[Congressional Record (Bound Edition), Volume 151 (2005), Part 7]
[House]
[Pages 9107-9114]
[From the U.S. Government Publishing Office, www.gpo.gov]




   CORRECTING AMERICAN FISCAL PROBLEMS AND PRESERVING SOCIAL SECURITY

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 4, 2005, the gentleman from Florida (Mr. Meek) is recognized 
for 60 minutes as the designee of the minority leader.
  Mr. MEEK of Florida. Mr. Speaker, once again, it is an honor to come 
before this House of Representatives. I can tell you that this 30-
Something Working Group, Mr. Speaker, that our Democratic leader, the 
gentlewoman from California (Ms. Pelosi), has designated this time 
every week for the 30-Something Working Group to come to the floor to 
not only speak to the Members but also have an opportunity to share 
good information in general with the American people, and that is why 
we are here, to represent them, Mr. Speaker.
  I want to say, in the last several weeks, we have been talking about 
the issue of Social Security. I can tell you that Social Security is 
not only at the forefront of the agenda in this Congress but also has 
been promoted throughout this Nation as being in a state of crisis, 
which it is not.
  So, tonight, the 30-Something Working Group, we have asked a member 
of our caucus to come, the ranking member of the Committee on the 
Budget, the gentleman from South Carolina (Mr. Spratt), to come to talk 
to us a little bit about this double whammy that the American people 
will be going through because of the push of privatization of Social 
Security and the irresponsible spending by the majority side and also 
by the present administration.
  This whole debate is about helping future generations. This whole 
debate is about making sure that we keep our end of the deal to the 
American people. I can tell you, keeping our end of the deal to the 
American people is saying we are going to do what we said we are going 
to do from the beginning, Mr. Speaker, and it is important. But I 
believe when misinformation or inaccurate information is given to the 
American people and to some Members of this House, it jeopardizes our 
commitment to keeping our end of the deal.
  What I mean by ``our end of the deal,'' for those individuals that 
have paid into Social Security over the

[[Page 9108]]

years, and they are looking forward to the security of Social Security 
being there for them at the benefit level to where it is now, I think 
it is very, very important that we do not let those Americans down.
  I want to make sure that not only the Members of this House but 
everyone understands that Social Security will be solvent for the next 
47 to 50 years at the present benefit level of where it is right now. 
Forty-eight million Americans who need the survivor benefits, retirees 
or individuals eligible for Social Security at this point will receive 
100 percent of the benefits they are receiving now. On average, they 
receive $955 of monthly benefits from Social Security. Thirty-three 
million Americans are retired that are in that 48 million, and a large 
number of those Americans would be living under the poverty line if it 
was not for Social Security. So when we start talking about 
privatization of Social Security, it is a very dangerous thing and 
something that we should not play around with at all.
  I am proud that Democrats on this side of the aisle, and I would even 
say some of my Republican friends, believe in strengthening Social 
Security without slashing benefits that Americans have earned and 
making sure that private accounts are not a part of the Social Security 
debate or reality, because there is strong evidence, not hearsay, 
strong evidence of major benefit cuts to Americans that are counting on 
Social Security.
  I think it is also important, Mr. Speaker, that the Members 
understand that, once we can get to the point that we stop insisting on 
private accounts, when it really does not add up for the individual 
that is receiving Social Security or that will receive Social Security, 
I think we can get on to not only a serious discussion but action in 
dealing with the question of Social Security.
  We should not increase the debt by some $5 trillion and gamble on the 
future of Social Security. I think the American people deserve better. 
I think the American people demand better, and I think the American 
people will continue to pay very close attention to what is being said 
and what is not being said in this discussion about Social Security.
  I do not believe that Members of this House or the other body will 
take a vote where they are going to make a career decision on a gamble 
on Social Security privatization. It is not at that point to where one 
has to gamble with the retirement of so many Americans. Social Security 
is there to make sure that it is a guarantee for men and women that 
have worked in this country.
  So, tonight, we are going to talk about the budget, the $26,000-plus 
that every American owes to the Federal debt, and tonight, we are going 
to, if I could use the word, cross-pollinate, Mr. Speaker, Social 
Security privatization philosophy and the reality of the ever-growing 
deficit, that it seems that this Congress is out of control of 
continuing to add on to the debt without any plan whatsoever, no real 
realistic plan, in making sure that we take down the debt for future 
generations. So I think that is very, very important.
  Now, some individuals will say, Well, what is the Democratic plan? 
Well, I would like to know what is the Republican plan? Some of my good 
friends in this Chamber are Republicans and want to know the Republican 
plan.
  I would say, the Republican leadership plan, because I do not want to 
generalize, because I feel there are Members in this Chamber that have 
a genuine argument and concern when they see statistics that are given 
by notable organizations and even by some of our Federal Government 
organizations that are saying that there going to be major benefit cuts 
if we go to privatization, to the point that where even individuals who 
do not enroll in private accounts are going to receive cuts. That is 
not fair.
  So that is the reason why we come to this floor, week after week, the 
30-Something Working Group, along with others, to be able to talk about 
this issue.
  Now, tonight only are we going to have the gentleman from Ohio (Mr. 
Ryan), who is always here, Mr. Speaker, and Ms. Wasserman Schultz, and 
we have one of our 30-Something Working Group members, the gentleman 
from the Great State of Alabama (Mr. Davis), who will come before this 
great House to be a part of this discussion, along with our ranking 
member on the Committee on the Budget, the Democratic ranking member of 
the Committee on the Budget and a part of the Democratic leadership 
team in dealing with the issue of the deficit and the budget and 
responsible spending and also making sure that we do the right thing.
  I would like to yield some time to the gentleman from South Carolina 
(Mr. Spratt). As you go to the well there, I want to just let you know 
how much I appreciate not only the hard work that you have been doing 
but the fact that you have joined us here, the 30-Something Working 
Group. I know you have been really given to not only the Democratic 
Caucus but informing the Congress on what we are doing and what we are 
not doing.
  I would like to say to the distinguished gentleman from Alabama (Mr. 
Davis), feel free to be part of this, also a member of the Committee on 
the Budget.
  Mr. SPRATT. Mr. Speaker, I thank the gentleman for yielding. Let me 
say, I enjoyed serving here with your mother, and she has every right 
to be proud of the service her son is rendering here. He was well 
raised.
  The young in this country, and you fellows are young by my reckoning, 
have a right to be concerned about the course that our government, the 
Federal Government, is taking under President Bush. Obviously, we have 
a huge problem with our own budget, our budget deficit.
  President Bush enjoyed an advantage that practically no President in 
modern times has enjoyed. He came to office with a surplus that his 
economists projected to be $5.6 trillion between 2000 and 2011, over a 
10-year period of time, an unprecedented surplus.
  It was not just a projected surplus. The year before the year 2000, 
the last fiscal year of the Clinton administration, the United States 
Government ran a surplus of $236 billion.

