[Congressional Record (Bound Edition), Volume 158 (2012), Part 12]
[House]
[Pages 16007-16013]
[From the U.S. Government Publishing Office, www.gpo.gov]




                            THE FISCAL CLIFF

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 5, 2011, the gentleman from Virginia (Mr. Scott) is recognized 
for 60

[[Page 16008]]

minutes as the designee of the minority leader.
  Mr. SCOTT of Virginia. Madam Speaker, on behalf of the Congressional 
Black Caucus, we would like to discuss the fiscal cliff and our 
position on the ongoing negotiations.
  We didn't get here, Madam Speaker, by accident. I was elected in 
1992. In the 1993 budget, we addressed fiscal responsibility by passing 
the Clinton budget. It was very controversial. In fact, it only passed 
by one vote of the House, and the Vice President had to vote in the 
Senate to break the tie. That budget put us on a trajectory toward 
fiscal responsibility.
  That was interrupted by a controversy in 1995, when the Republicans, 
using the votes on that budget, picked up a majority in the House and 
tried to dismantle that budget. President Clinton allowed the 
government to get shut down rather than dismantle the budget. That 
budget stayed into effect until 2001.
  In 2001, Chairman Greenspan was answering questions like: Are we 
paying off the national debt too quickly, and should we pay off the 
national debt? The projections were that, by 2008, the entire national 
debt held by the public would be paid off with no money owed to China, 
Japan, or Saudi Arabia. We would have paid off all of those debts. All 
the money would have been back in the trust funds by 2013.
  That's where we were beginning in 2001, but the Republicans talked 
people into thinking that you could pass tax cuts without paying for 
them, massive tax cuts in 2001 and 2003. There were two wars not paid 
for and a prescription drug benefit not paid for. All of that surplus 
evaporated, and now we find ourselves deeply in debt. Rather than 
paying off the debt, we have more than doubled the debt.
  Now it's obvious we have to do something about it, and the 
Congressional Black Caucus is willing to do its part within certain 
parameters. This is the Congressional Black Caucus position on going 
forward:
  Excessive partisanship and a lack of willingness to compromise has 
led us to this moment where tough choices must be made to prevent our 
Nation from going over the fiscal cliff, but one thing is clear: The 
path to fiscal sustainability must not be made on the backs of our 
Nation's most vulnerable communities.
  As President Obama and congressional leaders continue to negotiate 
ways to avoid the fiscal cliff, the Congressional Black Caucus will 
adhere to the following principles in considering its support of any 
agreement:
  First, we must protect our social safety net. Social Security should 
be completely off the negotiating table since it does not contribute to 
the deficit. Additionally, the Congressional Black Caucus will 
specifically oppose any plan that changes eligibility for Medicare.
  Investments in job training, education, health care, transportation, 
and infrastructure should not be cut to pay for the extension of any of 
the Bush-era tax cuts. These vital government investments are critical 
to our Nation's short-term recovery and long-term economic prosperity.
  The Simpson-Bowles Commission set a goal of $4 trillion in deficit 
reduction over the next decade. Considering that goal, $1.5 trillion in 
cuts have already been agreed to through the spending caps in the 
Budget Control Act of 2011. Non-defense discretionary spending, as a 
percentage of GDP, is at a 50-year low. Additional savings through 
reductions in military operations in Iraq and Afghanistan should also 
be recognized. So we've gone a long way in recognizing the $4 trillion 
goal.
  The wealthiest Americans disproportionately benefited from the Bush-
era tax cuts and the Federal Government's 2008 bailout of some of the 
largest firms on Wall Street. Revenue increases and allowing the Bush-
era tax cuts to expire for the wealthiest Americans must be part of any 
agreement.
