[Congressional Record (Bound Edition), Volume 152 (2006), Part 4]
[House]
[Pages 5396-5409]
[From the U.S. Government Publishing Office, www.gpo.gov]




        CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 2007

  The SPEAKER pro tempore. Pursuant to House Resolution 766 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the State of the Union for the consideration of the concurrent 
resolution, H. Con. Res. 376.

                              {time}  1209


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the State of the Union for the consideration of the 
concurrent resolution (H. Con. Res. 376) establishing the congressional 
budget for the United States Government for fiscal year 2007 and 
setting forth appropriate budgetary levels for fiscal years 2008 
through 2011, with Mr. Terry in the chair.
  The Clerk read the title of the concurrent resolution.
  The CHAIRMAN. Pursuant to the rule, the concurrent resolution is 
considered read the first time.
  General debate shall not exceed 4 hours, with 3 hours confined to the 
congressional budget, equally divided and controlled by the chairman 
and ranking minority member of the Committee on the Budget, and 1 hour 
on the subject of economic goals and policies, equally divided and 
controlled by the gentleman from New Jersey (Mr. Saxton) and the 
gentlewoman from New York (Mrs. Maloney).
  The gentleman from New Jersey (Mr. Saxton) and the gentlewoman from 
New York (Mrs. Maloney) each will control 30 minutes on the subject of 
economic goals and policies.
  The Chair recognizes the gentleman from New Jersey.
  Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
  As you just indicated, the first hour of this budget debate has been 
set aside pursuant to the Humphrey-Hawkins section of the Budget Act. 
Under the rule, the Joint Economic Committee will have this hour evenly 
divided on two sides.
  According to most neutral observers, including the Federal Reserve, 
and a consensus of private economists, the current economic expansion 
is quite healthy. That is good news. Indeed, if anything, there seems 
to be a little concern in most quarters that the economy may be growing 
too fast, a concern that I do not share.
  The U.S. economy grew 4 percent in 2004 and advanced at a rate of 
about 3.5 percent in 2005. The growth rate in the first quarter of 2006 
is expected to be very robust, probably over 4 percent, consistent with 
the trend of strong growth seen since 2003.
  The improvement in economic growth is reflected in other economic 
figures as well. Let me name a few.
  Since August of 2003, business payrolls have increased by 5 million 
jobs. The unemployment rate has declined to 4.8 percent. Consumer 
spending continues to grow. Homeownership has hit record highs. 
Household net worth has also reached a record high. Productivity growth 
continues at a healthy pace. Long-run inflation pressures appear to be 
contained. Long-term interest rates, including mortgage rates, are 
still relatively low, although somewhat higher than what they had been 
previously. The resilience and flexibility of the economy have overcome 
a number of serious shocks, most recently the hurricanes of last year. 
Equipment and software investment have been strong over this period. 
However, with somewhat higher mortgage rates, the housing sector is 
slowing, although it appears that a soft landing is most likely. It is 
clear that the Federal Reserve remains poised to keep inflation under 
control.
  In a recent policy report to Congress, the Fed noted that the U.S. 
economy delivered a solid performance in 2005. Furthermore, the Fed 
observed that ``the U.S. economy should continue to perform well in 
2006 and 2007.'' The Fed, along with a number of private economists and 
government agencies, expects that economic growth in 2006 will be about 
3.5 percent, still very healthy growth. This economic growth will 
continue to expand employment and further reduce unemployment.
  In summary, overall economic conditions remain positive. The U.S. 
economy has displayed remarkable flexibility and resilience in dealing 
with the many shocks, including terrorist attacks and weather effects.
  The administration forecast for economic growth in 2006 is comparable 
with those of the blue chip consensus

[[Page 5397]]

and the Federal Reserve. With growth expected to be about 3.5 percent 
in 2006, the current economic situation is solid and the outlook 
remains favorable.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. MALONEY. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, I am pleased to speak in the time reserved by the 
Budget Act for discussion of economic goals and policies and 
traditionally led by members of the Joint Economic Committee.
  If you listen to the President and his supporters on the other side 
of the aisle, you get a very upbeat assessment of the American economy; 
but if you listen to the American people, you get a very different 
assessment.

                              {time}  1215

  The President likes to talk about how fast the economy is growing and 
how successful his policies have been in stimulating an economic 
recovery from the 2001 recession. But the American people are saying, 
what economic recovery, and when am I going to see the benefits from 
this President's economic policies in my take-home pay, in my pocket?
  Mr. Chairman, we should listen to the American people and we should 
adopt economic policies that promote the economic well-being of all 
Americans, not just those at the very top of the economic ladder. The 
President's fiscal year 2007 budget and the House budget resolution do 
not do that.
  Instead, they continue economic policies that have produced a legacy 
of deficits and debt, that leaves us unprepared to deal with the budget 
challenges posed by the retirement of the baby boom generation and that 
weakens the future standard of living of our children and 
grandchildren.
  This administration has set a series of records, only they are the 
wrong kind of records. They have raised the debt ceiling four times. It 
is now over $8 trillion. Every man, woman and child in America now owes 
at least $28,000 of that debt, and we have had the largest deficit and 
trade deficit in the history of this country.
  This chart shows how the President inherited a budget situation with 
large surpluses, but we have ended up with a string of large deficits. 
Economic policy over the last 5 years has not served the interest of 
the typical American working family. The resilience of the American 
economy has allowed it to recover from the 2001 recession, but we are 
still experiencing the labor market effects of the most protracted job 
slump in decades.
  Job creation has lagged far behind what is typical in a strong 
economic recovery. There is still evidence of hidden unemployment, and 
the benefits of productivity and productivity growth have been showing 
up in the bottom lines of companies rather than in the paychecks of 
American workers.
  Finally, and very disturbingly, there is a growing gap between the 
``haves'' and the ``have-nots'' in this country as income and earnings 
disparities have widened. This is a very troubling trend. Yes, workers 
have become more productive. They produce more and more in each hour 
that they work. But they have not been getting rewarded for their 
productivity.
  Average hourly earnings have not kept up with inflation, and they 
barely kept up even before that. Median family income has failed to 
keep up with inflation every year that President Bush has held office. 
Those who are already well-to-do are doing very well in the Bush 
economy. But the typical, hard-working American family is struggling to 
make ends meet in the face of high costs for energy, health care, and a 
college education for their children.
  This chart illustrates the problem very clearly. The red bar shows 
the growth in the inflation-adjusted usual weekly earnings of full-time 
wage and salaried workers under President Bush at different points in 
the earnings distribution. You have to be in the upper half of the 
distribution to have seen any gain. Earnings at the top have grown 
fastest relative to inflation and earnings at the bottom have fallen 
farthest behind inflation.
  I would note the contrast with the last 5 years of the Clinton 
administration, which is the blue bars, when earning gains were strong 
and spread throughout the earnings distribution. They spread the 
wealth. They shared the wealth. The budget we are debating today does 
not address any of these problems. In fact, it makes matters worse.
  An analysis by the Democratic staff of the Joint Economic Committee 
shows that budget cuts in programs that provide payments for 
individuals are concentrated among lower income families, while the tax 
cuts go overwhelmingly to those at the top of the income distribution. 
The blue bars on this chart show that more than a third of the cost for 
spending cuts go to families in the bottom 20 percent of the 
distribution, families that together have only 3 percent of aggregate 
income. Meanwhile, those at the top get nearly three-quarters of the 
benefits from the tax cuts in this budget, as shown by the red bars in 
this chart.
  With policies that have turned a $5.6 trillion 10-year budget surplus 
into a deficit over those same 10 years of at least $2.7 trillion, this 
administration has turned us into a nation of debtors, relying on the 
rest of the world to finance our budget deficits and the rest of our 
excessive spending.
  Last year, we had a current account trade deficit of over $805 
billion, the largest in the history of this country, the largest in the 
world. That is the amount of money we had to borrow from the rest of 
the world to finance our trade deficit and international payment 
imbalance. Foreign governments are holding large quantities of our 
public debt, putting us at risk of a major international financial 
crisis if they should decide the benefits of holding dollars are no 
longer worth that risk.
  Mr. Chairman, our future prosperity depends on increasing our 
national savings and making wise investments. It depends on being ready 
for the retirement of the baby boom generation and the pressure we know 
that will be put on the budget with their retirement. But how is the 
other side preparing us for that future? With more deficits and more 
debt, the largest in the history of our country.
  They want to make the tax cuts that have gotten us into this mess 
permanent, and they have no realistic plan for controlling spending or 
bringing revenues into line with the amount we need to spend to defend 
the country and take care of the needs of our citizens. This is the 
wrong direction that we are going in. We need a better plan.
  Mr. Chairman, I reserve the balance of my time.
  Mr. SAXTON. Mr. Chairman, I yield such time as he may consume to the 
gentleman from northwestern Pennsylvania (Mr. English).
  Mr. ENGLISH of Pennsylvania. I want to thank the gentleman for 
yielding, and I think the time has come, particularly after the last 
speech, for a reality check here.
  What we have seen since the 1990s is that the key to balancing the 
budget is economic growth and pro-growth tax policies. That is what our 
budget resolution stands for and what our budget resolution promises to 
preserve. In the 1990s, when we balanced the budget, and I might add we 
balanced the budget because we had a Republican Congress committed to 
fiscal austerity, we were able, through controlling spending, to allow 
the growth in the economy to overcome a budget deficit that the other 
party, frankly, couldn't deal with when they were in the majority.
  By putting in place pro-growth economic policies in 2003, this 
Congress laid the groundwork for an economic recovery which has 
generated unprecedented revenues and, in generating those revenues, has 
steadily brought down the deficit and brought it within reach of 
control.
  Now, I will be the first to admit this budget document does not fully 
account for the cost of war. It doesn't account for the cost of some of 
our recent national disasters. Those have always been treated as one-
time expenses, and appropriately so. But our underlying deficit, in my 
view, is being dealt with in this budget in the most direct and 
credible way, and that is through restraining spending and allowing us 
to

