction, I want to go back
to April of this year and to a ``Night Line'' program in which Ted
Koppel had on one of the top folks in the Department of State who is in
charge of the U.S. Agency for International Development, Andrew
Natsios. He was asking Mr. Natsios about what would be required of the
American taxpayers for the reconstruction of Iraq. I want to read this
exchange because it occurred on the ABC television network 5 months
ago.
Ted Koppel says: You are saying that the top cost for the U.S.
taxpayer will be $1.7 billion with respect to the reconstruction of
Iraq?
Mr. Natsios, one of the top officials in the Department of State, who
heads the USAID which has the mission for projects for reconstruction:
Yes, for the reconstruction. Then there is $700 million in the
supplemental budget.
He was referring to something we had done earlier this year for
humanitarian relief.
Koppel says: But as far as reconstruction goes, the American taxpayer
will not be hit for more than $1.7 billion, no matter how long the
process takes?
Mr. Natsios: That is our plan. That is our intention.
Koppel says: And these figures, outlandish figures I have seen, there
is a bit of hoopla in all of this?
[[Page S12046]]
Mr. Natsios says, in response to a question: That is correct. One
point seven billion is the limit on reconstruction for Iraq.
Natsios says: The rest of it is going to come from other countries.
He says: We have arrangements with other countries.
Then he names the other countries. He says: In terms of the American
taxpayers' contribution for the reconstruction of Iraq, $1.7 billion.
The rest of the rebuilding of Iraq will be done by other countries that
have already made pledges--Britain, Germany, Norway, Japan, Canada,
Iraq.
He says: Eventually, in several years, when it is up and running, and
there is a new government that has been democratically elected, they
will finish the job with their own revenues. They are going to get $20
billion a year in oil revenues. But the American part of the
reconstruction for Iraq will be $1.7 billion. We have no plans for any
further funding for this.
That was this administration's spokesman said in April of this year.
Well, 5 months later, we have a new request to the American taxpayers
for almost $21 billion to continue the reconstruction of Iraq.
Mr. Natsios said $1.7 billion. That is all. We have no plans for any
other funding requests. Five months later, they are asking for another
$21 billion.
Let me tell you what my contention is on the $21 billion to
reconstruct Iraq. My feeling is, rather than have the U.S. taxpayers
provide $21 billion in grants to reconstruct Iraq, the revenue from
Iraqi oil should be used to reconstruct Iraq. So I asked Ambassador
Bremer about that.
he said: Well, that is not possible.
I asked: Why?
He said: Iraq has a substantial amount of debt. They have a lot of
debt. They have to repay this debt.
I said: To whom does Iraq owe debt?
He said: Germany and France and Russia.
So after that hearing, I went and took a look at who Iraq owed money
to. Well, guess what. The top of the list is not France, Russia, and
Germany. At the top of the list is Saudi Arabia and Kuwait and the
other Arab States, and then, yes, there is some owed to France and
Russia and Germany, as well. But at the top of the list is Saudi Arabia
and Kuwait.
What the Ambassador was saying to me is we cannot use Iraq's oil to
reconstruct Iraq. That oil is going to have to be pumped so they can
sell it for cash and send money to Saudi Arabia and Kuwait. So we will
have the American taxpayers pay some of their taxes so they can
reconstruct Iraq.
Sound perverse? It sure does to me. I think we should say to Saudi
Arabia and Kuwait: You loaned Saddam Hussein money. Well, you loaned
money to a government that doesn't exist anymore. You know that $50
billion Saddam Hussein owes you, owed Saudi Arabia and Kuwait? Go find
them and hand them a bill. It is not this country's obligation to bail
out Saudi Arabia for debts that they allowed Saddam Hussein to run up
with their countries. That is not our obligation. Iraqi oil ought not
to be used to repay Saudi Arabia and Kuwait from money they loaned to
Saddam Hussein. Saddam Hussein is gone. No one can find him. The Saddam
Hussein government is out of power. It doesn't exist.
So then the question is, How do you reconstruct this country? Well
here is some of what American taxpayers are being asked to pay for:
Forty garbage trucks, $50,000 each; $9 million to create a zip code for
Iraq in the postal system; $54 million for technical and business
process studies into a computer network for the Iraqi postal system;
building seven new communities, 3,400 homes, including marketplaces, a
church, and so on; two 4,000-bed prisons at $50,000 a bed. Well, that
is just a start--fix some roads, fix up some electric grids.
