[Congressional Record Volume 165, Number 109 (Thursday, June 27, 2019)]
[Senate]
[Pages S4614-S4616]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           FISCAL CHALLENGES

  Mr. ENZI. Mr. President, I thank the Senator from Ohio for his 
outstanding comments on faith-biased security and the immigration 
crisis that we are facing and the solutions he suggested. We have a lot 
of work to do there.
  Now you get to hear from the accountant.
  I come to the floor today to call attention to the Federal 
Government's unsustainable fiscal outlook.
  Yesterday in the Senate Budget Committee we had a hearing on fixing 
our broken budget and spending process, with a focus on securing our 
country's fiscal future. Our witness was the Comptroller General of the 
United States, the head of the Government Accountability Office.
  In April of this year, GAO issued its third annual update on the 
nation's fiscal health. The report concluded that the Federal 
Government is on an unsustainable fiscal path.
  A Congressional Budget Office report released this week on the long-
term budget outlook painted a similarly bleak picture, noting that our 
surging Federal debt is putting our Nation at risk of a ``fiscal 
crisis.'' This is one of the charts we got to see. I know it is pretty 
hard for people to read. We are figuring out a way to make this bigger.
  The impact will be tremendous. It shows that, in 2019, Social 
Security spending passed the $1 trillion mark annually. In 2021, the 
highway trust fund will be unable to meet all obligations. In 2022, the 
discretionary spending caps will expire, allowing unlimited spending. 
In 2025, the Pension Benefit Guaranty Corporation multiemployer fund 
will be depleted. It will be insufficient to pay full benefits to 
insolvent pension plans. In 2025, CBO projects the net interest 
spending will surpass the spending on national defense. In 2026, the 
Medicare hospital insurance trust fund will be depleted. With some 
incoming revenue, it will be sufficient to pay 91 percent of hospital-
related Medicare spending, which is already forced to be low.
  In 2030, the net interest spending will exceed $1 trillion annually. 
The interest will exceed $1 trillion annually.
  In 2031, mandatory spending and interest will consume all Federal 
revenue. It means we will not get to make any decisions on anything 
that isn't mandatory, which we don't get to make decisions on right 
now.
  In 2032, the Social Security trust fund will be depleted. The amount 
of money coming in that will be paid out right away will only pay 77 
percent of the scheduled benefits. I will cover that more later.
  Those are a few of the fiscal cliffs we are facing that could be 
solved now, that have to be solved now. If they are solved now, they 
have simpler, less impactful problems than if we wait until the cliff 
gets here.
  The Federal Government is swimming in a sea of red ink that threatens 
to drown America's future generations. If current laws don't change, 
debt as a percentage of GDP, will soar to unprecedented levels over the 
next 30 years. Let me repeat that. If current laws don't change, debt 
as a percentage of GDP--that is production--will soar to unprecedented 
levels over the next 30 years. By 2037, our debt-to-GDP ratio--that is 
debt-to-production--will surpass the historical records set in the 
aftermath of World War II. By 2049, debt will stand at 144 percent of 
GDP.

[[Page S4615]]