                              {time}  2000

  That was the context, the fiscal context in which President Bush came 
to office.
  Today, when we closed the books on September 30, 2004, that fiscal 
year, we had a deficit of $412 billion. OMB is still predicting a 
deficit this year, even bigger. But CBO has some good news. They tell 
us that revenues are coming in at a faster clip; and they are hopeful 
that deficit will be coming down to $350 billion. But $350 billion is 
only something to cheer in the context of deficits that have been 
running at a level of $412 billion, the highest level deficits in our 
history, and we went there in just 5 short years.
  What we are effectively doing, I say this to the young people of 
America whom my colleagues represent, is leaving our children and 
grandchildren the tab for fighting a war, letting them pay for the 
lion's share of it by simply adding it to the national debt. We are 
adding to national entitlements. We are cutting taxes, above all, and 
then borrowing to pay for the revenues we give up by the tax cuts and 
letting our children pick up the tab, pay the bill.
  I often go to civic clubs; and I tell them, there is clearly a fiscal 
problem for the United States Government's budget, because the more we 
borrow, the more interest we have to pay and, pretty soon, debt service 
begins to eclipse accounts in the budget, like education, that are 
critically important. But in addition to that, this is a moral problem. 
It is a moral problem when we shove these mountains of debt off on to 
our children and grandchildren. That surely is what we are doing.
  Quickly, let me just show my colleagues what we have here. This 
chart, which has its own mountains, shows us where President Clinton 
started in 1993, at a deficit of $290 billion. On the floor of this 
House, by one vote, we passed the Clinton budget in 1993, one vote; and 
every year thereafter the bottom line of the budget got better, better 
and better, to the point where we

[[Page 9109]]

