[Congressional Record (Bound Edition), Volume 157 (2011), Part 1]
[Senate]
[Pages 660-665]
[From the U.S. Government Publishing Office, www.gpo.gov]




                      DISTURBING FISCAL SITUATION

  Mr. HATCH. Madam President, in recent months President Obama has 
frequently discussed our Nation's disturbing fiscal situation.
  He is right to do so.
  Our yearly deficits and accumulated debt hang over the futures of our 
children and grandchildren like a sword of Damocles.
  Though he was late to the table on this issue, President Obama seems 
to have finally recognized the frustration and anger of the American 
people over our Federal fiscal policy.
  Recognizing that you have a problem is an important first step, and I 
applaud the administration for speaking about our Nation's structural 
deficits.
  But this is a critical issue, and any solution will require that 
those responsible give a full and fair accounting of the policies that 
led to this crisis.
  Unfortunately, rather than own up to his administration's complicity 
in our fiscal imbalance, the President prefers to blame our current and 
future fiscal problems on the previous administration.
  For this President, the buck always seems to stop over there.
  This trope is getting old.
  Well before citizens began organizing against this administration and 
its historic spending spree, the President and his Democratic allies in 
Congress were justifying their stimulus program by blaming the previous 
administration. Yet trying to pass off the consequences of the last 2 
years on a long-retired President and a Congress that ended over 4 
years ago is no longer plausible.
  Try as they might, revisionist fiscal history will not absolve our 
friends on the other side for the fiscal decisions made on their watch.

[[Page 661]]

