[Congressional Record (Bound Edition), Volume 154 (2008), Part 3]
[House]
[Pages 3893-3910]
[From the U.S. Government Publishing Office, www.gpo.gov]




        CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 2009

  The SPEAKER pro tempore. Pursuant to House Resolution 1036 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the state of the Union for the further consideration of the 
concurrent resolution, H. Con. Res. 312.

                              {time}  1822


                     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 further consideration of 
the concurrent resolution (H. Con. Res. 312) revising the congressional 
budget for the United States Government for fiscal year 2008,

[[Page 3894]]

establishing the congressional budget for the United States Government 
for fiscal year 2009, and setting forth appropriate budgetary levels 
for fiscal years 2010 through 2013, with Mr. Altmire (Acting Chairman) 
in the chair.
  The Clerk read the title of the concurrent resolution.
  The Acting CHAIRMAN. When the Committee of the Whole rose earlier 
today, the gentleman from South Carolina (Mr. Spratt) had 23 minutes 
remaining and the gentleman from Wisconsin (Mr. Ryan) had 32\1/2\ 
minutes remaining.
  Mr. SPRATT. Could the Chair please inform us of the time allotted to 
the gentleman from New Jersey (Mr. Andrews), how much remains 
available.
  The Acting CHAIRMAN. The gentleman from New Jersey has 4\1/2\ minutes 
remaining.
  Mr. SPRATT. I yield to the gentleman the balance of his time.
  Mr. ANDREWS. At this time I am pleased to yield to the gentlewoman 
who has been a leader on child support efforts for purpose of a 
colloquy, the gentlewoman from Wisconsin (Ms. Moore).
  Ms. MOORE of Wisconsin. I thank the gentleman from New Jersey.
  The Democratic budget resolution is a lifeline to families during 
this economic downturn. One aspect of the chairman's mark before us 
calls on Congress to restore the harmful cuts made to the Child Support 
Enforcement program, and as a result of the only bipartisan amendment 
brought forth by the ranking member and me, it restores the ability of 
States to pass along every cent of child support collected to families 
rather than nickeling and diming them out of this child support to make 
repayments to government bureaucracies.
  Since we have demanded that parents move off welfare and take 
financial responsibility for their families, child support has become 
the premier safety net for children. Therefore, Congress should make 
every effort to ensure that child support is collected and that all of 
it goes to families.
  The Child Support Enforcement program collected more than $24 billion 
for 17 million children participating in the program in 2006. The Child 
Support Enforcement program doubled its collection rate in the past 10 
years and is consistently among the Office of Management and Budget's 
top-rated government programs. Why? Because research has shown that it 
is a very cost-effective program, that for every $1 spent on child 
support enforcement, $6.50 of child support is collected.
  With this budget resolution, which restores the Child Support 
Enforcement cuts, the Congressional Budget Office estimates that $11 
billion in child support payments would go uncollected over the next 10 
years, even if States backfilled half of the lost Federal funds.
  Additionally, Child Support Enforcement supports domestic violence 
services and initiatives to help fathers work, support their children 
and stay out of prison. Families need their child support payments to 
pay for their children's basic needs because children represent a 
disproportionate share of the poor in the United States. While they are 
only 25 percent of the population, they represent 35 percent of the 
poor. Loss of child support income could not come at a worse time for 
families. Their ability to make ends meet has already been battered by 
unemployment, rising gas and home energy costs and rising food costs.
  Mr. RYAN of Wisconsin. If the gentleman would yield, I simply wanted 
to chime in and compliment the gentlelady as well, my friend from 
Wisconsin. She and I coauthored an amendment to this budget resolution 
on this issue.
  It makes no sense for child support payments not to go to the 
children. That is unfortunately what is happening today. And I would 
very much like to work with the gentlelady and anybody who is 
interested in coming up with the offsets in the Ways and Means 
Committee, from which this jurisdiction derives, to find a way to fix 
this problem. I think this is an area that has wide bipartisan support. 
And this is one of those areas where I surely would like to think we 
can come up with the savings to fix this injustice.
  I appreciate the gentleman yielding.
  Mr. SPRATT. That was one amendment that was agreed to in the markup, 
and I think it would behoove us all, the gentlelady particularly, if we 
get together and see if we couldn't move the legislation. That would be 
great.
  Mr. ANDREWS. I thank the gentlelady for her contribution.
  Ms. MOORE of Wisconsin. And I thank the ranking member, the chairman 
and all of the members of the Budget Committee for looking at this very 
serious issue.
  Mr. ANDREWS. At this time I would like to engage in colloquy the 
gentlelady from New Hampshire who has seen firsthand the ravages of 
neglect of people out in the community when you don't fund important 
programs, and I know she supports this budget because it does, Ms. 
Shea-Porter.
  Ms. SHEA-PORTER. Thank you for the time, and I thank Chairman Spratt 
and the Budget Committee for producing a fair and responsible budget, a 
moral document that is fiscally responsible.
  Mr. Chairman, I have been deeply concerned about the President's 
proposed cuts to the Low-Income Home Energy Assistance Program known as 
LIHEAP. LIHEAP provides critical assistance to millions of families in 
America. Every winter, tens of thousands of families in New Hampshire 
rely on this program to heat their homes. Over 40,000 members each year 
for the past 2 years have applied to the fuel assistance program for 
help with heating bills. This winter, the average cost of heating a 
home with heating oil is expected to climb to over $2,000 per family, 
more than three times the $627 that it cost just 6 years ago. But 
LIHEAP has not failed to keep pace with the dramatic cost. It has 
actually dropped.
  The Acting CHAIRMAN. The gentleman from New Jersey's time has 
expired.
  The gentleman from South Carolina has 18\1/2\ minutes remaining.
  Mr. SPRATT. Does the gentlewoman require further time?
  Ms. SHEA-PORTER. Yes.
  Mr. SPRATT. I yield to the gentlewoman 1 additional minute.
  Ms. SHEA-PORTER. For fiscal year 2009, the President proposed just $2 
billion for LIHEAP, a $570 million painful cut from what Congress 
provided for 2008. This irresponsible cut could force New Hampshire to 
lose over $2.5 million in funding next year.
  I applaud the committee for rejecting these proposed cuts and for 
increasing funding for LIHEAP and other programs that will help the 
middle-income and lower-income families in New Hampshire and across the 
country. And I thank you.
  Mr. RYAN of Wisconsin. Mr. Chairman, may I inquire as to how much 
time remains between the two sides.
  The Acting CHAIRMAN. The gentleman from South Carolina has 17\1/2\ 
minutes remaining. The gentleman from Wisconsin has 32\1/2\ minutes 
remaining.
  Mr. RYAN of Wisconsin. At this time, Mr. Chairman, I would like to 
yield 6 minutes to the gentleman from Texas (Mr. Hensarling), a senior 
member of the Budget Committee.

                              {time}  1830

  Mr. HENSARLING. I thank the ranking member for yielding, and I am 
sorry that my friend from New Jersey has apparently left the floor. No, 
I see him there. We had the occasion to debate this budget earlier 
today. I believe that he just said every Republican voted against OBRA 
in 1993 and that is what unleashed economic growth, but if I did my 
homework correctly, I think the gentleman from New Jersey voted against 
it as well. I would be happy to yield to the gentleman if I was 
incorrect in my assertion.
  Mr. ANDREWS. Mr. Chairman, will the gentleman yield?
  Mr. HENSARLING. I yield to the gentleman from New Jersey.
  Mr. ANDREWS. I mostly certainly did, and I am about to say something 
that I think the chairman can confirm we very rarely hear around here. 
I was

[[Page 3895]]

wrong. You see, I thought what you guys now think. I thought that an 
increase in the top marginal rates would, as the former Speaker at the 
time said, cause a recession in the country, and the evidence showed it 
didn't happen. And I am willing to admit that that is a vote I should 
have cast the other way, and I was wrong to do it, and so were all your 
guys.
  Mr. RYAN of Wisconsin. If the gentleman would yield, it is also 
interesting that after that tax increase, from that tax bracket, the 
Federal Government actually brought in less money under those higher 
tax rates.
  Mr. HENSARLING. Well, I thank the gentleman once again for yielding.
  There is a big question again about tax increases, and I have heard 
many of my friends on the other side of the aisle argue that there is 
no tax increase included in their budget; yet, Mr. Chairman, they claim 
that they are going to balance the budget in 2012. Well, the only way 
they can do that is by capturing all these tax revenues.
  Now, some of them use very clever Washington language. They say, 
well, we are not raising taxes on working men and women in America. We 
are just letting tax relief expire.
  Well, that is a very fine distinction that is lost upon the working 
men and women of America. I mean, there is this odd quirk in Washington 
that somehow spending is forever and it grows exponentially at the 
expense of the family budget, and yet tax relief somehow is temporary.
  The bottom line is that very soon, within two budget years, there is 
going to be a massive tax increase upon the American people. There will 
be, again, the largest single tax increase in American history. Now, we 
were just talking about the earlier record when the Democrats were in 
control of Congress of $241 billion. The tax increase they are 
proposing now will dwarf that, $683 billion, the largest tax increase 
in American history.
  Again, they want to claim credit for balancing the budget, and I 
certainly salute their goal. The Republican budget, it balances the 
budget without tax increases. But if you look and actually read the 
numbers, and ultimately the numbers are the only thing you can count on 
in a budget, well, Mr. Chairman, this is their budget right here. That 
is them taking in all of these tax increases. That is how they claim to 
balance the budget. So, again, there is going to be huge, massive tax 
increases, scheduled, automatic tax increases. The Republican budget 
prevents those tax increases from coming into fruition.
  Now, I have heard our chairman, and I have the greatest amount of 
respect for the chairman, say on many occasions, well, you know, this 
is the way the law was written. But, Mr. Chairman, if I did my homework 
correctly, there have been at least 21 different occasions over the 
last 5 years to make sure that these automatic tax increases on 
hardworking American people didn't take place. And as I look at the 
voting record, the overwhelming majority of Democrats voted to make 
sure that these tax increases do take place, so I am sure they don't 
want to admit to the American people that they are raising taxes. But 
they are.
  So, Mr. Chairman, what is going to happen? Well, let me tell you what 
is going to happen under this Democrat budget.
  Number one, 116 million taxpayers will see an average tax increase of 
more than $1,800 per year.
  More than 6 million low-income individuals and couples who currently 
pay no taxes, no taxes, will no longer be exempt and will have to start 
paying income taxes.
  A family of four earning $50,000 will see their taxes increase by 
$2,100.
  Low-income families with one or two children will no longer be 
eligible for the refundable child tax credit in 2011.
  Tax bills for an estimated 27 million small business owners will 
increase by more than $4,000 each.
  Mr. Chairman, I was a small businessman before I came to Congress, 
and let me tell you, excess taxation prevents small businesses from 
creating jobs. A job is the greatest housing program, nutritional 
program, and educational program in the history of mankind. It is a 
paycheck, not a welfare check. Yet the Democrat tax increase is a 
dagger aimed at the heart of small business throughout our Nation.
  The capital gains tax is going to go up 33 percent, the capital of 
capitalism. If you want to be able to have job growth, you have to have 
capital. Taxes on dividends go up 164 percent under their plan.
  Mr. Chairman, the death tax, that is a tax that is immoral. It ought 
to be illegal. It goes away, and under this Democrat budget, it comes 
back as high as 55 percent.
  The child tax credit is cut in half. The lowest tax bracket is 
increased 50 percent.
  These are just the tax increases that have been passed into law. How 
about the others that the Democrats attempted to pass? H.R. 6 attempted 
to increase taxes $7.7 billion. H.R. 976 attempted to raise taxes $1.4 
billion; H.R. 3963 tried to raise taxes $71.5 billion.
  Now we have Chairman Rangel of the Ways and Means Committee wanting 
to raise taxes trillions of dollars in the years to come for the AMT. 
We have a 50 cent increase in gasoline tax recommended by the Energy 
and Commerce chairman, Mr. Dingell of Michigan, and an additional 5 
cent increase per gallon gas hike proposed by Representative James 
Oberstar, chairman of the Transportation and Infrastructure Committee.
  There is no getting around it. This is the largest single tax 
increase on American history. It is going to cost American families an 
average of $3,000 a year as they try to educate their children, as they 
try to keep a roof over their head, as they try to realize their 
American Dream.
  Mr. RYAN of Wisconsin. Mr. Chairman, at this time I would like to 
yield 4 minutes to the gentleman from Michigan (Mr. McCotter), the 
chairman of the Republican Policy Committee.
  Mr. McCOTTER. Mr. Chairman, I come from Michigan, a State that 
respects honesty, even when one is in error, so I must admit that I was 
pleasantly surprised by the integrity, if not the ultimate decision, 
that we heard from the gentleman from New Jersey.
  We heard a lot about change over the course of a year or two, and I 
too must be honest. We have seen change in how Washington budgets. We 
have seen change. We have gone from bad to worse.
  Now, as I recall sitting in Michigan, living there with my wife and 
children, I have seen a similar instance out of my State government 
which, in a one-State depression, faced the choice of allowing working 
families to keep their money and protect their budgets or raising taxes 
and protecting the State budget.
  They started with the smokers. They went after them. They took their 
money. Nobody likes smokers. Who cares? Then they had a one-time-only 
property tax advance. They never did tell us when the property tax 
relief comes, but I am sure one day it will. It is only once. And then 
they raised our income taxes. They raised our income taxes because by 
then it was for the greater good. And whose family budget wants to stay 
in the way of the greater good? Certainly not somebody like me, 
somebody whose children are looking at college, somebody whose mother 
may be getting older and may need care, somebody who worries that their 
dreams of their future for their children might go up in ashes in a 
State that is mismanaged by a government that cares more about itself 
than it cares about the sovereign citizens who elected it.
  And then I come out here to do their work as their servant and I see 
the same thing. I see the same thing. I hear the same talk. I see the 
change that was promised and delivered. The sad part is the promise was 
implied.
  I remember hearing the government spent too much. Got to stop. The 
government spent too much. We are going to change that. I didn't hear 
the part where you said the government spends too much. We are going to 
spend more.
  I heard people talk about working families struggling, and we are 
only going to tax the rich. We are only going to tax the rich. 
Evidently we