had, as I mentioned a minute ago, a surplus of $236 billion in the year 
2000. Since the election of Mr. Bush in 2001, the budget has gone down 
and down and down every year; the bottom line of the budget has gotten 
worse to the point where we had a record deficit of $412 billion last 
year.
  Now, the Committee on the Budget and President Bush both tell us we 
have a plan. We have a plan that will cut that budget deficit in half 
over the next 5 years. Well, we can cut a budget deficit in half when 
we leave out some of the biggest items that we are likely to face over 
the next 5 years.
  One of those is the cost of eventually dealing with the alternative 
minimum tax. More and more taxpayers are having to pay the AMT instead 
of the regular tax; and when that problem is finally fixed, it will 
have to be politically an inevitability, because it will, by 2010, 
affect 30 million tax filers. We will have to fix it. CBO says the 10-
year cost in revenues lost to fix the AMT so that it only applies to 
the upper bracket taxpayers for whom it was intended is $642 billion in 
lost revenues.
  Then there is the cost of our troops in Afghanistan and Iraq. We just 
passed an $82 billion supplemental. There is not a dime in the 
President's budget after 2005 for the cost of those troops; and CBO, 
the Congressional Budget Office, has said we need to have some kind of 
national estimation of what it is likely to cost to keep those troops 
there, assuming that they will be gradually redeploying. So they said, 
let us assume that there will be 40,000 troops, 20,000 in Afghanistan, 
20,000 in the theater around Iraq for the next 6, 7, 8 years. Their 
calculation is $384 billion. That cost is left out of the President's 
budget.
  So major items have been left out. We have gone back and put in items 
that are not contentious, not controversial, but politically realistic; 
and we can see from this chart that the deficit does get a bit better, 
because the economy gets better; but 10 years from now, we have a 
deficit of $621 billion; $621 billion.
  Mr. MEEK of Florida. Mr. Speaker, I think it is important not only 
that the Members understand, but the American people also understand. I 
mean, the gentleman is the second most senior member on the Committee 
on Armed Services; and I think that the gentleman is in the right 
position on the Committee on the Budget, that this is Iraq, the early 
years. I mean, this is going to be a long-term commitment of the United 
States. We are there; we are going to be there for some time. The 
coalition is getting smaller. We need to make sure that we provide for 
these men and women and their families back here.
  So I just wanted to say that so that the Members understand that we 
have an overall responsibility, but some of the things that the 
gentleman is showing us here on this chart of the realities that are 
obviously coming in the future and, on top of that, the Social Security 
issue, is going to be a train wreck in the making, if not already 
there.
  Mr. SPRATT. Mr. Speaker, we can see it coming down the track. This 
chart depicts it as graphically as we can make it. The deficit never 
rises below, never falls below $350 billion, and rises to $621 billion. 
Tally that up and we will see a mountain of debt added over the next 10 
years, and then we have to pay debt service, we have to pay the 
interest on that debt; and that debt service begins to encroach upon 
other necessities, other critical priorities of the government like 
education, like health care.
  So this is why we are concerned, the gentleman and I, and we, we are 
leaving to the next generation this legacy of debt. Surely, surely this 
generation of Americans, like every generation, which has strived to 
leave their children a better life, a better world, a better economy, 
does not want to be remembered for leaving our children and 
grandchildren a mountainous legacy of debt; but that is the course we 
are on right now.
  Let me stop there so that we can yield to the gentleman from Alabama 
(Mr. Davis).
  Mr. DAVIS of Alabama. Mr. Speaker, I thank my colleagues for yielding 
to me. Let me begin by thanking my colleagues and my friend, the 
gentleman from South Carolina (Mr. Spratt), the ranking Democrat on the 
Committee on the Budget. The gentleman from Florida (Mr. Meek) and I 
have only served with the gentleman from South Carolina (Mr. Spratt) in 
the Congress for a very short period of time, but the gentleman has 
been such a stalwart on this issue during the time that we have been in 
Congress.
  This is not a subject that necessarily just jumps out at people as an 
exciting or sexy subject, but it is so important to our country to talk 
about the problem and the consequences from our debt and our deficit. 
There is no one who has been more of a stalwart in this institution 
than the gentleman from South Carolina, and I certainly thank him. As 
well, I welcome the person who will follow me tonight, the gentlewoman 
from Florida (Ms. Wasserman Schultz) who has, in a very short period of 
time, just since January, already distinguished herself as one of the 
ablest and most intelligent Members of this institution; and we are 
thankful to have her here this evening.
  I know that the gentleman from Florida (Mr. Meek) was in my district 
very recently, in Selma, Alabama, with me during March of this year 
when we commemorated the march across the Edmund Pettis Bridge; and the 
day after that march, I had a town hall meeting in that same city, 
Selma, and the purpose of the town hall meeting was to talk about 
Social Security and our country's future. There was a moment at the end 
of the town hall meeting that I want to share with the Chamber of that 
night, because I think it is so illustrative of the challenge that we 
are facing.
  There was a young woman who was about 19. She said she was a college 
freshman, and she stood up and she asked me and the panelists a 
question, and her question was something like this: she said, young 
people today, and younger workers today are paying into a Social 
Security system that may not be around or may not be around in its 
current, robust form for us young people. So she asked the question, 
why do we have to pay at all? Why do we as young people, she said, have 
to even pay into a system that may not be there for us?
  When I heard that young lady make those comments, two things occurred 
to me. The first one is that we have fallen a ways in this country if 
our young people today are full of cynicism and not idealism; if our 
young people today are wondering why we have to meet our burdens 
instead of wondering why we cannot meet greater burdens, something has 
happened to us that is wrong.
  There was another thing that occurred to me.
  Sometimes I think in this Chamber we have the illusion that we are 
arguing about money. We have the illusion that we are arguing about 
line items in a budget, that we are arguing simply about techniques of 
accounting. That young lady's comment made me realize we are arguing 
about something far more fundamental in this Chamber every day, and I 
would define it this way: exactly what do we owe each other? Are we 
obligated to each other, or are we cut off from each other's common 
destinies? That is what this political debate is about, and I hope that 
is what the American people understand this debate to be about.
  As we saddle future generations with debt, as we saddle future 
generations with the consequences of tax cuts that we could not afford, 
as we saddle future generations with our mistaken fiscal choices, it is 
a retreat from the politics of obligation; it is a retreat from the 
idea that we are connected to each other and each other's fate and each 
other's destiny.
  Increasingly what I fear is that we are entering a world where the 
only morality that we recognize in our public space is the morality of 
the marketplace. The gentleman from South Carolina touched on that. He 
talked about morality, and that word should not be in any way omitted 
from this conversation, because the morality of the marketplace is a 
very narrow morality. It says that to whom much is given,

[[Page 9110]]

