[Congressional Record (Bound Edition), Volume 149 (2003), Part 17]
[Senate]
[Pages 23432-23438]
[From the U.S. Government Publishing Office, www.gpo.gov]




                         RECONSTRUCTION OF IRAQ

  Mr. DORGAN. Mr. President, I have just come from a meeting to discuss 
the Appropriations Committee work beginning next week on the request 
from President Bush for $87 billion in urgent supplemental 
appropriations for Iraq. Of that $87 billion, roughly $66 billion is in 
support of the military and the mission in Iraq; $21 billion is for the 
reconstruction of Iraq. We will begin writing an appropriations bill in 
response to all of this next Tuesday morning at 10.

[[Page 23433]]

  I wish to bring to my colleagues' attention a couple of things with 
respect to this issue. First, when America sends its sons and daughters 
to defend our interests, when America puts its soldiers in harm's way, 
it has an obligation to provide the resources and funding needed to 
support their mission. I will support that. I will vote for that. I 
believe the Senate, the entire Congress will do that. But, there is a 
difference between providing the funding on an urgent basis for support 
of our troops to carry out their mission in Iraq and Afghanistan and 
the request for the reconstruction of Iraq. I want to describe that 
difference.
  Iraq is a country with substantial resources. It is not a country 
desperately impoverished. It is a country with 24 million people. It 
possesses the second largest oil reserves in the world. Ambassador 
Bremer told us this week that when pumping at capacity, by next July he 
expects the Iraq oil fields to be pumping at about 3 million barrels 
per day. That produces about $20 billion in revenue per year, $16 
billion of which is available for export; therefore, the development of 
currency as a result of the export sales of $16 billion a year of oil, 
each year, from the country of Iraq. This is not an impoverished 
country. This a country with substantial wealth under its sands. 
Pumping that wealth in the form of oil and selling it produces 
substantial revenue for the 24 million people.
  With respect to the question of the reconstruction, I want to go back 
to April of this year and to a ``Night Line'' program in which Ted 
Koppel had on one of the top folks in the Department of State who is in 
charge of the U.S. Agency for International Development, Andrew 
Natsios. He was asking Mr. Natsios about what would be required of the 
American taxpayers for the reconstruction of Iraq. I want to read this 
exchange because it occurred on the ABC television network 5 months 
ago.
  Ted Koppel says: You are saying that the top cost for the U.S. 
taxpayer will be $1.7 billion with respect to the reconstruction of 
Iraq?
  Mr. Natsios, one of the top officials in the Department of State, who 
heads the USAID which has the mission for projects for reconstruction: 
Yes, for the reconstruction. Then there is $700 million in the 
supplemental budget.
  He was referring to something we had done earlier this year for 
humanitarian relief.
  Koppel says: But as far as reconstruction goes, the American taxpayer 
will not be hit for more than $1.7 billion, no matter how long the 
process takes?
  Mr. Natsios: That is our plan. That is our intention.
  Koppel says: And these figures, outlandish figures I have seen, there 
is a bit of hoopla in all of this?
  Mr. Natsios says, in response to a question: That is correct. One 
point seven billion is the limit on reconstruction for Iraq.
  Natsios says: The rest of it is going to come from other countries.
  He says: We have arrangements with other countries.
  Then he names the other countries. He says: In terms of the American 
taxpayers' contribution for the reconstruction of Iraq, $1.7 billion. 
The rest of the rebuilding of Iraq will be done by other countries that 
have already made pledges--Britain, Germany, Norway, Japan, Canada, 
Iraq.
  He says: Eventually, in several years, when it is up and running, and 
there is a new government that has been democratically elected, they 
will finish the job with their own revenues. They are going to get $20 
billion a year in oil revenues. But the American part of the 
reconstruction for Iraq will be $1.7 billion. We have no plans for any 
further funding for this.
  That was this administration's spokesman said in April of this year.
  Well, 5 months later, we have a new request to the American taxpayers 