[[Page 5398]]

maintain in place pro-growth tax policies.
  Now, what the other side doesn't tell you, and what they are really 
hot for, is that they want to see a tax increase. They want to see us 
forced to raise tax rates above those contemplated in our 2003 tax 
policy. Our existing tax policy, as then Chairman Greenspan conceded, 
has been critical in growing the economy; growing the economy last year 
at a rate of 3.5 percent, the envy of the industrialized world; growing 
our economy in a way that allows us to find new revenues even as we 
create wealth and we create jobs.
  Now, Mr. Chairman, I will be the first to concede that in 
congressional districts like mine in northwestern Pennsylvania we have 
seen the downside. We have seen an economy that has lagged behind the 
national economy. We have seen the effects of unfair trade. We have 
seen job losses that haven't fully been recovered, particularly in the 
manufacturing sector. But the solution is a growing economy.
  And what this budget resolution promises is that we will be able to 
maintain the tax policies that have produced the growth even as we curb 
spending and show fiscal restraint. In the process we are in a position 
to set up this country to escape from the budget deficit, to lower 
national debt as a proportion of the national economy, and, over time, 
position ourselves to hand to the next generation a prosperous America.
  This budget resolution is critical to the long-term economic health 
of our country, and it is based on a philosophy of pursuing pro-growth 
policies that allow us to generate the revenue that we need. The other 
side, by pushing us towards policies that would raise taxes and 
ultimately take more resources out of the economy, I think threatens 
that growth and threatens that recovery.
  Ultimately, I believe, there is a clear contrast here, one in which I 
am very proud to stand on the side of growth and opportunity.
  Mr. SAXTON. Mr. Chairman, I reserve the balance of my time.
  Mrs. MALONEY. Mr. Chairman, I yield to my distinguished colleague 
from the Joint Economic Committee and from the great State of New York, 
Maurice Hinchey, such time as he may consume.
  Mr. HINCHEY. Mr. Chairman, I thank very much my colleague from the 
State of New York, our ranking Democrat on the Joint Economic 
Committee, for her leadership here and for yielding me this time.
  This debate in which we are engaged in this afternoon is a critically 
important one for the future of the American economy. As my colleague 
Mrs. Maloney pointed out just a few moments ago, we are currently 
facing the largest budget deficits in the history of our country. 
According to the budget resolution itself, this burgeoning budget 
deficit will grow by $372 billion just over the course of the next 
fiscal year. Many people regard that number as conservative.
  Many people who are analyzing the economic circumstances that we are 
confronting as a result of the incompetent budget policies of the 
Republican Party here in the Congress estimate that this budget deficit 
can be substantially more than $400 billion. In any case, even if it is 
only $372 billion, that sets another record. Now, maybe they are proud 
of the record that they are setting, and that seems to be the case 
based upon what we have just heard.
  In addition to the record budget deficit this year, we are also 
facing record debt. The national debt has now grown to more than $8 
trillion, and the majority party here in the Congress very, very 
quietly, under cover, raised the debt ceiling to almost $9 trillion.

                              {time}  1230

  This majority party is the biggest borrow-and-spend operation that we 
have ever seen in the United States of America, totally and completely 
irresponsible in their approach to dealing with the American people's 
money. As a result of that, the economic circumstances that we are 
confronting are becoming increasingly difficult.
  A major portion of their failures has been their approach to the tax 
system. We just heard my friend and colleague on the other side of the 
aisle say that the Democrats are in favor of a tax increase. That is 
completely fraudulent. It is another part of the propagandistic 
approach that the majority party has taken to dealing with these most 
significant issues in which we are presently engaged.
  We are not in favor of tax increases; we are in favor of reducing the 
irresponsible tax reductions that the Republicans have engaged in over 
the course of the last 5 years. Those tax reductions have benefited 
primarily the wealthiest 1 percent of the population of America.
  Let me give an example of that. If you are a person making $10 
million a year, if that is what you made last year, $10 million, the 
effect of the tax cuts on your budget is very, very significant. When 
you factor in the deductions and investment approach, you find that 
your taxes have fallen by $1 million. Your taxes have fallen by $1 
million if you are making $10 million a year. That is what they have 
done. They have cut taxes for the very wealthiest people, and they are 
increasing the budget deficit that is going to have to be paid back by 
the vast majority of working people in this country, this generation 
and future generations.
  This is the borrow-and-spend approach to governance that the 
Republican Party in this House has put forward and which they continue 
to advance in the context of this budget resolution.
  What has been the effect of all this on the average American? What we 
have seen is that wages and salaries of the working people of our 
country have risen at their lowest rate since 1981. And I am talking 
about over the last 5 years. They have risen at their lowest rate since 
1981. When you look at what has been happening in the last 2 years, you 
find that wages and salaries have actually been in decline. People are 
seeing their wages and salaries, when you take into effect inflation, 
actually going down.
  So if you are a wealthy person, the Republicans are taking very good 
care of you. If you are an average American working for wages and 
salaries, you are finding your situation in desperate shape. So this 
budget resolution is another failure on the part of the majority party 
in America. They are creating deeper deficits for us. They are putting 
us into deeper and deeper debt. Their approach to taxation has been for 
the rich and against the working class; and in an economy which is 
based upon demand, it is forcing that economy down, and we are seeing 
it broadly all across the American economy, losing manufacturing jobs 
at record rates. All of that is as a result of the economic policies 
that have been put forth by the majority party here in the House of 
Representatives.
  So the point we are making right here now is once again we have a 
budget resolution on the floor of this House which is incompetent and 
irresponsible, which is going to mean higher taxation in the future for 
the average working families in our country while it cuts taxes for the 
wealthiest and most privileged and while it increases the national 
debt.
  They talk about the economy growing. We have had an economy that has 
experienced the most stimulation, both monetary policy stimulation and 
fiscal policy stimulation, in the history of the country. The lowest 
interest rates and huge amounts of spending have increased the national 
debt. That is the situation we are confronting here today, and that is 
why this budget resolution needs to be defeated.
  Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
  It seems like there must be an election coming to hear some of the 
rhetoric here on the floor which actually defies reality. Let me try 
and explain to those who are at least open-minded about the situation 
what has happened with our economy over the past 5 or 6 years.
  We all remember during the late 1990s we had very robust growth in 
the stock market. Things were perking along at a rate that most 
economists at the time thought was an exuberant

[[Page 5399]]

time when investments were being made for reasons other than perhaps 
good, solid rationale.
  In the third quarter of 2000, the economy began to get soft and in 
the last quarter of 2000 it did even worse. As we look at the reasons 
for that, there were a number of economists who concluded different 
things. One thing became clear, and that was investment was not being 
made and that something needed to be done.
  This chart to my left is a chart which shows fixed private, 
nonresidential investment, in other words, investment in things that 
would be productive in our economy. As we look at what happened as we 
began to move through 2001 and 2002, these bars that drop below the 
line show there was negative investment. People were not investing in 
productive things; and as a result of that, the economy was not doing 
well.
  The administration proposed a fix, and that fix was to do things here 
in the House of Representatives and in the Senate and through the 
administration that would encourage the American investor to reengage 
in investing in productive things. And so in 2003 the House of 
Representatives and the Senate collectively, together, passed some tax 
cuts to encourage investment. And those tax cuts, which were temporary 
in nature which we continue to talk about making permanent, had the 
desired effect.
  If we look at this chart and look at when the negative investment 
ended and positive investment started, it happens to be after those tax 
cuts went into effect. As a result of reducing the percentage of taxes 
paid on dividend gains and as a result of tax cuts on capital gains, we 
see beginning in 2003 and through 2004 and through 2005 and projected 
to continue by the Fed and by other blue chip economists and blue chip 
forecasts, we are expecting to see that growth continue through 2006 
and 2007. As a matter of fact, we had 4 percent growth in 2004; 3.5 
percent growth in 2005; and in the first quarter of 2006, we saw 4 
percent growth continue. This is good news for not only the American 
investor; it is also good news for others in the workforce and in the 
economy.
  Here is what happened to employees' payrolls during that period of 
time. Once again we see some lines that drop below the positive mark. 
We see some negative growth in nonfarm payrolls as we move through. And 
as we saw the 2003 tax cuts go into effect, once again we saw the 
economy rebound and we see employees in nonfarm payrolls begin to 
increase to much healthier levels than they had been during the 2000, 
2001, 2002, and 2003 period of time when investments, productive 
investments, were not being made.
  As we sought an answer and the administration proposed the tax cuts 
and the House and the Senate implemented the tax cuts, once again 
nonfarm payrolls and employees' payrolls began to grow, as demonstrated 
by this chart.
  Finally, gross domestic product, which is how most economists measure 
growth in the economy, continues to be very good. Beginning in 2003, as 
our tax cuts went into effect, dividend tax cuts, the taxes on 
dividends were lowered, the taxes on capital gains were lowered. We see 
in 2003 and 2004 as we move across here, and as I said before in 2004, 
we had an average of 4 percent growth. In 2005, we had an average of 
3.5 percent growth over the four quarters of that year.
  The forecast for the first quarter of this year, which is in red, the 
first of the four lines, the actual forecast is 4.7 percent. I think 
that might be a little high. I think it might be closer to 4 percent. 
But that is healthy economic growth, and we continue to see the effect 
of the policies we have put into place. We expect that the growth may 
slow somewhat during the first, second, and third quarter; but we 
believe we will average 3.5 percent this year.
  I might add one thing that I think is important for us to remember, 
and that is that the tax cuts, together with other policies, have 
produced this growth and we need to continue to support those policies 
as well. The Federal Reserve has been a huge part of this as well. 
While it is nice for the Congress to take credit with the 
implementation of the tax policy that we implemented, the Federal 
Reserve also deserves a lot of credit for what has happened here 
through the policies that have been brought about through something 
called ``inflation targeting.''
  Today, inflation is very low. Inflation is around 2 percent; and it 
is around 2 percent because, in my opinion, the Federal Reserve has 
used this policy of inflation targeting as the cornerstone for Fed 
policy. As inflationary expectations, as we look to the future, 
interest rates have continued to be historically low. In spite of the 
fact there has been a little up-tick in interest rates because of Fed 
policy in the last year or so, we continue to see affordable interest 
rates and interest rates that influence investment and continue to 
provide the stimulus that we need for the kind of economic growth that 
we have seen since 2003.
  Mr. Chairman, I just wanted to make these points. I think this is a 
very important background for us as we begin this budget debate.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. MALONEY. Mr. Chairman, I yield myself such time as I may 
consume.
  Mr. Chairman, the gentleman mentioned the rhetoric coming from this 
side of the aisle; but we are not speaking rhetoric, we are speaking 
facts and figures and numbers do not lie.
  The other side of the aisle raised the debt ceiling four different 
times under this administration so we now have a record debt of over $8 
trillion. That is not rhetoric; that is a fact. If you break it down, 
each man, woman and child in America owes $28,000; and it is galloping 
upwards, the debt on our children and our grandchildren.
  Another fact that is not rhetoric is we have the largest trade 
deficit in the history of our country, the largest in the history of 
the world; and other countries are financing our budget. We are 
shifting our wealth to other countries. It has been said if China 
invaded Taiwan, we would have to borrow money from China to defend 
Taiwan. That is not a good position to be in.
  Mr. Chairman, the budget offered by the majority continues the failed 
economic policies of the Bush administration. The typical American 
family is still feeling the effects of the most protracted job slump in 
decades. Actually, it is the worst job slump since the 1930s. On top of 
that, wages and incomes are stagnating. There is a growing gap between 
the haves and the have-nots. This is a tremendously troubling trend in 
our country.
  But this budget does not address any of those problems. It contains 
unfair spending cuts that disproportionately harm middle- and lower-
income families to help pay for tax cuts that go overwhelmingly to 
those who are already very well off. Where is the fairness in this 
budget?
  And this budget continues to add to our legacy of deficits and debt 
and has turned us into a Nation of debtors relying on the rest of the 
world to finance our budget and our deficits.