much will continue to be given. It says that the strong shall have the 
opportunity to get stronger, and it says that other than a little bit 
of sympathy and a little bit of charity for which we get a tax write-
off, we do not owe a whole lot to the other people in our society.
  I think that if we are to be true to the legacy of this institution 
and true to the people in this country, that we need a broader public 
morality than this narrow morality of the marketplace. We need a public 
morality, a way of talking in the public square about what we owe each 
other, what we owe our veterans, what we owe our young people, what we 
owe our working families, what we owe our college students, what we owe 
our disabled workers, what we owe all of the people who may not sit in 
the circle of prosperity today, but who desperately want to do so and 
want to have a chance to sit there tomorrow.
  The budget resolution that we voted on 2 weeks ago and, essentially, 
we voted on it 2 months before that, because it did not change a lot 
from the House version to the final resolution passed by both Houses, 
it is a document that I think does not meet our best moral impulses; it 
does not meet our best impulses about what we owe each other as a 
community.
  The gentleman from South Carolina and others have detailed on this 
floor and elsewhere the cuts to veterans, the cuts to our young people, 
the cuts to all kinds of commitments and obligations that we have to 
our environment, to our workforce development system in this country; 
but once again, the stakes are broader. Because what this budget does 
is to slowly but surely begin to walk away from the idea of national 
commitment and national obligation. It slowly but surely begins to walk 
away from the idea of community.
  I make these final two sets of points before I yield to the 
gentlewoman from Florida tonight. I happen to think that we do have an 
obligation to get our fiscal house in order; there is no question about 
that. We cannot sustain these deficits; we cannot sustain this debt. It 
is unconscionable the President wants to add to it with his Social 
Security plan. It is unconscionable that the President does not have a 
long-range plan to pull us back from deficit.
  But this is what is the real moral rub, I think, for a lot of us. So 
often in the last 4 years, the Bush administration and our friends and 
colleagues on the other side of the aisle, the Republican side, have 
asked sacrifice, but they only do it of some of the people. John F. 
Kennedy, whom I admired greatly, and whom I know the mother of the 
gentleman from Florida (Mr. Meek) admired and whom I know you admired a 
great deal, when he was inaugurated, he spoke on the idea of sacrifice 
and the idea of common burden and obligation. He did not speak of a 
sacrifice that falls only on working families who need Medicaid in 
Tennessee and Mississippi and Alabama. He did not speak of the 
sacrifice that falls only on veterans whose premiums do not need to go 
up. He did not speak of a sacrifice that falls only on families who are 
needing section 8 housing and do not want the program gutted. He did 
not simply speak of burdens and obligations that fall on the weakest of 
us.
  I listened to the discussion that happened in the hour before us 
tonight, and the eloquence of the gentleman from Illinois (Mr. Emanuel) 
on who has power in this Chamber, who has power in this institution. It 
is increasingly the most well-off among us, the most narrow-minded 
among us who are committed to a very narrow pursuit of the private 
interest. That is a full-scale retreat, with guns blazing, from the 
idea of what we owe each other as a people and as a community.
  So if our country is going to move forward, I say to the gentleman 
from Florida, and if we are going to move forward and become what I 
think that we can be, we have to return to this idea that we do owe 
each other something more than sympathy, that we do owe each other a 
commitment to building a financial future that will work for our 
children. We owe each other a commitment toward a true and enduring 
retirement security for our seniors. We owe our young people a 
commitment and an investment in their skills; and, finally, we owe our 
country a way of talking about politics and a way of talking about our 
expenses and our expenditures, a conversation and a dialogue that 
somehow draws us together.
  The final point that I will make tonight is, and so often I see this 
when I go back to town hall meetings in my district, last night I was 
in Choctaw County, Alabama in Butler, and so many people are frustrated 
when they see us arguing about things that do not matter to them.

                              {time}  2015

  We have been here for 4 months, and we have had a pretty busy 
schedule. We have voted on all of probably one really truly important 
piece of legislation this year, and that was the budget. We have had a 
lot of distractions, and we will keep having distractions on the floor.
  But the people are so frustrated that we are angry at each other over 
things that do not matter in their lives, and they want us to repair to 
a higher standard. So I thank the gentleman from Florida (Mr. Meek) for 
being here tonight. Again, I thank the gentleman from South Carolina 
(Mr. Spratt) for his leadership and his wisdom. And I would be happy if 
the gentleman from Florida (Mr. Meek) will yield to my good friend, the 
gentlewoman from Florida (Ms. Wasserman Schultz).
  Ms. WASSERMAN SCHULTZ. Mr. Speaker, first, let me say what a pleasure 
it is to have the gentleman from South Carolina (Mr. Spratt) join us 
for our 30-something working group. I have to tell you, as the freshman 
in the group, and the person who has been here for the shortest tenure, 
one of the most incredible experiences I have had is to have the 
opportunity to learn from the gentleman from South Carolina (Mr. 
Spratt) and especially the inner workings of the budget and to be able 
to absorb the expertise, at least attempt to absorb the expertise that 
the gentleman has been able to provide this country with your 
leadership. So I cannot thank the gentleman enough for that.
  And I really want to pick up on what the gentleman from Alabama was 
saying because this really is, the budget is a statement of our values. 
It is our values versus the Republican leadership values. And it really 
is probably the most comprehensive expression of the direction that we 
believe the country should go in and the priorities that we have in our 
caucus versus the priorities that they have.
  And, you know, it is interesting, look at the group of us assembled 
here tonight. I do not think that you could have a more eclectic group 
of Members than the Members assembled here. I represent a district, 
Miami Beach, Ft. Lauderdale and Hollywood. The gentleman represents 
Alabama. The gentleman from Florida (Mr. Meek) and I share communities. 
And the gentleman from South Carolina (Mr. Spratt) represents, you 
know, a district in South Carolina. The gentleman from Ohio (Mr. Ryan) 
is here with us tonight. We could not have more diversity in our caucus 
and more diversity represented here tonight.
  And if you look at the homogeneity on their side of the aisle, even 
when they do not have homogeneity in their caucus, they walk in lock 
step. They fall in line. They do what they are told. And that is 
regardless of the fact that they have crafted a budget that clearly 
says to the American people: We do not care. We do not care about you. 
We do not care about making sure that your children have a quality 
education. We do not care about making sure that if your child is sick 
that you can afford to take them to the doctor. They have engaged, at 
least since I have been here and that I have been able to note, in 
slash-and-burn politics.
  I mean, the thing that I think is the most interesting is that, over 
the time that I have been involved in public service, you know, we are 
constantly trying to figure out, and the American public, people, I 
think, are trying to figure out, how do you define a Republican, and 
how do you define a Democrat?
  And I think that the budget document that they have put forward is

