[Congressional Record (Bound Edition), Volume 145 (1999), Part 19]
[Senate]
[Pages 26742-26746]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 26742]]

                            SOCIAL SECURITY

  Mr. THOMPSON. Mr. President, I want to address the subject of Social 
Security, as my colleague from New Hampshire has so eloquently 
addressed a few minutes ago. It is a matter about which we are all 
concerned. We all agree that something is going to have to be done 
about it because the numbers simply don't work. We all know that the 
money needed to pay to more and more retirees is not going to be 
sufficient because we are not going to have a sufficient number of 
people paying into the trust fund. We are going to have more and more 
retirees and fewer and fewer workers in the future. The numbers simply 
are not going to add up.
  We all recognize that a day of reckoning is coming, and many of us 
have been struggling to try to decide what to do about it. It seems as 
if there are really only three choices.
  One is to raise taxes. We pay for Social Security with Social 
Security taxes, FICA taxes. We could raise them astronomically on 
future workers.
  The second is to cut benefits, which, of course, nobody wants to do.
  The third choice is to have some kind of fundamental restructuring 
and reform. I think more and more people have concluded that is what 
has to happen.
  A lot of people, including myself, think we have to have some system 
whereby the worker can invest some of that money in those FICA taxes 
for something that will have a much greater return than they are 
getting today.
  We were hoping that before the President left office, there would be 
some leadership from the President in making some of the hard choices 
we all know are going to have to be made. Any one of those choices I 
have just described is not an easy political choice to make. It will 
never be made unless we get some leadership from the President, at 
which point I think a lot of people will fall in line.
  We have, on a bipartisan basis in the Senate, already been trying to 
work toward that end. Frankly, I don't think the political risks are as 
great as a lot of people think. I think we should tell the people the 
truth and do something, go ahead and do it. There is not a lot of risk 
to that. Most people believe otherwise. But we will have to have 
Presidential leadership under any circumstances.
  The President has come forth with a plan which does not really do 
those three things I mentioned before in terms of the alternatives, but 
he seeks to basically put the problem off to another day. It is a good 
strategy in a year before an election because it avoids the problem 
while pretending to solve it. But it certainly doesn't do anything to 
solve it.
  I think we can reach agreement on that with a pretty wide consensus 
on a bipartisan basis in this body because too many Democrats and 
Republicans have been working together and concluding that the approach 
that has recently been suggested by the President is something that 
just won't work.
  Here is the basic situation. Right now, mandatory spending programs 
such as Social Security and Medicare consume two-thirds of our Federal 
budget. In 1980, it was 53 percent; 1990, 63 percent; today, 66.5 
percent. By 2030, if no changes are made, mandatory spending, including 
Social Security and Medicare, will eat up 100 percent of Federal 
revenue.
  We know we cannot go down that route forever. At the same time, we 
are facing a demographic time bomb that will place unprecedented new 
burdens on the Federal budget. The number of Americans over the age of 
65 will more than double between now and 2030. Also, during the same 
period, the working age of Americans will only increase by 25 percent. 
This means there will be fewer people paying into the system to support 
many more beneficiaries. Most everyone, myself included, argues that 
more people living longer is not a bad problem to have. But it will 
place tremendous strain on the Social Security Program and on our 
Federal budget, neither of which is particularly well equipped to deal 
with it.
  I cannot agree with the President when he said in his radio address 
that his proposal to transfer general revenue credits--getting away 
from the FICA self-financing system that we have now, but dipping into 
general revenue credits, coming in from income taxes because we have a 
surplus now, that to transfer these credits into the Social Security 
trust fund is ``the first big step toward truly saving Social 
Security.''
  Let me first point out the general revenues the President wants to 
transfer to Social Security come from the very same projected budget 
surplus he said we could not count on for tax cuts. Now he is using 
those same uncertain surpluses to so-called save Social Security. The 
President cannot have it both ways.
  I will quote from testimony of David Walker, Comptroller General, 
testifying before the Finance Committee in February. The Senator from 
New Hampshire quoted Mr. Walker saying ``this does not represent a 
Social Security reform plan.'' I will not quote all of his statement at 
this point, but an additional statement he made was that ``the changes 
to the Social Security Program will thus be more perceived than real,'' 
talking essentially the same as the President's plan. Although the 
trust funds will appear to have more resources as a result of the 
proposal, in reality nothing about this program is changed. He 
concluded that the proposal does not present Social Security reform 
but, rather, it represents a different means to finance the current 
program.
  It is not Social Security reform and will not save Social Security. 
One of the risks of the proposal is that the additional years of 
financing may very well diminish the urgency to achieve meaningful 
changes in the program. That would not be in the overall best interests 
of the Nation. In other words, whether it is designed to have the 
effect of convincing people we are doing something that we are not, 
that we don't have to address the problem for a while, when, in fact, 
we are not taken care of, thereby makes the problem worse when we 
finally do get around to instituting some responsible reforms.
  I don't know if I can say it any better than the Comptroller. What 
the President is proposing is to add more debt to the Social Security 
trust fund, more paper IOUs that one day will have to be redeemed. What 
is different about these paper IOUs is that they do not represent 
excess FICA taxes--money collected for the specific purpose of 
financing the Social Security Program. For the first time, the 
President is proposing to inject general revenue dollars into the trust 
fund, based on a calculation of interest savings we will realize as a 
result of paying down the debt.
  There are several problems with this. One, as the Comptroller General 
pointed out, adding more IOUs to the trust fund may give the impression 
on paper of extended solvency but it does not change by one minute the 
day on which the cash-flow problem comes home to roost; that is, the 
day on which payroll taxes will not be sufficient to cover benefit 
payments and we will have to begin redeeming the IOUs in the trust 
fund.
  In the absence of real reform, as I said, there are only three ways 
to redeem the IOUs. Rather than taking steps to reduce the program's 
unfunded liability, the President's proposal makes us more reliant on 
the unhappy choices of raising taxes or cutting benefits. Rather than 
acknowledging that we will have to either raise payroll taxes, adjust 
benefits, or find a way to enable people to earn a higher return on 
FICA taxes, the President makes the program more dependent on future 
infusions of general revenues from the Treasury--income taxes from 
young workers that will come into the system later on. That will only 
exacerbate the trend I discussed earlier in which an ever-increasing 
portion of the overall Federal budget is being dedicated to entitlement 
programs for the elderly.
  Everyone believes Social Security is a vitally important program, and 
everyone is committed to making sure

