[Congressional Record (Bound Edition), Volume 157 (2011), Part 8]
[Senate]
[Pages 11341-11344]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       BALANCED BUDGET AMENDMENT

  Mr. JOHANNS. Madam President, I rise today to speak to an issue that 
I believe has all the potential in the world to define the future of 
this great country. It is an issue with which all of us who are 
participating in this colloquy are very familiar, and that is a 
balanced budget. All of us are former Governors of the States from 
which we come.
  In my State, the State of Nebraska, our Nebraska Constitution 
requires a balanced budget. It is not unusual. I believe 49 out of 50 
States have this requirement in their constitution. It is not theater; 
it is the way we do things at the State level.
  In addition to that provision, however, our State constitution also 
says the total amount of money the State of Nebraska can borrow is 
$100,000. What does that mean? We must balance the budget on an annual 
basis, and we cannot go out to the debt market and burden our children 
and grandchildren by fulfilling promises that, quite honestly, we have 
no idea how we pay for. We cannot do that.
  Does that sound familiar? That is what the Federal Government does 
every single year, and the Federal Government has been doing it for 
decades. In Nebraska we are forced to prioritize and live within our 
means. We have a very simple, straightforward philosophy. We do not 
promise something we cannot pay for, and we do not buy something we 
cannot pay for.
  Is that unusual? Is that radical? Every working family in America 
understands that, and they live by that simple concept: the simple 
concept that they should not buy what they cannot pay for. If they do, 
it gets them in trouble. Sadly, the Federal Government does not think 
that applies. It thinks it is kind of a radical notion to apply that to 
what happens in Washington.
  Let's look at the results of this kind of policy in my State of 
Nebraska. The unemployment rate in Nebraska today is 4.1 percent. 
During one of the most difficult times since the Great Depression, the 
unemployment rate in Nebraska never exceeded 5 percent. As I have said 
before on this floor--let me state that a different way. That means 
about 96 percent of Nebraskans have work.
  Our State believes in the philosophy of less government. I have said 
many times: Government does not create the jobs, the private sector 
creates the jobs. It is small businesses and businesses willing to take 
the risks that will get us out of the tough times we are in now.
  When I was Governor, Nebraska went through some very difficult times. 
I was Governor on 9/11. I was Governor when the dot-com bubble burst. I 
did not have the option of walking into my State of the State Address 
and standing there and saying: Folks, these are

[[Page 11342]]

tough times. We are kind of divided out here. We will not be passing a 
budget. Had I said that, I would have been looking for another State to 
live in. I would have been laughed out of the Governor's office.
  There were no easy decisions, but there were necessary and important 
decisions to be made. Nebraskan pragmatism would go a long way in 
Washington, but my State is not unique. My State is not unique in terms 
of this balanced budget requirement. In fact, I have other Governors 
with me today.
  I would like to start out by recognizing Senator Lamar Alexander of 
the State of Tennessee. When Senator Alexander became Governor, I know 
he had a lot of priorities, but he created an environment in which job 
creators could thrive. He created that environment with the spending 
requirements of his constitution. I would like him to tell us how he 
did it, how he took his State forward even though he had to balance his 
budget.
  Mr. ALEXANDER. I thank Governor Johanns. It is terrific to be on the 
Senate floor with other former Governors. When we were doing the health 
care bill last year, I said everyone who voted for it ought to be 
sentenced to serve as Governor for 8 years and actually try to 
implement it. But let me try to answer the question briefly so we can 
hear from the other Governors.
  I became Governor 30 years ago, in the early 1980s. Inflation was 20 
percent. It is hard to imagine, in the early days of the Reagan 
administration, they had driven up interest rates to 12 percent to try 
to bring inflation down. We had terrible times. Of course, we still had 
to balance our budget. We had to live within our means. We had to have 
the amount of money coming in equal to the amount coming out.