[[Page 3896]]

must not be doing too well. There is not enough rich to back up the 
promises. So what do we do? The largest tax increase in American 
history on everybody. Well, that is a change. I concede the point. It 
is a change.
  But I was shocked again with both the honor and the erroneous 
conclusion of the gentleman from New Jersey. I never in my life 
expected to see a Member of Congress apologize for not raising taxes on 
the American people. That is a change. I grant you that.
  The question is then, if the American people need to have their taxes 
raised to come into prosperity, surely you know what the ultimate 
number is. How high, how fast until we get to prosperity? How much more 
of my money has to go the Federal Government before I can dream for my 
family and feed them? Surely somebody must know that number.
  Is this largest tax increase in American history going to be the 
last? Are we then going to reach the American Dream? Are we going to 
have our liberty and economics to pursue that dream through our own 
works, or will government have to do that for us? Are we going to get 
bureaucrats as life coaches? What is going to be necessary? Give me a 
number. I haven't heard that number. I haven't heard that percent.
  I think the one thing that we do need to change immediately right now 
in rejecting this budget scheme to bloat, to soak your family budget, 
to bloat the Federal Government's budget, is I want to hear somebody 
admit that America's economic prosperity comes from our free people, 
not from the growth of government, for that is a truth to hear that 
would be a refreshing change of late.
  Mr. RYAN of Wisconsin. Mr. Chairman, I yield 3\1/2\ minutes to the 
gentleman from Arizona (Mr. Flake).
  Mr. FLAKE. I thank the gentleman for yielding.
  Mr. Chairman, I rise today in opposition to the budget resolution. We 
have received repeated warnings about Medicare and Social Security, 
that they are on their way to insolvency. I think we all know that. In 
fact, CBO recently projected that Social Security will begin to pay out 
more than it takes in by the year 2020, and at the same time Medicare 
spending will likely double over the next 10 years.
  But inexplicably, this budget does nothing. It contains no action 
over the next 5 years to change this course. Instead, it would allow 
the unfunded liabilities of both of these programs to grow from almost 
$39 trillion today to about $52 trillion by 2013. That is a 2 to $3 
trillion increase every year. This means that over the next 5 years 
alone, every American household will be responsible for more than 
$450,000 to keep these programs functioning as is.
  We can't ignore this ever-increasing, this massive problem. I have 
seen reports, press reports, that Medicare and Social Security aren't 
the priorities anymore. I would submit that, if we don't start working 
on a real solution, the taxpayers will quickly see either drastic cuts 
to their benefits or a spike in their taxes, unless we change the trend 
that we have.
  Mr. Chairman, I am disappointed that instead of confronting this 
issue, we are again burying our heads in the sand. It is not realistic. 
We can't continue to do this. It is a huge disservice to everyone in 
this country. I must oppose this budget.
  Also let me say, it is not just the level of spending that is 
problematic; it is the type of spending. We have had a lot of arguments 
lately about earmarking. This budget, the Democratic budget, does 
nothing to change the practice. Last year we had some $15 billion spent 
on earmarks, and a lot of those earmarks were never vetted on the House 
floor. In fact, the vast majority of them, 99 percent of them, were 
never given a thorough vetting on the House floor, and, in fact, about 
a billion dollars, just under a billion dollars was spent on earmarks 
that were air-dropped into the conference reports that never got any 
vetting at all, that was never subject to any House decision. That is 
nearly $1 billion. But what do we have in this budget to prevent that? 
Nothing. Nothing. We are on track to do it again or perhaps even worse.
  We have got to do better, both on the level of spending and the type 
of spending that we are doing. In Congress, we have had a process for 
centuries called authorization, appropriation, and oversight, and over 
the past several years we have gotten away from that. Instead, we do 
very little authorizing, a lot of appropriating, and very, very little 
oversight.
  There is nothing in this budget to change that process. We are doing 
the same. And the Democrats will say, hey, over the past several years 
you Republicans have done wrong as well. And we have. That is the 
biggest reason we are here in the minority today. But at least you 
could say it took Republicans awhile to get to this point. In the 
meantime, there were balanced budgets. There was the reformation of 
welfare. There were some good things that happened. Then we got 
fiscally lazy and we started having budgets much like this, and the 
voters turned us out, as I would suggest they will do to the majority 
party, who got into this much more quickly than Republicans did.
  I hope that they change. I would like nothing more than to support a 
good budget here, but this is not, and I would urge my colleagues to 
reject it.

                              {time}  1845

  Mr. RYAN of Wisconsin. Mr. Chairman, I would like to yield 3 minutes 
to the gentleman from Texas (Mr. Culberson).
  Mr. CULBERSON. Thank you, Mr. Ryan.
  Mr. Chairman, the American people face the greatest financial 
challenge we have ever encountered in the history of the Nation. The 
free people of Great Britain overcame the greatest challenge they ever 
faced in their history during the early days of the Second World War 
because Winston Churchill told them the truth.
  They won the Battle of Britain because they were told by their 
leaders the truth, and they could deal with the truth as Americans can 
deal with the truth, but we have got to be told the truth. Today at 5 
o'clock, unfortunately, one of our great public servants retired, the 
Comptroller General of the United States. David Walker, when he left 
work today, has moved on to the private sector.
  David Walker is a great public servant who has told the truth, and I 
want to reiterate it here on this House floor, how urgently important 
it is for the majority that now that controls this House to step up and 
accept responsibility for dealing with this great financial challenge 
that David Walker has laid out for us that we in the old Republican 
majority lost the majority because we did not deal with it.
  That's why you saw conservatives like me and many of my colleagues 
here today vote against Medicare prescription drugs, vote against the 
farm bill, vote against all the expansions of the government that took 
place over the last 7 years because we saw this challenge.
  Mr. Chairman, I have a letter from David Walker, Comptroller General 
of the United States, dated March 13, 2008, which I would enter into 
the Record.

                                                   U.S. Government


                                        Accountability Office,

                                   Washington, DC, March 13, 2008.
     Hon. John Culberson,
     House of Representatives.
       Dear Mr. Culberson: Per our conversation, this letter 
     discusses our nation's deteriorating financial condition and 
     the need for timely action to turn things around.
       Our real fiscal problem is not our current deficit and debt 
     levels but where we are headed absent meaningful reforms. 
     Given the retirement of the baby boomers and soaring health 
     care costs, government outlays are set to rise dramatically. 
     The federal government's liabilities and current unfunded 
     commitments for future spending on Social Security and 
     Medicare are now estimated at $53 trillion and are growing by 
     $2 to $3 trillion a year. This effectively translates into an 
     IOU of around $455,000 per American household. Clearly, our 
     government has already made a range of promises that it is 
     unlikely to be able to keep.
       Because the personal savings rate in this country is so 
     low, we have been turning to overseas investors to finance 
     our nation's debt. Foreign investors, particularly foreign 
     governments, have greatly increased their holdings of U.S. 
     Treasury securities, and some of these government lenders 
     may, either today or over time, have political and economic 
     interests that diverge from our own. The risk is that some of 
     them may

[[Page 3897]]

     eventually use their U.S. financial holdings as leverage 
     against us.
       If we continue as we have, policymakers will eventually 
     have two options: slash government programs and services that 
     the American people depend upon or raise taxes to levels that 
     would seriously harm America's economic growth and 
     competitiveness. In my view, we probably have at most a 5- to 
     l0-year window of opportunity to act. Inaction comes with a 
     steep price tag. Recent projections from Moody's and an 
     analyst at Standard & Poor's suggest that, absent policy 
     changes, our nation is heading toward ``junk bond'' status as 
     early as 2020. By 2030, without reforms to entitlement 
     programs and spending or tax policies, income tax rates would 
     have to more than double to prevent a continued erosion of 
     our financial position.
       Fortunately, by facing facts and making meaningful changes 
     to the budgetary process, entitlement programs, other 
     spending, and tax policies, we can avoid this fiscal train 
     wreck and ensure that America's future is better than its 
     past. Our fiscal clock is ticking, however, and the time for 
     action is now.
       I appreciate the opportunity to express my thoughts on this 
     important subject.
           Sincerely yours,
                                                  David M. Walker,
                         Comptroller General of the United States.

  David Walker wrote me a letter explaining in a one-pager the 
financial challenge facing America. David Walker points out that 
America's real financial challenge is not our current deficit and debt 
levels, but where we are headed without meaningful reform.
  Given the retirement of the baby boomers and soaring health care 
costs, David Walker has certified that the Federal Government's 
liabilities, the current financial obligations that all of us must pay, 
are so massive that we are now in a $53-trillion hole, America. That 
means every household needs to write a check today to pay this off. 
Every household would have to write a $455,000 check to pay off that 
financial obligation, $175,000 a head.
  Every American would have to write a check today for $175,000 to pay 
off this liability. It's unsupportable, it's inexcusable. We have got 
to deal with it because David Walker also points out that we have about 
5 to 10 years to deal with it.
  Now that's critically important information. Everyone says this 
election is the most important in our lifetime. We can say that truly 
this year. We know we will need a conservative anchor in Congress here 
to restrain spending. We need to get these entitlement programs, 
Federal spending under control, which David Walker estimates is 5 to 10 
years, a window of opportunity to act, or he points out that Moody's 
and Standard & Poor's have already warned the U.S. Treasury that by the 
year 2020, U.S. Treasury bonds will be rated as junk bonds.
  Let me reiterate that, folks. If we don't get our financial house in 
order, the Comptroller of the United States has already pointed out 
that Moody's and Standard & Poor's have already warned us that our 
Nation is heading toward junk bond status for Treasury bills.
  It's outrageous. It's unacceptable. We need to reject this budget. We 
need to stop spending money and stop raising taxes on Americans by 
rejecting this irresponsible Democrat budget.
  Mr. RYAN of Wisconsin. Mr. Chairman, let me inquire as to how much 
time is remaining for each side.
  The Acting CHAIRMAN. The gentleman from Wisconsin has 16 minutes 
remaining. The gentleman from South Carolina has 17 minutes remaining.
  Mr. SPRATT. Mr. Chairman, I have sat here all afternoon, and last 
week through the markup, listening to this mantra about tax increases, 
all of which is a fabricated argument, and could not and cannot avoid 
the conclusion that to some extent this is a red herring.
  It's a way of distracting attention from the real problems at hand, a 
way of avoiding discussion of a $236-billion surplus, which is where 
our economy and our budget stood in the year 2000, the year before Mr. 
Bush came to office, the $4 trillion in debt added by the Bush 
administration over the last 7 years, over median family income which 
has fallen under the Bush administration, avoiding discussion about a 
debt-burdened economy, which is losing steam near a recession and a 
dollar, a mighty dollar, which is plummeting, avoiding all of that so 
that we can talk about something that is not going to happen.
  First of all, we made it as clear as we possibly could that we have 
endorsed, embraced and pledged to see continued the middle-income tax 
cuts which are included in the 2001-2003 tax cuts. They add up for the 
renewal over a 5-year period of time to $230 billion. If we follow our 
budget resolutions we have laid out, we will have a surplus in 2012 of 
$178 billion.
  By 2018 the cumulative surfaces will be at $1.4 trillion. If we 
choose then, and we are not making the decision now, but if we choose 
then that will offset the extension of most of the taxes, most of the 
tax cuts that were adopted in 2001 and 2003.
  We have put that in black and white, title V policy, policy on middle 
income tax relief, and we have laid out from item A through item H the 
different tax cuts that we support and are pledged or seeing renewed 
and extended. We can't make it any clearer than this.
  Let me say something else for anybody listening wondering whether or 
not his taxes are about to shoot up and whether he should go cash in 
some stocks and bonds and get ready for this huge tax increase, it's 
not coming. Even if we adopted something that called for it to happen, 
it would have to go through Ways and Means. It would have to go through 
Senate Finance. It's a long way from ever being passed.
  We simply say in our budget resolution, as we get ready for 2010, 
let's see if we can't have a conservative budget that will move us 
toward surplus so that some of that surplus, at least, can be used to 
offset some of these tax cuts. Let's see if we can't put some money 
into program integrity with the Internal Revenue Service and shrink the 
tax gap so we can use some of the money there, raise tax revenues 
without raising tax rates, use some of the money thus gained to offset 
some of these tax cuts when they come up for renewal.
  Go through the code as we did in 1986, give it a good closet 
cleaning. It needs a scrub down as an accretion of the deductions and 
credits and exemptions and preferences, all of these things. If we 
muster our efforts, if we marshal our efforts, we can do and lay the 
basis for the renewal of many of these tax cuts in 2010.
  But we primarily delayed the decision about those tax cuts in 2010 on 
the basis that we need to know more. What will be the state of the 
economy? Will we still be in two different theaters, Afghanistan and 
Iraq, fighting a war that is costing $12 billion a month? Will we still 
have an enormous deficit or will we be in surplus?
  Better that we determine it than guess at it now. We are simply 
saying we would lay the basis. First of all, we would lay down the 
principle that we would protect these middle income tax cuts. Second, 
we will put the budget in place to begin generating surpluses so that 
they can afford the renewal of some of these tax cuts.
  That can be done in this budget resolution. We are not pushing the 
biggest tax increase in American history. I don't know even where the 
numbers arrived from in the first place. I don't think it's 
supportable, but it is totally fantastic. It's an argument that is a 
complete red herring and a complete deviation from what we are all 
about today.
  We should be talking about the savings rate in this country, about 
what deficits are doing to our economy, our country, and our standing 
in the world. There is plenty to talk about that is relevant. This 
subject is not because it's not about something that is about to 
happen.
  Mr. Chairman, I now yield 3\1/2\ minutes to the gentleman from 
Vermont (Mr. Welch).
  Mr. WELCH of Vermont. Mr. Chairman, I believe you spoke for all of us 
on our side in putting in context the basis of this budget and the 
arguments of our friends on the other side.
  I want to just add a few things about what this budget really is 
ultimately about. It's about real people, with real lives and real 
challenges, and the fundamental responsibilities of a governing body 
are to meet a budget and present a budget that meets the needs

