[Congressional Record Volume 157, Number 53 (Tuesday, April 12, 2011)]
[House]
[Pages H2593-H2599]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
FISCAL CHOICES
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 5, 2011, the gentleman from Kentucky (Mr. Yarmuth) is
recognized for 60 minutes as the designee of the minority leader.
Mr. YARMUTH. Mr. Speaker, it is a great honor to be here on the floor
of the House of Representatives talking to the American people about
one of the most critical things that this body does, and that is to
decide how much money we ask our citizens to contribute to the
government and how that money is going to be spent.
I didn't come here intending to respond to the gentleman who spoke
before me, but he cast in one respect the whole debate over our budget
very well when we had Mr. Broun's four-way test. The first thing that
Mr. Broun listed was: Is it right/moral? And I agree with him because
when we debate the budget of the United States, when we debate how we
are going to spend the taxpayers' money, the first question we should
ask is: Is it right, and is it moral? The converse is if we don't spend
something, is it wrong and is it immoral.
Today, I had the great honor of visiting Walter Reed Hospital. I got
to speak with several of our extremely brave, courageous soldiers who
have been injured in battle. And one young man who lost both legs, one
just above the knee and one all of the way to his pelvis, and lost a
little bit of finger on one hand was on what can only be described as
bionic legs which he said are extremely good, the technology is
extremely advanced; but they still don't help him walk. He talked to us
for a long time about what he had been through, the progress he had
made, and what he hoped to achieve with technology.
{time} 2010
His parting comment to us was that this is the result of the Federal
Government spending money on medical research. This is helping people
not just in the military, not just in the Armed Forces, but also in the
private arena as well.
So I look at what the Republican budget has done, which we will
consider later in the week; and it slashes money for medical research.
I say let's apply Mr. Broun's four-way test: Is it right? Is it moral?
Also, does it make any sense to cut medical research when we have brave
men and women who after making incredible sacrifices are reacquiring
some of their lives because of the taxpayer money we have spent in
funding critical research? It would be immoral--Don was his name--to
deny Don his request that we continue to fund medical research that is
going to help him regain his capabilities, his physical function, as
well as to continue to fund the medical research that will help the
thousands of young men and women who have sacrificed so much for us.
So as we enter this debate this week on the Republican budget
proposal/the Democratic alternative budget proposal, we have choices to
make. That's always what government is about. It's about choosing: How
do we spend the taxpayer money that we ask our taxpayers to contribute
to the general welfare of this country?
Last week, we sat in the Budget Committee and considered the
Republican budget. I'm sure that my characterization of the Republican
budget will be different than the Republicans' characterization of
their budget. Yet I will say one thing, that we all agree that we have
a fiscal challenge in front of us. We have enormous deficits. We can
argue about how we got here, but I'm not going to spend time debating
that tonight. We clearly have a challenge, and the future is even more
challenging. So the question is:
As we approach this budget deficit, this future of deficits, a very,
very large national debt, what is the best way to approach it?
Now, the Republican answer is that there is only one side of the
ledger. Most homes, most businesses have two sides of the ledger. They
have an income side, and they have an expenditure side. As far as the
Republicans on the Budget Committee are concerned, we only have an
expenditure side. You've heard the Speaker of the House say we only
have a spending problem; we don't have a revenue problem. You've heard
my senior Senator from Kentucky, the minority leader of the Senate, say
we don't have a taxing problem, a revenue problem; we have a spending
problem.
In fact, if you look at our situation right now, we're no different,
in a lot of respects, from the average household or the average
business. If we have a financial challenge, we do a couple of things.
We ask, Okay, where can we cut costs? Then we ask, How can we generate
more revenue? Those are the two options. As far as the Republicans are
concerned, there is only one option. It is to cut expenditures.
Unfortunately, my characterization is that they cut
[[Page H2594]]
the programs which help the most vulnerable people in our country.
On the other hand, what do they do on the revenue side? They say,
Well, let's see. Millionaires and billionaires haven't done quite well
enough over the last decade or so. Twenty years ago, they only earned 9
percent of all income in the country. Now they earn 35 percent of all
income in the country. That's not quite good enough. Let's give them
another tax break. The Bush tax cuts were okay, but they weren't quite
large enough. So instead of cutting their rate from 39.6 to 35 percent,
let's cut their maximum rate to 25 percent, and let's see what that
does for the economy.
I think most of my Democratic colleagues would agree that, if we're
going to approach this deficit and the national debt in a responsible
way, we'll look at both sides of the ledger. We will ask people who
have done extremely well and who have the capacity to give more to pay
a little more, and we will make responsible cuts that are balanced
across the sector.
There are so many ramifications to this debate, and we're going to be
debating it all week, so I am proud to have with me today some members
of the Budget Committee from the Democratic side to help me discuss
this.
It is my great honor now to yield to the gentleman from New York (Mr.
Tonko).
Mr. TONKO. Thank you, Representative Yarmuth, and thank you for
leading us in this discussion.