  Let me tell one story of the difference that has made in our State 
and how it could make a difference in the Federal Government. The other 
day, in the Environmental and Public Works Committee, the Tennessee 
chief highway engineer was testifying. He was there when I was 
Governor. He is still there. One of the Senators, the chairman, 
suggested perhaps some flexible Federal financing would be a good thing 
for Tennessee; in other words, loaning some money to the State of 
Tennessee to build roads.
  The State engineer said: Madam Chairman, with all respect, we don't 
want to borrow any Federal money. The State of Tennessee has zero road 
debt.
  That about brought the hearing to a halt because several Senators had 
not ever heard of such a thing.
  He said: Yes, that is correct. We have zero road debt. We use all of 
our gas tax money to build roads, none of it to pay interest.
  That means, I say to the Senator from Nebraska, when we have a tough 
time like we did when I became Governor, as when he was Governor, as we 
do in the country today, if our interest rates are low or we pay no 
interest, we can use that money to get through tough times. A lot of 
the businesses and the families today who have less debt are making 
their way through these tough times more easily.
  On the other hand, the Federal Government, according to the 
President's budget, by the year 2020, would be spending more money on 
interest on the Federal debt than it would on our national defense. 
Interest on the Federal debt would be $931 billion by 2021.
  What if that money could be put back in our pockets through tax cuts 
or used to help send kids to college or build roads in the State or 
energy research to lower the cost of gasoline? One way, I would say to 
the Senator from Nebraska, that balancing the budget helps create jobs 
is if we keep our interest payments down, we keep our taxes down, we 
can spend our money wisely on things that count.
  Mr. JOHANNS. Senator Alexander raises such a valid point. In the 
State of Nebraska we don't have any road debt either. If we wanted to 
pave a mile of highway we had to have the money in the bank or it did 
not get done. The other advantage of that is when the economy started 
to lift, we did not have to pay back all that money we had borrowed. We 
were ready to take off. So I would have to imagine in Tennessee, like 
Nebraska, our economic recovery was just much easier to achieve.
  I had the pleasure of serving as Governor of Nebraska when Senator 
Hoeven was Governor of North Dakota. The State of North Dakota is often 
recognized as one of the best managed States in the country. It has its 
fiscal house in order. It runs a surplus with some of the lowest 
unemployment rates of any State in the country. Yet they suffered 
through some of the same problems we had after the dot-com collapse.
  Could the Senator talk to us a little bit about how the balanced 
budget provisions in his constitution required him and the legislators 
to manage the State?
  Mr. HOEVEN. I thank Senator Johanns. It is an honor to be here with 
him, and also with the good Senator from Tennessee, Lamar Alexander. It 
is great to be here with them as well as Senator Risch from Idaho. We 
have a common shared experience as Governors. It is wonderful to draw 
on that.
  I also have to mention that the Presiding Officer in the Senate 
today, Senator Shaheen, is a former Governor as well. So we have that 
common, shared experience, actually, here today on both sides of the 
aisle. It is an honor and it is a pleasure to be here with you and talk 
about this matter that is so very important, particularly as we face 
the need to do something on the debt ceiling. This issue of dealing 
with a balanced budget is paramount for our entire country and your 
lead-in is exactly right. We served together as Governors. As a matter 
of fact, the truth is, I would call the Senator--because he was elected 
Governor before I was--for advice and ask him about some of the things 
he was working on in Nebraska. Our States share many things in common; 
one the Senator mentioned, a low unemployment rate. The unemployment 
rate in our State is 3.3 percent. Again, I attribute that to the 
ability of building a probusiness, progrowth, projobs environment that 
stimulates private investments, stimulates jobs. The Senator mentioned 
so very accurately that jobs are created by the private sector, not by 
government. We have to create an environment that stimulates and 
encourages and helps create a forum for that private investment. That 
is how we create jobs and get this economy going.