                              {time}  1245

  This is a very troubling trend in our country. We have never had it 
before. It leaves us unprepared to deal with the challenge posed by the 
retirement of the baby boom generation and weakens the future standard 
of living of our children and our grandchildren. I urge a ``no'' vote 
on this budget.
  Mr. Chairman, I yield 4 minutes to the gentleman from South Carolina 
(Mr. Spratt), the distinguished ranking member on the Budget Committee. 
We thank him for his leadership on this and his leadership in so many 
areas.
  Mr. SPRATT. Mr. Chairman, the administration has devoted a lot of 
energy to touting the successes of the economy, particularly with 
respect to the job statistics, as justification for the 2001 and 2003 
tax cuts. But let's look at the record.
  When President Clinton took office in January 1993, there were 109.7 
million jobs in the national economy in the work force. When he left 
office in January of 2001, there were 132.5 million jobs. That means 
that during the 8 years of the Clinton administration, there was a gain 
of 22.8 million jobs. These were the jobs created during the Clinton 
administration at a time when

[[Page 5400]]

we brought the budget to balance, making the bottom line of the budget 
every year better and better and better to the point where we had a 
surplus in 1998.
  Now, compare that job gain, 22.8 billion to what has happened during 
the Bush administration. When President Bush took office in January 
2001 there were 132.5 million jobs in the economy, according to the 
BLS. By January of 2006, 2 months ago, the economy had a total of 134.6 
million jobs. That is an increase of 2.1 million jobs, versus 22 
million jobs created during the Clinton administration. No comparison. 
Stark contrast.
  What is even worse is the fact that the Bush administration has seen 
most of its job gains of more than 50 percent occur in the public 
sector, not in the private sector. The tax cuts that have led to the 
deficit did not generate the jobs that were proposed or projected in 
the private sector. Far from it. Growth has come in the public sector.
  And this is worst of all. Job growth in the manufacturing sector 
under President Clinton grew by 315,000. Not impressive, but at least 
not a loss. Under President Bush the manufacturing sector has lost 2.9 
million jobs. 2.9 million jobs over the last 5 years, an average of 
48,000 jobs a month.
  Now, when we say that the economic gains that appear from this GDP 
growth and other things that look positive, stock market, the Dow Jones 
are all doing well and are healthy vital signs, we are glad to see 
them. But they are not translating into the lives of the ordinary 
working Americans. This is why the loss of manufacturing jobs, the best 
paying jobs in our economy, particularly for blue collar Americans, 
this is why it has happened, because this is why the family median 
income in real terms adjusted for inflation has gone down almost every 
month since 2001.
  So beneath the glitter and generalizations are some stark facts that 
don't really appear to support the claims the Bush administration has 
made. Namely, they have created just over 2 million jobs, whereas the 
Clinton administration created 22.8 million jobs during his time in 
office. And they have presided over a devastation in the number of 
manufacturing jobs, a loss of 2.9 million manufacturing jobs in our 
economy.
  Mr. SAXTON. Mr. Chairman, I yield myself such time as I may consume.
  One additional way to look at our economy and to see how it compares 
with what we may have seen around the rest of the globe is to simply 
look at the statistics as to how our U.S. economy has performed as 
compared to some others. For example, when we look at real GDP growth 
from the first quarter of 2001 through the fourth quarter of 2005, the 
U.S. economy expanded at an average annualized rate over all of those 
times, even though it was slow during the earlier years, at 2.6 
percent, and the United States ranked first among its peer group in the 
world in real GDP growth.
  In terms of investments of fixed assets, from 2001 to 2005, growth 
investments in fixed assets as a percentage of GDP growth rose in 
Canada and the United States but fell in the European Union and Japan. 
And so once again, the United States was a leader in terms of 
investment and fixed assets.
  In terms of industrial production from 2001 to 2005, through 2005, 
the United States industrial production increased by 7.1 percent, a 
very, very healthy picture. And I might add that this industrial 
production increased because of investments, because of investing in 
productive things, investment brought about by the budgetary policy and 
the tax policy of the Congress of the United States and the 
administration.
  Employment and unemployment. From January 2001 through December 2005, 
the United States ranked second in employment growth in both absolute 
and in percentage terms. In the United States employment grew by 
5,165,000 jobs, or 3.8 percent. Canada ranked first in percentage 
growth with 9.3 percent, while the European Union ranked 15, first in 
total increase of 5.7 million, which was actually 3.4 percent, far 
below the United States.
  In December of 2005, the U.S. had an unemployment rate of 4.9 
percent, the second lowest among its peer group. If we look at this 
chart next to me of unemployment rates, if you look at the unemployment 
rate in the European Union, it was 8.3 percent. If we look at the 
unemployment rate in Canada, it was 6.4 percent. And at the end of the 
year, same time frame, the unemployment rate in the United States was 
4.8 percent.
  Just interestingly enough, there is a member of the U.K. Parliament 
in town today, and I saw him early this morning and he said, I envy 
you. I said thank you, and why is that? He said, when I go to work at 
home and I earn an income for my family, 59 percent gets paid to the 
government. I envy us, too, because we have seen beyond the period of 
high taxes. We have seen beyond the period of producing an economic 
policy that in Europe provides today for an 8.3 percent unemployment 
rate or in Canada of a 6.4 percent unemployment rate. We are fortunate. 
But it is because of good policy. It is because of the policy of this 
administration and this Republican Congress that we have a 4.8 percent 
unemployment rate.
  Labor productivity is up in our country as well, and that is one of 
the reasons for this great economic growth. From the first quarter of 
2001 to the fourth quarter of 2005, labor productivity grew by 9.5 
percent. That means that because of technology that we have invested 
in, smartly, and partly because of tax policy, we have made our workers 
more productive than at any time in our history and the most productive 
work force in the world.
  I said a word a few minutes ago about price stability. Price 
stability is what it is today, lack of inflation, inflation of 2 
percent or under, because of Fed policy. Chairman Bernanke told me 
earlier this week that he intends to continue policies that have price 
stability as the number one goal as inflation targeting continues, to 
keep our rate of inflation low and to keep interest rates low 
accordingly. Smart economic policy.
  And so as we walk through the things that have occurred, partly 
because of the Congress and partly because of the Federal Reserve, we 
see that things in our country are doing well, particularly when 
compared to others.
  On balance, the U.S. economy has outperformed its peer group and 
large developed economies in a number of key measures of economic well-
being between 2001 and 2005, during the period that George W. Bush has 
been President.
  Pro-growth tax policy and good monetary policy have contributed to 
the superior performance of the U.S. economy, and as my friend from the 
U.K. Parliament said today, yes, we are proud of this record.
  Mr. Chairman, I reserve the balance of my time.
  Mrs. MALONEY. Mr. Chairman, I yield 4 minutes to the gentleman from 
Maryland (Mr. Cummings), a member of the Joint Economic Committee.
  Mr. CUMMINGS. Mr. Chairman, I rise to join my Democratic colleagues 
on the Joint Economic Committee in condemning the Republican leadership 
fiscal year 2007 budget before us today.
  Since President Bush took office our Nation has experienced the 
greatest average annual decline in household income during any 
administration since 1960. Not surprisingly, more Americans live in 
poverty and more lack health insurance now than when Mr. Bush took 
office.
  The economic choices our Nation has made have fallen particularly 
hard on African Americans. According to the United States Census Bureau 
in 2004, households headed by African Americans had the lowest median 
income of any racial group. Poverty among African Americans reached 
nearly 25 percent, while nearly 20 percent of African Americans lacked 
health insurance.
  The United States Department of Labor reports that the unemployment 
rate among African Americans has risen 13 percent since President Bush 
took office, and stood at more than 9 percent in December 2005, which 
is more than twice the unemployment rate among white Americans.
  Confronted with this situation, in which the potential of an entire 
generation of African Americans could be

[[Page 5401]]

lost to rising poverty and joblessness, the House has presented us with 
a budget resolution that would cut $447 million from the amount needed 
just to maintain the current level of services provided to assist 
primarily low wage workers and vulnerable families, such as housing 
assistance for people with disabilities and the elderly, food programs 
that help low income elderly and mothers and children, job training 
programs that help the unemployed, and child care assistance.
  Confronted with this situation in which 13 million American children 
live in poverty, including 9 million African American children, the 
House has presented us with a budget that will result in several 
hundred thousand low income working women and their children losing 
their health coverage through a failure to fill a funding shortfall in 
the States' Children Health Insurance Program.
  The House has presented a budget resolution that would add $348 
billion in fiscal year 2007 to our ballooning deficit to extend tax 
cuts totaling $228 billion that will continue to go primarily to the 
wealthy. In fact, according to the Tax Policy Center, during the years 
2007 through 2016, 29 percent of the tax cuts that have been enacted in 
the individual income tax, the estate tax and the Alternative Minimum 
Tax since 2001, will go to the top 1 percent of earners while the 
bottom 60 percent of households will receive just 14 percent of tax 
cuts.
  Mr. Chairman, the budget before us is simply unconscionable and the 
financial policies it continues are unsus-
tainable.
  I urge my colleagues to recognize our true priorities lay with our 
people and placing our country on a sound economic footing. I therefore 
urge my colleagues to join with me in rejecting this budget.
  Mrs. MALONEY. Mr. Chairman, I yield 1 minute to the gentleman from 
Texas (Mr. Gene Green).
  Mr. GENE GREEN of Texas. Mr. Chairman, more than any single piece of 
legislation we passed this year, the budget reflects our Nation's core 
values. Unfortunately, this budget values deficits over balanced 
budgets and tax cuts over the health and education of the American 
people.
  This budget cuts more than $10 billion from critical domestic 
programs our constituents rely on every day. By eliminating 42 
educational programs, the budget fails our children and wastes our 
opportunity to invest in their future.
  It hurts low-income students' shot at the American dream by wiping 
out the GEAR-UP program that prepares them for college.
  It threatens our future economic competitiveness by eliminating 
vocational programs to help our students gain skills in the global 
economy.
  There is so much in this budget that is wrong this cannot actually 
represent the value of this Congress and the values of the American 
people because of what it does.