  That is how bond investors determine the likelihood of getting their 
money back. Interest rates reflect that fact and go up as risk 
increases. As that percentage goes up, the risk increases. The amount 
we have to pay to borrow any money will go up, if people still loan us 
money, which gets us to what is on the chart.
  In 2030, net interest will exceed $1 trillion a year annually. That 
is not buying anything; that is paying the interest.
  In most of the Nation's history, we have only seen periods of high 
spending and debt during wars and other emergencies, and the increase 
has been temporary, but today's fiscal situation is different.
  We are facing a demographic fiscal storm. For decades, nonpartisan 
experts, including the Congressional Budget Office and the Government 
Accountability Office, have warned of the budget pressures that we 
would face as baby boomers aged and began to retire. We heard yesterday 
from the GAO that, on average, more than 10,000 people per day turn 65 
years of age, and in the next few years, that number will rise to more 
than 11,000. Here is a little chart of how those thousands per day 
grow.
  Some of us were under the impression, of course, that the baby 
boomers eventually would die. That is kind of an inevitable sort of 
thing. What we didn't count on was the extra longevity that everybody 
will have and the fact that there are other generations coming up. So 
the chart does not tail off here on the end. The chart continues to 
grow, even though the birth rate is down.
  The combination of aging population, longer lifespans, and rising 
per-beneficiary healthcare costs put enormous pressure on our spending.
  According to the CBO, the projected explosion in debt we will see 
over the next few decades and beyond occurs because of mandatory 
spending--particularly Social Security and major healthcare programs, 
specifically, Medicare and Medicaid--not to mention the interest 
payments on the national debt that will permanently grow faster than 
Federal revenues.
  This autospent money--spending that is never looked at--has already 
grown from about 36 percent of the Federal budget 50 years ago to 70 
percent today. If left unchecked, CBO projects that more than 80 cents 
of every dollar the government spends will be on mandatory spending, 
guaranteed to be spent without further approval, not to mention the 
interest by 2049.
  Because mandatory spending operates on autopilot, not subject to the 
annual appropriations process, it often escapes congressional scrutiny 
and proper oversight. It would be one thing if mandatory spending 
programs bypassed the appropriations process because they were fully 
funded through their own dedicated source of revenue, but that is not 
the case.
  As this chart shows, many of the largest mandatory programs, such as 
Medicaid and food stamps, don't have their own source of funding and 
instead rely entirely on money from the Treasury's general fund. You 
can see the blue here. That is money that will be coming in. The red is 
the extra money that has to be spent to meet the obligations. On some 
of these, you will note that there is no blue at all. That means this 
is coming out of the general fund, which is where we expect to be able 
to get defense, education, and all of the other things we do. So there 
is enough spent right here on excess that doesn't have a source of 
revenue that forces everything else we do to be borrowed, and I already 
mentioned the problems of borrowing.
  Even though some of these programs do collect some revenue--and a few 
of them do collect their own revenue--they often spend more than they 
take in. It didn't used to be the case. We used to have a lot more 
people working and paying into Social Security than were receiving 
Social Security, and there used to be a huge surplus, which we spent 
and then put as bonds in the drawer. We are now drawing down on those 
bonds, even though there is no real money to back them up, but that is 
about to be depleted as well.
  Over the next 10 years, CBO projects that Social Security spending 
will total $14.4 trillion, but the program's dedicated tax revenues 
will only cover $11.8 trillion of that. That is $14.4 trillion going 
out and $11.8 trillion coming in. You can't do that very long.
  CBO projects that under current law, Social Security's combined trust 
funds would be exhausted through 2032. You may say: That is a long time 
into the future, 2032. Well, that is 3 years earlier than the Social 
Security trustees estimated just earlier this year. How many times can 
we have that accelerated by 3 years before we are at the cliff?
  Total Medicare spending will amount to $11.5 trillion over the next 
10 years, but the program just collects $6 trillion in dedicated taxes 
and premiums--again, $11.5 trillion going out and $6 trillion coming 
in.
  CBO and the Medicare trustees both projected Medicare's Hospital 
Insurance Trust Fund, which covers inpatient hospital services, hospice 
care, skilled nursing facilities, and home health services, will be 
depleted in 2026.
  Spending on military and civilian retirement programs will total 
nearly $2 trillion, but Federal employees' contributions toward their 
pension will only be $70 billion. I don't like that word ``trillion.'' 
It is kind of hard to wrap your head around it. Billions are tough 
enough, but $2 trillion is $2,000 billion. That is what is going out, 
$2,000 billion. What is coming in is $70 billion. There is a little bit 
of a gap. Just as with most other spending programs, this difference 
will be made up with general fund revenues, which today are all 
borrowed funds.
  Social Security and much of Medicare is supposed to be different 
though. Under current law, once their respective trust funds are 
exhausted, those programs will still pay out money, but they will only 
be able to pay out as much in benefits as they have coming in. We heard 
yesterday from the Government Accountability Office that, for Medicare, 
that means only being able to pay 91 cents on the dollar for hospital-
related Medicare spending. How long do you think doctors will put up 
with that? How many hospitals will that put out of business? For Social 
Security, revenue is projected to be sufficient to cover only 77 
percent of scheduled benefits. Who on Social Security will be able to 
afford a cut of 23 percent? That is the fiscal cliff.

  Of course, this shouldn't be news to lawmakers. For years, the 
warnings that these programs are on an unsustainable fiscal course have 
gone largely unheeded, hoping that the next Congress, the next 
President, or maybe the next generation would be more willing to deal 
with the problem.
  To be clear, I want to make sure Social Security and Medicare are 
able to continue providing benefits to current beneficiaries, as well 
as those who may need these programs in the future. That will require 
us to work together in a bipartisan manner to ensure these programs' 
solvency. If we don't make changes to the way these programs currently 
operate, a lot of people in the future will just be out of luck. There 
are levers that can be pulled on these. If any one is pulled, it would 
be a tragedy to whomever it affects. If they are all pulled, it is less 
noticeable but still noticeable based on how long it is before we ever 
reach a solution on these problems.
  Ignoring the problem will not make it go away and, in this case, the 
opposite is true. The longer we wait to address this imbalance, the 
more severe the changes will need to be, and we will have fewer 
options.
  We need to change the way we do things around here. Too often we wait 
to make the difficult decisions that everyone knows has to be made 
until we have a crisis on our hands. In the Budget Committee, we are 
focused on trying to put together bipartisan budget process reform 
proposals that will help us confront these thorny fiscal issues in a 
more reasoned, timely, and responsible way.
  I am hopeful we will get there. I am encouraged with the 
conversations we have had that we will get there. These issues are too 
important to ignore, and we are going to need to work together if we 
are to put our country on a more sustainable fiscal course. We owe it 
to future generations to try.
  We have handled some crises around here. Recently, we handled one of 
national disasters. The national disasters don't have to be paid for. 
They aren't a part of the budget caps--they should be a part of the 
budget caps, but they don't have to be a part of the budget