[[Page 26743]]

that it is there for current seniors and future generations to rely 
upon. I am not sure we are all committed to the proposition that 100 
percent of the Federal budget should be dedicated to Social Security 
and Medicare. In fact, I am pretty sure most believe the Federal 
Government has other responsibilities as well, such as national 
defense, national parks, infrastructure, and schools. That is the 
direction in which we are headed and the President's proposal gets us 
there more quickly.
  The second problem with transferring general revenues into the Social 
Security trust fund, as David Walker pointed out, is that will, in all 
likelihood, diminish the momentum for real reform. If we continue to 
avoid real reform, we only have to look at countries in western Europe 
to catch the glimpse of the problems we face: Pension benefits that are 
on average 1\1/2\ to 2 times as generous as our Social Security; 
astronomical payroll taxes to fund the benefits; 40 percent in France; 
42 percent in Germany; 39 percent in Italy, on top of other taxes 
imposed by the government, and an average unemployment rate across 
European Union countries that will be double that of the United States 
this year, 9.1 versus 4.3.
  According to a recent series in the Washington Post, it simply costs 
companies too much to create jobs in Europe. In Germany, the textile 
industry, for example, payroll taxes and fringe benefits add 70 percent 
to the average salary. These countries have promised more than they can 
afford, just as we have.
  We need to have a debate about structural reform of our Social 
Security Program. It needs to be a bipartisan debate. We need to have 
real options on the table, not gimmicks designed to give one party 
political advantage over the other. I hope the President will agree to 
work toward that goal, but until he does I hope we do not fall into the 
trap of instituting something that makes the situation worse. That is 
what this proposal will do.
  I yield the floor.
  Mr. KERREY. Mr. President, let me thank President Clinton for 
provoking debate about Social Security and what we ought to be doing to 
extend the solvency of the program. I don't support the proposal he has 
made, but I suspect there are many people in this body who don't 
support the proposal that I have made either. At least the President 
has put on the table an idea, and it is an idea that enables us, if we 
take a bit of time, to see what is wrong with the funding of this 
program and why there is an urgent need to fix it.
  First, what the President does is exactly what I just heard the 
Senator from Tennessee say; what the President would do through his 
proposal is give beneficiaries who are alive between 2035 and 2050--
beneficiaries who are, today, between the ages of 30 and 45--an 
additional $20 trillion claim on the income taxes of future working 
Americans. That is how the President's proposal would be funded.
  Under current law, we will need $6 trillion worth of income taxes to 
pay beneficiaries between 2014 and 2034--this is above and beyond the 
revenue beneficiaries can claim from the 12.4% payroll tax on all 
working Americans. Today, there are 44 million beneficiaries: 39 
million are old-age beneficiaries, 6.5 million are disabled, and 7 
million are survivors. These beneficiaries receive the proceeds of a 
12.4-percent payroll tax on the wages of most working Americans.
  I suspect most Members of Congress didn't realize that back in 1983 
we made a change in the law to assess a payroll tax that was larger 
than needed to pay the bills. Since then, those extra payroll tax 
dollars have been spent on other things. Between 2014 and 2034, we will 
have to pay back those borrowed Social Security payroll tax dollars 
with interest--and we will do so by either increasing income taxes, 
cutting other spending, or increasing our national debt. This year, for 
example, we will take in about $513 billion in revenue into the 
program--but we only need about $387 billion to cover expenditures. My 
guess is most Members of Congress didn't realize that the Treasury can 
only use these excess payroll tax dollars to buy special-issue Treasury 
