[Congressional Record Volume 157, Number 108 (Tuesday, July 19, 2011)]
[Senate]
[Pages S4653-S4656]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
BALANCED BUDGET AMENDMENT
Mr. JOHANNS. Madam President, I rise today to speak to an issue that
I believe has all the potential in the world to define the future of
this great country. It is an issue with which all of us who are
participating in this colloquy are very familiar, and that is a
balanced budget. All of us are former Governors of the States from
which we come.
In my State, the State of Nebraska, our Nebraska Constitution
requires a balanced budget. It is not unusual. I believe 49 out of 50
States have this requirement in their constitution. It is not theater;
it is the way we do things at the State level.
In addition to that provision, however, our State constitution also
says the total amount of money the State of Nebraska can borrow is
$100,000. What does that mean? We must balance the budget on an annual
basis, and we cannot go out to the debt market and burden our children
and grandchildren by fulfilling promises that, quite honestly, we have
no idea how we pay for. We cannot do that.
Does that sound familiar? That is what the Federal Government does
every single year, and the Federal Government has been doing it for
decades. In Nebraska we are forced to prioritize and live within our
means. We have a very simple, straightforward philosophy. We do not
promise something we cannot pay for, and we do not buy something we
cannot pay for.
Is that unusual? Is that radical? Every working family in America
understands that, and they live by that simple concept: the simple
concept that they should not buy what they cannot pay for. If they do,
it gets them in trouble. Sadly, the Federal Government does not think
that applies. It thinks it is kind of a radical notion to apply that to
what happens in Washington.
Let's look at the results of this kind of policy in my State of
Nebraska. The unemployment rate in Nebraska today is 4.1 percent.
During one of the most difficult times since the Great Depression, the
unemployment rate in Nebraska never exceeded 5 percent. As I have said
before on this floor--let me state that a different way. That means
about 96 percent of Nebraskans have work.
Our State believes in the philosophy of less government. I have said
many times: Government does not create the jobs, the private sector
creates the jobs. It is small businesses and businesses willing to take
the risks that will get us out of the tough times we are in now.
When I was Governor, Nebraska went through some very difficult times.
I was Governor on 9/11. I was Governor when the dot-com bubble burst. I
did
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not have the option of walking into my State of the State Address and
standing there and saying: Folks, these are tough times. We are kind of
divided out here. We will not be passing a budget. Had I said that, I
would have been looking for another State to live in. I would have been
laughed out of the Governor's office.
There were no easy decisions, but there were necessary and important
decisions to be made. Nebraskan pragmatism would go a long way in
Washington, but my State is not unique. My State is not unique in terms
of this balanced budget requirement. In fact, I have other Governors
with me today.
I would like to start out by recognizing Senator Lamar Alexander of
the State of Tennessee. When Senator Alexander became Governor, I know
he had a lot of priorities, but he created an environment in which job
creators could thrive. He created that environment with the spending
requirements of his constitution. I would like him to tell us how he
did it, how he took his State forward even though he had to balance his
budget.
Mr. ALEXANDER. I thank Governor Johanns. It is terrific to be on the
Senate floor with other former Governors. When we were doing the health
care bill last year, I said everyone who voted for it ought to be
sentenced to serve as Governor for 8 years and actually try to
implement it. But let me try to answer the question briefly so we can
hear from the other Governors.
I became Governor 30 years ago, in the early 1980s. Inflation was 20
percent. It is hard to imagine, in the early days of the Reagan
administration, they had driven up interest rates to 12 percent to try
to bring inflation down. We had terrible times. Of course, we still had
to balance our budget. We had to live within our means. We had to have
the amount of money coming in equal to the amount coming out.
Let me tell one story of the difference that has made in our State
and how it could make a difference in the Federal Government. The other
day, in the Environmental and Public Works Committee, the Tennessee
chief highway engineer was testifying. He was there when I was
Governor. He is still there. One of the Senators, the chairman,
suggested perhaps some flexible Federal financing would be a good thing
for Tennessee; in other words, loaning some money to the State of
Tennessee to build roads.
The State engineer said: Madam Chairman, with all respect, we don't
want to borrow any Federal money. The State of Tennessee has zero road
debt.
That about brought the hearing to a halt because several Senators had
not ever heard of such a thing.
He said: Yes, that is correct. We have zero road debt. We use all of
our gas tax money to build roads, none of it to pay interest.
That means, I say to the Senator from Nebraska, when we have a tough
time like we did when I became Governor, as when he was Governor, as we
do in the country today, if our interest rates are low or we pay no
interest, we can use that money to get through tough times. A lot of
the businesses and the families today who have less debt are making
their way through these tough times more easily.
