[Congressional Record Volume 163, Number 27 (Wednesday, February 15, 2017)]
[Senate]
[Pages S1197-S1202]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Tax Reform
Mr. COTTON. Mr. President, our Tax Code is a mess. No one voted for
it, no one wants it, and no one likes it. I have said many times we
should eliminate all of the special interest loopholes in the code and
use that money to cut taxes for everyone, including American
businesses. We want to encourage them to invest, grow, and create more
jobs right here in America.
I know my colleagues are working on a tax bill, and I want to stress
how much I support their efforts. I will, of course, withhold judgment
on any proposal until I see the final text, but I also want to say
today, I have reservations about one idea that is being considered. It
is called a border adjustment tax. It sounds like something from
Orwell's Newspeak.
Here is how it would work. We would cut taxes for corporations. To
make up for the lost revenue, we would tax businesses whenever they
bought something from another country. For instance, every time Ford
bought an auto part from Canada, it would pay a 20-percent tax or every
time your local grocery store bought bananas from Guatemala, it would
pay a 20-percent tax. Whatever money businesses made from selling their
products in other countries would be exempt. In other words, what all
this would amount to is a 20-percent tax on imports. The proponents of
this tax contend it would stop businesses from leaving our country
because right now some are moving overseas to avoid paying our
corporate tax rate, which is the highest in the modern industrial
world. Under this proposal, it would not matter where you put your
headquarters, you would be taxed according to what you bought, not
where you put down your stake.
The hope is, this arrangement would mean more headquarters, more
factories and the jobs that come with them staying right here in
America, which of course is a desirable goal, no doubt, but I am not at
all convinced this is the best way to do it. Consider this. It is
estimated that this one change alone would produce something like $100
billion a year in additional tax revenue. That is a lot of money, and
someone has to pay for it. I will tell you exactly who is going to pay:
working Americans who have been struggling for decades. A tax on
imports is a tax on things working folks buy every single day. I am not
talking about caviar and champagne. I am talking about T-shirts, jeans,
shoes, baby clothes, toys, and groceries.
I have heard from thousands of Arkansans who are already struggling
just to get by. Why would we make the stuff they get at Walmart more
expensive? Its defenders say the tax will not increase the cost of
imports. What will happen, they say, is our exports will be cheaper
because we no longer tax them so then more people overseas will buy our
exports from us, which means the dollar itself will increase in value.
That means imports will not be expensive because you will be able to
buy them with a stronger dollar. So even with the tax added on, you
will still come out right where you were before.
This logic reminds me of Orwell again: Some ideas are so stupid only
an intellectual could believe them. This is a theory wrapped in
speculation inside a guess. Nobody knows for sure what will happen. No
one can know for sure because currency markets fluctuate daily based on
millions of decisions and events. Just because an economist slaps an
equation on a blackboard does not make it real so I am more than a
little concerned these predictions will not pan out.
As the old joke goes, after all, economists have predicted nine of
the last five recessions. But if that happens, it will not be
economists and intellectuals and politicians in Washington and New York
left holding the bag; working Americans will get stiffed again.
Finally, I want to say a word about jobs. One of the biggest reasons
for fixing the Tax Code is that it would help create more jobs, but if
we increase the cost of goods, people obviously can't buy as much,
which will hurt retail sales and retail jobs too. Retail companies are
the largest private sector employers in almost every State. Are we
really going to impose a huge tax on the livelihood of so many
Americans and say: Oh, don't worry. It will all work out in the end.
We have to take a hard look at this proposal right now. Therefore,
while I support fundamental tax reform and commit to reserve judgment
on any final bill until I read it, today I want to put on the record my
serious concerns about a border adjustment tax. Many other Senators
share those concerns. We most certainly will not keep our powder dry
and see working American's railroaded with a precooked deal that raises
their taxes and increases the price of the stuff they buy every single
day.
It is February 15. By law, the President is required to submit a
budget to Congress by the first Monday of this month. That was over a
week ago. Now, being a new administration, we expect him to be a few
weeks late as has typically happened in recent times. The difference
this year, though, is that President Trump still does not have a budget
director. We are 4 weeks into his Presidency, and we are only just now
getting around to confirming his nominee.
For those of you keeping score at home, that is the longest delay in
recent history. Every one of the last six Presidents had their budget
director confirmed by a week's time--as in 7 days. In other words, what
we are seeing is a deliberate act of obstruction. Here is the real
problem. We have serious work to do. It is that much more difficult for
the President to do his job when all he has is a headless horseman
bureaucracy.