  The Congressional Black Caucus supports extending the middle class 
Bush-era tax cuts, but any extension must be paid for in ways that are 
consistent with these principles. We should not agree to the extension 
of any tax cuts without knowing how we will pay for them. We cannot 
allow an extension of tax cuts now, only to discover that they'll be 
paid for by cutting Social Security, Medicare, Medicaid, and other 
critical social safety net programs later.
  The Affordable Care Act should not be on the negotiating table. The 
program does not add to the debt and must be protected and fully 
implemented as planned. Millions of Americans are already benefiting 
from health care reform, and millions of Americans stand to gain access 
to affordable health care insurance in 2014.
  Emergency unemployment insurance must be extended. Every dollar spent 
on unemployment insurance generates $1.55 in economic activity. 
Unemployment benefits are the most effective fiscal policy to stimulate 
the economy and put people back to work. Our economy is slowly 
recovering from the deepest recession since the Great Depression, and 2 
million workers would be stripped of their emergency unemployment 
compensation if no action is taken by the end of the year.
  Earlier this year, the Congressional Black Caucus offered an 
effective alternative budget that addresses the sequester and fully 
pays for an extension of Bush-era middle class tax cuts without cutting 
Social Security, Medicare, Medicaid, and the social safety net, while 
also ensuring that we invest in our children, our communities, and our 
economy.
  We can get this done if we do this consistent with the Congressional 
Black Caucus principles. The vulnerable will not be hurt. We're close, 
but we cannot agree to any kind of scheme that puts us in a situation 
where we extend tax cuts now and then later find that we're going to 
pay for them on the backs of the most vulnerable in our community.
  I now yield such time as she may consume to the gentlelady from 
Wisconsin, a very active member of the Budget Committee, Ms. Moore.
  Ms. MOORE. Thank you so much, Mr. Scott.
  I would start out by asking you to yield to a question, Mr. Scott, 
because we heard prior to our discussion here at the Congressional 
Black Caucus hour, we heard the majority leader and the minority whip 
discussing spending. I just wanted some clarification.
  When we provide tax cuts to anyone, but especially to the top 2 
percent, is that spending?
  Mr. SCOTT of Virginia. When you're talking about the budget, there 
are two sides of the ledger. If you spend more, you should tax more. If 
you have less in taxes, you have to have less in spending. That's how 
you balance the budget.
  One of the problems we've had for the last few years is people think 
you can have a tax cut and don't have to cut anything. In the 
discussion of how much tax extension you can afford, that discussion is 
almost unrelated to the spending cuts. If you want to extend more tax 
cuts, then you have to cut more spending. People talk about it like 
they're unrelated. They say you can cut it off at $500,000, rather than 
$250,000. If you extend more tax cuts, you have to cut almost 10 
percent across the board in non-defense discretionary spending to make 
up for the lost revenue.
  At some point, people should conform their statements to fundamental 
principles of arithmetic. This is what we've gotten away from. This is 
what the Congressional Black Caucus budget does. It names how you can 
come up with the revenue. It names specifically revenue: the Buffett 
rule, the surcharge on millionaires, investment income like regular 
income, and naming specific corporate loopholes that can be closed. We 
show how you can easily come up with the amount of money that's left in 
the $4 trillion after the trillion and a half in cuts and after the war 
savings and after the expiration of the upper income Bush-era tax cuts. 
We can fill the gap.
  If you don't want to do it that way, then name the spending cuts. 
This is where the trouble is. We've heard all this about reducing the 
size of government with unspecified cuts. That sounds good, until you 
start specifying.