for almost $21 billion to continue the reconstruction of Iraq.
  Mr. Natsios said $1.7 billion. That is all. We have no plans for any 
other funding requests. Five months later, they are asking for another 
$21 billion.
  Let me tell you what my contention is on the $21 billion to 
reconstruct Iraq. My feeling is, rather than have the U.S. taxpayers 
provide $21 billion in grants to reconstruct Iraq, the revenue from 
Iraqi oil should be used to reconstruct Iraq. So I asked Ambassador 
Bremer about that.
  He said: Well, that is not possible.
  I asked: Why?
  He said: Iraq has a substantial amount of debt. They have a lot of 
debt. They have to repay this debt.
  I said: To whom does Iraq owe debt?
  He said: Germany and France and Russia.
  So after that hearing, I went and took a look at who Iraq owed money 
to. Well, guess what. The top of the list is not France, Russia, and 
Germany. At the top of the list is Saudi Arabia and Kuwait and the 
other Arab States, and then, yes, there is some owed to France and 
Russia and Germany, as well. But at the top of the list is Saudi Arabia 
and Kuwait.
  What the Ambassador was saying to me is we cannot use Iraq's oil to 
reconstruct Iraq. That oil is going to have to be pumped so they can 
sell it for cash and send money to Saudi Arabia and Kuwait. So we will 
have the American taxpayers pay some of their taxes so they can 
reconstruct Iraq.
  Sound perverse? It sure does to me. I think we should say to Saudi 
Arabia and Kuwait: You loaned Saddam Hussein money. Well, you loaned 
money to a government that doesn't exist anymore. You know that $50 
billion Saddam Hussein owes you, owed Saudi Arabia and Kuwait? Go find 
them and hand them a bill. It is not this country's obligation to bail 
out Saudi Arabia for debts that they allowed Saddam Hussein to run up 
with their countries. That is not our obligation. Iraqi oil ought not 
to be used to repay Saudi Arabia and Kuwait from money they loaned to 
Saddam Hussein. Saddam Hussein is gone. No one can find him. The Saddam 
Hussein government is out of power. It doesn't exist.
  So then the question is, How do you reconstruct this country? Well 
here is some of what American taxpayers are being asked to pay for: 
Forty garbage trucks, $50,000 each; $9 million to create a zip code for 
Iraq in the postal system; $54 million for technical and business 
process studies into a computer network for the Iraqi postal system; 
building seven new communities, 3,400 homes, including marketplaces, a 
church, and so on; two 4,000-bed prisons at $50,000 a bed. Well, that 
is just a start--fix some roads, fix up some electric grids.
  The interesting thing is that our ``shock and awe'' military campaign 
explicitly did not target Iraq's infrastructure. We didn't take out 
their power grid. We didn't do it because we didn't want to. We didn't 
destroy their dams or their power grid or the infrastructure of Iraq. 
Now we are told the infrastructure must be reconstructed. Why? Because 
guerrillas and insurgent movements inside Iraq have destroyed some of 
the infrastructure in Iraq, and because Saddam Hussein let it 
deteriorate for over 20 years.
  So the question is, What do we do in Iraq, and who pays for it?
  That is a long route to get to my central point. I don't believe it 
is the American taxpayers' responsibility to ante up $21 billion for 
the reconstruction of a country that has the capacity to borrow $30 
billion, repay it in 10 years at 6 percent interest, with $4 billion a 
year that comes from a $16 billion-a-year stream of revenue by pumping 
oil out of the sands of Iraq. Common sense? Sure. Maybe there are some 
who cannot see that, but I think the American people will.
  I have a September 2003 document. I guess it is 55 pages. It is the 
reconstruction plan for the country of Iraq. Let me say, I believe Iraq 
needs some reconstruction; there is no question about that. The 
administration makes the point that the quicker this economy gets up 
and moving, the quicker you have a vibrant set of opportunities in Iraq 
for the people, and the safer it will be for our troops. I agree with 
that. That is fine. But if you look at what they are asking the 
American people to create in the country of Iraq in these 55 pages, let 
me go through some of it: Private sector development, $200 million to 
establish an American-Iraqi enterprise fund to capitalize the 
enterprise fund to invest in a wide