It is rather interesting to hear you, with your introductory
comments, speak of the approach to one side of the ledger. What has
been advertised out there, what has been messaged, is that what we have
are these cuts that translate into savings: we're going to save at the
expense of the middle class. We're going to cut programs for seniors,
for veterans, for children, for working families, for small businesses.
That will produce savings--this propensity for tens of billions
of dollars' worth of cuts, for $100 billion worth of cuts, and an
insatiable thirst for cutting domestic programs that really provide the
dignity factor for many families as well as provide for job creation
and retention.
We saw what happened when we invested in job creation, which was to
gain over 2 million private sector jobs in just over the last year. So
we know that those investments oftentimes will lead to lucrative
dividends. They will relate to programs that are required for our
working families, for our middle class Americans across this great
country. Also, they provide for an opportunity for job creation, which
produces the sort of mix--that down payment, the priming of the pump,
if you will--that makes it all happen.
So, Representative Yarmuth, you are correct in talking about this as
a one-sided approach. Yet what troubles me is that there is this
messaging effort under way that would try and convince the American
public that it's producing savings. But where do those savings go?
There are trillions of dollars of cuts to the middle class in this
Republican plan. Those trillions of dollars of cuts that they deem as
savings are then that fuel that provides the resources to cut the
trillions of dollars' worth of millionaire/billionaire tax cuts to
provide for the continuation of services that contractors will provide,
which have been deemed wasteful or at times fraudulent, with the
Pentagon. They will continue to protect those investments. They will
allow for additional relief for corporations.
So it's sliding dollars out of the pockets of the middle class and
investing them, the spending that they do, as they accrue those
savings. The new spending that they do is tax cut delivery for those in
the upper echelon. To me, it sounds very much like the pre-recession
situation under the Bush administration which led us to this deep and
very painful and long-term recession. Their plan has been dubbed by
themselves, by their own Members, as the Path to Prosperity. I would
suggest that it's a road to ruin for the middle class and that it's a
road to riches that paves the streets with golden opportunities for
those who are the most comfortable in society, for those deemed on top
of the perch.
This is a very interesting scenario that is being placed before this
body, before all of Congress for that matter. We need to put it under
the microscope, and we need to message to America what is happening.
You take from the poor and the middle class. You slide it over to the
most comfortable--to corporations and millionaires, billionaires, oil
company handouts, mindless handouts. That's how they pay for those, by
sliding that cash down that slippery slope and investing it in tax
cuts, spending it on tax cuts for those, as you indicated, who just
didn't get quite enough under the Bush tax cuts.
In a while, too, I want to go toward the Medicare situation. They
want to end Medicare with this budget. I want to talk about that after
we hear from some of our other colleagues.
This is an interesting scenario--a road to ruin, a road to riches.
It's a complete separation, a dichotomy, of special needs out there,
coming at the expense of middle class America. It's a raid on our
middle class. It's paving the road to riches for the very fortunate,
and it's creating the road to ruin for America's middle class.
{time} 2020
Without a strong middle class, without enhancing the purchasing power
of our middle class, we have a weakened America. That is easy enough to
prove through history.
So thank you again, Representative Yarmuth, for bringing us together
on a very important discussion here in the House of Representatives as
we continue to fight for the middle class that has been impacted
severely and would take even more hits if this budget were allowed to
pass through.
Mr. YARMUTH. I thank the gentleman. He mentioned the ``road to
ruin.'' It's also a road we've been down before.
Mr. TONKO. Absolutely.
Mr. YARMUTH. It is a road we've been down before.
Back under the Reagan administration, this whole magical economic
theory of trickle-down economics was developed. And the idea was, you
let people at the top make as much as they possibly can, do as well as
they possibly can, and that will trickle down and help everybody else.
The man who was largely responsible for that policy under the Reagan
administration, David Stockman, who was his budget director, he said
just last year, ``I find it unconscionable that the Republican
leadership, faced with a $1.5 trillion deficit, could possibly believe
that good public policy is to maintain tax cuts for the top 2
percent.'' That was last year when we were actually debating whether to
return to the Clinton-era tax rates--the Clinton era, by the way, which
resulted in one of the most impressive decades of job growth in this
country.
Now they even want to double down on that. They not only don't want
to go back to the Clinton era tax cuts; they want to cut it even
further. And their theory is that by cutting the tax rate by 10 percent
more on the wealthiest people in this country, that they will create
more jobs. Where do they get this stuff? Well, the only source they
have for that theory is the Heritage Foundation. Now the Heritage
Foundation was also the group that said that if we cut taxes under the
Bush administration, that we're going to have this enormous job growth
and this enormous surplus. It didn't quite work out so well. But
they're saying now--this is what I call the ``Harry Potter budget.''
You wave your magic wand and you make anything sound like it's true--
cut taxes further on the rich, slash spending to help the low- and
moderate-income people in this country, and the economy will bloom.
Well, I'm not buying it. I don't think most Americans will buy it. But
again, it's a road we've been down before, so we have some evidence.
At this point, I'd like to introduce and yield time to a great new
Member of Congress and also the Budget Committee, the gentlelady from
California (Ms. Bass).
Ms. BASS of California. Thank you very much, Mr. Yarmuth, for your
leadership in this effort.