[[Page 3898]]

of its people. I want to tell a couple of stories about folks from 
Vermont.
  Scott West, a veteran, of the National Guard, he lives in the town of 
Albany, in the Northeast Kingdom of Vermont. He used to drive a truck 
for a living before he went to Iraq. While he was deployed over in 
Kuwait in support of Operation Iraqi Freedom he suffered very serious 
injuries to his shoulder, back and wrist.
  In May the pain from his injuries got so bad he was no longer able to 
do his job as a truck driver. Nearly 9 months ago, Mr. West filed a 
claim for increased disability compensation from the VA. As of today, 
he has yet to have a hearing.
  Now, the budget that we presented last year and passed, because you 
had foresight, has finally put in place new people to adjust these 
claims. We have got 1,800 new claims processors who are now going to 
help ensure that veterans like Scott will receive the support that they 
deserve in a timely manner.
  I thank you for your leadership. That's the meaning of this budget to 
a man from Albany, and it's going to make a real difference to his 
family.
  Peter and Irma McShane, they live in the southern Vermont town of 
Pownal. They are senior citizens. They live on $1,452 a month, so you 
can imagine how hard it is for them to make ends meet. Now it turns out 
that's $22 more than would be available if they were going to be 
eligible for food stamps.
  So they have to scrimp and save every way they can. They get hit with 
this huge fuel bill. We have had a cold winter in Vermont. The budget 
presented by the administration cut low-income heating assistance. The 
budget that the committee is presenting tries to protect that, and it 
is absolutely indispensable to families like Peter and Irma McShane 
that they have the ability to heat their homes and not have to make a 
choice between medication and heat, between food and heat. This budget 
recognizes that.
  I want to also share a letter I received from a couple from Fletcher, 
Vermont, in northern Vermont. Margaret Kinne and her husband. They are 
talking about the rising cost of health care.
  They have worked in a woodworking business for 13 years, often 6 or 7 
days a week. They don't complain about that. They like to work hard. 
But their insurance has gotten increasingly expensive and now their 
deductibles have gone from $5,000 to $10,000 to $25,000. What they 
wrote to me is this, this translates to me to no insurance. The 
administration budget would cause over a half a trillion dollars in 
cuts to Medicare and Medicaid that would increase the cost shift and 
make that unaffordable insurance even more out of reach of this family.
  I thank you, Mr. Chairman, for the tremendous work that you have done 
in putting together a very good budget in very tough times.
  Mr. SPRATT. Mr. Chairman, I yield 2 minutes to the gentleman from 
Washington, Dr. McDermott.
  Mr. McDERMOTT. Mr. Chairman, the President's proposed budget can mean 
only one thing, the lights are on down at the White House but nobody's 
home. He has the House Republicans carrying the water, but their budget 
is his will, make no mistake about it. If the President gets his way, 
lights will go off across America and people will suffer because of the 
President's complete disregard of the state of the economy, the plight 
of the American middle class and the domestic casualty from his 
irresponsible war in Iraq, that is, meeting the critical, unmet social 
needs of this country.
  For instance, the President proposes slashing the Social Services 
Block Grant Program by $500 million this year and eliminating it 
altogether next year. In my home State of Washington, these funds are 
critical for providing child care for vulnerable families, Meals On 
Wheels and services to prevent child abuse.
  But the President is more interested in helping the rich get richer 
and leaving the rest of America down and out. The President is willing 
to feed their greed by starving the U.S. economy and hurting the 
American people.
  The American people deserve a budget that recognizes reality, and 
that's what the Democrats have offered. We provide tax relief to the 
middle class by demanding tax fairness for everyone. We include 
extended unemployment benefits, but I proposed a separate legislation 
this year because the American people expect their government to 
respond when an economic downturn hits and hurts them. They don't want 
any more New Orleans experiences.
  We provide a budget based on reality, meeting the defense needs of 
the Nation, and meeting the unmet social needs of the American people.
  In other words, the lights are on here, and the Democrats are home 
working for the American people.
  The President has offered a budget that shouts it's all about funding 
a hopeless Iraq war while the Democrats have offered a budget that says 
it's about the economy and hope and help for the American people.
  Vote for the American people and vote for the Democratic budget.

                              {time}  1900

  Mr. SPRATT. Mr. Chairman, I yield 3\1/2\ minutes to the gentlewoman 
from Texas (Ms. Jackson-Lee).
  Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the gentleman from 
South Carolina, and I particularly thank him for his work and for the 
work of the Budget Committee and I look forward to a bipartisan, 
cooperative effort towards the agenda that all of us are committed to, 
and that is a budget that responds to the needs of the American people.
  And so I think it is important to at least address what I think as a 
member of the Homeland Security Committee and the committees dealing 
with our judiciary issues in this Nation and foreign affairs to be able 
to at least assess what I think the Budget Committee attempted to do, 
and that is to cure the ills here in America.
  One of the ills is to highlight where we are today with this number 
one issue that I hear about in my district in Houston and all over 
America which is the loss of jobs. And 63,000 jobs were lost last 
month. When we look at the analysis, we can see that, unfortunately, 
the present administration is number two in the infusion into the job 
market. And that is the testimony that Americans will make about when 
they think the economy is churning. This administration falls as number 
two in the lack of job creation. So this budget attempts to be a job 
creator, and I think it does it very well. How does it do that? It does 
it by giving relief to the middle class, so even as they are struggling 
with loss of jobs, we are recognizing there is a value to giving tax 
relief.
  So someone got up on the floor and talked about we are, in essence, 
spending dollars. I must say that I hope we can find a way to bring our 
troops home. That is $120 billion. But this budget is the kind of tax 
cut that I want to endorse. It is, of course, AMT relief. Let me find 
out my friends on the other side of the aisle that want to get rid of 
the alternative minimum tax relief that is given and don't want to give 
it to those middle class, hardworking Americans.
  An extension of the child tax credit which benefits, again, working 
Americans. The marriage penalty relief, 10 percent bracket, estate tax 
relief, research and experimentation tax credit. I believe that today 
Bill Gates was indicating how many jobs are generated as we promote R&D 
research.
  Deduction for State and local sales tax. States like the State of 
Texas, how many of you want to reject that kind of relief for 
hardworking Texans and others who have State and local sales tax and 
cannot get deductions? This is what the Democratic budget stands for.
  Small business expensing. I consider small businesses the backbone of 
America. They create jobs. They created jobs in Houston. They created 
jobs in Jackson, Mississippi. They created jobs in Utah and South 
Carolina and New York and California. That is the crux of what this 
budget stands for.
  At the same time, of course, let me suggest to my colleagues that it 
does not ignore the relief that we need in education and 
infrastructure. It invests

[[Page 3899]]

in highways, water, and other infrastructure. It protects concerns that 
I have like NASA and the Children's Health Insurance Program and like 
the relief for education and many of the programs that provide relief 
for poor and minority children.
  Let me conclude by saying this is the kind of budget that I want to 
affirm, a working America budget, a middle class budget. This is a good 
budget. I know we can do this in a bipartisan way. Support this budget 
and support America.
  Mr. Chairman, I rise today in support of H. Con. Res. 312, the 
Concurrent Resolution on the Budget for FY 2009, introduced by my 
distinguished colleague from South Carolina, Chairman Spratt.
  I wish to thank our great Speaker, Ms. Pelosi, for never letting us 
forget that we are here for one reason only, and that is to address the 
real needs and priorities of Americans.
  Finally, let me thank the remarkable leadership team which has worked 
long, hard, and tireless to keep us informed, cooperative, and united 
in our resolve to do the necessary work to make America better.
  Our Republican colleagues ask if we can afford the Democratic budget 
. . . and I ask--How we can afford to continue to cheat the American 
people? What we can not afford is to continue with the Bush 
Administration's fiscal irresponsibility which has led us to almost 
$9.6 trillion dollar deficit. What we can not afford is to hear 
rhetoric from the other side of the aisle about balancing the debt and 
curbing taxes while the administration they support continues to dig 
deeper and deeper into the deficit. Let's not ask how we can afford to 
support the Democratic budget, let's ask how we can not afford to 
support it.


                               Education

  A quality education continues to be the best pathway to social and 
economic mobility in this country. As a Member and Senior Whip of the 
Congressional Black Caucus, I have consistently advocated for the 
maintenance of Historically Black Colleges and Universities. This 
budget provides greater funding to our nation's schools and colleges. 
The increased spending can and should be used for several purposes, 
including Head Start, Title I Compensatory Education program, and job 
training and national service programs. It could also be used to 
increase the Federal share of the cost for educating handicapped 
children, and to help improve access to colleges, and broadening access 
to Hispanic Serving and Historically Black Colleges and Universities.


                                 SCHIP

  We must not only be economically healthy, but assist in the physical 
health of our citizens. This budget will properly fund SCHIP, to help 
one of our most vulnerable populations--children. Our President 
proclaims his support for securing our nation's current and future 
economic success. However, it is our children that will bring forth a 
successful future. We need to invest in tomorrow by investing in them 
today. This starts with their physical well-being. Children, who cannot 
see the doctor when they are sick, will not be in anyone's classroom.


            African-Americans--Health and Education in Texas

  For African Americans, health and education concerns spill beyond 
budgetary issues into the criminal justice consequences. In Texas, over 
87,000 African-Americans are incarcerated compared to approximately 
48,000 African-Americans attending college or university.
  The disparity between the percentages of our youth in prison versus 
the number of young people in college, particularly in the African-
American community, is disturbing to say the least. Higher education 
continues to be one of the main pathways to social and economic 
mobility, particularly in the African-American and Hispanic 
communities.


                     Republican Budget Alternative

  Under the Republican Budget the national debt continues to explode. 
The gross federal debt reached $9.0 trillion at the end of 2007. The 
CBO projects that the debt will rise by a total of $3.9 trillion at the 
end of 2008. This unprecedented rise in debt puts our President in the 
history books. During the seven years of the current Administration, 
the government has posted the highest deficits in this nation's 
history. The President's 2009 Budget continues the failed policies that 
brought us to this point.
  Our colleagues on the other side of the aisle continue to claim that 
the budget resolution being considered on the floor this week raises 
taxes. In fact, the budget resolution does not raise taxes by one 
penny. The budget resolution accommodates tax cuts and indeed 
prioritizes tax cuts that would benefit middle-income families, while 
ensuring that the burden of paying for the tax cuts will not fall 
undeservedly on our future generations.


                              Foreign Debt

  The amount of foreign debt has doubled since 2001, with most of this 
increased debt purchased by foreign lenders. Since 2001, the increases 
in foreign holdings of Treasury securities account for over 80 percent 
of the newly accumulated public debt--a trend that has more than 
doubled foreign holding of Treasury securities.
  This high level of indebtedness to foreign investors heightens the 
economy's exposure to potential instability with additional burdens on 
our children and grandchildren.


                        Section 501--Statistics

  Section 501 of the budget resolution specifically calls for 
additional middle-income tax relief subject to the pay-as-you-go rule, 
including but not limited to: AMT relief (both immediate/temporary, and 
more permanent reform measures); Extension of ``middle-class'' elements 
of 2001 tax cuts: child tax credit, marriage penalty relief, and 10 
percent bracket; Eliminating the estate tax on all but a minute 
fraction of estates; Extension of the research and experimentation tax 
credit; Extension of the deduction for State and local taxes; Extension 
of small business expensing; Enactment of a tax credit for school 
construction bonds; and tax incentives for energy efficiency and 
renewable energy which are accommodated in a separate deficit-neutral 
reserve fund.
  The budget resolution honors PAYGO and the new House rules on using 
reconciliation in a fiscally responsible way. By abiding by the pay as 
you go principle, we immediately begin digging our way out of the 
mountains of debt that has accumulated as a result of the Bush 
Administration's fiscal policies.


                         Republicans and Taxes

  The President's budget and the Republican alternatives violate pay-go 
and the fiscal responsibility that reconciliation is intended to 
achieve, by proposing tax cuts that are not offset.
  The sunsets for the 2001 and 2003 tax cuts were part of the tax 
legislation which Republicans voted for and passed. The expiration of 
the tax cuts is their policy. The Democratic budget actually calls for 
the extension of many of these tax cuts, but responsibly requires that 
tax cut extensions, like other policies, must be fiscally sound, and 
not make the deficit worse.


     Support for the Democratic Budget based on the American Values

  This important piece of legislation gives us a budget that is 
balanced fiscally and morally. It does not sacrifice the many programs 
and services that this nation needs for a War that the President seems 
never to end.
  Mr. Chairman, this budget better reflects the priorities and values 
of the American people. After all, a budget is much more than a balance 
sheet, an income statement, a financial scorecard. Rather, it the 
expression in fiscal terms of who we are and what we believe. In short, 
a budget is a financial reflection of our national character. And as it 
is by a person's character that you know her, so too it is with a 
nation.
  Look at a nation's budget and you will see how it treats its children 
in the dawn of life; its elderly in the twilight of life; its poor and 
disabled and helpless in the shadows of life; and the earth, the 
sustainer of life. Look closely at the choices it makes regarding the 
neediest and most vulnerable of its people, and you will know the true 
character of a nation.
  Mr. Chairman, America and the world can be proud of the choices we 
make in this budget resolution. Unlike the budgets of the last seven 
years, the budget brought to the floor by the new House majority 
reflects the best angels of our nature. This budget expands health care 
for our children. It provides our soldiers and veterans with the care 
worthy of their sacrifice; it is faithful to President Lincoln's 
injunction ``to care for him who has borne the battle and for his widow 
and his orphan.''
  This budget resolution supports education for a 21st century 
workforce and a growing economy. It invests in renewable energy for an 
energy independent America that faces up to the challenge of global 
warming.
  Equally important, Mr. Chairman, the majority's budget resolution 
represents a return to fiscal responsibility and budgetary 
accountability. I am proud to support a budget that reflects the care 
and fidelity of a wise steward of the taxpayers' hard-earned money. The 
American people can be assured that the new majority in Congress will 
not be profligate with the public treasury.
  Mr. Chairman, this budget resolution correctly assumes that 
substantial savings can be realized from more vigorous efforts by 
Defense Department (with increased Congressional oversight) to root out 
fraud, abuse, and wasteful spending. It is totally unacceptable that 
unlike the typical taxpayer, small business, or large corporation, the 
Defense Department still cannot pass a standard audit.

[[Page 3900]]

The Pentagon cannot adequately track what it owns or spends. We just 
know that it's a lot.
  Mr. Chairman, the new House majority pledged that we would work 
together to restore our economic health, reclaim our leadership 
position in the world, advance our national security, and invest in the 
future. We promised to restore fiscal responsibility and began by 
instituting tough pay-as-you-go rules. And we have been delivering.
  For example, in the first 100 hours of the 110th Congress, we passed 
with bipartisan support procedures imposing discipline and transparency 
in congressional spending. With bipartisan support, we also passed 
legislation to implement recommendations of the 9/11 Commission, 
increased the minimum wage, paved the way for lower prescription drug 
costs, cut student loan costs, and redirected oil subsidies towards 
investments in renewable energy. We did all of this while maintaining 
our commitment to fiscal discipline.
  The 2009 budget resolution advances these priorities. It begins to 
reverse seven years of disinvestment in education, infrastructure, and 
innovation. The budget resolution is the crucial next step to realizing 
the initiatives we have developed to move the country forward and to 
set us on a course to build the future we want for our children and 
grandchildren.
  Mr. Chairman, we reject the President's proposed cuts to education 
programs, including rejection of his proposals to eliminate many 
education programs. We also reject the president's proposed steep cuts 
in job training and social service programs, including the Community 
Services Block Grant and the Social Services Block Grant.


                   community and regional development

  The community and regional development function includes programs 
that provide Federal funding for economic and community development in 
both urban and rural areas, including Community Development Block 
Grants, CDBG, and the non-power-related activities of the Tennessee 
Valley Authority, TVA.


                         International Affairs

  The international affairs function includes international development 
and humanitarian assistance, international security assistance, the 
conduct of foreign affairs, foreign information and exchange 
activities, and international financial programs.