On the other hand, the Federal Government, according to the
President's budget, by the year 2020, would be spending more money on
interest on the Federal debt than it would on our national defense.
Interest on the Federal debt would be $931 billion by 2021.
What if that money could be put back in our pockets through tax cuts
or used to help send kids to college or build roads in the State or
energy research to lower the cost of gasoline? One way, I would say to
the Senator from Nebraska, that balancing the budget helps create jobs
is if we keep our interest payments down, we keep our taxes down, we
can spend our money wisely on things that count.
Mr. JOHANNS. Senator Alexander raises such a valid point. In the
State of Nebraska we don't have any road debt either. If we wanted to
pave a mile of highway we had to have the money in the bank or it did
not get done. The other advantage of that is when the economy started
to lift, we did not have to pay back all that money we had borrowed. We
were ready to take off. So I would have to imagine in Tennessee, like
Nebraska, our economic recovery was just much easier to achieve.
I had the pleasure of serving as Governor of Nebraska when Senator
Hoeven was Governor of North Dakota. The State of North Dakota is often
recognized as one of the best managed States in the country. It has its
fiscal house in order. It runs a surplus with some of the lowest
unemployment rates of any State in the country. Yet they suffered
through some of the same problems we had after the dot-com collapse.
Could the Senator talk to us a little bit about how the balanced
budget provisions in his constitution required him and the legislators
to manage the State?
Mr. HOEVEN. I thank Senator Johanns. It is an honor to be here with
him, and also with the good Senator from Tennessee, Lamar Alexander. It
is great to be here with them as well as Senator Risch from Idaho. We
have a common shared experience as Governors. It is wonderful to draw
on that.
I also have to mention that the Presiding Officer in the Senate
today, Senator Shaheen, is a former Governor as well. So we have that
common, shared experience, actually, here today on both sides of the
aisle. It is an honor and it is a pleasure to be here with you and talk
about this matter that is so very important, particularly as we face
the need to do something on the debt ceiling. This issue of dealing
with a balanced budget is paramount for our entire country and your
lead-in is exactly right. We served together as Governors. As a matter
of fact, the truth is, I would call the Senator--because he was elected
Governor before I was--for advice and ask him about some of the things
he was working on in Nebraska. Our States share many things in common;
one the Senator mentioned, a low unemployment rate. The unemployment
rate in our State is 3.3 percent. Again, I attribute that to the
ability of building a probusiness, progrowth, projobs environment that
stimulates private investments, stimulates jobs. The Senator mentioned
so very accurately that jobs are created by the private sector, not by
government. We have to create an environment that stimulates and
encourages and helps create a forum for that private investment. That
is how we create jobs and get this economy going.
On one side, we have to have a growing economy, which we don't have
at the national level right now, and on the other side we have to live
within our means. We have to control our spending, and the Federal
Government has a responsibility to control its spending just as the
States do, just as businesses do, just as families do. We have to not
only balance this budget, we have to live within our means on an
ongoing basis. We have 49 of the 50 States with either a constitutional
or a statutory requirement that they balance their budget every year.
Every single Governor with us today had to balance their budget every
single year. It was recently reported that 46 States are already on
track to make sure their budget is balanced by the end of their fiscal
year. The Federal Government needs to do the same thing.
Look at our situation right now. The Federal Government takes in $2.2
trillion in revenues. We take in $2.2 trillion in revenues, but we
spend $3.7 trillion. That is a $1.5-plus trillion deficit every year,
and that is rolling up to a debt that is now closing in on $14.5
trillion. We have to address this. This is not something we can hand
off to future generations. So our message to the administration is, you
are making it worse. We have to start living within our means. We
cannot keep spending and then borrowing and then raising taxes and
expect to have an economy that grows and a government that lives within
its means, and that is exactly why we are here today talking about the
need for this balanced budget amendment.
If one thinks about it, the balanced budget amendment gets everyone
involved both now and for the future because it has to be passed by
both Houses of Congress with a two-thirds majority. That has to be done
on a bipartisan basis and then it goes out to the States and three-
fourths of the States have to ratify it for it to become part of the
Constitution. That gets everybody involved in doing exactly what we
need to do; that is, getting on top of this deficit and this debt, both
now and for future generations.
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Again, I wish to thank the good Senator from Nebraska for holding
this colloquy and for inviting me to be part of it with my fellow
Governors. I appreciate it very much.
Mr. JOHANNS. Let me thank Senator Hoeven. I noticed today we are also
joined by another former Governor. In fact, we were both elected to the
Senate at the same time so we are both part of the same class.