[[Page S4616]]

caps--so they just get exempt as long as they are voted on, but 
everybody wants to help everybody with a problem, so we go ahead and 
pass those straight to debt. One week, at the beginning of the week, 
when we proposed it, it was $13 billion. When it actually passed it, it 
was up to $19.1 billion. That all went to additional debt.
  It is a crisis. We need to plan for it. We need to prioritize for it. 
We need to fit that in, but we can't do everything, continue to 
escalate everything, and consider that things we haven't look at for 
years are OK to keep doing the same way we are doing them or to have 
the duplication. We are doing hearings all the time on ways this 
problem can be solved, but it is important that we start solving it 
soon or future generations will be drastically affected.
  In fact, the dates I had up here earlier, present generations will be 
affected. We need to get everyone on board looking for solutions and 
biting the bullet now to do them.
  I have had a penny plan for a long time. Under the penny plan, if we 
just stopped spending 1 cent out of every dollar we spend, not counting 
Social Security, no change in Social Security--if we just found ways to 
do things 1 percent better, and we did that for 7 consecutive years, 
our budget would balance. If we started with a penny, I am pretty sure 
we would say: That really didn't hurt too bad. How about if we do 2 
cents? Now we cut it back to 4 years, and we can start paying down 
debt, which we have to do for our future generations, if our kids and 
grandkids are going to have the kind of life we had.
  I am working for and hoping for everybody working together to solve 
these problems. If we just talk about them, and we don't work on them, 
it is pretty depressing but not as depressing as it will be hurting.
  I ask my colleagues to take a look at this and help come up with 
solutions. I am impressed with those who are working with me on it.
  I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BRAUN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Enzi). Without objection, it is so 
ordered.
  Mr. BRAUN. Mr. President, I sit here every Thursday from 3 o'clock to 
6 o'clock and hear several speeches that are made. I happen to sit on 
the Budget Committee with Chairman Enzi. I hope everyone listened 
carefully to what he just said. The Comptroller General was in 
yesterday.
  One of the reasons I ran for Senate is that being a Main Street 
entrepreneur from Indiana, you never could have gotten by with the way 
this place runs its business. The Federal Government is somewhere 
around six to seven times the size of Walmart and runs its business by 
the seat of its pants, in the sense that we have not done a budget that 
we have appropriated in nearly 20 years.
  If you listened closely, you know we have some hard deadlines. The 
chairman referred to it as cliffs. Well, sometimes that is so 
figurative that you don't believe it is going to happen or that it is 
going to be real. These are things we are going to have to contend 
with.
  When the Medicare fund is depleted fully in 2026, benefits get cut 
immediately. Social Security is farther down the trail, and there are 
going to be all kinds of issues. We are lucky, currently, that other 
countries and our own citizens will lend us money when we run trillion-
dollar deficits routinely.
  He mentioned the ``Penny Plan.'' In any business, if you were charged 
with fixing your company's problems by cutting back by either freezing 
expenses by a 1-percent cut or a 2-percent cut, that would be done 
easily because you have hard accountability. If you would perform in a 
business or a State government like we do here, I can guarantee you 
there wouldn't be a lender that would let you perpetuate and keep doing 
it. The fact that we have a credit card that we can put it on year 
after year eliminates the accountability that you have anywhere else.
  I was on a school board for 10 years. I was in State government in 
Indiana, where we always have a cash balance and operate in the black 
and have a balanced budget. Even though we do that so routinely there, 
we passed a balanced budget amendment to our State constitution simply 
because government, even in a place like Indiana, oftentimes views how 
they spend the people's money different, and this place does it worse 
than any other place in the country.
  So do we want to get to the point where we deplete the Medicare trust 
fund and where we run out of funds to pay pensioners or do we want to 
make the hard decisions?
  It is funny. When I got here, I looked at the budget process. 
Budgets, even though they are not adhered to, might be a resolution, 
and it is not the law. Always, even if they do incorporate savings, you 
never see it until year 6, 7, 8, 9, and 10. Well, again, in the real 
world, if you are running at a 20-percent loss on your P&L, you do not 
have the luxury to wait 6, 7, 8, 9, or 10 years to fix it.
  I ask the American public to hold their Senators accountable and 
their congressmen, because this time, unlike in 2008, which we all know 
was bad enough, the main people holding the bag will be retirees and 
the elderly who depend on the government for healthcare, and 
individuals who depend on healthcare who are not well to do, through 
Medicaid, will be left holding the bag.
  Only 22 Republicans--it should have been all 53 of us who were on the 
Penny Plan bill that Senator Paul put out just a few weeks ago, but 
only 22 of our own conference, which talks about fiscal conservatism--
got on that bill. I would hope that the American public holds their 
representatives accountable so that we don't hit the cliff and go over 
it and pay the consequences, which will be dear.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Kansas.
  Mr. MORAN. Mr. President, I ask unanimous consent to complete my 
remarks while seated.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________