The interesting thing is that our ``shock and awe'' military campaign
explicitly did not target Iraq's infrastructure. We didn't take out
their power grid. We didn't do it because we didn't want to. We didn't
destroy their dams or their power grid or the infrastructure of Iraq.
Now we are told the infrastructure must be reconstructed. Why? Because
guerrillas and insurgent movements inside Iraq have destroyed some of
the infrastructure in Iraq, and because Saddam Hussein let it
deteriorate for over 20 years.
So the question is, What do we do in Iraq, and who pays for it?
That is a long route to get to my central point. I don't believe it
is the American taxpayers' responsibility to ante up $21 billion for
the reconstruction of a country that has the capacity to borrow $30
billion, repay it in 10 years at 6 percent interest, with $4 billion a
year that comes from a $16 billion-a-year stream of revenue by pumping
oil out of the sands of Iraq. Common sense? Sure. Maybe there are some
who cannot see that, but I think the American people will.
I have a September 2003 document. I guess it is 55 pages. It is the
reconstruction plan for the country of Iraq. Let me say, I believe Iraq
needs some reconstruction; there is no question about that. The
administration makes the point that the quicker this economy gets up
and moving, the quicker you have a vibrant set of opportunities in Iraq
for the people, and the safer it will be for our troops. I agree
with that. That is fine. But if you look at what they are asking the
American people to create in the country of Iraq in these 55 pages, let
me go through some of it: Private sector development, $200 million to
establish an American-Iraqi enterprise fund to capitalize the
enterprise fund to invest in a wide array of private enterprises. This
is sort of a venture capital fund of $200 million. Expand networks of
employment centers, $8 million; on-the-job training for private sector
employment, $35 million; develop a program for computer literacy
training in Iraq, $40 million; specialized computer training in Iraq,
$15 million; English as a second language in Iraq, $30 million;
modernize vocational training institutes, $25 million.
I could go on and on for 50 pages. I understand why they want to do
this. What I don't understand is why the American people are required
to pay for this, when this country is a country that has the second
largest oil reserves in the world and has the capability to produce the
revenue to pay for it themselves. This makes no sense. It defies common
sense.
I am going to offer an amendment in committee next Tuesday, and I
will offer it on the floor if it doesn't prevail in committee. I think
we ought to do a couple of things. One, I think we ought to separate
this issue and move the support for the troops immediately. I don't
think anybody here wants to withhold whatever necessary support is
requested to support the military. We sent them there; we have a
requirement to support them with all they need to complete the mission.
Second, I think we ought to separate the question of the
reconstruction in the country of Iraq and go back to April of 2003, 5
months ago, and the promise made to us and the American people by the
head of the agency and the State Department that is going to do the
reconstruction, Mr. Natsios, when he said our total obligation we are
going to ask the American taxpayers to fund is $1.7 billion. Believe
me, he said that is the total amount the American people are going to
have to fund.
Five months later, they came back and said: By the way, because Iraq
owes money to Saudi Arabia and Kuwait, and Iraqi oil has to be pumped
to pay debts to them, we want the American taxpayer to pay for basic
infrastructure in the country of Iraq.
I am telling you, there is something fundamentally flawed about that.
I hope my colleagues on the Appropriations Committee will see the same
thing. We are going to have a chance to vote on my amendment. It is
going to be relatively simple. It says this: Let's fund the military
request the President sent to us and do so quickly, and in a way that
says there is no question about supporting the troops we have sent
abroad. Second, here is the way we ought to reconstruct Iraq. The
President is right. Iraq needs reconstruction, but he is wrong to ask
the American taxpayers to pay for that. The way to reconstruct Iraq is
to securitize the oil to be pumped in Iraq at 3 million barrels a day,
beginning in July, according to Bremer, and use that securitization for
Iraqi oil to repay the securities from that over the next 10 to 20
years to reconstruct Iraq exactly as the administration wants it done.
I don't dispute any of these needs. I don't take issue with the
administration saying this ought to be done. I
[[Page S12047]]
take very strong issue with the suggestion that somehow an
administration that promised us 5 months ago the total cost of
reconstruction would be $1.7 billion, now says it is $21 billion in
reconstruction, which ought to come from American taxpayers' funds,
when we are dealing with the second largest oil reserves in the world.
