[Congressional Record Volume 154, Number 36 (Tuesday, March 4, 2008)]
[Senate]
[Pages S1492-S1495]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                               THE BUDGET

  Mr. GREGG. Mr. President, I am going to speak, and then I understand 
the Senator from Texas is going to speak a little bit about the coming 
events of the next 2 weeks which will be the issue of how we address 
the budget of the United States. This is an annual event, of course, 
and so what I am going to give is a little review of last year's budget 
and where we are going with this year's budget. I regret to say it is a 
review of what amounts to basically a horror movie because the budget 
which was produced last year by the Democratic Congress was a horrible 
thing for the American people in the way of increasing taxes and 
increasing spending and increasing debt on the American people.
  Now, we will hear from the other side of the aisle: Well, the 
President's budget does this and the President's budget does that and 
the President's budget does this. However, I think the people who are 
listening to this discussion should understand the President has no 
legal responsibility in the area of the budget and producing the 
budget; that under the Budget Act, the President can send up a budget 
and that is where it stops. The actual budget is produced by the 
Congress of the United States, the House and the Senate. It is not--and 
this is important--it is not signed by the President of the United 
States. He cannot veto it. The budget of the United States is purely a 
child of and a product of the House and the Senate and the U.S. 
Government. So it is our responsibility--not the President's 
responsibility--to produce a budget that is responsible for the 
American people and especially for working Americans, so they are not 
overburdened by the Government, and for our children and 
our grandchildren, so we don't put too much debt on them as a 
government.

  Last year was the first time the Democratic Congress produced a 
budget in 12 years. They had the benefit of the doubt. When they said 
they were going to control spending, people gave them the benefit of 
the doubt. When they said they were going to address the problems which 
we confront with entitlements because of the baby boom generation and 
the cost that is going to be put on our children, people gave them the 
benefit of the doubt. When they said they were going to use pay-go 
rules--this motherhood term--to discipline spending around here, people 
gave them the benefit of the doubt. When they said they weren't going 
to raise the national debt any more than the President was, people gave 
them the benefit of the doubt. When they said they weren't going to 
raise taxes on the American people, that they were going to find 
revenues by simply collecting taxes that were already owed, people gave 
them the benefit of the doubt.
  Well, the shell game is over. The benefit of the doubt no longer 
applies. The record is in and the record is pretty dismal.
  The budget from last year produced by the Democratic Congress 
increased taxes over a 5-year period by $736 billion. It dramatically 
increased spending. In the discretionary accounts, the Democratic 
budget last year, as it was finally executed, increased spending over 
what the President requested. The President requested a $60 billion 
increase in discretionary spending. It increased spending or proposed 
to increase spending when you combine the supplemental proposals and 
the actual budgeting proposals by over $40 billion. It added $2.5 
trillion--trillion--to the Federal debt over the 5-year period. This 
term ``pay-go'' is the most abused term on the floor of the Senate and 
on the floor of the House in the area of fiscal discipline: ``Oh, we 
are going to use pay-go to discipline Federal spending.'' We hear that 
from every Democratic candidate starting with their Presidential 
candidates right down to their House Members.
  Last year on 15 different occasions they either directly waived pay-
go or they gamed it in the most cynical manner by changing dates, 
changing years, moving money here, moving money there, to the tune of 
$143 billion of new spending, which should have been subject to pay-go, 
which was not. It was simply added to the deficit and to the debt of 
our children, that our children will have to pay. They didn't do one 
thing about addressing the most significant fiscal issue we face as a 
country, which is the pending meltdown of our Nation's fiscal policy 
because of the $66 trillion of unfunded liability we have on the books 
as a result of obligations and commitments we have made to the baby 
boom generation which is beginning to retire right now--$66 trillion. 
The President at least sent up a package which proposed trying to 
discipline the rate of growth of entitlement spending--specifically 
Medicare--in very reasonable ways, by asking people such as Warren 
Buffett, for example, to pay a fair cost of their drug benefit--people 
over 65 who have a lot of money should pay some cost of their drug 
benefit; by using technology more aggressively, by limiting the number 
of lawsuits that are brought against doctors to something reasonable 
along what is known as the California or Texas models. The President's 
proposals would have limited this liability here as it related to 
health care by $8 trillion. It would have reduced it. They were 
reasonable proposals.
  But the Democratic budget, as passed and as executed, not only didn't 
limit or reduce in any way this outyear liability, they actually 
aggravated it. They aggravated it dramatically, by $466 billion over a 
5-year period. It was totally irresponsible.

