[Congressional Record Volume 152, Number 43 (Thursday, April 6, 2006)]
[House]
[Pages H1578-H1591]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 2007
The SPEAKER pro tempore. Pursuant to House Resolution 766 and rule
XVIII, the Chair declares the House in the Committee of the Whole House
on the State of the Union for the consideration of the concurrent
resolution, H. Con. Res. 376.
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In the Committee of the Whole
Accordingly, the House resolved itself into the Committee of the
Whole House on the State of the Union for the consideration of the
concurrent resolution (H. Con. Res. 376) establishing the congressional
budget for the United States Government for fiscal year 2007 and
setting forth appropriate budgetary levels for fiscal years 2008
through 2011, with Mr. Terry in the chair.
The Clerk read the title of the concurrent resolution.
The CHAIRMAN. Pursuant to the rule, the concurrent resolution is
considered read the first time.
General debate shall not exceed 4 hours, with 3 hours confined to the
congressional budget, equally divided and controlled by the chairman
and ranking minority member of the Committee on the Budget, and 1 hour
on the subject of economic goals and policies, equally divided and
controlled by the gentleman from New Jersey (Mr. Saxton) and the
gentlewoman from New York (Mrs. Maloney).
The gentleman from New Jersey (Mr. Saxton) and the gentlewoman from
New York (Mrs. Maloney) each will control 30 minutes on the subject of
economic goals and policies.
The Chair recognizes the gentleman from New Jersey.
Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
As you just indicated, the first hour of this budget debate has been
set aside pursuant to the Humphrey-Hawkins section of the Budget Act.
Under the rule, the Joint Economic Committee will have this hour evenly
divided on two sides.
According to most neutral observers, including the Federal Reserve,
and a consensus of private economists, the current economic expansion
is quite healthy. That is good news. Indeed, if anything, there seems
to be a little concern in most quarters that the economy may be growing
too fast, a concern that I do not share.
The U.S. economy grew 4 percent in 2004 and advanced at a rate of
about 3.5 percent in 2005. The growth rate in the first quarter of 2006
is expected to be very robust, probably over 4 percent, consistent with
the trend of strong growth seen since 2003.
The improvement in economic growth is reflected in other economic
figures as well. Let me name a few.
Since August of 2003, business payrolls have increased by 5 million
jobs. The unemployment rate has declined to 4.8 percent. Consumer
spending continues to grow. Homeownership has hit record highs.
Household net worth has also reached a record high. Productivity growth
continues at a healthy pace. Long-run inflation pressures appear to be
contained. Long-term interest rates, including mortgage rates, are
still relatively low, although somewhat higher than what they had been
previously. The resilience and flexibility of the economy have overcome
a number of serious shocks, most recently the hurricanes of last year.
Equipment and software investment have been strong over this period.
However, with somewhat higher mortgage rates, the housing sector is
slowing, although it appears that a soft landing is most likely. It is
clear that the Federal Reserve remains poised to keep inflation under
control.
In a recent policy report to Congress, the Fed noted that the U.S.
economy delivered a solid performance in 2005. Furthermore, the Fed
observed that ``the U.S. economy should continue to perform well in
2006 and 2007.'' The Fed, along with a number of private economists and
government agencies, expects that economic growth in 2006 will be about
3.5 percent, still very healthy growth. This economic growth will
continue to expand employment and further reduce unemployment.
In summary, overall economic conditions remain positive. The U.S.
economy has displayed remarkable flexibility and resilience in dealing
with the many shocks, including terrorist attacks and weather effects.
The administration forecast for economic growth in 2006 is comparable
with those of the blue chip consensus and the Federal Reserve. With
growth expected to be about 3.5 percent in 2006, the current economic
situation is solid and the outlook remains favorable.
Mr. Chairman, I reserve the balance of my time.
Mrs. MALONEY. Mr. Chairman, I yield myself such time as I may
consume.
(Mrs. MALONEY asked and was given permission to revise and extend her
remarks.)
Mrs. MALONEY. Mr. Chairman, I am pleased to speak in the time
reserved by the Budget Act for discussion of economic goals and
policies and traditionally led by members of the Joint Economic
Committee.
If you listen to the President and his supporters on the other side
of the aisle, you get a very upbeat assessment of the American economy;
but if you listen to the American people, you get a very different
assessment.
{time} 1215
The President likes to talk about how fast the economy is growing and
how successful his policies have been in stimulating an economic
recovery from the 2001 recession. But the American people are saying,
what economic recovery, and when am I going to see the benefits from
this President's economic policies in my take-home pay, in my pocket?
Mr. Chairman, we should listen to the American people and we should
adopt economic policies that promote the economic well-being of all
Americans, not just those at the very top of the economic ladder. The
President's fiscal year 2007 budget and the House budget resolution do
not do that.
Instead, they continue economic policies that have produced a legacy
of deficits and debt, that leaves us unprepared to deal with the budget
challenges posed by the retirement of the baby boom generation and that
weakens the future standard of living of our children and
grandchildren.
This administration has set a series of records, only they are the
wrong kind of records. They have raised the debt ceiling four times. It
is now over
[[Page H1579]]
$8 trillion. Every man, woman and child in America now owes at least
$28,000 of that debt, and we have had the largest deficit and trade
deficit in the history of this country.
This chart shows how the President inherited a budget situation with
large surpluses, but we have ended up with a string of large deficits.
Economic policy over the last 5 years has not served the interest of
the typical American working family. The resilience of the American
economy has allowed it to recover from the 2001 recession, but we are
still experiencing the labor market effects of the most protracted job
slump in decades.
Job creation has lagged far behind what is typical in a strong
economic recovery. There is still evidence of hidden unemployment, and
the benefits of productivity and productivity growth have been showing
up in the bottom lines of companies rather than in the paychecks of
American workers.
Finally, and very disturbingly, there is a growing gap between the
``haves'' and the ``have-nots'' in this country as income and earnings
disparities have widened. This is a very troubling trend. Yes, workers
have become more productive. They produce more and more in each hour
that they work. But they have not been getting rewarded for their
productivity.
Average hourly earnings have not kept up with inflation, and they
barely kept up even before that. Median family income has failed to
keep up with inflation every year that President Bush has held office.
Those who are already well-to-do are doing very well in the Bush
economy. But the typical, hard-working American family is struggling to
make ends meet in the face of high costs for energy, health care, and a
college education for their children.
This chart illustrates the problem very clearly. The red bar shows
the growth in the inflation-adjusted usual weekly earnings of full-time
wage and salaried workers under President Bush at different points in
the earnings distribution. You have to be in the upper half of the
distribution to have seen any gain. Earnings at the top have grown
fastest relative to inflation and earnings at the bottom have fallen
farthest behind inflation.
I would note the contrast with the last 5 years of the Clinton
administration, which is the blue bars, when earning gains were strong
and spread throughout the earnings distribution. They spread the
wealth. They shared the wealth. The budget we are debating today does
not address any of these problems. In fact, it makes matters worse.
An analysis by the Democratic staff of the Joint Economic Committee
shows that budget cuts in programs that provide payments for
individuals are concentrated among lower income families, while the tax
cuts go overwhelmingly to those at the top of the income distribution.
The blue bars on this chart show that more than a third of the cost for
spending cuts go to families in the bottom 20 percent of the
distribution, families that together have only 3 percent of aggregate
income. Meanwhile, those at the top get nearly three-quarters of the
benefits from the tax cuts in this budget, as shown by the red bars in
this chart.
With policies that have turned a $5.6 trillion 10-year budget surplus
into a deficit over those same 10 years of at least $2.7 trillion, this
administration has turned us into a nation of debtors, relying on the
rest of the world to finance our budget deficits and the rest of our
excessive spending.
Last year, we had a current account trade deficit of over $805
billion, the largest in the history of this country, the largest in the
world. That is the amount of money we had to borrow from the rest of
the world to finance our trade deficit and international payment
imbalance. Foreign governments are holding large quantities of our
public debt, putting us at risk of a major international financial
crisis if they should decide the benefits of holding dollars are no
longer worth that risk.
Mr. Chairman, our future prosperity depends on increasing our
national savings and making wise investments. It depends on being ready
for the retirement of the baby boom generation and the pressure we know
that will be put on the budget with their retirement. But how is the
other side preparing us for that future? With more deficits and more
debt, the largest in the history of our country.
They want to make the tax cuts that have gotten us into this mess
permanent, and they have no realistic plan for controlling spending or
bringing revenues into line with the amount we need to spend to defend
the country and take care of the needs of our citizens. This is the
wrong direction that we are going in. We need a better plan.
Mr. Chairman, I reserve the balance of my time.
Mr. SAXTON. Mr. Chairman, I yield such time as he may consume to the
gentleman from northwestern Pennsylvania (Mr. English).
Mr. ENGLISH of Pennsylvania. I want to thank the gentleman for
yielding, and I think the time has come, particularly after the last
speech, for a reality check here.
What we have seen since the 1990s is that the key to balancing the
budget is economic growth and pro-growth tax policies. That is what our
budget resolution stands for and what our budget resolution promises to
preserve. In the 1990s, when we balanced the budget, and I might add we
balanced the budget because we had a Republican Congress committed to
fiscal austerity, we were able, through controlling spending, to allow
the growth in the economy to overcome a budget deficit that the other
party, frankly, couldn't deal with when they were in the majority.
By putting in place pro-growth economic policies in 2003, this
Congress laid the groundwork for an economic recovery which has
generated unprecedented revenues and, in generating those revenues, has
steadily brought down the deficit and brought it within reach of
control.
Now, I will be the first to admit this budget document does not fully
account for the cost of war. It doesn't account for the cost of some of
our recent national disasters. Those have always been treated as one-
time expenses, and appropriately so. But our underlying deficit, in my
view, is being dealt with in this budget in the most direct and
credible way, and that is through restraining spending and allowing us
to maintain in place pro-growth tax policies.
Now, what the other side doesn't tell you, and what they are really
hot for, is that they want to see a tax increase. They want to see us
forced to raise tax rates above those contemplated in our 2003 tax
policy. Our existing tax policy, as then Chairman Greenspan conceded,
has been critical in growing the economy; growing the economy last year
at a rate of 3.5 percent, the envy of the industrialized world; growing
our economy in a way that allows us to find new revenues even as we
create wealth and we create jobs.
Now, Mr. Chairman, I will be the first to concede that in
congressional districts like mine in northwestern Pennsylvania we have
seen the downside. We have seen an economy that has lagged behind the
national economy. We have seen the effects of unfair trade. We have
seen job losses that haven't fully been recovered, particularly in the
manufacturing sector. But the solution is a growing economy.