                               CONCLUSION

  Mr. Chairman, correcting the fiscal course of the country cannot be 
achieved overnight. The fiscal outlook we are confronting has 
deteriorated dramatically over the past seven years. In 2001, the 
Administration inherited a projected ten-year, 2002-2011, budget 
surplus of $5.6 trillion. Within two years, that surplus was gone and 
the United States began accumulating a mountain of national debt. Most 
of this debt has been purchased by foreign investors, making the U.S. 
economy more susceptible to economic and political pressure from 
abroad.
  Mr. Chairman, we have a responsibility to clean up the fiscal mess 
that we have inherited. The choice to live beyond our means comes at 
the expense of future generations, who will bear the weight of the 
fiscal irresponsibility of our current administration.
  Large deficits also hurt economic growth by depressing national 
saving, generating less capital for investment for the future. This 
leads to lower productivity and wages.
  The President's budget continues the fiscal approach that has brought 
us large deficits and growing debt. In comparison, our budget 
resolution takes the necessary steps toward eliminating our long-term 
budget deficit by adhering to the pay-as-you-go principle.
  But a balanced budget must be accompanied by balanced priorities. 
While regaining control over our economic future is critical, we must 
do so within the context of honoring our obligations. This budget is a 
critical first step toward fulfilling our commitments to the American 
people. We will balance the budget. We will be fiscally responsible. We 
will defend our country. We will put children and families first. We 
will grow the economy. We will cherish and protect our environment. We 
will conduct the Nation's affairs in an accountable and efficient 
manner.
  Mr. Chairman, the people have asked for change. They have asked for 
greater accountability, they have asked for a balance of defense and 
sustaining programs. The American people entrusted us with the 
responsibility of leading our country in a new direction. The part we 
have charted in this budget resolution will lead to a brighter future 
for children and better America for generations to come. It reflects 
very well on our national character. For all these reasons, I stand in 
strong support of H. Con. Res. 312. I urge all members to support the 
resolution.
  Mr. SPRATT. Mr. Chairman, I reserve the balance of my time to close.
  Mr. RYAN of Wisconsin. Mr. Chairman, I yield 5 minutes to the 
gentleman from Texas (Mr. Hensarling), a senior member of the Budget 
Committee.
  Mr. HENSARLING. Mr. Chairman, I thank the ranking member for yielding 
to me. I have listened with great interest as my friends from the other 
side of the aisle, the Democrats, attempted to do everything they could 
to distance themselves from their single largest tax increase in 
American history contained in their budget.
  Again, Mr. Chairman, here are $683 billion worth of tax increases. 
This is what we call the CBO baseline, the Congressional Budget Office, 
which assumes that, as current law says, we are going to have huge 
automatic tax increases, most of which kick in in 2011. That is this 
red line.
  Well, our friends on the other side of the aisle claim they are 
balancing the budget in 2012, but they can only do it through these 
huge, automatic tax increases. And this isn't my baseline. They 
appointed the Director of the Congressional Budget Office, so if they 
have some problem with this particular revenue curve, they need to take 
it up with him. You can't have it both ways. You can't claim you are 
not increasing taxes and at the same time claim, claim that you are 
balancing the budget in 2012.
  Now, I listened very carefully when my distinguished chairman said 
that he wants to prevent these tax increases. I know he wants to 
prevent it. And I listened to the gentlelady from Texas saying that she 
endorses middle income tax relief. But they just don't seem willing to 
vote that way, Mr. Chairman.
  If I did the math correctly, there have been at least 21 occasions 
over the last 6 years when Democrats could have voted to prevent these 
huge, automatic tax increases, which will amount to an average tax 
increase on the American family of $3,000 a year. So the rhetoric is 
nice. The language is comforting. But when will somebody on that side 
of the aisle put their vote where their rhetoric is? I don't see it, 
Mr. Chairman. It reminds me of the old adage that your actions are so 
loud I can hardly hear your words.
  Now I hear a lot of talk on the other side of the aisle about how 
compassionate their budget is and somehow our budget is not 
compassionate. I'm not sure what is really compassionate about raising 
taxes on hardworking American families because, Mr. Chairman, every 
time you plus-up the Federal budget, guess what, it comes out of some 
family budget. And I hear from those families. I hear from the families 
in the Fifth Congressional District of Texas that I have the honor of 
representing.
  I heard from the White family of Mesquite, Texas: ``Regarding the 
news that the average Texas family may soon be burdened with extra 
taxes, it is not good news to a family with $24,000 a year in income 
and two expensive stroke-prevention medications, among other critical 
medications to maintain.'' Their $3,000 a year tax increase, the 
largest tax increase in American history, is going to decimate the 
family health care budget.
  Now, I heard from the Sessions family in Quitman, Texas, also in my 
district: ``Any increase in income taxes would cut into my Social 
Security money so much, to such an extent I would not be able to 
purchase my medications.'' Again, their single largest tax increase in 
American history is going to decimate the family health care budget.
  Mr. Chairman, I heard from the Swanson family from Wills Point, 
Texas: ``A tax increase of that size will prevent me from receiving the 
medications necessary to prolong my life.''
  Once again, the single largest tax increase in American history are 
decimating, will decimate families, not just in the Fifth Congressional 
District of Texas, but all over America. I wish that my friends on the 
other side of the aisle would just take a moment and think about who 
has to pay all of these taxes while Americans are struggling to pay for 
their health care bills and to make sure that they keep a roof over 
their head, to send their children to college, to fill up their cars 
and pickup trucks, to try to start small businesses.

[[Page 3901]]

How are they going to be able to afford the single largest tax increase 
in history? Where is the compassion in taking money away from these 
hardworking families?
  What does it do to their housing? Well, I heard from the Stevens 
family in Mesquite, Texas: ``I wanted to let you know that I am a 
single mom that does not receive any type of child support, and an 
increase of this amount would break me. I would be at risk of losing my 
home with this type of increase.''
  The single largest tax increase in American history, an average of 
$3,000 per American family, most of it due to hit right there, 2011, 
coming very soon to a neighborhood near you. It is going to decimate 
the housing budget. It is going to decimate the health care budget. It 
is going to decimate the education budget of hardworking American 
families all across the Nation.
  Where is the compassion there? There is no compassion there.
  Mr. RYAN of Wisconsin. Mr. Chairman, I yield myself the balance of my 
time to close.
  Mr. Chairman, I first want to start off by congratulating the 
chairman of the Budget Committee, a good man, a man I have a lot of 
respect for who has a hardworking staff and a diligent staff. I want to 
compliment them. These budget resolutions are not easy to write.
  He has a tough job because he has to defend this budget. This is a 
budget I wouldn't want to come to the floor to defend. I just have to 
bring one point to bear, and I do so respectfully. You cannot say that 
you are balancing the budget and not raising taxes. It is illogical and 
axiomatically impossible. Let me explain why.
  This red line is the baseline that the Democrats are using for their 
budget. It is what we also refer to as the CBO baseline. This green 
line is the baseline minus the tax increases. They are using the red 
line, not the green line. This means in order for them to achieve a 
balanced budget, what must happen, what is required to happen, what has 
to happen, all of these taxes have to be raised, specifically by $683 
billion over the next 5 years.
  Now, my friend from New Jersey, another very conscientious, skillful 
Member, said that was a tax vote he regretted not taking. And the 
Senator from New York at that time, Senator Moynihan, said that was the 
largest tax increase in American history. That was $240 billion. This 
one is $683 billion. This is the largest tax increase in American 
history.
  The point is this: You cannot claim you are balancing the budget and 
not raising taxes because you are relying on these very tax increases 
to balance the budget. That is what this budget does. Now, no amount of 
reserve funds, no amount of senses of Congress, no amounts of ``we have 
delayed the decision on the tax cuts for now'' gets them out of this 
bind. They can't. It is impossible. You have to have it one way or the 
other. Either you are not balancing the budget or you are not raising 
these taxes because, Mr. Chairman, they are not saving any money. There 
is no savings in this budget.
  The piece of paper I have in my hand is more valuable than the amount 
of savings they have in this budget. This paper, may it cost 1, 2 
pennies. That is more money than they are saving in this budget over 
the next 5 years. In fact, they are expanding spending. They are 
increasing discretionary spending by $280 billion. What is worse is 
they are going to add, in just two programs, an unfunded liability of 
$14 trillion, to just two programs, Medicare and Social Security.
  Let's look at the Medicare program. Today, the Medicare unfunded 
liability, according to David Walker, our GAO Comptroller General, is 
at $34 trillion. That is an average per household bill of $300,050. 
Every household in America right now, if we want to make Medicare whole 
for my children when they need it, 300 grand.
  Under this budget, because they do nothing, they are adding $11 
trillion to that liability. That is $395,650, almost $400,000 for one 
household to cover Medicare so my children can maybe get it. That's for 
our kids. That is wrong.

                              {time}  1915

  We have got to address these issues.
  Now, Mr. Chairman, surely, there's waste in government. Surely, 
there's efficiencies we can get. But this budget concludes that there 
is not. This budget is basically saying, Washington's not wasting any 
money. All of these earmarks, the 11,000 we passed last year, are 
perfect, they're justified; we should do 11,000 more. And there's no 
waste, fraud or abuse anywhere in the Federal Government. In fact, 
they're doing such a good job in Washington spending our tax dollars, 
let's give them $280 billion more to spend. And on top of it, given the 
fact that our entitlements are going bankrupt, given the fact that we 
have an unsustainable course, let's just add more to the debt; and 
we're going to raise taxes while we do it. But we won't tell people. 
We'll pass this kind of cute reserve fund, sense of the Congress that 
says we really don't want to raise those taxes, but we're balancing the 
budget. That means you're raising taxes if you're going to balance the 
budget.
  But let's look at the brass tacks. And this is what I want to ask the 
American people. Can you afford this budget?
  People are struggling right now. People are losing jobs. We just 
finished 52 consecutive months of positive job growth, very impressive 
growth. Finished, I said. The last couple of months they've been bad 
months.
  Also, prices; the cost of living is going up to America, the cost of 
health insurance, the cost of food, the cost of filling your gas tank 
when you take your kids to school, the cost of sending your kids to 
college. The cost of living is higher and higher, and people's pay 
checks are not getting as far along as they used to.
  And so what does this budget do? It raises their taxes. It says 
you're going to have to send, on average, three more grand per person 
to Washington because we don't think Washington has enough of your 
money. We think Washington's great. There's no waste, there's no 
inefficiency, no fraud. We, in fact, need more of your taxpayer 
dollars, you, American men and women of America.
  So I'd like to know, is that what America wants? Tell us. Call us, e-
mail us. Call your Congressman. Because here's what this bill will do 
specifically. 116 million taxpayers will see their taxes on average go 
up $1,800; 84 million women will sustain, on average, a tax increase of 
$2,121; 48 million married couples will incur an average tax increase 
of over $3,000. Taxes will increase by an average of $2,323 for 43 
million families with children. Some 12 million single women with 
children will see their taxes increase on average by $1,091. For 18 
million elderly individuals taxes will increase by an average of 
$2,181. Tax bills for 27 million small business owners will rise on 
average by more than $4,000. And more than 6 million taxpayers who 
previously owed no taxes at all will become subject to the individual 
income tax as consequence of these tax increases.
  Mr. Chairman, we had an opportunity here. We had an opportunity to do 
something that I felt would be good and bipartisan. I've heard my 
colleagues on the other side talk about the need to do this.
  We had all these witnesses come to the Budget Committee, saying we've 
got to get our fiscal house in order, that we owe the next generation a 
debt-free Nation, that we owe them the mission of health and retirement 
being fulfilled, which means reforming our entitlement programs.
  This budget says for the next 5 years, let's not do any of it. Let's 
make sure that we're on the glide path so that our kids will pay 
literally twice what we pay today in taxes, just for our Federal 
Government today to be there for them when they're our age.
  This is a lost opportunity. Under this budget, the unfunded 
obligation that are Medicare and Social Security themselves go up 37 
percent, $14 trillion. I'm upset at the debt that was racked up lately, 
but it pales in comparison to the debt that this budget proposes to 
rack up.
  So what we really ought to be doing, Mr. Chairman, is we ought to be 
fixing this budget process, having real budget

[[Page 3902]]