                              {time}  1300

  It cuts the budgets of 18 out of 19 institutes of the National 
Institutes of Health. It raises deductions and copays for veterans 
health care.
  Mr. Chairman, there is so much wrong with this budget that one thing 
it does, it continues the tax cuts, and that is why it is not the 
American values.
  Let us help our children, our veterans, and our elderly without 
giving tax cuts.
  Mr. Chairman, more than any single piece of legislation we pass this 
year, the budget reflects our Nation's core set of values.
  Unfortunately, this budget values deficits over balanced budgets, and 
tax cuts over the health and education of the American people. This 
budget cuts more than $10 billion from critical domestic programs our 
constituents rely on every day.
  By eliminating 42 education programs, the budget fails our children 
and wastes our opportunity to invest in their future. It hurts low-
incomes students' shot at the American Dream by wiping out the GEAR-UP 
program that prepares them for college. It threatens our future 
economic competitiveness by eliminating the vocational education 
programs that help our students gain the skills to compete in a global 
economy.
  This budget breaks our commitment to military retirees by 
increasing--and in some cases tripling--their out-of-pocket health care 
fees. It abandons our quest for health care research and discovery by 
cutting the budgets of 18 out of 19 institutes within the National 
Institutes of Health. It cuts programs aimed at preventing illness and 
disease while also slashing programs that train health professionals to 
treat these diseases.
  As a country at war, there is no doubt that we have to make 
sacrifices to successfully implement the war on terror and equip our 
troops. But the funding cut from domestic programs in this budget does 
not go for war costs. In fact, war costs aren't even included after 
2007.
  The funding cuts also aren't being used to balance the budget. With 
this budget, this country will post a deficit of $348 billion for 
2007--one of the largest deficits in our Nation's history.
  Instead of funding war costs or paying down the deficit, the cuts in 
this budget are used for tax cuts; $228 billion in tax cuts for the 
wealthiest Americans when families are in need here at home, and troops 
are putting their lives on the line far from home.
  Mr. Chairman, at best this budget is misguided. But the truth is, 
this budget is down right immoral, and I urge my colleagues to join me 
in opposition to it.
  Mr. SAXTON. Mr. Chairman, I yield such time as he may consume to the 
gentleman from Michigan (Mr. McCotter).
  Mr. McCOTTER. Mr. Chairman, I come from a Midwest State, from 
Michigan, home of the auto industry. And while my district is 
relatively doing well, according to the unemployment figures that have 
been released, I can assure you that Michigan as a State is not doing 
well. There are several reasons for this, which the place here is not 
to debate. But the thing that I ask as a Member from Michigan is that 
we do not make it more difficult for the people of Michigan to right 
the ship and to begin our path to an economic renaissance.
  Struggling pockets of poverty and struggling pockets in the 
manufacturing base in Michigan and the Midwest and other parts of this 
country can never be revitalized or returned to their prominence if we 
deviate from the economic path we are on today, because if the American 
economy goes back to a higher system of taxation, a system that then 
crushes entrepreneurial initiative and the individual genius of the 
American worker, States like Michigan will never recover.
  We need to continue the economic expansion in this country. We need 
to continue to follow pro-growth policies, especially in the area of 
taxation. We do not give anything to anyone. We merely allow them to 
keep what they have earned so that they can then directly invest in the 
future of their children, of their community, and of the life of this 
country.
  So, Mr. Chairman, I welcome this debate on the budget. I welcome the 
debate about the priorities. But I would encourage us to continue the 
path because of the several fundamental assumptions that the current 
policies that we, as the Republican majority, have adopted. I think 
they must continue because they are very prescient.
  The first, and I reiterate, is that tax relief does not give anything 
to anyone. It allows people to keep the fruits of their hard work. That 
is not a gift. It is a recognition by government that people who 
generate wealth should be able to invest it for the betterment of 
themselves and their family and their community.
  Secondly, history has proven to us that as the taxation rate 
continues to escalate, what happens then is money that is more 
productively invested into the life of the American community is then 
less productively spent when it is vicariously handled and invested, or 
spent, by the United States Government.
  Thirdly, I would like to point out that when we talk about 
government, there are objections about Republican fiscal policies that 
government has to pay for things. The third root assumption, I think, 
that our economic policies follow, which must be continued, is that 
government pays for nothing; working people pay for everything.
  So I would encourage us to remember that we live in a sovereign 
democracy, a democratic Republic where your private property is your 
private property

[[Page 5402]]

until the government gets it through the consent of you, the governed. 
Government then holds your money in a pool, collectively in trust, to 
be expended on behalf of you and your fellow citizens.
  So let us not forget that, as we discuss taxation policy, because 
when we are essentially asking to deviate from the tax policies of pro-
growth that we have today where people keep what they earn, we are 
beginning to forget the fact that the United States Government does not 
create wealth, the United States Government does not pay, the United 
States Government is not the repository of property to be dispensed 
back to people.
  The American people have private property rights, and they have the 
unalienable right to keep the fruits of their labor. Our policies 
reflect that, and I believe that the American economy, this 
entrepreneurial energy, has been unleashed because of these policies.
  And I conclude by again reiterating my commitment and my hope that 
this collective Congress continue the path we are on so that States 
like mine can continue the path to recovery.
  Mrs. MALONEY. Mr. Chairman, I yield such time as he may consume to 
the gentleman from New York (Mr. Hinchey).
  Mr. HINCHEY. Mr. Chairman, I thank my friend and colleague from New 
York for her leadership on this Joint Economic Committee.
  As we have heard over the course of the period of this debate, we 
have had in the last 5 years huge amounts of economic stimulation in 
this economy. The amount of economic growth dropped off sharply when 
the Republican Party took control of both the executive and the 
legislative branches of government in 2001. With the cooperation of the 
Federal Reserve, huge amounts of monetary stimulation were injected 
into the economy, and they dropped the interest rates to zero. And this 
Congress engaged in a spending program which was enormous, huge amounts 
of spending coming out of these congressional resolutions, these budget 
resolutions and appropriations bills.
  That kind of economic stimulation should have been very positive, but 
it was not. One of the reasons it was not is because it was done in a 
very irresponsible way. It was done by borrowing huge amounts of money, 
and that borrowing has created record amounts of debt for the American 
people, which they will have to pay back over the course of 
generations.
  As we have heard, the national debt now exceeds $8 trillion, and the 
majority party has risen that level to almost $9 trillion. With that 
kind of economic stimulation, huge amounts of spending and very low 
interest rates, we would have had every reason to anticipate that 
unemployment would drop, that more and more people would be employed, 
that they would be employed progressively, that their wages would be 
increasing, and the economic circumstances for the American workers and 
for American families would have gone up, except that, as I pointed 
out, it was done so irresponsibly so that most of the benefits have 
gone to the wealthiest people in this country and little or no benefits 
have gone to the middle class.
  So the effect has not been that we have cut unemployment and 
increased employment. We now have 1.2 million more people in America 
who are unemployed than there were 5 years ago.
  Long-term unemployment is even worse: 1.4 million Americans are 
suffering long-term unemployment.
  They have talked about job growth. Well, of course there has been 
some job growth. What has that job growth been? It has averaged about 
38,000 jobs a month. Normally, even without that huge amount of 
stimulation, that huge amount of spending, normally what we have in 
America is job growth at the rate of 125,000 to 150,000 jobs a month. 
Job growth under their economic program has been down to 38,000. That 
is why we have more and more people unemployed, short term and long 
term.
  Manufacturing jobs, the essence of our economy, the most important 
aspect of our economy, manufacturing jobs, have gone down by 2.9 
million jobs since they have taken over both the executive and 
legislative branches of government. Real wages for working people in 
this country have not gone up as you would expect with that kind of 
huge amount of spending, but real wages have fallen in the past 2 
years. In fact, in the last 2 years, they have gone down by nearly 1 
percent after inflation for American families.
  So the budget resolution that we are seeing today is consistent with 
the economic policies that the Republican Party has put forth over the 
last 5 years, which have been so devastating to the American economy, 
to American workers, and to American families. And that is the reason 
why this budget resolution must be defeated.
  Mr. SAXTON. Mr. Chairman, I yield 2 minutes to the gentleman from 
Missouri (Mr. Hulshof).
  Mr. HULSHOF. Mr. Chairman, I appreciate that, and I appreciate the 
leadership of the gentleman from New Jersey.
  Let me just say to the last speaker, nothing done for middle-income 
families? Consider that 5 million taxpayers have completely had their 
income tax liability removed. In fact, they pay no income tax liability 
to the Federal Government anymore after these pro-growth tax 
initiatives.
  Mr. Chairman, I was listening to this debate, and I have to tell you, 
as someone who was an economist at the University of Missouri Columbia, 
I remember sitting in those, some would say, boring lectures. I was one 
of the few that actually enjoyed those lectures. But it used to be 
thought that if you had the unemployment rate in America certainly at 5 
percent, it was considered to be full employment. We have a 4.8 percent 
unemployment rate. As has been rightly pointed out, inflation has been 
kept in check. We have homeownership at an almost all-time high. 
Consider the fundamental under-
pinnings of this economy.
  And my friend from South Carolina, whom I have great respect for, I 
was listening to your discussion as well, and you acknowledged at least 
there has been some job creation; and you talked about the 8-year 
period of time under the previous administration, and we are at a 5-
year point here as far as this administration. But consider what this 
President inherited. Certainly everyone can agree, when you put the 
partisanship aside, if you can, that the economy was slowing in the 
last 2 years of President Clinton's administration. Then you consider 
actually what happened as far as the tech bubble bursting, corporate 
scandals that rocked the confidence of the investor class, the shock 
that the economy took on September 11.
  Clearly, we had the horrific human tragedy but, of course, the 
economic tragedy as well, plus trying to respond to Katrina and the 
multiple catastrophic events that we have attempted to do. When you 
consider we have weathered all of those storms, so to speak, and we 
have unemployment at 4.8 percent, inflation less than 3, homeownership 
and all this other positive economic news, and the fundamentals are 
there, I recognize again that the loyal opposition must be loyally 
opposed and to your political peril that you would talk up the economy. 
But I would just simply say that in this intensely partisan political 
time, at least give credit where credit is due.
  I thank the gentleman for yielding.
  Mr. SAXTON. Mr. Chairman, just to conclude this debate, it was not a 
Republican idea originally to stimulate economic growth by use of the 
tax policy. It was John Kennedy's idea. When Ronald Reagan was elected 
President, we Republicans all stuck our chests out and said what a 
wonderful idea. But it was John Kennedy, who, in his State of the Union 
speech after he was elected, said we cannot expect to continue to lead 
the economic world if we fail to set the economic pace at home. And he 
went on in his speech to detail the tax cut plan that he wanted to put 
in place. It was put in place and the economy grew. And Ronald Reagan 
did the same thing. A different plan, same concept. And George Bush I 
did the same thing, and George W. Bush has embarked upon the same 
thing.
  Now, it has been suggested by the minority that somehow we can have 
tax

[[Page 5403]]

cuts without cutting taxes of people who pay taxes. This chart to my 
left shows who pays taxes. As a matter of fact, the top 1 percent of 
the taxpayers pay 34 percent of the taxes. The top 50 percent of the 
taxpayers pay 96 percent of the taxes. And that means that about 4 
percent of the personal income taxes that are paid in this country are 
paid by the bottom 50 percent of the wage earners. As Mr. Hulshof just 
pointed out, many of those folks have been taken off the tax rolls 
altogether.

