[Congressional Record (Bound Edition), Volume 145 (1999), Part 3]
[Senate]
[Pages 3338-3340]
[From the U.S. Government Publishing Office, www.gpo.gov]




                      SOCIAL SECURITY AND MEDICARE

  Mr. DURBIN. Mr. President, the topic which I would like to speak 
about during this brief time on the floor is one which is important to 
millions of Americans and involves two of our most important and 
successful programs: Social Security and Medicare.
  They are so important to so many families that President Clinton has 
proposed that 77 percent of the surplus which we anticipate over the 
next few years be invested in both of these programs so that they will 
be available for future generations of Americans.
  There are some who believe that the surplus, as it is generated, 
should be spent instead and invested in tax cuts for Americans. Of 
course, any politician, any person in public life, proposing a tax cut 
is going to get a round of applause. People would like to pay less in 
taxes, whether they are payroll taxes, income taxes, or whatever. But 
we have to realize that a tax cut is instant gratification and what the 
President has proposed instead is that we invest the surplus in 
programs with long-term benefits to not only current Americans but 
those of us who hope in the years ahead to take advantage of them as 
well.
  We have to keep the security in Social Security and the promise of 
good medical care in our Medicare Program. And I think we have to 
understand that just solving the problems of Social Security is not 
enough; income security goes hand in hand with health care security.
  One of the proposals coming from some Republican leaders suggests 
that there would be a tax cut. And as you can see from this chart, the 
Republican investment in Medicare under this plan is zero, and the 
Republican investment in tax cuts, $1.7 trillion.
  Now, of course, that is quite a stark contrast. Instead of prudent 
investments, I am afraid that many of those who suggest tax cuts of 
this magnitude are not really giving us the bread and butter that we 
really need for these important programs like Social Security and 
Medicare. Instead, they are handing out these candy bar tax cuts. I do 
not think that that is what America needs nor what we deserve. Let me 
take a look at the tax cut as it would affect individual American 
families.
  There is a question that many of us have when we get into the topic 
of tax cuts, and that is the question of fairness, progressivity: Is 
this tax cut really good for the average working family? One of the 
proposals which has been suggested by a Republican leader and 
Republican candidate for President, who serves in the House of 
Representatives, is an across-the-board tax cut. Well, take a look at 
what this means for the families of average Americans.
  For the lower 60 percent of wage earners in America, people making 
$38,000 or less, this Republican tax cut is worth $99 a year, about 
$8.25 a month--not even enough to pay the cable TV bill. But if you 
happen to be in the top 1 percent of the earners, with an average 
income of $833,000, your break is $20,697.
  I listened over the weekend while one of our noted commentators, 
George Will, who was born and educated in my home State of Illinois, 
suggested: Well, of course, because people who make this much money pay 
so much more in taxes, they should get a larger tax cut.
  We have been debating this for a while, but we really decided it 
decades ago. In a progressive tax system, if you are wealthy, if you 
have higher income, then in fact you will pay more in taxes. So I do 
not think it is a revelation to suggest that people making almost a 
million dollars a year in income are going to end up paying more in 
taxes. Well, the Republican tax cut plan, as it has been proposed, an 
across-the-board tax cut, does very little for the average person, but 
of course is extremely generous to those in the highest income 
categories.
  Today in America, 38 million citizens rely on Medicare, including 1.6 
million in my home State of Illinois. By the time my generation 
retires, this number will have increased substantially. With these 
increasing numbers of Americans relying on Medicare, and advances in 
health care technology currently increasing costs, any way you look at 
it, you need more money for the Medicare Program, unless you intend to 
do one of several things:
  You can slash the benefits; you can change the program in terms of 
the way it helps senior citizens; you can ask seniors and disabled 
Americans who use Medicare, who are often on fixed incomes, to shoulder 
substantially higher costs; you can significantly reduce the payments 
to providers, the doctors and the hospitals; or you can increase 
payroll taxes by up to 18 percent for both workers and their employers.
  A report that was released today by the Senate Budget Democrats lays 
out some of these harsh alternatives that would be necessary if the 
Republicans refuse to make investments in the Medicare Program.
  President Clinton says, take 15 percent of the surplus, put it in 
Medicare; it will not solve all the problems of Medicare, but it will 
buy us 10 years to implement reforms in a gradual way. The Republicans, 
instead, suggest no money out of the surplus for Medicare, and instead 
put it into tax cuts. I think that is a rather stark choice.
  Mrs. BOXER. Will my friend yield?
  Mr. DURBIN. I am happy to yield to the Senator from California.