And what this budget resolution promises is that we will be able to
maintain the tax policies that have produced the growth even as we curb
spending and show fiscal restraint. In the process we are in a position
to set up this country to escape from the budget deficit, to lower
national debt as a proportion of the national economy, and, over time,
position ourselves to hand to the next generation a prosperous America.
This budget resolution is critical to the long-term economic health
of our country, and it is based on a philosophy of pursuing pro-growth
policies that allow us to generate the revenue that we need. The other
side, by pushing us towards policies that would raise taxes and
ultimately take more resources out of the economy, I think threatens
that growth and threatens that recovery.
Ultimately, I believe, there is a clear contrast here, one in which I
am very proud to stand on the side of growth and opportunity.
Mr. SAXTON. Mr. Chairman, I reserve the balance of my time.
Mrs. MALONEY. Mr. Chairman, I yield to my distinguished colleague
from the Joint Economic Committee and from the great State of New York,
Maurice Hinchey, such time as he may consume.
[[Page H1580]]
Mr. HINCHEY. Mr. Chairman, I thank very much my colleague from the
State of New York, our ranking Democrat on the Joint Economic
Committee, for her leadership here and for yielding me this time.
This debate in which we are engaged in this afternoon is a critically
important one for the future of the American economy. As my colleague
Mrs. Maloney pointed out just a few moments ago, we are currently
facing the largest budget deficits in the history of our country.
According to the budget resolution itself, this burgeoning budget
deficit will grow by $372 billion just over the course of the next
fiscal year. Many people regard that number as conservative.
Many people who are analyzing the economic circumstances that we are
confronting as a result of the incompetent budget policies of the
Republican Party here in the Congress estimate that this budget deficit
can be substantially more than $400 billion. In any case, even if it is
only $372 billion, that sets another record. Now, maybe they are proud
of the record that they are setting, and that seems to be the case
based upon what we have just heard.
In addition to the record budget deficit this year, we are also
facing record debt. The national debt has now grown to more than $8
trillion, and the majority party here in the Congress very, very
quietly, under cover, raised the debt ceiling to almost $9 trillion.
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This majority party is the biggest borrow-and-spend operation that we
have ever seen in the United States of America, totally and completely
irresponsible in their approach to dealing with the American people's
money. As a result of that, the economic circumstances that we are
confronting are becoming increasingly difficult.
A major portion of their failures has been their approach to the tax
system. We just heard my friend and colleague on the other side of the
aisle say that the Democrats are in favor of a tax increase. That is
completely fraudulent. It is another part of the propagandistic
approach that the majority party has taken to dealing with these most
significant issues in which we are presently engaged.
We are not in favor of tax increases; we are in favor of reducing the
irresponsible tax reductions that the Republicans have engaged in over
the course of the last 5 years. Those tax reductions have benefited
primarily the wealthiest 1 percent of the population of America.
Let me give an example of that. If you are a person making $10
million a year, if that is what you made last year, $10 million, the
effect of the tax cuts on your budget is very, very significant. When
you factor in the deductions and investment approach, you find that
your taxes have fallen by $1 million. Your taxes have fallen by $1
million if you are making $10 million a year. That is what they have
done. They have cut taxes for the very wealthiest people, and they are
increasing the budget deficit that is going to have to be paid back by
the vast majority of working people in this country, this generation
and future generations.
This is the borrow-and-spend approach to governance that the
Republican Party in this House has put forward and which they continue
to advance in the context of this budget resolution.
What has been the effect of all this on the average American? What we
have seen is that wages and salaries of the working people of our
country have risen at their lowest rate since 1981. And I am talking
about over the last 5 years. They have risen at their lowest rate since
1981. When you look at what has been happening in the last 2 years, you
find that wages and salaries have actually been in decline. People are
seeing their wages and salaries, when you take into effect inflation,
actually going down.
So if you are a wealthy person, the Republicans are taking very good
care of you. If you are an average American working for wages and
salaries, you are finding your situation in desperate shape. So this
budget resolution is another failure on the part of the majority party
in America. They are creating deeper deficits for us. They are putting
us into deeper and deeper debt. Their approach to taxation has been for
the rich and against the working class; and in an economy which is
based upon demand, it is forcing that economy down, and we are seeing
it broadly all across the American economy, losing manufacturing jobs
at record rates. All of that is as a result of the economic policies
that have been put forth by the majority party here in the House of
Representatives.
So the point we are making right here now is once again we have a
budget resolution on the floor of this House which is incompetent and
irresponsible, which is going to mean higher taxation in the future for
the average working families in our country while it cuts taxes for the
wealthiest and most privileged and while it increases the national
debt.
They talk about the economy growing. We have had an economy that has
experienced the most stimulation, both monetary policy stimulation and
fiscal policy stimulation, in the history of the country. The lowest
interest rates and huge amounts of spending have increased the national
debt. That is the situation we are confronting here today, and that is
why this budget resolution needs to be defeated.
Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
It seems like there must be an election coming to hear some of the
rhetoric here on the floor which actually defies reality. Let me try
and explain to those who are at least open-minded about the situation
what has happened with our economy over the past 5 or 6 years.
We all remember during the late 1990s we had very robust growth in
the stock market. Things were perking along at a rate that most
economists at the time thought was an exuberant time when investments
were being made for reasons other than perhaps good, solid rationale.
In the third quarter of 2000, the economy began to get soft and in
the last quarter of 2000 it did even worse. As we look at the reasons
for that, there were a number of economists who concluded different
things. One thing became clear, and that was investment was not being
made and that something needed to be done.
This chart to my left is a chart which shows fixed private,
nonresidential investment, in other words, investment in things that
would be productive in our economy. As we look at what happened as we
began to move through 2001 and 2002, these bars that drop below the
line show there was negative investment. People were not investing in
productive things; and as a result of that, the economy was not doing
well.
The administration proposed a fix, and that fix was to do things here
in the House of Representatives and in the Senate and through the
administration that would encourage the American investor to reengage
in investing in productive things. And so in 2003 the House of
Representatives and the Senate collectively, together, passed some tax
cuts to encourage investment. And those tax cuts, which were temporary
in nature which we continue to talk about making permanent, had the
desired effect.
If we look at this chart and look at when the negative investment
ended and positive investment started, it happens to be after those tax
cuts went into effect. As a result of reducing the percentage of taxes
paid on dividend gains and as a result of tax cuts on capital gains, we
see beginning in 2003 and through 2004 and through 2005 and projected
to continue by the Fed and by other blue chip economists and blue chip
forecasts, we are expecting to see that growth continue through 2006
and 2007. As a matter of fact, we had 4 percent growth in 2004; 3.5
percent growth in 2005; and in the first quarter of 2006, we saw 4
percent growth continue. This is good news for not only the American
investor; it is also good news for others in the workforce and in the
economy.
Here is what happened to employees' payrolls during that period of
time. Once again we see some lines that drop below the positive mark.
We see some negative growth in nonfarm payrolls as we move through. And
as we saw the 2003 tax cuts go into effect, once again we saw the
economy rebound and we see employees in nonfarm payrolls begin to
increase to much healthier levels than they had been during the 2000,
2001, 2002, and 2003 period of time when investments, productive
investments, were not being made.
[[Page H1581]]
As we sought an answer and the administration proposed the tax cuts
and the House and the Senate implemented the tax cuts, once again
nonfarm payrolls and employees' payrolls began to grow, as demonstrated
by this chart.
Finally, gross domestic product, which is how most economists measure
growth in the economy, continues to be very good. Beginning in 2003, as
our tax cuts went into effect, dividend tax cuts, the taxes on
dividends were lowered, the taxes on capital gains were lowered. We see
in 2003 and 2004 as we move across here, and as I said before in 2004,
we had an average of 4 percent growth. In 2005, we had an average of
3.5 percent growth over the four quarters of that year.
The forecast for the first quarter of this year, which is in red, the
first of the four lines, the actual forecast is 4.7 percent. I think
that might be a little high. I think it might be closer to 4 percent.
But that is healthy economic growth, and we continue to see the effect
of the policies we have put into place. We expect that the growth may
slow somewhat during the first, second, and third quarter; but we
believe we will average 3.5 percent this year.
I might add one thing that I think is important for us to remember,
and that is that the tax cuts, together with other policies, have
produced this growth and we need to continue to support those policies
as well. The Federal Reserve has been a huge part of this as well.
While it is nice for the Congress to take credit with the
implementation of the tax policy that we implemented, the Federal
Reserve also deserves a lot of credit for what has happened here
through the policies that have been brought about through something
called ``inflation targeting.''
Today, inflation is very low. Inflation is around 2 percent; and it
is around 2 percent because, in my opinion, the Federal Reserve has
used this policy of inflation targeting as the cornerstone for Fed
policy. As inflationary expectations, as we look to the future,
interest rates have continued to be historically low. In spite of the
fact there has been a little up-tick in interest rates because of Fed
policy in the last year or so, we continue to see affordable interest
rates and interest rates that influence investment and continue to
provide the stimulus that we need for the kind of economic growth that
we have seen since 2003.
Mr. Chairman, I just wanted to make these points. I think this is a
very important background for us as we begin this budget debate.
Mr. Chairman, I reserve the balance of my time.
Mrs. MALONEY. Mr. Chairman, I yield myself such time as I may
consume.
Mr. Chairman, the gentleman mentioned the rhetoric coming from this
side of the aisle; but we are not speaking rhetoric, we are speaking
facts and figures and numbers do not lie.
The other side of the aisle raised the debt ceiling four different
times under this administration so we now have a record debt of over $8
trillion. That is not rhetoric; that is a fact. If you break it down,
each man, woman and child in America owes $28,000; and it is galloping
upwards, the debt on our children and our grandchildren.
Another fact that is not rhetoric is we have the largest trade
deficit in the history of our country, the largest in the history of
the world; and other countries are financing our budget. We are
shifting our wealth to other countries. It has been said if China
invaded Taiwan, we would have to borrow money from China to defend
Taiwan. That is not a good position to be in.
Mr. Chairman, the budget offered by the majority continues the failed
economic policies of the Bush administration. The typical American
family is still feeling the effects of the most protracted job slump in
decades. Actually, it is the worst job slump since the 1930s. On top of
that, wages and incomes are stagnating. There is a growing gap between
the haves and the have-nots. This is a tremendously troubling trend in
our country.
But this budget does not address any of those problems. It contains
unfair spending cuts that disproportionately harm middle- and lower-
income families to help pay for tax cuts that go overwhelmingly to
those who are already very well off. Where is the fairness in this
budget?