                              {time}  1315

  So the charge that people who earn more money get a larger share of 
the tax cut, I guess I would just ask this question: If you believe, as 
I do, that tax cuts stimulate economic growth, and if you are going to 
have tax cuts at all, then you have to cut taxes from the people who 
are paying them, and they are almost all in the upper half of the 
income brackets.
  The CHAIRMAN. All time on this part of the debate has expired.
  It is now in order to conduct general debate on the congressional 
budget. The gentleman from Missouri (Mr. Hulshof) and the gentleman 
from South Carolina (Mr. Spratt) each will control 90 minutes.
  The Chair recognizes the gentleman from Missouri.
  Mr. HULSHOF. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, today is a great day, a great day of opportunity for 
this House and really for the American people. I want to echo what was 
said during the previous debate, particularly by my good friend and 
colleague Mr. McCotter from the State of Michigan.
  I want to start by actually announcing a truism that certainly all of 
us, Republicans, Democrats, Independents, liberals and conservatives 
can agree with, at least I believe it to be a truism, and it would be 
simply summed up in two statements:
  First of all, wealth and prosperity and economic opportunity do not 
come from government programs or increased Federal spending. Isn't that 
at least something we can begin to agree upon?
  The second corollary that again I think is axiomatic that again 
surely all of us can agree with, is, secondly, the Federal Government 
cannot tax its way into prosperity.
  So when you consider where we are, as we try to make these very 
difficult, tough budget choices, I believe that the budget that we have 
on the floor today should deserve bipartisan support. I don't expect 
it, but it should.
  This fiscal year 2007 budget continues and furthers our plan to 
strengthen our Nation's most critical programs. It reforms the Federal 
Government. It spends the taxpayers' dollars wisely.
  Again, I am certain that as we over the next couple of weeks go to 
visit with our constituents, those folks that are actually paying the 
bills, they simply want to be assured that they are getting a dollar's 
worth of value out of every dollar that they send to the Nation's 
Capital. This budget does that, and in fact it does it by focusing on a 
number of priorities.
  We build upon our Nation's greatest strengths. We continue our 
successful pro-growth policies to ensure that our economy, that has 
been doing well, job creation that has been increasing, remains strong 
and that we continue that vibrant economy.
  We also accommodate the administration's request to provide whatever 
is needed in the way of resources to support our troops, again 
something that I think both sides of the aisle will agree with. We have 
to continue to keep our Nation's defense and security the strongest in 
the world, especially at this very critical time.
  But we will also continue our efforts at controlling spending across 
the board. We want to restrain the nonsecurity discretionary spending 
programs. We want to build on our progress to reform and find savings 
in some of these mandatory programs that are on autopilot, if you will.
  In addition to furthering those reforms to improve our Federal 
Government programs, it is time again to begin to reform the budget 
process itself to better reflect and address how Federal Government 
dollars are actually spent.
  When we had our interesting markup last week in the Budget Committee, 
and I suspect as we heard that night, again, the loyal opposition is 
likely to provide a somewhat schizophrenic argument. On the one hand 
they are going to decry the fact that this budget does nothing as far 
as the Federal deficit and adds to the Federal debt. In other words, 
they are saying that this budget, we spend too much. And probably then 
in the second sentence, they will say ``and it doesn't invest enough in 
certain programs.''
  In other words, our friends across the aisle will talk about that the 
budget spends too much and then it doesn't spend enough. Certainly I 
would say that covers all the bases.
  We think that this is a responsible budget. It focuses on our 
priorities, our strengths. It keeps us on a pro-growth agenda to keep 
this economy growing, because as we realized back during the days of 
the 1990s, with the Democratic President and a Republican-led Congress, 
we were able to make some significant progress. But it wasn't just 
Congress. It was those hardworking men and women across the country, 
the laborers, the farmers, the manufacturers, the lumberyard dealers, 
the tool and die makers, those in the service industry, those folks 
that punch the clock every day, go to work, play by the rules, pay 
their taxes and simply want the best out of government that they 
deserve. We think this budget accomplishes that, and I urge its 
support.
  Mr. Chairman, I reserve the balance of my time.
  Mr. SPRATT. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, in describing the difference between Republicans and 
Democrats, between them and us, when it comes to the budget resolution 
for 2007, let me go straight to the bottom line: We have got a 
manifestly better bottom line.
  The Democratic substitute returns the budget to balance in the year 
2012. Building on our reputation for fiscal responsibility which we 
established in the 1990s during the Clinton administration, every year 
the bottom line of the budget got better and better and better until 
the year 1998 when we had a surplus and the year 2000 an unprecedented 
surplus of $236 billion. That was the year before the budget was handed 
over to President Bush, and it has gone downhill ever since.
  So what is the difference between us on the bottom line? The 
Democratic budget resolution returns the budget to balance by the year 
2012.
  In the interim, our budget runs smaller deficits and racks up less 
debt. Not by a huge amount, but by a significant difference. The 
Democratic resolution also holds nondefense domestic discretionary 
spending to the level of current services over 5 years, showing that we 
can exercise spending control without devastating vital services and 
programs that people dearly depend upon.
  The Republican resolution, as I said, never reaches balance and 
presents no plan or prospect of ever wiping out the deficit or reducing 
the debt.
  The Republican budget resolution in fact would make the deficit worse 
by $410 billion over 5 years than would just a basic, current services 
treadwater budget.
  OMB projects a deficit for this year, 2006, of $423 billion. House 
Republicans project a smaller deficit of $372 billion, and they project 
this deficit to decline to $348 billion in 2007, showing a bit of 
improvement. But these projections still mean that on the watch of 
President George Bush the five largest deficits in our country's 
history will occur. The five largest deficits in our country's history 
will occur on the watch and administration of President Bush.
  To make room for the Bush administration's budget, four times 
Republicans in the House and Senate have raised the debt ceiling of the 
United States by $3.015 trillion. They have raised the debt ceiling by 
over $3 trillion between June of 2002 and March of 2006.
  Under the Republican budget resolution, the statutory debt ceiling 
will increase by an additional $2.3 trillion by

[[Page 5404]]

2011. This means that debt ceiling increases from 2002 to 2011 will 
equal $6 trillion, and the statutory debt will stand at $11.3 trillion, 
more than doubled over the 10-year period 2002 to 2011, from $5.3 
trillion when President Bush took office to 2011.
  We can talk about budget in terms of fiscal policy, we can talk about 
it in terms of budget policy or just plain accounting issues, should we 
have accrual budgeting or cash budgeting, but here is the bottom line. 
This budget is a moral document, and the choices it makes, for whom it 
helps and whom it hurts, but, more importantly, in the debt it 
accumulates which we hand over to our children.
  Are we going to be the only generation in recent American history 
which bequeaths to our children this dreadful legacy of debt, 
mountainous debt, $11.3 trillion by 2011? Today we will make the 
decision once again as to whether or not that is going to be the legacy 
we leave our children and grandchildren.
  To discuss this further, I now yield 6 minutes to the gentleman from 
Tennessee (Mr. Cooper) and request when his time comes, he can use this 
time and allot it to the other Members of the House.
  The CHAIRMAN. The gentleman is recognized for 6 minutes. During that 
time, he may yield to others while remaining on his feet.
  Mr. COOPER. Mr. Chairman, I thank my friend from South Carolina for 
yielding. He is one of the great Members of Congress of our time, and 
this is a vitally important debate.
  Our first speaker on our side talking about fiscal responsibility 
will be my good friend and colleague from Wisconsin (Mr. Kind), for 1 
minute.
  Mr. KIND. Mr. Chairman, I thank my good friend from Tennessee for 
yielding me this time, and I commend him for his leadership in trying 
to institute budget reforms and instill fiscal discipline in the 
budgeting process.
  Listen, we are going to have a very vigorous debate over the next 
couple of days in regards to the priorities and the values of our 
Nation, as it should be. People are entitled to their own rhetoric, 
they are entitled to their own spin, their own opinion, their own 
ideology, but we are not entitled to our own facts, and the facts 
couldn't be more stark or more different in regards to the leadership 
on our budget under Democratic leadership versus the current 
administration.
  As this chart demonstrates, it shows the trend line for budget 
deficits and budget surpluses, and this upward trend during the 1990s 
under the leadership of Bill Clinton and Democrats indicates pay-as-
you-go rules as they existed for the administration and Congress which 
led to 4 years of budget surpluses when we were actually paying down 
the national debt.
  This cliff, which this red line demonstrates under the Bush 
administration, is the administration and Congress operating without 
pay-as-you-go rules.
  What is so hard to get here? We need to reinstate pay-as-you-go rules 
to bring back fiscal discipline and responsibility, as the gentleman 
from South Carolina indicated, for the sake of our children's future. 
Our budget alternative does that. Theirs doesn't.
  We are going to continue this downward trend with deficit spending as 
long as we don't get back to the budget basics.
  Mr. COOPER. Mr. Chairman, I thank my friend from Wisconsin.
  The CHAIRMAN. The gentleman will suspend. The gentleman from 
Tennessee was recognized for 6 minutes, during which he may yield to 
others while remaining on his feet.
  Mr. COOPER. I thank the Chair. I yield now 3 minutes to my friend and 
colleague and fellow Blue Dog, the gentleman from Tennessee (Mr. Ford).
  The CHAIRMAN. A Member who does not control time, but who only is 
yielded time for debate, is free to yield to others while remaining on 
his feet. He may not reserve time. Although he may indicate to others 
his intent to reclaim the time after a certain point, he may not yield 
blocks of time.
  Mr. FORD. Thank you, Mr. Chairman, for your admonishment there.
  I thank my friend in leading our delegation, Jim Cooper here in the 
Congress, and thank him for one skill that he seems to have above many 
of us here. It is just called math. When you were in younger grades, 
they called it math. When you got older, they added some more 
syllables, they called it arithmetic. But the rules were the same. You 
can't spend more than you have.
  What has happened here over the last few years is really remarkable. 
I grew up around this place because my dad was in Congress for 22 
years. He worked closely with Mr. Spratt and a lot of people who are 
here now. I was a child, or growing up. I don't mean to date them at 
all, but I grew up around them and with them.
  There was a time when the Republicans were perceived as the party 
that understood math and Democrats were the party that didn't 
understand math. Then we elected a President from a little State called 
Arkansas and he picked a little Senator from my State named Gore, and 
they came to Washington, as Jim Cooper and I know well, and they forced 
a different kind of approach on us. And that approach was simply 
balance the budget, get taxes down for most Americans, get investments 
going up and allow the private sector to do what it does best, which 
used to be the mantra of my friends to the right of me, literally and 
politically.
  Wow, what a difference a few years makes once you get in power and 
you have all of that ability to spend money. Everything from pork 
spending, and I thank Mr. Cooper for his efforts on the committee for 
not embarrassing my friends on the right by forcing them to vote on 
that late in the evening about forcing us to include all of the pork 
projects, Mr. Chairman, before we voted on them and not allowing people 
to slide them into pieces of legislation late into the evening.
  We have 16 agencies that you can't audit, or several agencies within 
our government that are not auditable. We have yet to ask, and there 
was a time when the Republicans would ask these things.
  Here we are in 2006 and things have changed. The term ``flip-flop'' 
was used a lot 2 years ago. The flip-flop is here. We now find the men 
and women on this side raising these points and not my friends on the 
other side.
  I would remind my friends about their great fiscal management. Eight 
years before 2000, Mr. Chairman, the U.S. economy added almost 23 
million new jobs. That is 237,000 a month. Since 2000, job growth has 
slowed to a total of only 2.3 million jobs, or 38,000 a month. The 
normal retort is, well, the economy changed and we are at war. We are, 
but we have made no adjustments here at the Federal level when it comes 
to the government.
  I will make one last point.

