[Congressional Record (Bound Edition), Volume 146 (2000), Part 17]
[Senate]
[Pages 25473-25475]
[From the U.S. Government Publishing Office, www.gpo.gov]



                          THE AMERICAN CHOICE

  Mr. DURBIN. Mr. President, let me follow up on a statement made by 
the Senator from Nevada about the choice the American people are facing 
in just a very few days.
  I think if you believe that governing America is easy business, then 
the choice is easy, too.
  I happen to think that the set of circumstances the next President 
will face is pretty challenging.
  I can recall only a few years ago on the floor of the Senate when we 
spent most of our time debating deficits and

[[Page 25474]]

talking about constitutional amendments to end deficits. But now we are 
debating surpluses. What are we going to do with the extra money?
  We believe on the Democratic side that the first obligation has to be 
to reduce the national debt so that our kids don't carry that burden, 
and strengthening Social Security and Medicare. We believe that after 
we have met those obligations, we should target tax cuts to help the 
middle-income and working families deal with problems that are 
meaningful, problems such as paying for college education for their 
kids.
  We believe on the Democratic side we should be able to deduct up to 
$12,000 a year of tuition fees paid for your children in college. I 
have taken that across the State of Illinois, a pretty diverse State, 
and it is widely accepted. People believe that is an excellent change 
in the Tax Code.
  We also want to give families--working families, single mothers, too, 
for that matter, who need to have good quality day care--an additional 
tax credit so they can afford to leave their kids in safe day care. We 
say to the mother who wants to make the sacrifice to stay home with the 
kids, you deserve a tax break too; you are making a sacrifice. Our Tax 
Code should recognize that. That is targeted tax cuts the Democrats 
support.
  So many people have aging parent and grandparents. We want to 
increase the deductibility of expenses incurred in caring for their 
parents. Baby boomers have noted their parents need extra help as they 
live a longer life. They need extra assistance. We want to be there. 
The Tax Code should support families who do their best to help 
relatives, to help their parents.
  We believe, bringing this together, we can keep America moving 
forward because we won't be embarking on a risky tax scheme, one that 
has been proposed by Governor Bush. The idea of $1.6 trillion in tax 
cuts, 40 percent of which go to the wealthiest people in America, is a 
bitter pill to swallow. Who are the top 1 percent wage earners in 
America? People who make over $25,000 a month, over $300,000 a year. 
Governor Bush says these poor struggling people making only $300,000 a 
year need a tax break, $2,000 a month worth of a tax break.
  I am sorry, but, frankly, I prefer to target that tax break to the 
people who really need it. A fellow such as Bill Gates at Microsoft has 
been very successful, God bless him for his creativity, but this man's 
net worth is greater as an individual than the combined net worth of 
106 million Americans. Does he need Governor Bush's tax break? I don't 
think so. I know a lot of families across Illinois want to have a tax 
break to send one of their kids to college so that kid might have a 
chance to have a successful career and business or whatever they 
choose.
  That is the difference. That is the choice. I think a lot of people 
in this election want to overlook a little history. Let me share some 
of that history.
  Mr. REID. Will the Senator yield?
  I ask unanimous consent that the time I consume asking questions not 
be charged against the Senator from Illinois.
  The PRESIDING OFFICER. It will be charged against the Democratic 
time.
  Mr. REID. I say to my friend from Illinois, does the Senator agree 
the best tax cut the American people could get would be if they paid 
down the national debt? That would give Bill Gates a break and 
everybody in America a break; is that not true?
  Mr. DURBIN. The Senator from Nevada is right. If we pay down our 
debt, we stop borrowing to service the debt. As we stop borrowing, the 
demand for capital goes down. That is, the cost of capital goes down, 
which is the interest rate. As interest rates go down, every family in 
America can feel it on their mortgage payment, on their loan for school 