  On one side, we have to have a growing economy, which we don't have 
at the national level right now, and on the other side we have to live 
within our means. We have to control our spending, and the Federal 
Government has a responsibility to control its spending just as the 
States do, just as businesses do, just as families do. We have to not 
only balance this budget, we have to live within our means on an 
ongoing basis. We have 49 of the 50 States with either a constitutional 
or a statutory requirement that they balance their budget every year. 
Every single Governor with us today had to balance their budget every 
single year. It was recently reported that 46 States are already on 
track to make sure their budget is balanced by the end of their fiscal 
year. The Federal Government needs to do the same thing.
  Look at our situation right now. The Federal Government takes in $2.2 
trillion in revenues. We take in $2.2 trillion in revenues, but we 
spend $3.7 trillion. That is a $1.5-plus trillion deficit every year, 
and that is rolling up to a debt that is now closing in on $14.5 
trillion. We have to address this. This is not something we can hand 
off to future generations. So our message to the administration is, you 
are making it worse. We have to start living within our means. We 
cannot keep spending and then borrowing and then raising taxes and 
expect to have an economy that grows and a government that lives within 
its means, and that is exactly why we are here today talking about the 
need for this balanced budget amendment.
  If one thinks about it, the balanced budget amendment gets everyone 
involved both now and for the future because it has to be passed by 
both Houses of Congress with a two-thirds majority. That has to be done 
on a bipartisan basis and then it goes out to the States and three-
fourths of the

[[Page 11343]]

States have to ratify it for it to become part of the Constitution. 
That gets everybody involved in doing exactly what we need to do; that 
is, getting on top of this deficit and this debt, both now and for 
future generations.
  Again, I wish to thank the good Senator from Nebraska for holding 
this colloquy and for inviting me to be part of it with my fellow 
Governors. I appreciate it very much.
  Mr. JOHANNS. Let me thank Senator Hoeven. I noticed today we are also 
joined by another former Governor. In fact, we were both elected to the 
Senate at the same time so we are both part of the same class.
  Senator Risch, at one point in his career, served as Governor of the 
State of Idaho. He had financial restrictions just as we did in terms 
of a balanced budget. I ask the Senator, how was he able to deal with 
important priorities while balancing the budget and bringing the 
legislative process along in accomplishing that? Could the Senator talk 
to us a little bit about that today?
  Mr. RISCH. I thank Senator Johanns very much. I am honored to be here 
with the other former Governors. There are a handful of us on each side 
who have had the honor and privilege of serving their States as the 
chief executive, so it is a real honor to be here, and I bring that 
experience with me. I think every one of us brings that experience with 
us. I not only bring that experience, but I did almost three decades in 
the Idaho State Senate, balancing the budget and, indeed, I was in the 
leadership, having to do what the leadership does here, as far as 
bringing the two ends together, because we have a balanced budget 
requirement in the State of Idaho, as virtually every other State does. 
Does that create some angst when one is the chief executive or when one 
is in the legislative process trying to balance the budget? Of course 
it does. I am sure the Presiding Officer wound up with the same thing 
in her great State as she tried to balance the budget because no matter 
how much money one has, it is never enough. As Senator Johanns pointed 
out, it is a matter of priority. This is not rocket science.
  What the States do and, indeed, what businesses do and, indeed, what 
families do around the kitchen table, either formally or informally, is 
anticipate how much money is going to come in over the year, sometimes 
over the month, sometimes over the week. They anticipate how much money 
is going to come in and then they say: We have priorities. What is our 
first priority? Of course, in a home, we have to be able to eat, we 
have to have the utilities paid and a roof over our head, so those 
become very important. To a government, obviously, if it is a State 
government, education is the largest expenditure for virtually 
everyone. For the Federal Government, obviously, the highest priority 
is national defense. But we make a list. Then what we do is we allocate 
the money we have to a list. When we are done, nobody ever stands and 
says: That went very well. We have enough money. We have everything 
funded. We are able to do everything we want to do.