                              {time}  1330

  Since 2000, the number of Americans living in poverty has grown by 
5.4 million people. When the last President was around, I remind you of 
the three things he did, he was a Democrat, Mr. Nussle: He abolished an 
entitlement program called welfare, he balanced a budget, and he 
created a surplus.
  Now, as much as you may want to criticize him and us, math does not 
lie. And you all are faced with a predicament that I would hate to be 
in, and perhaps if I had to make the case you are making I would throw 
it all back on us and try to create funny numbers and talk about debt 
as the size of the GDP.
  You cannot deny this. Bill Clinton abolished that entitlement 
program, he created a surplus, he balanced a budget. And, 
unfortunately, under your leadership, all of those things frankly have 
been abolished.
  Mr. COOPER. Mr. Chairman, in the time remaining, I am a Blue Dog, I 
am cochair of the Blue Dogs. Every Blue Dog has a sign outside his or 
her office that lists the debt, $8.3 trillion, and each American's 
share of that debt.
  It is very important that all Americans recognize the liabilities 
that this administration has added to our backs. Mr. Spratt said 
earlier, $3 trillion of this have been added just in the last 4 or 5 
years. It took America the first 204 years of its history to get $1 
trillion in debt. Now we are doing it about every 18 months.

[[Page 5405]]

  But don't take my word for it. Don't take the Blue Dogs' word. Look 
at a book just written by one of the most conservative Republican 
economists in America, Bruce Bartlett. It is called ``Imposter: How 
George W. Bush Bankrupted America and Betrayed the Reagan Legacy.'' 
Now, you might say, well, he is a disgruntled economist, although I 
would urge everybody who cares about our fiscal future to read this 
book.
  Look at this one. This is from President George W. Bush's Department 
of Treasury, and they are so proud of this document that it was 
delivered to this body on Christmas Eve without a press release. In 
this document, you discover that the deficit last year was not the $319 
billion that these gentlemen will admit to, it was $760 billion, over 
twice as large, and the unfunded liability for America approaches $46 
trillion. And this is not according to a Democrat or a disgruntled 
Republican, this is according to the Secretary of Treasury of the 
United States.
  So it is a vitally important debate, Mr. Chairman. We need fiscal 
sanity to return in this country.
  Mr. NUSSLE. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, I am proud to be here as the chairman of the Budget 
Committee to propose and debate the budget resolution for this fiscal 
year 2007, the blueprint that will guide the Congress' spending and 
revenue decisions for the coming year.
  It is not easy to write a budget ever. It is particularly challenging 
to write a budget when you have to deal with an economic recession, 
when you have to deal with the worst terrorist attack that has ever hit 
practically any nation, but particularly ours on our own shores. It is 
difficult to write one when you are at war, when you have a whole new 
priority of homeland security that was never even considered just 10 
short years ago, or the largest natural disaster ever to affect the 
United States called Hurricane Katrina. It is never easy to write a 
budget, and it is particularly challenging to do that when those kinds 
of things hit you not just one at a time but all at one time.
  Today we are going to hear a lot about politics. You know, there is 
this new movement around the country that I think is pretty important, 
and that is that we need new science and math education for our kids 
because we are falling behind, but I think we probably ought to add 
history to that, too.
  I love how the Democrats come to the floor today, and this is modern 
history for Democrats. In 2001, George W. Bush took office, and look at 
the deficit we have today. Nothing happened in between. Of course, 
there have been 6 years that have occurred, and during those 6 years we 
had those things like an economic recession, like Hurricane Katrina, 
like 9/11, like a global war on terror, the need to deal with homeland 
security. And all of those priorities not only were cheerfully voted by 
both sides, but the national debt not only went up under all of those 
votes, but in fact the Democrats proposed even more spending to drive 
that debt even higher.
  And probably the most humorous conversation was the one I just heard 
on welfare reform, how the President is the one who ushered in welfare 
reform, President Clinton? This is the same President Clinton who 
vetoed welfare reform twice, and in fact had to be dragged kicking and 
screaming to support the Republican-passed welfare reform, which was 
the first opportunity for us to reform entitlement spending and to deal 
with some huge challenges that gave us the first surpluses in history.
  So this budget is always going to be a challenge to write, but it is 
particularly going to be challenging if all we are going to hear on the 
other side is complaints and politics, and not any serious proposals to 
deal with it.
  Is this budget going to please everyone? No. You have just heard 
quite a few complaints about how this budget is not going to please 
Democrats, and I can certainly understand why. But this budget takes 
into account the conversations that we have heard from our constituents 
back home in particular, and I believe this is the budget that is the 
right budget and the plan to keep our country moving forward with a 
strong growing economy, with a secure homeland, to provide endless 
opportunities both today and tomorrow for our kids and our families. It 
is guided by what we think are our most important priorities and it is 
based on a clear set of principles: Strength, spending control, and 
reform. And let me just touch on these briefly.
  First on strength. This budget will further build on our Nation's 
greatest strengths, which include our Nation's national defense and 
homeland security, and the robust growth of our Nation's economy and 
job markets as a result of the plans and proposals that we have passed 
on this floor over the last 5 years.
  Spending control. This budget will continue our efforts to control 
spending across the board by further restraining the nonsecurity 
discretionary spending, and building on our progress from last year to 
reform government, achieve savings in mandatory entitlement programs.
  In addition to those reforms, we also believe that it is time for us 
to reform the budget process and continue the work that has already 
been done. This budget will begin to reform the budget process by 
actually dealing with emergency spending.
  And I will come back to all of these, but let me first touch on our 
strengths.
  The economy. As I just noted, our underlying strength comes from the 
Nation's economy, and in the past 4 years, 5 years, it really has 
delivered. I mean, we have seen some wonderful things as a result of 
the American people being able to spend and invest and use their own 
resources. After adjusting for inflation, our economy has grown at a 
robust average of better than 3 percent a year since 2003. Nearly 5 
million new jobs have been created in America as a result of this 
economy, and the unemployment rate has fallen to 4.8 percent, which not 
only is historically very low, but by many economists that is 
considered full employment. Even in the face of higher energy prices, 
which we are working to deal with, and the worst natural disaster on 
record, our economy has proven remarkably resilient and strong, 
growing, creating jobs, and increasing personal incomes.
  Clearly, the real credit for the growth goes to the people who do the 
work in this country, who work and save and invest and create jobs and 
allow our economy to continue to grow. But we in Congress did support 
their efforts by lowering their tax burdens, and this budget continues 
that because we believe there should be no tax increases, as opposed to 
the Democrats who propose tax increases in their alternative budget. 
And we did this because of our fundamental belief that the people back 
home really do make better decisions about their daily lives, about 
their businesses, about their farms, about their families and 
communities than the Federal Government ever could make for them.
  As a result of giving Americans more control over their money, we 
have seen more investment, more jobs, greater opportunities in our 
country, and as a further direct result of this growth from what 
Americans have done, revenue has come pouring into the Federal 
Treasury. In fact, last year we saw Federal revenues increase by almost 
15 percent in one year.
  Now, I realize we have got to stop and just highlight this because if 
you have been listening to the rhetoric on the other side, you will 
believe that the bane of all of our illnesses is because we have 
reduced taxes and that somehow tax cuts have caused this government to 
fall off its pedestal, when in fact reducing taxes has actually brought 
in 15 percent more revenue growth to our Federal Government, and it is 
because our economy works. When you are allowing people to keep their 
money and invest it on their own, it creates opportunities and jobs and 
business development, and as a result of that more people pay more 
taxes and that brings more revenue into the government.
  In short, our economy has gone from recession just a few short years 
ago to a strong sustained period of growth, and to ensure that that 
growth and strength continues to be in an upward momentum our budget 
does not increase taxes.

[[Page 5406]]

  Second is national security. This budget will also continue to 
provide whatever is needed to support our American troops and to ensure 
our Nation's defense remains the strongest in the world. We do not have 
a secret plan, as you will find in the Democratic alternative 
substitute, that basically says we are not going to fund the war after 
next year. It is kind of a secret plan to basically say one of two 
options. We are either going to bring all the troops home like the 
gentleman from Pennsylvania wants to do or we are not going to fund 
them so they are able to claim balance. They have basically put no more 
money, no support to our troops in the field over in Iraq and 
Afghanistan.
  The President's budget, not including war funding, has requested an 
increase of 7 percent to ensure that our men and women have the 
opportunity to support and defend our Nation and our budget will 
accommodate that request. We will also, as we have for the past two 
budgets, place $50 billion in reserve to fund those wars in Iraq and 
Afghanistan. And we know that it is going to take a commitment in years 
to come and we plan to support that commitment, not claim balance and 
not have some secret plan that is either going to underfund it or bring 
them home before their job is done.
  But even as we provide those resources, we also believe that the 
administration needs to get the message that we need a full accounting 
of how this money is being spent and what the implications are for the 
future. Particularly in the area of defense, we have got to do a better 
job to ensure that every dollar that we invest and that we put into 
this critical area is hitting its intended target. It makes our country 
safer. I cannot think of any activity that deserves more diligent 
oversight than our national defense.
  For homeland security we will provide whatever is needed to ensure 
our homeland at the border, in our country, in our cities, in our rural 
areas, whatever is needed. The President has proposed 3.8 percent of an 
increase and our budget accommodates that request. But just as with 
defense, we have got to do a better job in this new Department of 
Homeland Security to make sure these monies are being spent wisely and 
are actually working to make our Nation more secure.
  The second big principle on which we write this budget is controlling 
spending. Let's start with what we call ``discretionary spending.'' 
With the necessary shift of our Nation's priorities to provide for 
these areas of, after 9/11 as an example, we have come to employ kind 
of a shorthand to effectively divide this discretionary spending into 
two categories. Let me do that for people who are watching.
  We have security spending, which involves our national defense and 
our homeland security, and what we call ``nonsecurity,'' which is 
everything else. That is where you will find education, veterans, 
agriculture, the environment, et cetera. So you have security and 
nonsecurity. And as most of my colleagues will detail in this debate, 
we increased our security appropriations funding at a truly incredible 
rate over the past few years to deal with the challenges that our 
Nation has needed in regard to security.
  But that said, when we decided that our Nation's security was our 
highest priority, it also meant that everything else needed work and 
that everything else must come after, although many seem to regularly 
forget the Federal Government simply does not have an infinite supply 
of money, nor should it. So when we decide to increase spending in one 
area, you have got to determine how to pay for it and how to reduce 
spending in other areas. That is what budgeting is all about.
  Last year we held our nonsecurity spending to a freeze tighter than 
the previous year's 1.3 percent growth and certainly a marked 
improvement over the previous 5-year average of 6.3 percent. This year 
the administration has asked for a freeze, according to CBO's estimate, 
for all the nondefense, nonsecurity spending in our budget. We will 
assume that freeze is for nonsecurity spending. We believe that our 
security must come first or none of these other programs will matter 
much.
  That said, it is important to note that while our budget sets an 
overall number, it is the Appropriations Committee who determines how 
that money is allocated. Clearly there are high priority programs that 
receive and should receive increases. But in order to provide those 
increases, they have to have offsetting reductions and eliminations of 
other programs, and we know the Appropriations Committee can do this 
and will do this. Last year alone they eliminated somewhere near 110 
specific programs in order to ensure that we fund those programs that 
are higher priorities.
  Now, let's get to where the real rubber is going to hit the road with 
this budget and where it needs to hit the road.