[[Page S1493]]

  On the tax side, this tax increase is real dollars--real dollars that 
Americans are going to have to pay. For 43 million Americans, under the 
Democratic budget as was passed last year, their taxes will go up by 
$2,300 a year--$2,300 a year beginning in 2011. For 18 million seniors, 
their taxes will go up by $2,200 a year--that is a lot of money for 
somebody--beginning in 2011. For low-income Americans, 7.8 million 
Americans who do not pay taxes today because the 10-percent bracket is 
in place, their taxes will go up. They will have to start paying taxes. 
For small businesspeople, 27 million small businesses that file what is 
known as a subchapter S, which means they basically are taxed as 
individuals, their taxes will go up on average $4,100. Those are real 
dollars people are going to have to pay in new taxes as a result of the 
Democratic budget.
  Let's put it in another context. The Democratic budget, the nightmare 
budget, the shell budget, added $2.5 trillion to the debt: $736 billion 
in new taxes, $466 billion in new deficit spending in the area of 
mandatory increases, $205 billion over 5 years in discretionary 
increases over what the President suggested--huge increases, totally 
irresponsible.
  Equally important, as I mentioned, here is the tax increase, 
discretionary increase, the debt increase under the Democratic budget 
and absolutely no mandatory savings, which is the biggest issue of 
concern for us as a nation as we look into the outyears from the 
standpoint of being able to pass on to our children affordable 
Government. If you give to your children the debts of today, this $2.5 
trillion they added, and you put on top of that $66 trillion of debt as 
a result of Medicare and Medicaid and Social Security costs that we 
haven't figured out how we are going to pay for, you are essentially 
going to say to our children: I am sorry, you can't have as good a life 
as we have had as a generation. You are not going to be able to send 
your kids to college. You are not going to be able to buy your first 
house. You are not going to be able to live the quality of life 
Americans have been experiencing throughout the generation of the baby 
boom generation because we are going to put on you so much debt, so 
many costs, we are simply going to overwhelm you.
  What did the Democratic budget do to address that? Nothing. A lot of 
lip service. In one of the most obscene--obscene is the only accurate 
term--actions of budgetary gimmickry, the Democratic budget claimed 
they were going to raise $300 billion in tax revenues from people who 
owe taxes but weren't paying them. This is how they are going to pay 
for all their new programs. They are going to raise $300 billion 
collected from people who owe taxes. Well, yes, those are the 
estimates. There is a huge amount of money out there that isn't being 
collected today and should be collected. But how much was collected 
under the Democratic budget of that owed and unpaid balance? Zero. Why 
was that? Why did they only get zero? Because they actually cut the 
dollars going to the Internal Revenue Service for enforcement. So not 
only could the Internal Revenue Service not collect the additional 
money--and they could never have gotten $30 billion anyway--the highest 
estimate the Internal Revenue Service gave us was something in the 
range of 20 billion to 30 billion was their best number. They plugged 
this number in that the Democrats said they were going to get, which is 
$300 billion, and why did they plug it in? Because they wanted to spend 
it. They wanted to spend $300 billion.
  It is pretty interesting because, if you go back here, you will 
notice discretionary spending went up $205 billion, right here, and 
they claimed they were going to pay for that and have a little surplus 
with this empty number which they never got of $300 billion. Where did 
the $205 billion actually get paid for? How did it get paid for? It got 
paid for by putting debt--debt--on our children's shoulders.
  Then, on top of that, of course, they are going to raise taxes by 
$336 billion, as I mentioned. For 34 million Americans, it means a 
$2,300 tax increase.
  As if this isn't bad enough, their track record now is such a glaring 
example of fraud and misdeeds and misrepresentation of a shell game, of 