Senate Democrats might consider this payback. They might consider it
their chance to audition for the 2020 Presidential primary, but the
American people are the ones paying the price for this obstruction.
I want to say again, this is not a game. This is not a protest. This
is our job. This is what the American people sent us to do. It is time
we got down to business. In that spirit, I want to say a few words in
support of the President's
[[Page S1198]]
nominee for the Director of the Office of Management and Budget, Mick
Mulvaney. I don't have to cite or recite Mick's biography for many of
you.
He has been representing the good people of South Carolina's Fifth
District in the House of Representatives for more than 6 years now.
Before that, he led an impressive career as what he called a serial
entrepreneur, starting four different businesses. I hear some of them
may have even succeeded.
He has worked in fields as varied as law, real estate, homebuilding,
and restaurants. He is highly educated and very accomplished. I would
like to point out, he is a friend of mine, a trusted confidant, someone
whose advice and counsel I have often sought.
I can say with confidence, he will serve President Trump and the
American people with dedication and distinction. I believe Mick will
bring a needed voice to the President's Cabinet, a voice for fiscal
responsibility after so many years of irresponsible sky-is-the-limit
spending.
All that experience in the real economy gives him something more than
a lengthy resume. He knows from personal experience what it takes to
create jobs and create opportunities out of almost nothing. He knows
the self-discipline it takes, the hard work, the perseverance. He knows
what Americans have to go through every day just to earn an honest
dollar. That is why he has been so protective of every taxpayer dollar
ever put in his care. That is the kind of man we need as our next OMB
Director.
It is only when Washington appreciates what goes into making all of
those taxpayer dollars that it will show the taxpayers the respect they
deserve. I want to express my strong support for the next Director of
the Office of Management and Budget, my friend, Mick Mulvaney.
I yield the floor.
The PRESIDING OFFICER. The Senator from New Hampshire.
Mrs. SHAHEEN. Mr. President, unfortunately I don't share the
enthusiasm of my colleague from Arkansas for Mick Mulvaney to serve as
the Director of the Office of Management and Budget. In fact, I have
great concerns about this nominee's views on a whole range of issues.
Because those views are far outside the mainstream of this country, I
intend to vote against his confirmation. First and foremost, I am
concerned about Mick Mulvaney's repeated votes against raising the debt
ceiling and his reckless willingness to shut down the government in
order to advance his extreme views.
It is Representative Mulvaney's longstanding position that failure to
raise the debt ceiling would not precipitate a crisis. He said: ``I
have yet to meet someone who can articulate the negative
consequences.'' Well, let me articulate the consequences in very simple
terms. If we refuse to raise the debt ceiling, we would default on the
national debt, destroy the credit worthiness of the U.S. Government,
and trigger a global financial crisis.
As the Governor of New Hampshire, I worked very hard with our State
treasurer and with the legislature, through some very challenging
fiscal times, to maintain New Hampshire's State bond rating. We did
that because we knew that lowering the State's bond rating would mean
an increase in costs for businesses trying to borrow money, for the
government trying to borrow money, for taxpayers because they would
have to pay those increased costs, and it would have a ripple effect
across the economy that would have a real impact on the people of New
Hampshire.
Representative Mulvaney does not seem to appreciate what would happen
if the Federal Government defaulted on our debt. He has argued that the
Treasury Secretary could avoid such a crisis by prioritizing interest
payments; in other words, paying foreign holders of U.S. debt but not
Social Security beneficiaries or the men and women of our Armed Forces,
but there is no legal authority to do this. It is impractical, and
recent Treasury Secretaries have denounced the idea. We got a foretaste
of the consequences of default in 2011, when Representative Mulvaney
and others blocked legislation to raise the debt ceiling, a crisis that
took nearly 3 months to resolve.
That manufactured crisis shook financial markets, caused a spike in
interest rates on U.S. securities, and it lead Standard and Poor's to
take away America's AAA credit rating, and it cost $18.9 billion. Who
does Mick Mulvaney think paid those $18.9 billion? It was the people of
this country. Representative Mulvaney has repeatedly threatened to shut
down the Federal Government.
He helped lead the charge in shutting down the government in October
of 2013 in a failed and misguided attempt to repeal the Affordable Care
Act. In 2015, he threatened to shut down the government again in order
to defund Planned Parenthood. Both of those programs are critically
important to the people of New Hampshire. Nearly 1 out of 10 Granite
Staters have health insurance thanks to the Affordable Care Act.
Planned Parenthood provides accessible, affordable healthcare to women
all across the State of New Hampshire, women who, in most cases, could
not get their healthcare any other way.