[[Page 23434]]

array of private enterprises. This is sort of a venture capital fund of 
$200 million. Expand networks of employment centers, $8 million; on-
the-job training for private sector employment, $35 million; develop a 
program for computer literacy training in Iraq, $40 million; 
specialized computer training in Iraq, $15 million; English as a second 
language in Iraq, $30 million; modernize vocational training 
institutes, $25 million.
  I could go on and on for 50 pages. I understand why they want to do 
this. What I don't understand is why the American people are required 
to pay for this, when this country is a country that has the second 
largest oil reserves in the world and has the capability to produce the 
revenue to pay for it themselves. This makes no sense. It defies common 
sense.
  I am going to offer an amendment in committee next Tuesday, and I 
will offer it on the floor if it doesn't prevail in committee. I think 
we ought to do a couple of things. One, I think we ought to separate 
this issue and move the support for the troops immediately. I don't 
think anybody here wants to withhold whatever necessary support is 
requested to support the military. We sent them there; we have a 
requirement to support them with all they need to complete the mission.
  Second, I think we ought to separate the question of the 
reconstruction in the country of Iraq and go back to April of 2003, 5 
months ago, and the promise made to us and the American people by the 
head of the agency and the State Department that is going to do the 
reconstruction, Mr. Natsios, when he said our total obligation we are 
going to ask the American taxpayers to fund is $1.7 billion. Believe 
me, he said that is the total amount the American people are going to 
have to fund.
  Five months later, they came back and said: By the way, because Iraq 
owes money to Saudi Arabia and Kuwait, and Iraqi oil has to be pumped 
to pay debts to them, we want the American taxpayer to pay for basic 
infrastructure in the country of Iraq.
  I am telling you, there is something fundamentally flawed about that. 
I hope my colleagues on the Appropriations Committee will see the same 
thing. We are going to have a chance to vote on my amendment. It is 
going to be relatively simple. It says this: Let's fund the military 
request the President sent to us and do so quickly, and in a way that 
says there is no question about supporting the troops we have sent 
abroad. Second, here is the way we ought to reconstruct Iraq. The 
President is right. Iraq needs reconstruction, but he is wrong to ask 
the American taxpayers to pay for that. The way to reconstruct Iraq is 
to securitize the oil to be pumped in Iraq at 3 million barrels a day, 
beginning in July, according to Bremer, and use that securitization for 
Iraqi oil to repay the securities from that over the next 10 to 20 
years to reconstruct Iraq exactly as the administration wants it done. 
I don't dispute any of these needs. I don't take issue with the 
administration saying this ought to be done. I take very strong issue 
with the suggestion that somehow an administration that promised us 5 
months ago the total cost of reconstruction would be $1.7 billion, now 
says it is $21 billion in reconstruction, which ought to come from 
American taxpayers' funds, when we are dealing with the second largest 
oil reserves in the world.
  So we are going to have votes on this in the Appropriations 
Committee. We are going to have votes on it on the floor if it doesn't 
prevail in committee. I have been reading in the paper that some 
colleagues feel the same way on both sides of the aisle. They think 
this makes no sense to talk about $21 billion in grants from the 
American taxpayers to fund these issues. I hope some of them will join 
me and that we can do what is right, use a big barrel full of common 
sense on an issue like this, and help the American taxpayers and the 
Iraqi people at the same time and, most importantly, do what is 
necessary to support the American military who is trying to carry out 
this critical mission in that part of the world.
  God bless those men and women. We pray for their safety. We pray for 
their families. As we work through this next week, I hope there is a 
healthy dose of common sense in this Senate dealing with this 
reconstruction issue.
  I yield the floor.
  Mr. CONRAD. Will the Senator yield for a question?
  Mr. DORGAN. I would be happy to yield.
  Mr. CONRAD. The Senator has mentioned that the President has come 
before us and asked for $21 billion to reconstruct Iraq. In addition to 
that, the President is saying there is another $40 billion to $50 
billion of needs next year for the reconstruction of Iraq that is 
supposed to come from someplace else. The President and his people have 
said some of these other countries are going to contribute. Is the 
Senator aware of this additional $40 billion to $50 billion of money 
for reconstruction of Iraq that the President has identified?
  Mr. DORGAN. Mr. President, responding to the question, I am, and 
Ambassador Bremer made the same point as did Secretary Rumsfeld.
  There is a donor conference that is being held in Spain in just a 
matter of a couple of weeks. We have asked what is the proclivity of 
these countries to begin helping and donating. Here is what we were 
told: I believe it is 69 countries have donated $1.5 billion total.
  In this request, they are asking the American taxpayers for $21 
billion but say there will be a dramatic amount more that is needed but 
that is going to come from somebody else. It appears very unlikely it 
is going to come from anybody else. That is my point.
  The first step is I think this administration ought to work to have 
debt forgiveness with Saudi Arabia and Kuwait and others so they do not 
have that debt overhanging that country and then have that country's 
oil produce the revenue to reconstruct the country.
  This is not a desperately impoverished country. This is a country 
that sits on top of massive quantities of money in the form of oil, and 
yet we are being told the American taxpayers--who are already facing 
very large, staggering deficits, I might say--that somehow the issues 
of building dams, building prisons, building communities, doing job 
training, building hospitals, building health care facilities, building 
roads, all of that should be borne by the American taxpayer at a time 
when they have the capability to produce the revenue in Iraq to pay for 
all of that. This is inexplicable to me.
  As I said to my colleague, I hope we have a healthy dose of common 
sense that prevails on this question. Not on the military issue. I want 
some common sense there, too, but I do not want anybody to question 
whether we are going to support the military. We do.
  On reconstruction, we really need to go at this on behalf of the 
American people, in their interest. It is not in their interest to have 
to add this to the Federal debt and say to America's children, you pay 
for the reconstruction of a country that has oil to pay for its own 
reconstruction.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota.
  Mr. CONRAD. I thank my colleague for giving an excellent presentation 
and an excellent suggestion. This country has the second largest oil 
reserves in the world, and we are getting ready to have the American 
people rebuild that nation.
  There is something really wrong with the administration's thinking on 
this matter, to come before us and ask for $21 billion, to say there is 
another $40 billion to $50 billion of need in the next year and that 
they are going to get it from somewhere else, when the somewhere else 
has promised $1.5 billion. So there is a shortage of another $40 
billion. Where is that going to come from, and what is it being used 
for?
  My colleague from North Dakota pointed out what was in the Washington 
Post this morning, a detailed analysis of some of these expenditures. 
One that I found most unusual was $1 million per family in Iraq for a 
witness protection program for 100 families. That is $100 million--$1 
million a family. That is a pretty good deal. It is