You know, as a new member on the Budget Committee, we had an
interesting week last week. We really just completed a week where we
saw the far right of the Republican Party take their party off the
ledge and way out of the mainstream. They've declared war on seniors,
on the disabled, on the sick, on children, and on the underserved by
[[Page H2595]]
proposing to end Medicare and Medicaid as we know it. They've
championed the budget, entitled the Path to Prosperity.
This is a plan that simultaneously ends Medicare while giving
billions in tax breaks to Big Oil and the wealthiest Americans. Mr.
Tonko called it the ``path to ruin''; I thought about the ``Ryan-to-
ruin'' plan.
It generously gives senior citizens a gift, and that gift is a
voucher to purchase health care. The senior citizen then has to
identify an insurance carrier that will take the voucher; and if the
person is lucky, the voucher will cover all the cost. I do think that
this would be rare. And I don't know what happens in this plan if after
a couple of years or a couple of illnesses the insurance company
decides to drop the person or raise the rates. You know, under the
Affordable Care Act, of course, they couldn't do that, but if the Ryan
plan does what he wants, he wants to repeal the Affordable Care Act, so
all of that would come back into play. The person would have to pick up
the rest of the cost under the Ryan plan.
Now, I believe that we are simply foolish and we are fooling
ourselves if we think all seniors will be able to just write a check
and pay the difference. That's what is said, they will just pay the
difference, they will just have to absorb more cost. A more likely
scenario is that seniors will simply not have medical coverage, and we
will be sent back in time to when seniors did not have coverage because
insurance companies didn't want to cover them. I often say to people
that you can judge a society by how it treats its elderly and its
children. The ``path-to-ruin'' plan hurts both populations.
What I wanted to do today was to share a story, but just talk for a
moment a little bit about the Ryan plan. When it takes effect in 2022--
that's only 11 years from now--the average senior would receive an
$8,000 voucher to buy insurance. What I wanted to share with you was
the years that I spent working in the emergency room. I worked in Los
Angeles County, USC--one of the largest emergency rooms in the United
States. And the emergency room is so large, it is divided into
different sections. One section that I spent a couple of years working
in is called ambulatory care, but we used to call it the ``walking
wounded'' because, frankly, the people that came to that section of the
emergency room shouldn't have even been in an emergency room, but the
reason why they were there was because they didn't have health
insurance, they didn't have access to care. And what typically happens
is that if you don't have access to care, by the time you eventually
see someone, you are much sicker than you would have been.
So I remember a case where a diabetic patient, who was not 65 and,
therefore, he couldn't access Medicare, he came into the walking
wounded area or the ambulatory care area with a sore on the heel of his
foot. He told me in the history that he was a diabetic. But he had
tried a series of home remedies and he finally came to the ER when his
heel started turning purple. Well, as I interviewed the patient and I
asked about his medical history, he told me that he had been diagnosed
with diabetes years ago, but he couldn't afford his medication. So he
was trying to watch his diet and do the best he could. Well, for those
of you who don't know, a patient with a history of poorly controlled
diabetes who presents to an emergency room is likely to have a series
of complications. Well, this man ended up as an amputee because the
sore on his heel--that he didn't realize--had developed into gangrene,
and that's why his foot was turning colors.
So just thinking about the cost of this, the total cost of this visit
was $12,000 and his leg. That bill included a $2,000 charge for his
emergency room visit and lab tests, a $6,000 charge for an amputation,
and a daily charge of $1,400 for aftercare. If this patient had had
access to routine preventive care, he would still have his leg, and
$12,000 would be saved.
So why do I share this story with you? Well, we're fooling ourselves
if we don't understand that turning Medicare into a voucher and leaving
seniors to fend for themselves is simply denying adequate health care
that in the end will cost us so much more in suffering and in hospital
costs that will ultimately be borne by taxpayers.
Today in my office I met with representatives from several hospitals
who were describing the challenges that they face now. So there is an
area of Los Angeles County where 600,000 people live--and the last time
I checked that was around the entire population of the State of
Vermont, 600,000 people--where there is not one trauma center, there is
not one emergency room because all of the four hospitals in that area
have closed. Now that's today.
Under the Ryan plan, vouchers for seniors and vouchers for States--
because that's the bottom line as to what a block grant is, it's a
voucher; instead of a voucher for an individual, it's a voucher for a
State. The hospitals they represent that all border this area--that has
no trauma center in it and has no emergency room and has no hospital
because they're all closed up--they would essentially have to absorb--
and they have been absorbing--the population, these 600,000 people. So
they were concerned, and they came into my office today concerned that
they could potentially face closure now, given the situation.
If we were to adopt the Ryan plan--the ``pathway to ruin,'' however
you want to describe it--I think we would be setting the stage for
hospital closures to continue, for more patients to come into the
walking wounded area of emergency rooms, for there to be more
amputations, for people to be sicker and eventually come to the
emergency room--which is so incredibly short-sighted because in the end
it winds up costing taxpayers so much more money because these people
are going to be cared for. So we are fooling ourselves if we think that
seniors are just going to be able to meet what the voucher doesn't
cover.