So we are going to have votes on this in the Appropriations
Committee. We are going to have votes on it on the floor if it doesn't
prevail in committee. I have been reading in the paper that some
colleagues feel the same way on both sides of the aisle. They think
this makes no sense to talk about $21 billion in grants from the
American taxpayers to fund these issues. I hope some of them will join
me and that we can do what is right, use a big barrel full of common
sense on an issue like this, and help the American taxpayers and the
Iraqi people at the same time and, most importantly, do what is
necessary to support the American military who is trying to carry out
this critical mission in that part of the world.
God bless those men and women. We pray for their safety. We pray for
their families. As we work through this next week, I hope there is a
healthy dose of common sense in this Senate dealing with this
reconstruction issue.
I yield the floor.
Mr. CONRAD. Will the Senator yield for a question?
Mr. DORGAN. I would be happy to yield.
Mr. CONRAD. The Senator has mentioned that the President has come
before us and asked for $21 billion to reconstruct Iraq. In addition to
that, the President is saying there is another $40 billion to $50
billion of needs next year for the reconstruction of Iraq that is
supposed to come from someplace else. The President and his people have
said some of these other countries are going to contribute. Is the
Senator aware of this additional $40 billion to $50 billion of money
for reconstruction of Iraq that the President has identified?
Mr. DORGAN. Mr. President, responding to the question, I am, and
Ambassador Bremer made the same point as did Secretary Rumsfeld.
There is a donor conference that is being held in Spain in just a
matter of a couple of weeks. We have asked what is the proclivity of
these countries to begin helping and donating. Here is what we were
told: I believe it is 69 countries have donated $1.5 billion total.
In this request, they are asking the American taxpayers for $21
billion but say there will be a dramatic amount more that is needed but
that is going to come from somebody else. It appears very unlikely it
is going to come from anybody else. That is my point.
The first step is I think this administration ought to work to have
debt forgiveness with Saudi Arabia and Kuwait and others so they do not
have that debt overhanging that country and then have that country's
oil produce the revenue to reconstruct the country.
This is not a desperately impoverished country. This is a country
that sits on top of massive quantities of money in the form of oil, and
yet we are being told the American taxpayers--who are already facing
very large, staggering deficits, I might say--that somehow the issues
of building dams, building prisons, building communities, doing job
training, building hospitals, building health care facilities, building
roads, all of that should be borne by the American taxpayer at a time
when they have the capability to produce the revenue in Iraq to pay for
all of that. This is inexplicable to me.
As I said to my colleague, I hope we have a healthy dose of common
sense that prevails on this question. Not on the military issue. I want
some common sense there, too, but I do not want anybody to question
whether we are going to support the military. We do.
On reconstruction, we really need to go at this on behalf of the
American people, in their interest. It is not in their interest to have
to add this to the Federal debt and say to America's children, you pay
for the reconstruction of a country that has oil to pay for its own
reconstruction.
I yield the floor.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. I thank my colleague for giving an excellent presentation
and an excellent suggestion. This country has the second largest oil
reserves in the world, and we are getting ready to have the American
people rebuild that nation.
There is something really wrong with the administration's thinking on
this matter, to come before us and ask for $21 billion, to say there is
another $40 billion to $50 billion of need in the next year and that
they are going to get it from somewhere else, when the somewhere else
has promised $1.5 billion. So there is a shortage of another $40
billion. Where is that going to come from, and what is it being used
for?
My colleague from North Dakota pointed out what was in the Washington
Post this morning, a detailed analysis of some of these expenditures.
One that I found most unusual was $1 million per family in Iraq for a
witness protection program for 100 families. That is $100 million--$1
million a family. That is a pretty good deal. It is going to be used to
build prisons in Iraq for $50,000 a bed. Somebody is not thinking
straight.
They are going to create a ZIP Code, millions of dollars to create a
ZIP Code; area codes for phone systems, millions of dollars paid for by
American taxpayers. I do not think so. This in a country that has the
second largest oil reserves in the world. As my colleague has pointed
out, the reason we cannot use their oil money to rebuild their country
is that they owe tens of billions of dollars to Saudi Arabia and
Kuwait?
Somebody has to have some common sense. We have to slow this thing
down and think about what we are doing. I think the administration is
kind of discombobulated. They are running around throwing out numbers
they have not even thought through. That just cannot be what the
response of the Congress is.