  I will explain that point separately, and in detail, in a few days.
  It is well past time that this administration stop pointing fingers. 
The American people are demanding that their elected Representatives, 
in Congress and the White House, act like adults and fix this fiscal 
mess.
  In a few weeks, President Obama will send Congress his third budget.
  The fact that Treasury Secretary Geithner has already written us 
requesting legislation to raise the debt ceiling does not bode well for 
citizens seeking greater spending restraint from this administration. 
The people of Utah and of this Nation deserve a fair accounting of the 
spending decisions that have led to this request.
  Let me be clear.
  The President's desire for a larger level of public debt is a 
consequence of the fiscal policy choices that he and a Democratic 
Congress have made over the last 2 years.
  Between 2007 and 2010, Democrats enjoyed unprecedented control over 
Federal policy. When the President was inaugurated 2 years ago, he set 
to work with historic majorities in both the House and Senate.
  Never letting a crisis go to waste, he sought a fundamental 
restructuring of the American economy, one in which government would 
play a starring role.
  Thanks to our Founders' design, the American people were able to go 
to the ballot box and give their opinion about these spending policies.
  Unfortunately, the administration and its allies did not curb their 
spending in response to democratic uprisings.
  The people spoke--first in Virginia and New Jersey, then in 
Massachusetts, and finally, last summer, nationwide.
  But the Democrats, rather than adjust their policies accordingly, 
just kept on spending.
  The tab for this binge is almost beyond description. In the 2 years 
that Democrats controlled Washington, our debt has risen by almost $3 
trillion.
  I have a chart documenting these staggering hikes in the debt limit.
  During the short period of all-Democratic rule, the law was changed 
to raise the debt ceiling on three separate occasions.
  On February 17, 2009, President Obama signed a debt limit increase 
bill of $789 billion, the cost of the stimulus bill at that time.
  On December 28, 2009, President Obama signed a debt limit increase 
bill of $290 billion.
  And on February 12, 2010, President Obama signed a third debt limit 
increase bill of $1.9 trillion.
  These dollar figures, in terms of the percentage of the economy they 
represent, are breathtaking. I, like most other Members on both sides 
of the aisle, eagerly await the President's State of the Union Address. 
The President is a gifted speaker. And in his usual, eloquent manner, I 
am sure he will skillfully lay out his fiscal and economic policy 
goals.
  As the incoming ranking Republican on the Finance Committee, let me 
be the first to say that Republicans are happy to hear the President 
contemplating serious deficit reduction proposals. We would be 
overjoyed if he actually took a stand for a meaningful attack on 
structural deficits and the debt.
  But we will judge his proposals harshly if they provide mere window 
dressing, rather than bold efforts to address a spending trajectory 
that is approaching crisis status.
  Willie Sutton, the infamous bank robber, was asked why he robbed 
banks.
  By the way, here is a chart depicting a photo of Mr. Sutton from 
Life.com.
  How would Willie respond?
  He allegedly said he robbed banks because that is where the money is.
  If President Obama wants to propose credible deficit reduction 
proposals, he needs to go where the deficit dollars are.
  And what is the source of those deficits?
  Taking Willie Sutton's answer to heart, where do we look for those 
deficits?
  They are in the trillions of dollars in new spending that the 
American taxpayer has been burdened with by this administration.
  Non-defense discretionary spending, by itself, has grown by 24 
percent over the last couple of years.
  And that 24 percent figure does not include the stimulus bill 
spending.
  If stimulus spending is included, nondefense discretionary spending 
has grown by 84 percent.
  That is right, Madam President, 84 percent.
  How many typical taxpaying American families have grown their budgets 
by that much in the last couple of years?
  Let's take a look at the Gallup weekly survey of daily consumer 
spending as a comparison. I have a chart which shows the trend line in 
daily consumer spending.
  Over here, we can see from the chart consumer spending before the 
financial crisis of fall 2008 and the recession.
  It is running near or above $100 per day.
  Then what happens?
  Americans cut back their extra spending.
  It is right here on the rest of the chart.
  Is it any wonder Americans are telling us to cut our spending?
  They have cut spending. Why can't we in Washington do the same?
  When the President laid out his last two budgets, the loudest 
bipartisan applause came when he stressed fiscal discipline.
  That reaction should surprise no one. Though conservatives led the 
way, the American people understand that deficit reduction is not a 
partisan issue. If the promises of our Declaration of Independence and 
Constitution--promises of liberty and opportunity--are to mean anything 
for future generations, our country needs to take up deficit reduction 
now.
  Republicans are going to insist on meaningful deficit reduction as a 
course correction to our currently unsustainable fiscal path. As our 
Nation comes out of this painful slow-growth period--hopefully sooner 
rather than later--we must focus on cutting the deficit and the debt.
  As Republicans, we agree with the President on the priority of fiscal 
discipline.
  But deeds mean more than words.
  And twice, the President's budget, in spite of rhetorical nods to 
fiscal discipline, has gone in the direction of unpaid-for spending, 
new government programs and entitlements, and massive financial burdens 
on the next generation of American taxpayers.
  The numbers don't lie.
  The President and the Democratic leadership have dramatically 
expanded the deficit and piled onto the debt.
  Two years ago, Republicans and Democrats dramatically disagreed on 
the stimulus bill. Out of all the Republicans in the House and Senate, 
only three supported the stimulus bill conference report.
  Along with most of my Republican colleagues, I rejected this stimulus 
bill for several reasons.
  First was the size and the form of the stimulus. Most on our side 
understood that $1 trillion in deficit spending was an unacceptable 
burden on the people who would ultimately foot the bill.
  Second, we questioned the focus of the stimulus. We weren't keen on 
trying to grow the economy by priming the government pump. Spending $1 
trillion of taxpayer money on the academic theory that you have to 
spend money to make money was a gamble the American taxpayer could not 
afford. And last year, while the administration and its allies were out 
promoting recovery summer, citizens in Utah and around the country had 
long before figured out that the administration's stimulus bet was a 
big loser.
  Finally, what disturbed us most was the hidden fiscal burden built 
into the bill. Although sold as a $787 billion bill, the real cost of 
the stimulus was, in fact, much higher.
  I am going to use a chart to show this hidden cost of the stimulus 
bill. This chart was produced last year but will be updated when we 
receive the Congressional Budget Office baseline.
  According to the nonpartisan CBO, if popular new programs in the 
stimulus

[[Page 662]]