And this budget continues to add to our legacy of deficits and debt
and has turned us into a Nation of debtors relying on the rest of the
world to finance our budget and our deficits.
{time} 1245
This is a very troubling trend in our country. We have never had it
before. It leaves us unprepared to deal with the challenge posed by the
retirement of the baby boom generation and weakens the future standard
of living of our children and our grandchildren. I urge a ``no'' vote
on this budget.
Mr. Chairman, I yield 4 minutes to the gentleman from South Carolina
(Mr. Spratt), the distinguished ranking member on the Budget Committee.
We thank him for his leadership on this and his leadership in so many
areas.
Mr. SPRATT. Mr. Chairman, the administration has devoted a lot of
energy to touting the successes of the economy, particularly with
respect to the job statistics, as justification for the 2001 and 2003
tax cuts. But let's look at the record.
When President Clinton took office in January 1993, there were 109.7
million jobs in the national economy in the work force. When he left
office in January of 2001, there were 132.5 million jobs. That means
that during the 8 years of the Clinton administration, there was a gain
of 22.8 million jobs. These were the jobs created during the Clinton
administration at a time when we brought the budget to balance, making
the bottom line of the budget every year better and better and better
to the point where we had a surplus in 1998.
Now, compare that job gain, 22.8 billion to what has happened during
the Bush administration. When President Bush took office in January
2001 there were 132.5 million jobs in the economy, according to the
BLS. By January of 2006, 2 months ago, the economy had a total of 134.6
million jobs. That is an increase of 2.1 million jobs, versus 22
million jobs created during the Clinton administration. No comparison.
Stark contrast.
What is even worse is the fact that the Bush administration has seen
most of its job gains of more than 50 percent occur in the public
sector, not in the private sector. The tax cuts that have led to the
deficit did not generate the jobs that were proposed or projected in
the private sector. Far from it. Growth has come in the public sector.
And this is worst of all. Job growth in the manufacturing sector
under President Clinton grew by 315,000. Not impressive, but at least
not a loss. Under President Bush the manufacturing sector has lost 2.9
million jobs. 2.9 million jobs over the last 5 years, an average of
48,000 jobs a month.
Now, when we say that the economic gains that appear from this GDP
growth and other things that look positive, stock market, the Dow Jones
are all doing well and are healthy vital signs, we are glad to see
them. But they are not translating into the lives of the ordinary
working Americans. This is why the loss of manufacturing jobs, the best
paying jobs in our economy, particularly for blue collar Americans,
this is why it has happened, because this is why the family median
income in real terms adjusted for inflation has gone down almost every
month since 2001.
So beneath the glitter and generalizations are some stark facts that
don't really appear to support the claims the Bush administration has
made. Namely, they have created just over 2 million jobs, whereas the
Clinton administration created 22.8 million jobs during his time in
office. And they have presided over a devastation in the number of
manufacturing jobs, a loss of 2.9 million manufacturing jobs in our
economy.
Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
One additional way to look at our economy and to see how it compares
with what we may have seen around the rest of the globe is to simply
look at the statistics as to how our U.S. economy has performed as
compared to some others. For example, when we look at real GDP growth
from the first quarter of 2001 through the fourth quarter of 2005, the
U.S. economy expanded at an average annualized rate over all of those
times, even though it was slow during the earlier years, at 2.6
percent, and the United States ranked first among its peer group in the
world in real GDP growth.
[[Page H1582]]
In terms of investments of fixed assets, from 2001 to 2005, growth
investments in fixed assets as a percentage of GDP growth rose in
Canada and the United States but fell in the European Union and Japan.
And so once again, the United States was a leader in terms of
investment and fixed assets.
In terms of industrial production from 2001 to 2005, through 2005,
the United States industrial production increased by 7.1 percent, a
very, very healthy picture. And I might add that this industrial
production increased because of investments, because of investing in
productive things, investment brought about by the budgetary policy and
the tax policy of the Congress of the United States and the
administration.
Employment and unemployment. From January 2001 through December 2005,
the United States ranked second in employment growth in both absolute
and in percentage terms. In the United States employment grew by
5,165,000 jobs, or 3.8 percent. Canada ranked first in percentage
growth with 9.3 percent, while the European Union ranked 15, first in
total increase of 5.7 million, which was actually 3.4 percent, far
below the United States.
In December of 2005, the U.S. had an unemployment rate of 4.9
percent, the second lowest among its peer group. If we look at this
chart next to me of unemployment rates, if you look at the unemployment
rate in the European Union, it was 8.3 percent. If we look at the
unemployment rate in Canada, it was 6.4 percent. And at the end of the
year, same time frame, the unemployment rate in the United States was
4.8 percent.
Just interestingly enough, there is a member of the U.K. Parliament
in town today, and I saw him early this morning and he said, I envy
you. I said thank you, and why is that? He said, when I go to work at
home and I earn an income for my family, 59 percent gets paid to the
government. I envy us, too, because we have seen beyond the period of
high taxes. We have seen beyond the period of producing an economic
policy that in Europe provides today for an 8.3 percent unemployment
rate or in Canada of a 6.4 percent unemployment rate. We are fortunate.
But it is because of good policy. It is because of the policy of this
administration and this Republican Congress that we have a 4.8 percent
unemployment rate.
Labor productivity is up in our country as well, and that is one of
the reasons for this great economic growth. From the first quarter of
2001 to the fourth quarter of 2005, labor productivity grew by 9.5
percent. That means that because of technology that we have invested
in, smartly, and partly because of tax policy, we have made our workers
more productive than at any time in our history and the most productive
work force in the world.
I said a word a few minutes ago about price stability. Price
stability is what it is today, lack of inflation, inflation of 2
percent or under, because of Fed policy. Chairman Bernanke told me
earlier this week that he intends to continue policies that have price
stability as the number one goal as inflation targeting continues, to
keep our rate of inflation low and to keep interest rates low
accordingly. Smart economic policy.
And so as we walk through the things that have occurred, partly
because of the Congress and partly because of the Federal Reserve, we
see that things in our country are doing well, particularly when
compared to others.
On balance, the U.S. economy has outperformed its peer group and
large developed economies in a number of key measures of economic well-
being between 2001 and 2005, during the period that George W. Bush has
been President.
Pro-growth tax policy and good monetary policy have contributed to
the superior performance of the U.S. economy, and as my friend from the
U.K. Parliament said today, yes, we are proud of this record.
Mr. Chairman, I reserve the balance of my time.
Mrs. MALONEY. Mr. Chairman, I yield 4 minutes to the gentleman from
Maryland (Mr. Cummings), a member of the Joint Economic Committee.
Mr. CUMMINGS. Mr. Chairman, I rise to join my Democratic colleagues
on the Joint Economic Committee in condemning the Republican leadership
fiscal year 2007 budget before us today.
Since President Bush took office our Nation has experienced the
greatest average annual decline in household income during any
administration since 1960. Not surprisingly, more Americans live in
poverty and more lack health insurance now than when Mr. Bush took
office.
The economic choices our Nation has made have fallen particularly
hard on African Americans. According to the United States Census Bureau
in 2004, households headed by African Americans had the lowest median
income of any racial group. Poverty among African Americans reached
nearly 25 percent, while nearly 20 percent of African Americans lacked
health insurance.
The United States Department of Labor reports that the unemployment
rate among African Americans has risen 13 percent since President Bush
took office, and stood at more than 9 percent in December 2005, which
is more than twice the unemployment rate among white Americans.
Confronted with this situation, in which the potential of an entire
generation of African Americans could be lost to rising poverty and
joblessness, the House has presented us with a budget resolution that
would cut $447 million from the amount needed just to maintain the
current level of services provided to assist primarily low wage workers
and vulnerable families, such as housing assistance for people with
disabilities and the elderly, food programs that help low income
elderly and mothers and children, job training programs that help the
unemployed, and child care assistance.
Confronted with this situation in which 13 million American children
live in poverty, including 9 million African American children, the
House has presented us with a budget that will result in several
hundred thousand low income working women and their children losing
their health coverage through a failure to fill a funding shortfall in
the States' Children Health Insurance Program.
The House has presented a budget resolution that would add $348
billion in fiscal year 2007 to our ballooning deficit to extend tax
cuts totaling $228 billion that will continue to go primarily to the
wealthy. In fact, according to the Tax Policy Center, during the years
2007 through 2016, 29 percent of the tax cuts that have been enacted in
the individual income tax, the estate tax and the Alternative Minimum
Tax since 2001, will go to the top 1 percent of earners while the
bottom 60 percent of households will receive just 14 percent of tax
cuts.
Mr. Chairman, the budget before us is simply unconscionable and the
financial policies it continues are unsustainable.
I urge my colleagues to recognize our true priorities lay with our
people and placing our country on a sound economic footing. I therefore
urge my colleagues to join with me in rejecting this budget.
Mrs. MALONEY. Mr. Chairman, I yield 1 minute to the gentleman from
Texas (Mr. Gene Green).
Mr. GENE GREEN of Texas. Mr. Chairman, more than any single piece of
legislation we passed this year, the budget reflects our Nation's core
values. Unfortunately, this budget values deficits over balanced
budgets and tax cuts over the health and education of the American
people.
This budget cuts more than $10 billion from critical domestic
programs our constituents rely on every day. By eliminating 42
educational programs, the budget fails our children and wastes our
opportunity to invest in their future.
It hurts low-income students' shot at the American dream by wiping
out the GEAR-UP program that prepares them for college.
It threatens our future economic competitiveness by eliminating
vocational programs to help our students gain skills in the global
economy.
There is so much in this budget that is wrong this cannot actually
represent the value of this Congress and the values of the American
people because of what it does.
{time} 1300
It cuts the budgets of 18 out of 19 institutes of the National
Institutes of Health. It raises deductions and copays for veterans
health care.
Mr. Chairman, there is so much wrong with this budget that one thing
[[Page H1583]]
it does, it continues the tax cuts, and that is why it is not the
American values.
Let us help our children, our veterans, and our elderly without
giving tax cuts.
Mr. Chairman, more than any single piece of legislation we pass this
year, the budget reflects our Nation's core set of values.
Unfortunately, this budget values deficits over balanced budgets, and
tax cuts over the health and education of the American people. This
budget cuts more than $10 billion from critical domestic programs our
constituents rely on every day.
By eliminating 42 education programs, the budget fails our children
and wastes our opportunity to invest in their future. It hurts low-
incomes students' shot at the American Dream by wiping out the GEAR-UP
program that prepares them for college. It threatens our future
economic competitiveness by eliminating the vocational education
programs that help our students gain the skills to compete in a global
economy.