bonds. Eventually, the Treasury has to reconvert those bond assets to 
cash--and it does so by using income tax dollars. Starting in 2014, 
Treasury will have to use income taxes and corporate income taxes to 
convert each and every single one of those bonds into cash that they 
will then use to pay beneficiaries--about $6 trillion worth.
  If that does not bother you that we have to use an additional $6 
trillion to pay benefits between 2014 and 2034--money that could have 
been spent on important discretionary spending programs, then you 
probably like the President's proposal. If you want the Social Security 
program to become more and more a program that uses both payroll taxes 
in addition to individual and corporate income taxes, you probably like 
the President's proposal. The President's proposal allows you to avoid 
making the difficult choices necessary in reforming Social Security, 
such as either explicitly raising the payroll tax--and I haven't heard 
anybody actually support that, although some have supported increasing 
the wage base--or making benefit adjustments out in the future; or a 
third way, which the Senator from Tennessee and I and half a dozen 
others in this body have chosen to do, is to use a combination of 
benefit adjustments out in the future, holding harmless everybody 
currently over the age of 62, and establishing retirement savings 
accounts--designed in a progressive way. Our plan ensures that women 
and low income individuals will receive significantly larger benefits. 
That is the purpose of these savings accounts--to help all working 
Americans build wealth for themselves. Privatization is just an attempt 
to give, especially that lower-wage individual, more than just the 
promise of a transfer payment coming from Social Security taxes. Our 
goal is to make individuals less dependent on the government for their 
financial security at retirement.
  One of the most difficult and important things to understand in the 
Social Security debate is this idea of solvency. Solvency is an 
accountant's term. There are 270 million Americans today--nearly all of 
whom will be beneficiaries of the Social Security program at some point 
during their lifetimes. More than 44 million are eligible today. That 
means there are 230 million beneficiaries who will be eligible at some 
point in the future. That is the way to think about solvency--we have 
to make the program solvent for all retirees current and future. The 
idea is to keep the promise for every eventual beneficiary, whether you 
are 20 years old or 70 years old. Right now we cannot keep the promise 
to all 270 million Americans. There are approximately 145 million 
working Americans under the age of 45 to whom we cannot keep the 
promise of paying benefits. According to the Social Security 
Administration, these 145 million Americans will experience somewhere 
between a 25- and a 33-percent cut in benefits at some point during 
their retirement.
  So when we talk about solvency, it is a real human issue. There are 
145 million Americans today to whom we are not going to be able to keep 
the promise we made back in the 1930s. That is why a large percentage 
of young people say they don't believe Social Security will be there. 
They are partly right--Social Security will be there, but in a much 
smaller form as a consequence of Congress simply not having enough 
revenue in the system to be able to cover the bills.
  What the President says is that he doesn't want to propose a payroll 
tax increase, or benefit reductions. He doesn't want to support the 
idea of individual wealth accounts. What he wants to do is give the 
Social Security beneficiaries out in the future a larger claim than 
they would have under current law on income taxes--on the wages of 
future working Americans.
  I believe we made a mistake in 1983; that diverting $6 trillion of 
individual and corporate income taxes into the Social Security program 
makes our tight discretionary budget problem even worse. The 
President's plan exacerbates this problem by saying what we should give 
an additional $20 trillion in income tax dollars to extend the solvency 
of the trust for another 20 years.