discipline, real spending caps. We ought to be making reform decisions. 
And the last thing we ought to be doing in this time of high prices, a 
tough standard of living to maintain, in this time of economic downturn 
which quite possibly could come into recession, the last thing we ought 
to be doing is raising taxes. That is what this budget does.
  We will propose a different alternative tomorrow. We will propose a 
budget that balances the budget without raising taxes by controlling 
spending. And even in doing that, spending will still go up one year 
after the other. Instead of spending $15.8 trillion over the next 5 
years, we're going to propose to spend $15.3 trillion. And by simply 
doing that, by simply exerting a little bit of discipline, we're going 
to make sure that we're not raising these taxes, and we're going to 
repeal the alternative minimum tax.
  One more thing, Mr. Chairman. This earmark problem is getting out of 
control. Earmarks are an abuse. Some are worthy, some are right, but a 
lot of them aren't. We've got to control this. We are proposing a real 
earmark moratorium.
  More importantly, we are saying let's take a timeout from earmarks 
and let's save that money. Our proposal tomorrow will not only have an 
earmark moratorium, it will save the money from an earmark moratorium. 
And if Congress just says no to earmarks for 1 year, you know what we 
can do? We can make permanent the child tax credit and the repeal of 
the marriage tax penalty. We can say, pass up your earmarks for a year 
in Congress and don't tax people for getting married. Pass up your 
earmarks for a year in Congress and don't cut the child tax credit in 
half.
  These are the choices we are being confronted with. These are the 
choices that we must make. These are the values that we believe. We 
believe we owe our children a growing economy, a future of a higher 
prosperity, of a higher standard of living, and one in which the 
promise of health and retirement security is actually sustainable, is 
actually made good upon.
  That's not what this budget does. There's no way you can split these 
hairs with the reserve funds, senses of Congress, flowery Washington 
rhetoric. This budget contains the largest tax increase in American 
history, not just on wealthy people, on all people. That's wrong. It's 
not right. We shouldn't do it because Washington doesn't have a tax 
revenue problem, Washington has a spending problem. Unfortunately, the 
Democrat budget makes it worse by spending even more money.
  There is waste in Washington. There is waste in earmarks. There are 
entitlements that are out of control. We should confront those, instead 
of just throwing more money at Washington, because you know where that 
money comes from? It comes from the hard working men and women of 
America. It comes from families, it comes from entrepreneurs, it comes 
from small businesses, it comes from the individual of this country. 
That's wrong. They should be able to keep more of their own money and 
we should be able to clean up government.
  I urge a ``no'' vote on this budget.
  Mr. Chairman, I yield back the balance of my time.
  Mr. SPRATT. Mr. Chairman, I can return all the compliments that Mr. 
Ryan paid to me. He's a pleasure to work with, and I have great respect 
for him.
  But there's one thing he didn't mention at all in his presentation 
all afternoon and that is his budget substitute. And I think one of the 
reasons he didn't do it is that it won't bear scrutiny.
  If you look at the Ryan substitute, the Republican minority 
substitute, you'll find, if you look very closely and know where to 
look, something called function 920. Now, function 920 is the catch-
all. When you can't assign some expenditure or revenue raiser somewhere 
else, you put it in function 920. It means really we haven't yet 
completed the job.
  When you look at 920 in this case, the minority has assigned $817 
billion in undefined savings or at least $405 billion in discretionary 
spending cuts which are undistributed. They haven't been assigned to 
the Veterans Administration or to the Defense Department or to the 
Transportation Department. They are undistributed cuts, $405 billion. 
I've never seen in all my years in the Budget Committee, anything that 
has a function 920, this catch-all in cuts of $405 billion.
  But in addition to that, it calls for $412 billion in mandatory 
savings. Now, we don't know for sure where mandatory savings are coming 
from, which programs are in jeopardy. But when Ways and Means is 
directed to reconcile $253 billion over 5 years, the Energy and 
Commerce Committee is directed to reconcile $116 billion over 5 years, 
we know the resolution has Medicare and Medicaid in its bore sights and 
the likely cuts are substantial. $368 billion. We've never done 
anything that approaches that magnitude at Medicaid and Medicare cost 
reduction. Indeed, during the Gingrich era, Republicans were pushing 
something of that size. It never got off the ground, and it wouldn't 
here either, let me tell you. So that's unrealistic. And the 405 is 
unrealistic because the work hasn't been done.
  And then finally Mr. Ryan calls for, in his resolution, $1.2 trillion 
in tax cuts over the next 5 years. If you extend these tax cuts out, 
and you consider what he's doing, he wants to extend all the expiring 
tax cuts and, on top of that, also repeal the alternative minimum tax, 
just repeal it. The likely impact on revenues is about $2.5 trillion 
over 10 years, which blows a big hole in the bottom of the budget. And 
I don't think that's realistic either. It certainly isn't realistic if 
we're in earnest about seeking a budget that will balance. And so here, 
buried in the budget resolution, which he's not mentioned all 
afternoon, are three major problems with his budget resolution. He 
hasn't done his work. He hasn't distributed the cuts. And I'll tell you 
what that does. When you have $405 billion in function 920 
undistributed, you can say to the veterans who come to you, we've got 
$1 billion covered for you. You can say to others, with plausible 
deniability, oh, you won't be cut, you won't be cut. But in truth, $405 
billion is 20 percent of nondefense discretionary spending. That's 
where the cuts are going to fall every year at 20 percent. I don't 
believe it's going to happen. I don't think therefore that what he's 
presented is a valid, reasonable, defensible alternative to the budget 
resolution, and it strikes me as passing strange that we haven't 
discussed it all afternoon.
  Now one final shot across the bow, one final statement about the 
mantra we've heard all afternoon. We do not propose to implement, in 
this budget resolution, any tax cuts whatsoever. We're laying down the 
policy as clearly as we know how in title V on middle-income tax 
relief, and specifying very clearly and pledging ourselves very, very 
committedly to the enactment, preservation and extension of these tax 
cuts. That's the policy of this budget resolution. Everyone should bear 
it in mind.
  The Acting CHAIRMAN (Mr. Walz of Minnesota). The gentlewoman from New 
York (Mrs. Maloney) and the gentleman from Texas (Mr. Brady) each will 
control 30 minutes on the subject of economic goals and policies.
  The Chair recognizes the gentlewoman from New York.
  Mrs. MALONEY of New York. Mr. Chairman, as Vice Chair of the Joint 
Economic Committee, I am pleased to speak in the time reserved by the 
Budget Act for a discussion of economic goals.
  America has the strongest and wealthiest economy in the world. When 
government makes the right choices, economic growth helps all Americans 
live a better life today and provides a good future for our children 
tomorrow. Unfortunately, the Bush administration has not been making 
responsible choices over the past 7 years. We must chart a more 
sensible course for economic policy than has been pursued by this 
administration. Our Democratic majority has made important progress, 
but there is still much more to do.
  President Bush was once fond of saying that his policies were working 
to

[[Page 3903]]

make the economy strong. But the economy is now teetering on the brink 
of what may be the second recession of the Bush Presidency.
  It is now clear that even the relatively weak economic growth 
experienced earlier in this administration was built on an unstable 
foundation.
  The soaring housing prices that helped fuel our economic recovery now 
appear to have been a classic asset bubble. The collapse of that bubble 
is spreading throughout our entire financial and credit system.
  American families are optimistic, by nature, but they are 
understandably worried about the future. Most American families have 
struggled just to hold their economic ground.
  Under President Bush's management, our economy has set record after 
record, but they have been the wrong kinds of records, historically, 
poor levels of job growth, the greatest gap between the haves and the 
have not since the 1920s, record numbers of uninsured Americans. Over 
47 million Americans lack health insurance.

                              {time}  1930

  A record $9 trillion Federal debt, the largest in our history, and 
the largest single-year deficit in U.S. history. Record oil prices, 
record declines in the value of the dollar, record trade deficits that 
are the largest in history, record declines in housing prices and home 
equity that are leaving families owing more than their homes are worth.
  Bush's job growth record is among the worst of any President since 
Hoover. As this chart shows, since the Great Depression, only his 
father has presided over a slower rate of job growth. As you see, the 
rate of job growth under President Clinton was four times higher than 
President Bush or Bush's father.
  Wage growth has been even slower. Wages are up less than 4 percent in 
real terms since President Bush came into office. This chart shows the 
contrast between sluggish wage growth and soaring prices for such basic 
needs as education, health care, and gasoline. These basic costs of 
living have grown over 10 times faster than wages.
  Look at this chart. The average wages are up 3.8 percent; public 
university tuition, 40 percent. Family health insurance premiums are up 
46 percent, and a gallon of gas is up 87 percent. Middle class workers 
are being left behind because their hard work has not translated into 
bigger paychecks.
  This chart shows the divergence between strong productivity growth, 
shown on the top blue line, and much weaker growth in real compensation 
for ordinary workers, shown in the bottom red line.
  Workers' productivity and their compensation used to grow together, 
but now they grow apart, as this chart shows. This was still true as 
recently as the late 1990s, but it is not true today. So here you see 
that for decades the productivity per hour and real compensation per 
hour basically grew together at the same time, at the same rate. But 
now look at the great difference between the productivity per hour, the 
output per an average worker, and the real compensation that the 
average worker takes home.
  If our increased wealth has not gone to ordinary workers, then where 
has it gone? One answer is that it has gone to a very few at the top of 
our economy. The divide between the haves and the have-nots is reaching 
yet another record, a poor record level. We have the largest gap 
between the haves and the have-nots in many a long time. This chart 
shows that the share of income held by the top 1 percent of taxpayers 
is not at the highest level, 19.4 percent, since the Roaring 20s.
  The compensation growth that the middle class has received came much 
more from benefits than from wages. Benefit costs have been increasing 
because health insurance costs are increasing, are rising up 47 percent 
in inflation-adjusted terms since 2007.
  As this chart shows, rising health costs have driven the number and 
percentage of uninsured Americans to record levels; 47 million 
Americans are uninsured today, up 8.6 million since President Bush took 
office. Yet again another unfortunate record from this administration.
  Slow job growth and stagnant wages during much of the Bush 
administration have depressed families' real incomes. The typical 
American family is earning almost $1,000 less than they did when the 
President took office and after taking inflation into account. As 
families struggle to make ends meet, they borrowed more and more from 
their major source of wealth and savings: the equity in their homes.
  Under the Bush administration, families' equities stake in their 
homes has declined to the lowest level ever recorded. As housing prices 
drop, families will no longer be able to draw on this source of income 
to make up for slow wage and job growth. Yet, the President and his 
supporters react to these disturbing trends by pressing tax cuts that 
largely benefit our most fortunate families.
  This chart shows the distribution of the benefits received from the 
tax cuts. The tall bar on the right shows that households earning $1 
million or more in 2007 income received over 100 times more money in 
these tax cuts than middle income families did. Incredibly, one-fifth 
of tax benefits went to these few families who make up just three-
tenths of 1 percent of taxpayers.
  The Bush administration claimed that these tax cuts would drive 
investment creating growth in wages and employment, but these claims 
have proven to be false.
  To make matters worse, the tax cuts have been funded using borrowed 
money. According to the Brookings Institution, the Federal Government 
has already borrowed some $1.6 trillion to fund the tax cuts.
  When President Bush came into office in 2001, he inherited a 
projected 10-year budget surplus of $5.6 trillion. He inherited a 
government in good financial shape prepared to deal with the budget 
challenges posed by the retirement of the baby boomer generation and 
prepared to invest in improving the future standard of living of all of 
our children and our grandchildren. But this administration has 
presided over a stunning reversal of fortune.
  This year our gross Federal debt will top $9.6 trillion, the largest 
in history, or more. That means that every American owes $30,000 per 
person to pay off this staggering debt. As a share of our economy, 
that's the highest level since 1955 when we were paying off debts from 
World War II. This is the financial mess that we have to clean up.
  Thanks to the President's policies, we are now a nation of debtors 
relying on the rest of the world to finance our budget deficits and the 
cost of the war in Iraq. As former Secretary of the Treasury Larry 
Summers has said: There is something very odd about the world's 
greatest power being the world's greatest debtor.
  Our current account deficit, which is the broadest measure of our 
trade deficit with the rest of the world, rose to yet another record, a 
record smashing $857 billion in 2006. And last year was likely even 
worse. The amount of Federal debt owned by foreigners has more than 
doubled under Bush's watch, rising to nearly $2.4 trillion, with Japan 
and China alone holding more than $1 trillion of our debt.
  How does the administration address our financial problems? They turn 
to cuts and benefits from middle and working-class families. The 
President's proposed some $30 billion in cuts to the Medicaid program. 
That's a program that provides health care for some 27 percent of our 
Nation's children. These cuts couldn't come at a worse time. A recent 
study by the staff of the Joint Economic Committee estimated that 
should the economy enter into even a mild recession, some 1 million 
additional children per year would require Medicaid benefits. So these 
cuts are especially cruel.
  Even while proposing these cuts and benefits, the administration 
wishes to continue massive levels of spending on the misguided 
priorities that landed us in this fiscal mess. The President's budget 
calls for all of the 2001 and 2006 tax cuts to be made permanent. But 
Democrats are not about to mortgage anymore of our children's future 
for all of these irresponsible tax breaks.
  What is more, we have heard no plans for lessening the enormous 
fiscal and

[[Page 3904]]

economic drain created by the mismanaged war in Iraq. This chart shows 
the steady upward march in the administration's requested spending for 
the war. That's over $600 billion just so far, with no end in sight. In 
fact, in this year's 2009 budget, the administration even refuses to 
tell us what the full-year cost for the war might be. Future costs will 
be truly massive if the Nation does not change course.
  The Joint Economic Committee has submitted that over the next decade, 
a continued presence in Iraq will cost us a total of $1.9 trillion in 
Federal spending and $2.8 trillion in total impacts on the economy. You 
can find this report on my Web site.
  But the good news is that we have a choice. We don't have to continue 
spending on the misguided priorities of the last 7 years. If we make 
responsible choices, our government can once again help middle class 
families improve their quality of life while saving and investing to 
improve the lives of future generations.
  Our Democratic Congress has made important progress on this agenda. 
We have worked with the President to increase the minimum wage, expand 
Head Start, assist struggling homeowners, and increase opportunities in 
higher education. We've expanded investments in energy independence, 
green technology, and America's future competitiveness in science and 
technology.
  What is more, we have paid for it all in a fiscally responsible 
manner. We've also worked with the President to pass an economic 
stimulus package that was truly targeted to middle class families who 
needed the assistance most.
  Unfortunately, the President has blocked progress on many other 
initiatives. He has vetoed health insurance for America's uninsured 
kids, a change of course in Iraq he vetoed, and dozens of other bills. 
We must turn away from the failed policies of the past which has given 
us record levels of debt, trade deficit, and deficits of the highest 
records in history and an order to fully deliver on what the economy 
can do for all Americans.
  Mr. Chairman, I reserve my time.
  Mr. BRADY of Texas. Mr. Chairman, as a member of the Joint Economic 
Committee on behalf of our senior ranking Republican, the Honorable Jim 
Saxton, I rise today to oppose the Democrats' irresponsible budget 
resolution that will only pave the way for major tax increases and hurt 
the economy.
  You may recall that 15 months ago, Democrats took over the control of 
the House and the Senate vowing a new direction for America, and in 
truth, we've experienced that. Since Democrats took control of both 
Chambers, food prices are up, college tuition is up, health care costs 
are up, fuel prices are way up, unemployment is up, the deficit is up.
  They vowed that they would do three things: They would pay every dime 
of this war, not mortgage the future. How much have they paid? Zero. 
They vowed they would not raise the debt limit. In fact, they called it 
immoral when we did it. So they did it very quietly without a vote in 
the first 60 days they were in control. And they vowed that they would 
pay as you go, that they would not allow any tax increases or relief to 
go forward without paying for them, and, of course, they failed at that 
as well.
  And now we are at a time when the economy is on the brink of a severe 
downturn. The last thing we should be doing is telling Americans to 
expect to pay billions more in taxes in just 2 short years; $683 
billion worth, the largest single tax increase in American history. 
That averages out to almost $3,000 per family every year. And I know 
$3,000 doesn't sound like a lot in Washington, DC, where we squander 
billions, but for families back in Texas, and I think most middle class 
families, that is far too much to bear, especially with prices being 
what they are.
  I guess the question we always have, those of us who believe we ought 
to have lower taxes and less spending, is why does the Democrat budget 
insist that families tighten their belt but they don't do anything to 
tighten the belt up here in Washington?
  Our public wants us to spend more wisely, not more. And they believe 
tax is too high. This budget is just the opposite.