                              {time}  1345

  This is the funding that is truly out of control.
  Our biggest challenge in Federal budgeting is the problem of 
mandatory, automatic, entitlement spending. That is now two-thirds of 
the budget, and two-thirds of the budget needs some attention. Well, we 
provide the attention while the Democrats, you can hear the crickets. 
They do not even look at it. There is no reform in their budget for the 
mandatory programs. Just do not worry about two-thirds of the budget. 
We are only going to talk about one-third, they say.
  We need to work on reforming these programs. They are important to 
the people back home. They are not always doing the job they need to 
do. We need to constantly reform and weed the garden to make sure that 
garden can continue to grow and make sure that we can eliminate the 
waste, fraud, and abuse in those programs.
  Currently, our mandatory spending is growing at 5.5 percent a year. 
That is faster than our economy is growing. It is faster than 
inflation, and it is certainly faster than any of our means to be able 
to sustain it.
  To put it another way, if our budget were balanced right now today, 
our entitlements would drive it right back into deficit; and so we have 
got to deal with these challenges which, of course, are highlighted 
probably most dramatically because there are 78 million baby boomers 
who are beginning to turn 60 this year, and medical costs are 
skyrocketing, and there is a steady decline in the number of workers 
for each retiree.
  The problem only gets worse. So we have got to address this. We have 
got to acknowledge on both sides of the aisle that ignoring this 
problem, offering no solution on how to fix it, and fighting against 
those who are trying to help is not going to benefit any one person, is 
not going to benefit any group. Certainly it is not going to be able to 
give us the opportunity to be able to deal with these programs in the 
future.
  Just throwing more money at programs, my goodness, you would think 
somebody would get real, get a more creative budget than this just to 
throw more money at things and assume that they are actually going to 
work. We need to reform these programs.
  Last year, for the first time in nearly a decade, we took the first 
step to reform some of these largest programs. We saved $40 billion in 
the process. We allowed better delivery of these programs to the people 
they were intended for.
  This year's budget will continue to build on those savings by yet 
again reforming the mandatory programs and establishing that we should, 
on an annual basis, reform government, even if it is a small amount.
  I know people around here say why are you bothering with $6.8 
billion. Well, that may be small to some of you, but it is not small to 
the taxpayers who have to pay the bills around here. This budget will 
continue to build on those savings by, again, reforming mandatory 
programs and establishing this annual process.
  Finally, let me talk about reform, which this budget is based on. To 
some extent, we are still learning lessons from Hurricane Katrina. We 
should continue to always learn the lessons; but one of them that 
became, I think, very clear is that if we do not control

[[Page 5407]]

spending, if we do not get good control of spending, it becomes very 
difficult to manage unforeseen events that inevitably face us.
  One certainly could have foreseen that we were going to have a 
hurricane. We have them every year. We have them every year that I have 
been in Congress; but no one, no one, could have foreseen the 
devastation that has occurred as a result of Hurricane Katrina, and no 
one would have expected it to be built into anybody's budget. We did 
not build it into ours. The President did not build it into his. 
Certainly the Democrats did not build it into theirs. In fact, this 
year they build no money into their budget for emergencies.
  Now, wait a minute. I realize this may surprise you. It was in all 
the papers. We had a disaster last year. We had an emergency. We had a 
hurricane. Not just a little one, but a big one. Why do we not at least 
plan for the little ones? Let us at least plan for the disasters that 
we know are coming.
  Mr. FORD. We have the same amount of emergency spending that you 
have, Mr. Chairman.
  Mr. NUSSLE. Mr. Chairman, I believe I have the time, and I have not 
yielded.
  The CHAIRMAN. The gentleman from Iowa has not yielded.


                         Parliamentary Inquiry

  Mr. FORD. Parliamentary inquiry. Who signed the welfare reform bill 
that was passed last century?
  The CHAIRMAN. Does the gentleman from Iowa yield?
  Mr. NUSSLE. No, I do not.
  The CHAIRMAN. The gentleman from Iowa has the floor.
  Mr. NUSSLE. Mr. Chairman, I appreciate that.
  So while we are continuing to learn the lessons, Congress needs to 
plan for it. Congress needs to plan for these emergencies, and our 
budget does that. This year, not only will we build in a reform of our 
mandatory programs and further restrain our nonsecurity discretionary 
spending, but we need to reform the budget process as well to reflect 
the actual spending that is currently spent outside of that normal 
budget process, and it is called emergency spending, for many natural 
disasters where appropriate spending is certainly necessary.
  In addition to emergency reforms contained in this budget, we will 
continue the process of reforming the budget and reforming the budget 
process and how we make spending decisions throughout this year. We 
need to tackle earmarks. We need to tackle the sunsetting of programs 
that have outlasted their usefulness. We need to deal with line-item 
veto, and we will do this throughout this year.
  Let me just end by saying this. I do not think I need to remind 
anybody about the massive challenges and changes that our Nation has 
endured these past few years or the myriad of challenges that lie 
ahead. We have had enormous challenges in writing the budget. I do not 
shy away from any of them. I know it would be easy for somebody to just 
punt.
  Well, we decided we were going to meet each one of those challenges 
and deal with them, and every single year we have had a plan. Finally, 
this year, the Democrats rushed to the floor with a plan and suggest 
that they finally now have an idea on how they are going to balance the 
budget. We will take a look at that a little bit later.
  But we have had a plan every year, and our plan has worked, and we 
have been able to manage our deficits and our debt and our taxes and 
our economy and deal with so many important priorities in an 
appropriate way. We have kept our country going when many people, after 
some of these disasters, said our economy was going to collapse, that 
we were not going to be as powerful as we were in the past; but because 
of the leadership we have provided, much of which started in these 
blueprints, we believe we have been able to keep our country growing 
and growing strong.
  We have seen how the Nation's most fundamental priorities have 
shifted dramatically, some by circumstance, some by choice, but they 
have shifted; and we have managed through the process as best as we 
could.
  For the past three budgets, after recovering from the initial shock 
of 9/11, we have set a bold plan to shore up and strengthen our defense 
and homeland security, to get and keep our economy growing strong and 
creating jobs and controlling spending and continuing the process of 
reform and reducing the deficit, and the deficit has reduced.
  We followed that plan, and adjusting it to last year, making a down 
payment on the immense new hurricane spending. We have made real 
progress.
  But last year's hurricane served as a stark reminder that controlling 
the budget does not just happen one day out of the year. It is a long-
term, step-by-step commitment that takes resolve. It takes more than 
one person to do it. It takes particularly in extraordinary 
circumstances a plan, and that is what we present today, our plan for 
fiscal year 2007.
  We need to pass it. We need to stick to it. We need to enforce it. 
Certainly if there are challenges, we need to adjust to it, but we need 
a plan. We need to work the plan. We need to enforce the plan, and we 
need to pass the plan today.
  Mr. Chairman, I reserve the balance of my time.
  Mr. SPRATT. Mr. Chairman, I yield myself 2 minutes.
  I said earlier that this is an excellent opportunity to show the 
difference between Democrats and Republicans. This document does that; 
but with respect to national defense, function 050, there is no 
difference, because to the dollar we have provided the same amount of 
funding as the Republican resolution. There is no difference.
  On the other hand, with respect to education, there is an enormous 
difference because the Republican budget resolution cuts education by 
$45 billion over 5 years below what we call the level of current 
service, staying where we are. Last year, for the first time in 17 
years, the President requested less for education in 2006 than was 
appropriated in 2005; and this year, he asked for an even larger 
reduction, $2.2 billion less in 2007 than appropriated for 2006, and 
these cuts come on top of big cuts, crippling cuts in federally 
guaranteed student loans.
  To discuss further the impact and consequences of these enormous cuts 
in education, which our resolution does not provide for--we fully 
restore education to current services, fully restore the cuts they 
would make--is Ron Kind of Wisconsin, a member of the Education 
Committee, and I yield him 6 minutes for that purpose.
  Mr. KIND. Mr. Chairman, I want to thank my good friend from South 
Carolina for the leadership he has provided on the Budget Committee, 
and we do want to take a moment to talk about the priorities of our 
country, especially when it comes to the investment of the future of 
our country, and that is the education of our children.
  Mr. Chairman, our country is going to face two of the greatest 
challenges in the history of our Nation in this century. One is 
securing our Nation against the global threat and the global capability 
of international terrorism, but, secondly, it is our ability to remain 
the most innovative and creative Nation in the world. That requires an 
investment in our children and the quality of education that they are 
exposed to.
  It is something that we do in our budget alternative, and we do it by 
operating under pay-as-you-go rules that will restore us to balance 
again by 2012, but by maintaining that important investment in our 
children's education.
  Their budget punts, in fact, their numbers track the President's 
recommended budget, which calls for the elimination of 42 education 
programs in our country, including vocational education, gone; Perkins 
loans, gone; Safe and Drug Free Schools, eliminated; education 
technology and Even Start, eliminated, in what the President is calling 
for in the budget.
  We can do a better job with our alternative, and we would encourage 
our colleagues to support it.
  Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman from 
Connecticut (Ms. DeLauro), a real champion of our children and to 
education in this country.

[[Page 5408]]


  Ms. DeLAURO. Mr. Chairman, this budget contains massive deficits for 
our children and unaffordable tax cuts for the wealthiest Americans at 
the expense of middle-class families. Particularly damaging are the 
cuts to critical services in education, workforce development, health, 
veterans services, and environmental protection.
  It fails to include an additional $7 billion so that in fact we can 
fund education and health and the other services in the same way that 
the Senate, by a vote of 73-27, voted a few weeks ago, funding for the 
Community Services Block Grant, Low-Income Heating Assistance, National 
Institutes of Health and Pell Grants, programs that touch virtually 
every community health center, hospital, school district, and 
employment center in the Nation.
  Last week, I proposed an amendment that would restore this $7 billion 
when the Budget Committee met. It was rejected by this Republican 
majority on a party-line vote, and what we are left with are cuts that 
would cut cancer research by $40 million.
  We tell our kids today, you need to have a post-secondary degree; you 
no longer have the luxury of just having a high school diploma because 
we exist in a global economy. What they will do is to eliminate more 
than 40 education programs, all Federal vocational and technical 
education programs. They freeze the Pell Grant.
  Education has been about opportunity. They will deny the opportunity 
of our youngsters to be able to get a college education.
  That is what this budget does. These are Republican priorities. They 
are not the American priorities. It is a misguided and it is an immoral 
budget, and we ought to support the Spratt substitute.
  Mr. KIND. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman 
from California (Ms. Woolsey), a real leader on the Education Committee 
and a champion for our children throughout the country.
  Ms. WOOLSEY. Mr. Chairman, we need to put sanity back into the 
Nation's fiscal policies, and this Republican budget just does not do 
that. In fact, we continue with their policies to fill the pockets of 
the defense contractors while leaving only pennies for nearly every 
other priority of this country.
  That is why I offered an amendment to the budget that would trim $60 
billion in waste from the Pentagon budget, not a single penny, by the 
way, from the wars in Iraq and Afghanistan, and put these savings to 
work on behalf of the people and programs that truly strengthen 
America.