[[Page 16009]]



                              {time}  1230

  The last time Republicans had a budget that reduced the size of the 
government, they cut almost $300 million out of Embassy security. 
That's what they mean by reducing the size of government. Usually what 
they mean is Social Security and Medicare, but whatever they mean, name 
it. We don't want to be in a position in which we've extended tax cuts 
and then come back next year and say, Oh, now we're broke, and we've 
got to cut Social Security and Medicare. If that's what you're going to 
do with a tax cut, then let's consider that as we decide if we want 
that tax cut or not. I think most people would say, if your goal is 
cutting Social Security and Medicare, we don't need a tax cut that bad. 
As a matter of fact, that's how the scheme works. The only way you can 
cut Social Security and Medicare is to get people to go for the tax 
cuts now and then come back and say you're so broke and we need so much 
money that the only place you can get it is from Social Security and 
Medicare.
  So let's get this up front. Let's do it all at once. We know what tax 
cuts are going to be extended, and we know how they're going to pay for 
them. We're not going to get tricked later on by people coming up 
saying that we've got to cut Social Security and Medicare because we 
extended the tax cuts. This is one of the problems we get into. They 
will not name the programs that are going to get cut. When they talk 
about corporate loopholes, they don't say what they are.
  Ms. MOORE. Mr. Scott, just for my understanding and for my 
constituents to appreciate the scope of this problem, if we were to cut 
WIC and Head Start and Meals on Wheels for elders and the low-income 
heating, we are made to believe that if we were to put all of these 
kinds of programs on the table that we could maintain the Bush-era tax 
cuts, that we could maintain most of the unequal treatment of dividends 
and corporate gains, and that we would be just fine, that we could find 
$4 trillion in Pell Grants and Head Start moneys.
  Am I missing something here?
  Mr. SCOTT of Virginia. If you look at the budget and if you take out 
Social Security, Medicare, Medicaid, and defense and if you just look 
at what's called the nondefense discretionary budget, that's about--I'd 
say in round figures--$400 billion. If you're trying to get $4 trillion 
in cuts in 10 years, that's $400 billion a year. You would have to 
eliminate government. There would be no Embassy security, no FBI 
agents, no food inspection, no Federal prisons, no Head Start, no 
education, no FEMA, no transportation. I mean, nothing, nothing.
  Ms. MOORE. Except for tax cuts.
  Mr. SCOTT of Virginia. You would have to eliminate everything in 
order to fund a total extension of the tax cuts. Now, obviously, that's 
not going to happen.
  Obviously, if you extend the tax cuts without offsetting it with 
other revenues, you've got to go into Social Security and Medicare. 
When they talk about reducing the size of government, that's why they 
can't tell you what they're going to cut, because they can't cut that 
much. When they say they're going to close the corporate loopholes, 
they can't name them because the corporate loopholes don't add up to 
enough. When you start talking about Head Start and the legal aid and 
all those, you're talking about hundreds of millions of dollars. We're 
trying to get to trillions.
  Ms. MOORE. Mr. Scott, I thank you for that background because I just 
wanted to set the record straight.
  On the hype that the Grand Old Party is leading us to believe, which 
is that, number one, extending the Bush-era tax cuts is not spending. 
It is exactly spending, and that is on the faulty belief that our 
spending on safety net programs is driving our debt. Social Security 
does not drive the debt.
  I think, Mr. Scott, you have really led us into a clear understanding 
of Grover Norquist's claim that they really want to do away with 
government. They want to shrink government down to a size so small that 
they could drown it in a bathtub. They don't want to recognize the 
important role of government. They don't want clean air, clean water, 
food inspection. They want laissez-faire and for-corporate activity.
  Now, our debts and deficits have been driven by undeniable, obvious 
factors. We've had a deep and ongoing recession based on an unregulated 
Wall Street. We've had expensive and drawn-out wars--the longest war in 
the history of this country that we're still in the midst of. Then 
there are the unpaid-for Bush-era tax cuts that have benefited 
primarily the wealthiest Americans, and of course there is an unpaid-
for entitlement program. While we do appreciate the prescription drug 
program for seniors, Mr. Scott, the greatest beneficiaries of that 
program are the pharmaceutical companies because they get undue profit 
from not negotiating on the critical mass that this population provides 
them, the savings from that program.
  So, if they want to talk about entitlement reform, I think a good 
place to start would be in negotiating for prescription drugs provided 
through Medicare and also in the recapturing of billions of dollars of 
overpayments from the insurance premiums under Medicare Advantage. The 
advantage goes to those insurance companies.
  Our debts and our deficits have not been driven by children attending 
Head Start. Our debts and deficits have not been driven by seniors 
receiving Meals on Wheels. Our debts and deficits have not been driven 
by students participating in the TRIO program or receiving Pell Grants, 
yet we continue to hear the Grand Old Party say that we've got to put 
these programs on the chopping block so that we can continue tax breaks 
for the top 2 percent of Americans.
  Now, members of the Congressional Black Caucus, believe it or not, do 
not agree 100 percent on how to solve the so-called ``fiscal cliff'' 
situation, but there is 100 percent agreement among Congressional Black 
Caucus leaders that we do not want an austerity cliff, which will lead 
to increased poverty and exacerbate the hardship for low and middle 
class families. The wealthiest individuals and corporations should have 
to pay their fair share of taxes.
  As a member of the Budget Committee and as the Democratic chair of 
the Congressional Caucus for Women's Issues, I have a lot of thoughts 
on the fiscal cliff negotiations. First of all, we must include a 
robust extension of Federal unemployment benefits for workers.
  Mr. Scott, has there ever been a time when the unemployment rate--7.2 
percent--has ever been this high and, on a bipartisan basis, this 
Congress has not provided extended unemployment benefits for workers?
  Mr. SCOTT of Virginia. It is generally the practice that we would 
extend emergency unemployment compensation for longer than normal, 
which is every time the rate gets high and when it's an emergency, so 
it's not offset. That is the usual situation.
  The problem with this recession is that a disproportionately high 
portion of the unemployed or long-term unemployed--the people who have 
been unemployed for a long time--are experiencing even insult to injury 
because a lot of employers are discriminating against people who do not 
have jobs. If you apply and don't have a job, they will not consider 
your application. If you have a job, then they will consider you. So, 
if you've been without a job for a long time and are still trying to 
get a job, it's even harder for you to get a job. Now, those people 
have traditionally worked. They're hardworking Americans who want a 
job, are looking for a job. Unfortunately, the economy is such that 
you've got three or four people looking for every job that's out there. 
So, whatever happens, a lot of people are going to be left out.