claiming one thing and doing the opposite in the area of tax policy and 
raising taxes when they said they would not, raising spending when they 
said they would not, not addressing entitlements when they said they 
would. As if that isn't bad enough, we now have the Presidential 
candidates out there campaigning. On top of the track record of total 
gross fiscal mismanagement, we have Presidential candidates on their 
side of the aisle making proposals to increase spending which dwarf 
what is already here, a dramatic rise in spending.
  Senator Obama, for example, has proposed 158 new programs that we 
know of, that we can score--158--totaling annual increases in 
spending--annual--of $300 billion a year plus. Senator Obama and 
Senator Clinton say: Well, we are going to pay for this by taxing the 
rich; we will just tax the rich, tax the rich, tax the rich, tax the 
rich.
  Let's look at the numbers. If we take the top rates in America, which 
are the rates the rich pay, back to the days of Bill Clinton, you take 
them from 35 percent--they pay 35 percent of their income to taxes 
now--take it back up to approximately 40 percent, 39.6 percent which 
is, I presume, what they are referring to--and, in fact, that is what 
they are specifically referring to--they say they are going back to the 
Clinton tax rates for the rich. You raise $25 billion in income taxes.
  Senator Obama has already proposed spending $300 billion plus a year. 
So he is short $280 billion. From where is that going to come? That is 
going to come from raising taxes on all the other Americans who work 
and pay income taxes. He is talking about basically repealing all the 
Bush initiatives and, believe me, even if he does that, he cannot raise 
enough money to pay for what he is proposing. So he is talking about 
adding dramatically to the debt. It is a spend-arama, an Obama spend-
arama, which is going to cause us huge problems with taxes.
  So as we go into this next budget, there is no longer the benefit of 
the doubt out there for our colleagues on the other side of the aisle. 
They now have a track record of a budget that raised taxes $736 
billion, a track record of a budget that increased discretionary 
spending by $205 billion, a track record of a budget that increased the 
debt by $2.5 trillion, a track record where they game their own pay-go 
rules--game them--so they spend $143 billion, which they should have 
had to offset, without any offsets, and a track record of not 
addressing the most significant issue we have today, which is how do we 
pay for the future costs of the retirement of the baby boom generation 
and not put that burden on our children.
  I suspect the budget they are going to bring forward next week is 
going to look a lot like the one they passed last year. But when they 
claim this year they are going to get another $300 billion from some 
wizard behind the screen by collecting taxes that are owed but are not 
collected, I hope the press and the American people will say: But hold 
it. You already claimed that once. Are you going to do it again?
  When they claim they are going to discipline spending around here by 
using pay-go, I hope people will say: Hold it. Last year you said you 
were going to do that, and you spent $143 billion subject to pay-go.
  When they claim they are not going to raise taxes, somebody has to 
say: Hold it. The only way you can pay for your program is to repeal 
the tax laws as they presently exist and make the taxes go up 
dramatically on all Americans, not just on wealthy Americans.
  And when they claim they are not going to increase discretionary 
spending, somebody needs to ask: Hold it. Last year you increased 
discretionary spending by $205 billion over what the President wanted 
in nondefense discretionary.
  They have no credibility any longer. So I hope the American people 
and the press, and certainly I hope the Senate, will ask some serious 
questions of them as they bring forward their budget.
  Mr. President, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Texas.
  Mr. CORNYN. Mr. President, I congratulate the Senator from New 
Hampshire for his leadership as the ranking member of the Senate Budget 
Committee and somebody whom I think understands the complexities of the 
Federal budget better than just about anybody. I do not claim to have 
that same