 bill are made permanent, the cost will be $3.3 trillion.
  To use Washington speak, the greatest threat of the new stimulus bill 
was that it raised the baseline.
  This is a nifty trick if you can pull it off.
  Its purpose is to open any future spending cuts, no matter how 
modest, to withering attack.
  Here is how it works.
  First, Democrats raise spending for some program--to borrow from 
George Costanza, we will call it The Human Fund.
  After Democrats take control of Congress and the White House, 
spending for The Human Fund goes up by 25 percent, from $1,000,000 to 
$1,250,000.
  Then, when the people reject this spending and send Republicans to 
roll it back, efforts to cut that spending by a meager 5 percent, from 
$1,250,000 to $1,187,500, leads all of the interest groups dependent on 
this federal money to scream that the sky is falling.
  An attack on The Human Fund is an attack on all that is decent in 
this country!
  Never mind that this program is still substantially better off than 
before the Democrats' massive increase in spending.
  All that we will hear is that Republicans are ruthlessly seeking to 
cut 5 percent from this program's budget.
  And so it goes.
  Our deficit and debt continue to grow as irresponsible and 
unaffordable increases in spending are baked into our budgetary cake.
  This strategy of raising the baseline is on full display in the 
stimulus bill and the threat that its programs--sold to the public as 
temporary--will become permanent.
  This chart details CBO's analysis of the stimulus.
  Let us move from left to right on the chart.
  The first column is the basic cost of the bill. If the making work 
pay refundable tax credit is extended, there is $571 billion in future 
deficits.
  It is in the second column.
  If the new entitlement spending in the stimulus is made permanent, 
then the cost of the bill more than doubles.
  It means almost $1 trillion in new hidden entitlement spending right 
here.
  In the fourth column, we have the appropriations spending.
  If those increases become permanent, then there is $276 billion in 
new nondefense discretionary appropriations in this bill.
  Finally, we have the rent on all this borrowed money. That is the 
interest expense. CBO tells us that the interest cost alone on the 
overt new spending and the hidden new spending from the stimulus totals 
$744 billion.
  Total it all up, and we get $3.3 trillion, not $787 billion.
  The total cost of the stimulus is $3.3 trillion.
  Our Nation can simply no longer afford this.
  These are CBO figures. They are not from a conservative think tank.
  There are a couple of simple ways for the stimulus bill supporters to 
correct this trajectory.
  If they want to keep the long-term cost of the stimulus down, they 
could agree to make all of the stimulus provisions temporary.
  Or they could agree to offset extensions of stimulus spending with 
other spending cuts.
  But our friends on the other side have done just the opposite. They 
have insisted on extending the policy in the stimulus bill without 
offsets in other areas of spending.
  You will recall then National Economic Council Director Larry 
Summers' three Ts tests for stimulus.
  To be effective, the stimulus needed to be timely, targeted, and 
temporary.
  It is failure on that third T, the temporary test, which has been 
very troubling. Two years into this failed economic experiment, and 
Democrats still refuse to agree that temporary stimulus proposals 
should remain temporary.
  The path forward is not going to be easy.
  While we do have a recent example of deficit reduction, it was not 
generated by this administration or its congressional allies. If you 
want to look at enacted legislation over the last decade, there is one 
significant spending reduction bill. It was the Deficit Reduction Act 
of 2005. It contained a modest amount of deficit reduction.
  The deficit reduction attained was $35 billion. And how did we 
achieve those savings? That bill was accomplished through 
reconciliation. The other side opposed it in lock step.
  In the end, only Republican votes carried that stand-alone deficit 
reduction measure.
  Yet now American taxpayers are being asked to believe that Democrats 
have found religion on deficits and debt.
  Our friends on the other side will, no doubt, say time out. We have 
produced a significant deficit reduction bill, they will say.
  They will point to last year's ObamaCare legislation. They will argue 
that this bill, which creates massive new entitlements, somehow saves 
money. Our Democratic friends will even cite a CBO score showing $230 
billion in deficit reduction from this bill.
  This assertion does not pass the laugh test.
  Anyone who looks beyond the basic score will see that ObamaCare is 
another huge deficit generator that will burden the American taxpayer 
for generations to come.
  House Budget Committee Chairman Paul Ryan released an analysis, 
derived from CBO data, that tells the full story of ObamaCare's deficit 
impact. Here is what Chairman Ryan said:

       Claims of deficit reduction exclude the $115 billion needed 
     to implement the law. The score double-counts $521 billion 
     from Social Security payroll taxes, CLASS Act premiums, and 
     Medicare cuts. It strips a costly doc-fix provision that was 
     included in initial score. It measures 10 years of revenues 
     to offset 6 years of new spending. There is no question that 
     the creation of a new trillion-dollar, open-ended entitlement 
     is a fiscal train wreck.

  Add it all up and the fiscal reality is that ObamaCare busts the 
budget by $701 billion.
  I ask unanimous consent that a copy of Chairman Ryan's analysis be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

