[Congressional Record (Bound Edition), Volume 146 (2000), Part 1]
[Senate]
[Pages 1053-1056]
[From the U.S. Government Publishing Office, www.gpo.gov]



                               THE BUDGET

  Mr. KERRY. Mr. President, as we approach the budget debate this year, 
I think it is important for us to take a moment ahead of time to think 
about the broad outline of what we spend money on and also what we do 
not spend money on--how we allocate the priorities of this budget--
because the budget is, after all, the most concrete, clearest 
expression of the priorities and intentions of the Congress.
  I would like to walk through that for a moment, if I can, and then 
make a proposal to my colleagues, which I hope might, in the context of 
this year's surplus and the choices we face, be attractive.
  The reality is, of the $1.8 trillion we will spend this year, the 
largest single expense, as we all know, goes to Social Security. The 
Federal Government is going to spend $400 billion or 22 percent of the 
Federal budget on monthly retirement and disability payments for about 
45 million Americans who are either senior citizens or disabled.
  The second largest commitment will be made to Medicare, nearly $220 
billion or 12 percent of the Federal budget, ensuring that virtually 
every individual over the age of 65 receives health insurance benefits 
covering hospitalization, physician services, home health care, limited 
nursing home care, and laboratory tests, and providing health benefits 
to roughly 5 million disabled people.
  In those two expenditures alone, we have spent a little over one-
third of our budget on Social Security and Medicare. Of the remaining 
$1.2 trillion of that budget, we will spend $115 billion or about 6.5 
percent of the budget on Medicaid. Those are, obviously, the health 
care benefits we provide to the least able to afford health insurance. 
In addition, we will spend about $110 billion or a little over 6 
percent of the budget on Federal, civilian, and military retirement and 
disability benefits as well as veterans benefits.
  When you throw in the other mandatory entitlement programs--such as 
foster care, unemployment compensation, farm price supports, food 
stamps, and supplemental security income, which is, as everybody knows, 
an income safety net for the poorest people in America--we then reach 
over $1 trillion in Federal spending.
  This year, of the $1.8 trillion Federal budget, over $1 trillion will 
go towards the mandatory entitlement programs that, while vitally 
important, are on autopilot. We are not going to make individual 
judgments about them except to the degree we decide we need to shore up 
the Medicare program or shore up the Social Security program. They are 
basically on autopilot in terms of their existence. The consensus of 
the Congress wants them; the country wants them. We support them. They 
don't need to be renewed, and they don't need to be reauthorized. They 
obviously are not appropriated on an annual basis.
  When we talk about the budget that we, as Members of Congress, are 
going to be dealing with in terms of discretionary spending, where we 
will make long-term investments, where we have some flexibility, we are 
dealing with about $800 billion.
  All of us understand what happens very quickly to that remaining 
portion of the budget, to those $800 billion. Two hundred twenty-four 
billion or 12 percent of the Federal budget will go almost immediately 
to interest payments on the national debt. We are grateful that having 
reached the point of having a surplus, and with the President's 
proposal, we can see an end to

[[Page 1054]]