                              {time}  1945

  I don't know of any economist that thinks tax increases are good for 
an economy in an economic slowdown, and the timing now is particularly 
bad. Our economy has suffered some serious shocks: Skyrocketing oil 
prices, the housing meltdown and mortgage crisis. We certainly don't 
need another one from here in the Halls of Congress.
  And I have to tell you, too, I enjoy hearing about all the class 
warfare issues. So, we just asked an independent source, the 
Congressional Budget Office, are the rich getting richer under 
President Bush? They say the facts are just the opposite. Quoting from 
them, the period between 2000 and 2005 has not been a time of surging 
income inequality. Instead, the income gains of the top wealthy 1 
percent actually slowed during this period. In contrast, between 1992 
and 2000, President Clinton's years, the average income of the top 1 
percent skyrocketed by 84 percent. So the king of inequality is 
President Clinton. They just want to try to hang it on President Bush.
  And if you look at the charts, again by the independent Congressional 
Budget Office, it shows that for middle-class America, aftertax 
household income actually increased, the highest level since they've 
been recording these values.
  And if you take a look at the total effective tax rate, what we've 
seen as well is that the tax rates and the cost for middle-class 
Americans has gone down to a historic rate as well. So, they are 
earning a record amount of income. They are paying a record fewer 
amount of taxes. And so middle-class families in America are trying to 
battle these high prices that this new Democratic Congress is bringing 
us by trying to keep just a little more of what they earn.
  A major tax increase now, when Americans are planning for the future, 
will only add fuel to the fire and threaten to throw us deep into a 
recession. You only have to take out a history book to remember the tax 
increases imposed during the 1930s worked to worsen economic conditions 
during that time. And the economic growth in the 1990s came about 
because of spending restraint, and then what turned out to be an 
artificial economy. But Democrats, as I've said, would like the 
American public to believe that these tax hikes will only affect the 
wealthy. Let me tell you, it's going to affect middle-class America. 
They are dead wrong.
  These tax increases the Democrats propose, the largest tax increase 
in American history, will affect real working families. Any individual 
that gets married, that has children, that receives maybe a nest egg 
from their small business or the family farm, maybe makes a good 
investment, saves for retirement, all of them, all of you will pay more 
in taxes. Is this what the American people want or deserve? And the 
answer is no.
  Today, while we have Democrats say they are shooting at the wealthy 1 
percent, what they are really hitting is middle class America because, 
as I said before, the rate of taxes paid for by the wealthy 1 percent 
is actually growing. What we need to do is keep taxes low for middle-
class America. Those tax hikes will hurt workers and small businesses, 
the very people we need investing and growing, by taxing them an 
average of 12 percent more than we do now. That's 12 percent less money 
that they can keep to grow their business or invest in their company or 
maybe create another new job here in America. And unfortunately, 
raising those taxes is a big incentive for companies to move 
investments overseas instead of here at home. It's bad enough this 
Congress has tried to outsource U.S. energy jobs, now we're trying to 
outsource the rest of America's jobs as well.
  And this Democrat budget, I can tell you, does not provide funding to 
keep the State and local sales tax deduction in place. They don't have 
any money for the research and development tax credit. They don't even 
have any money for the college tuition tax credit. What they say is, we 
endorse this

[[Page 3905]]

tax relief. We endorse it. That's like having your son come to you and 
ask for allowance and you tell him, I don't have any money, but I 
endorse your idea of an allowance.
  The Republican budget actually budgets for that tax relief to make 
sure that families aren't punished, middle-class families aren't hurt 
by $3,000 more every year of new taxes. And what we say is Washington 
ought to tighten its belt before we ask American families to tighten 
theirs.
  And I'll tell you, too, not only does the Democrat budget raise the 
deficit, but this budget fails greatly and does not address serious 
entitlement reform, which is critically needed if we are to sustain 
Medicare and Social Security for future generations.
  It ignores the inevitable and punts the problem down the road. 
Instead of making the tough choices today, which is what the American 
public wants, their budget is long on words, but short on action. They 
call on experts to develop ``options'' and saying that action is 
``needed.'' More words, no action, and the problem gets bigger.
  In just 7 short years, entitlement spending on Medicare, Medicaid and 
Social Security will consume nearly two-thirds of our entire Federal 
budget, and then it gets worse. These programs will grow to such a size 
that they will be equal to the cost of the entire Federal Government 
today, and Americans will have to pay twice the taxes just to keep it 
in place.
  Our economic growth is at risk in this Democrat budget. It makes it 
more unfair for middle class America; it ignores Social Security and 
Medicare, which we need to make solvent and preserve once and for all; 
it raises the deficit; and it basically turns a blind eye to American 
families who are struggling to make ends meet with rising costs the way 
they are.
  And they all say, well, we endorse the tax relief you have today. 
Well, Republicans don't endorse it, we embrace it. We include it. We 
pay for it. And we do balance the budget. And you know what we do? We 
make a huge sacrifice. We ask Washington to just slow spending by 3 
percent. That's all we do. We're not asking to cut major programs. 
We're not asking for major sacrifices. We're saying, before you force 
our families to pay $3,000 more a year, why don't you just tighten your 
belt just a little, just 3 percent over the next 5 years. That's all we 
do to balance this budget. That's the smart way to balance the budget. 
That's the fair way, especially for middle class families. And for our 
economy, it's the smart way to revive jobs, to create a strong economy, 
and keep jobs growing in America.
  And with that, Mr. Chairman, I reserve the balance of my time.
  Mrs. MALONEY of New York. I thank the gentleman for his testimony, 
but I want to point out that you have to remember that the Republican 
Congress and President Bush have been in charge of this economy for 7 
years. And when President Bush came into office in 2001, he inherited a 
projected 10-year budget surplus of $5.6 trillion. And he inherited a 
government in good financial shape, prepared to deal with the budget 
challenges that the country confronts. And yet under his tenure, under 
his leadership and a Republican Congress, they turned this surplus into 
an $8.8 trillion hole, the biggest reversal in history.
  And we have to remember that President Bush gave us a series of 
records, but they're the wrong kinds of records. This country now has 
the largest debt in the history of our country, $9.6 trillion. Each 
American owes $30,000 of this debt. And we have the largest trade 
deficit. They have dug us into an $8.8 trillion reversal, and this was 
given to us by the Bush administration and the Republican Congress.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BRADY of Texas. Mr. Chairman, I yield 6 minutes to the gentleman 
from Texas (Mr. Paul).
  Mr. PAUL. Mr. Chairman, I am pleased to address the House tonight 
about the budget because there has been a lot of concern expressed here 
today on both sides of the aisle about the kind of financial trouble 
we're in. And there's no doubt about that. But sometimes I think we go 
back and forth spending more time blaming each other rather than 
dealing with the real problem.
  One of the contentions I've had about the budget is that we look at 
it as an accounting problem rather than a philosophy problem because 
the spending occurs because of what we accept as the proper role of 
government. And right now, it's assumed by the country as well as the 
Congress that the proper role of government is to run our lives, run 
the economy, run the welfare state, and police the world. And all of a 
sudden, it puts a lot of pressure on the budget.
  Today, the national debt is going up almost $600 billion. And the 
economy is getting weaker, there's no doubt about it. We're in a 
recession, it's going to get much worse, which means that the deficit 
is going to get a lot worse. And I'm predicting within a couple of 
years, it will not surprise me one bit to see the national debt, the 
national obligation for future generations to rise in 1 year three-
quarters of $1 trillion. And that is a very possible number.
  And like it has been expressed so often today, we need to do 
something about it. The question is, what are we going to do about it? 
One side, it seems like, well, if we just raise taxes, we're going to 
solve the problem. The other side says, well, all we have to do is get 
rid of the earmarks. Well, that argument, I think, falls short, too, 
because you can vote to cut all the earmarks, but it doesn't cut any 
spending, it just delivers the authority to spend the money to the 
executive branch. I think the job of the Congress is to earmark the 
money. It's our obligation to tell people how the money is spent.
  And those who think that we can solve this problem by just getting 
rid of earmarks, they never talk about the earmarks overseas, the 
hundreds of millions, if not billions, of dollars we spend overseas. We 
earmark them to certain countries, into building military buildings 
overseas. What about the earmark for the embassy in Iraq? It has cost 
$1 billion. That's an earmark. But the side that said that we can solve 
this problem by cutting earmarks never talks about these earmarks.
  Just think of the earmarks in the military budget. I mean, billions. 
And what do we do? We finally elect a different Congress to deal with 
some of these supplementals and emergency spending that we don't have 
the guts to put on the budget, so we elect a new Congress. And what do 
we do? We have the continuation, in all the budgets presented today, 
we're still going to finance the war as an off-budget emergency item. 
We're not being honest with ourselves. And we pretend that the problem 
is there, and that if you talk about it, it's going to go away.
  The way I see it is there's only one way that we're going to attack 
this, and that is, decide what our government ought to be doing. And 
the Constitution is very clear, the government ought to preserve our 
liberties and give us a strong national defense. It shouldn't run our 
lives, it shouldn't run the economy, it shouldn't police the world. 
We're not supposed to be the policemen of the world. But everybody 
talks about it.
  And both sides of the aisle have no hesitation to spend every cent 
the executive branch asked for to run a war that was never declared. We 
now spend $1 trillion a year going up, this year it's going to go over 
$1 trillion to run the operations overseas. That means all the foreign 
aid and all the military, $1 trillion to do things we shouldn't be 
doing.
  They interviewed 3,400 military personnel just recently, military 
leaders, and 82 percent of them said our military is weaker today than 
it was 5 years ago. So, all of this money spent and all this policing 
in the world, and all this deficit.
  And financially we're coming down. I mean, just today the dollar went 
down 1.2 percent in one day, after this steady erosion. It comes from 
the fact of deficits. And why does that hurt the dollar? Because we 
don't have enough money. We don't tax enough. We can't tax anymore. 
People are overtaxed. We can't borrow anymore because interest rates 
will go up. So, we print the

[[Page 3906]]

money. And the more money you print, the further the dollar goes down, 
and then everything goes up in price. So it's a cycle that's coming to 
an end.
  The value of the dollar is really telling the whole story. We've 
overextended ourselves because we do not challenge the whole notion of 
what we ought to be doing here and what our government ought to be all 
about because we have drifted so far from the original intent of the 
Constitution. There is no hesitation, there are debates that go on here 
endlessly. One side of the aisle says, well, we need more and more 
money for the military; we can't cut one single cent on overseas 
expenditure. And the other side says, oh, no, we can't cut the 
entitlements. And then there's an agreement, we raise both.
  My idea is to have a strong national defense and to get this budget 
under control. Reject the notion that we need to run an empire; we 
can't afford it, it's going to come down, it always comes down. It has 
come down all throughout history because eventually the currency is 
destroyed.

                              {time}  2000

  We're in 130 countries. We have 700 bases. Our military now is in 
worse shape than it was 5 years ago, according to our military. So it's 
time we look at the strategic, the philosophic problems. And I will 
say, unless we do this, this will end badly. It's going to end with a 
major economic crisis. It's going to be worldwide, and we here at home 
will suffer, not only economically but inevitably. Under these 
conditions the people lose their liberty, and our liberties are being 
eroded every single day that we're here.
  So, yes, we take an oath to obey and uphold the Constitution against 
foreign and domestic. But we're domestic, and we should protect our 
rights and our budget and the greatness of this country.
  Mr. BRADY of Texas. Mr. Chairman, I would yield 4 minutes to the 
gentleman from Michigan (Mr. Knollenberg), one of our leaders in this 
conference and one of our most distinguished leaders.
  Mr. KNOLLENBERG. Mr. Brady, thank you very kindly for yielding. I 
appreciate that very much.
  Mr. Chairman, I rise tonight on behalf of the hardworking men and 
women of Michigan and particularly of my Ninth District.
  It will come as no surprise to most to hear me say that Michigan has 
been struggling mightily of late. For the past 6 years, we have 
suffered from incomparable job losses throughout Michigan. In fact, 
Michigan was the only State in the Union to have lost jobs in each and 
every year of that time frame. Our unemployment rate has been the 
Nation's highest, or close to it, for longer than anyone can remember. 
Home foreclosures are up. Wages are down. Costs seem to be rising at 
every turn. To put it lightly, the people of Michigan are facing some 
tough times.
  Not too long ago, the Governor of Michigan proposed an income tax 
increase. The citizens were on the verge of revolt. The State 
government actually shut down for a bit. As Michigan families 
struggled, the last thing they thought they deserved from their 
government was a bigger tax bill. But, sadly, they got one anyway.
  Now the leadership of this body wants to send the good people of 
Michigan and the people across the country another tax increase. In 
fact, they want to send, as has been said before, the biggest tax 
increase in American history.
  Well, I'm here to say, and to say strongly, enough is enough. Enough 
with higher taxes. Enough with wasteful spending. Enough.
  Analysts have calculated that the average family in my district would 
see their taxes go up by more than $4,100 if this budget were to be 
enacted. That's $4,100 that families in Oakland County simply cannot 
afford. Worse yet, we know that a tax increase this big would do 
serious harm to the economy, costing even more jobs and putting more 
people out of work.
  The other problem is, and some have told me that my district alone 
would lose some 2,000 jobs in the wake of this scale of tax increase. I 
do not want to let that happen.
  Many are concerned that the national economy is showing signs of 
weakness. I submit to my colleagues the weakness you may be seeing is 
just a common cold compared to the prolonged pneumonia Michigan has 
suffered from during its single-State recession.
  I'm going to fight and fight hard to protect Michigan's families, as 
every Member here I know would protect the people from their own 
States, protect them from higher taxes. Taking more of their hard-
earned money from their pockets will only lead to more problems, more 
job losses, and more hardships.
  So I repeat: Enough with higher taxes. Enough with wasteful spending. 
Simply, enough.
  If you're thinking of voting for a tax increase this big, I'd invite 
you to come to see me in Michigan. There you can see firsthand what 
higher taxes do to an economy. Higher taxes shutter factory doors. They 
close small businesses, and they hurt families right to the core. This 
budget, and the $4,000 increase that comes with it for Oakland County's 
families, is simply unacceptable.
  Instead of raising taxes, we should be focused on solutions that will 
strengthen the economy, create jobs, encourage investment, and foster 
innovation. Raising taxes would do the exact polar opposite.
  So I strongly urge my colleagues, Mr. Chairman, to reject this 
massive tax increase on average Americans. I know firsthand how much 
harm it would do to Michigan's families, and I have every reason to 
believe it would do the same to families across America.
  Mrs. MALONEY of New York. May I inquire of the Chair how much time 
remains on the Democratic side and how much remains on the Republican 
side.
  The Acting CHAIRMAN. The gentlewoman from New York has 13\1/2\ 
minutes. The gentleman from Texas (Mr. Brady) has 10\1/2\ minutes.
  Mrs. MALONEY of New York. Mr. Chairman, I yield myself such time as I 
may consume.
  To respond to some of the points made by the gentleman from Texas on 
the high cost of the war, the gentleman from Texas has pointed out that 
the war is not paid for, that it's off budget, and I support his 
recommendation that it should not be in a supplemental emergency 
spending bill.
  This chart here shows the Federal spending on the Iraq war versus 
other priorities in the 2008 budget authorization. The Iraq war is 
costing, the request, twice as much as is in the Federal budget for 
transportation for the entire country, and it is five times more than 
what is in the budget now for the National Institutes of Health. It is 
seven times more than the college tuition assistance. So this is really 
costing Americans a great deal of money that could be spent on other 
priorities.
  This chart here shows that the administration wants to spend $435 
million on Iraq every day. And each year that money could be used to 
enroll for an entire year 57,000 children in Head Start, fund an 
additional 150,000 Pell Grants for low-income students for an entire 
year, save 290,000 families from losing their homes. It could hire for 
an entire year an additional 10,000 Border Patrol agents. It could hire 
more than 9,000 police officers for a year, and provide health 
insurance for 330,000 low-income children through the SCHIP program. 
So, for $435 million that they are requesting for Iraq every day, you 
could provide for an entire year health insurance for over 330,000 low-
income children.
  So I really want to join my colleague from Texas in his comments on 
the spending on the war.
  Mr. Chairman, I reserve the balance of my time.
  Mr. BRADY of Texas. Mr. Chairman, I yield myself 20 seconds.
  I would make the point that this new Democrat leadership promised to 
pay for this war. They vowed riding into office that's what they would 
do. They had three opportunities last year and this year to fund that 
war. The budget of last year, the emergency spending,