Thank you very much for your leadership in this.
Mr. YARMUTH. I thank the gentlelady for her contribution and for her
work on the Budget Committee.
I know somewhere toward the end there the gentlelady mentioned jobs,
and this is something that is kind of at the core of what we're trying
to work toward.
{time} 2030
We're trying to find a budget, develop a budget that will stimulate
the economy, that will create jobs. And we know that under the Ryan
budget, again, according to the Heritage Foundation, the way they get
to some kind of fiscal sanity is they project that unemployment in the
country will be reduced to 2.8 percent by 2016.
Now, I don't know any reputable economist in the country that thinks
that's feasible, particularly when you're slashing a lot of government
spending that does create jobs, particularly in the health care arena;
but no one has been more vocal and more knowledgeable and more
articulate about what it takes in this country to create jobs than Mr.
Garamendi from California.
I welcome him to the discussion and yield to him now.
Mr. GARAMENDI. Thank you very much, Mr. Yarmuth.
For the members of the Budget Committee, you've had a steep and
difficult job as the Republicans have attempted simply to ram down the
throats of this Congress a really unacceptable budget, one that does
destroy opportunities.
I would love to talk about Make It in America, and I will in a
moment, but I was just listening to my colleague from California, and
she raised the issue of the medical care here in the United States.
It was 1964 that the United States set out on a very, very important
mission, and that was to provide health care to seniors. Prior to that
time, and I know from my own county where I grew up in Calaveras
County, if you became a senior, you were destined for a very, very
rough road. There was literally no insurance available for you, and
there was no opportunity for you to get yourself out of poverty unless
you happened to be among the wealthy. It was a terrible situation.
So during the Lyndon Johnson period in 1964, they created a program
called Medicare so that when you became 65, you had an opportunity to
get a solid health care program available to you--a doctor program, a
hospital program. You had to pay a little bit for the hospital program,
but it was guaranteed
[[Page H2596]]
available to you. And every American 65 and over had that policy.
Here we are, 40-some years later, and what's taking place? Our
Republican colleagues are determined to terminate, kill, stop,
eliminate Medicare. They do it in a subtle way.
But I want everyone to know that this year if the Republican budget
goes forward, this will be the tombstone for Medicare: ``Medicare:
1965-2011. Created by Lyndon Baines Johnson, LBJ. Destroyed by the
GOP.''
How do they do it? They do it by saying everyone that is 55 years old
today will never get Medicare. It's over. And for those that are on
Medicare, their lives will move on and eventually they'll be gone also.
And Medicare dies with this budget. This is a central part of the
American promise to every senior, and the Republicans are determined to
terminate Medicare and put a tombstone dated this year, 2011.
You'll get a voucher; but as my colleague from Los Angeles so
eloquently said, that voucher will be worth very little when the time
comes. And you'll be thrown to the insurance sharks.
I understand insurance. I was the insurance commissioner in
California for 8 years, and I know what the health insurance companies
want to do. They want to make sure that they insure somebody who will
never get sick. Preexisting conditions, raise the rates, change the
benefits, increase the co-pays, end the deductibles, all of that. So
the future population of seniors in just 10 years will be thrown to the
wolves, and they'll be at the mercy of the health insurance companies.
We cannot let that happen. This is a fight for the very nature of
America. This is a fight not only to protect seniors but to protect
those who want to become seniors. I want to know what American out
there today does not want to live long enough to get to Medicare.
They know that today because of the Democratic Congress they have an
opportunity to get insurance with the Health Care Reform Act, but they
know that the Republicans want to take that away, too. The very first
piece of legislation that the new Republican Congress passed was the
repeal of the Affordable Health Care Act. This is step two, to
dismantle.
Now, I'm going to take another 30 seconds and then turn it back to my
colleagues on the budget side.
But here's what we must do. We must get to the root cause of the
underlying inflation in health care.
Terminating Medicare does not stop health care inflation. What could
stop it are the kinds of reports and the kinds of suggestions that I
made 5 years ago when I wrote this document called ``Priced Out.''
Forty-three separate things that we can do--specifically for
California, but it's applicable for America--43 separate things that we
can do to bring down the costs of medical care.
It turns out that about a dozen of those were in the Affordable
Health Care Act, very specific things to rein in the cost of medical
care.
Two examples. One: hospital infections. Not only deadly, but costly.
Now every hospital in the United States is forced by the Affordable
Health Care Act to pay attention to hospital infections. It's probable
that one of our colleagues who was with us here in this House last year
died as a result of a hospital infection just last week. This is
serious stuff. It's in the Affordable Health Care Act. Hospitals would
be penalized.
Secondly, electronic medical records so that the mistakes are
eliminated.
Let me turn this back to you, Mr. Yarmuth and Mr. Tonko. You on the
Budget Committee have served so well, so hard, fighting the initial
battle to protect America's seniors and to protect this Nation's
future. Thank you for the opportunity to join you.