[[Page 9111]]

probably the best expression of how you define what it means to be a 
Republican. And clearly, what it means to be a Republican is to balloon 
the deficit, cause the Nation to go further and further into debt, 
mortgage our children's future, cut health care, cut education, both in 
the lower grades as well as student loans.
  And if you look at our budget document that the gentleman from South 
Carolina (Mr. Spratt) put together, it also is an expression of our 
values and the direction that we would take the country. Our budget 
document, as crafted by the gentleman from South Carolina and the other 
Budget Committee Members would bring the budget into balance by 2012. 
It would make sure that we do not cut the programs that are the most 
important to the American people.
  What are our priorities? Education, health care, making sure that we 
can improve the quality of people's lives and making the world a better 
place as opposed to improving the bottom line of the pocketbooks of the 
wealthiest Americans. I mean, that is essentially what the ultimate 
goal was, clearly, of the Republican budget document. And I think it is 
important that we help lay that distinction out in front of the 
American people so that, over the course of the next 18 to 22 months, 
they can make a decision as to whether we want to continue to move in 
the radical direction that they are taking this country or if we want 
to get things back on track.
  Mr. MEEK of Florida. I thank the gentlewoman from Florida (Ms. 
Wasserman Schultz). I thought the gentlewoman and the gentleman from 
Alabama (Mr. Davis) shared some really good comments.
  I see that the gentleman from South Carolina (Mr. Spratt) has a board 
there that he wants to share with us, and I know the gentleman has some 
comments based on our comments.
  Mr. SPRATT. We have a number of different deficits. One is the Social 
Security deficit. The actuaries at the Social Security Administration 
tell us that the shortfall in Social Security funding over the next 70 
years is $3.7 trillion.
  What Mr. Bush is now proposing as a purported solution to that is to 
allow workers to divert 4 percentage points off their payroll tax, one-
third of their payroll taxes into private or personal accounts and away 
from the Social Security trust fund. This will have enormous 
consequences.
  First of all, everyone can see that it is counterintuitive. If you 
have got a trust fund which is $3.7 trillion, do you resolve that 
problem by diverting a third of the revenues away from that fund, so 
that you virtually double, and then some, the shortfall in the account?
  That does not square with anybody's understanding of how to resolve 
this problem. But it is of particular concern for younger Americans, 
because they will be paying substantial sums into Social Security, and 
they may get, unless the reform being discussed is done differently 
from what the President proposes, the worst they will get out of Social 
Security. Thus far, Social Security, every generation would say, has 
been a success story. It has made the fabric of America a better 
country, a better society.
  A lot of young people walk up to me, I would say to the gentleman 
from Florida (Mr. Meek), and they say: I do not ever think I will see 
my Social Security or at least nothing like what is promised to me. I 
am paying in big bucks, 12.4 percentage points of my gross income, 
after accounting for what my employer also pays. And I do not ever 
think I will see what I am contributing come back to me.
  And I tell them all, Social Security is not just a retirement plan. 
Social Security is also a plan particularly for younger families. As a 
matter of fact, 37 percent of those on Social Security today drawing 
benefits are younger Americans who are disabled or have had a family 
member, a breadwinner, die, or they are the dependents of these 
particular beneficiaries of Social Security.
  Social Security provides the equivalent for, let us say, a young 
couple, age 27, two children, it provides the equivalent of $403,000 in 
term life insurance. And for those who become disabled, nobody thinks 
he will, but many do; for those who become disabled, it provides 
$353,000 in disability insurance, which would be hard to buy in the 
individual market. And that is not to mention Medicare, which comes 
with the Social Security disability. Yes, sir.
  Mr. MEEK of Florida. If I may, I just want to ask a question, because 
I think this pie chart really paints the picture, literally. People 
think that this Social Security debate, some people do, feel that it is 
just about people that are already retired, and they are concerned 
about their retirement. Yes, valid point. They should be concerned 
because we do know, and you were a Member of the 108th Congress and 
many congresses before that. The President stood in the well there and 
shared with us, if you are over 55 you do not have anything to worry 
about.
  But I remember vividly in the 108th Congress, when we talked about 
the prescription drug benefit plan, they said it would be $350 billion 
only, and now we know it is $724 billion and probably climbing as it 
relates to costs.
  But disabled workers, that can happen any time in your lifetime.
  Mr. SPRATT. And it does. One in seven workers ends up on disability 
before retirement
  Mr. MEEK of Florida. And that is Social Security. And what we do 
know, and I hope that you would get an opportunity to talk about, the 
President's plan cuts benefits twice on one of the charts that I know 
you have there, to let the American people know that and also Members 
know that when you go to privatization that you lose benefits. I mean, 
that is what the record is reflecting right now. And I think it is 
important that everyone understands what is happening.
  Mr. SPRATT. This chart shows it as graphically as we can express it. 
There are two claws impinging on Social Security under the President's 
proposal. First of all, most Americans do not understand this, but when 
you go to retire, if you have elected to put money into a private 
account, the first thing you will have to do before Social Security 
computes your benefits is pay Social Security back. That private 
account, that ownership account, is really a loan from the Social 
Security Administration. You have to pay back, upon retirement, every 
dollar you have diverted into a private account plus interest at 3 
percent over the rate of inflation. That means that there will be a 
significant privatization tax which gets bigger and bigger over time, 
depending on how many years you are in the work force.
  In addition to that, there is another factor buried in all the detail 
which is critically important because it changes the nature of Social 
Security. And that is that basic benefit computation will be free 
formulated. Let me express that differently.
  Today, when you go to retire, the clerk at Social Security takes all 
your earnings from age 14 onward, takes the highest 35 years, averages 
those, brings them up to a present value, and then, each year, the 
amount of income that you can get is dependent upon a formula that is 
used to derive what is called the PIA, the primary insurance amount. 
You get 92 percent of the first $627. You get 30 percent of the next 
$3,779, and you get 15 percent of everything else. That is complicated.
  But the net result of that is that lower-income workers tend to get 
more, a better deal out of Social Security than the higher-income 
workers do. It has this effect to it that makes it a social insurance 
plan and not just a retirement plan.
  If you change the way that benefit is indexed every year, which the 
President proposes to do. Today that basic benefit will be indexed and 
changed according to the rate of inflation and wages in our economy.
  The President wants to change it to price inflation. That is economic 
talk. But it is critically important in a practical sense because, over 
a 70-year period of time, it will slash in half the basic benefit to 
which you are entitled from Social Security. And this chart shows it 
right here.
  Someone who is retiring in 2075, born in 2010, a couple of years from 
now, 42