Five Budget Reasons To Repeal the Democrats' Costly New Health Care Law

       1. Take away smoke and mirrors and law adds over $700 
     billion to deficits: Democrats' score excludes the $115 
     billion needed to implement the law; double-counts $521 
     billion from Social Security payroll taxes, CLASS Act 
     premiums, and Medicare cuts; and fails to account for the 
     costly ``doc-fix'' provision that Democrats stripped out of 
     the bill and passed separately.
       2. Massive tax increase minus slightly less massive 
     spending increase isn't ``fiscal responsibility'': According 
     to CBO, the Democrats'' law will ``reduce deficits'' by 
     increasing taxes by $770 billion, while ``only'' increasing 
     net spending by $540 billion. That's not the kind of 
     ``deficit reduction'' we're interested in. Furthermore, we 
     believe spending will actually be much higher.
       3. True cost 10-year cost of the law is closer to $2.6 
     trillion: The Democrats rigged their law to show 10 years of 
     revenues offsetting only 6 years of new spending. A true 10-
     year score of the new spending in the law puts the cost 
     closer to $2.6 trillion. Costs could run even higher if 
     employers dump their employees onto government exchanges and 
     Medicare ``savings'' fail to materialize.
       4. This law bends the cost curve up, not down: Exploding 
     health care costs are bankrupting families, companies, 
     states, and the federal government. The Democrats' new health 
     care law--with its maze of mandates, dictates, controls, tax 
     hikes and subsidies--will drive costs up even faster.
       CBO Director Doug Elmendorf says new law ``does not 
     substantially diminish'' pressure of rising health care costs 
     on the federal government.
       Medicare/Medicaid Chief Actuary Richard Foster says that 
     the law would result in ``higher health expenditures,'' 
     straining budget to the breaking point.
       5. Creation of a new open-ended entitlement isn't ``fiscal 
     responsibility'': The reality is that we cannot pay for the 
     health care entitlements we have, much less a new government 
     takeover of health care that adds trillions of dollars to our 
     existing liabilities, drives costs up even faster, and puts 
     the federal government in charge of even more health care 
     decision-making.
       The only way to control costs when the government is in 
     charge of the system is for bureaucrats to ration care.
       The path to greater choice for patients and lower costs for 
     all must begin with a full repeal of the Democrats' costly 
     new health care law.

[[Page 663]]



       The True Deficit Impact of the Democrats' Health Care Law

       Bottom line: The Democrats' health care law is a budget-
     buster. Claims of deficit reduction exclude the $115 billion 
     needed to implement the law. The score double-counts $521 
     billion from Social Security payroll taxes, CLASS Act 
     premiums, and Medicare cuts. It strips a costly doc-fix 
     provision that was included in initial score. It measures 10 
     years of revenues to offset 6 years of new spending. There is 
     no question that the creation of a new trillion-dollar, open-
     ended entitlement is a fiscal train wreck.
       Over $700 billion in red ink: To hide the true cost of 
     their $2.6 trillion health-care overhaul, the Democrats 
     loaded the overhaul with gimmicks and double-counting. Once 
     these gimmicks are accounted for, the law would add over $700 
     billion in red ink over the next decade, as health-care costs 
     send the debt spiraling out of control.
       Discretionary Spending: The CBO score did not include the 
     cost of setting up and administering the massive overhaul, 
     including the cost of hiring new health-care bureaucrats to 
     run the new spending programs, as well as thousands of IRS 
     agents to enforce the new mandates.
       Accounting for these discretionary appropriations would add 
     $115 billion to the bill's 10-year cost, all but wiping out 
     its alleged ``savings.''
       Double-Counting: The new law double-counts an estimated 
     $521 billion in alleged offsets:
       Social Security will receive an additional $53 billion in 
     higher payroll tax revenue as a result of the new law. 
     Instead of setting aside this revenue for promised Social 
     Security benefits, the law spends it on new subsidies.
       The Democrats' bill created the CLASS program, a brand new 
     long-term care entitlement. Over the first 10 years, program 
     would take in $70 billion in premiums, but instead of setting 
     money aside to pay for future benefits, the law spends the 
     premiums on new subsidies. Senate Budget Chairman Kent Conrad 
     called the CLASS Act: ``A Ponzi scheme [that] Bernie Madoff 
     would have been proud of.''
       Democrats claim they are extending solvency of Medicare by 
     cutting $398 billion from the program, but they 
     simultaneously claim that these savings will offset new 
     subsidy programs. CBO has made clear these savings cannot be 
     used twice.
       The Doc Fix: The Democrats' bill originally included the 
     ``doc fix'' that CBO estimated would add $208 billion to the 
     bill's score. Democrats removed this provision to lower the 
     bill's CBO score, but promised doctors that they would enact 
     the fix later, and did in fact pass a short-term prevention 
     of cuts to physician payments last year, adding to the 
     deficit.
       Add It Up: Take $115 billion in discretionary costs, plus 
     $521 billion in double-counting, plus $208 billion for a 
     long-term doc fix (minus the $143 billion of claimed 
     savings)--and the law would add $701 billion to the deficit 
     over the next 10 years.
       The Democrats' brand new open-ended health care entitlement 
     will--unless repealed--exacerbate the spiraling cost of 
     health care, explode our deficit and debt, and forever alter 
     the relationship between government and the American people.