Mr. YARMUTH. I thank the gentleman for his contribution and also want
to segue from what he said because he talked about Medicare and the
ability to save money in Medicare. One of the ironic things about this
debate has been that last year when we were passing the Affordable Care
Act and found $550 billion over 10 years that we could save in Medicare
and reinvest in new benefits, during the campaign that year, we were
chastised for slashing Medicare. Yet those same Republicans, in
developing their budget and saying how great they are at cost-cutting,
are using the same savings that we found, the same savings of $550
billion, that they ran millions and millions of dollars against
Democratic candidates last year. And they're taking credit for that in
their budget, which is interesting.
I know Mr. Tonko is chomping at the bit to talk about Medicare some
more, so I'll yield to him at this point.
Mr. TONKO. Thank you, Representative Yarmuth and Representative
Garamendi. Thank you both for your input.
Now, Representative Bass of California talked about the Medicare
transformation that would really hurt people across this great country,
and it seems as though you would expect everyone that serves here to be
an avid fan of history, that we would want to be taught by the history
that has built this great Nation.
We heard earlier from Representative Yarmuth about the repeats of the
tax cuts that were recent history. We saw it during the second Bush
Presidency. We saw it during the Reagan era where we did this trickle-
down theory: if we reduce the burden at the top, it will trickle down
and everyone will have jobs galore.
Well, you look at the history, and those two scenarios just did not
work. They did not work. And as students of history, all of us as
Representatives, we should absorb that lesson, and we should know that
a repeat of that kind is only going to wreak damage on the American
economy and, more importantly, on the American families, the middle
class.
What did work, what lesson in history stands very strong and tall is
that during the FDR Presidency when this country was hurting from one
of the worst economic struggles it had to face, they came up with a
program that invested in job creation, invested in the American worker,
invested in American families.
We created infrastructure; we built across America the needs of this
great Nation. And today, some of those institutional efforts are still
serving our needs. They stand as a monument of government responding in
a way that embraced compassion, that came forward with an intelligence
that enabled us to grow out of those economically difficult times. And
we were benefited by that sort of leadership.
{time} 2040
What we need today is an investment in job creation. Think of it. As
we enter into a global race on clean energy and innovation, other
nations are bulking up and we are defunding with this budget. We are
defunding R&D, research and development for science and tech jobs. How
can we expect to win a race, a global race, when we're tying our hands
behind our backs and are not allowing us to go forward?
But to Medicare, the history learned there, and Representative
Garamendi pointed it out, pre-1965 people were being cherry-picked,
they were being led along without appropriate health care coverage,
without insurance because they were perhaps dealing with a preexisting
condition, they were a complex case, they were ignored, they were
totally just abandoned by an insurance opportunity. Because of that,
our Nation, with compassion again, the history it wrote through those
LBJ years was to establish a Medicare program.
Look what happens. This chart will tell us when we get rid of
Medicare, when this Republican plan, if it had its way, ends Medicare,
we are going to see this very impact coming upon our seniors. We will
go back to the pre-1965 years. Look at this. This is the current
Medicare program, where benefits for our seniors enable them to avoid
oftentimes the out-of-pocket expenses.
It is forecasted by independent groups out there, not by partisan
thinking here in the House, but independent bodies are suggesting that
it will double in the early years in terms of what is expected of our
seniors digging deeper into their pockets. And by the year 2030, it's
forecasted triple what they are paying today. This is another way to
provide savings for the sole purpose of investing those savings in
millionaire, billionaire tax cuts, in oil company handouts, in
corporation relief. This is the effort here. It is a reverse Robin
Hood. It is going after the middle class, which is the strength of
America.
Give that middle class its purchasing power. Give our middle class
seniors
[[Page H2597]]
their Medicare program. Let them have dignity. Let there be a quality
of life. Let there be the opportunity for work, for employment, and let
the masses enjoy the benefits of those sorts of programs. That's what
we're talking about here. History repeated. Bad history repeated. Good
history ignored. And our seniors will suffer from this Medicare
program. This end to the Medicare program will bring about suffering
for them because of greed and because of the road to ruin that has been
established by this so-called path to prosperity.
Representative Yarmuth, I believe that we need to do better than
this. We should not fail our seniors, our disabled, and as
Representative Garamendi said, future generations of seniors, an
onslaught of baby boomers that will be impacted by all of this
activity.
Mr. YARMUTH. Thank you very much, Mr. Tonko. There are so many
aspects of this that deserve to be discussed. One of the things that's
kind of sad is that the Republicans, in talking about their plan to
privatize Medicare, say, oh, this is just like the plan that Members of
Congress have. Well, first of all, Members of Congress have the same
plan as every other Federal employee, so it's not necessarily anything
special that we have.
But the only thing that is somewhat similar about this is that you
have some options in the private sector. We buy insurance from private
vendors, and we have a certain allowance. And under the Ryan plan, the
Republican budget, seniors, all those under 55 now, when they become
seniors they would have a certain amount that they could spend--not
just could spend, had to spend in the private sector because they won't
be allowed to buy into any Medicare program or a public option. The
difference is, as you pointed out in your graphic there, that Members
of Congress and Federal employees pay about 28 percent of the premium.
Under the Republican budget, seniors are going to pay 68 percent of
their premium.