[[Page 26744]]

  I will reiterate what I said at the beginning. I still appreciate the 
President's contribution to the debate. He has provoked, for a short 
period of time at least, a real debate about what we are going to do to 
solve the problem of Social Security insolvency. I disagree with one 
element of his proposal because I think it takes a necessity and 
converts it into a virtue. I do hope, at least for a short period of 
time, we will discuss and debate Social Security reform. I hope we can 
discuss in a constructive fashion, what we are going to do to reform 
the program--rather than just talk about needing to fix Social 
Security. We need to discuss what we are going to do to finally change 
the law to keep the promise to all 270 million American beneficiaries.
  The PRESIDING OFFICER (Mr. Crapo). The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I ask consent I be permitted to speak 
for up to 10 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. DOMENICI. Mr. President, I did not come to the floor to speak 
exclusively on the issue of Social Security and the President's 
proposal. But before my good friend from Nebraska leaves, I wish to 
make a couple of comments. Then I would like to share with the Senate 
some very optimistic information with reference to our fiscal house and 
how well we are doing in terms of growth of government.
  I suggest Republicans did a good job when they came up with the idea 
of locking up these Social Security trust funds so they wouldn't be 
spent. Frankly, even as short a time ago as last year, nobody thought 
we could quickly come upon a year when we would not spend a bit of the 
Social Security trust fund money in paying for our Government and would 
even have some left over to start a pay-down of Social Security. But in 
the year just passed, that actually happened. Things changed so much 
for the positive that last year we did not touch Social Security trust 
fund money and we accumulated $1 billion in surplus on budget, and it 
has nowhere to go except to pay down the debt--which helps with Social 
Security.
  Frankly, I do not quite understand why, in the waning moments of this 
year, over the weekend in his weekly radio address, the President came 
up with a new idea about Social Security. I speculate maybe the idea of 
the lockbox and not spending any Social Security money was beginning to 
take hold and, of course, his new proposal takes 15 years, not 10 
years, to get his job done that he perceives to be in the interests of 
Social Security solvency.
  I remind everyone, if in fact the President has a way, with no new 
taxes, which none of us want, no benefit changes, no increases in what 
each particular citizen of the United States who puts money through the 
payroll account--they don't have any share of the profits and the 
increases that come, either from Wall Street or from investing in 
debt--somehow the Wizard of Oz came upon us and all of a sudden we can 
do this by just investing IOUs. As my friend from Texas said, you just 
take them as a piece of paper, walk them across the street, put them in 
a cabinet, and say: We have given them to the Social Security trust 
fund.
  The President has one better. At a point in time way out there 
somewhere he is going to say: That is not the only thing I am doing. I 
am going to credit the Social Security account for the interest that 
was saved on the national debt by us putting those IOUs in that box.
  Over the weekend I had a chance to discuss this. I look forward to 
seeing some details. I cannot believe what I am hearing. But I 
nicknamed this proposal and I think it is so. I think it is the 
``Godzilla'' of all gimmicks. That is the way I would classify it, for 
those who are wondering about gimmicks.
  I am not going to talk much more about that. But I will say to the 
President, if you have a little time left before you leave, and if you 
would like to fix Social Security, then engage in a bipartisan way, 
with Senators on both sides of the aisle, who would like to do 
something that would help make Social Security a better investment for 
the millions of Americans who are having this money taken out of their 
payroll and put in an account that yields them little or nothing.
  If you had sitting in front of you a group of 22-year-olds, 25-year-
olds, just starting out their work years in the American marketplace, 
and you said to them: For all of you, what is one of the worst 
investments you could make, in terms of putting money away until you 
are 65 and then drawing on it? anybody looking at it would have to say 
it is the Social Security system.
  It is one of the worst investments you could make because you do not 
get anything on your investment. Sooner or later, somebody is going to 
come into the Presidency--if this President would like to do it, he 
ought to change his mind again and come to the party--and say we have 
to make that a better investment. By making a better investment, you 
enhance the value of the trust fund and thus make it more solvent over 
time.
  Republicans invented the Social Security lockbox; Democratic Senators 
oppose it. Republicans support locking away every penny of the Social 
Security surplus--we have made that clear repeatedly to the President. 
In fact, we came up with the idea of the Social Security lockbox and 
have tried to pass legislation in the Senate on at least five 
occasions. This lockbox would stop the President and Congress from 
spending any of the Social Security surplus. Unfortunately, Democratic 
Senators have filibustered the lockbox.
  The President wants to spend Social Security Surpluses. Congress has 
nearly completed action on all 13 appropriations bills, and we will do 
it without touching Social Security. But the President and his staff 
are demanding that we spend more on scores of government programs, 
including foreign aid, but they have yet to provide any credible 
proposals as offsets. Republicans and many Democrats have made it clear 
that we will not raise taxes to support the President's spending 
programs. If the President persists in demanding new spending without 
specifying a credible offset, I can only conclude that he wants to tap 
Social Security for his programs.
  The President's proposal for Social Security solvency is the 
``Godzilla'' of gimmicks. The President proposes no changes whatsoever 
in the structure of Social Security, and yet he wants the American 
people to believe he has made ``tough choices'' to save the program. It 
is simply not credible. In fact, for all the talk about gimmicks, it 
seems to me that this is the ``Godzilla' of gimmicks--a $34 trillion 
gimmick. The President's plan is nothing more than paper transfers from 
the general fund of government to Social Security, amounting to a 
cumulative $34 trillion in new IOUs in Social Security between now and 
2050. At some point, when Social Security needs those IOUs to pay 
benefits, a future President and a future Congress will have to raise 
taxes to meet those obligations. So, in effect, this proposal is a $34 
trillion tax increase on America's future.
  There is bipartisan opposition to this gimmick in the Senate, 
including Senators Breaux, Kerrey, and Robb, all of whom are on the 
Finance Committee with jurisdiction over Social Security.
  Let me read some quotes from the experts:
  David Walker, Comptroller General GAO, in testimony before Senate 
Budget Committee, February 1999:

       [President Clinton's Social Security proposal] does not 
     come close to ``saving Social Security''.
       Under the President's proposal, the changes to the Social 
     Security program will be more perceived than real: although 
     the trust funds will appear to have more resources as a 
     result of the proposal, nothing about the program has 
     changed.

  Federal Reserve Chairman Alan Greenspan, in Q&A before Senate Banking 
Committee, July 1999, when asked if he supported using general revenues 
to shore up Social Security--which is the basis of the President's SS 
IOU scheme--the Chairman said this:

       I would very much prefer that we did not move in the 
     direction of general revenues because in effect, once you do 
     that, then you've opened up the system completely and the 
     issue of what SS taxes are becomes utterly irrelevant. And 
     I'm not terribly certain that serves our budgetary processes 
     in a manner which I think is appropriate.


[[Page 26745]]


  Federal Reserve Board Member Edward Gramlich and Chairman of the 
1994-1995 Social Security Advisory Council, in testimony before Senate 
Finance Committee, February 1999:

       During the deliberations of the 1994-1996 Social Security 
     Advisory Commission, we considered whether general revenues 
     should be used to help shore up the Social Security program. 
     This idea was unanimously rejected for a number of reasons . 
     . . there are serious drawbacks to relaxing SS' long-run 
     budget constraint through general revenue transfers.

  The Concord Coalition, in a press release, September 27, 1999:

       . . . we do not agree that [the President's] plan to credit 
     Social Security with new Treasury IOUs representing interest 
     savings from presumed debt reduction does anything to save 
     the program . . . All it does is simply paper over Social 
     Security's looming shortfalls.