  Mr. HATCH. This double counting of the Medicare cuts is a dangerous 
accounting gambit. Former Senator Gregg and I warned the Medicare 
trustees about it in a letter last year. I ask unanimous consent that a 
copy of that letter be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

   Hatch, Gregg Urge Medicare Trustees to Provide ``An Accurate and 
       Complete Assessment of New Health Law's Impact on Medicare

       Washington.--U.S. Senators Judd Gregg (R-New Hampshire), 
     Ranking Member of the Senate Budget Committee, and Orrin 
     Hatch (R-Utah), Ranking Member of the Senate Finance Health 
     Subcommittee, today urged the Medicare Trustees to release 
     supplemental information when they issue the 2010 Medicare 
     Trustees report ``so that the public can accurately assess 
     the impact of the new health care law on the Medicare 
     program.''
       ``Our nation stands on the precipice of fiscal ruin. Based 
     on past Trustees reports, we know Medicare is on the brink of 
     collapse,'' said Senator Hatch. ``It's in the best interest 
     of our country and our nation's seniors for the Trustees to 
     release a full and honest assessment of the fiscal impact of 
     the health care law on the viability of the Medicare program. 
     One of the most dishonest claims about this new law is its 
     magical ability to use Medicare money not only for Medicare, 
     but also for hundreds of billions in new entitlement 
     spending. That's an outrageous accounting gimmick and 
     everyone knows it.''
       ``We need a full and accurate picture concerning Medicare's 
     unfunded liabilities,'' said Senator Gregg. ``For example, 
     Medicare savings should not be used as a piggy bank to 
     finance new entitlement spending. The Democrats are counting 
     Medicare savings twice--once to partially offset the cost of 
     a new health care entitlement and argue that bill does not 
     increase the deficit, and then again to claim they have 
     improved Medicare's solvency. This is an undeniable budget 
     gimmick. As we continue to wrestle with the historic debt and 
     deficits facing our nation, Congress should receive a 
     projection of Medicare's condition based on the reality that 
     these savings can only be used once, despite the wishful 
     thinking of the majority.''
       In a letter to Treasury Secretary Tim Geithner, Labor 
     Secretary Hilda Solis, Health and Human Services Secretary 
     Kathleen Sebelius, and Social Security Commissioner Michael 
     Astrue, who serve as the Medicare Trustees, the Senators 
     wrote, ``It is our sincere hope that the Trustees Report will 
     give every American an accurate and complete assessment of 
     the fiscal challenges facing the Medicare program and the 
     federal government. Failure to do so would be a tremendous 
     disservice to the American people and our nation.''
       Specifically, the Senators requested:
       The Trustees produce a separate report, in conjunction with 
     the Center for Medicare and Medicaid Services (CMS) Actuary, 
     outlining Medicare's unfunded liabilities, taking into 
     account the real cost of fixing the broken Medicare physician 
     payment system. The Senators point out that the Trustees 
     report is based on current law, and while Democrats ignored 
     the physician payment issue during the health reform debate, 
     the Trustees should consider the long-term cost of Congress 
     continuing to delay these scheduled cuts in Medicare 
     reimbursement.
       The Trustees estimate the year when Medicare's Hospital 
     Insurance Trust Fund will be exhausted, reflecting the fact 
     that Medicare cuts and payroll tax increases in the new 
     health law are used to finance new spending outside of 
     Medicare and therefore cannot simultaneously be available to 
     pay for more future spending out of the Medicare program.
       The Medicare Trustees release an annual report on the 
     solvency and health of the Medicare program, which is 
     required by law to be submitted by April 1. The Trustees 
     decided to delay the report this year because the two health 
     care laws were enacted in late March.
       Below and attached is the full letter that Senators Gregg 
     and Hatch sent to the Medicare Trustees today:
     Hon. Timothy F. Geithner,
     Secretary of the Treasury, Department of Treasury, 
         Washington, DC.
     Hon. Hilda L. Solis,
     Secretary of Labor, Department of Labor, Washington, DC.
     Hon. Kathleen Sebelius,
     Secretary of Health and Human Services, Department of Health 
         and Human Services, Washington, DC.
     Hon. Michael J. Astrue,
     Commissioner of Social Security, Social Security 
         Administration, Washington, DC.
       Dear Honorable Trustees: As Congress and the American 
     people await the release of the 2010 Annual Report of the 
     Boards of Trustees of the Federal Hospital Insurance and 
     Federal Supplementary Medical Insurance Trust Funds (the 2010 
     Medicare Trustees Report), we are writing to request 
     supplementary information in an accompanying document so that 
     the public can accurately assess the impact of the new health 
     care law on the Medicare program.
       The 2009 Medicare Trustees Report laid out a grim 
     assessment of the financial status of the Medicare program. 
     Fueled by an aging population and rising health care costs, 
     Medicare expenditures, according to that report, would rise 
     from 3.2 percent of Gross Domestic Product (GDP) in 2008 to 
     11.4 percent of GDP in 2083. The 2009 Trustees Report 
     estimated that Medicare's unfunded liability is $38 trillion 
     over the next 75 years and that its Hospital Insurance (HI) 
     Trust Fund is expected to become insolvent in 2017.
       For Congress to effectively address the critical challenge 
     of Medicare solvency, it must have a complete and accurate 
     assessment of the program's fiscal position. We would like to 
     request that you provide to Congress, contemporaneous with 
     the release of the 2010 Medicare Trustees Report, a report 
     that addresses the two following issues.
       In recent years, the Trustees have noted an important 
     limitation regarding the report's projections for Medicare 
     Part B expenditures from the Supplementary Medical Insurance 
     (SMI) trust fund. While the Trustees' projections are based 
     on the assumption that current law will continue unchanged, 
     the law's scheduled reductions in Part B payments to 
     physicians under the Sustainable Growth Rate (SGR) provisions 
     have not occurred after 2002--the only time a decrease was 
     allowed to take effect; since 2003 Congress has consistently 
     enacted changes in law to defer the reductions. The 2009 
     Medicare Trustees Report warned that projections of Part B 
     expenditures under current law (which assumes the deferred 
     large reductions will eventually occur) thus are ``likely 
     understated and should be interpreted cautiously.''
       As a result of this divergence between the unrealistic 
     projections and the level of payments to physicians that 
     Congress actually enacts, the Centers for Medicare & Medicaid 
     Services (CMS) Actuary started producing a supplement to the 
     Trustees Report. The most recent supplemental memorandum,