In light of this request for $87 billion--and that is the tip of the
iceberg, unfortunately. The fact is, it is very clear they are not
going to get the $40 billion or $50 billion from anybody else and they
will be right back asking for tens of billions of dollars more. That
cannot be the response.
Now, why not? First, it is not right. It is not fair. The American
taxpayer should not be saddled with debts that are not ours. We already
have our own debts. We have a runaway freight train of debt in this
country.
In light of the President's request for another $87 billion, I think
it is time for us to go back to his State of the Union Address on
January 28, 2003, when he said to us:
This country has many challenges. We will not deny, we will
not ignore, we will not pass along our problems to other
Congresses, to other Presidents, and other generations.
That is what he said to us. But look at what has really happened. We
are doing precisely what he said we will not do. The debt of the United
States, which will be passed on to future generations, which will be
passed on to future Congresses and to future Presidents, is absolutely
mushrooming out of control.
The President told us just 2 years ago that in 2008 the debt would be
virtually paid off. He said there would only be $36 billion left. Now,
we know if we enact the President's policies, instead of virtually
paying off the publicly held debt by 2008, which is the smaller part of
the debt, it will be $6.2 trillion. How much is that? That is 6,200
billion dollars. That is how much the debt is going to be by 2008, the
point at which the President had told us we were going to have
virtually paid off the debt. So the President was wrong, and wrong by a
mile, on that assertion.
The President told us:
Tax relief is central to my plan to encourage economic
growth, and we can proceed with tax relief without fear of
budget deficits, even if the economy softens.
He told that to us 2 years ago. But let's look at what we now know.
What we now know is that instead of the assertion by the President that
there were not going to be budget deficits, we have record budget
deficits, the biggest in the history of the country, and by a country
mile. The President's last proposal was reviewed by the Office of
Management and Budget, and they tell us now that the deficit will be
$535 billion next year.
The previous record deficit was in 1992, when the first President
Bush was in office, and the deficit was $290 billion. Now for next
year, it is $535 billion. That is a record deficit. The
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President told us just 2 years ago it would not occur.
Then the President told us the next year:
. . . our budget will run a deficit that will be small and
short-term. . . .
He told us the budget deficit would be small and short term. That was
just a year ago. This is according to the President's own budget
documents. This is what happens if his spending and his tax proposals
are adopted. What we see is an ocean of red ink, and one that grows
year after year. These are not small deficits, they are not short-term
deficits, they are the biggest deficits we have ever had. And the next
10 years is the budget sweet spot. They are the good times, according
to the President's own analysis of his proposals. His own budget shows
us that his plan is taking this country right over the fiscal cliff.
This is what he says will happen to budget deficits. Not only are they
not small, they are record. And they are not short term, they are
endless.
This is the President's analysis out to the year 2050, and there is
no break in deficits anywhere here. It is deficits each and every year.
We are in this part of the chart now, which shows the smallest
deficits, and we know they are record deficits, the biggest deficits we
have ever had in the history of the country.
Next year alone, there is a deficit of $535 billion. The truth is, it
is much worse than that because they are going to take $160 billion of
Social Security money on top of that $535 billion of deficit. They are
going to take every penny of Social Security surplus and throw that
into the pot. So, on an operating basis, the deficit next year is
really going to be $700 billion.
The debt of the United States at the time Jimmy Carter was President,
after 200 years of history in this country, was around $750 billion,
and we are going to add that much or virtually that much in 1 year
under this President's plan. That is not the most serious part. That is
not the part that really worries this Senator. What really worries me
is, that is the tip of the iceberg, according to the President's own
analysis of his plans.
He says, if you adopt his budget plan, his spending, his tax plan,
that the deficits grow geometrically when the baby boomers start to
retire. At the very time the baby boomers retire, the cost of the tax
cuts explode, pushing us deep into deficit and debt, to levels never
seen in the history of the United States. That is the plan the
President is pursuing. It is a reckless plan and it is a dangerous
plan.
The President presented his budget for fiscal year 2004, and it said:
Compared to the overall Federal budget and the $10.5
trillion national economy, our budget gap is small by
historical standards.
First of all, there weren't going to be any deficits. That proved to
be wrong. Then the deficits were going to be small and short term. That
proved to be wrong. Now the President is saying, as a share of the
whole national economy they are relatively small.
The problem with that statement is it is wrong, too. It is wrong,
too. The next chart shows how big these deficits are as a share of our
national income. This chart goes all the way back to the end of World
War II--just after the end of World War II. You can see the previous
record deficit as a percentage of GDP was back in 1983--6 percent of
gross domestic product.