[[Page 23435]]

going to be used to build prisons in Iraq for $50,000 a bed. Somebody 
is not thinking straight.
  They are going to create a ZIP Code, millions of dollars to create a 
ZIP Code; area codes for phone systems, millions of dollars paid for by 
American taxpayers. I do not think so. This in a country that has the 
second largest oil reserves in the world. As my colleague has pointed 
out, the reason we cannot use their oil money to rebuild their country 
is that they owe tens of billions of dollars to Saudi Arabia and 
Kuwait?
  Somebody has to have some common sense. We have to slow this thing 
down and think about what we are doing. I think the administration is 
kind of discombobulated. They are running around throwing out numbers 
they have not even thought through. That just cannot be what the 
response of the Congress is.
  In light of this request for $87 billion--and that is the tip of the 
iceberg, unfortunately. The fact is, it is very clear they are not 
going to get the $40 billion or $50 billion from anybody else and they 
will be right back asking for tens of billions of dollars more. That 
cannot be the response.
  Now, why not? First, it is not right. It is not fair. The American 
taxpayer should not be saddled with debts that are not ours. We already 
have our own debts. We have a runaway freight train of debt in this 
country.
  In light of the President's request for another $87 billion, I think 
it is time for us to go back to his State of the Union Address on 
January 28, 2003, when he said to us:

       This country has many challenges. We will not deny, we will 
     not ignore, we will not pass along our problems to other 
     Congresses, to other Presidents, and other generations.

  That is what he said to us. But look at what has really happened. We 
are doing precisely what he said we will not do. The debt of the United 
States, which will be passed on to future generations, which will be 
passed on to future Congresses and to future Presidents, is absolutely 
mushrooming out of control.
  The President told us just 2 years ago that in 2008 the debt would be 
virtually paid off. He said there would only be $36 billion left. Now, 
we know if we enact the President's policies, instead of virtually 
paying off the publicly held debt by 2008, which is the smaller part of 
the debt, it will be $6.2 trillion. How much is that? That is 6,200 
billion dollars. That is how much the debt is going to be by 2008, the 
point at which the President had told us we were going to have 
virtually paid off the debt. So the President was wrong, and wrong by a 
mile, on that assertion.
  The President told us:

       Tax relief is central to my plan to encourage economic 
     growth, and we can proceed with tax relief without fear of 
     budget deficits, even if the economy softens.

  He told that to us 2 years ago. But let's look at what we now know. 
What we now know is that instead of the assertion by the President that 
there were not going to be budget deficits, we have record budget 
deficits, the biggest in the history of the country, and by a country 
mile. The President's last proposal was reviewed by the Office of 
Management and Budget, and they tell us now that the deficit will be 
$535 billion next year.
  The previous record deficit was in 1992, when the first President 
Bush was in office, and the deficit was $290 billion. Now for next 
year, it is $535 billion. That is a record deficit. The President told 
us just 2 years ago it would not occur.
  Then the President told us the next year:

       . . . our budget will run a deficit that will be small and 
     short-term. . . .

  He told us the budget deficit would be small and short term. That was 
just a year ago. This is according to the President's own budget 
documents. This is what happens if his spending and his tax proposals 
are adopted. What we see is an ocean of red ink, and one that grows 
year after year. These are not small deficits, they are not short-term 
deficits, they are the biggest deficits we have ever had. And the next 
10 years is the budget sweet spot. They are the good times, according 
to the President's own analysis of his proposals. His own budget shows 
us that his plan is taking this country right over the fiscal cliff. 
This is what he says will happen to budget deficits. Not only are they 
not small, they are record. And they are not short term, they are 
endless.
  This is the President's analysis out to the year 2050, and there is 
no break in deficits anywhere here. It is deficits each and every year. 
We are in this part of the chart now, which shows the smallest 
deficits, and we know they are record deficits, the biggest deficits we 
have ever had in the history of the country.
  Next year alone, there is a deficit of $535 billion. The truth is, it 
is much worse than that because they are going to take $160 billion of 
Social Security money on top of that $535 billion of deficit. They are 
going to take every penny of Social Security surplus and throw that 
into the pot. So, on an operating basis, the deficit next year is 
really going to be $700 billion.
  The debt of the United States at the time Jimmy Carter was President, 
after 200 years of history in this country, was around $750 billion, 
and we are going to add that much or virtually that much in 1 year 
under this President's plan. That is not the most serious part. That is 
not the part that really worries this Senator. What really worries me 
is, that is the tip of the iceberg, according to the President's own 
analysis of his plans.
  He says, if you adopt his budget plan, his spending, his tax plan, 
that the deficits grow geometrically when the baby boomers start to 
retire. At the very time the baby boomers retire, the cost of the tax 
cuts explode, pushing us deep into deficit and debt, to levels never 
seen in the history of the United States. That is the plan the 
President is pursuing. It is a reckless plan and it is a dangerous 
plan.
  The President presented his budget for fiscal year 2004, and it said:

       Compared to the overall Federal budget and the $10.5 
     trillion national economy, our budget gap is small by 
     historical standards.