[[Page 664]]

     Projected Medicare Part B Expenditures under Two Illustrative 
     Scenarios with Alternative Physician Payment Updates (May 12, 
     2009), contains estimates of a range of Medicare expenditures 
     based on scenarios where Congress prevents the scheduled 
     reductions in physician payments. Relying on the same two 
     illustrative scenarios, an analysis (by former Public Trustee 
     Thomas R. Saving) concluded that, over the next 75 years, 
     Medicare's unfunded liability could be as much as $1.9 
     trillion more than the Trustees projected in the 2009 report.
       We request that the CMS Actuary produce a report similar to 
     the May 12, 2009 supplement, and that, related to the 2010 
     Medicare Trustees Report, the Trustees provide projections 
     for Medicare's unfunded liability over a 75-year horizon 
     under the two alternative scenarios for physician payments 
     that will be included in the supplement produced by the CMS 
     Actuary.
       Our second request relates to an issue raised in the 
     memorandum released by the CMS Actuary on April 22, 2010, 
     titled Estimated Effects of the ``Patient Protection and 
     Affordable Care Act,'' as Amended, on the Year of Exhaustion 
     for the Part A Trust Fund, Part B Premiums, and Part A and 
     Part B Coinsurance Amounts. That memo stated the following 
     about the impact of health reform on the HI trust fund for 
     Medicare Part A:
       The combination of lower Part A costs and higher tax 
     revenues results in a lower Federal deficit based on budget 
     accounting rules. However, trust fund accounting considers 
     the same lower expenditures and additional revenues as 
     extending the exhaustion date of the HI trust fund. In 
     practice, the improved HI financing cannot be simultaneously 
     used to finance other Federal outlays (such as coverage 
     expansions under the PPACA) and to extend the trust fund, 
     despite the appearance of this result from the respective 
     accounting conventions.
       According to CMS, PPACA contained $575 billion in net 
     Medicare savings, including $63 billion in Medicare payroll 
     tax increases over fiscal years 2010-2019. However, as the 
     Congressional Budget Office (CBO) previously indicated in a 
     letter on December 23, 2009, these dollars cannot both offset 
     new spending under PPACA and then also extend the life of 
     Medicare's HI trust fund. CBO concluded:
       The key point is that savings to the HI trust fund under 
     PPACA would be received by the government only once, so they 
     cannot be set aside to pay for future Medicare spending and, 
     at the same time, pay for current spending on the other parts 
     of the legislation or on other programs . . . To describe the 
     full amount of HI trust fund savings as both improving the 
     government's ability to pay future Medicare benefits and 
     financing new spending outside of Medicare would essentially 
     double-count a large share of those savings and thus 
     overstate the improvement in the government's fiscal 
     position.
       We request that the Trustees provide a projection for the 
     date of exhaustion for Medicare's HI trust fund assuming that 
     all the estimated Medicare savings under PPACA are not set 
     aside to pay future Medicare benefits but instead are used to 
     finance new spending (outside of Medicare) in the new health 
     care law.
       We trust that you will provide a response to our request 
     concurrent with the release of the 2010 Medicare Trustees 
     Report. It is our sincere hope that the Trustees Report will 
     give every American an accurate and complete assessment of 
     the fiscal challenges facing the Medicare program and the 
     federal government. Failure to do so would be a tremendous 
     disservice to the American people and our nation.
       Sincerely,
     Judd Gregg,
       U.S. Senator.
     Orrin Hatch,
       U.S. Senator.