the payments of interest on the national debt by the year 2013. But for 
the moment, 12 percent of the Federal budget this year is going to go 
to pay interest on the national debt. Those payments are not optional.
  Putting that spending aside, we are now left with about one-third of 
the overall Federal budget or $600 billion which we now can use to 
cover all other Government functions. But that disappears very quickly. 
Two hundred eighty-three billion of that budget will be spent on 
national defense this year, nearly 16 percent of the Federal budget. 
Another 2.5 percent of the budget will be spent building highways, 
channeling harbors, financing mass transit, all to a cost of about $45 
billion this year. Then you factor in housing assistance, nutrition 
programs, at a cost of about $42 billion, that is another 12 plus 
percent of the budget. And less than 2 percent of all the budget will 
go to health research, public health programs, searching for a cure to 
cancer, for HIV-AIDS, licensing new drugs for the marketplace, programs 
to attack teen smoking, services for the mentally ill.
  One and a half percent of the budget will go to crime control, 
putting cops on the street, fighting drug trafficking, and barely 1 
percent of the budget will go to foreign aid. Many Americans labor 
under the perception that somehow foreign aid is this vast proportion 
of the Federal budget. In fact, foreign aid is a significantly less 
percentage and real expenditure than it was under Ronald Reagan. I 
think we spent two or three times as much under Ronald Reagan in 
foreign affairs than we are spending today, which, I might add, is 
particularly ironic when you measure the changes in the world and the 
need for the United States to be more involved, not less involved, in a 
world that is increasingly globalizing and where we are all feeling the 
impact and forces of technology.
  The point I make to my colleagues today: For what most people agree 
is the single most important investment we can make in America, there 
is precious little money remaining. How many of my colleagues in the 
last years, recognizing the impact of the technology revolution, have 
come to the floor emphasizing the importance of education in America? 
We reap the benefits and the deficits of our attention to education in 
a thousand different ways. When Senators come to the floor and talk 
about the increasing problem of children having children, babies being 
born out of wedlock, the number of kids in America who are at risk, we 
should be directly examining how many of our schools stay open into the 
evening, how many of our schools have afterschool programs. How many of 
our schools don't even have an ability to be able to track children who 
are truant?
  It used to be that in the United States of America there was an ethic 
that when children were not showing up in school, the truant officer 
went out and found the kids. We did something about it. Today, you can 
be a kid in school and not show up and nobody even stops to wonder what 
happened. In too many schools in America they may not even contact what 
is too often a single parent and find out whether that single parent 
might have had time to be able to be aware that their kid might not be 
in school or what they might have time or ability to be able to do 
about it.
  I don't raise this issue of spending to try to disparage the other 
budget priorities. I think they are all priorities. I vote for them. I 
support them. I think everybody in the Senate understands the 
importance of all of the things I listed. We have built up a very real 
bipartisan consensus on the importance of most of these investments.
  But why is it that in the year 2000, after years of talking about 
education's importance and education reform, we are so absent a 
consensus in this institution on the need to be investing in 
communities that have no tax base with which to improve the school 
system? Ninety percent of America's children go to school in public 
schools. We waste more time on the floor of the Senate debating some 
alternative to public schools, such as vouchers or charters, rather 
than figuring out how we are going to fix the public school system and 
invest in it properly so those 90 percent of our children have a place 
to grow up properly and share in the virtues of this new world that 
America is increasingly witnessing and even playing a critical role in 
developing.
  Every one of us meets with the extraordinary creative energy of the 
new technology community of this Nation. We have remarkable people 
doing remarkable things. We have companies that have built up more 
wealth faster than at any time in the history of this Nation. But there 
is an enormous gap for those companies in their capacity to grow over 
the coming years. Every chief executive of every technology company in 
our Nation will tell us again and again and again that their greatest 
restraint on growth is the lack of an available skilled labor pool. 
There are some 370,000 jobs going wanting today in the technology 
field.
  (Mr. ROBERTS assumed the chair.)
  Mr. KERRY. We are going to debate in Congress whether we are going to 
expand visas to bring immigrants from other countries to fill the jobs 
a properly educated young American ought to be able to fill or would 
want to fill if they had the opportunity to be able to do so. I think 
it is important to point out that out of a $1.8 trillion Federal 
budget, we are spending a relatively tiny amount of money to empower 
local communities to improve student achievement, to support teacher 
and administrator training, to help finance and encourage State, 
district, and school reforms, to recruit teachers, to fix failing 
schools, and to provide children the extra help they need to meet the 
challenging academic standards that are needed to make it in today's 
world.
  Let me speak quickly to the teacher situation, Mr. President. For 3 
years now, some of us have been coming to the floor of the Senate to 
warn our colleagues and America of our need to hire 2 million new 
teachers in the next 10 years. Why do we need to hire 2 million? 
Because we lose 40 percent of the new teachers in the first 3 years; 
because the schools are in such disarray, they have burnout in a mere 3 
years, or they find the support systems are so inadequate they don't 
want to continue to teach. But we are also losing them because we have 
a whole generation of teachers reaching retirement age and we need to 
renew the teaching profession.
  Ask any kid in college today: Do you want to go teach? How many kids 
plan to go teach in today's world? I read in the newspapers yesterday 
that the starting salary for an associate in a major law firm in Boston 
or New York is now equivalent to the salary of a Senator--about 
$140,000 a year. That is what you get the day you get out of law school 
and go to work for a large law firm.
  If you want to, coming out of college today--and most kids need to 
because the average student gets out of college with about $50,000 to 
$100,000 worth of loans--they can look to go into some dot-com company 
where they can earn $60,000 or $70,000 within the first year or so of 
employment. What does a teacher get--$21,000, $22,000 a year? And after 
15 years of teaching, when you have broken through and gotten your 
master's degree, you can get into the midthirties or high thirties. In 
some school districts, you may break into the forties. You can wind up 
an entire career of teaching and be earning maybe somewhere in the low 
fifties, high fifties, and very few districts hit the sixties. How do 
you attract anybody, under those circumstances, to do what we pretend 
is the most valued profession one can undertake--teaching.
  So this year we are going to spend a grand total of slightly over $19 
billion for all elementary and secondary education initiatives--or just 
barely over 1 percent of the $1.8 trillion Federal budget. When we hear 
our esteemed budget committee leaders talk about the great commitment 
on the part of Congress or the Federal Government toward improving 
education, I ask people to remember that what we are talking about is 1 
percent of that Federal budget. We put so much more money