  First of all, there weren't going to be any deficits. That proved to 
be wrong. Then the deficits were going to be small and short term. That 
proved to be wrong. Now the President is saying, as a share of the 
whole national economy they are relatively small.
  The problem with that statement is it is wrong, too. It is wrong, 
too. The next chart shows how big these deficits are as a share of our 
national income. This chart goes all the way back to the end of World 
War II--just after the end of World War II. You can see the previous 
record deficit as a percentage of GDP was back in 1983--6 percent of 
gross domestic product.
  Next year, the deficit as percentage of gross domestic product is 
going to be 6.2 percent, if one excludes the Social Security trust 
funds from the calculation. So if you are looking at the budget on an 
operating basis, if you are looking at it as any private sector firm 
would have to look at its budget, what you see is the biggest deficit, 
as a percentage of gross domestic product, since World War II. And the 
President says it is relatively small. It is not relatively small, it 
is huge. It is the biggest it has been since World War II.
  Of course, what the President has left out is that the Social 
Security surpluses back in 1983 were virtually nonexistent. So when the 
President--the then-President--took those moneys, he wasn't taking 
much. But look at what has happened to the Social Security surpluses. 
They have been mounting dramatically, and now this President is taking 
every dime of Social Security surplus to pay the operating expenses of 
the country. No private sector firm would be able to do that. If you 
were in the private sector, you couldn't take the retirement funds of 
your employees and throw those into the pot to pay your operating 
expenses. If you did, you would be on your way to a Federal 
institution, but it would not be the White House. It would not be the 
Congress of the United States. You would be on your way to the Federal 
penitentiary, because that is a violation of Federal law.
  Yet that is what this President is doing this year and next year, 
taking every dime of Social Security trust fund surplus. And not just 
this year

[[Page 23436]]

and next year. Under the President's budget plan, he is going to take 
every penny of Social Security surplus this year and next year and the 
year after that and the year after that and the year after that and for 
the next 10 years. Every penny is being taken to pay the operating 
expenses of the Federal Government.
  This President is taking us down the road that is a fiscal disaster 
of the first order, and we had better start facing up to it. We are 
going to have an opportunity next week because the President has come 
before us and asked for another $87 billion--put it on the charge card. 
No, this $87 billion has to be paid for. We have to start getting back 
on track.
  The President, in his latest estimates, tells us that revenue as a 
percentage of gross domestic product is going to be at its lowest level 
since 1950. You will recall one of his major justifications for the tax 
cuts 2 years ago was that revenue was at a record percentage of gross 
domestic product. Now we are headed for a record low, in terms of 
revenue, and his answer is the same: Cut revenue more. It doesn't 
matter what the question is, the answer from this President, from this 
administration, is the same: Cut the revenue. If revenue is high, cut 
it. If revenue is low, cut it some more.
  It is not just a question of revenue being low, it is also a question 
of spending being increased. This chart shows, for this year, 92 
percent of the increased discretionary spending is in just three 
categories: Defense, which accounts for the vast majority of it; 
homeland security, which is the second biggest chunk; and the third 
biggest chunk is rebuilding New York and providing relief for the 
airlines, so badly affected by what has occurred. So we have not only 
the lowest revenue since 1950, we also have increased expenses for 
defense, homeland security, rebuilding New York.
  Of course, all of us support those increased expenditures in order to 
meet the obligations the country has taken on under this President.
  The President is fond of saying, ``It's the people's money.''
  This is a place where I agree with the President absolutely. It is 
the people's money, he is absolutely right about that. This is the 
people's money. But what the President has left out is that it is also 
the people's debt. What he is running up here is a debt that is truly 
massive in scope.
  This looks at the gross debt of the United States. Earlier we were 
talking about the publicly held debt. But if you look at the gross 
debt, not only what we owe those who have loaned money to the United 
States--which, by the way, includes a lot of money from Japan and 
Europe--we also see that we owe money to ourselves. We owe money to the 
Social Security trust fund that the President has been taking money 
from in order to float this boat. That is truly stunning.
  We have a gross debt of $6.8 trillion at the end of this year. But 
look at what is going to happen in the next 10 years. We are going to 
have a gross debt approaching $15 trillion. That is 15,000 billion 
dollars. That is real money. And all of this is happening at the worst 
possible time.
  Why the worst possible time? Because, as this chart shows right now, 
the green bar, which is the Social Security trust fund, the blue bar 
which is the Medicare trust fund, are running surpluses in anticipation 
of the retirement of the baby boom generation. Unfortunately, the money 
is not being used to prepare us for the retirement of the baby boom 
generation. The money is all being taken and spent on the operating 
expenses and to pay for the President's tax cuts. That is where the 
money is going. Not to prepare for the retirement of the baby boom 
generation.
  The red part of these bars is the cost of the President's tax cuts. 
What one sees is, when the trust funds go cash negative, which happens 
in the next decade--in fact, it begins to happen pretty soon because in 
2008 the leading edge of the baby boom generation starts to retire.
  Look at what happens when those trust funds go cash-negative at the 
very time the cost of the President's tax cuts explode, dragging us 
deeper and deeper into deficits and debt. This is utterly 
unsustainable. It is leading us to a crash landing.
  You don't have to take my word for it. Here is a report from the New 
York Times of September 14 reporting on the Congressional Budget 
Office's warning to all of us here in Congress. Let me quote from the 
New York Times:

       This course--

the fiscal course that the President has embarked upon--

     prompted the Congressional Budget Office to issue an unusual 
     warning in its forecast last month: If congressional 
     Republicans and the administration get their wish and extend 
     all of their tax cuts now scheduled to expire, and if they 
     pass a limited prescription drug benefit for Medicare and 
     keep spending at its current level, the deficit by 2013 will 
     have built up to $6.2 trillion.

  That is not the gross debt. That is the publicly held debt--$6.2 
trillion. That is 6,200 billion.
  They go on to say:

       Once the baby boomers begin retiring at the end of this 
     decade, that course will lead either to drastically higher 
     taxes, severe spending cuts, or ``unsustainable levels of 
     debt.''

  That is the course we are on. That is the course the President has 
put us on. It is a disastrous course by any judgment.
  Again, we have heard from the Congressional Budget Office.
  By the way, the head of the Congressional Budget Office used to be on 
the President's budget team, his Council of Economic Advisers. He came 
from the White House.
  You don't have to just listen to me or to him. Here is the 
Comptroller General of the United States, David Walker, in a speech on 
September 17 to the National Press Club. He said in that speech:

       The ultimate alternatives to definitive and timely action 
     are not only unattractive, they are arguably infeasible. 
     Specifically, raising taxes to levels far in excess of what 
     the American people have ever supported before, cutting total 
     federal spending by unthinkable amounts, or further 
     mortgaging the future of our children and grandchildren to an 
     extent that our economy, our competitive posture and the 
     quality of life for Americans would be seriously threatened.

  This is the Comptroller General of the United States put in place by 
the bipartisan leadership of Congress warning us that the course the 
President has us on is a disastrous course.
  We don't have to just listen to the head of the Congressional Budget 
Office, or have to listen to the Comptroller General of the United 
States. We just have to look at what has happened. We all can look and 
we can read reality tests. Does it make sense?
  Two years ago, the President told us we could have it all. The 
President said we could have massive tax cuts. He told us we could save 
Social Security and Medicare without touching the trust funds. He said 
we could have maximum paydown of the debt. He said we could have a big 
defense buildup. He said we could do it all. He was wrong. He was wrong 
by a country mile. He was wrong on each and every count--not protecting 
Medicare and Social Security. He is taking every dime of the Social 
Security trust fund surpluses for the entire rest of the decade.
  He said we wouldn't have deficits. We have record deficits. He said 
he would virtually pay off the debt. The debt is exploding. The 
President is taking us down a course that does not work.
  Most recently, he told us:

       It is important for you all to understand, for our fellow 
     Americans to understand, the tax relief I have proposed--and 
     will push for until enacted--will create 1.4 million new jobs 
     by the end of 2004.

  We are not at the end of 2004. So we can't make a judgment on that. 
But we can look back at 2001.
  In 2001, he made the same kind of claim. He said if you pass his 
plan, which we did, it was going to generate millions of new jobs.
  Wrong again. He hasn't generated millions of new jobs. He has lost 
millions of jobs--3.3 million jobs lost by August 2003 since this 
President took office. That is the worst record on jobs since Herbert 
Hoover. No other President of either party has lost private-sector jobs 
during their entire term since the Great Depression. This President has 
lost 3.3 million jobs with his economic plan.