This budget breaks our commitment to military retirees by
increasing--and in some cases tripling--their out-of-pocket health care
fees. It abandons our quest for health care research and discovery by
cutting the budgets of 18 out of 19 institutes within the National
Institutes of Health. It cuts programs aimed at preventing illness and
disease while also slashing programs that train health professionals to
treat these diseases.
As a country at war, there is no doubt that we have to make
sacrifices to successfully implement the war on terror and equip our
troops. But the funding cut from domestic programs in this budget does
not go for war costs. In fact, war costs aren't even included after
2007.
The funding cuts also aren't being used to balance the budget. With
this budget, this country will post a deficit of $348 billion for
2007--one of the largest deficits in our Nation's history.
Instead of funding war costs or paying down the deficit, the cuts in
this budget are used for tax cuts; $228 billion in tax cuts for the
wealthiest Americans when families are in need here at home, and troops
are putting their lives on the line far from home.
Mr. Chairman, at best this budget is misguided. But the truth is,
this budget is down right immoral, and I urge my colleagues to join me
in opposition to it.
Mr. SAXTON. Mr. Chairman, I yield such time as he may consume to the
gentleman from Michigan (Mr. McCotter).
Mr. McCOTTER. Mr. Chairman, I come from a Midwest State, from
Michigan, home of the auto industry. And while my district is
relatively doing well, according to the unemployment figures that have
been released, I can assure you that Michigan as a State is not doing
well. There are several reasons for this, which the place here is not
to debate. But the thing that I ask as a Member from Michigan is that
we do not make it more difficult for the people of Michigan to right
the ship and to begin our path to an economic renaissance.
Struggling pockets of poverty and struggling pockets in the
manufacturing base in Michigan and the Midwest and other parts of this
country can never be revitalized or returned to their prominence if we
deviate from the economic path we are on today, because if the American
economy goes back to a higher system of taxation, a system that then
crushes entrepreneurial initiative and the individual genius of the
American worker, States like Michigan will never recover.
We need to continue the economic expansion in this country. We need
to continue to follow pro-growth policies, especially in the area of
taxation. We do not give anything to anyone. We merely allow them to
keep what they have earned so that they can then directly invest in the
future of their children, of their community, and of the life of this
country.
So, Mr. Chairman, I welcome this debate on the budget. I welcome the
debate about the priorities. But I would encourage us to continue the
path because of the several fundamental assumptions that the current
policies that we, as the Republican majority, have adopted. I think
they must continue because they are very prescient.
The first, and I reiterate, is that tax relief does not give anything
to anyone. It allows people to keep the fruits of their hard work. That
is not a gift. It is a recognition by government that people who
generate wealth should be able to invest it for the betterment of
themselves and their family and their community.
Secondly, history has proven to us that as the taxation rate
continues to escalate, what happens then is money that is more
productively invested into the life of the American community is then
less productively spent when it is vicariously handled and invested, or
spent, by the United States Government.
Thirdly, I would like to point out that when we talk about
government, there are objections about Republican fiscal policies that
government has to pay for things. The third root assumption, I think,
that our economic policies follow, which must be continued, is that
government pays for nothing; working people pay for everything.
So I would encourage us to remember that we live in a sovereign
democracy, a democratic Republic where your private property is your
private property until the government gets it through the consent of
you, the governed. Government then holds your money in a pool,
collectively in trust, to be expended on behalf of you and your fellow
citizens.
So let us not forget that, as we discuss taxation policy, because
when we are essentially asking to deviate from the tax policies of pro-
growth that we have today where people keep what they earn, we are
beginning to forget the fact that the United States Government does not
create wealth, the United States Government does not pay, the United
States Government is not the repository of property to be dispensed
back to people.
The American people have private property rights, and they have the
unalienable right to keep the fruits of their labor. Our policies
reflect that, and I believe that the American economy, this
entrepreneurial energy, has been unleashed because of these policies.
And I conclude by again reiterating my commitment and my hope that
this collective Congress continue the path we are on so that States
like mine can continue the path to recovery.
Mrs. MALONEY. Mr. Chairman, I yield such time as he may consume to
the gentleman from New York (Mr. Hinchey).
Mr. HINCHEY. Mr. Chairman, I thank my friend and colleague from New
York for her leadership on this Joint Economic Committee.
As we have heard over the course of the period of this debate, we
have had in the last 5 years huge amounts of economic stimulation in
this economy. The amount of economic growth dropped off sharply when
the Republican Party took control of both the executive and the
legislative branches of government in 2001. With the cooperation of the
Federal Reserve, huge amounts of monetary stimulation were injected
into the economy, and they dropped the interest rates to zero. And this
Congress engaged in a spending program which was enormous, huge amounts
of spending coming out of these congressional resolutions, these budget
resolutions and appropriations bills.
That kind of economic stimulation should have been very positive, but
it was not. One of the reasons it was not is because it was done in a
very irresponsible way. It was done by borrowing huge amounts of money,
and that borrowing has created record amounts of debt for the American
people, which they will have to pay back over the course of
generations.
As we have heard, the national debt now exceeds $8 trillion, and the
majority party has risen that level to almost $9 trillion. With that
kind of economic stimulation, huge amounts of spending and very low
interest rates, we would have had every reason to anticipate that
unemployment would drop, that more and more people would be employed,
that they would be employed progressively, that their wages would be
increasing, and the economic circumstances for the American workers and
for American families would have gone up, except that, as I pointed
out, it was done so irresponsibly so that most of the benefits have
gone to the wealthiest people in this country and little or no benefits
have gone to the middle class.
So the effect has not been that we have cut unemployment and
increased employment. We now have 1.2 million more people in America
who are unemployed than there were 5 years ago.
Long-term unemployment is even worse: 1.4 million Americans are
suffering long-term unemployment.
[[Page H1584]]
They have talked about job growth. Well, of course there has been
some job growth. What has that job growth been? It has averaged about
38,000 jobs a month. Normally, even without that huge amount of
stimulation, that huge amount of spending, normally what we have in
America is job growth at the rate of 125,000 to 150,000 jobs a month.
Job growth under their economic program has been down to 38,000. That
is why we have more and more people unemployed, short term and long
term.
Manufacturing jobs, the essence of our economy, the most important
aspect of our economy, manufacturing jobs, have gone down by 2.9
million jobs since they have taken over both the executive and
legislative branches of government. Real wages for working people in
this country have not gone up as you would expect with that kind of
huge amount of spending, but real wages have fallen in the past 2
years. In fact, in the last 2 years, they have gone down by nearly 1
percent after inflation for American families.
So the budget resolution that we are seeing today is consistent with
the economic policies that the Republican Party has put forth over the
last 5 years, which have been so devastating to the American economy,
to American workers, and to American families. And that is the reason
why this budget resolution must be defeated.
Mr. SAXTON. Mr. Chairman, I yield 2 minutes to the gentleman from
Missouri (Mr. Hulshof).
Mr. HULSHOF. Mr. Chairman, I appreciate that, and I appreciate the
leadership of the gentleman from New Jersey.
Let me just say to the last speaker, nothing done for middle-income
families? Consider that 5 million taxpayers have completely had their
income tax liability removed. In fact, they pay no income tax liability
to the Federal Government anymore after these pro-growth tax
initiatives.
Mr. Chairman, I was listening to this debate, and I have to tell you,
as someone who was an economist at the University of Missouri Columbia,
I remember sitting in those, some would say, boring lectures. I was one
of the few that actually enjoyed those lectures. But it used to be
thought that if you had the unemployment rate in America certainly at 5
percent, it was considered to be full employment. We have a 4.8 percent
unemployment rate. As has been rightly pointed out, inflation has been
kept in check. We have homeownership at an almost all-time high.
Consider the fundamental underpinnings of this economy.
And my friend from South Carolina, whom I have great respect for, I
was listening to your discussion as well, and you acknowledged at least
there has been some job creation; and you talked about the 8-year
period of time under the previous administration, and we are at a 5-
year point here as far as this administration. But consider what this
President inherited. Certainly everyone can agree, when you put the
partisanship aside, if you can, that the economy was slowing in the
last 2 years of President Clinton's administration. Then you consider
actually what happened as far as the tech bubble bursting, corporate
scandals that rocked the confidence of the investor class, the shock
that the economy took on September 11.
Clearly, we had the horrific human tragedy but, of course, the
economic tragedy as well, plus trying to respond to Katrina and the
multiple catastrophic events that we have attempted to do. When you
consider we have weathered all of those storms, so to speak, and we
have unemployment at 4.8 percent, inflation less than 3, homeownership
and all this other positive economic news, and the fundamentals are
there, I recognize again that the loyal opposition must be loyally
opposed and to your political peril that you would talk up the economy.
But I would just simply say that in this intensely partisan political
time, at least give credit where credit is due.
I thank the gentleman for yielding.
Mr. SAXTON. Mr. Chairman, just to conclude this debate, it was not a
Republican idea originally to stimulate economic growth by use of the
tax policy. It was John Kennedy's idea. When Ronald Reagan was elected
President, we Republicans all stuck our chests out and said what a
wonderful idea. But it was John Kennedy, who, in his State of the Union
speech after he was elected, said we cannot expect to continue to lead
the economic world if we fail to set the economic pace at home. And he
went on in his speech to detail the tax cut plan that he wanted to put
in place. It was put in place and the economy grew. And Ronald Reagan
did the same thing. A different plan, same concept. And George Bush I
did the same thing, and George W. Bush has embarked upon the same
thing.
Now, it has been suggested by the minority that somehow we can have
tax cuts without cutting taxes of people who pay taxes. This chart to
my left shows who pays taxes. As a matter of fact, the top 1 percent of
the taxpayers pay 34 percent of the taxes. The top 50 percent of the
taxpayers pay 96 percent of the taxes. And that means that about 4
percent of the personal income taxes that are paid in this country are
paid by the bottom 50 percent of the wage earners. As Mr. Hulshof just
pointed out, many of those folks have been taken off the tax rolls
altogether.
{time} 1315
So the charge that people who earn more money get a larger share of
the tax cut, I guess I would just ask this question: If you believe, as
I do, that tax cuts stimulate economic growth, and if you are going to
have tax cuts at all, then you have to cut taxes from the people who
are paying them, and they are almost all in the upper half of the
income brackets.
The CHAIRMAN. All time on this part of the debate has expired.
It is now in order to conduct general debate on the congressional
budget. The gentleman from Missouri (Mr. Hulshof) and the gentleman
from South Carolina (Mr. Spratt) each will control 90 minutes.
The Chair recognizes the gentleman from Missouri.