[[Page 1055]]

into the back end of life in America, whether it is through Medicare or 
through Social Security, or just dying in a hospital--I hate to say it, 
but, tragically, in the last 2 weeks of life in America. We spend so 
much more at the back end of life than we invest when the brain is 
developing and it is in the most important stage of life.
  Not one scientist will fail to document that what a human being will 
be--their capacity to think, their capacity to socialize, their 
capacity to be able to learn and to be a full participant in society--
is 95 percent determined in the first 3 years of life. And we invest a 
fraction of a percentage of our budget to guarantee that children are 
safe and nurtured and, indeed, given the opportunities to have the 
maximum amount of brain development and opportunity for safety in those 
stages.
  Our young people pull in about a penny on every dollar in terms of 
the investment priorities of the U.S. Congress. The National Center for 
Educational Statistics reports that the Federal Government provided 8.4 
percent of total expenditures for elementary and secondary education 
from 1970 to 1971. It was 9.2 percent from 1980 to 1981. Yet last year 
we provided only 6.1 percent. The school population goes up, the demand 
goes up, but the commitment of the U.S. Congress, in total terms, goes 
down.
  Let me put this in a different perspective, if I may. Let me compare 
the cost of investing in our children to the cost of some of our 
recently enacted tax provisions. In 1997, the President proposed, and 
Congress agreed, to create a new capital gains exclusion on home sales. 
Today, a homeowner can exclude from tax up to $500,000 of the capital 
gain from the sale of a principal residence. Obviously, we all agree 
that exempting the sale of a home from capital gains taxation is a good 
thing, and I am for that. Calculating the capital gain from the sale of 
a home is perhaps one of the most complex tasks a typical taxpayer 
faces because they have to keep detailed records of transactions on 
home improvements, they have to draw distinctions between improvements 
that add to the home's basis and repairs that don't. But what does it 
say about our national priorities--that the cost of exempting up to 
$500,000 of gain on the sale of a home will cost the Federal Government 
$18.5 billion this year. We are going to give up $18.5 billion of our 
revenue because we have decided it is important to reflect this 
``priority.'' That is almost exactly the amount of money we spend as a 
nation on all elementary and secondary education.
  Mr. President, I think that is a disturbing budget reality, and it is 
an incontrovertible fact, which I believe requires us to try to 
reconcile with the current demands we face from millions of Americans, 
whether they are parents, teachers, or business leaders, all of whom 
are asking us to help improve the schools of this Nation.
  Now, I point this out because I believe now, when we enjoy the 
greatest economic expansion in the history of our Nation, we have an 
opportunity to lay the foundation for a new era in America. It is an 
opportunity to fix our schools, to increase their accountability, to 
recruit more and better teachers, and to reduce the average class size. 
I share with my Republican colleagues the desire to guarantee that we 
have a new accountability in the school systems. I believe we can reach 
a consensus and achieve that. But it must be done by some commitment of 
additional resources in order to allow the reformers at the local level 
to empower their States and local school districts to be able to turn 
their schools around.
  Under the CBO's most recent estimates, the on-budget surplus--that 
is, the non-Social Security surplus--will amount to somewhere between 
$800 billion and nearly $2 trillion. I believe their most conservative 
estimate is probably the better place for us to start. That 
conservative estimate assumes that spending will continue to increase 
at the rate of inflation. It assumes the continuation of emergencies, 
such as droughts in the Midwest and hurricanes on the east coast. It 