Next year, the deficit as percentage of gross domestic product is
going to be 6.2 percent, if one excludes the Social Security trust
funds from the calculation. So if you are looking at the budget on an
operating basis, if you are looking at it as any private sector firm
would have to look at its budget, what you see is the biggest deficit,
as a percentage of gross domestic product, since World War II. And the
President says it is relatively small. It is not relatively small, it
is huge. It is the biggest it has been since World War II.
Of course, what the President has left out is that the Social
Security surpluses back in 1983 were virtually nonexistent. So when the
President--the then-President--took those moneys, he wasn't taking
much. But look at what has happened to the Social Security surpluses.
They have been mounting dramatically, and now this President is taking
every dime of Social Security surplus to pay the operating expenses of
the country. No private sector firm would be able to do that. If you
were in the private sector, you couldn't take the retirement funds of
your employees and throw those into the pot to pay your operating
expenses. If you did, you would be on your way to a Federal
institution, but it would not be the White House. It would not be the
Congress of the United States. You would be on your way to the Federal
penitentiary, because that is a violation of Federal law.
Yet that is what this President is doing this year and next year,
taking every dime of Social Security trust fund surplus. And not just
this year and next year. Under the President's budget plan, he is going
to take every penny of Social Security surplus this year and next year
and the year after that and the year after that and the year after that
and for the next 10 years. Every penny is being taken to pay the
operating expenses of the Federal Government.
This President is taking us down the road that is a fiscal disaster
of the first order, and we had better start facing up to it. We are
going to have an opportunity next week because the President has come
before us and asked for another $87 billion--put it on the charge card.
No, this $87 billion has to be paid for. We have to start getting back
on track.
The President, in his latest estimates, tells us that revenue as a
percentage of gross domestic product is going to be at its lowest level
since 1950. You will recall one of his major justifications for the tax
cuts 2 years ago was that revenue was at a record percentage of gross
domestic product. Now we are headed for a record low, in terms of
revenue, and his answer is the same: Cut revenue more. It doesn't
matter what the question is, the answer from this President, from this
administration, is the same: Cut the revenue. If revenue is high, cut
it. If revenue is low, cut it some more.
It is not just a question of revenue being low, it is also a question
of spending being increased. This chart shows, for this year, 92
percent of the increased discretionary spending is in just three
categories: Defense, which accounts for the vast majority of it;
homeland security, which is the second biggest chunk; and the third
biggest chunk is rebuilding New York and providing relief for the
airlines, so badly affected by what has occurred. So we have not only
the lowest revenue since 1950, we also have increased expenses for
defense, homeland security, rebuilding New York.
Of course, all of us support those increased expenditures in order to
meet the obligations the country has taken on under this President.
The President is fond of saying, ``It's the people's money.''
This is a place where I agree with the President absolutely. It is
the people's money, he is absolutely right about that. This is the
people's money. But what the President has left out is that it is also
the people's debt. What he is running up here is a debt that is truly
massive in scope.
This looks at the gross debt of the United States. Earlier we were
talking about the publicly held debt. But if you look at the gross
debt, not only what we owe those who have loaned money to the United
States--which, by the way, includes a lot of money from Japan and
Europe--we also see that we owe money to ourselves. We owe money to the
Social Security trust fund that the President has been taking money
from in order to float this boat. That is truly stunning.
We have a gross debt of $6.8 trillion at the end of this year. But
look at what is going to happen in the next 10 years. We are going to
have a gross debt approaching $15 trillion. That is 15,000 billion
dollars. That is real money. And all of this is happening at the worst
possible time.
Why the worst possible time? Because, as this chart shows right now,
the green bar, which is the Social Security trust fund, the blue bar
which is the Medicare trust fund, are running surpluses in anticipation
of the retirement of the baby boom generation. Unfortunately, the money
is not being used to prepare us for the retirement of the baby boom
generation. The money is all being taken and spent on the operating
expenses and to pay for the President's tax cuts. That is where the
money is going. Not to prepare for the retirement of the baby boom
generation.
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The red part of these bars is the cost of the President's tax cuts.
What one sees is, when the trust funds go cash negative, which happens
in the next decade--in fact, it begins to happen pretty soon because in
2008 the leading edge of the baby boom generation starts to retire.