  Mrs. BOXER. I am so pleased that the Senator from Illinois has once 
more come to the floor to discuss something so fundamental to our 
country. I think if you asked people in the country, ``What is good 
about your national Government?'' yes, they would say a strong 
military; they would also say Social Security and Medicare.
  Has the Senator talked about the 1995 Government shutdown yet?
  Mr. DURBIN. Go ahead.
  Mrs. BOXER. I want to ask him a few questions and then let him finish 
his remarks.
  As the Senator was talking and showing this chart, it brought back to 
me the 1995 Government shutdown. We remember what that was about. 
Essentially, the President took a very firm stand in favor of Medicare, 
the environment, and education, and against the kind of tax cuts for 
the wealthy that would have meant devastating those programs. And the 
Government actually shut down over this. I am sure my friend remembers, 
it was a stunning thing. But it was really tax cuts for the wealthy, 
taking it straight from Medicare.
  Now what we have is a situation that is very similar. We know we have 
to fix Social Security. The Republicans have said they agree with that, 
but they are silent on the issue of Medicare. They do nothing about 
shoring it up whatsoever. And yet they propose the same kind of tax 
cuts.
  So I say to my friend, in 1995 Republicans essentially shut down the 
Government because they wanted these tax cuts at the expense of 
Medicare. And this year it looks like they are shutting down Medicare 
so they can go back to these tax cuts.
  I wonder if he sensed, as I did, as we watched this budgetary debate 
unfold--

[[Page 3339]]

if it did not bring back all these memories, and how he feels about 
that, because it was a pretty tough time we went through and I do not 
want to see those times repeated.
  I ask my colleague to comment.
  Mr. DURBIN. Of course I remember that period of time. It was an 
amazing period. I recall particularly the commentator, Rush Limbaugh, 
who enjoys some notoriety across America. He said: You know, if they 
closed down the Federal Government, no one would even notice. They were 
kind of goading us to go ahead and call the bluff of those who wanted 
to shut it down.
  Well, in fact the Government was shut down when Congress failed to 
pass the necessary bills to continue the funding of Government 
agencies. And across America people started noticing. I am sure the 
Senator from California--I was then a Congressman from Illinois--
received phone calls from people saying, ``Wait a minute. You mean to 
tell me that these workers cannot go to work and they're going to be 
paid ultimately? You mean to say the services that we depend on, that 
Government needs to do, aren't going to be performed?'' And that is 
exactly what happened.
  I think the American people were outraged over this, outraged that 
the Government would shut down. If there were those on the other side 
who believed that the American people would rally to their cause over 
this Government shutdown and say, ``Oh, you've got it right, give tax 
cuts to wealthy people, and go ahead and cut Medicare and cut the 
environmental protection and cut education programs,'' that did not 
happen.
  Mrs. BOXER. I wonder if the Senator would share with us the chart 
that he has there, because that goes back to 1995.
  Mr. DURBIN. Yes. I am happy to.
  Really, it is a good illustration of what happened. Back in 1995 with 
the Government shutdown, this was a time when the Republican Party was 
calling for tax cuts of $250 billion and was going to cut Medicare for 
that to occur. And that is exactly what led to the President's veto of 
their bill and ultimately led to the shutdown of the Government.
  Mrs. BOXER. Let me say to my friend again, I appreciate his 
leadership on this. We did hold a press conference today, the 
Democratic members of the Budget Committee, to call everyone's 
attention to this.
  When you deal with a budget the size of this Federal budget, it has a 
lot of important things that we do. But this is one thing that we need 
to call attention to, the fact that if we are going to protect Social 
Security and Medicare, we are going to have to defer these tax cuts for 
the wealthiest people, some of them earning millions of dollars, who 
would get back tens of thousands of dollars, while the average person 
would get back $99. As a result, we would see Medicare essentially shut 
down as we know it, and we don't want to go through another Government 
shutdown of that nature. We don't want a Medicare shutdown; we don't 
want an education shutdown. We want a budget that addresses these 
issues.
  Again, I thank my colleague. He and I have known each other a long 
time. We have both gone through the situation of aging parents 
together. We have talked many times about how important Medicare is. I 
will never forget my friend and I being on the floor of the Senate when 
there was a move to raise the eligible age for Medicare. He and I stood 
here and fought. We said right now people are praying that they will 
turn 65 so they can get some health insurance, and then if we increase 
that age when we should actually be reducing the age that people can 
get Medicare--we should allow the President's plan to go forward on 
that as well, to allow people to buy in if they have no Medicare at 55, 
60, and 62. This was going to raise the age. We told the stories of our 
families and how Medicare brought peace to our aging parents.