Mr. HULSHOF. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, today is a great day, a great day of opportunity for
this House and really for the American people. I want to echo what was
said during the previous debate, particularly by my good friend and
colleague Mr. McCotter from the State of Michigan.
I want to start by actually announcing a truism that certainly all of
us, Republicans, Democrats, Independents, liberals and conservatives
can agree with, at least I believe it to be a truism, and it would be
simply summed up in two statements:
First of all, wealth and prosperity and economic opportunity do not
come from government programs or increased Federal spending. Isn't that
at least something we can begin to agree upon?
The second corollary that again I think is axiomatic that again
surely all of us can agree with, is, secondly, the Federal Government
cannot tax its way into prosperity.
So when you consider where we are, as we try to make these very
difficult, tough budget choices, I believe that the budget that we have
on the floor today should deserve bipartisan support. I don't expect
it, but it should.
This fiscal year 2007 budget continues and furthers our plan to
strengthen our Nation's most critical programs. It reforms the Federal
Government. It spends the taxpayers' dollars wisely.
Again, I am certain that as we over the next couple of weeks go to
visit with our constituents, those folks that are actually paying the
bills, they simply want to be assured that they are getting a dollar's
worth of value out of every dollar that they send to the Nation's
Capital. This budget does that, and in fact it does it by focusing on a
number of priorities.
We build upon our Nation's greatest strengths. We continue our
successful pro-growth policies to ensure that our economy, that has
been doing well, job creation that has been increasing, remains strong
and that we continue that vibrant economy.
We also accommodate the administration's request to provide whatever
is needed in the way of resources to support our troops, again
something that I think both sides of the aisle will agree with. We have
to continue to keep our Nation's defense and security the strongest in
the world, especially at this very critical time.
But we will also continue our efforts at controlling spending across
the board. We want to restrain the nonsecurity discretionary spending
programs. We want to build on our progress to reform and find savings
in
[[Page H1585]]
some of these mandatory programs that are on autopilot, if you will.
In addition to furthering those reforms to improve our Federal
Government programs, it is time again to begin to reform the budget
process itself to better reflect and address how Federal Government
dollars are actually spent.
When we had our interesting markup last week in the Budget Committee,
and I suspect as we heard that night, again, the loyal opposition is
likely to provide a somewhat schizophrenic argument. On the one hand
they are going to decry the fact that this budget does nothing as far
as the Federal deficit and adds to the Federal debt. In other words,
they are saying that this budget, we spend too much. And probably then
in the second sentence, they will say ``and it doesn't invest enough in
certain programs.''
In other words, our friends across the aisle will talk about that the
budget spends too much and then it doesn't spend enough. Certainly I
would say that covers all the bases.
We think that this is a responsible budget. It focuses on our
priorities, our strengths. It keeps us on a pro-growth agenda to keep
this economy growing, because as we realized back during the days of
the 1990s, with the Democratic President and a Republican-led Congress,
we were able to make some significant progress. But it wasn't just
Congress. It was those hardworking men and women across the country,
the laborers, the farmers, the manufacturers, the lumberyard dealers,
the tool and die makers, those in the service industry, those folks
that punch the clock every day, go to work, play by the rules, pay
their taxes and simply want the best out of government that they
deserve. We think this budget accomplishes that, and I urge its
support.
Mr. Chairman, I reserve the balance of my time.
Mr. SPRATT. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, in describing the difference between Republicans and
Democrats, between them and us, when it comes to the budget resolution
for 2007, let me go straight to the bottom line: We have got a
manifestly better bottom line.
The Democratic substitute returns the budget to balance in the year
2012. Building on our reputation for fiscal responsibility which we
established in the 1990s during the Clinton administration, every year
the bottom line of the budget got better and better and better until
the year 1998 when we had a surplus and the year 2000 an unprecedented
surplus of $236 billion. That was the year before the budget was handed
over to President Bush, and it has gone downhill ever since.
So what is the difference between us on the bottom line? The
Democratic budget resolution returns the budget to balance by the year
2012.
In the interim, our budget runs smaller deficits and racks up less
debt. Not by a huge amount, but by a significant difference. The
Democratic resolution also holds nondefense domestic discretionary
spending to the level of current services over 5 years, showing that we
can exercise spending control without devastating vital services and
programs that people dearly depend upon.
The Republican resolution, as I said, never reaches balance and
presents no plan or prospect of ever wiping out the deficit or reducing
the debt.
The Republican budget resolution in fact would make the deficit worse
by $410 billion over 5 years than would just a basic, current services
treadwater budget.
OMB projects a deficit for this year, 2006, of $423 billion. House
Republicans project a smaller deficit of $372 billion, and they project
this deficit to decline to $348 billion in 2007, showing a bit of
improvement. But these projections still mean that on the watch of
President George Bush the five largest deficits in our country's
history will occur. The five largest deficits in our country's history
will occur on the watch and administration of President Bush.
To make room for the Bush administration's budget, four times
Republicans in the House and Senate have raised the debt ceiling of the
United States by $3.015 trillion. They have raised the debt ceiling by
over $3 trillion between June of 2002 and March of 2006.
Under the Republican budget resolution, the statutory debt ceiling
will increase by an additional $2.3 trillion by 2011. This means that
debt ceiling increases from 2002 to 2011 will equal $6 trillion, and
the statutory debt will stand at $11.3 trillion, more than doubled over
the 10-year period 2002 to 2011, from $5.3 trillion when President Bush
took office to 2011.
We can talk about budget in terms of fiscal policy, we can talk about
it in terms of budget policy or just plain accounting issues, should we
have accrual budgeting or cash budgeting, but here is the bottom line.
This budget is a moral document, and the choices it makes, for whom it
helps and whom it hurts, but, more importantly, in the debt it
accumulates which we hand over to our children.
Are we going to be the only generation in recent American history
which bequeaths to our children this dreadful legacy of debt,
mountainous debt, $11.3 trillion by 2011? Today we will make the
decision once again as to whether or not that is going to be the legacy
we leave our children and grandchildren.
To discuss this further, I now yield 6 minutes to the gentleman from
Tennessee (Mr. Cooper) and request when his time comes, he can use this
time and allot it to the other Members of the House.
The CHAIRMAN. The gentleman is recognized for 6 minutes. During that
time, he may yield to others while remaining on his feet.
Mr. COOPER. Mr. Chairman, I thank my friend from South Carolina for
yielding. He is one of the great Members of Congress of our time, and
this is a vitally important debate.
Our first speaker on our side talking about fiscal responsibility
will be my good friend and colleague from Wisconsin (Mr. Kind), for 1
minute.
Mr. KIND. Mr. Chairman, I thank my good friend from Tennessee for
yielding me this time, and I commend him for his leadership in trying
to institute budget reforms and instill fiscal discipline in the
budgeting process.
Listen, we are going to have a very vigorous debate over the next
couple of days in regards to the priorities and the values of our
Nation, as it should be. People are entitled to their own rhetoric,
they are entitled to their own spin, their own opinion, their own
ideology, but we are not entitled to our own facts, and the facts
couldn't be more stark or more different in regards to the leadership
on our budget under Democratic leadership versus the current
administration.
As this chart demonstrates, it shows the trend line for budget
deficits and budget surpluses, and this upward trend during the 1990s
under the leadership of Bill Clinton and Democrats indicates pay-as-
you-go rules as they existed for the administration and Congress which
led to 4 years of budget surpluses when we were actually paying down
the national debt.
This cliff, which this red line demonstrates under the Bush
administration, is the administration and Congress operating without
pay-as-you-go rules.
What is so hard to get here? We need to reinstate pay-as-you-go rules
to bring back fiscal discipline and responsibility, as the gentleman
from South Carolina indicated, for the sake of our children's future.
Our budget alternative does that. Theirs doesn't.
We are going to continue this downward trend with deficit spending as
long as we don't get back to the budget basics.
Mr. COOPER. Mr. Chairman, I thank my friend from Wisconsin.
The CHAIRMAN. The gentleman will suspend. The gentleman from
Tennessee was recognized for 6 minutes, during which he may yield to
others while remaining on his feet.
Mr. COOPER. I thank the Chair. I yield now 3 minutes to my friend and
colleague and fellow Blue Dog, the gentleman from Tennessee (Mr. Ford).
The CHAIRMAN. A Member who does not control time, but who only is
yielded time for debate, is free to yield to others while remaining on
his feet. He may not reserve time. Although he may indicate to others
his intent to reclaim the time after a certain point, he may not yield
blocks of time.
Mr. FORD. Thank you, Mr. Chairman, for your admonishment there.
I thank my friend in leading our delegation, Jim Cooper here in the
Congress, and thank him for one skill that he seems to have above many
of us here. It is just called math. When you
[[Page H1586]]
were in younger grades, they called it math. When you got older, they
added some more syllables, they called it arithmetic. But the rules
were the same. You can't spend more than you have.
What has happened here over the last few years is really remarkable.
I grew up around this place because my dad was in Congress for 22
years. He worked closely with Mr. Spratt and a lot of people who are
here now. I was a child, or growing up. I don't mean to date them at
all, but I grew up around them and with them.
There was a time when the Republicans were perceived as the party
that understood math and Democrats were the party that didn't
understand math. Then we elected a President from a little State called
Arkansas and he picked a little Senator from my State named Gore, and
they came to Washington, as Jim Cooper and I know well, and they forced
a different kind of approach on us. And that approach was simply
balance the budget, get taxes down for most Americans, get investments
going up and allow the private sector to do what it does best, which
used to be the mantra of my friends to the right of me, literally and
politically.
Wow, what a difference a few years makes once you get in power and
you have all of that ability to spend money. Everything from pork
spending, and I thank Mr. Cooper for his efforts on the committee for
not embarrassing my friends on the right by forcing them to vote on
that late in the evening about forcing us to include all of the pork
projects, Mr. Chairman, before we voted on them and not allowing people
to slide them into pieces of legislation late into the evening.
We have 16 agencies that you can't audit, or several agencies within
our government that are not auditable. We have yet to ask, and there
was a time when the Republicans would ask these things.
Here we are in 2006 and things have changed. The term ``flip-flop''
was used a lot 2 years ago. The flip-flop is here. We now find the men
and women on this side raising these points and not my friends on the
other side.
I would remind my friends about their great fiscal management. Eight
years before 2000, Mr. Chairman, the U.S. economy added almost 23
million new jobs. That is 237,000 a month. Since 2000, job growth has
slowed to a total of only 2.3 million jobs, or 38,000 a month. The
normal retort is, well, the economy changed and we are at war. We are,
but we have made no adjustments here at the Federal level when it comes
to the government.