  No, absolutely not. Indeed, around here, in this city, this 
government is spending $3.8 trillion. I can tell you, there isn't a day 
that goes by where we don't get hit up with somebody saying: It is not 
enough. Our agency doesn't have enough money. Why we can't even--blank. 
Fill in whatever you want, whatever agency it is. Everybody tells you 
they don't have enough money.
  Yes, that is right. Because a balanced budget requirement 
acknowledges a plain, simple fact of life; that is, there are not 
enough resources to do everything we want to do. Indeed, a lot of times 
there isn't even enough money to do what we need to do, but what we 
have to do is we have to do the best we can with what we have. Without 
a balanced budget amendment, it becomes the opposite of that--we keep 
spending.
  People say to me: Well, Jim, you have been in public service all your 
adult life. Has anything in Washington, DC, surprised you? I said: Yes, 
but only one thing. The stuff that goes on here doesn't surprise me at 
all, except the cavalier attitude this city has and, indeed, this 
institution has for the value of money. It astounds me that in this 
institution they don't stop spending money when they hit the end of the 
budget or they don't stop spending money when they hit the end of the 
resources. They stop spending money when they run out of time. That 
seems to be the only sideboard on how much money is spent. If we look 
around--and people will criticize us on this--and say: You foolish 
Republicans, what are you talking about? A balanced budget amendment, 
that is dumb. You know what I say to them? Look at the States. Look 
around at the States. There are two, maybe three States that are having 
very difficult financial situations, and it is because they either 
don't have a balanced budget amendment or they have done some 
skulduggery to get around the balanced budget requirement they have. 
But every other State has its financial house in order. Has it been 
painful? Of course, it has been painful. It is painful to everyone when 
they don't have enough money, including American families, but that is 
simply the way it is.
  One of the problems we are having is the basic foundation of the 
difference between Republicans and Democrats. People who say there is 
no difference between Republicans and Democrats ought to come and spend 
the day here. They would find that philosophically we are hardwired 
very differently. Similar to two brands of computers trying to talk to 
each other, we are hardwired differently.
  Republicans believe this Nation was founded with the idea we would 
have a limited central government. It was founded by people who, 
indeed, feared a central government. By the way, their fear, as we now 
see every day, is very well founded. We believe in a limited 
government. We believe in individual responsibility. We believe in the 
responsibility of the States. It is hard to find people in this town 
who actually believe the States are sovereign, that it was the States 
that created the Federal Government and kept a leash on it and said you 
can only have the powers we are specifically putting into this 
Constitution. Now the courts over the years have expanded that 
dramatically, but nonetheless, the vision the Founding Fathers had, the 
American people had when they put together the country that created the 
most successful, the wealthiest, the culture that enjoyed the best 
quality of life anyone on the face of this planet has ever enjoyed 
before, the Founding Fathers said: Look, we are going to create a 
government for the individual, to give the individual the ability to 
prosper, to give the individual opportunity.
  That is what they said. They didn't sit around the table and say: You 
know what we need is a nanny State. We need to create a government that 
is going to take care of every American from the time they are born 
until the time they die just as in Europe.
  In Europe, the government pays for your birth. In Europe, the 
government pays for your funeral and, indeed, it pays for a whole lot 
of everything in between including every dime you spend after you 
retire. That is not what America was founded to do. They did not sit 
around and say: How can we take care of the whole society? They said: 
How can we defend this country? How can we make sure no enemies come 
into this country? How can we make sure people have the opportunity to 
succeed? Yes, some will fail. Yes, some will succeed. Yes, we are going 
to have poor people, and, yes, we are going to have rich people because 
that is what a free society is all about, but everybody is going to 
have the same opportunity. Everybody who is born into this country or 
becomes a naturalized citizen in this country is going to have the 
opportunity to succeed in a greater fashion than anyone on the face of 
this planet has ever succeeded before, and they are going to do it 
without government interference.