Senator Risch, at one point in his career, served as Governor of the
State of Idaho. He had financial restrictions just as we did in terms
of a balanced budget. I ask the Senator, how was he able to deal with
important priorities while balancing the budget and bringing the
legislative process along in accomplishing that? Could the Senator talk
to us a little bit about that today?
Mr. RISCH. I thank Senator Johanns very much. I am honored to be here
with the other former Governors. There are a handful of us on each side
who have had the honor and privilege of serving their States as the
chief executive, so it is a real honor to be here, and I bring that
experience with me. I think every one of us brings that experience with
us. I not only bring that experience, but I did almost three decades in
the Idaho State Senate, balancing the budget and, indeed, I was in the
leadership, having to do what the leadership does here, as far as
bringing the two ends together, because we have a balanced budget
requirement in the State of Idaho, as virtually every other State does.
Does that create some angst when one is the chief executive or when one
is in the legislative process trying to balance the budget? Of course
it does. I am sure the Presiding Officer wound up with the same thing
in her great State as she tried to balance the budget because no matter
how much money one has, it is never enough. As Senator Johanns pointed
out, it is a matter of priority. This is not rocket science.
What the States do and, indeed, what businesses do and, indeed, what
families do around the kitchen table, either formally or informally, is
anticipate how much money is going to come in over the year, sometimes
over the month, sometimes over the week. They anticipate how much money
is going to come in and then they say: We have priorities. What is our
first priority? Of course, in a home, we have to be able to eat, we
have to have the utilities paid and a roof over our head, so those
become very important. To a government, obviously, if it is a State
government, education is the largest expenditure for virtually
everyone. For the Federal Government, obviously, the highest priority
is national defense. But we make a list. Then what we do is we allocate
the money we have to a list. When we are done, nobody ever stands and
says: That went very well. We have enough money. We have everything
funded. We are able to do everything we want to do.
No, absolutely not. Indeed, around here, in this city, this
government is spending $3.8 trillion. I can tell you, there isn't a day
that goes by where we don't get hit up with somebody saying: It is not
enough. Our agency doesn't have enough money. Why we can't even--blank.
Fill in whatever you want, whatever agency it is. Everybody tells you
they don't have enough money.
Yes, that is right. Because a balanced budget requirement
acknowledges a plain, simple fact of life; that is, there are not
enough resources to do everything we want to do. Indeed, a lot of times
there isn't even enough money to do what we need to do, but what we
have to do is we have to do the best we can with what we have. Without
a balanced budget amendment, it becomes the opposite of that--we keep
spending.
People say to me: Well, Jim, you have been in public service all your
adult life. Has anything in Washington, DC, surprised you? I said: Yes,
but only one thing. The stuff that goes on here doesn't surprise me at
all, except the cavalier attitude this city has and, indeed, this
institution has for the value of money. It astounds me that in this
institution they don't stop spending money when they hit the end of the
budget or they don't stop spending money when they hit the end of the
resources. They stop spending money when they run out of time. That
seems to be the only sideboard on how much money is spent. If we look
around--and people will criticize us on this--and say: You foolish
Republicans, what are you talking about? A balanced budget amendment,
that is dumb. You know what I say to them? Look at the States. Look
around at the States. There are two, maybe three States that are having
very difficult financial situations, and it is because they either
don't have a balanced budget amendment or they have done some
skulduggery to get around the balanced budget requirement they have.
But every other State has its financial house in order. Has it been
painful? Of course, it has been painful. It is painful to everyone when
they don't have enough money, including American families, but that is
simply the way it is.
One of the problems we are having is the basic foundation of the
difference between Republicans and Democrats. People who say there is
no difference between Republicans and Democrats ought to come and spend
the day here. They would find that philosophically we are hardwired
very differently. Similar to two brands of computers trying to talk to
each other, we are hardwired differently.
Republicans believe this Nation was founded with the idea we would
have a limited central government. It was founded by people who,
indeed, feared a central government. By the way, their fear, as we now
see every day, is very well founded. We believe in a limited
government. We believe in individual responsibility. We believe in the
responsibility of the States. It is hard to find people in this town
who actually believe the States are sovereign, that it was the States
that created the Federal Government and kept a leash on it and said you
can only have the powers we are specifically putting into this
Constitution. Now the courts over the years have expanded that
dramatically, but nonetheless, the vision the Founding Fathers had, the
American people had when they put together the country that created the
most successful, the wealthiest, the culture that enjoyed the best
quality of life anyone on the face of this planet has ever enjoyed
before, the Founding Fathers said: Look, we are going to create a
government for the individual, to give the individual the ability to
prosper, to give the individual opportunity.
That is what they said. They didn't sit around the table and say: You
know what we need is a nanny State. We need to create a government that
is going to take care of every American from the time they are born
until the time they die just as in Europe.