[[Page 3907]]

and the budget again for this year. Guess how much is paid for? Zero. 
Zero money.
  It's one thing to make promises to be fiscally responsible. It's 
another thing not to be fiscally responsible.
  Mr. Chairman, with that, I would yield 5 minutes to one of our 
conservative leaders in Congress, a woman who has fought very hard for 
middle class families in Tennessee and this country, the gentlewoman 
from Tennessee (Mrs. Blackburn).
  Mrs. BLACKBURN. I thank the gentleman from Texas for yielding.
  And, Mr. Chairman, I am so pleased to come to the floor and 
participate in this debate. I think it's one of the most important 
debates that we have every single year.
  And listening to all the comments that are taking place here this 
evening, Mr. Chairman, it is not lost on me. Budgets are supposed to be 
about priorities. Budgets should reflect the priorities of a nation, 
and they should lay out the funding for what we think is important, 
where we should spend the taxpayers' money.
  And I think we have to stop there and pause just a moment because, 
Mr. Chairman, when I listen to some of our colleagues make comments, as 
my dear friend from New York just made, talking about all the good 
things that could be done with money, this is not our money. I do admit 
that the Federal Government has first right of refusal on the 
taxpayers' paycheck. I recognize they do that. I don't agree with that. 
But I think what we have to do is say having first right of refusal 
isn't right, but the taxpayer turns that money over willingly, and they 
have the right to know how we spend their money. They have the right to 
know what those priorities are going to be. So all the functions of the 
budget are supposed to lay those priorities out.
  Now, Mr. Chairman, when I have talked with my constituents about this 
budget, the number one thing that they have said is this: With the way 
the taxes are going up, with the way the spending is going up in 
Washington, I am having too much month left over at the end of my 
money. And they think the priority reflected in this budget ought not 
to be the Federal Government's having first right of refusal on that 
paycheck. The first priority ought to be leaving that paycheck with the 
person that earned it. Well, what a novel idea. What a novel idea.
  Well, let's just look at what we see in the Democrat leadership's 
budget. Well, the largest tax increase in American history. Here it is. 
And you can see previously we had $241 billion in 1993. That was 
President Clinton's tax increase. But now look at the number over 
there: $683 billion in tax increases over a 5-year period of time to 
pay for the spending that this House wants to participate in.
  Well, we know this is going to be costly. So when you look at a chart 
of what it's going to cost every State, $2,611 is what it will cost the 
average Tennessean. In my district in Tennessee, that number is $2,668.
  Well, taxes seem to be a priority, enough of a priority that this 
Democrat leadership wants to increase taxes on my constituents in the 
Seventh District of Tennessee $2,668. But, Mr. Chairman, they had the 
opportunity to extend sales tax deductibility, which those of us in 
Tennessee have enjoyed because we don't have a State income tax. And 
every Democrat on the Budget Committee voted against giving that tax 
relief to my constituents in Tennessee because they wanted higher 
taxes.
  Well, the question is, what are they going to do with this tax money 
once they get it? And here is a chart that shows their discretionary 
increases. Well, we see $23 billion above the request in fiscal 2009. 
And, whoops, look at what's going to happen over there: $280 billion. 
And what does that discretionary spending buy the taxpayer? Well, Mr. 
Chairman, there are $280 billion worth of earmarks. We're going to have 
another $280 billion, not hundred, not thousand, not million, but 
billion with a ``b,'' $280 billion worth of earmarks that we are going 
to see over a 5-year period of time.
  The American people have said enough is enough. They want that 
discretionary spending to come down. They want the earmark spending to 
come down.
  Well, let's take a look at one more thing, and that is entitlements. 
And we don't even have enough time, obviously, to address that. This 
House has chosen not to address it. This leadership has chosen not to 
address it. And look at this chart. By the time we get to 2030, it is 
going to take every tax dollar coming in to pay for the entitlements of 
Medicare, Medicaid, and Social Security.

                              {time}  2015

  We know there is a crisis coming with entitlements. We know that we 
are going to see earmarks increase. And my constituents are telling me 
they've had enough of it. They've got too much month left over at the 
end of that money, and they want to keep more of that money in their 
pocket.
  Mr. BRADY of Texas. At this time, I would reserve the balance of my 
time.
  Mrs. MALONEY of New York. Mr. Chairman, how much time is left on the 
Democratic and Republican sides?
  The Acting CHAIRMAN (Mr. Wilson of Ohio). The gentlewoman from New 
York has 11 minutes remaining. The gentleman from Texas has 5\1/4\ 
minutes remaining.
  Mrs. MALONEY of New York. Mr. Chairman, I would like to comment on 
the statement that my good friend and colleague from the State of 
Tennessee claims that this is the largest tax increase in history. But 
all we are doing as Democrats is applying the basic rules of fiscal 
responsibility to expiring tax provisions.
  Tax cuts should not be financed with borrowing. Tax cuts are not true 
tax cuts if they are not paid for. We have committed to preserve 
middle-class tax cuts if they can be properly paid for in 2010.
  And if I could, Mr. Chairman, I will quote from nonpartisan budget 
groups that agree that the House budget resolution does not raise 
taxes. These are nonpartisan groups, The Hamilton Project of the 
Brookings Institute, ``The House Budget Committee's budget resolution 
would not raise taxes.'' The Center on Budget and Policy Priorities, 
``Neither of the plans that the House and the Senate recommended this 
week by the Budget Committees include a tax increase.'' The Concord 
Coalition, ``Applying PAYGO, pay-as-you-go, rules to expiring tax cuts 
does not constitute a tax increase. It constitutes a policy decision 
requiring a balancing of priorities. That is what budgeting is all 
about.''
  I reserve the balance of my time. I yield to my colleague, 
Congressman Brady. And we have no other speakers on my side. So after 
you close, I then will close for my side.
  Mr. BRADY of Texas. I thank the gentlelady.
  I yield myself such time as I may consume to close.
  I don't know where those fairy tales come from, I don't mean from the 
gentlelady, but some of these special interest groups. But I'm looking 
at the budget, page 37, I look at this title III called ``reserve 
funds.'' It doesn't have any money in it, but it is called ``reserve 
funds.'' It is empty. It says they have all these reserve funds for tax 
relief, middle-income tax relief, alternative minimum tax relief, 
higher education, and sales tax deduction.
  Here is the problem: I then turn to the page where the line item is 
for these reserve funds, and it is zero. It is zero in the budget. All 
these tax cuts that are so important for families and small businesses 
will go away. In fact, if you ask the question, will those taxes 
increase in order to balance the Democrat budget? The answer is 
absolutely yes. Absolutely yes.
  And the reason you know this is that every independent organization 
from government who has examined this budget knows and states, we will 
see the largest tax increase in American history.
  Let us get down to this point, though. We do have common ground, the 
Republicans and the Democrats, on balancing the budget. There is no 
question about it. We believe it needs to be done. Here is the 
difference between the two parties. Republicans believe

[[Page 3908]]

that we should not raise taxes on families and small businesses, that 
we should have spending restraint, just a small amount, 3 percent, 
Washington tighten its budget belt before families do, we tackle Social 
Security and Medicare in a meaningful way to preserve it, and we enact 
a 1-year moratorium on frivolous earmarks so we can stop using those 
hippie museums and the bridges to nowhere and those just embarrassments 
of spending, that we can go back and come up with a commonsense way of 
do it in moderation.
  The Democrat budget has a different approach. You may like it. They 
raise taxes about $3,000 on every family every year in America. They 
have higher spending, the largest spending budgets in American history. 
There is no action to preserve Social Security or Medicare, and 
earmarks continue unabated. And we have already seen the results of 
this in the past year. When Republicans held control of Congress, we 
spent too much. We spent too much, and the deficit got as high as $412 
billion in 2004. It was wrong. Every year we have whittled it down, 
until the last Republican budget was $162 billion deficit. That is 
better than half, but that is not good enough. And in the 1-year budget 
Democrats have had, they have more than doubled, $357 billion deficit 
projection according to the Congressional Budget Office, and this 
year's deficit may be larger than that. The compass is going in the 
wrong direction. America doesn't need to have their taxes raised. 
Washington needs to tighten its belt, especially before we ask our 
families to tighten their belt. We need to tackle Social Security and 
Medicare. We need to call a time-out on these frivolous earmarks. And 
we need some spending restraint that the American people believe that 
we can do.
  This is a bad budget for the values and the future of America. It 
harms our families and small businesses and resorts to budget gimmicks. 
It will never be a balanced budget. The Republican alternative is a 
sensible one that will do that the right way. The right choice is the 
Republican budget.
  With that, I yield back my time.
  Mrs. MALONEY of New York. I thank the gentleman for his participation 
tonight.
  And I just would like to respond that the Republican budget proposal 
claims to pay for tax cuts with enormous, but unspecified, cuts in 
government spending. But when my Republican colleagues were in charge 
of Congress, along with the President, they did not cut spending. 
Instead, spending and earmarks grew massively. And so did the Federal 
debt.
  My Republican colleagues and the President gave this country a series 
of records, but they were the wrong kinds of records. They gave us 
record debt, $9.6 trillion, the largest in the history of this country. 
So when they talk about financial responsibility, this is what they 
gave this country when they inherited a surplus. They gave us the 
largest debt in history. Every American owes $30,000 to this debt. They 
also gave us the largest trade deficit in history. And they also gave 
us the largest deficit in history.
  So what we have before us, Mr. Chairman, is a responsible budget put 
forward by the Democratic leadership. And, Mr. Chairman, the challenge 
for this Congress is to return to the fiscal discipline that has been 
squandered by the President and his party over the past 7 years giving 
us the largest debt in history.
  Today, Democrats in Congress present a realistic budget plan that 
adheres to PAYGO principles. We eliminate President Bush's deficits by 
2012 and make the investments necessary to strengthen our economy and 
make Americans safer.
  I want to remind my colleagues that under the Clinton administration, 
every year the deficits got smaller. But under the Bush administration, 
every year they have gotten larger. Our budget, the Democratic budget, 
provides health care for millions of additional uninsured children. We 
make critical investments in defense and our veterans health care. We 
also restore crucial funding for Medicare and Medicaid, as well as 
State and local law enforcement programs.
  In order to spur innovation that will keep America number one, we 
provide increased funding for math and science education and research. 
We also expand renewable energy and energy efficiency programs to 
reduce global warming and our dependence on foreign oil. And we provide 
new training opportunities to prepare workers for green collar jobs. 
Our budget makes important investments in infrastructure to begin to 
rebuild our crumbling bridges and levees.
  Democrats target tax relief to families struggling to make ends meet 
in the face of an economic downturn. Our plan extends middle-income tax 
breaks, including the child tax credit and marriage penalty relief, and 
we protect 20 million middle-income American families from being 
snagged by the alternative minimum tax.
  Mr. Chairman, this budget resolution is an important step towards 
putting our financial fiscal house back in order and creating greater 
economic opportunities and prosperity for all American families.
  Mr. SMITH of Nebraska. Mr. Chairman, when I'm back in Nebraska, I 
take the opportunity to listen to my constituents about the challenges 
they face in their day-to-day life.
  The high cost of fuel, rising energy prices, and the overall strength 
of the American economy are all concerns for Nebraskans and all 
Americans.
  Now is the time for Congress to step up to the plate and act with 
common-sense and fiscal responsibility.
  The budget resolution we are debating, however, lets the American 
people down on those two fronts.
  Instead of supporting common-sense budget process controls and 
responsible spending levels, this budget systematically guts a range of 
budget process tools, from the Majority's own PAYGO rule to abandoning 
any criteria for emergency spending.
  In other words, the policies which make it easiest to tax-and-spend.
  This budget hikes discretionary spending by $204 billion over 5-years 
on top of the Administration's proposed increase, the Majority loaded 
up their resolution with over 20 so-called spending ``reserve funds,'' 
and increased reliance on budget gimmicks, such as advance 
appropriations.
  Unfortunately, this budget increases spending, raises taxes to 
historic levels, refuses to fix the AMT--which will hit millions of 
middle-class taxpayers if nothing is done.
  It does nothing to rescue Social Security, Medicare or Medicaid 
despite the fact the Budget Committee has heard time and time again 
that something must be done about entitlement spending.
  Regrettably, the budget we will consider today appears to simply 
underscore this Majority's insistence on reckless spending, chased by 
record tax hikes on American workers and businesses, and massive debt 
burdens for future generations.
  Nebraskans--and all Americans--have called for Congress to live up to 
its fiscal responsibilities.
  Today, however, we are debating a bill which badly misses the mark.
  I urge my colleagues to take a stand against this budget--which 
proposes hundreds of billions of dollars in new government spending 
paid for with the largest tax hike in American history.
  Mr. WOLF. Mr. Chairman, I am deeply disappointed that the FY 2009 
budget resolution we are considering today continues business as usual 
in the House. This resolution is another missed opportunity to come to 
grips with the financial crisis looming on the horizon for our Nation. 
We face enormous fiscal challenges and addressing them will take 
bipartisan commitment. The budget resolution--and all of the 
substitutes--fail to address the long-term spending crisis staring us 
right in the face.
  Jim Cooper and I have been working together with almost 70 cosponsors 
from both sides of the aisle ii offering a solution--the Cooper-Wolf 
SAFE Commission Act--to respond to what outgoing U.S. Comptroller David 
Walker characterizes as a ``tsunami of spending and debt levels that 
could swamp our ship of state.''
  At the Government Accountability Office, Mr. Walker has coordinated 
the country-wide ``Fiscal Wake Up Tour'' and has done a tremendous job 
of working to educate the American people on the grave condition of our 
country's fiscal health. I salute David Walker for the yeoman work he 
has done in bringing this issue to the front burner. He is leaving GAO 
this week, but he is not abandoning the cause in which he believes and 
into which he has poured his heart and soul over the past few years. He 
was quoted as saying, ``I love my job. I love GAO. But I love my 
country more.''