[[Page 9112]]

percent of his accumulated benefit in his private investment account 
will have to be paid back to Social Security; 56 percent of the 
remaining amount will be diminished by the recalculation, the 
reformulation which President Bush is proposing. So we have what is 
left that this chart shows. You start out with the big blue bar, all 
along here. That is scheduled benefits under Social Security.
  The green amount beneath that shows the traditional Social Security 
benefit to which you are entitled; in 2015, it makes up most of your 
benefit. But by 2045, about half of your benefit is traditional Social 
Security, and half is in your private account.
  When you get to the 70th year, almost all of your benefit is coming 
out of the private account, and only a small part, this little green 
tip down here, is coming from traditional Social Security. So we are 
going to ask you, the young people of today, the families that are 30-
something with kids, raising them, to continue paying that 12.4 percent 
in the traditional Social Security, only to get this in the way of 
traditional benefits out of it. It is going to change the nature of the 
program in ways that cannot even be fully anticipated.
  Mr. DAVIS of Alabama. Mr. Speaker, let me follow up on the comment 
that the gentleman from South Carolina (Mr. Spratt) just made, because 
a lot of very reasonable people, as you know, believe that this 
scenario you described is not accidental. It is not just a by-product 
of the President's strategy, but it is, indeed, the President's 
strategy, to turn Social Security, which is a universal benefit that 
the American people collectively pay into, to transform it from that 
world into a world, frankly, where it looks like a conventional welfare 
program, a program where very poor people receive a benefit from it and 
the rest of the population receives very little.
  Now, what happens to those kinds of programs? Number one, the 
Republicans cut them every year. They do not fare very well in this 
budget process. If you look at the programs that we have in this 
country that we fund out of our sense of charity, Section 8, walking 
away from it, housing, dealing with the disabled and mentally ill, all 
the programs that we fund out of our altruism, unfortunately, those are 
the programs that are getting cut. I do not believe that this is an 
accident, that the Republican party and President of the United States 
are taking this plan that has worked enormously well and refashioning 
it into a program where, frankly, people will have less of a stake in 
paying into it.
  The second observation, I would say to the gentleman from Florida 
(Mr. Meek), is that it is indisputable that Social Security is the most 
successful government program in the last hundred years in terms of its 
ability to move people from the margins of life to a state of security. 
When Social Security was passed in 1938, 52 percent of the seniors in 
this country lived in poverty.

                              {time}  2030

  Today that number is down to 9 percent.
  If every other government program had been as effective in reducing 
poverty, there probably would not be more than 20 or 25 Republicans 
here because we would have won the whole political debate. This has 
been an extraordinarily successful program and part of the reason it 
has been successful is the stake that we all have in its benefit.
  I make one other point tonight. A lot of our colleagues on the other 
side of the aisle say, well, you Democrats have been criticizing our 
proposals. Why do you not come forward with a better and stronger plan 
for saving Social Security, and never mind that the President has no 
plan to make it solvent, why do you all not come to the table with one?
  There is a part of this debate that we should not miss tonight. Part 
of the reason that we are expecting a gap in Social Security financing, 
a shortfall in Social Security financing, is because of this 
administration's estimates of slow growth in the next 30 to 40 years. 
And a Republican Party that used to pride itself on economic optimism 
even in the face of no evidence has now become the party of slow 
growth. They tell us that our productivity will inch around at a rate 
of around 1.9 percent for the next 30 years, or our growth rate will be 
around 2.1 percent.
  What is the reason that they project slow productivity and slow 
growth? The major reason is because right now in our country the gap 
between skilled and unskilled workers is more pronounced today in the 
middle of the first decade of the 21st century than it was in the early 
1970s and the late 1960s.
  In other words, the gap between the people who know how to do the 
work in this country and who are trained to do and those who are not so 
lucky or so fortunate is greater than ever.
  That is creating an albatross on our whole economy. And if we are 
serious about tackling the Social Security problem, we have got to come 
up with a growth strategy. We have got to come up with a strategy to 
close that gap between skilled and unskilled workers. And the 
extraordinary thing about this budget is that it cuts money for 
workforce development. It cuts out programs like Upwards Bound and TRIO 
that take at-risk kids and give them a leg up. It cuts economic 
development programs. It cuts all of the things that would narrow and 
close down the gaps that exist in American life.
  In other words, at a time when we ought to be investing more in our 
future, we are investing less. Once again it takes us back to the point 
that the gentlewoman made about the fundamental definitional divide 
between these parties.
  President Clinton who grew 22 million jobs in his Presidency 
understood that when you spend money on education, when you spend money 
on worker training, when you spend money on developing skills you are 
making investments. And those investments reap an enormous return for 
this generation and the next one.
  So I say in conclusion before I take my leave tonight that if we are 
to deal with this problem of Social Security having a shortfall over 
the next 30-some years, if we are to deal with these gaps that exist in 
our skilled and unskilled workers that lead to the slow growth the 
administration promises us, we need a different set of priorities. We 
need to remember the value of expenditures that are investments.
  Ms. WASSERMAN SCHULTZ. Mr. Speaker, what I wanted to do is take off 
from what the gentleman from Alabama (Mr. Davis) was saying because the 
President started out this debate 4 months ago following the election 
saying that Social Security is in crisis, that Katie bar the door, we 
have to do something, we have to do something now; and if we do not, 
then the world will essentially come to an end.
  Now, he has gradually backed off that and you do not hear the word 
``crisis'' out of the President anymore. You hear more along the lines 
of what we have been saying which is there is a problem that needs 
addressing; and we have been saying that because you have the strength 
of a 70-year safety net in place, that we should not be irresponsible 
about how we reform it. We should not be irresponsible by slashing a 
gaping hole in that safety net through which millions of people would 
fall.
  And because this is the 30-something Working Group, I have often 
pointed out that when we talk to our friends, our peers who are also 
members of our generation, I know I ask my friends if they think that 
Social Security will be there for them when they retire. I am 38. The 
gentleman from Florida (Mr. Meek) is 38, and we have friends who do not 
believe that Social Security will be there. Yet, if we look at the 
numbers, all the reliable numbers, the ones right from the Social 
Security Administration, the first instance that we have even a concern 
about whether or not we are going to be taking in as much as we are 
paying out is 2041.
  Well, I will be 74 years old in 2041. And if you are using the more 
reasonable, non-Dooms Day numbers, it is more likely that 2051 is when 
we begin to approach a problem. I will be 84 years old. Now, that is 
about 20 years