As Senator Durbin pointed out earlier, 97 percent of the services
provided by Planned Parenthood are services that have nothing to do
with abortion; they have to do with access to mammograms, to cancer
screenings, to STD testing, the whole range of healthcare services that
women need.
Unfortunately, the 16-day shutdown in 2013 created havoc across the
economy, leading to the loss of an estimated 120,000 jobs. Millions of
small businesses faced significant disruptions, many employees were
laid off, and some businesses could not make payroll. But
Representative Mulvaney is unrepentant. He insists that the shutdown
was worth it. Well, tell that to some of the businesses in New
Hampshire that took a huge hit. His brand of government by temper
tantrum is reckless, it is irresponsible, and it should not be rewarded
with a nomination to be the chief budget officer for the country.
Representative Mulvaney's disdain for true fiscal conservatism and
his unbalanced budget priorities should also give us pause. He supports
budgets that would provide massive tax cuts for corporations, for those
at the top, and he would pair those with deep budget cuts for the
middle class and the most vulnerable people in our society, including
seniors and people with disabilities.
Representative Mulvaney advocates for radical cuts to Social Security
and to Medicare and Medicaid. He has promised to end Medicare as we
know it, privatizing it and converting it to a voucher program that
shifts costs to seniors.
He advocates raising the retirement age to 70 for Social Security and
67 for Medicare. Imagine telling construction workers and others who
perform heavy labor that they have to work until age 70 before they can
retire with the security of a Social Security check.
He also advocates shifting costs to States by block-granting
Medicaid. Essentially what block grants do is give the money to States
and allow them to administer those dollars. As a former Governor, I
think States can administer those dollars, but when you want to cut as
much as $1 trillion from healthcare services, which is what Mick
Mulvaney wants to do, then you can administer them as well as possible,
but you are still not going to be able to make up to the seniors and to
disabled Americans and others in nursing homes for the cuts that are
going to come when you block-grant those dollars to States.
Unfortunately, that is not the end of his extreme budget ideas. He
advocates taking a meat-ax to the whole range of programs that bolster
the middle class, everything from cancer research, to Pell grants, to
healthcare.
Representative Mulvaney has even questioned the appropriateness of
Federal funding for scientific research. In a Facebook post questioning
the scientific consensus linking the Zika virus to microcephaly, he
wrote: ``What might be the best question: Do we really need government
funded research at all?'' Think about that.
Senator Durbin was very eloquent in talking about the difference that
research has made in ending polio and addressing so many other
diseases, such as HIV, that have affected Americans and people across
the world. Well, the President's choice--Mick Mulvaney--to draft his
annual budget, to be the head of his budget office, openly doubts that
the government should be involved in addressing public
[[Page S1199]]
health threats, such as Zika. So how deeply does he plan to cut funding
for the Centers for Disease Control, for the National Institutes of
Health, for our National Laboratories, and for federally funded
extramural research? We don't know the answer to that, but we can
assume from his statements that it is going to be significant.
Federally funded R&D is critical not only to addressing threats to
public health but also to developing new technologies that enhance our
national security and protect the environment. These technologies are
essential to growing our economy and maintaining America's global
leadership in technology and biomedical sciences.
In New Hampshire, the most dynamic sector of our economy is high-tech
manufacturing and innovation. For our economy to grow, we need to stay
ahead of global competition. But that doesn't happen on its own; it
requires sustained investment in basic research--often research that
the private sector considers too risky to do on its own.
As ranking member of the Senate Small Business Committee, I have seen
this vividly demonstrated by the very successful Small Business
Innovation Research Program, or SBIR. SBIR works by harnessing the
creativity and ingenuity of America's small businesses to meet the R&D
missions of our Federal agencies, while also supporting the growth of
small, high-tech companies that create good jobs in local communities
across this country.
One recent study found that every dollar awarded by the Air Force to
SBIR firms generated $12 in economic growth. That growth happens
because small businesses develop technologies and then commercialize
those technologies, creating good jobs in each of our States.
Many of these technologies are developed for our Armed Forces to
better protect the homeland. A great example of that, which I have seen
firsthand, is a company based in Hanover, NH, called Creare. Creare is
working with the Navy to develop an innovative clothes dryer that
dramatically reduces the risk of fires on submarines, and that is just
one example of why the SBIR Program is the envy of the world.
I want to quote Dr. Charles Wessner, who led the National Academy of
Sciences study of the SBIR Program. In describing that program, he
said: ``The rest of the world thinks this is the greatest thing since
sliced bread.''
Well, make no mistake, this successful program is in serious jeopardy
if Representative Mulvaney puts Federal R&D investments on the chopping
block.