  My goodness. How far we have come from those days and not in a good 
way. They couldn't conceive they needed a balanced budget amendment 
because the numbers we are talking about they never heard of. If a guy 
sitting around the table said: By the way, do you know the country is 
going to be over $1 trillion in debt someday, they would

[[Page 11344]]

have said: What is $1 trillion? How many zeros is that? They couldn't 
even conceive of that, so they didn't put that in the Constitution. But 
this isn't difficult to do. It is how much comes in and how much comes 
out and they need to equalize each other.
  I will be the first to admit our two parties don't understand each 
other. As I said, we are hardwired differently, and I have a lot of 
good friends on the other side of the aisle. We have good 
conversations. They don't understand how I can possibly think we could 
have a balanced budget, and I guess I don't understand how they think 
we can spend ourselves into prosperity. We are, indeed, hardwired 
differently than each other.
  I watched one of the leaders the other day come out onto the floor. 
He was carrying on about how bad the balanced budget amendment was. He 
said it would be an admission of the failure of this institution to be 
able to do its job. It would be abdicating our ability to do our job. 
Look around. We are $14.3 trillion in debt. Do you think the American 
people think we are doing our job, when we are at $14.3 trillion in 
debt and now debating adding another $2.4 trillion to that? If a person 
comes and spends a little bit of time here, they will understand this 
institution cannot budget and do so responsibly. Given the opportunity, 
it will spend and spend and spend and the only way this can be changed 
is if we have a balanced budget provision in the Constitution just as 
virtually every State in America has. We are going upside down at a 
rate of $4 billion to $5 billion a day. We are borrowing new money, $4 
billion to $5 billion a day. That is about 12 hours of the entire 
annual budget for the State of Idaho. This can't go on. The way to fix 
it is with a balanced budget requirement that puts a new rule in place, 
and we need rules, we need sideboards when it comes to spending money.
  I wish to thank the Senator for providing us with this opportunity. 
Those of us who have actually lived in the real world where we could 
not print money, we could not borrow the kind of money we are talking 
about here, where we had to make responsible decisions--it is time this 
government did that, and the only way it is going to do that, 
regardless of flowery speeches given during campaigns--oh, send me to 
Washington; I will take care of this; I will see we balance the budget; 
I won't overspend--they come here and do it. The only way this can be 
done is to balance the budget. Without a balanced budget amendment to 
the Constitution, we can't do this.
  The American people have to do this. We can vote to ask the American 
people: Do you think we should have a balanced budget amendment to the 
U.S. Constitution? Let's find out. Let's find out. There can't be 
anything wrong with giving the American people the ability to do this. 
It takes three-fourths of the States to ratify this. Let's give them 
the opportunity. Let's have the debate. Let's pass this and give it to 
the States and see if they want to do it.
  Thank you very much. I appreciate the opportunity.
  Mr. JOHANNS. Let me wrap up this colloquy this morning by thanking 
each one of my colleagues for their comments.
  Governors are practical people. We have to be. We have no choice. If 
jobs are going to be created in our States, we must lead that effort--
not by jawboning and indicting the business community but by creating 
the atmosphere that creates those jobs. If we are going to have a 
balanced budget, we must lead that effort at the State level. Every 
Governor who has had an opportunity to speak this morning in this 
colloquy has made that point. At the end of the day, when our 
legislative sessions were over, we had to be able to tell the people of 
our great States that we passed the budget; that the budget was, in 
fact, balanced; and, for some of us, that we did not borrow any money 
whatsoever to get that job done. We could learn something in Washington 
from that.
  This is not a radical idea. All the rhetoric we have heard about what 
a radical, crazy idea this is--well, how can it be so radical if 49 out 
of 50 States have decided this is the right course and the right 
direction for their State governments? I can't imagine the American 
people want anything less for their Federal Government. And, as Senator 
Risch has just pointed out, why would we not give the American people 
the opportunity to cast their vote on how best to manage their 
government--their government?
  With that, I yield the floor, and I note the absence of a quorum.
  The PRESIDING OFFICER (Mr. Tester). The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. REED. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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