I will make one last point.
{time} 1330
Since 2000, the number of Americans living in poverty has grown by
5.4 million people. When the last President was around, I remind you of
the three things he did, he was a Democrat, Mr. Nussle: He abolished an
entitlement program called welfare, he balanced a budget, and he
created a surplus.
Now, as much as you may want to criticize him and us, math does not
lie. And you all are faced with a predicament that I would hate to be
in, and perhaps if I had to make the case you are making I would throw
it all back on us and try to create funny numbers and talk about debt
as the size of the GDP.
You cannot deny this. Bill Clinton abolished that entitlement
program, he created a surplus, he balanced a budget. And,
unfortunately, under your leadership, all of those things frankly have
been abolished.
Mr. COOPER. Mr. Chairman, in the time remaining, I am a Blue Dog, I
am cochair of the Blue Dogs. Every Blue Dog has a sign outside his or
her office that lists the debt, $8.3 trillion, and each American's
share of that debt.
It is very important that all Americans recognize the liabilities
that this administration has added to our backs. Mr. Spratt said
earlier, $3 trillion of this have been added just in the last 4 or 5
years. It took America the first 204 years of its history to get $1
trillion in debt. Now we are doing it about every 18 months.
But don't take my word for it. Don't take the Blue Dogs' word. Look
at a book just written by one of the most conservative Republican
economists in America, Bruce Bartlett. It is called ``Imposter: How
George W. Bush Bankrupted America and Betrayed the Reagan Legacy.''
Now, you might say, well, he is a disgruntled economist, although I
would urge everybody who cares about our fiscal future to read this
book.
Look at this one. This is from President George W. Bush's Department
of Treasury, and they are so proud of this document that it was
delivered to this body on Christmas Eve without a press release. In
this document, you discover that the deficit last year was not the $319
billion that these gentlemen will admit to, it was $760 billion, over
twice as large, and the unfunded liability for America approaches $46
trillion. And this is not according to a Democrat or a disgruntled
Republican, this is according to the Secretary of Treasury of the
United States.
So it is a vitally important debate, Mr. Chairman. We need fiscal
sanity to return in this country.
Mr. NUSSLE. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, I am proud to be here as the chairman of the Budget
Committee to propose and debate the budget resolution for this fiscal
year 2007, the blueprint that will guide the Congress' spending and
revenue decisions for the coming year.
It is not easy to write a budget ever. It is particularly challenging
to write a budget when you have to deal with an economic recession,
when you have to deal with the worst terrorist attack that has ever hit
practically any nation, but particularly ours on our own shores. It is
difficult to write one when you are at war, when you have a whole new
priority of homeland security that was never even considered just 10
short years ago, or the largest natural disaster ever to affect the
United States called Hurricane Katrina. It is never easy to write a
budget, and it is particularly challenging to do that when those kinds
of things hit you not just one at a time but all at one time.
Today we are going to hear a lot about politics. You know, there is
this new movement around the country that I think is pretty important,
and that is that we need new science and math education for our kids
because we are falling behind, but I think we probably ought to add
history to that, too.
I love how the Democrats come to the floor today, and this is modern
history for Democrats. In 2001, George W. Bush took office, and look at
the deficit we have today. Nothing happened in between. Of course,
there have been 6 years that have occurred, and during those 6 years we
had those things like an economic recession, like Hurricane Katrina,
like 9/11, like a global war on terror, the need to deal with homeland
security. And all of those priorities not only were cheerfully voted by
both sides, but the national debt not only went up under all of those
votes, but in fact the Democrats proposed even more spending to drive
that debt even higher.
And probably the most humorous conversation was the one I just heard
on welfare reform, how the President is the one who ushered in welfare
reform, President Clinton? This is the same President Clinton who
vetoed welfare reform twice, and in fact had to be dragged kicking and
screaming to support the Republican-passed welfare reform, which was
the first opportunity for us to reform entitlement spending and to deal
with some huge challenges that gave us the first surpluses in history.
So this budget is always going to be a challenge to write, but it is
particularly going to be challenging if all we are going to hear on the
other side is complaints and politics, and not any serious proposals to
deal with it.
Is this budget going to please everyone? No. You have just heard
quite a few complaints about how this budget is not going to please
Democrats, and I can certainly understand why. But this budget takes
into account the conversations that we have heard from our constituents
back home in particular, and I believe this is the budget that is the
right budget and the plan to keep our country moving forward with a
strong growing economy, with a secure homeland, to provide endless
opportunities both today and tomorrow for our kids and our families. It
is guided by what we think are our most important priorities and it is
based on a clear set of principles: Strength, spending control, and
reform. And let me just touch on these briefly.
[[Page H1587]]
First on strength. This budget will further build on our Nation's
greatest strengths, which include our Nation's national defense and
homeland security, and the robust growth of our Nation's economy and
job markets as a result of the plans and proposals that we have passed
on this floor over the last 5 years.
Spending control. This budget will continue our efforts to control
spending across the board by further restraining the nonsecurity
discretionary spending, and building on our progress from last year to
reform government, achieve savings in mandatory entitlement programs.
In addition to those reforms, we also believe that it is time for us
to reform the budget process and continue the work that has already
been done. This budget will begin to reform the budget process by
actually dealing with emergency spending.
And I will come back to all of these, but let me first touch on our
strengths.
The economy. As I just noted, our underlying strength comes from the
Nation's economy, and in the past 4 years, 5 years, it really has
delivered. I mean, we have seen some wonderful things as a result of
the American people being able to spend and invest and use their own
resources. After adjusting for inflation, our economy has grown at a
robust average of better than 3 percent a year since 2003. Nearly 5
million new jobs have been created in America as a result of this
economy, and the unemployment rate has fallen to 4.8 percent, which not
only is historically very low, but by many economists that is
considered full employment. Even in the face of higher energy prices,
which we are working to deal with, and the worst natural disaster on
record, our economy has proven remarkably resilient and strong,
growing, creating jobs, and increasing personal incomes.
Clearly, the real credit for the growth goes to the people who do the
work in this country, who work and save and invest and create jobs and
allow our economy to continue to grow. But we in Congress did support
their efforts by lowering their tax burdens, and this budget continues
that because we believe there should be no tax increases, as opposed to
the Democrats who propose tax increases in their alternative budget.
And we did this because of our fundamental belief that the people back
home really do make better decisions about their daily lives, about
their businesses, about their farms, about their families and
communities than the Federal Government ever could make for them.
As a result of giving Americans more control over their money, we
have seen more investment, more jobs, greater opportunities in our
country, and as a further direct result of this growth from what
Americans have done, revenue has come pouring into the Federal
Treasury. In fact, last year we saw Federal revenues increase by almost
15 percent in one year.
Now, I realize we have got to stop and just highlight this because if
you have been listening to the rhetoric on the other side, you will
believe that the bane of all of our illnesses is because we have
reduced taxes and that somehow tax cuts have caused this government to
fall off its pedestal, when in fact reducing taxes has actually brought
in 15 percent more revenue growth to our Federal Government, and it is
because our economy works. When you are allowing people to keep their
money and invest it on their own, it creates opportunities and jobs and
business development, and as a result of that more people pay more
taxes and that brings more revenue into the government.
In short, our economy has gone from recession just a few short years
ago to a strong sustained period of growth, and to ensure that that
growth and strength continues to be in an upward momentum our budget
does not increase taxes.
Second is national security. This budget will also continue to
provide whatever is needed to support our American troops and to ensure
our Nation's defense remains the strongest in the world. We do not have
a secret plan, as you will find in the Democratic alternative
substitute, that basically says we are not going to fund the war after
next year. It is kind of a secret plan to basically say one of two
options. We are either going to bring all the troops home like the
gentleman from Pennsylvania wants to do or we are not going to fund
them so they are able to claim balance. They have basically put no more
money, no support to our troops in the field over in Iraq and
Afghanistan.
The President's budget, not including war funding, has requested an
increase of 7 percent to ensure that our men and women have the
opportunity to support and defend our Nation and our budget will
accommodate that request. We will also, as we have for the past two
budgets, place $50 billion in reserve to fund those wars in Iraq and
Afghanistan. And we know that it is going to take a commitment in years
to come and we plan to support that commitment, not claim balance and
not have some secret plan that is either going to underfund it or bring
them home before their job is done.
But even as we provide those resources, we also believe that the
administration needs to get the message that we need a full accounting
of how this money is being spent and what the implications are for the
future. Particularly in the area of defense, we have got to do a better
job to ensure that every dollar that we invest and that we put into
this critical area is hitting its intended target. It makes our country
safer. I cannot think of any activity that deserves more diligent
oversight than our national defense.
For homeland security we will provide whatever is needed to ensure
our homeland at the border, in our country, in our cities, in our rural
areas, whatever is needed. The President has proposed 3.8 percent of an
increase and our budget accommodates that request. But just as with
defense, we have got to do a better job in this new Department of
Homeland Security to make sure these monies are being spent wisely and
are actually working to make our Nation more secure.
The second big principle on which we write this budget is controlling
spending. Let's start with what we call ``discretionary spending.''
With the necessary shift of our Nation's priorities to provide for
these areas of, after 9/11 as an example, we have come to employ kind
of a shorthand to effectively divide this discretionary spending into
two categories. Let me do that for people who are watching.
We have security spending, which involves our national defense and
our homeland security, and what we call ``nonsecurity,'' which is
everything else. That is where you will find education, veterans,
agriculture, the environment, et cetera. So you have security and
nonsecurity. And as most of my colleagues will detail in this debate,
we increased our security appropriations funding at a truly incredible
rate over the past few years to deal with the challenges that our
Nation has needed in regard to security.
But that said, when we decided that our Nation's security was our
highest priority, it also meant that everything else needed work and
that everything else must come after, although many seem to regularly
forget the Federal Government simply does not have an infinite supply
of money, nor should it. So when we decide to increase spending in one
area, you have got to determine how to pay for it and how to reduce
spending in other areas. That is what budgeting is all about.
Last year we held our nonsecurity spending to a freeze tighter than
the previous year's 1.3 percent growth and certainly a marked
improvement over the previous 5-year average of 6.3 percent. This year
the administration has asked for a freeze, according to CBO's estimate,
for all the nondefense, nonsecurity spending in our budget. We will
assume that freeze is for nonsecurity spending. We believe that our
security must come first or none of these other programs will matter
much.
That said, it is important to note that while our budget sets an
overall number, it is the Appropriations Committee who determines how
that money is allocated. Clearly there are high priority programs that
receive and should receive increases. But in order to provide those
increases, they have to have offsetting reductions and eliminations of
other programs, and we know the Appropriations Committee can do this
and will do this. Last year alone they eliminated somewhere near 110
specific programs in order to ensure that we fund those programs that
are higher priorities.