It is truly shocking that the President has nominated a budget
director who questions the value of Federal funding for R&D. We need to
invest in science. We need to invest in our small businesses, which
create two out of every three jobs in this economy.
The OMB Director is one of the most senior economic advisers to the
President of the United States, with enormous influence on policy
matters.
Representative Mulvaney has been a zealous advocate for radical cuts
to Social Security, to Medicaid, to the whole range of programs that
support the middle class in this country. In addition, his willful
failure to pay required Federal taxes has raised serious concerns about
his integrity, which we all know is essential for every Cabinet
officer.
After careful study of his record, I urge my colleagues on both sides
of the aisle to come together to reject this nominee. Putting Mick
Mulvaney in charge of OMB is not just letting the fox guard the hen
house; it is giving him a gun to kill the chickens, a pot to boil those
chickens in, and a knife to eviscerate them when they are done.
Let's give President Trump the opportunity to put forward a qualified
candidate with mainstream views to protect the middle class and to
honor this Nation's financial obligations.
Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Sullivan). The Senator from Wisconsin.
Mr. JOHNSON. Mr. President, I rise today to support the nomination of
Congressman Mick Mulvaney and ask my colleagues to vote to confirm him
as the next Director of the Office of Management and Budget.
It may not surprise folks that I have a markedly different viewpoint
than the Senator from New Hampshire. Congressman Mulvaney wants to save
Social Security and Medicare. Congressman Mulvaney wants to prevent,
stop the mortgaging of our children's future, the bankrupting of
America.
One thing on which I do agree with the good Senator from New
Hampshire is that we need to concentrate on economic growth. It is the
primary component of the solution. But this Nation faces many, many
challenges. From the standpoint of foreign policy, take a look at what
is happening around the world, the turmoil in so much of the world. We
are in a generational struggle against Islamic terror, against ISIS,
al-Qaida. Iran--that nuclear agreement was horrible. It modified the
behavior for the worse. We have just witnessed North Korea test-fire
another missile. Combined with their nuclear capability at some point
in time--probably not in the too distant future--they will threaten
America. China has been emboldened. Russia has become more aggressive.
Why? Because in so many instances, these nations perceive America as
weaker than we once were, lacking the strength and resolve to provide
the leadership, project our values around the world.
With all these threats that America faces, at the same time our
military is being hollowed out. We won't have the resources militarily
to fight back if they strike first.
Domestically, we also face many perils, many challenges. ObamaCare
didn't work. The Patient Protection and Affordable Care Act did not
protect the patients. It is not affordable. In my State, Wisconsin,
premiums on the individual market have doubled and tripled. A young
mother working a part-time job so she could stay home with her children
had to quit that job to take full-time work to pay her $8,000 per year
increase in premiums. Wages have stagnated for years. Our
infrastructure is old and in many cases, crumbling. Our borders are
porous. We are not winning the War on Drugs because of porous borders
in many respects. Unfortunately, the War on Poverty has also not been
won. In many cases, it has created perverse incentives that have
trapped generations in a cycle of poverty and dependency and despair.
It has resulted in the national debt rapidly approaching $20 trillion.
Again, that is that mortgaging our children's future that Congressman
Mulvaney wants to prevent.
As the chart nearby shows, we are on a completely unsustainable path
that Congressman Mulvaney also understands must be stopped. If you take
a look at this chart, according to the Congressional Budget Office,
over the next 30 years, our projected deficit will total $103 trillion.
That would be put on top of that $20 trillion in debt. It will be $10
trillion over the next 10 years, $28 trillion in the second decade, $66
trillion in the third decade. That is completely unsustainable.
By the way, the components of that $103 trillion deficit--$14
trillion in Social Security. In other words, Social Security will pay
out $14 trillion more in benefits than it takes in from the payroll tax
over the next 30 years; Medicare, $34 trillion. The remainder of that
$103 trillion is interest on the debt. If we want to avoid paying
creditors more than $50 trillion in interest on our debt over the next
30 years, we need to address Social Security and Medicare. Congressman
Mulvaney wants to do that. He wants to save Social Security and
Medicare--not demagogue it; save it.
As the Senator from New Hampshire was pointing out, we need economic
growth. That is the No. 1 component of the solution. I don't care what
problem I just mentioned above, economic growth is the primary
component of the solution.
What is hampering our economy from growing? The fact is, since the
Great Depression, our economy has averaged 3.2 percent annual real
growth. Since the great recession, we have only been growing about 2
percent. I would argue that there are a number factors causing that
tepid growth: overregulation, an uncompetitive tax system. We are not
fully utilizing our energy resources. The Presiding Officer certainly
understands that from his State. We are not utilizing our abundant
energy resources. And of course there is this: our unsustained fiscal
path, our $20 trillion in debt.