[[Page 23437]]

  Once again, he is wrong--just wrong. He is just wrong in assertion 
after assertion after assertion. He is just wrong. That is the hard 
reality we have to cope with.
  If we look at this recovery that is underway--and there are signs of 
economic recovery, which one would expect--if you go and write $700 
billion of hot checks in a year on the Federal accounts, you expect to 
give some lift to the economy. By spending all of this additional 
money, all of these tax cuts, you would expect the economy to improve, 
and it is improving. But we are not seeing much pickup in jobs.
  We charted the last nine recessions which have occurred since World 
War II--the job recovery that occurred during the recovery from those 
recessions. Here is the trend line that we see: In each of those nine 
recessions, there has been a good pickup in jobs when the economy 
started to recover. Here is the pattern in this recovery. This is like 
a dead cat bouncing. Nothing is happening. Jobs are not being 
recovered. Jobs are still being lost, and the President told us he had 
a plan, he had a strategy that was going to bring back jobs--millions 
of jobs, he said. He was wrong.
  Now some are saying deficits don't really matter. It is really quite 
stunning to hear some of our Republican colleagues, who for years 
believed deficits did matter, all of sudden completely change course 
and say deficits don't matter. The Chairman of the Federal Reserve 
Board believes deficits matter. Here is what he said before the Senate 
Banking Committee:

       There is no question that as deficits go up, contrary to 
     what some have said, it does affect long-term interest rates. 
     It does have a negative impact on the economy, unless 
     attended to.

  Again, we didn't need to just listen to the head of the Federal 
Reserve Board. Hear what the head of the Congressional Budget Office 
said in testimony before the Budget Committee earlier this month. He 
said:

       To the extent that going forward we run large sustained 
     deficits in the face of full employment, it will in fact 
     crowd out capital accumulation and otherwise slow economic 
     growth.

  This is the testimony of Mr. Holtz-Eakin who was, again, put in 
office by the Republicans who control both Chambers, and came from the 
President's own economic advisors saying that deficits do matter. They 
do hurt economic growth in the long term.
  Again, I go back to the Comptroller General and his outstanding 
speech to the National Press Club on September 17.

       The ``bottom line'' is, there is little question that 
     deficits do matter, especially if they are large, structural 
     and recurring in nature. In addition, our projected budget 
     deficits are not ``manageable'' without significant changes 
     in ``status quo'' programs, policies, processes and 
     operations.

  I don't know exactly when this Congress is going to awaken to the 
threat that is barreling down on us, but we face a circumstance just as 
clear as it can be: The largest deficits in our history in dollar 
terms, by far. Deficits as a percentage of GDP fairly measured that are 
the largest since World War II and no relief in sight. Instead, 
deficits as far as the eye can see, massive deficits that are coming at 
the worst possible time, right before the baby boomers retire, right 
when we should be paying down debt or prepaying the liability.
  Instead, we are taking the money, hundreds of billions of dollars; in 
fact, over $2 trillion of Social Security surpluses alone over the next 
decade the President proposes taking to spend on other operations in 
government. That is $2.4 trillion of Social Security money, taking 
every dime. Not just this year, not just next year, but every year for 
the next decade.
  Two years ago the President told us we could expect nearly $6 
trillion in surpluses over the next 10 years. In just 2 years that has 
turned into $4 trillion, $4,000 billion of deficits.
  Where did the money go? Here is where it went: 39 percent went to the 
tax cuts the President proposed and pushed through Congress; 28 percent 
went to increased spending, largely, as I indicated earlier, defense 
and Homeland Security; 7 percent went to the economic downturn; 27 
percent in revenue shortfalls not associated with the tax cuts. So two 
thirds of the disappearance of the surplus in the move to deficits is 
on the revenue side of the equation. That is where the money has gone.
  Some are saying, we do not have to worry about this; we will grow our 
way out of it. Here is what the Comptroller General of the United 
States said, again in a speech to the National Press Club:

       [T]he consensus opinion at a recent meeting of prominent 
     economists representing a wide variety of ideological 
     viewpoints was that . . . ``we cannot simply agree our way 
     out of this problem.''

  It is time to face up to reality. It is time to face up to the fact 
we have again down a course that is not working. I am not casting 
aspersions on anyone's intentions or motivations. That does no good. 
But we can now look back at the President's record objectively and 
clearly. We can see that statement after statement he has made to this 
Congress was simply wrong.
  He said there would be no deficits. We have record deficits. He said 
they would be small and short-term. They are massive and unending. He 
said they are small as a percentage of our gross domestic product. They 
are the biggest they have been since World War II as a percentage of 
gross domestic product, fairly measured. The President said this would 
all create jobs. He said it would create millions of jobs. Millions of 
jobs have been lost.
  Now he says he needs another $87 
billion that he does not want to pay for. Where is the money going? We 
have heard a number of presentations this morning: 500 experts, at 
$200,000 each, to investigate crimes against humanity in Iraq. Let me 
repeat that. Here we are in the deepest deficit, in debt at the worst 
possible time, and the President says one of the things we should do is 
get us 500 experts at $200,000 each to investigate crimes against 
humanity. I am all for investigating crimes against humanity, but I am 
all against spending $200,000 each for 500 people in one year to 
investigate crimes against humanity in Iraq. Have we completely taken 
leave of our senses around here?
  He wants to build prisons over there at $50,000 a bed. He wants to 
have a witness protection program that will provide $1 million per 
family. Yes, it is there. Read the Washington Post: A witness 
protection program for families of five, 100 families of five, at 
$200,000 each in the family, five people, $200,000 each, and that is $1 
million for 100 families, for a total of $100 million. We do not have a 
witness protection program like that in this country.
  Let's get serious around here. We are in disastrous deficit and debt 
and we are talking about these kind of expenditures in a country that 
has the second largest oil reserves in the world, and we say, ``Just 
put it on the debt of the American people''? I don't think so. There 
has to be a better way.
  I yield the floor and 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. KENNEDY. 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. KENNEDY. Mr. President, we are in morning business?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. KENNEDY. I thank the Chair.
  Mr. President, early next week we will take up what has now become 
the defining issue of this session of Congress--the Bush 
administration's proposal for $87 billion for Iraq.
  I support our troops in Iraq. We all support our troops in Iraq. If 
that is the issue, the vote will be 100 to nothing in the Senate.
  The administration had an effective plan to win the war. The tragedy 
is that our troops are paying with their lives because the 
administration failed to prepare a plan to win the peace.
  Our troops performed superbly in the war. They are doing their very 
best under enormously difficult circumstances now. They deserve the 
full