[[Page S1494]]

level of understanding, but what I do think I understand is what works 
and what does not work.
  I will cite as an example a story in today's Wall Street Journal 
comparing my State, Texas, to another State that I will not name for 
present purposes, and wondering why the economy is booming, why jobs 
are being created in Texas when jobs are leaving the other unnamed 
State. They cited three main reasons. One is the belief in the benefits 
of free trade and selling our goods and services overseas in a 
reciprocal free-trade arrangement. They cite lower taxes which provide 
more incentive for productivity. And they cite the fact that in Texas, 
you have a right to work without having to belong to a labor union. You 
can if you want to, but you don't have to in order to work. And I add 
to those three items, sensible tort reform, which has not only created 
a business environment in our State which says to employers: You are 
not prey for predatory activity on the part of the trial bar, but you 
are welcome in our State to create jobs. Yes, you are going to be held 
accountable, but we are not going to create a hostile litigation 
lottery which is going to chase jobs and employers out of our State.
  A lot of those basic principles which have helped make my State, the 
State of Texas, such a welcoming State for economic growth and 
prosperity and creating jobs and opportunity apply to the Federal 
budget, too, about which I wish to talk.

  Senator Gregg had this chart up which talks about last year's budget; 
frankly, things that were done last year that I hope we would have 
learned our lesson this year and will not repeat. For example, last 
year's budget anticipated a tax increase on the American people of $736 
billion. One might ask: From where is that money going to come? Is 
Congress actually going to vote for a tax increase? We may recall that 
the tax relief that we passed in 2001 and 2003 was not permanent 
because we could not get sufficient votes to make it permanent, so it 
was temporary. A significant portion of that tax relief--the capital 
gains and the dividends reduction--will expire during this budget 
period. It will result, if it does expire, without Congress acting, in 
effectively the largest tax increase in American history--but here is 
the worst part--without a vote of Congress. In other words, by 
Congress's inaction, we will see the largest tax increase in American 
history, and that is part of the revenue that this budget that was 
passed last year anticipates.
  That contradicts the lesson I mentioned a moment ago that we have 
experienced in my State. We don't have a State income tax. We have 
tried to keep taxes as low as possible. It just makes common sense. You 
don't have to have a Ph.D. in economics to understand that if you want 
more of something, then you reduce the burden of producing it through 
lower taxes, through less regulation, and less litigation. If you want 
less of something, then you increase taxes, you increase regulation, 
you increase litigation. To me, that is the lesson we have learned, not 
only in my State, as I mentioned, but also in the Congress as a result 
of the tax relief we did pass in 2001 and 2003. We have seen more than 
50 straight months of economic growth with more than 9 million new jobs 
created in the United States since 2003. Was that an accident? Was it 
serendipity? No, it was a result of reducing the burden of producing 
income and allowing taxpayers to keep more of what they earn, and it 
resulted, coincidentally, in some of the highest levels of revenue to 
the Federal Treasury because more people were working. They were 
incentivized to work harder and, as a consequence, they ended up paying 
more taxes which generated more revenue to the Federal Treasury, 
bringing the deficit down over what had originally been projected.
  Of course, keeping taxes low is part of the equation. The other part 
of the equation is spending. As Senator Gregg pointed out, this budget 
passed last year dramatically increased Federal spending. This is one 
of the hardest things Members of the Congress have to do because, of 
course, we have people coming to see us every day saying: Senator, I 
would like your help funding this transportation project or providing 
an appropriation to pay for this or for that. But the fact is, we need 
to be good stewards of the taxpayers' money, and we need to learn how 
to say no because it is in the best interest of our economy and, in the 
long run, it is in the best interest of the American people because 
when we increase spending, we grow the size of the Federal Government. 
As Government expands, individual liberty contracts.
  In other words, the bigger Government is, the less freedom we have to 
do what we want, as long as it is lawful. And what that means in the 
economic sphere is we are going to generate more economic activity, 
more revenue, create more jobs and more opportunity in the process.
  So greater spending, dramatically increasing spending, is exactly the 
wrong thing. We ought to cut spending, eliminate wasteful programs, 
particularly those--and I have spoken on this issue before. The Office 
of Management and Budget has a Web site called expectmore.gov. You can 
go there and see a thousand different Federal programs that have been 
surveyed by the Office of Management and Budget, 22 percent of which 
either there is no evidence that they are meeting their intended 
purpose or effective, in other words, or the Office of Management and 
Budget simply cannot tell. Those are exactly the kinds of programs, the 
kind of waste that ought to be eliminated to reduce spending so that we 
can spend where it is absolutely necessary on our national priorities. 
But eliminate that wasteful spending. This budget does not do that.
  Then, I think the most, frankly, shameful part of this budget is its 
failure to step up and recognize our responsibility to our children and 
our grandchildren who are depending on us to make sure they are not 
left with a debt they have to pay but, rather, they are left with, 
hopefully, a better life and better opportunity than we as their 
parents and our grandparents had. I know that is what my parents wanted 
for me and my brother and my sister. They wanted at least as good a 
life as they had, hopefully better. That is what every parent and every 
grandparent wants for their children and their grandchildren.
  What has this Congress done to make sure that can happen? Frankly, 
not much. Let me put it this way: not enough because what we see is a 
growing debt. This budget passed last year grew the debt by $2.5 
trillion. I know it is hard to think in terms of trillions. I doubt 
there is a human mind that can really conceive of how big that is. I 
mentioned yesterday that a billion seconds ago it was 1976. We are 
talking about not billions but trillions--a huge amount of money.
  This budget grew the debt by $2.5 trillion but, frankly, what this 
proposed budget we are going to take up next week will in all 
likelihood fail to address is 66--6-6--$66 trillion in unfunded 
liabilities of the Federal Government.
  One might ask: We understand the budget deficit, but what is the 
debt? The deficit is the amount of money we overspend each year, but 
the debt is how much we owe to our children and grandchildren, the debt 
we are simply passing down to them by failing to fix the Medicare 
Program, failing to ensure that the Social Security Program is on a 
solid fiscal financial basis. The fact is, there is legislation that I 
hope will be offered during the course of this budget debate that a 
task force be created.
  As a matter of fact, the distinguished Democratic chairman of the 
Budget Committee and Senator Gregg, as ranking member, have proposed a 
task force so we can finally roll up our sleeves and come to grips with 
this growing financial crisis and the debt we are simply passing on to 
our children and grandchildren.
  I mentioned that $1 trillion is impossible, perhaps, for us to 
comprehend, but let me bring it down to a number that we all can 
understand; and that is $66 trillion in unfunded liabilities due to the 
Congress's failure to deal with this growing cost of entitlements--
Medicare, Medicaid, and Social Security. If you divide that by every 
man, woman, and child in the United States of America, it comes down to 
about $175,000. So $66 trillion in unfunded liabilities, for 
entitlements primarily, boils down to $175,000 for every man, woman, 
and child, including the baby who was born last night. That baby was 
born into the United States--the most prosperous, the freest Nation in 
the