[[Page 3909]]

  Republicans and Democrats must take to heart David Walker's words--
for the love of country--and come together to avert the financial 
tsunami coming closer and closer to our Nation's shores. It doesn't 
take an expert to understand that this nation is teetering on the edge 
of a financial crisis like no other time in our history.
  We had the opportunity in this year's budget process to take the 
initial steps to get our financial house in order. But again this 
budget cycle, the House is choosing to look the other way and continue 
business as usual.
  If we don't get our country's financial house in order and make the 
sacrifices necessary today, the future for our children and 
grandchildren will be bleak. Our economic growth will come to a 
grinding halt, our standard of living and even our national security 
will be at risk if we don't start actively working to change our 
current course. We cannot continue to keep borrowing and mortgaging our 
future to countries like China and Saudi Arabia that carry obscene 
amounts of our debt.
  This issue is an economic and moral issue that hangs like an ominous 
cloud over everything we do as public servants, yet many ignore it. I 
understand we won't be able to fix our financial woes overnight, but we 
must come together across the aisle if there is ever to be any hope of 
ensuring that our Nation's future is strong.
  That's why Representative Jim Cooper and I joined efforts and have 
been calling for a national bipartisan commission that will put 
everything--entitlement spending, other Federal program spending and 
tax policy--on the table and come up with recommendations to halt the 
mounting debt.
  Nothing would be off limits for discussion by the commission members.
  A critical component of the commission's work will be to engage the 
American people in a national dialogue about the scope of the country's 
financial conditions and solutions to the problem. After spending 6 
months conducting townhall-style meetings around the country, the 
commission will present a report to Congress describing the long-term 
fiscal problems, public suggestions and views, and policy options 
available to get us back on the right track.
  Modeled after the Federal base-closing process, Congress would be 
required to vote up or down on the plan in its entirety. Mandating 
congressional action is what makes the SAFE Commission unique. If other 
viable bipartisan solutions are presented, I think we should look at 
those, too.
  The Cooper-Wolf SAFE Commission legislation has been endorsed by 
groups across a wide political spectrum--groups who usually disagree 
more than they agree on policy issues--the Brookings Institution, the 
Heritage Foundation, the Concord Coalition, and the Committee for a 
Responsible Federal Budget. The Business Roundtable and National 
Federation of Independent Business are also on board. National 
columnists David Brooks, David Broder, and Robert Samuelson all have 
written about the entitlement crisis facing our country and the SAFE 
Commission as a potential way forward. Senators Conrad and Gregg have 
introduced similar legislation in the Senate.
  The financial tsunami is moving closer to our shores and the longer 
we wait to act, the harder it will be to stop the tidal wave of red 
ink. If our children and grandchildren were on the beach with an actual 
tsunami off the coast, we would do everything we could to help them. We 
must move beyond politics and come to grips with the fact that the 
financial future of our country is an American issue and it's on our 
watch to fix.
  How can this Congress sit by knowing full well that our financial 
woes will haunt generations to come?
  I could easily use all the time for general debate today providing 
the evidence to support the critical need to address the nation's 
financial future. This should be the number one budget priority for 
this Congress. Let me give an example. In January, Moody's Investors 
Service released its annual report which concluded that the United 
States triple-A bond rating is at risk. The United States could lose 
its triple-A bond rating as early as 2012. What does that mean?
  That means that respected credit-rating agencies are projecting that 
the United States will be on par with Greece and Estonia by 2015, 
Poland and Mexico by 2020, and below investment grade--junk debt--by 
2025.
  Here's more evidence: the retirement of the baby boomers started this 
year and presents a demographic challenge that is unprecedented. In 
2006, Medicare, Medicaid, and Social Security consumed 40 percent of 
the budget. That percentage is expected to jump to 51 percent in less 
than 10 years. It may be out of sight, out of mind for now, but it's 
simple math. As the number of Americans aged 65 and up rises, and the 
working population shrinks, more Americans will draw on promised 
benefits. The rubber will meet the road, and we will have done nothing 
to cushion the blow.
  We cannot continue to avoid our responsibility to future generations 
of Americans by passing on a broken system in the form of unfunded 
Social Security and Medicare obligations and unsustainable spending.
  Simply put, the budget resolution set forth this year represents a 
missed opportunity. We need to follow the example of David Walker and 
for the love of our country, and for our children and grandchildren, do 
what it will take to protect our Nation's future. The SAFE Commission 
is the bipartisan way forward. Mr. Speaker, I would like to insert for 
the Record a letter I received from U.S. Comptroller General David 
Walker, a recent Financial Times article about our Nation's triple-A 
bond rating, and a Robert Samuelson op-ed from The Washington Post.

              [From the Washington Post, October 3, 2007]

                      Escaping the Budget Impasse

                        (By Robert J. Samuelson)

       Almost everyone knows that the next president will have to 
     wrestle with the immense costs of retiring baby boomers. 
     Comes now a small band of Democrats and Republicans who want 
     to do the new president a giant favor. They want to force the 
     new administration to face the problem in early 2009. Why is 
     this a favor? Because dealing with this issue is so 
     politically unsavory that resolving it quickly would be a 
     godsend. Otherwise, it could haunt the White House for four 
     years.
       Let's review the problem (again). From 2000 to 2030, the 
     65-and-over population will roughly double, from 35 million 
     to 72 million, or from about 12 percent of the population to 
     nearly 20 percent. Spending on Social Security, Medicare, and 
     Medicaid--three big programs that serve the elderly--already 
     represents more than 40 percent of the federal budget. In 
     2006, these three programs cost $1.1 trillion, more than 
     twice defense spending. Left on automatic pilot, these 
     programs are plausibly projected to grow to about 75 percent 
     of the present budget by 2030.
       Stalemate results because all the ways of dealing with 
     these pressures are controversial. There are only four: (a) 
     massive tax increases--on the order of 30 to 50 percent by 
     2030; (b) draconian cuts in other government programs (note 
     that the projected increases in Social Security and Medicare, 
     as a share of national income, are more than all of today's 
     domestic discretionary programs); (c) cuts in Social 
     Security, Medicare and Medicaid--higher eligibility ages or 
     lower benefits for wealthier retirees; or (d) undesirably 
     large budget deficits.
       The proposed escape seems at first so drearily familiar and 
     demonstrably ineffective that it's hardly worth discussing: a 
     bipartisan commission. But what would distinguish this 
     commission from its many predecessors is that Congress would 
     have to vote on its recommendations. The political theory is 
     that, presented with a bipartisan package that cannot be 
     amended, most politicians would do what they believe 
     (privately) ought to be done rather than allow pressure 
     groups, including retirees, to paralyze the process.
       There is precedent for this approach. Since 1988, Congress 
     has allowed more than 600 military bases and facilities to be 
     closed or streamlined using a similar arrangement. An 
     independent Base Realignment and Closure Commission evaluates 
     the Pentagon's proposed closings and listens to objections. 
     With the president's approval, it then submits its own list, 
     which goes into effect unless vetoed by both houses of 
     Congress. This process provides members of Congress 
     bipartisan ``cover'' and prevents amendments from weakening 
     the package.
       Two prominent proposals would adapt this approach to the 
     budget. The first, offered by Sens. Kent Conrad (D-N.D.) and 
     Judd Gregg (R-N.H.), the chairman and ranking minority member 
     of the Budget Committee, would create a 16-member commission, 
     evenly divided between Democrats and Republicans. All eight 
     Democrats would be from Congress, as would six Republicans. 
     The administration would have two members, including the 
     secretary of the Treasury.
       Conrad's notion is that the impasse is political and that 
     only practicing politicians--people with ``skin in the 
     game''--can craft a compromise that can be sold to their 
     peers. The commission would report in December 2008. Twelve 
     of its 16 members would have to support the plan, with 
     congressional passage needing 60 percent approval (60 
     senators, 261 representatives). These requirements, Conrad 
     and Gregg argue, would ensure bipartisan support.
       The other proposal comes from Reps. Jim Cooper (D-Tenn.) 
     and Frank Wolf (R-VA.) It would also create a 16-member 
     commission, with two major differences. First, only four of 
     its members would be from Congress. Second, though Congress 
     would have to vote on the commission's proposal, there would 
     be some leeway for others--including the president--to 
     present alternatives as long as they had the same long-term 
     budget impact. Any

[[Page 3910]]

     proposal, however, would have to be voted on as a package 
     without amendments.
       A combination of these plans might work best. A 20-member 
     group would be manageable and should include four outsiders 
     to provide different perspectives and, possibly, to build 
     public support. Perhaps the head of AARP should be included. 
     And it would be a mistake to present the next president with 
     a take-it-or-leave-it package. The Cooper-Wolf plan would 
     allow a new administration to make changes--and get credit--
     without being able to start from scratch.
       This commission approach has potential pitfalls: It might 
     create a face-saving package that does little. But everything 
     else has failed. The main political beneficiary would be the 
     next president. It would be revealing if some of the 
     hopefuls--Democrats and Republicans--would show that they 
     grasp this by providing their endorsements. Otherwise, the 
     odds that Congress will even create the commission are slim.
                                  ____

                                                   U.S. Government


                                        Accountability Office,

                                 Washington, DC, January 22, 2008.
     Hon. Frank R. Wolf,
     House of Representatives.
       Dear Mr. Wolf: As we discussed by phone this morning, while 
     it is understandable that many in Congress are rightfully 
     concerned about our current economic slowdown and recent 
     market declines, it is important that the Congress not forget 
     about our much larger structural challenge. Specifically, we 
     must not forget our large and growing fiscal gap which now 
     totals approximately $53 trillion ($53,000,000,000,000) and 
     it is growing by $2 to $3 trillion a year absent any 
     meaningful reforms.
       Approximately three years ago Standard and Poor's issued a 
     publication stating that, absent policy changes, the U.S. 
     Government's debt to GDP ratio was on track to mirror ratios 
     associated with speculative-grade sovereigns. Within the last 
     month, Moody's Investors Service issued its annual report on 
     the United States. In that report they noted their concern 
     that, absent Medicare and Social Security reforms, the long-
     term fiscal health of the United States and our current Aaa 
     bond rating were at risk. These not too veiled comments serve 
     to note the significant longer-term interest rate risk that 
     we face absent meaningful action of our longer range 
     challenge as well. Higher longer-term interest costs would 
     only serve to complicate our fiscal, economic and other 
     challenges in future years.
       I believe that it is critically important that this 
     Congress not just address our short-term economic challenge 
     but also our longer-range fiscal gap. The consequences of 
     failing to do so will over time be much more dire than the 
     current economic and market disruptions we are experiencing.
       As you may know, while our annual deficits have declined 
     for three straight years, our total fiscal imbalance has 
     continued to grow. Absent meaningful budget, entitlement, 
     spending and tax reforms, this imbalance, which is driven 
     primarily by rising health care costs and known demographic 
     trends, will result in a tsunami of spending and debt levels 
     that could swamp our ship of state.
                                  ____


               [From the Financial Times, Jan. 11, 2008]

          United States' Triple-A Credit Rating `Under Threat'

       (By Francesco Guerrera, Aline van Duyn and Daniel Pimlott)

       The U.S. is at risk of losing its top-notch triple-A credit 
     rating within a decade unless it takes radical action to curb 
     soaring healthcare and social security spending, Moody's, the 
     credit rating agency, said yesterday.
       The warning over the future of the triple-A rating--granted 
     to U.S. government debt since it was first assessed in 1917--
     reflects growing concerns over the country's ability to 
     retain its financial and economic supremacy.
       It could also put further pressure on candidates from both 
     the Republican and Democratic parties to sharpen their focus 
     on healthcare and pensions in the run-up to November's 
     presidential election.
       Most analysts expect future administrations to deal with 
     the costs of healthcare and social security and there is no 
     reflection of any long-term concern about the U.S.'s 
     financial health in the value of its debt.
       But Moody's warning comes at a time when U.S. confidence in 
     its economic prowess has been challenged by the rising threat 
     of a recession, a weak dollar and the credit crunch.
       In its annual report on the U.S., Moody's signalled 
     increased concern that rapid rises in Medicare and Medicaid--
     the government-funded healthcare programmes for the old and 
     the poor--would ``cause major fiscal pressures'' in years to 
     come.
       Unlike Moody's previous assessment of U.S. government debt 
     in 2005, yesterday's report specifically links rises in 
     healthcare and social security spending to the credit rating.
       ``The combination of the medical programmes and social 
     security is the most important threat to the triple-A rating 
     over the long term,'' it said.
       Steven Hess, Moody's lead analyst for the U.S., told the 
     Financial Times that in order to protect the country's top 
     rating, future administrations would have to rein in 
     healthcare and social security costs.
       ``If no policy changes are made, in 10 years from now we 
     would have to look very seriously at whether the U.S. is 
     still a triple-A credit,'' he said.
       Mr. Hess said any downgrade in the U.S. rating would have 
     serious consequences for the global economy. ``The U.S. 
     rating is the anchor of the world's financial system. If you 
     have a downgrade, you have a problem,'' he said.
       Moody's did once threaten to cut the rating of some of the 
     U.S. Treasury's debt when Congress refused to pass the 
     president's budget in the mid-1990s. Other large economies, 
     notably Japan in the 1990s, have had to suffer the symbolic 
     blow of losing their top-notch credit rating.
       Last year, David Walker, comptroller general of the U.S., 
     caused controversy when he compared America's current 
     situation with the dying days of the Roman empire and warned 
     the country was on ``a burning platform'' of unsustainable 
     policies.
       Medicare and Medicaid spending, which has risen sharply 
     over the past few decades and now accounts for about 45 
     percent of total Federal spending, up from about 25 percent 
     in 1975, has long been a source of concern.
  Mr. BOUSTANY. Mr. Chairman, I rise today to argue against this 
proposed Democratic budget that would raise taxes on Louisiana 
taxpayers by an average of $2,642 and contains egregious wasteful 
spending.
  Extra money for tax hikes might be in the family budget for people in 
San Francisco, but families in southwest Louisiana do not have extra 
room in their budgets. Wasteful spending and tax hikes are 
irresponsible. The Democratic House leadership must understand that 
American families are facing higher costs at the pump, higher costs for 
healthcare and education, and more money to pay Federal taxes simply 
isn't there.
  The Democratic budget proposal includes a massive $683 billion tax 
increase spread over five years in order to finance wasteful Washington 
spending according to the Congressional Budget Office. Taxpayers in 
Louisiana face average tax increases of $2,642. While failing to 
address growing entitlement programs, House Democrats are proposing 
tens of billions more in new Federal spending facilitated by the tax 
increase.
  In addition, the Democratic budget contains the following: Cuts to 
the child tax credit, from $1,000 to $500 per child; Decreases to the 
adoption tax credit; Decreases in tax-free 401(k) and IRA 
contributions; Tax increases for small businesses averaging more than 
$4,000 per business.
  Mr. Chairman, I cannot in good conscience support a budget that is as 
irresponsible as this one. It is a hamper to American entrepreneurs, 
small businesses and economic growth. Additionally, it hurts American 
families who struggle to pay higher energy prices, healthcare costs, 
housing costs and education costs.
  Our budget is a statement of priorities. Lowering taxes, growing our 
economy and providing for families are my priorities. This Democratic 
budget falls well short.
  Mrs. MALONEY of New York. Mr. Chairman, I yield back the balance of 
my time, and I move that the Committee do now rise.
  The motion was agreed to.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Peterson of Minnesota) having assumed the chair, Mr. Wilson of Ohio, 
Acting Chairman of the Committee of the Whole House on the state of the 
Union, reported that that Committee, having had under consideration the 
concurrent resolution (H. Con. Res. 312) revising the congressional 
budget for the United States Government for fiscal year 2008, 
establishing the congressional budget for the United States Government 
for fiscal year 2009, and setting forth appropriate budgetary levels 
for fiscal years 2010 through 2013, had come to no resolution thereon.

                          ____________________