I oftentimes make the analogy between our national debt and a family
in debt over their head. It is just a nation-state; it is just many,
many, many
[[Page S1200]]
orders of magnitude larger. But the fact is, if you are a family in
debt over your head, how can you grow your personal economy? All your
disposable income is spent on the basics and servicing the debt. The
same thing is true of a nation-state. Again, our enemies perceive that
weakness caused by our indebtedness.
So when you take a look at the role of the Director of the Office of
Management and Budget, what we need to do to grow our economy comes
under his jurisdiction basically. He has to address this deficit. He
has to put forward a budget that is sustainable. Mick Mulvaney is
dedicated to doing that.
Then, of course, the other thing the Office of Management and Budget
is really designed to combat is overregulation. They are all about
taking a look at cost-benefit and making sure the regulations that are
implemented by this Federal Government are reasonable from a cost-
benefit relationship. That has not been the case recently.
Just a couple of examples of how economic growth really is going to
help solve this problem. If you go from 2 to 3 percent annual growth,
that is $14 trillion in added economic benefit in just over a decade.
If you go from 2 to 4 percent, that is $29 trillion. And even with the
meager economic growth we have had since 2009, revenue to the Federal
Government has increased by more than $1.1 trillion per year with
meager economic growth. Just think of what would happen if we could
reduce the regulatory burden, have a competitive tax system, and put
our Federal Government on a sustainable fiscal path. Revenue would be
flowing to the Federal Government, we could stop hollowing out our
military, and we could start addressing these threats.
As to the regulatory burden, when we held hearings on this in my
committee, the numbers showed that regulatory burden at $2 trillion per
year. Just put that into perspective because I know we are getting
immune to these massive numbers: $2 trillion is larger than all but 10
economies in the entire world. That is a self-imposed, self-inflicted
wound on our economy. If you take that $2 trillion and divide it by the
number of households in America, it is $14,800 per household. No
American writes a check to the Federal Government to pay their share of
the regulatory burden; instead, they realize that burden in reduced
opportunities.
Why are wages stagnated? That is a good part of it--increased prices,
and of course, again, those lower wages. It is a massive problem. One
Wisconsin paper manufacturer I was talking to--and by the way, I can't
tell you who because he fears retaliation by the government, which is a
different subject--did a cost calculation of just four recently issued
regulations and came up with a total cost of $12,000 per year per
employee. There you go. That is money that could have been available
for increasing wages or for investing in business to create better
opportunities and better paying jobs. The regulatory burden is massive.
I had the chancellor of the University of Wisconsin-Madison come into
my office during the last 2 years with the primary complaint--the
primary ask--being to reduce that regulatory burden. Last year, she
came in armed with a study commissioned by research universities that
said that 42 percent of researcher time on Federal grants was spent
complying with Federal regulations. Think of the opportunity cost of
that overregulation. Those Federal grants are meant to pay for studies
and doing research on curing diseases, not filling out Federal
paperwork. So again, the Director of the Office of Management and
Budget will take a look at those regulations, particularly now under
this President, who has issued an Executive order to make sure that for
every one regulation issued by a new agency, they have to remove two.
That is a very good start. I would have gone with one-in, ten-out, but
I will settle for one-in, two-out. I will certainly be supportive of an
Office of Management and Budget that understands the incredible burden
of overregulation on our economy.
During our committee markup--I heard earlier the Senator from
Arkansas, who knows Congressman Mulvaney, served with him in the House,
and understands how dedicated and serious Congressman Mulvaney is to
stopping this mortgage of our children's future. Senator Lankford also
had the opportunity to serve 4 years in the House with Representative
Mulvaney. This is what Senator Lankford had to say about his friend and
colleague at the nomination hearing:
You were a serious student. You looked hard at difficult
issues. You understood that there were difficult decisions
that needed to be made and made proposals to do that.
In testimony before our committee, Congressman Mulvaney told my
committee:
When President-elect Trump announced my nomination, he
noted that our nation was nearly $20 trillion in debt and
stated that I have the skills and convictions to responsibly
manage our nation's finances. I believe that is why he
nominated me for this position.
He went on to state:
For the first time in America's history, the next
generation could be less prosperous than the generation that
preceded it.
That is a very sad possibility. We need to prevent that.
He went on to say:
To me and to the people in this room, that is simply
unacceptable. We CAN turn this economy, and this country
around . . . but it will take tough decisions today in order
to avoid impossible ones tomorrow.