                              {time}  1240

  And meanwhile, the question is: What happens? If you provide 
unemployment compensation for them, one of the things that happens is 
they spend that money into the economy as soon as they get it.
  Ms. MOORE. Absolutely.
  Mr. SCOTT of Virginia. So it is one of the most effective things. If 
you put $1 into unemployment compensation,

[[Page 16010]]

economic activity is about $1.55. If you give a $1 tax cut on 
dividends, the economic activity is about 15 cents because the people 
getting that benefit will just spend what they ordinarily spend. They 
may pay off a credit card, they may save some money, but they're not 
going to spend the money. You want the money in the hands of people who 
will actually spend it if you want the economy stimulated.
  Ms. MOORE. Thank you for that, Mr. Scott. That is a major point, that 
unemployment compensation extension would provide the greatest 
stimulative impact, not only for those people who are desperately in 
need of it, but for our economy as a whole.
  We often hear so much about how much people love the little children, 
and I guess there's only one way to show it during these discussions. 
The Congressional Black Caucus agrees that we need to maintain some of 
the provisions that are expiring under the American Recovery and 
Reinvestment Act, the so-called stimulus, and that's the child tax 
credit and the earned income tax credit.
  The austerity, Mr. Scott, that we're trying to avoid is that children 
bear the burden of this recession. They are often hidden faces. They 
don't vote. They don't contribute to campaigns. But we thought, the 
Congressional Black Caucus thought, it was really important to put on 
the table the need to protect children.
  Again, we don't think Social Security should be on the table in these 
fiscal cliff discussions. It's not the driver of the deficits. And 
further down the line, we think it's important to not mess with the age 
or switch, change CPI, or any other cuts that would affect 
beneficiaries.
  Mr. SCOTT of Virginia. People talk about increasing the age of Social 
Security or the cost-of-living increase. The first question is whether 
or not you're going to cut Social Security. And then if you decide to 
cut Social Security, there are different ways of doing it, some more 
painful than others. But the first question is: Are you cutting Social 
Security? And part of that question is why. If none of the tax cuts get 
extended, at this point you've got too much money. You've got more 
money than you need on the table. So the only reason you're even 
discussing a cut in Social Security is because you want to extend the 
tax cuts.
  Now, I think most people when they're faced with the choice, do you 
want Social Security to be a piggy bank, every time we're running short 
in the budget you're going to cut a little Social Security or Medicare 
or Medicaid, are you going to make that a little piggy bank every time 
you have a budget problem, and if you're going to extend tax cuts, are 
you going to pay for them out of Social Security, I think most people 
would want us to leave Social Security and Medicare and Medicaid alone. 
Leave it alone. And if you've got enough money for the tax cuts, fine. 
But do not extend tax cuts and think you're going to pay for it and 
people are going to like you paying for it out of Social Security and 
Medicare.
  And that's really the choice we have, because the entire discussion 
about Medicare is only necessitated by the fact that people are trying 
to extend these tax cuts. And if you extend the tax cuts, then you have 
to pay for it. And we're talking arithmetic. If you extend trillions of 
dollars in tax cuts, the only place you can reasonably get it, Social 
Security and Medicare, unless you're going to raise some other taxes to 
offset it.
  The Congressional Black Caucus has taken the position that we don't 
want any tax cuts that are paid for if you have to cut Social Security, 
Medicare, and Medicaid, the social safety net, or investments in our 
future like education and research and infrastructure. We don't need 
tax cuts that badly. We need those investments more than we need tax 
cuts.
  So when you start talking about the different ways of cutting Social 
Security, we need to make sure that it's in the context, that we're 
talking about cutting Social Security in order to preserve the tax 
cuts.
  Ms. MOORE. Let me ask you something about preserving the tax cuts. 
The President campaigned for a couple of years, but particularly in the 
last year, on cutting tax cuts for income over $250,000. So am I to 
understand, Mr. Scott, that that means that millionaires and 
billionaires will still be getting a tax cut were they to agree to this 
framework?
  Mr. SCOTT of Virginia. They would get a tax cut on their income up to 
$250,000. Their income over $250,000, they would not enjoy the Bush-era 