even assumes the continuation of unlikely events such as a decennial 
census every year--when we all know that expense occurs only once every 
10 years.
  I ask my colleagues to focus on the fact we are not talking about 
just Social Security now. We are assuming that the Social Security 
surplus is locked up, as it ought to be and as we wanted it to be. But 
we must decide to dedicate a portion of these surpluses towards the 
appropriate investment priorities of the Nation. Yes, that includes 
Medicare reform and putting it on solid footing. Yes, it includes a 
prescription drug benefit to help people pay the extraordinary costs of 
prescription drugs. We should dedicate a portion of that surplus 
towards debt reduction so we can keep reducing interest rates, and 
reduce the future interest obligations and extend the virtuous cycle of 
fiscal discipline which is at the heart of our economic expansion. Yes, 
we ought to pass some targeted tax cuts for middle-income families--
such as the marriage penalty, estate tax relief, and an increase in the 
standard deduction. We can do those things.
  We can also reserve an appropriate amount of money for the education 
of our young people--to raise that education to the level of rhetoric, 
to the level of campaigning, and to the level of debate that has 
existed in the Congress in the past years. I think the Congress has a 
unique opportunity this year to tell America that our young people at 
those critical stages of development are worth more than one penny on 
the dollar.
  I intend to introduce a 21st century early learning and education 
trust fund. This legislation would set aside 20 percent of the most 
conservative CBO estimate of the on-budget surplus over the next 10 
years only. I believe, with all of the debate on both sides of how to 
raise student achievement and reform public education, about the 
growing acknowledgment on both sides that reform costs money, that we 
should at the very least take a step that locks up a portion of the 
budget surplus and dedicate this money to early learning, and to 
education as a whole, where the country gets the greatest return on 
investment. Almost every analysis suggests that for $1 put into 
education at that stage, a minimum of $6 is returned to the Federal 
coffers over the course of the next years in one way or another.
  My proposal would set aside $2.2 billion this year, $30 billion over 
5 years, and nearly $170 billion over 10 years for education, for early 
learning, for childhood interventions, which will make a difference in 
building the fabric of families. That will help us break the cycle of 
children having children out of wedlock. That will help us solve the 
problem of parents who do not have time to be parents and be with their 
children in those critical hours of the afternoon when most kids get 
into trouble.
  It will literally turn around the fabric building of our own Nation 
and ultimately provide us with an educated workforce that has the 
ability to continue the extraordinary economic growth we experienced 
these last years, as well as, I might add, empower us to be able to 
guarantee that a citizenry that grows up in a world of more information 
has the skills and capacities to be able to manage that information 
and, indeed, contribute to the wise decisionmaking--the wise choosing 
of policies in a world that will become increasingly more virtual, more 
capable of making faster decisions with more information being thrown 
at people and people trying to discern the truth for themselves. As 
Thomas Jefferson and George Washington, the Founding Fathers of this 
country, understood, nothing is as important as that effort of 
guaranteeing that your citizenry is educated.
  The funds that would be held by the education trust fund could be 
used--and only used--to finance legislation to approve the quality of 
early learning through secondary education above the current inflation-
adjusted baseline. Eligible uses include but would not be limited to 
programs and reforms authorized under the Elementary and Secondary 
Education Act and the Head Start Act. Trust fund expenditures would 
have to traverse the normal budget process.