This is shifting the burden, the cost, and putting it on seniors who
are on fixed incomes, who don't have the ability to pay. And what's
going to happen to them? This is so unlike the Federal insurance
program. It's frightening in its dishonesty.
But I want to talk about one thing quickly and then yield to Mr.
Garamendi again, because we talked about taxes and tax rates. In the
Budget Committee last week I offered an amendment to the Ryan budget
that would have restored the Clinton era tax cut, highest tax rate of
39.6 percent on Americans making $1 million a year or more. Now, that
is a very small percentage of Americans. Very small percentage. Less
than 1 percent of the Americans make over a million dollars a year.
I said let's just have them pay what they paid under the Clinton era.
Not one Republican voted for that. And their argument was, and I know
they believe this because they keep saying it and have always said it,
that if you raise the tax rate on the highest-income Americans
that they're going to lose incentive, that they're not going to work as
hard, that they're not going to make investments because you are
eliminating their incentive.
Well, for those with a long memory, the highest marginal tax rate in
this country's history back in the sixties was 91 percent--I am sorry,
under the Eisenhower administration--was 91 percent. When my father
built his company in the sixties and seventies, the highest marginal
tax rate was 70 percent. When Ronald Reagan took office it was 50
percent. Now it's down to 35 percent, and they want to cut it even
further.
Now, they had this belief, again, that if you raise rates you're
going to destroy incentives. I built a company, both my brothers have
built very successful companies, my father built a very successful
company. Not one of us has ever said, oh, my gosh, because I can only
keep 60 cents of that next dollar I make rather than 64 cents or 65
cents, I am just not going to make that dollar. Just doesn't make any
sense for me to work harder. Business people don't think that way. That
is not human nature.
I have one brother who is very successful. He is in the barbecue
restaurant business. You have all heard me tell this story a hundred
times. I am going to tell it again. I asked him, ``What about this
marginal tax rate thing?'' And he said, ``You know, if people can't
afford barbecue it doesn't matter what my tax rate is.'' And that's
really where we are as a country. That's where we've come as a country.
Because we have let the middle class decline, because their buying
power has declined not just in relative terms, in absolute terms over
the last decade, while the wealthiest Americans, these people making $1
million, $1 billion and more have done extremely well.
Right now 1 percent of the American people make as much as the bottom
90 percent combined. We have the greatest disparity in income and
wealth in this country that we have had in almost 100 years. Yet ask
millionaires and billionaires to pay a little bit more--not a lot more.
We are not saying go to 70 percent. We are saying go to 39 percent from
35 percent. Not one Republican vote.
We've seen in the past what's happened with tax rates. We have been
talking a lot about history tonight. Under the Clinton administration,
during the Clinton years, top tax rate of 39.6 percent, 20.8 million
jobs created. After the Bush tax cuts, reducing that top rate to 35
percent, 653,000 jobs lost. That is not evidence for cutting the
marginal tax rate on the highest-income Americans even further.
We have seen again right now the Bush tax cuts--this is the job loss
thing--the economy floundered after the Bush tax cuts went into effect.
So again, all we're saying is if we're going to ask people to sacrifice
as we try to get our fiscal house in order, we need to ask everybody.
In particular, we need to ask the people who have done the best and who
have earned the most and who have the most wealth.
Again, the person who has talked more about what it takes to create
jobs in this economy is my colleague from California. I yield to him
again.
Mr. GARAMENDI. Thank you very much, Mr. Yarmuth. This is what you
were talking about here, a different way of saying the same thing that
you discussed. This is over the period of time from 1979 to 2005. This
is the income growth by each 20 percent of the population. So those
people at the very bottom saw almost no income growth at all, 200
bucks. And as you go to the next 20 percent and the next 20 percent,
you get up to the last 90 percent, they did okay. They made about
$745,000.
{time} 2050
So that's the 90 to 99 percent of the population. Those are very,
very wealthy people. They did okay.
But you go to the top 1 percent, the top 1 percent--excuse me, I am
wrong. That's the top one-tenth of 1 percent, not even 1 percent. One-
tenth of 1 percent. That population saw their wealth increase by nearly
$6 million each, and that's what you were talking about, a different
way of displaying it.
What's happening in the United States is this enormous shift of
wealth to the super wealthy, and our Republican colleagues want to
reward them for their good success by reducing their tax rate. So much
for shared sacrifice.
And as Mr. Tonko pointed out, the sacrifice is really the middle
class, because the benefits that the middle class had, the future
opportunity for Medicare, they are going to wind up paying more,
getting less, as the Republicans terminate Medicare as we know it
today.
The other part on taxes, and then I want to turn to one of my
favorite subjects, and that is how did we get to this deficit,
Republicans want to continue giving $12 billion to $15 billion of our
tax money, this is money that you, I, the stenographer there, the
people that work here, the men and women across America that are
working, $10 billion to $12 billion of their tax money, and they want
to hand it over to the oil companies.
Now, what in the world did the oil companies need a tax break for?