                              {time}  1400

  By cutting outdated and unused weapon systems that were designed to 
fight the Cold War, relics that have no place in today's modern 
military, we could invest in our national priorities, like education. 
We could be rebuilding and modernizing our public schools, or we could 
be making up for the President and the Republican Congress's $55 
billion of underfunding for No Child Left Behind.
  The savings would also be spread to homeland security, cutting the 
deficit, a skilled and educated workforce, healthy children, less 
dependence on fossil fuels, better fire departments, scientific 
progress, and less debt. That is what makes America strong and safe.
  Enough is enough, Mr. Chairman. It is time we invested in our kids 
and their education, not in Cold War relics. Vote against the 
Republican budget.
  Mr. KIND. Mr. Chairman, I yield such time as she may consume to a 
real leader on education and workforce development issues, the 
gentlewoman from Pennsylvania (Ms. Schwartz).
  Ms. SCHWARTZ of Pennsylvania. Mr. Chairman, I rise to reject the 
borrow and spend policies included in the Republican budget, a budget 
that fails to balance the Federal checkbook, ignores our obligations to 
Americans, and heaps debt on our children and grandchildren at the rate 
of $1 million a minute.
  Mr. Chairman, our budget, the Democratic alternative, would balance 
the Nation's budget by 2012 through fiscal discipline, something the 
Republicans refuse to do. And in contrast to the Republican budget, we 
would make the important investments in homeland security, health care, 
and services for our veterans.
  Specifically on education, we would restore what the Republican 
budget does not do. The Democratic budget would in fact invest in 
educating our children. It would meet our Federal obligations under No 
Child Left Behind and under special education, and it would not pass 
along these costs to our local and State governments. It would help 
young adults be able to get the advanced education needed to have the 
skills and the technology to be able to compete in the 21st century.
  We should reject the Republican budget and support the Democratic 
alternative.
  Mr. NUSSLE. Mr. Chairman, I yield 2\1/2\ minutes to the distinguished 
chairman of the Veterans' Affairs Committee, the gentleman from Indiana 
(Mr. Buyer).
  Mr. BUYER. Mr. Chairman, this budget with regard to the funding of VA 
is derived from what I call the crucible of hard lessons. I chose to 
leave the Veterans' Affairs Committee to examine the budget modeling 
issues for the VA.
  A budget shortfall was exposed last summer. VA Secretary Nicholson 
and OMB, to their credit, stepped up to the plate, taking 
accountability for a flawed budgetary process. Their improved use of 
timely data, methodology, and balanced policy expectations are 
reflected in the President's budget request for the VA.
  The budget before us today reflects our priorities: To care for 
veterans who need us most, those hurt and disabled by their military 
service, those with special needs and the indigent; to ensure a 
seamless transition from military to civilian life, and to provide 
veterans with economic opportunity to live full and complete lives.
  The veterans spending has increased from $48 billion in 2001 to 
approximately $70 billion this year. At a time of tough budget choices, 
when in most Federal spending we see few, if any, increases, veterans 
spending will rise next year by 12 percent. With the Nation at war, 
this is altogether fitting.
  We have heard the rhetoric that describes an increase as a cut, but 
truly this budget continues a decade-long record of leadership under 
this majority. I refer here to the chart that shows the historic 
increases, from the $17.6 billion in 1995 to now $33.8 billion for 
discretionary spending alone. This is a far cry from the flat-lined 
budgets that we were receiving during the Clinton years.
  We have increased the access to quality care, with more than a 
million veterans using the VA than they did 5 years ago. But challenges 
remain. The VA must decrease its claims backlog with regard to benefits 
claims, which exceeds around 800,000. Centralizing the VA's information 
technology structure is very important. You can't just measure 
compassion by the dollar. It is how we look at the operations of 
government. And centralizing the VA's information technology could save 
an estimated $1.2 billion over 5 years, according to testimony by 
Gartner, the consultant.
  Also, to achieve a seamless transition to our new veterans in the VA, 
VA and DOD must fully share in the electronic medical records. This is 
extremely important and there is good progress in this area.
  I want to continue to work with the chairman of the Budget Committee 
on issues of modernizing the GI bill, which we have discussed, and also 
the issue with regard to the estimate that the administration used with 
regard to collections. It is an issue I will work with the chairman on 
as we go to conference with the Senate and, hopefully, we can get that 
worked out.
  I want to applaud the chairman's efforts on behalf of America's 
veterans. This is a good budget.
  Mr. SPRATT. Mr. Chairman, I yield myself 1 minute.
  Mr. Chairman, with respect to veterans' health care there is also a 
big difference. The President's budget funds veterans' health care at 
$12.5 billion below the Democratic Alternative

[[Page 5409]]

over 5 years, and on top of that the President calls for veterans to be 
assessed a $250 fee to enroll for care at a VA Hospital.
  In the markup in our committee, House Republicans raised funding for 
2007 by $2.6 billion above current services. But from 2008 through 
2011, the Republican budget resolution cuts veterans' health care by 
$8.6 billion less than what CBO estimates is needed to maintain current 
services. By contrast our resolution, the Democratic resolution, 
maintains funding every year at the CBO level of current services from 
2008 through 2011.
  Here to discuss further the impact of the two budgets upon veterans' 
health care is a Member who knows all about this. He is the ranking 
member of the appropriations subcommittee with jurisdiction on this 
matter.
  Mr. Chairman, I yield 6 minutes to the gentleman from Texas (Mr. 
Edwards).
  Mr. EDWARDS. Mr. Chairman, I have had the privilege of representing 
over 40,000 Army soldiers who fought in Iraq. I have seen firsthand 
their sacrifices and the sacrifices their children and spouses have 
made on behalf of our country. That is why I believe we have a moral 
obligation to support our veterans and our military retirees, and we 
should support them not just with our words but with our deeds.
  It is the right thing to do, because our veterans have kept their 
promise to defend our country and we should keep our promise to provide 
health care for them. And it is the smart thing to do, because if we 
break our promises to our veterans and military retirees we will never 
recruit the best and brightest of the younger generation to fight our 
war on terrorism.
  That is exactly why I am adamantly opposing this budget. While on the 
issue of veterans it has a 1-year fig leaf plus-up of VA health care, 
for which I am grateful and supportive, the fact is that this budget 
resolution would cut present services for veterans' health care by over 
$5 billion over the next 5 years. That is right, this budget resolution 
would cut veterans' health care services during a time of war. If that 
is not immoral, I do not know what is.
  The fact is that it is even worse than that, because the 
Congressional Budget Office baseline assumes there is no net increase 
in the number of veterans going into the VA health care system every 
year. So if you build in 100,000-plus additional veterans we have had 
in that system each year, the cut is even deeper than $5 billion to 
veterans' health care during a time of war.
  Let us talk about military retirees, men and women who have served 
our country in uniform, gone into harm's way, served in the military 
more than 20 years, many of them over 30 years. What does this budget 
do to them? It puts in effect a tax on military retirees' health care. 
For retired military officers this would amount to nearly a $1,000 a 
year retiree health care tax, and for enlisted retirees a $500 a year 
tax on the military retiree health care premiums.
  Does it ask Members of Congress to triple our health care premiums? 
No. Does it ask members of the President's cabinet to triple their 
health care premiums? No. What this budget resolution does say is that 
those of you who have served our country for 20 or 30 years in the 
military, you are going to have to suck up the burden. You are going to 
have to pay for the cost of this Republican budget.
  I don't think that is fair, and I don't think the American people 
will think it is fair. I certainly know the Military Officers 
Association of America, the Disabled Veterans Association, and numerous 
veterans organizations have said this is not fair.
  Let me just quote Joe Violante, the Legislative Director of Disabled 
American Veterans, on this proposal. ``Providing needed medical care to 
military retirees is a continuing cost of national defense and is our 
Nation's moral obligation. No condition that military retirees be 
forced from a benefit they were promised is acceptable, especially in 
these times.''
  What did the Budget Committee do? On a party line vote they voted 
down my amendment that would have said no to the administration's 
proposal to triple these military retirees' health care premiums over 
the next 2 years. We could have said ``no'' to that unfair burden, but 
my Republican colleagues on the committee voted against my amendment. 
By doing so, they assume the President's extra revenue from those 
health care premium increases and put that into their budget.
  Cutting veterans' health care by over $5 billion in the next 5 years 
during a time of war, putting a tax on health care premiums for 
military retirees is no way to show respect for our military or to 
strengthen America. That is why we should say ``no'' to this budget 
resolution.
  Mr. Chairman, I reserve the balance of my time.


                  announcement by the acting chairman

  The Acting CHAIRMAN (Mr. Foley). The gentleman from Texas may not 
reserve time. The remaining 2 minutes are yielded back to the gentleman 
from South Carolina.
  Mr. NUSSLE. Mr. Chairman, I yield 2 minutes to a distinguished member 
of our committee, the gentleman from Texas (Mr. Conaway).
  Mr. CONAWAY. Mr. Chairman, I would like to talk a little about the 
role of government in a growing economy.
  To my way of thinking, that role is to just basically get out of the 
way. A growing economy is one in which the Tax Code is in a 
circumstance where it is not an overt burden on it. Not to say that our 
current Tax Code is perfect, by any stretch of the imagination, but 
these low tax rates and these tax concepts we put in place in 2001 and 
2003 have in no small part added to the growing economy that we 
currently have.
  We don't want to talk today about the regulatory burdens and 
interference that families and businesses have from government, but 
those should be counted in the cost as well and get those out of the 
way.
  When you put the pro-growth policies in place that we have had, you 
get some startling results. We have 17 straight quarters of growth, as 
measured by the GDP. We have 5 million new jobs that have been created. 
Unemployment across the Nation is at 4.8 percent, which many think is 
full employment. Actually, in District 11, which I represent, the 
unemployment rate is zero, for anyone who wants a job. And a record 
number of Americans are working today. A record number of Americans are 
working and paying taxes.
  A little aside on the importance of a job, I spent a lot of time in 
west Texas working on United Way issues and other social service 
issues, and it has been my experience that when a family has a job that 
family is better off. That family is able to provide for itself, to 
make its own decisions about how it wants to conduct its life, and when 
those individual families are better off then the neighborhoods are 
better off and the communities are better off as well. So 5 million 
jobs should not go unnoticed as a startling number in a growing 
economy.
  In conclusion, I think we see that the pro-growth tax policies we 
have put in place have created record revenues. We will collect more 
money this year than in any other year in our Nation's history, 
collecting and growing it in the correct way, more taxpayers paying tax 
rates at a lower number.
  What we have is a spending problem and not a revenue problem. This 
budget addresses discretionary spending in a modest way, and it also 
addresses the mandatory spending in an even more modest way. But they 
are steps in the right direction, and this new mandatory spending will 
be the first time ever we have done it twice in a row, and I urge my 
colleagues to support this budget resolution.

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