payment, or their auto payment. That is as good as, if not better than, 
a tax cut, if we reduce that burden on our kids and bring down the 
interest rates in the process.
  Mr. REID. One more question I want to ask my friend from Illinois. I 
have a long-time friend; we went to high school together. We were 
inseparable friends. He was my chief of staff until he retired 2 years 
ago. His mother has been very ill. She passed away last night.
  The point I want to make is this: My friend's sister, my friend 
Gloria, with whom I also went to high school, spent many months caring 
for her mother in her home. She gave up her job. It was a tremendous 
burden, but it was her mother. She did it; she is a caring person; she 
gave up her life to take care of her aged mother.
  Do you know what tax break she got from that? Nothing.
  As I understand what my friend is saying, the Senator thinks we 
should spend a little bit of this surplus to give my friend Gloria a 
tax break so that she and other people similarly situated who are 
willing to take care of their mother or other loved ones--and there is 
no better care that can be given--should be given some kind of tax 
incentive for doing this; is that what my friend is saying?
  Mr. DURBIN. That is exactly right. If you really believe in family 
values, is there a stronger family value than a son or daughter willing 
to sacrifice for an aging and ailing parent? If we are going to support 
family values with the Tax Code, shouldn't we include in that Tax Code 
some assistance for your friend and her situation? They would give 
$2,000 in tax breaks to Bill Gates, and he wouldn't even notice it. I 
am telling you, your friend will, as will a lot of other baby boomers 
across American who are caring for their parents. That is the 
difference. That is the choice. It really is a graphic choice.
  If you look at this chart, there has been a suggestion that having 
surpluses at the Federal level must be easy, so anybody can do it, yet 
history tells otherwise. It wasn't until halfway through the Clinton-
Gore administration that we finally turned the corner, and now we are 
generating the largest surplus in history. We are paying down America's 
debt for the first time.
  Look at all the red ink that occurred under Ronald Reagan and 
President George Bush and the early years of the Clinton 
administration. We finally turned this corner in the belief we could do 
a $1.6 trillion tax cut for the wealthiest people and take $1 trillion 
out of the Social Security surplus and use it for some privatization 
scheme. Frankly, I don't think that is responsible. If I owe anything 
to the people of Illinois and this country, it is to maintain the 
economic growth and prosperity we have seen.
  Let me mention one other point. Basic economics says Alan Greenspan's 
greatest fear is inflation. Every time he thinks we are moving toward 
inflation, what does he do? He raises interest rates a notch and slows 
things down. I can also say you can create inflation with government 
spending or tax reductions. Injecting $1.6 trillion into our Nation's 
economy through tax cuts will energize the economy and create 
inflationary pressure, forcing the Federal Reserve to raise interest 
rates in response.
  So George W. Bush gives a tax break on one hand and creates an 
economic circumstance that raises interest rates on the other. You get 
to take your new tax break and pay for a higher ARM, your adjustable 
rate mortgage on your home. There is no benefit to your family. There 
is a real benefit if you reduce the debt, the deficit of this country, 
and make sure our kids don't bear that burden.
  Mr. REID. Will the Senator yield?
  Mr. DURBIN. Yes.
  Mr. REID. I see the illustrative chart. It appears to me every year 
that President Clinton has been in power, in office, the deficit has 
gone down. Does the Senator from Illinois--and I was in Congress in 
1993 when we took a very tough vote, the Clinton budget deficit 
reduction act was a tough veto. Not a single Republican voted for it in 
the House, not a single Republican over here. Al Gore came over and 
broke the tie.
  Would the Senator agree with me, that is what put the country on the 
road to economic recovery where we created 22 million jobs--the lowest 
unemployment in 40 years--we have surpluses instead of deficits; we 
have a Federal Government today that is 300,000 people fewer than when 
Gore