They need a subsidy like, well, like they don't need it. Why? Because
in the last decade, the oil companies, the big oil companies in the
United States, have earned $947 billion dollars in profits. That's just
shy of $1 trillion dollars in profits. And yet our Republicans demand
that we give them another $12 billion to $15 billion a year.
Now, that's bad enough. But I just came across this fact. ExxonMobil
was
[[Page H2598]]
the most profitable company in the world in 2008. In 2009, ExxonMobil
made $19 billion of profit. Well, good for them. And I am sure they
paid their fair share of taxes, right? Wrong.
Their effective tax rate was zero. So since they didn't pay any
taxes, we ought to give them another $12 billion, to the oil industry.
This is just plain wrong. This is not good economic policy.
One thing, and then I know you want me to talk about Make It in
America, and I will in a few moments, but I get so concerned when
people talk about the Democratic deficit. Hello? Not so, not a
Democratic deficit; really, a Republican deficit.
That fellow over there, that's Ronald Reagan. President Ronald Reagan
left at the end of his 8 years with a projected $1.4 trillion deficit,
followed by George H.W. Bush. At the end of the George H.W. Bush period
the projected deficit going forward would be $3.3 trillion. Thank you,
George H.W. Bush. Between the two of you, you really ran up the
deficit.
Then along came this fellow Democrat, Bill Clinton, put in policies
voted by Republicans and Democrats, raised the tax rate to what you
said, 39 percent for the super wealthy, and put in place PAYGO. That
PAYGO required that any new spending had to be paid for with cuts or
new taxes.
The result? Bill Clinton left office in 2001 with a projected $5.6
trillion surplus.
Then along came George W. Bush, Jr. What did he do? First year in
office, a tax cut. You were here weren't you, Mr. Yarmuth?
Mr. YARMUTH. I am sorry, no, I wasn't here. I didn't have the honor
of voting against those.
Mr. GARAMENDI. Okay, so you weren't here. A tax cut year one, a tax
cut year two, a war, two wars, Afghanistan and Iraq followed by a
Medicare drug program that wasn't paid for and the deregulation of Wall
Street. The result: He left office with an $11.5 trillion projected
deficit going forward. This is where we are.
The day Obama came into office, President Obama came into office with
a $1.3 trillion deficit the day he took office, and we worked ourselves
out of it. Thank goodness the two of you were here to vote for those
pieces of legislation. We are working ourselves out of it. That chart
that you showed a moment ago shows the growth of the economy.
We need to understand that we are not going to get out of this
deficit with the kinds of cuts that are being discussed by our
Republicans. It's going to take a balanced approach.
President Obama has set out a balanced approach. He said no growth,
no growth in the discretionary Federal budget. He will probably,
tomorrow, talk about how to hold down medical costs, and I gave you
some examples a moment ago. Those are the big drivers, and the
military.
You want to deal with this deficit? End the war in Afghanistan and
bring home $120 billion a year. We can do this. Tax policy? Let's let
the wealthy pay their share, let the oil companies pay their share.
Hold the expenditures steady and reduce it, as has been proposed, and
do it in a way that creates economic growth. We can do this. I know you
gentlemen on the Budget Committee fought hard for that kind of policy.
The Republicans refuse.
In fact, their proposal, it's 30 years before you eliminate the
deficit. We can't have that.
I will talk about Make It in America before we are finished here, but
I am going to turn it back to you Mr. Yarmuth. But I think it's really
important for the American public to understand where the deficit came
from and how it can be solved over the long run without harming
seniors, without taking away Medicare and by making the critical
investments that you have talked about, Mr. Tonko, education, research,
Make It in America, those kinds of things.
Mr. YARMUTH. I thank the gentleman. Just to elaborate a little bit on
the issue of what creates jobs and what kills jobs, under H.R. 1, which
was the Republican continuing resolution that was passed earlier this
year--we are still fighting that battle, and we will be fighting it
this week--but these are the principles that were reflected in here
that are now are reflected in the Ryan budget.
And this is what various economists said would happen if H.R. 1 would
go into effect, and this was just for 6 months of the year. Call it
``Slash-onomics.'' Federal Reserve Chairman Ben Bernanke--again this is
6 months, 200,000 jobs lost; Mark Zandi, who was John McCain's economic
adviser during his Presidential campaign, 700,000 jobs lost; the
Economic Policy Institute, 800,000 jobs lost; and the Center for
American Progress, just shy of a million jobs lost. That's over 6
months.
Now as we saw on the chart before, contrast that with what's happened
just under the Obama administration and the policies that we adopted
when we were in the majority. Job growth now, over 200,000 private
sector jobs last month created. We are on the right track.
And to slash spending the way that the Republicans have proposed,
without an accompanying increase in revenue, is going to do further
damage to what is now a solid recovery that's under way.
I just have to laugh a little bit again about the projections of the
Ryan Republican budget, because they have made a big deal out of saying
this is $6 trillion better than the Obama budget over the next 10
years.
Well, the way they get to that, once again we said it earlier, is to
project that unemployment will come down to 2.8 percent in 5 years,
which no economist says it would be. But more importantly, they say,
that we will increase revenues by almost double from $2.2 trillion
dollars last year to $4.3 trillion 10 years from now.