  Gene Steuerle, senior fellow, Urban Institute, in testimony before 
Senate Finance Committee, February 1999:

       My own assessment is an additional transfer from the 
     government's left hand (Treasury) to its right hand (Social 
     Security) . . . tends to mask too much. The simple fact is 
     that future taxpayers must cover the cost of the interest and 
     principal on any gift of bonds from Treasury to Social 
     Security.

  The President could have had a legacy if he had shown leadership. The 
President spent most of 1998 telling the country he would show true 
leadership on Social Security. If he had proposed real reform, many in 
Congress were ready to work with him. Unfortunately, he chose this non-
reform, dooming his chances of any real legacy in Social Security.
  Mr. GRAMM. Will the Senator entertain a question or two about Social 
Security?
  Mr. DOMENICI. Absolutely. Surely.
  Mr. GRAMM. We are, obviously, all aware Senator Domenici has been 
chairman of the Budget Committee longer than anyone has ever been, or 
ever will be again, under our new rules. We know he, of all people, 
knows how the budget works.
  If you wanted to write a proposal and implement it in the future, 
after its potential impact on anything we are doing now would be zero, 
given our budget rules about things that affect taxes and entitlements, 
when would you let it go into effect?
  Mr. DOMENICI. You have to tell me.
  Mr. GRAMM. I will tell you. Under our current rules, we budget on 
entitlement and taxes for 10 years; right?
  Mr. DOMENICI. That is correct.
  Mr. GRAMM. So that anything we do today that has any effect prior to 
2011 has an impact on our current budget.
  Mr. DOMENICI. That is correct.
  Mr. GRAMM. When do you think the President starts this godzilla of 
all phony proposals?
  Mr. DOMENICI. 2015.
  Mr. GRAMM. Exactly. Actually, he begins on 2011 and then changes the 
formula on 2015. The first point is that one indication it is phony is 
that he does not start it until enough time has elapsed that it will 
have no impact on anything we are doing now.
  Mr. DOMENICI. The reason I did not understand the Senator's question 
is that sometimes we use 5 years. The President came along early this 
year for the first time in history and used 15 years. Thus, we said 15 
is too long; let's do 10. But I am not sure where we are going to be on 
a permanent basis because we are looking at this to see what makes 
sense. I think what the Senator just said is absolutely right.
  Mr. GRAMM. Let me pose another question. I have a memorandum from the 
chief actuary at the Social Security Administration which analyzes the 
President's proposal. I will read one part of a paragraph that analyzes 
the point the Senator from New Mexico outlined, and that is, the 
President is saying that in the future, long after it could have any 
impact on the amount of money we are spending now, we should pay the 
Social Security Administration for the interest savings we are accruing 
in the budget from using Social Security surpluses to pay down the 
debt.
  When the Social Security Administration in their memorandum of 
October 23 analyzed that, they concluded the following:

       Calculation of the assets in the combined trust funds on 
     September 30 of the year 2011 through 2015 would treat all 
     amounts transferred as if--

  ``As if''--

     they had been invested in special obligations of the United 
     States. This provision is not likely to have any effect under 
     enactment of this bill alone because the managing trustee of 
     the Social Security trust funds is not authorized to invest 
     any asset of the fund in stock, corporate bonds under either 
     current law or this proposal.