Congressman Mulvaney went on:
I believe, as a matter of principle, that the debt is a
problem that must be addressed sooner, rather than later. I
also know that fundamental changes are needed in the way
Washington spends and taxes if we truly want a healthy
economy.
Again, he fully understands the connection between our unsustainable
fiscal path, our deficit, our debt, and economic growth. He said we
``must include changing our government's long-term fiscal path--which
is unsustainable.''
Finally, he said:
I recognize that good public service--whether in a state
legislature, Congress, or OMB--takes both courage and wisdom.
The courage to lead, and the wisdom to listen. I have learned
that I do not have a monopoly on good ideas. Facts--and the
cogent arguments of others--matter. I will be loyal to the
facts and to the American people whom I serve.
My commitment to you today is to take a fact-based approach
to get our financial house in order.
This is exactly the type of person--Congressman Mick Mulvaney--
somebody who is dedicated to solving these problems, who has the
courage and the wisdom to stop mortgaging our children's future, to put
America's budget on a sustainable fiscal path, to grow our economy, to
make sure that future generations inherit a stronger, more prosperous
America.
I am proud to support and I urge all my colleagues to support and
vote for the confirmation of Congressman Mick Mulvaney to be the next
Director of the Office of Management and Budget.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Delaware.
Mr. CARPER. Thank you, Mr. President. I rise this evening to speak on
the nomination of Congressman Mick Mulvaney to be the Director of the
Office of Management and Budget. I am going to start by talking in a
minute about some of the critical roles that the Office of Management
and Budget plays.
Before I do that, I want to go back for a moment to some of the
comments of my friend who just preceded me on the floor. Going back 8
years ago, I remember that in the last 6 months of 2008, we lost 2.5
million jobs in this country--2.5 million jobs in 6 months. In the
first 6 months of 2009, we lost 2.5 million more new jobs. That is 5
million jobs in 12 months.
Since the beginning of 2010, we have added 16 million jobs in this
country. The unemployment rate in this country jumped as high as 10
percent by the end of 2009, and by the beginning of this year the
unemployment rate was cut in half. During the first fiscal year of this
last administration, the Obama-Biden administration, the deficit, the
budget they inherited for that fiscal year ballooned to $1.4 trillion.
I am an old State treasurer, Congressman, Governor, and now Senator.
That's a lot of money. We have had in terms of GDP probably higher
deficits than that during World War II, but that is a lot of money.
During the last administration, the debt, deficit as we knew it,
dropped by about two-thirds, maybe a little more than two-thirds. Do we
have a balanced budget coming into this year? No. Is it better than
$1.4 trillion? It sure is.
[[Page S1201]]
The unemployment rate was cut by half, the annual deficit has been
cut by two-thirds, and instead of losing 5 million jobs as we did in
2008 and 2009, we added 16 million jobs. Could we do better than that?
We have. Have we ever had a longer running economic expansion in the
history of our country than the last 7 years? I am told we have not.
Can we do better? Yes.
Hopefully, in our spending plans and in the regulatory work that we
do, we will adopt policies that provide the kind of environment that
leads to job creation and job preservation. That is what we do. We
don't create jobs here. As my friend who is presiding knows, we help
create a nurturing environment for job creation. One of the things we
need for that is commonsense regulation.
If you look at the role of the OMB Director, one of those listed on
this chart, No. 2, is regulatory process. The regulatory process is the
way regulations are created in this Congress, and as the Presiding
Officer and others know, it is dictated by legislation called the
Administrative Procedure Act.
If the Presiding Officer were an agency that was considering
promulgating a rule or regulation, the agency would basically say to
the rest of the world: We are thinking of promulgating a regulation on
subject x. It is really a heads-up that they are thinking about doing
this. It doesn't mean they are going to, but they are thinking about
it, so those who might be affected by that regulation, regulation x,
would have a chance to say: Hmm, something might be coming our way, and
we have an interest in it--or we don't. This gives them a chance to go
to the agency and say: We hear you are interested in promulgating a
regulation on this particular subject. Let's talk about it. That is why
the agency gives a heads-up, so that those who might be affected by it
have the opportunity to talk to the agency, come to their elected
officials, and share their opinions.
The agency can accept the comments they get or reject them. The
Members of Congress can accept or reject them. We can actually arrange
for our constituents who might have an interest in a proposed or
possible regulation to arrange for meetings to make sure the agency
that is thinking about promulgating a new rule or different rule or
regulation has an opportunity to meet with those who would be affected
positively or negatively.