  Mr. HATCH. A clear pattern has emerged with respect to Democratic 
rhetoric on the budget. They speak loudly about deficit reduction, 
while continuing to write checks that this Nation cannot cash.
  Consider the last debt limit increase bill, which included the much 
ballyhooed statutory pay-go scheme. My friends on the other side speak 
of it frequently.
  But they have also been the most frequent violators of both the 
spirit and letter of statutory pay-go.
  The Senate Republican Policy Committee analyzed all of the spending 
offsets and other budget restraints rejected since statutory pay-go was 
adopted.
  I ask unanimous consent that a copy of this analysis be printed in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record as follows:

                          DEFICITS PILED ON BY SENATE DEMOCRATS SINCE STATUTORY PAYGO*
----------------------------------------------------------------------------------------------------------------
                                                   Deficit
                                                impact, 2010-                                      Link to CBO
             Bill                 Bill No.         2020 ($       Floor action         Date            score
                                                  billions)
----------------------------------------------------------------------------------------------------------------
Temporary extender bill......  H.R. 4691.....            10.3  Vote to kill      2-Mar........  http://bit.ly/
                                                                Bunning bill w/                  cJIN6B
                                                                offset.
                                                               Vote to pass
                                                                bill w/o offset.
Baucus Tax Extenders bill      H.R. 4213.....            98.6  Vote to keep      3-Mar........  http://bit.ly/
 (v1.0).                                                        emergency                        ahe9JI
                                                                designation.
 Reid HIRE Act...............  H.R. 2847.....          **45.9  Vote waive PAYGO  17-Mar.......  http://bit.ly/
                                                               Vote to pass                      b8Nlgq
                                                                bill w/o offset.
Temporary two-month extender   H.R. 4851.....            18.2  Vote to keep      14-Apr.......  http://bit.ly/
 bill.                                                          emergency                        cgrGHT
                                                                designation.
2010 Emergency Supplemental..  H.R. 4899.....            59.0  Vote to kill      27-May.......  http://bit.ly/
                                                                Coburn #1 w/                     cOITUC
                                                                offset.
                                                               Vote to kill
                                                                Coburn #2 w/
                                                                offset.
                                                               Vote to pass
                                                                bill w/o offset.
Dodd-Frank FinReg Reform       H.R. 4173.....             ***  Vote to waive     15-July......  http://bit.ly/
 Conf. Rpt.                                                     the Budget                       9Owy05
                                                                rules.
Continuing Extension Act (tax  H.R. 4213.....            33.9  Vote to pass the  21-July......  http://bit.ly/
 extenders shell).                                              bill w/o                         aVU7Ys
                                                                offsets.
Education/FMAP (in FAA         H.R. 1586.....            12.6  Vote to pass      05-Aug.......  http://bit.ly/
 reauth. shell).                                                bill w/o offset.                 bo4391
                              ----------------------------------------------------------------------------------
    Total....................  ..............           278.5
----------------------------------------------------------------------------------------------------------------
Notes:
*Statutory PAYGO was included in H.J. Res 45 (P.L. 111-139), which passed February 12, 2010. For more detail
  about PAYGO and how it operates, refer to the CRS summary: http://bit.ly/aOgf9m.
**The CBO score of the HIRE Act shows it lowers the deficit by $1 billion and $657 million, but CBO does not
  score the $47 billion in authorized transfers from the Highway Trust Fund to the General Fund even though they
  will be borrowed. The scores above reflect the combined effects of the bill as scored by CBO with these
  authorized transfers. See this document from the Budget Committee for more background: http://
budget.senate.gov/republican/pressarchive/2010-02-0BHwyExtPlan.pdf.
***CBO estimates that the act would increase projected deficits by more than $5 billion in at least one of the
  four consecutive 10-year periods starting in 2021 (beyond the budget window).