Now, to put that into perspective, the 10 years before that we went
from $1.9 trillion in revenue to $2.2 trillion in revenue. Now, we have
been up higher, we have been up around $2.5 trillion. That's the
highest we have been.
{time} 2100
Now they're saying we're going to cut taxes on corporations from 35
to 25 percent, we're going to cut taxes on the wealthiest Americans
from 35 to 25 percent, and yet we're going to experience unprecedented
growth in revenue even though we are cutting taxes. Again they can't
get anybody to verify this except the Heritage Foundation, which has
not been particularly accurate in the past. This is the Harry Potter
budget. This is their theology: Cut taxes, the economy explodes.
We've been down that road before, Mr. Tonko. I would like to yield to
you to talk about the Road to Ruin that we are about to be asked to
drive.
Mr. TONKO. Thank you, Representative Yarmuth. I believe we don't have
much time left in this hour of discussion. But let me just indicate
that this entire House experienced an election last November. Everyone
was up for election. And I would dare say in talking to many, many
colleagues about the message that resonated back at home it was about
jobs, jobs, jobs. It was about the economy. That was the driving
dynamic I believe at the voting booth.
And look at our track record here for the first 3\1/2\ months for the
112th session of Congress. Not one bit of legislation that would
produce jobs was brought to the floor. However, that budget, as you
just pointed out in your Slash-onomics bar graph, might take as many as
975,000 jobs off the picture for American workers, after we've spent
just over a year creating over 2 million private sector jobs. Now
that's in contrast with 8.2 million lost under the Bush recession. So
we've got a long way to go.
But why would you reverse progress with a budget that, with Slash-
onomics, reduces nearly--well, we'll even take some of the lower
estimates of 400,000; why would you want to do that at a time when we
are recovering from that very difficult economic time?
I think it's so important for us to inform the constituents out there
and tell middle class America this is a tipping point in our history.
This is whether we fix an economy, create a situation where we come
forth and produce products not yet on the commercial scene. A leading
nation can do that when it embraces its intellectual capacity. You
build products not yet discovered and engineered. That is making it in
America. That's what we can do if we invest in our workforce and invest
in our education. But we're
[[Page H2599]]
denying all those investments with this budget, just like this Medicare
chart which, as you indicate, will have seniors receiving 32 cents on
every health care dollar they require, and they're going to have to
fend for the rest.
So we're asking middle class America to pay more, everything but 32
cents on the dollar for their health care as seniors qualifying for
Medicare, and then we're going to take and destroy this economy and
snuff out the dreams and the opportunities for America's middle class.
We were told in November, America start growing the economy, stop
draining and reducing the middle class. You are reducing, you're
snuffing out that middle class. And that was the message.
And also on taxes I believe America is waking up to what has happened
here with some of these scenarios. They understand it is not about
who's cutting taxes but whose taxes are you cutting? Whose taxes will
you cut? There's a big difference. And when you do this mindless
handout to profit-rich oil companies, historically profit rich, sitting
on about a trillion dollars worth of profit, and mindlessly for nearly
a century we have handed out these benefits to oil companies. It's
wrong. We can do better. This plan is the Road to Ruin.
Mr. YARMUTH. I thank the gentleman. We have a couple minutes left. I
would just like to yield to my friend, Mr. Garamendi, for some closing
comments about making it in America.
Mr. GARAMENDI. If America is going to make it, we have to make it in
America. Once again, manufacturing matters. The problem with the
Republican budget is it hollows out, continues the hollowing out of
American industry by denying the research, reducing research and
reducing job training and continuing the kind of tax policies that
actually give corporations tax breaks when they send jobs offshore. We
want to reverse that. We're putting together the Make it in America
agenda, a real jobs agenda for the middle class.
Mr. Yarmuth, thank you so very, very much for bringing this to our
attention and carrying this discussion tonight.
Mr. YARMUTH. I thank the gentleman and thanks for his participation.
I just want to say in closing that budget battles are more about
dollars, and I think all of us on both sides of the aisle believe that
and live by that, or want to live by that. Budgets are about values.
Budgets are about what we care for in America. And one of the things
that I think we have always stood for in America is the idea that
anyone has the opportunity to reach his or her full potential, and to
be wealthy, but certainly to be happy and to be healthy.
What the Republican budget does is destroy much of that hope, destroy
much of that dream, slashing education, slashing research and
development, and slashing investment in infrastructure while at the
same time giving more and more tax breaks to wealthy individuals,
millionaires, billionaires, oil companies, Wall Street hedge fund
managers, and the people who have already had more than their share of
the American blessing.
So as we proceed in this debate this week on the budget and
throughout these next few months in the Congress, I want to make it
very clear that our values are at stake, not just our dollars, but our
values, and whether you call it the Road to Ruin, or as I look to call
it, the Pay Back for the Prosperous, the Republican budget does not
reflect our values. It does not lead to a brighter future for the vast
majority of Americans, and it should be rejected. We should move
forward with a budget that invests in our dearest, dearest asset, and
that is the American people.
____________________