The agency, armed with that information--the input they receive from
filing a notice of rulemaking--if they decide to go forward, they will
eventually propose a draft rule. This is not a final rule or
regulation, but a draft. They promulgate that draft regulation under
the Administrative Procedure Act, and those who are interested in or
affected positively or negatively by the draft regulation again have
the opportunity to go back and talk to the folks who promulgated that
rule or regulation, stating what it is they like or don't like,
proposing changes. They look us up--the Representatives, Senators--and
say: Here are our concerns. We think this should be strengthened or
weakened or taken out or added.
There is a period of time--a comment period--for the draft
regulations. Sometimes those who can be affected by the regulations
will come to us and say: We don't think we have enough time to fully
understand what the effects of this draft regulation would be, and we
would like to have more time to comment. Then what we do as elected
officials is reach out to the agency and say: We don't have enough
time. We are hearing from too many of our constituents that there is
not enough time. How about another week or month or some reasonable
period of time? Sometimes we get what we ask for, and sometimes we
don't. Sometimes we get half of what we ask for, but that is the way it
works.
At the end of the day, the agency may decide that they have enough of
a bad response--bad vibrations from those who would be affected, as
opposed to picking up good vibrations--and the agency may pull the reg
entirely and say: We will do this another time but not now. But they
might go ahead and change the drafting to prepare to offer the final
regulation.
When the agency is ready to report out the drafted regulation, that
is not the end of it because that is where OMB comes into play. There
is an agency within OMB called OIRA, which refers to an oversight role
that the OMB plays. Essentially, as we used to say in the Navy, if a
message or something were sent from one level of command to another to
another, we actually say we ``chopped'' it through different levels of
command. My colleague who has better experience in the military, as I
recall, may have had a similar kind of experience. But the draft
regulation that is promulgated has to be chopped through OMB. It has to
be chopped through OMB. They have the final say, and they can kick it
back to the agency or not.
Changes may or may not be made, but eventually the final reg is
published in the Federal Register. There is a period of time that runs,
and eventually if folks really don't like it enough they can basically
file a suit and go to court to try to block the regulation. We see that
happen from time to time. Faced with a suit, the agency might want to
pull it back and make some further modifications. We can join in those
amicus briefs or not. If all else fails, Harry Reid, who used to be the
majority leader, a Democrat, wrote a law a number of years ago, the
Congressional Review Act, which allows the Congress, years from now, to
take another look and see if it is something--it is not that old, it
had regs come out in the last couple of months--and ask: Is this a good
idea or not? And if the majority of the House and Senate, with the
consent of the President, say: No, we don't think this regulation is a
good idea, it can basically be taken off the field and put on the
shelf.
That is the way the process works. Some people don't think that is a
very good process. I think it is pretty good. I hope that if Mick
Mulvaney is confirmed to this job, this regulatory process is one that
will be put to good use.
One of the things Cass Sunstein did, at the direction of President
Obama, was begin a look-back policy, saying we are going to look not
just forward for new regulations, we are going to look back at the old
ones we have and see which ones have maybe outlived their utilization
and should be eliminated or modified. I have stopped counting how much
money has been saved during the look-back process over the last several
years, but it is in the billions of dollars--maybe even in the tens of
billions of dollars by now. I hope the next OMB Director will continue
it.
We have been joined here by my colleague from Michigan. I would just
ask him if he is pressed for time. I will go maybe about another 10
minutes, and then it is all yours.
Another big job of the OMB Director, not surprisingly, is to help the
President prepare in submitting a budget. I want to take just a minute
and maybe use another chart to talk about how we spend our money. As my
colleagues know, the spending is a pie chart kind of like this, and it
is divided into maybe four major areas. One of those is--some people
call it mandatory spending. I call it entitlement spending: Medicare,
Medicaid, Social Security, maybe veterans' benefits. It is spending the
people are entitled to by virtue of being a certain age, being
disabled, maybe having served in our Nation's military, maybe being
disabled in the course of military service, maybe they earned a GI
bill. Those are the kinds of things that are being considered as
entitlements or mandatory spending. As a percentage of the budget, if
we look at the green colors here, it adds up to a little more than half
the budget.
Another maybe 5 to 10 percent of the budget is this sort of beige
color or gray--this area right here. It is about 5 to 10 percent of the
budget. It is debt service, principal interest on our Nation's debt.
Fortunately, our interest rates are low. If they ever go up, ``Katy,
bar the door.'' Then the principal on the debt service will go up a
whole lot. We have been blessed with low interest rates. It will not be
that way forever.
So entitlement spending, a little over 50 percent; debt service,
principal interest on the debt, 5, 10 percent.