  Mr. HATCH. Total it up and you will find that the cost of Democrats 
end-running their own pay-go rule meant almost $280 billion in 
additional deficit spending.
  I think this point needs to be very clear.
  Senate Republican attempts to force our friends on the other side to 
abide by the letter or spirit of their own pay-go rule were rebuffed 
for almost all of last year. This was not some academic exercise. And 
now the American taxpayers are on the hook for roughly $280 billion, 
courtesy of Democrats purportedly committed to spending restraint.
  Still, we are heartened that Democrats are at least claiming a 
commitment to deficit reduction.
  Talking tough is a necessary--though not sufficient--step toward 
getting our fiscal house in order.
  Similarly, it is a positive development that the President has 
endorsed passage of the U.S.-Korea Free Trade Agreement. Maybe the 
administration is waking up to the importance of our pending trade 
agreements for our exports and the workers who make them.
  But the proof of his commitment to our exporters must go beyond the 
Korea FTA. We can no longer let our trade agreements with Panama and 
Colombia languish as we lose competitiveness and allow other countries 
to seize these markets for their workers.
  Talking about trade does not produce jobs. We need the President to 
take action and submit these agreements to Congress. And we need that 
action now. The U.S. worker cannot afford to wait.
  Passage of these trade agreements can boost our economy and our 
competitiveness without additional spending. They are important tools 
that we must put to work. If the President chooses this route, I 
believe he will find an important ally in Congress.
  I look forward to President Obama's proposals for prioritizing 
deficit reduction. There is no issue more critical to this Nation's 
future.

[[Page 665]]

  And I expect we will hear quite a bit about it in the State of the 
Union Address.
  The President can count on applause from our side of the aisle if he 
presses for reductions in out-of-control spending. But merely 
relabeling new spending as investments will not make our deficits go 
away, and it will do nothing to tackle our escalating debt.
  The President must give serious attention to the legitimate arguments 
and concerns of conservative citizens if he wants to achieve anything 
more than a pleasant sounding rhetorical flourish.
  President Obama did inherit a serious budget deficit. And our friends 
on the other side will, once again, applaud that line. They will cheer 
the assertion that they merely inherited deficits. They will spin the 
convenient tale that Republicans alone bequeathed the deficit to 
President Obama. But that is certainly not the case. And the record is 
clear. A Democratic Congress and a Republican President created this 
deficit from bipartisan policies they jointly developed.
  To those Democrats who claim Republicans have no right to discuss 
deficits, they need look no further than their own actions. Take a look 
at the fiscal effects of the stimulus bill they crafted 2 years ago. 
Take a comprehensive look at the real deficit impact of ObamaCare.
  Take an honest look at the appropriations bills that piled on double-
digit increases in spending.
  American families don't have the luxury of 84 percent or 24 percent 
increases in their spending. They have made their priorities and 
restrained their spending.
  If American families can prioritize, deleverage, and live within 
their means, I hope the President will push his allies in Washington to 
do the same.
  All of us in Congress await the arrival of President Obama's third 
budget.
  The American people are demanding that he make deficit reduction a 
priority. And they are asking Congress to approach this subject in an 
intellectually honest fashion.
  We need to acknowledge that when it comes to the budget, the road to 
fiscal ruin has been paved with good intentions. In the name of fixing 
the economy, the Democrats' stimulus bill has imposed both short-term 
and long-term costs on American taxpayers, jeopardizing economic growth 
and, with it, liberty and opportunity. That damage has been expanded 
with un-offset extensions of what we were told were temporary 
provisions.
  As we start writing a budget, let's do it with all the fiscal cards 
on the table. Let's remove the political blinders and deal with the 
fiscal facts. And that means being realistic about expiring tax relief, 
its merits, its economic growth effect, and its political popularity.
  This is not a problem that we can tax our way out of. Getting our 
fiscal house in order is going to require hard decisions on spending. 
We need to put our shoulders to the wheel. We owe it to the people who 
sent us here.
  There is an old saying that applies here. I am not the first person, 
nor will I be the last, to reference it in the context of our fiscal 
troubles. The saying is: When you find yourself in a hole, stop 
digging. We need to use our shovels to fill this fiscal hole, not dig 
it deeper.
  I look forward to this debate on spending. It will not be an easy 
one. But the American people have demanded that Congress take up this 
cause, and I fully intend to.
  Ultimately, I am confident that we will achieve meaningful deficit 
reduction. Yet I go into this debate with my eyes open.
  President Reagan, in the foreign policy arena, reminded us to trust, 
but verify.
  As we await the President's State of the Union speech, Republicans 
trust that Democrats will make a nod toward deficit reduction, but we 
need to verify whether they are serious about getting this problem 
under control.
  Democrats do not have a great track record when it comes to cutting 
spending. But hope springs eternal.
  Madam President, I suggest the absence of a quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CARDIN. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

                          ____________________