[[Page H1588]]
Now, let's get to where the real rubber is going to hit the road with
this budget and where it needs to hit the road.
{time} 1345
This is the funding that is truly out of control.
Our biggest challenge in Federal budgeting is the problem of
mandatory, automatic, entitlement spending. That is now two-thirds of
the budget, and two-thirds of the budget needs some attention. Well, we
provide the attention while the Democrats, you can hear the crickets.
They do not even look at it. There is no reform in their budget for the
mandatory programs. Just do not worry about two-thirds of the budget.
We are only going to talk about one-third, they say.
We need to work on reforming these programs. They are important to
the people back home. They are not always doing the job they need to
do. We need to constantly reform and weed the garden to make sure that
garden can continue to grow and make sure that we can eliminate the
waste, fraud, and abuse in those programs.
Currently, our mandatory spending is growing at 5.5 percent a year.
That is faster than our economy is growing. It is faster than
inflation, and it is certainly faster than any of our means to be able
to sustain it.
To put it another way, if our budget were balanced right now today,
our entitlements would drive it right back into deficit; and so we have
got to deal with these challenges which, of course, are highlighted
probably most dramatically because there are 78 million baby boomers
who are beginning to turn 60 this year, and medical costs are
skyrocketing, and there is a steady decline in the number of workers
for each retiree.
The problem only gets worse. So we have got to address this. We have
got to acknowledge on both sides of the aisle that ignoring this
problem, offering no solution on how to fix it, and fighting against
those who are trying to help is not going to benefit any one person, is
not going to benefit any group. Certainly it is not going to be able to
give us the opportunity to be able to deal with these programs in the
future.
Just throwing more money at programs, my goodness, you would think
somebody would get real, get a more creative budget than this just to
throw more money at things and assume that they are actually going to
work. We need to reform these programs.
Last year, for the first time in nearly a decade, we took the first
step to reform some of these largest programs. We saved $40 billion in
the process. We allowed better delivery of these programs to the people
they were intended for.
This year's budget will continue to build on those savings by yet
again reforming the mandatory programs and establishing that we should,
on an annual basis, reform government, even if it is a small amount.
I know people around here say why are you bothering with $6.8
billion. Well, that may be small to some of you, but it is not small to
the taxpayers who have to pay the bills around here. This budget will
continue to build on those savings by, again, reforming mandatory
programs and establishing this annual process.
Finally, let me talk about reform, which this budget is based on. To
some extent, we are still learning lessons from Hurricane Katrina. We
should continue to always learn the lessons; but one of them that
became, I think, very clear is that if we do not control spending, if
we do not get good control of spending, it becomes very difficult to
manage unforeseen events that inevitably face us.
One certainly could have foreseen that we were going to have a
hurricane. We have them every year. We have them every year that I have
been in Congress; but no one, no one, could have foreseen the
devastation that has occurred as a result of Hurricane Katrina, and no
one would have expected it to be built into anybody's budget. We did
not build it into ours. The President did not build it into his.
Certainly the Democrats did not build it into theirs. In fact, this
year they build no money into their budget for emergencies.
Now, wait a minute. I realize this may surprise you. It was in all
the papers. We had a disaster last year. We had an emergency. We had a
hurricane. Not just a little one, but a big one. Why do we not at least
plan for the little ones? Let us at least plan for the disasters that
we know are coming.
Mr. FORD. We have the same amount of emergency spending that you
have, Mr. Chairman.
Mr. NUSSLE. Mr. Chairman, I believe I have the time, and I have not
yielded.
The CHAIRMAN. The gentleman from Iowa has not yielded.
Parliamentary Inquiry
Mr. FORD. Parliamentary inquiry. Who signed the welfare reform bill
that was passed last century?
The CHAIRMAN. Does the gentleman from Iowa yield?
Mr. NUSSLE. No, I do not.
The CHAIRMAN. The gentleman from Iowa has the floor.
Mr. NUSSLE. Mr. Chairman, I appreciate that.
So while we are continuing to learn the lessons, Congress needs to
plan for it. Congress needs to plan for these emergencies, and our
budget does that. This year, not only will we build in a reform of our
mandatory programs and further restrain our nonsecurity discretionary
spending, but we need to reform the budget process as well to reflect
the actual spending that is currently spent outside of that normal
budget process, and it is called emergency spending, for many natural
disasters where appropriate spending is certainly necessary.
In addition to emergency reforms contained in this budget, we will
continue the process of reforming the budget and reforming the budget
process and how we make spending decisions throughout this year. We
need to tackle earmarks. We need to tackle the sunsetting of programs
that have outlasted their usefulness. We need to deal with line-item
veto, and we will do this throughout this year.
Let me just end by saying this. I do not think I need to remind
anybody about the massive challenges and changes that our Nation has
endured these past few years or the myriad of challenges that lie
ahead. We have had enormous challenges in writing the budget. I do not
shy away from any of them. I know it would be easy for somebody to just
punt.
Well, we decided we were going to meet each one of those challenges
and deal with them, and every single year we have had a plan. Finally,
this year, the Democrats rushed to the floor with a plan and suggest
that they finally now have an idea on how they are going to balance the
budget. We will take a look at that a little bit later.
But we have had a plan every year, and our plan has worked, and we
have been able to manage our deficits and our debt and our taxes and
our economy and deal with so many important priorities in an
appropriate way. We have kept our country going when many people, after
some of these disasters, said our economy was going to collapse, that
we were not going to be as powerful as we were in the past; but because
of the leadership we have provided, much of which started in these
blueprints, we believe we have been able to keep our country growing
and growing strong.
We have seen how the Nation's most fundamental priorities have
shifted dramatically, some by circumstance, some by choice, but they
have shifted; and we have managed through the process as best as we
could.
For the past three budgets, after recovering from the initial shock
of 9/11, we have set a bold plan to shore up and strengthen our defense
and homeland security, to get and keep our economy growing strong and
creating jobs and controlling spending and continuing the process of
reform and reducing the deficit, and the deficit has reduced.
We followed that plan, and adjusting it to last year, making a down
payment on the immense new hurricane spending. We have made real
progress.
But last year's hurricane served as a stark reminder that controlling
the budget does not just happen one day out of the year. It is a long-
term, step-by-step commitment that takes resolve. It takes more than
one person to do it. It takes particularly in extraordinary
circumstances a plan, and that is what we present today, our plan for
fiscal year 2007.
We need to pass it. We need to stick to it. We need to enforce it.
Certainly if there are challenges, we need to adjust to it, but we need
a plan. We need
[[Page H1589]]
to work the plan. We need to enforce the plan, and we need to pass the
plan today.
Mr. Chairman, I reserve the balance of my time.
Mr. SPRATT. Mr. Chairman, I yield myself 2 minutes.
I said earlier that this is an excellent opportunity to show the
difference between Democrats and Republicans. This document does that;
but with respect to national defense, function 050, there is no
difference, because to the dollar we have provided the same amount of
funding as the Republican resolution. There is no difference.
On the other hand, with respect to education, there is an enormous
difference because the Republican budget resolution cuts education by
$45 billion over 5 years below what we call the level of current
service, staying where we are. Last year, for the first time in 17
years, the President requested less for education in 2006 than was
appropriated in 2005; and this year, he asked for an even larger
reduction, $2.2 billion less in 2007 than appropriated for 2006, and
these cuts come on top of big cuts, crippling cuts in federally
guaranteed student loans.
To discuss further the impact and consequences of these enormous cuts
in education, which our resolution does not provide for--we fully
restore education to current services, fully restore the cuts they
would make--is Ron Kind of Wisconsin, a member of the Education
Committee, and I yield him 6 minutes for that purpose.
Mr. KIND. Mr. Chairman, I want to thank my good friend from South
Carolina for the leadership he has provided on the Budget Committee,
and we do want to take a moment to talk about the priorities of our
country, especially when it comes to the investment of the future of
our country, and that is the education of our children.
Mr. Chairman, our country is going to face two of the greatest
challenges in the history of our Nation in this century. One is
securing our Nation against the global threat and the global capability
of international terrorism, but, secondly, it is our ability to remain
the most innovative and creative Nation in the world. That requires an
investment in our children and the quality of education that they are
exposed to.
It is something that we do in our budget alternative, and we do it by
operating under pay-as-you-go rules that will restore us to balance
again by 2012, but by maintaining that important investment in our
children's education.
Their budget punts, in fact, their numbers track the President's
recommended budget, which calls for the elimination of 42 education
programs in our country, including vocational education, gone; Perkins
loans, gone; Safe and Drug Free Schools, eliminated; education
technology and Even Start, eliminated, in what the President is calling
for in the budget.
We can do a better job with our alternative, and we would encourage
our colleagues to support it.
Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman from
Connecticut (Ms. DeLauro), a real champion of our children and to
education in this country.
Ms. DeLAURO. Mr. Chairman, this budget contains massive deficits for
our children and unaffordable tax cuts for the wealthiest Americans at
the expense of middle-class families. Particularly damaging are the
cuts to critical services in education, workforce development, health,
veterans services, and environmental protection.
It fails to include an additional $7 billion so that in fact we can
fund education and health and the other services in the same way that
the Senate, by a vote of 73-27, voted a few weeks ago, funding for the
Community Services Block Grant, Low-Income Heating Assistance, National
Institutes of Health and Pell Grants, programs that touch virtually
every community health center, hospital, school district, and
employment center in the Nation.
Last week, I proposed an amendment that would restore this $7 billion
when the Budget Committee met. It was rejected by this Republican
majority on a party-line vote, and what we are left with are cuts that
would cut cancer research by $40 million.
We tell our kids today, you need to have a post-secondary degree; you
no longer have the luxury of just having a high school diploma because
we exist in a global economy. What they will do is to eliminate more
than 40 education programs, all Federal vocational and technical
education programs. They freeze the Pell Grant.
Education has been about opportunity. They will deny the opportunity
of our youngsters to be able to get a college education.
That is what this budget does. These are Republican priorities. They
are not the American priorities. It is a misguided and it is an immoral
budget, and we ought to support the Spratt substitute.
Mr. KIND. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman
from California (Ms. Woolsey), a real leader on the Education Committee
and a champion for our children throughout the country.
Ms. WOOLSEY. Mr. Chairman, we need to put sanity back into the
Nation's fiscal policies, and this Republican budget just does not do
that. In fact, we continue with their policies to fill the pockets of
the defense contractors while leaving only pennies for nearly every
other priority of this country.