In Europe, the government pays for your birth. In Europe, the
government pays for your funeral and, indeed, it pays for a whole lot
of everything in between including every dime you spend after you
retire. That is not what America was founded to do. They did not sit
around and say: How can we take care of the whole society? They said:
How can we defend this country? How can we make sure no enemies come
into this country? How can we make sure people have the opportunity to
succeed? Yes, some will fail. Yes, some will succeed. Yes, we are going
to have poor people, and, yes, we are going to have rich people because
that is what a free society is all about, but everybody is going to
have the same opportunity. Everybody who is born into this country or
becomes a naturalized citizen in this country is going to have the
opportunity to succeed in a greater fashion than anyone on the face of
this planet has ever succeeded before, and they are going to do it
without government interference.
My goodness. How far we have come from those days and not in a good
way. They couldn't conceive they needed a balanced budget amendment
because the numbers we are talking about they never heard of. If a guy
sitting around the table said: By the way, do you know the country is
going to be over $1 trillion in debt someday, they would have said:
What is $1 trillion? How many zeros is that? They couldn't even
conceive of that, so they didn't put that in the Constitution. But this
isn't difficult to do. It is how much comes in and how much comes out
and they need to equalize each other.
I will be the first to admit our two parties don't understand each
other. As I said, we are hardwired differently, and I have a lot of
good friends on the other side of the aisle. We have good
conversations. They don't understand how I can possibly think we could
have a balanced budget, and I guess I don't understand how they think
we can
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spend ourselves into prosperity. We are, indeed, hardwired differently
than each other.
I watched one of the leaders the other day come out onto the floor.
He was carrying on about how bad the balanced budget amendment was. He
said it would be an admission of the failure of this institution to be
able to do its job. It would be abdicating our ability to do our job.
Look around. We are $14.3 trillion in debt. Do you think the American
people think we are doing our job, when we are at $14.3 trillion in
debt and now debating adding another $2.4 trillion to that? If a person
comes and spends a little bit of time here, they will understand this
institution cannot budget and do so responsibly. Given the opportunity,
it will spend and spend and spend and the only way this can be changed
is if we have a balanced budget provision in the Constitution just as
virtually every State in America has. We are going upside down at a
rate of $4 billion to $5 billion a day. We are borrowing new money, $4
billion to $5 billion a day. That is about 12 hours of the entire
annual budget for the State of Idaho. This can't go on. The way to fix
it is with a balanced budget requirement that puts a new rule in place,
and we need rules, we need sideboards when it comes to spending money.
I wish to thank the Senator for providing us with this opportunity.
Those of us who have actually lived in the real world where we could
not print money, we could not borrow the kind of money we are talking
about here, where we had to make responsible decisions--it is time this
government did that, and the only way it is going to do that,
regardless of flowery speeches given during campaigns--oh, send me to
Washington; I will take care of this; I will see we balance the budget;
I won't overspend--they come here and do it. The only way this can be
done is to balance the budget. Without a balanced budget amendment to
the Constitution, we can't do this.
The American people have to do this. We can vote to ask the American
people: Do you think we should have a balanced budget amendment to the
U.S. Constitution? Let's find out. Let's find out. There can't be
anything wrong with giving the American people the ability to do this.
It takes three-fourths of the States to ratify this. Let's give them
the opportunity. Let's have the debate. Let's pass this and give it to
the States and see if they want to do it.
Thank you very much. I appreciate the opportunity.
Mr. JOHANNS. Let me wrap up this colloquy this morning by thanking
each one of my colleagues for their comments.
Governors are practical people. We have to be. We have no choice. If
jobs are going to be created in our States, we must lead that effort--
not by jawboning and indicting the business community but by creating
the atmosphere that creates those jobs. If we are going to have a
balanced budget, we must lead that effort at the State level. Every
Governor who has had an opportunity to speak this morning in this
colloquy has made that point. At the end of the day, when our
legislative sessions were over, we had to be able to tell the people of
our great States that we passed the budget; that the budget was, in
fact, balanced; and, for some of us, that we did not borrow any money
whatsoever to get that job done. We could learn something in Washington
from that.
This is not a radical idea. All the rhetoric we have heard about what
a radical, crazy idea this is--well, how can it be so radical if 49 out
of 50 States have decided this is the right course and the right
direction for their State governments? I can't imagine the American
people want anything less for their Federal Government. And, as Senator
Risch has just pointed out, why would we not give the American people
the opportunity to cast their vote on how best to manage their
government--their government?
With that, I yield the floor, and I note the absence of a quorum.
The PRESIDING OFFICER (Mr. Tester). The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. REED. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
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