  So we are, I think, going to stand shoulder to shoulder through to 
the fight.
  I want to again thank him for yielding.
  Mr. DURBIN. I thank the Senator from California.
  Of course, she raises a point near and dear to all of us. Some people 
think Medicare is a program that seniors worry about. I think it is a 
program that their children worry about. They want to make sure that 
their mothers and fathers--grandparents in some instances--have the 
protection of Medicare. It is hard to believe this program only dates 
back about 35 years. It is a program that has now become so essential, 
and it is a program that has worked.
  As a result of the Medicare Program, people are living longer, the 
quality of health care for elderly people has improved. At the same 
time, the Medicare Program has really democratized health care across 
America. Hospitals, which once might have served the very elite 
clientele, now serve virtually everyone because they are part of the 
Medicare Program. I think that is a plus. I think that says a lot about 
our country.
  I worry when I look at the alternative budget plans here because the 
Democratic plan is very specific. It says if there is to be a surplus--
and we think there will be--that this surplus should be used for 
specific purposes: to save Social Security and to preserve Medicare. 
Unfortunately, on the other side, there is no mention of Medicare. The 
Republican proposal doesn't talk about putting any of the surplus into 
Medicare.
  That, I think, is shortsighted, because if you don't put the surplus, 
a portion of it, into Medicare, it causes some terrible things to 
occur. For instance, to extend Medicare to 2020 without new investment, 
without the influx of capital which we are talking about in the 
surplus, and without benefit cuts and payroll tax increases, we would 
need to cut payments to providers by over 18 percent. That is a cut of 
$349 billion. For the average person, these figures, I am sure, swim 
through their head. They think, What can that mean?
  What it means is your local hospital, your local doctor, the people 
who are providing home health care for elderly people to stay in their 
homes, would receive less in compensation. As they reduce their 
compensation, many of them will not be able to make ends meet. I have 
seen it happen in Illinois already.
  I have been somewhat critical of the Clinton administration. Some of 
the changes they have made in home health care services, I think, are 
very shortsighted. Many seniors, for example, would love to stay in 
their homes. That is where they feel safe and comfortable. They have 
the furniture and the things they have collected through their lives 
and their neighbors who they know. They don't want to head off to some 
other place, a nursing home or convalescent home. They would much 
rather stay in their home. What do they need to stay there? Many times 
just a visit by a nurse, a stop by a doctor once in a while. Although 
that seems extraordinary in this day and age, the alternative is a much 
more expensive situation where someone finds himself in a nursing home 
with extended and expensive care.
  I hope that we realize that we made a mistake in 1995 when we had 
this Republican tax cut of $250 billion at the expense of Medicare and 
the Government was shut down. I hope we don't repeat it. We called the 
hospitals in our State of Illinois back in 1995 and asked what would 
this mean to you, if, in fact, you lost some $270 billion in Medicare 
reimbursement; what would it mean? Most of the hospitals were reluctant 
to speak openly and publicly and on the record. They told us privately 
many of them would have to close because many hospitals in my home 
State of Illinois and rural States like Kansas depend to a great extent 
on Medicare and Medicaid to reimburse their services and to keep their 
doors open. So, cutbacks can cost us the kinds of hospitals we need in 
areas that, frankly, are underserved medically.
  Large cuts that might be envisioned without dedicating part of the 
surplus could threaten many of these hospitals. When a hospital closes, 
it isn't just the seniors who are affected. The whole community 
suffers. It is a situation in

[[Page 3340]]

 many of my rural towns and downstate Illinois where that emergency 
room is literally a matter of life or death. Farmers, miners and people 
who work around their homes count on the availability of their 
services. When a hospital's financial security is put under significant 
strain, they are forced to look for other sources of revenue. Cost 
shifting becomes inevitable. So virtually every American would pay for 
Congress' failure to invest in Medicare.
  The second option, if we don't invest a portion of the surplus into 
Medicare, is one that would ask seniors and disabled to pay more for 
their own medical care. They would need to double their contributions 
to extend the solvency of Medicare to the year 2020 if the President's 
proposal of investing 15 percent of the surplus into Medicare is not 
made.
  Take a look at this chart to get an idea of what it means to a senior 
citizen. This is a chart which shows the current amount that is being 
paid in part B premium of $1,262; then take a look, if we do not 
dedicate a part of the surplus, what the senior will have to pay 
instead. Instead of $100 a month, it is over $200 a month.