The rest is called discretionary spending. It is defense spending so
it is about 40 percent discretionary spending. That is the spending
that is done by our Appropriations Committee, about a dozen
Appropriations subcommittees, including Agriculture,
[[Page S1202]]
Armed Services, Housing, Transportation, you name it.
Over half of the amount of spending that is called discretionary
spending, right here in the blue, more than half of that is defense
spending and less than half of that is called nondefense discretionary
spending.
As it turns out, we could eliminate, I am told, every bit of our
nondefense discretionary spending, and we would still have a budget
deficit. That would be everything from agriculture to the environment,
to transportation, law enforcement, prisons, you name it; the whole kit
and caboodle, everything other than defense. I don't think we want to
get rid of all that. We might want to find more efficient ways to spend
that money. God knows we can find more efficient ways in spending
defense money.
One of the ways we can do that is to take a page from something that
happened today in the Committee on Homeland Security and Governmental
Affairs, and with our governmental affairs hat on, we had the leader of
the Government Accountability Office with us. We also had a couple of
inspectors general, and we had the head of the Census Bureau. They came
to talk with us and present to us something called the GAO--Government
Accountability Office--high-risk list. What is a high-risk list? It is
a list of programs that are in danger of wasting a lot of money. It
could include roughly $400 billion a year in revenues that we are
leaving on the table; owed but not collecting. It could be $300 billion
a year in major weapons systems cost overruns. It could be $110
billion, $115 billion a year on something called improper payments,
moneys that are paid wrongly, mistakenly--not fraud but just mistaken
payments--and it can include a lot of other things. It could be
properties that the Federal Government needs to get rid of, and we have
done good work on that. Senator Portman and I worked on that, as did
Senator Coburn when he was here, and we worked a lot on property
reforms. With the help of Senator Johnson last Congress, I think we
made pretty good progress.
There are a lot of ways we waste money. What we do in the Committee
on Homeland Security and Governmental Affairs, with our governmental
affairs hat on, is we use the GAO high-risk list as a to-do list to be
able to save money. If you have GAO, in concert with the Office of
Management and Budget, working together with the inspectors general in
every major Federal agency, working with the oversight committees in
the Senate, Homeland Security and Governmental Affairs, and with our
counterpart oversight committee in the House--if we all are working
together, going in the same direction, we can actually figure out how
to save a lot of money in defense spending and nondefense. With all the
overpayments that occur in Medicare and Medicaid--it is almost $100
billion just between those two--we could actually make some real
progress. Our budget deficit is still too large.
Not that many years ago, when Bill Clinton was President, the last 4
years of that administration, we had 4 years of balanced budgets. We
had not had a balanced budget since 1968. Over the last 4 years of the
Clinton administration, we had four balanced budgets in a row.
How did we do it? One, we had a good economy, as you all recall.
There were more jobs created in those 8 years than any 8 years in the
history of the country. I was Governor then, and there were more jobs
created in those 8 years in Delaware than any year in the history of
our State. I like to say I didn't create one of them, but we tried to
create a nurturing environment for job creation and job preservation.
One of those ways--one of the elements that is important--is certainty
and predictability.
It has been mentioned earlier today that the concern that a number of
people have with Congressman Mulvaney as OMB Director is he allegedly
has said government shutdowns are not that concerning. I don't know his
exact words. One of the things we were reminded of today by GAO is,
businesses need predictability, they need certainty, but the other
thing they need--what the Federal Government needs and its employees
need are some predictability and certainty as well. Stop-and-go
government is painful to businesses, but it is especially painful and
wasteful for the Federal Government. Continuing resolutions, government
shutdowns--our Federal employees spend a lot of time just preparing for
shutdowns. That is wasteful, it is demoralizing, and we can't do that.
I think that is--I will stop there. I see the majority leader is
here, and I want to be respectful to him. There are other concerns I
have that I will submit, but I hope my colleagues will keep these
thoughts and these concerns in mind when we consider the nomination of
Mr. Mulvaney to head up OMB.
I would say to my friend the majority leader, I appreciate the time
we had together in your office earlier this week. I would just ask him
to consider one more time, if we had the opportunity for a judge in
Oklahoma to make a decision tomorrow on the access to the emails we
discussed, I think we could all vote with a clear conscience a week
from Monday on the nomination of the Administrator for the EPA. I would
encourage the majority leader to do that.
Thank you very much.
The PRESIDING OFFICER. The majority leader.
Mr. McCONNELL. Mr. President, I thank my friend from Delaware for his
suggestion and giving me a moment here--I am not sure whether he is
finished--but to just ask unanimous consent on a matter.