[Congressional Record (Bound Edition), Volume 149 (2003), Part 12]
[House]
[Pages 16224-16225]
[From the U.S. Government Publishing Office, www.gpo.gov]




            PRESCRIPTION DRUG PLAN NOT FAIR TO OUR CHILDREN

  The SPEAKER pro tempore (Mr. Garrett of New Jersey). Under a previous 
order of the House, the gentleman from Michigan (Mr. Smith) is 
recognized for 5 minutes.
  Mr. SMITH of Michigan. Mr. Speaker, I agree with the previous speaker 
on several issues, and that is that we should delay this bill and try 
to improve it. And I am going to make comments suggesting that it is 
not fair to seniors, but it is not fair to our kids and our grandkids. 
I have four children, and they are trying to save money to send my 
grandchildren to college. And one question I would pose is, why should 
they pay more taxes to pay for seniors' prescription drugs?
  The retiring seniors that we are going to see over the next 10 years 
are probably the wealthiest seniors this country has ever had in the 
past, probably will ever have in the future. Mr. Speaker, we now expect 
a vote on the addition of a prescription drug benefit to Medicare on 
June 26. And this vote would authorize the largest expansion of our 
entitlement programs since we amended the Social Security bill back in 
1965 and added Medicare. So Social Security, because of the allure of 
more senior votes, Members of Congress and the President decided to 
expand the benefits to seniors to add Medicare.
  When Medicare was under consideration in 1965, a few Members realized 
the sort of burdens that would come to place on future taxpayers, and 
Chairman Wilbur Mills of the House Committee on Ways and Means 
predicted in September of 1964 that the costs of even part A of 
Medicare, which was then under consideration, would soon exceed 
projections and that ever-increasing taxes would be needed to finance 
it. He predicted it would come to pass that Medicare costs would leave 
Congress hamstrung, facing uncontrolled increases in costs and to the 
indefinite future. Mills dropped his opposition to Medicare under 
pressure from the President of his own party, but he was right about 
the program's consequences.
  This summer, as Congress considers the largest single expansion of 
any entitlement program since 1965, we should consider how a 
prescription drug benefit will burden future workers and taxpayers and 
not give seniors what they expect. The Federal Government is in serious 
financial problems. When the baby boomers start retiring in the next 10 
to 12 years, we see more people going out of the workforce, if you 
will, paying in to Social Security and taxes and taking out benefits 
from Medicare and Social Security.
  When the Federal Government comes to a pinch in another 12 to 15 
years, guess what is going to happen to the prescription drug program 
that has been promised? Number one, I suggest that government, Congress 
and the President will say, well, to reduce costs, we need to spread 
the costs over a wider segment of the population, and so we are going 
to require all seniors, regardless of whether you have prescription 
drugs in your retirement program or not, regardless of whether you have 
a good insurance program that covers prescription drugs, we are going 
to require everybody to take the government's system.
  Guess what comes next as government faces this fiscal pinch? 
Rationing, and then the government will follow what many other 
countries have done such as Canada and many other countries that have 
government-run programs. They are going to say, well, we are going to 
limit the prescription drugs that are available to seniors. This 
proposal suggest that $400 billion, and it is pretty much used up, is 
going to be required for spending in the next 10 years for prescription 
drugs. We should think carefully about the consequences of making a 
whatever-it-costs commitment into the indefinite future.
  I chair the Subcommittee on Research in Science and the medical 
technology is now expanding more rapidly than our ability to pay for 
it. That means the medical technology of the future is going to be very 
impressive and very successful on maintaining our health and helping us 
to live longer. In fact, the future has suggested that in the next 20 
years, anybody who wants to live to be 100 can do so, but it will cost 
money. And we are sort of programming that we will pay for those 
benefits, whether it is $40,000 a treatment or $60,000 a treatment 
after they finish their first deductible and the 3,000 or whatever we 
end up with. And that is another question, none of us have read this 
bill yet.
  It now looks like a bill we will consider this week will add 
prescription drug benefits with minimum offsets for Medicare. It is not 
fair to our kids to add this responsibility to everybody else's kids 
and grandkids and my 10 grandkids, and I would hope we look more 
carefully at this and review it over the Fourth of July recess and come 
back and try to have a better bill.
  This will add enormous liabilities to a Medicare system which is 
already predicted to be insolvent. Economists calculate that the newly 
created unfunded liability of such a reform is $7.5 trillion. This 
means that a prescription drug bill that adds 12 percent to Medicare's 
costs comes with a present cost of $7.5 trillion, or a bit more than 
the entire public debt. You add this to an unfunded liability of $9 
trillion for Social Security and you end up saddling our kids with a 
huge debt.
  These projections assume that prescription drug costs will grow at 
the same rate as the rest of Medicare, and that the prescription drug 
benefit will not be expanded over time. Recent history would suggest 
that prescription drug costs are growing more rapidly than the rest of 
Medicare. In 1965, OMB projected that Medicare would spend $9 billion 
in 1990. The actual figure was $67 billion. Having projected $26 
billion in spending for 2003, we will spend $245 billion. Because 
medical technology--the cost of prescription drugs will be much higher.
  This drives home the point that any expansion of Medicare imposes a 
cost on taxpayers. Such a reform basically transfers the burden from 
retirees to taxpayers. More accurately, it means that we are 
transferring costs from us to our children and grandchildren. We're 
spending now and sending the bill to people

[[Page 16225]]

who are yet to be born or too young to defend themselves.
  This is selfish and it is wrong. I'm not against a prescription drug 
benefit if it is responsible. But it must not place heavy and 
increasing burdens on workers, taxpayers, and the economy in the 
future. I oppose the bill that is now under consideration because it 
does not meet this test.
  Once again, we have not had an opportunity to see and review a bill 
on an important topic before we are required to vote on it. It is 
rumored, in fact, that changes are still being made. Few members will 
actually know exactly what's in this bill until after it has passed.
  I believe that the better approach would be to release the bill 
tomorrow and then delay the vote until after the upcoming Fourth of 
July work period. That would allow all of us in Congress to read the 
bill, consult with our constituents, and make a fully informed decision 
on a program that could profoundly affect our future and that of our 
children and grandchildren.
  I urge Congress to reject the bill tomorrow so we can take a more 
responsible and deliberate approach to reforming an important program 
like Medicare.

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