  Some might say it is not too much to go from $100 to $200. I think 
they don't understand that many senior citizens live on fixed incomes, 
very low incomes, and that this kind of premium increase in order to 
continue Medicare as they know it would cause a great hardship to many 
of their families.
  Today, on average, seniors pay 19 percent of their income to purchase 
the health care that they need. Medicare is currently only paying about 
half of their bills. These seniors living on fixed incomes are really 
going to face some sacrifice if this increase takes place. The medium 
total annual income of Americans over the age of 65 is a mere $16,000; 
for seniors over 85, it is even less, $11,251; for the oldest and 
frailest among us, such as those using home health services, the 
average income is less than $9,000. Now, can someone making about $800 
a month, for example, see an increase in their Medicare premium from 
$100 to $200 without some personal sacrifice? I don't think so. 
Medicare as it is currently drawn up helps seniors to live with 
dignity. Medicare reform may involve tough choices but it shouldn't 
involve mean choices. This Medicare reform on the backs of seniors and 
disabled, unfortunately, leads us to that.
  Reform and investment are clearly needed to strengthen Medicare. 
There are some who will say all you want to do is spend more money; you 
have to do more fundamental things like reform. I don't disagree with 
the concept of reform. I think it is part of the package. But the 
reality is, the Medicare Program has grown, the number of beneficiaries 
has doubled since the program was enacted, and Americans are living 
longer.
  I think there is a fair argument to be made that one of the reasons 
that Americans are living longer is because of Medicare and the access 
to health care that it provides. Before Medicare, less than 50 percent 
of retirees had health insurance. Now, virtually every one of them 
does. This is a question of priority. How much do we value increased 
life expectancy? Are people in my generation who are working and 
actually contributing to the surplus--a surplus that we hope to soon 
have--willing to put off a tax cut to make sure that Social Security 
and Medicare are there for decades? Are we willing to invest in what is 
basically our own retirement health insurance program in the years to 
come?
  By not enacting a massive tax cut that benefits the most wealthy 
Americas, but instead passing more limited tax cuts targeted to help 
working families, we can, in fact, get a tax cut that is reasonable and 
consistent with saving Social Security and Medicare. It seems very 
unwise to enact large tax cuts before we secure both of these important 
programs.
  Let me close by saying that this budget season is one that causes 
many people's eyes to glaze over. I have served a combination now of 
about 8\1/2\ years on Budget Committees in the House and the Senate. I 
do my best to keep up with it. It is an arcane science to follow this 
budget politics. But I have to say that it does reflect our values. We 
have to decide what is important.
  Last week, we had a bill on the floor here that was, on its face, a 
very good proposal--a bill that would have increased military pay and 
retirement benefits. I believe that those things should happen. The 
President proposed it, the Republican Party and Democratic Party agree 
on it. But the bill that came to the floor was significantly different 
than the President's proposal. In fact, it spent about $17 billion more 
over 6 years than the President had proposed.
  This bill came to the floor of the Senate without one committee 
hearing. Some came to the floor and said we need to do this so that men 
and women will stay in the military, and that we give them adequate pay 
and the reward of retirement. So they suggested we vote for the bill. I 
didn't think it was a responsible thing to do. I can remember that, two 
years ago, on the floor of the Senate we tied ourselves in knots over 
amending the Constitution to provide for authority to the Federal 
courts to force Congress to stop deficit spending. We had reached our 
limits and we had said that the only thing that could control 
congressional spending is a constitutional amendment and court 
authority. Well, that constitutional amendment failed by one vote. But 
that was only two years ago. We were so despondent over dealing with 
deficits two years ago that we were at the precipice where we were 
about to amend the Constitution and virtually say we have given up on 
congressional responsibility in this area.
  Well, here we are two years later, and the first bill we consider is 
not a constitutional amendment about deficits, but rather one over 
spending this surplus on military pay raises that we cannot justify in 
terms of their sources. I have asked a variety of members and people in 
the administration where would the extra money come from--the extra $17 
billion--for military pay raises. They say, ``Frankly, we don't know.'' 
I don't think that is a good way to start the 106th Congress, in terms 
of its substantive issues; but it is a reminder that we need a budget 
resolution that honestly looks at our budget to maintain not only a 
balanced budget, but surpluses for years to come, and investment of 
those surpluses in a way that we can say to future generations that, 
yes, we understood; we had a responsibility not only to the seniors, 
but to the families and their grandchildren, to make sure that those 
programs would survive.
  So, Mr. President, I hope that as this debate continues we can find 
some common ground to work together to make sure that the surplus as it 
exists in the future is invested in programs of real meaning to 
American families for many years to come.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. ALLARD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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