[[Page 25475]]

and Clinton took office? Does the Senator believe that is the reason 
this chart is illustrated the way it is?
  Mr. DURBIN. I don't think there is any doubt. It was a tough vote, 
and we both know some of our colleagues lost their reelection campaigns 
because of it, because people demagogued and said it was the biggest 
tax increase.
  It was on the wealthiest people in the country and also the biggest 
tax cut in history, and it was right thing to do. It was the right 
medicine. People on Wall Street and the business community know we 
finally have a President who will take a difficult but necessary path 
toward bringing us to a surplus economy. That is exactly what has 
happened.
  To think this could happen under any President, I say, is wishful 
thinking, because I have served under three Presidents and I can say in 
the early days we didn't see any indication that the deficits were 
going to decrease. In fact, just the opposite is true. We can see in 
the President George Bush era the deficits were increasing each year. 
It wasn't until the Clinton-Gore administration started that the 
deficits were reduced, leading to a surplus.
  Then take a look at the overall impact to which the Senator from 
Nevada alludes. We are in the longest economic expansion in the history 
of the United States of America, 115 months. We have seen the effort 
made, the longest sustained surplus coming out of our Federal deficit 
in our history. We have seen more money generated to pay down debt than 
at any time in our history. What does it mean?
  As the Senator has noted, the unemployment rate of this country has 
been coming down steadily since 1992, the election of Bill Clinton and 
Al Gore. We can see the unemployment rate is the lowest peacetime level 
in 42 years. This does not happen automatically. It isn't just 
something we can expect to see automatically. We have to make the right 
choices. Some of them are difficult. Some are painful. Some are easily 
demagogued in 30-second ads. These choices have paid off for America.
  Let me show the Senator from Nevada some charts to back up other 
things he said: 22 million new jobs have been created under the 
Clinton-Gore administration. Is this something that is easy to do? 
Obviously, President George Bush couldn't do it. In his 4 years, he 
managed to create some 2.5 million jobs; President Reagan, 16 million 
under his 8-year period. But 22 million were created across this 
country in Clinton-Gore.
  There used to be a debate whether we value work. Since I was a little 
boy growing up in my family, work was important. You proved your mettle 
as a person by going to work. Now 22 million Americans have a chance to 
go to work and their chance to realize the America dream.
  Look at the inflation rate. This is the lowest level since 1965. 
Inflation being low means a lot of people can understand that their 
take-home pay is still worth a lot if it keeps up with inflation.
  In the bad old days, we had inflation rates in double digits. Now we 
are down to an inflation rate that is below 3 percent. People who are 
always left out in this equation are the poorest in America. We see now 
the lowest poverty rate in two decades was in 1999. It means basically 
we have not just helped those the best off in America, we have tried to 
help everybody. That means more job creation bringing more people off 
welfare, and our welfare rolls are the lowest they have been in modern 
memory. All these positive things have occurred. The question people 
have to face in the election on November 7 is basically the same 
election question Ronald Reagan posed many years ago: Are you better 
off today than you were 8 years ago? For the vast majority of Americans 
the answer is, overwhelmingly, yes. There is a fear, of course, unless 
we make the right decisions and elect the right leaders, we could 
jeopardize that situation.
  Look at Federal spending. I noticed George W. Bush goes around saying 
Al Gore wants to spend more and more at the Federal level, but this 
chart shows spending is moving in the opposite direction. Since the 
election of Bill Clinton in 1992, we have seen a steady decline of 
Federal spending as a percentage of our gross domestic product. Our 
spending is more effective. We are trying to do things that are 
important for America, and it has been evidenced in our economy and 
economic growth.
  Take a look a little more closely at the tax cut that would be 
happening here under the proposals we have seen from George W. Bush. We 
see basically the average tax cut for the lowest 20 percent of 
Americans ends up this year being worth about $18. If you happen to be 
in the top 1 percent, it is worth over $4,000. As you look at these, 
you understand this is a clear choice.
  I want to go back to one point made by the Senator from Nevada. I 
think it is an important one. Last week it wasn't the Democratic Party, 
it wasn't the Republican Party, it was the American Academy of 
Actuaries that analyzed the George W. Bush proposal for Social 
Security. This is a group that is supposed to know their business when 
it comes to analyzing what policy changes would mean.
  Here is what they said in their release of October 27: Bush's plan on 
Social Security would signal a return to Federal budget deficits around 
2015.
  How could that be good for America? How could it be good for us to go 
back to a deficit situation, adding to our national debt and drawing 
more money out of the economy to pay interest on it, raising interest 
rates, creating an inflationary spiral?
  They went on to say:

       Texas Governor George W. Bush's plan to cut taxes and 
     divert Social Security payroll taxes to establish individual 
     accounts would make it all but impossible to eliminate the 
     publicly held national debt.

  The PRESIDING OFFICER. The Senator asked to be advised when he had 10 
minutes remaining. There are 10 minutes remaining
  Mr. DURBIN. I thank the Chair.
  The program is a pay-as-you-go system, meaning most of the payroll 
taxes collected now are disbursed to recipients. We say, If we draw 
money out of Social Security, and we know we need to have it, how do 
you replace it? He was asked repeatedly in the third debate: Governor 
Bush, how do you replace the $1 trillion you take out of Social 
Security? He cannot answer the question because the hard answer to that 
question is the only way to replace it is to take one of three options: 
Reduce Social Security benefits; raise the payroll tax on Social 
Security; or somehow extend the retirement age beyond 67.
  I do not think any of those is a popular option. I hope we never have 
to face them, but if Governor Bush is going to propose massive changes 
in Social Security, then he has to face the music and explain it to the 
American people before the election.
  I would like to address a separate issue, but one equally important 
in this debate over the next President of the United States.

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