[[Page S1495]]

world--burdened by $175,000 of debt because that baby's adult parents 
and the people they elect to Congress have failed to take 
responsibility to make sure that baby would be born into a world of 
prosperity, opportunity, and freedom. Instead, the baby has been born 
into a world that has that freedom and opportunity but also is burdened 
by $175,000 in debt.
  There are a lot of challenges that lie ahead, and I have other charts 
I won't bother the Members of the Senate with here today, but we have 
to have an important debate here as we write the Federal budget. I 
agree with the Senator from New Hampshire, this is not the President's 
budget. As a matter of fact, everybody knows what happens to a 
President's budget, whether it is a Democrat or Republican in the White 
House. It is basically ``dead on arrival'' at Congress. I could say it 
another way. The President proposes and Congress disposes the budget. 
But it is our responsibility to write that budget, and we should do so 
in a way that is fiscally responsible.
  We should also do it in a way that addresses the real pinch that 
average Americans feel when they fill up their gas tank and find that 
gasoline is $3.25, $3.50 a gallon, on its way to $4 a gallon probably 
this spring; and when they find that their health care costs continue 
to go up year after year after year such that they have less and less 
disposable income. Those are the sorts of things we ought to be paying 
attention to--reducing taxes, eliminating the debt, taking 
responsibility for that, and taking care of those bread-and-butter 
issues that the American people care about, because those are the ones 
that impact their quality of life on a day-to-day basis.
  Mr. President, I yield the floor.

                          ____________________