That is why I offered an amendment to the budget that would trim $60
billion in waste from the Pentagon budget, not a single penny, by the
way, from the wars in Iraq and Afghanistan, and put these savings to
work on behalf of the people and programs that truly strengthen
America.
{time} 1400
By cutting outdated and unused weapon systems that were designed to
fight the Cold War, relics that have no place in today's modern
military, we could invest in our national priorities, like education.
We could be rebuilding and modernizing our public schools, or we could
be making up for the President and the Republican Congress's $55
billion of underfunding for No Child Left Behind.
The savings would also be spread to homeland security, cutting the
deficit, a skilled and educated workforce, healthy children, less
dependence on fossil fuels, better fire departments, scientific
progress, and less debt. That is what makes America strong and safe.
Enough is enough, Mr. Chairman. It is time we invested in our kids
and their education, not in Cold War relics. Vote against the
Republican budget.
Mr. KIND. Mr. Chairman, I yield such time as she may consume to a
real leader on education and workforce development issues, the
gentlewoman from Pennsylvania (Ms. Schwartz).
Ms. SCHWARTZ of Pennsylvania. Mr. Chairman, I rise to reject the
borrow and spend policies included in the Republican budget, a budget
that fails to balance the Federal checkbook, ignores our obligations to
Americans, and heaps debt on our children and grandchildren at the rate
of $1 million a minute.
Mr. Chairman, our budget, the Democratic alternative, would balance
the Nation's budget by 2012 through fiscal discipline, something the
Republicans refuse to do. And in contrast to the Republican budget, we
would make the important investments in homeland security, health care,
and services for our veterans.
Specifically on education, we would restore what the Republican
budget does not do. The Democratic budget would in fact invest in
educating our children. It would meet our Federal obligations under No
Child Left Behind and under special education, and it would not pass
along these costs to our local and State governments. It would help
young adults be able to get the advanced education needed to have the
skills and the technology to be able to compete in the 21st century.
We should reject the Republican budget and support the Democratic
alternative.
Mr. NUSSLE. Mr. Chairman, I yield 2\1/2\ minutes to the distinguished
chairman of the Veterans' Affairs Committee, the gentleman from Indiana
(Mr. Buyer).
Mr. BUYER. Mr. Chairman, this budget with regard to the funding of VA
is derived from what I call the crucible of hard lessons. I chose to
leave the Veterans' Affairs Committee to examine the budget modeling
issues for the VA.
A budget shortfall was exposed last summer. VA Secretary Nicholson
and OMB, to their credit, stepped up to the
[[Page H1590]]
plate, taking accountability for a flawed budgetary process. Their
improved use of timely data, methodology, and balanced policy
expectations are reflected in the President's budget request for the
VA.
The budget before us today reflects our priorities: To care for
veterans who need us most, those hurt and disabled by their military
service, those with special needs and the indigent; to ensure a
seamless transition from military to civilian life, and to provide
veterans with economic opportunity to live full and complete lives.
The veterans spending has increased from $48 billion in 2001 to
approximately $70 billion this year. At a time of tough budget choices,
when in most Federal spending we see few, if any, increases, veterans
spending will rise next year by 12 percent. With the Nation at war,
this is altogether fitting.
We have heard the rhetoric that describes an increase as a cut, but
truly this budget continues a decade-long record of leadership under
this majority. I refer here to the chart that shows the historic
increases, from the $17.6 billion in 1995 to now $33.8 billion for
discretionary spending alone. This is a far cry from the flat-lined
budgets that we were receiving during the Clinton years.
We have increased the access to quality care, with more than a
million veterans using the VA than they did 5 years ago. But challenges
remain. The VA must decrease its claims backlog with regard to benefits
claims, which exceeds around 800,000. Centralizing the VA's information
technology structure is very important. You can't just measure
compassion by the dollar. It is how we look at the operations of
government. And centralizing the VA's information technology could save
an estimated $1.2 billion over 5 years, according to testimony by
Gartner, the consultant.
Also, to achieve a seamless transition to our new veterans in the VA,
VA and DOD must fully share in the electronic medical records. This is
extremely important and there is good progress in this area.
I want to continue to work with the chairman of the Budget Committee
on issues of modernizing the GI bill, which we have discussed, and also
the issue with regard to the estimate that the administration used with
regard to collections. It is an issue I will work with the chairman on
as we go to conference with the Senate and, hopefully, we can get that
worked out.
I want to applaud the chairman's efforts on behalf of America's
veterans. This is a good budget.
Mr. SPRATT. Mr. Chairman, I yield myself 1 minute.
Mr. Chairman, with respect to veterans' health care there is also a
big difference. The President's budget funds veterans' health care at
$12.5 billion below the Democratic Alternative over 5 years, and on top
of that the President calls for veterans to be assessed a $250 fee to
enroll for care at a VA Hospital.
In the markup in our committee, House Republicans raised funding for
2007 by $2.6 billion above current services. But from 2008 through
2011, the Republican budget resolution cuts veterans' health care by
$8.6 billion less than what CBO estimates is needed to maintain current
services. By contrast our resolution, the Democratic resolution,
maintains funding every year at the CBO level of current services from
2008 through 2011.
Here to discuss further the impact of the two budgets upon veterans'
health care is a Member who knows all about this. He is the ranking
member of the appropriations subcommittee with jurisdiction on this
matter.
Mr. Chairman, I yield 6 minutes to the gentleman from Texas (Mr.
Edwards).
Mr. EDWARDS. Mr. Chairman, I have had the privilege of representing
over 40,000 Army soldiers who fought in Iraq. I have seen firsthand
their sacrifices and the sacrifices their children and spouses have
made on behalf of our country. That is why I believe we have a moral
obligation to support our veterans and our military retirees, and we
should support them not just with our words but with our deeds.
It is the right thing to do, because our veterans have kept their
promise to defend our country and we should keep our promise to provide
health care for them. And it is the smart thing to do, because if we
break our promises to our veterans and military retirees we will never
recruit the best and brightest of the younger generation to fight our
war on terrorism.
That is exactly why I am adamantly opposing this budget. While on the
issue of veterans it has a 1-year fig leaf plus-up of VA health care,
for which I am grateful and supportive, the fact is that this budget
resolution would cut present services for veterans' health care by over
$5 billion over the next 5 years. That is right, this budget resolution
would cut veterans' health care services during a time of war. If that
is not immoral, I do not know what is.
The fact is that it is even worse than that, because the
Congressional Budget Office baseline assumes there is no net increase
in the number of veterans going into the VA health care system every
year. So if you build in 100,000-plus additional veterans we have had
in that system each year, the cut is even deeper than $5 billion to
veterans' health care during a time of war.
Let us talk about military retirees, men and women who have served
our country in uniform, gone into harm's way, served in the military
more than 20 years, many of them over 30 years. What does this budget
do to them? It puts in effect a tax on military retirees' health care.
For retired military officers this would amount to nearly a $1,000 a
year retiree health care tax, and for enlisted retirees a $500 a year
tax on the military retiree health care premiums.
Does it ask Members of Congress to triple our health care premiums?
No. Does it ask members of the President's cabinet to triple their
health care premiums? No. What this budget resolution does say is that
those of you who have served our country for 20 or 30 years in the
military, you are going to have to suck up the burden. You are going to
have to pay for the cost of this Republican budget.
I don't think that is fair, and I don't think the American people
will think it is fair. I certainly know the Military Officers
Association of America, the Disabled Veterans Association, and numerous
veterans organizations have said this is not fair.
Let me just quote Joe Violante, the Legislative Director of Disabled
American Veterans, on this proposal. ``Providing needed medical care to
military retirees is a continuing cost of national defense and is our
Nation's moral obligation. No condition that military retirees be
forced from a benefit they were promised is acceptable, especially in
these times.''
What did the Budget Committee do? On a party line vote they voted
down my amendment that would have said no to the administration's
proposal to triple these military retirees' health care premiums over
the next 2 years. We could have said ``no'' to that unfair burden, but
my Republican colleagues on the committee voted against my amendment.
By doing so, they assume the President's extra revenue from those
health care premium increases and put that into their budget.
Cutting veterans' health care by over $5 billion in the next 5 years
during a time of war, putting a tax on health care premiums for
military retirees is no way to show respect for our military or to
strengthen America. That is why we should say ``no'' to this budget
resolution.
Mr. Chairman, I reserve the balance of my time.
announcement by the acting chairman
The Acting CHAIRMAN (Mr. Foley). The gentleman from Texas may not
reserve time. The remaining 2 minutes are yielded back to the gentleman
from South Carolina.
Mr. NUSSLE. Mr. Chairman, I yield 2 minutes to a distinguished member
of our committee, the gentleman from Texas (Mr. Conaway).
Mr. CONAWAY. Mr. Chairman, I would like to talk a little about the
role of government in a growing economy.
To my way of thinking, that role is to just basically get out of the
way. A growing economy is one in which the Tax Code is in a
circumstance where it is not an overt burden on it. Not to say that our
current Tax Code is perfect, by any stretch of the imagination, but
these low tax rates and these tax concepts we put in place in 2001 and
2003 have in no small part added to the growing economy that we
currently have.
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We don't want to talk today about the regulatory burdens and
interference that families and businesses have from government, but
those should be counted in the cost as well and get those out of the
way.
When you put the pro-growth policies in place that we have had, you
get some startling results. We have 17 straight quarters of growth, as
measured by the GDP. We have 5 million new jobs that have been created.
Unemployment across the Nation is at 4.8 percent, which many think is
full employment. Actually, in District 11, which I represent, the
unemployment rate is zero, for anyone who wants a job. And a record
number of Americans are working today. A record number of Americans are
working and paying taxes.
A little aside on the importance of a job, I spent a lot of time in
west Texas working on United Way issues and other social service
issues, and it has been my experience that when a family has a job that
family is better off. That family is able to provide for itself, to
make its own decisions about how it wants to conduct its life, and when
those individual families are better off then the neighborhoods are
better off and the communities are better off as well. So 5 million
jobs should not go unnoticed as a startling number in a growing
economy.
In conclusion, I think we see that the pro-growth tax policies we
have put in place have created record revenues. We will collect more
money this year than in any other year in our Nation's history,
collecting and growing it in the correct way, more taxpayers paying tax
rates at a lower number.
What we have is a spending problem and not a revenue problem. This
budget addresses discretionary spending in a modest way, and it also
addresses the mandatory spending in an even more modest way. But they
are steps in the right direction, and this new mandatory spending will
be the first time ever we have done it twice in a row, and I urge my
colleagues to support this budget resolution.
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