[[Page 9113]]

past normal retirement, so the sky is not falling.
  There is a problem and a responsible government will recognize that 
problem and take the time to make the changes that we need to make 
without throwing out the baby with the bath water.
  Mr. SPRATT. Mr. Speaker, following up on what the gentlewoman has 
said, this chart spells it out, it is a little busy, but the President 
and others who are claiming there is a crisis point in 2017, 2018 as a 
pivotal year, that is the year when incoming dedicated revenues will be 
exceeded by outgoing scheduled benefits. But Social Security at that 
point in time, the trust fund will be sitting on a reserve, a cache of 
U.S. Treasury bonds equal to $4.7 trillion. The interest on those 
Treasury bonds will not only continue to ensure benefits in full; they 
will actually add to the surplus, the corpus of the trust fund, so that 
in the year 2027, $6.5 trillion will be in that cache of Treasury bonds 
held by the trustees of Social Security.
  Now, at that point in time the interest income will no longer be 
adequate to fully cover the benefits outgoing, but with $6.5 trillion 
in Treasury bonds, by redeeming those bonds the system is assuredly 
solvent until 2041.
  As the gentlewoman just said, the actuaries of Social Security are 
paid to be conservative. They are paid to be very, very cautious and 
they are. The rate of growth they are assuming is a very, very modest 
rate of growth. We do not want to be fools, so we take a very 
conservative view of things. But the CBO has taken a slightly more 
realistic view of the future and they say, we think you will make it to 
2052. We think the system then will be able to pay out 78 cents on the 
dollar, not fully but substantially, and after that something in the 
range of 78 cents on the dollar.
  So the system is faced with problems down the road, but we have got 
time to fix them. The sooner the better; and if we fix them right, we 
will not have a problem.
  I was here in 1983. Social Security really was in trouble in 1983. 
Some forecasted that it would scrape bottom, run dry in the retirement 
trust fund in July of 1983. President Reagan got together with Tip 
O'Neill and the leadership of the Senate. We appointed a truly 
bipartisan representative board. You had Mr. Greenspan at one end. 
Claude Pepper at the other end. Dan Moynihan here. Jim Baker there. 
They got together and they came up with a menu of different choices to 
which every stakeholder contributed something. And the result was the 
system was made assuredly solvent for the next 60 years.
  That can be done again. There is no reason we cannot do it again, and 
everybody then can breathe easily. But you cannot do it and incorporate 
these private accounts which are carved out of Social Security and make 
the shortfall today twice as large as it actually is.
  Ms. WASSERMAN SCHULTZ. What I wanted to bring out was exactly what 
the gentleman was talking about. We have a problem that needs to be 
addressed. But we can not throw our Nation's retirement security, our 
constituents' retirement security, to the whims of the stock market and 
then add insult to injury by saying that we are going to adjust their 
benefits based on the price index as opposed to their wages, because 
obviously wages grow more quickly than prices do.
  So their benefits are going to be cut both through the indexing and 
through the privatization and on top of that will add to the deficit.
  This is about the most irresponsible proposal that I have ever heard 
of.
  Mr. MEEK of Florida. Mr. Speaker, if I can, before we walk too far 
away, before we walk too far away from what the gentleman said, the 
fact that he was here in 1983. I will tell you how this argument works.
  In 1983 I was in high school. I was a senior. The gentleman is still 
a good man. I was a senior in high school. And we know in that year it 
took a lot of leadership because there was a big Democratic majority 
here in this House and in the other body across the hall. There was a 
Republican in the White House, but on behalf of the American people, 
and there was a true crisis and the gentleman described it. And I just 
happen to have the vote here.
  Here in the House it was 243 people that voted for it, voted for that 
bipartisan proposal. It took leadership in this House and in the White 
House, and that is what it will take in this debate. In the other body, 
we had 58 of our colleagues down the hall, 58 of them voting for it at 
the time.
  That was a bipartisan bill. It was not something that was one sided, 
and that is what is wrong with this debate now.
  I want to make sure that Members and the American people understand. 
If we were in the majority, we, Democrats, that it would be a 
bipartisan approach because many folks do not understand, well, why are 
they talking about it? Why do they not just do it?
  Well, we want to do it. The gentlewoman from California (Ms. Pelosi), 
our Democratic leader, wants to do it. The gentleman from New York (Mr. 
Rangel), the ranking member on the Committee on Ways and Means, want to 
see a bipartisan approach. But that is not happening right now, and 
that is the reason so many things are happening to the American people 
in this debate.
  Mr. Speaker, I yield to the gentleman from Ohio (Mr. Ryan).
  Mr. RYAN of Ohio. Mr. Speaker, I thank the gentleman from South 
Carolina (Mr. Spratt) for being here and raising the intellectual level 
of this debate that we usually have.
  Mr. Speaker, I had a town hall meeting last night on Social Security 
in Green, Ohio, just south of Akron. And it was 2 or 3 to 1 against any 
kind of privatization.
  There was one point I wanted to share tonight. There was a woman who 
was there who said she was actually for the private accounts until she, 
I think, found out a little bit more about them. The 4 percent that the 
President says that you can divert and put into a private account, she 
made $19,000 a year. Now, 4 percent of her income, of $19,000 a year, 
is never going to be enough for her to be able to retire on.
  And there was a gentleman who was there who said that he made 30-some 
thousand dollars a year his whole life, never any more; he did not have 
any money to put extra into these personal accounts. What he would have 
put in, he went back and did the math, would have never worked out to 
him receiving the kind of money that he would have been able to get 
through Social Security.
  So it may sound good that you are making a lot of money every year 
that, hey, I will get a little extra and put that in the market too. 
But what about those people who are struggling now more than ever, 
making 19, 20, 25, $30,000 a year. Four percent of that is peanuts to 
say that you will be able to retire on.
  So as we have this debate about the personal accounts, I think it is 
very important for us to recognize that diverting 4 percent of your 
Social Security taxes into this is never going to be enough for this to 
retire on.