Look at what happens when those trust funds go cash-negative at the
very time the cost of the President's tax cuts explode, dragging us
deeper and deeper into deficits and debt. This is utterly
unsustainable. It is leading us to a crash landing.
You don't have to take my word for it. Here is a report from the New
York Times of September 14 reporting on the Congressional Budget
Office's warning to all of us here in Congress. Let me quote from the
New York Times:
This course--
the fiscal course that the President has embarked upon--
prompted the Congressional Budget Office to issue an unusual
warning in its forecast last month: If congressional
Republicans and the administration get their wish and extend
all of their tax cuts now scheduled to expire, and if they
pass a limited prescription drug benefit for Medicare and
keep spending at its current level, the deficit by 2013 will
have built up to $6.2 trillion.
That is not the gross debt. That is the publicly held debt--$6.2
trillion. That is 6,200 billion.
They go on to say:
Once the baby boomers begin retiring at the end of this
decade, that course will lead either to drastically higher
taxes, severe spending cuts, or ``unsustainable levels of
debt.''
That is the course we are on. That is the course the President has
put us on. It is a disastrous course by any judgment.
Again, we have heard from the Congressional Budget Office.
By the way, the head of the Congressional Budget Office used to be on
the President's budget team, his Council of Economic Advisers. He came
from the White House.
You don't have to just listen to me or to him. Here is the
Comptroller General of the United States, David Walker, in a speech on
September 17 to the National Press Club. He said in that speech:
The ultimate alternatives to definitive and timely action
are not only unattractive, they are arguably infeasible.
Specifically, raising taxes to levels far in excess of what
the American people have ever supported before, cutting total
federal spending by unthinkable amounts, or further
mortgaging the future of our children and grandchildren to an
extent that our economy, our competitive posture and the
quality of life for Americans would be seriously threatened.
This is the Comptroller General of the United States put in place by
the bipartisan leadership of Congress warning us that the course the
President has us on is a disastrous course.
We don't have to just listen to the head of the Congressional Budget
Office, or have to listen to the Comptroller General of the United
States. We just have to look at what has happened. We all can look and
we can read reality tests. Does it make sense?
Two years ago, the President told us we could have it all. The
President said we could have massive tax cuts. He told us we could save
Social Security and Medicare without touching the trust funds. He said
we could have maximum paydown of the debt. He said we could have a big
defense buildup. He said we could do it all. He was wrong. He was wrong
by a country mile. He was wrong on each and every count--not protecting
Medicare and Social Security. He is taking every dime of the Social
Security trust fund surpluses for the entire rest of the decade.
He said we wouldn't have deficits. We have record deficits. He said
he would virtually pay off the debt. The debt is exploding. The
President is taking us down a course that does not work.
Most recently, he told us:
It is important for you all to understand, for our fellow
Americans to understand, the tax relief I have proposed--and
will push for until enacted--will create 1.4 million new jobs
by the end of 2004.
We are not at the end of 2004. So we can't make a judgment on that.
But we can look back at 2001.
In 2001, he made the same kind of claim. He said if you pass his
plan, which we did, it was going to generate millions of new jobs.
Wrong again. He hasn't generated millions of new jobs. He has lost
millions of jobs--3.3 million jobs lost by August 2003 since this
President took office. That is the worst record on jobs since Herbert
Hoover. No other President of either party has lost private-sector jobs
during their entire term since the Great Depression. This President has
lost 3.3 million jobs with his economic plan.
Once again, he is wrong--just wrong. He is just wrong in assertion
after assertion after assertion. He is just wrong. That is the hard
reality we have to cope with.
If we look at this recovery that is underway--and there are signs of
economic recovery, which one would expect--if you go and write $700
billion of hot checks in a year on the Federal accounts, you expect to
give some lift to the economy. By spending all of this additional
money, all of these tax cuts, you would expect the economy to improve,
and it is improving. But we are not seeing much pickup in jobs.
We charted the last nine recessions which have occurred since World
War II--the job recovery that occurred during the recovery from those
recessions. Here is the trend line that we see: In each of those nine
recessions, there has been a good pickup in jobs when the economy
started to recover. Here is the pattern in this recovery. This is like
a dead cat bouncing. Nothing is happening. Jobs are not being
recovered. Jobs are still being lost, and the President told us he had
a plan, he had a strategy that was going to bring back jobs--millions
of jobs, he said. He was wrong.