  Mr. DOMENICI. Right.
  Mr. GRAMM. In essence, the Social Security Administration says the 
proposal acts as if there is a transfer that can be invested, but since 
it cannot be invested, what you are doing is simply giving Social 
Security more meaningless IOUs, and the net result is no impact on 
anything.
  When the President said in his State of the Union Address now 3 years 
ago, ``Save Social Security first,'' we never heard a program as to how 
we were going to save it. When he said last year, ``Save it now,'' we 
had all of these meetings and all of these proposals, and the President 
ultimately proposed nothing.
  Now what we are seeing, sadly, is another gimmick where we do not do 
anything until the year 2011, and then it is simply a meaningless IOU 
where the Government owes Social Security but no money is available to 
pay for it other than if we raise taxes or cut Social Security benefits 
or cut another program in the future.
  I thank the Senator for yielding. If there has ever been a fraudulent 
proposal, this is it. The tragedy is, the President had an opportunity 
to lead on this. There were Democrats and Republicans willing to follow 
him, and he did not do it.
  Mr. DOMENICI. I thank the Senator.
  I want to take a few minutes and look at this simple chart. We have 
been engaged for many years--in this Senator's case, 26 years--in 
talking about getting the expenditures of our Government down so we do 
not continue to incur huge deficits that force our children in the 
future to pay for our bills. We got to the point where that was 
something being spread across this land and everybody understood it. 
They said: Let's stop spending more than we take in.
  Have we succeeded? Are we really doing something about how big 
Government was growing, and have we taken it by the horns and said we 
are going to do something about it or not?
  This is a simple bar graph which shows in 1970-1975, the combined 
growth in Government for all of the entitlements--military and 
discretionary spending--was almost 11 percent. In 1975-1980, it was up 
even from that. It grew 12.2 percent. From 1980-1985, looking at this 
chart that has it in detail, all spending grew at 10 percent. From 
1985-1990, all spending grew at 5.8 percent. It kept coming down.
  Guess what it is for the last 5 years, I say to my friend from 
Tennessee. The combined growth of Government--entitlements, domestic 
and military--is now down to an annual spending of 2.8 percent, and 
that is made up of defense spending at 1 percent growth and nondefense 
discretionary at 1.4 percent annually.
  I know we get into arguments on the floor and those who are worried 
about spending try to outdo each other as to how much we are going to 
save and make arguments of every single proposal that comes along in 
terms of cutting more--let's take some out of this program. All of 
those are good ideas. We are governed by a majority, so eventually 
whatever ideas you have, you have to get at least 51 votes.
  Success in terms of getting Government down in size so we can live 
with it and do not have to incur significant deficits every year has 
occurred most significantly in the last 5 years. I remind everyone, 
throughout all these other years, we have had either a Republican 
President and both Houses Democrat, a Democrat President with both 
Houses Democrat, or a Republican President with one House Republican. 
And guess which combination has been most effective in getting spending 
down. It is when the Congress has Republicans in the House and Senate.
  For 5\1/2\ years, we have had the lowest growth in Government at 
every level since 1970. It is pretty revealing. I

[[Page 26746]]

share with anybody who wants to go through it--and we can talk more 
about how it has happened--but when people think the Congress did not 
do much, we were not big players in getting us a balanced budget, I 
submit this is a pretty big part of it. If those went back up to the 
levels that were here 15, 20 years ago, we would sure be looking around 
wondering, are we ever going to stop spending Social Security money to 
pay for the expenses of our ordinary Government?
  I thank the Chair and yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. DODD. I thank the Chair.
  Mr. President, I am going to address the Senate on the issue of the 
Caribbean Basin Initiative and the related parts of that package. But I 
appreciated being in the Chamber for these last few minutes to hear 
some of the discussion on Social Security and budgetary items.
  I say with regard to Social Security--and I do not sit on a major 
committee dealing with the Social Security issue--all I know is, in the 
last few weeks, the Congressional Budget Office reported that while 
there may be a lockbox, apparently only one side has the keys to it 
because some $18 billion has already been dipped into in order to pay 
for spending in the present budget.
  While we have a lockbox, apparently only a handful of people have the 
keys to be able to dip into it when it becomes necessary to find 
funding. I hope, as well, we can find common ground solutions to the 
Social Security issue. As the Senator from Nebraska has pointed out, 
the long-term interests of all Americans depend upon our ability to 
make sure we have a trust fund that is sound and in good shape.
  I also recall a few years ago when there were proposals to amend the 
Constitution of the United States to require a balanced budget. The 
advocates of that proposal, of course, included that Social Security be 
calculated in reaching a balanced budget. There were those who argued 
that you couldn't do that because Social Security ought not to be used 
for that purpose. But those who were the authors of the constitutional 
amendment to balance the budget are some of the same ones today who 
argue on the lockbox. It wasn't a lockbox when we were talking about 
balancing the budget with a constitutional amendment. It is today. 
Nonetheless, I hope we can come up with some answers to this for the 
long-term.

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