[[Page 1056]]

  If Congress were unable to agree on how to use trust fund revenue or 
if Congress simply doesn't commit enough resources to trigger the use 
of the trust fund, the trust fund assets would be carried over to the 
next year. The trust fund would work similar to the Social Security 
trust fund. On paper, those assets would carry forward to the next 
fiscal year. In reality, unspent funds would be used to pay down the 
public debt.
  Trust fund revenue would not be available for anything other than 
these education specifics. Appropriators could not tap those trust fund 
moneys for sugar subsidies, for pet projects, or for other related 
purposes. Tax writers could not tap into trust fund money to pay for 
special interest tax breaks. But tax writers could use the trust fund 
money for education purposes ranging from school construction bonds to 
any other number of priorities on which the Congress could reach 
consensus. In effect, the trust fund would create a budgetary firewall 
protecting our national commitment to young people for early learning 
and education generally.
  I have strong views about how some of that money might be best spent. 
But that is a debate for a different day. The question before us, as we 
think about the budget as a whole, particularly since it is the first 
budget of the new millennium, is, What is our commitment as a nation to 
education? Are we satisfied that one penny per dollar less than we used 
to commit under Ronald Reagan and less than we used to commit under 
Richard Nixon is currently being committed by the Federal Government 
for the purpose of building the future fabric of this Nation? I don't 
think I am alone in believing that surplus funds ought to be used to 
some degree in some manner for these education expenses.
  In the State of the Union Address, the President pledged to increase 
our commitment to the Nation's education system by using surplus funds. 
In fact, his fiscal year 2001 budget requests an increase in 
discretionary spending for $5.7 billion for elementary and secondary 
education. I wholeheartedly support that critical increase. But I know 
and you know, Mr. President, and all of us in this Congress know that 
if we put together the proper structure that requires accountability 
that changes the relationships that currently exist in our public 
education system, that embrace choice, competition, accountability; 
that if we unleash the capacity of our school systems to be the best 
they can be, whether it means adopting the best of a charter school, 
the best of a parochial school, the best of a private school, the best 
of the best public schools, we have the ability in this Congress to 
find a way to guarantee that local communities embrace real concepts of 
reform. But none of those concepts can be properly implemented without 
some commitment of resources for communities that have no tax base and 
no ability to fund those systems through the property tax.
  This is our mission, and $5 billion is not enough to fix our schools, 
or to guarantee a qualified teacher in every classroom, or to provide 
students with meaningful afterschool programs.
  I am not suggesting a Federal mandate. I am not suggesting the long 
arm of Washington reaching in and telling people how to do it. To the 
contrary. I am suggesting that we leverage the capacity of local 
districts to make those choices for themselves. If we don't tell them 
how to get there as true fiscal watchdogs looking over our taxpayers' 
dollars, we will look on the back end to see they did get where they 
said they were trying to go. If we in this body intend to make 
education a top priority and work for serious reform, we have to 
guarantee children have access to those things that will contribute to 
their education's success.
  I have never been able to reconcile in the Senate how it is that we 
are so ready to augment the expenses for the juvenile justice system, 
build new prisons and house people for the rest of their life for 
$35,000 to $75,000 a year, but we are unwilling to invest $35,000 a 
year to keep them out of those prisons and to provide them with a set 
of other choices when it matters the most. That, it seems to me, is the 
obligation of this country. The American people want funding for 
education increases. The American people in community after community 
know they can't take any more on the property tax burden. Seniors who 
want to live out their years in the house they paid for can't see the 
property tax go up. Young families with a fixed stream of income who 
bought into their first home can't see the property tax go up. However, 
we fund our education system as if we were still the agrarian society 
which set up the entire structure for property tax in the first place.
  Our obligation is to find a way to release the creative energies and 
learning capacities of our Nation. If we were to find a bipartisan 
consensus and reach across the aisle to end this wasted debate about 
saving a few kids rather than saving all of the kids, it seems to me we 
would have the ability in the Congress to achieve something that would 
truly be a long and lasting legacy. It would be a great beginning for 
this millennium.
  Education is the No. 1 issue in America. It deserves more than a 
penny, a dollar. That, it seems to me, is the mission we should embark 
on over the course of these next months.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. LOTT. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LOTT. It is such pleasure to see the distinguished Senator from 
Kansas in the chair. I know the Chamber will be kept in order, and we 
will make real progress.

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