[[Page 23438]]

support of Congress, and they will get it.
  But they also deserve a realistic plan from the administration. They 
deserve to know how the administration will bring in the international 
community, deliver on the promise of democracy, and bring our troops 
home with honor.
  The administration has refused to provide a realistic plan to the 
Congress and our troops. It has provided only a 2-month-old, 28-page 
plan called ``Achieving The Vision To Restore Full Sovereignty To The 
Iraqi People.''
  I would like to know why it is called a working document. I would 
like to know why the administration is asking the Congress to write an 
$87 billion blank check based on the draft plan.
  This is the draft plan. I will include it by reference rather than 
including all of it in the Record. It is 28 pages, including the cover 
page, ``Coalition Provisional Authority, Baghdad, Iraq, Achieving the 
Vision to Restore Full Sovereignty to the Iraqi People,'' dated July 
21. It is a working document that is the basis of the administration 
plan that was provided to the Armed Services Committee.
  I will read from the provisions in the plan on security from August 1 
to October 3, point 4: Locate and secure and eliminate WMD capability. 
Then November 3 to January 4: Continue to locate and secure and 
eliminate WMD capability. And then from February 4: Continue to locate 
and secure and eliminate WMD. Point No. 1: Defeat internal armed 
threats. That is August to October. November to January 4: Continue to 
defeat all threats. February 4: Continue transfer responsibility to the 
Iraqis.
  It is an insult to the American people. It is an insult to our troops 
who are paying with their lives. For most of us, when it comes to Iraq, 
there is a widening credibility gap between rosy descriptions of 
progress by the administration and the hard reality on the ground for 
our troops and for the Iraqi people.
  On September 14, Vice President Cheney said ``90 percent of the 
cities and towns and villages are governed by democratically elected or 
appointed local councils.'' He said that ``all the schools are open, 
and that all the hospitals are up and functioning.''
  In yesterday's Washington Post, Secretary Rumsfeld wrote glowingly of 
our ``solid progress'' in restoring Iraq. Yet we all know that the 
reality on the ground is quite different. And we are learning that 
there are even those within the administration who are reporting that 
things are not going well. Yet, those concerns are kept carefully from 
public view.
  In fact, the New York Times reported just last week on September 17 
that new intelligence reports conclude that ordinary Iraqis are turning 
against us. And Defense Department officials believe that ``indications 
of that hostility extend well beyond the Sunni heartland or Iraq, which 
has been the main setting for attacks on American forces.''
  We are still losing an American a day. After going it alone on the 
war, we have few allies to relieve our troops and join us in winning 
the all-important peace.
  Secretary Rumsfeld admitted this week that our failure to recruit 
sufficient foreign troops likely means additional callups for our 
reservists and guard units. General Abizaid told the Senate Armed 
Services Committee yesterday that ``it doesn't look like we'll have a 
coalition brigade. We have no choice but to plan for American forces.'' 
He is not counting on foreign troops. Clearly, the situation in Iraq is 
out of control. Our policies are not working. Our plan in Iraq is an 
$87 billion failure, and our troops are paying the price.
  The administration must admit that our plan is not working, that we 
cannot stay this course. We know it. The American people know it. Our 
allies know it. We cannot afford just to stay the same failing course. 
We owe our troops a change in plan.
  Before the Congress writes a blank check for $87 billion, we need to 
know that the administration has a realistic plan. Our troops who are 
paying with their lives deserve no less.
  I suggest the absence of a quorum.
  The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  The PRESIDING OFFICER. In my capacity as a Senator from South 
Carolina, I ask unanimous consent that the order for the quorum call be 
rescinded.
  Without objection, it is so ordered.

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