[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.