Now some are saying deficits don't really matter. It is really quite
stunning to hear some of our Republican colleagues, who for years
believed deficits did matter, all of sudden completely change course
and say deficits don't matter. The Chairman of the Federal Reserve
Board believes deficits matter. Here is what he said before the Senate
Banking Committee:
There is no question that as deficits go up, contrary to
what some have said, it does affect long-term interest rates.
It does have a negative impact on the economy, unless
attended to.
Again, we didn't need to just listen to the head of the Federal
Reserve Board. Hear what the head of the Congressional Budget Office
said in testimony before the Budget Committee earlier this month. He
said:
To the extent that going forward we run large sustained
deficits in the face of full employment, it will in fact
crowd out capital accumulation and otherwise slow economic
growth.
This is the testimony of Mr. Holtz-Eakin who was, again, put in
office by the Republicans who control both Chambers, and came from the
President's own economic advisors saying that deficits do matter. They
do hurt economic growth in the long term.
Again, I go back to the Comptroller General and his outstanding
speech to the National Press Club on September 17.
The ``bottom line'' is, there is little question that
deficits do matter, especially if they are large, structural
and recurring in nature. In addition, our projected budget
deficits are not ``manageable'' without significant changes
in ``status quo'' programs, policies, processes and
operations.
I don't know exactly when this Congress is going to awaken to the
threat that is barreling down on us, but we face a circumstance just as
clear as it can be: The largest deficits in our history in dollar
terms, by far. Deficits as a percentage of GDP fairly measured that are
the largest since World War II and no relief in sight. Instead,
deficits as far as the eye can see, massive deficits that are coming at
the worst possible time, right before the baby boomers retire, right
when we should be paying down debt or prepaying the liability.
Instead, we are taking the money, hundreds of billions of dollars; in
fact, over $2 trillion of Social Security surpluses alone over the next
decade the President proposes taking to spend on other operations in
government. That is $2.4 trillion of Social Security money, taking
every dime. Not just this year, not just next year, but every year for
the next decade.
Two years ago the President told us we could expect nearly $6
trillion in surpluses over the next 10 years. In just 2 years that has
turned into $4 trillion, $4,000 billion of deficits.
Where did the money go? Here is where it went: 39 percent went to the
tax cuts the President proposed and pushed through Congress; 28 percent
went to increased spending, largely, as
[[Page S12050]]
I indicated earlier, defense and Homeland Security; 7 percent went to
the economic downturn; 27 percent in revenue shortfalls not associated
with the tax cuts. So two thirds of the disappearance of the surplus in
the move to deficits is on the revenue side of the equation. That is
where the money has gone.
Some are saying, we do not have to worry about this; we will grow our
way out of it. Here is what the Comptroller General of the United
States said, again in a speech to the National Press Club:
[T]he consensus opinion at a recent meeting of prominent
economists representing a wide variety of ideological
viewpoints was that . . . ``we cannot simply agree our way
out of this problem.''
It is time to face up to reality. It is time to face up to the fact
we have again down a course that is not working. I am not casting
aspersions on anyone's intentions or motivations. That does no good.
But we can now look back at the President's record objectively and
clearly. We can see that statement after statement he has made to this
Congress was simply wrong.
He said there would be no deficits. We have record deficits. He said
they would be small and short-term. They are massive and unending. He
said they are small as a percentage of our gross domestic product. They
are the biggest they have been since World War II as a percentage of
gross domestic product, fairly measured. The President said this would
all create jobs. He said it would create millions of jobs. Millions of
jobs have been lost.
Now he says he needs another $87 million that he does not want to pay
for. Where is the money going? We have heard a number of presentations
this morning: 500 experts, at $200,000 each, to investigate crimes
against humanity in Iraq. Let me repeat that. Here we are in the
deepest deficit, in debt at the worst possible time, and the President
says one of the things we should do is get us 500 experts at $200,000
each to investigate crimes against humanity. I am all for investigating
crimes against humanity, but I am all against spending $200,000 each
for 500 people in one year to investigate crimes against humanity in
Iraq. Have we completely taken leave of our senses around here?
He wants to build prisons over there at $50,000 a bed. He wants to
have a witness protection program that will provide $1 million per
family. Yes, it is there. Read the Washington Post: A witness
protection program for families of five, 100 families of five, at
$200,000 each in the family, five people, $200,000 each, and that is $1
million for 100 families, for a total of $100 million. We do not have a
witness protection program like that in this country.