                              {time}  2045

  That was really the only point I wanted to make here. I want to thank 
the gentleman for joining us. Throughout, since I have been here, he 
has been the guru on the budget. We all follow his lead. So I thank him 
very much.
  Mr. MEEK of Florida. Mr. Speaker, we have about 3 minutes left. So if 
the gentleman from South Carolina (Mr. Spratt) wants to make some 
closing comments, he can.
  Mr. SPRATT. Mr. Speaker, there is one thing we have not spoken about. 
We have talked about the budget deficit. We did not speak about the 
trade deficit, $666 billion, also an encumbrance we are leaving our 
children. We did not talk about the jobs deficit. In the last 
recession, 2.5 million manufacturing jobs, the best of our jobs, were 
lost, that have not come back. Service jobs have but not manufacturing 
jobs.
  One of the solutions to all of this has got to be education. We have 
got to have a workforce that is educated as never before in American 
history, adaptable, keen, intelligent, quantitative, and if we look at 
the budget

[[Page 9114]]

the President sent us for the first time since 1988, a President of the 
United States requested less for spending on education than we are 
currently spending at the present time.
  He wipes out vocational education, $1.3 billion. Wipes out the drug 
free schools. Wipes out GEAR UP for underprivileged kids who want to 
get a college education. Wipes out Even Start. Wipes out educational 
technology.
  There are some plusses and puts and takes so that a lot of these do 
not come out on the bottom line, but when we consider everything, this 
is the least forthcoming education request at a time when education was 
never needed as much as it is now. So we have got an education deficit 
as well.
  That is why we are out here tonight, to talk about the 20-somethings 
and the 30-somethings and what they can expect for the future of 
America. We have got deficits, which means that we are leaving negative 
legacies in numerous different areas that we have got to reverse, we 
have got to undo, and it starts with the budget. We simply cannot keep 
stacking up mountains of debt which we shove off into the future for 
our children to pay.
  Mr. MEEK of Florida. I thank the gentleman from South Carolina (Mr. 
Spratt). I yield to the gentlewoman from Florida (Ms. Wasserman 
Schultz).
  Ms. WASSERMAN SCHULTZ. Mr. Speaker, I just appreciate the gentleman 
from South Carolina's (Mr. Spratt) and the gentleman from Florida's 
(Mr. Meek) leadership and the opportunity for us to help explain to our 
generation what the ramifications will be if the President's proposal 
goes through. I think it is real important that we plug the Web site, 
and the gentleman from Florida (Mr. Meek) has it up here on the board.
  Mr. MEEK of Florida. We even want e-mails from Members, but 
definitely from the American people and others. 
[email protected] is our e-mail address. We always look 
forward to receiving e-mails.
  As we close, I just want to not only commend the gentleman from South 
Carolina (Mr. Spratt) for his leadership but for the leadership of this 
Democratic Caucus here in the 109th Congress and the 108th Congress, 
which I have served in, and presently serving in the 109th, for 
standing up and saying what is right, making sure that we watch out for 
future generations; just for the charts that are being generated out of 
the gentleman from South Carolina's (Mr. Spratt) committee staff and 
from the gentleman, I tell the American people and also I tell Members 
of the majority side, if it is about defense, then 44 percent of our 
debt is owned by foreign countries, up drastically since President Bush 
has taken office.
  This chart that the gentleman showed dealing with retired workers of 
62.8 percent that is dealing with Social Security, that the benefits 
they are receiving, 13 percent of workers that have disabilities. I 
mean, these are real issues that are facing families in America right 
now, and this is a moral issue as the gentleman mentioned.
  Spouses with children, 10.1 percent, and survivor benefits, the 
highest outside of retired workers, 14.1 percent. These are individuals 
that their loved ones, mothers and fathers, have passed on, and they 
are living on the benefits that they left behind. Sometimes that is all 
they had to leave. The most shocking chart that the gentleman provided 
to all of us here is how the benefit structure goes down, 34,587 cut.
  I want to thank the gentlewoman from California (Ms. Pelosi), the 
Democratic leader, once again for allowing us to have this time.

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