Let's get serious around here. We are in disastrous deficit and debt
and we are talking about these kind of expenditures in a country that
has the second largest oil reserves in the world, and we say, ``Just
put it on the debt of the American people''? I don't think so. There
has to be a better way.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. KENNEDY. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. KENNEDY. Mr. President, we are in morning business?
The PRESIDING OFFICER. The Senator is correct.
Mr. KENNEDY. I thank the Chair.
Mr. President, early next week we will take up what has now become
the defining issue of this session of Congress--the Bush
administration's proposal for $87 billion for Iraq.
I support our troops in Iraq. We all support our troops in Iraq. If
that is the issue, the vote will be 100 to nothing in the Senate.
The administration had an effective plan to win the war. The tragedy
is that our troops are paying with their lives because the
administration failed to prepare a plan to win the peace.
Our troops performed superbly in the war. They are doing their very
best under enormously difficult circumstances now. They deserve the
full support of Congress, and they will get it.
But they also deserve a realistic plan from the administration. They
deserve to know how the administration will bring in the international
community, deliver on the promise of democracy, and bring our troops
home with honor.
The administration has refused to provide a realistic plan to the
Congress and our troops. It has provided only a 2-month-old, 28-page
plan called ``Achieving The Vision To Restore Full Sovereignty To The
Iraqi People.''
I would like to know why it is called a working document. I would
like to know why the administration is asking the Congress to write an
$87 billion blank check based on the draft plan.
This is the draft plan. I will include it by reference rather than
including all of it in the Record. It is 28 pages, including the cover
page, ``Coalition Provisional Authority, Baghdad, Iraq, Achieving the
Vision to Restore Full Sovereignty to the Iraqi People,'' dated July
21. It is a working document that is the basis of the administration
plan that was provided to the Armed Services Committee.
I will read from the provisions in the plan on security from August 1
to October 3, point 4: Locate and secure and eliminate WMD capability.
Then November 3 to January 4: Continue to locate and secure and
eliminate WMD capability. And then from February 4: Continue to locate
and secure and eliminate WMD. Point No. 1: Defeat internal armed
threats. That is August to October. November to January 4: Continue to
defeat all threats. February 4: Continue transfer responsibility to the
Iraqis.
It is an insult to the American people. It is an insult to our troops
who are paying with their lives. For most of us, when it comes to Iraq,
there is a widening credibility gap between rosy descriptions of
progress by the administration and the hard reality on the ground for
our troops and for the Iraqi people.
On September 14, Vice President Cheney said ``90 percent of the
cities and towns and villages are governed by democratically elected or
appointed local councils.'' He said that ``all the schools are open,
and that all the hospitals are up and functioning.''
In yesterday's Washington Post, Secretary Rumsfeld wrote glowingly of
our ``solid progress'' in restoring Iraq. Yet we all know that the
reality on the ground is quite different. And we are learning that
there are even those within the administration who are reporting that
things are not going well. Yet, those concerns are kept carefully from
public view.
In fact, the New York Times reported just last week on September 17
that new intelligence reports conclude that ordinary Iraqis are turning
against us. And Defense Department officials believe that ``indications
of that hostility extend well beyond the Sunni heartland or Iraq, which
has been the main setting for attacks on American forces.''
We are still losing an American a day. After going it alone on the
war, we have few allies to relieve our troops and join us in winning
the all-important peace.
Secretary Rumsfeld admitted this week that our failure to recruit
sufficient foreign troops likely means additional callups for our
reservists and guard units. General Abizaid told the Senate Armed
Services Committee yesterday that ``it doesn't look like we'll have a
coalition brigade. We have no choice but to plan for American forces.''
He is not counting on foreign troops. Clearly, the situation in Iraq is
out of control. Our policies are not working. Our plan in Iraq is an
$87 billion failure, and our troops are paying the price.
The administration must admit that our plan is not working, that we
cannot stay this course. We know it. The American people know it. Our
allies know it. We cannot afford just to stay the same failing course.
We owe our troops a change in plan.
Before the Congress writes a blank check for $87 billion, we need to
know that the administration has a realistic plan. Our troops who are
paying with their lives deserve no less.
I suggest the absence of a quorum.
The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
The PRESIDING OFFICER. In my capacity as a Senator from South
Carolina, I ask unanimous consent that the order for the quorum call be
rescinded.
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Without objection, it is so ordered.
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