tax cuts. They would be paying the same taxes they were paying when the 
stock market was--during the Clinton administration, when the stock 
market almost quadrupled. The Dow Jones Industrial Average almost 
quadrupled. Under the lower tax rates under the Bush administration, 
the Dow Jones Industrial Average was incredibly worse at the end of his 
8 years than it was in the beginning. Quadrupling under Clinton; worse 
under Bush than it was in the beginning. Of course, job creation, 
record under the Clinton administration when you had the higher rate; 
under the Bush administration, the only measure you're looking at it, 
is it or is it not the worst since the Great Depression.
  Obviously, those who are paying the high rate actually have more of a 
financial interest in the stock market, because the little bit of tax 
increase we're talking about, they will more than offset that by the 
stock market going up like it did under the Clinton administration. If 
you look at the taxes they saved under Bush, if they could have gotten 
the returns in the stock market like they did under Clinton, they would 
have gotten 10 to 20 times more returns in the stock market than they 
paid in little taxes.
  Ms. MOORE. So we have heard some people panicking, saying, boy, 
between me and my husband, our household, we make $252,000 a year. What 
do we say to someone, a family earning $252,000 a year, that you're 
going to pay the higher tax rate on $2,000 of your income?
  Mr. SCOTT of Virginia. You're exactly right. It probably would not 
result in any change in the withholding because of that little bit of 
money, and they would have all of the tax cuts up to the first 
$250,000, and they would pay a slightly additional tax on the 
additional $2,000.
  One of the things that we need to point out is that with the stagnant 
economy, most workers haven't gotten a cost-of-living increase in a 
long time. If we can improve the economy, if we had a little more money 
and could create jobs and improve the economy such that employers think 
that people might actually walk off the job and go get another job, 
they are more likely to get a cost-of-living increase. That cost-of-
living increase is more than the additional taxes that we're talking 
about in most cases.
  Ms. MOORE. Thank you, Mr. Scott.
  I have many, many more questions for you about what the options are, 
about what we can do. And I know that the Congressional Black Caucus 
doesn't agree on everything, but it seems to me that the Congressional 
Black Caucus is very concerned about the math adding up.
  Mr. SCOTT of Virginia. That's exactly the problem. When you start 
talking about reducing the size of government with unspecified cuts or 
revenue increases, not rate increases but revenue increases, whatever 
that means, without specifying, we don't even know whether it is 
arithmetically possible. But if it is arithmetically possible, what we 
suspect is that it is going into things like the deduction you get on 
health care. You don't have to pay--if you get health care insurance, 
you don't have to pay income tax on that. The mortgage deduction, 
charitable deductions, the kinds of things that we probably wouldn't 
want to cut in order to fund some tax cuts, but the Congressional Black 
Caucus did talk about deferral of overseas corporate profits. If you 
eliminate that exemption, that's about half a trillion. A 5 percent 
surcharge on millionaires, that's about half a trillion. The financial 
speculation tax, when you buy stocks and trade stocks and bonds, you 
pay a little one-quarter of 1 percent charge on that. Now, before the 
discount brokers, people would be paying

[[Page 16011]]

1 or 2 percent, not just a little quarter of a percent. So that is 
certainly something that could be done. Limit the deductibility of 
corporate debt interest. That's about three-quarters of a trillion. 
Treating investment income like regular income, that's almost a 
trillion.
  I mean, there are a lot of things that we can do to add up to get to 
the little bit of money we need left. Negotiating prices on 
pharmaceuticals under Medicare.
  Ms. MOORE. That's exactly where I want to go. People are very nervous 
about this discussion, and the Republicans continue to say that we need 
to put Medicare on the table. And I know that during the campaign they 
talked about creating a voucher, premium support under Medicare, which 
would have cost seniors an average of $6,000 more.

                              {time}  1250

  Mr. SCOTT of Virginia. About $500 a month more for health care than 
they're paying now. That was the plan.
  Ms. MOORE. And how does that differ from possibilities that are 
available under the Affordable Care Act?
  Under the Affordable Care Act, which it's really ironic, because if 
you want to derive some savings under Medicare, and I have no reason to 
believe that Republicans don't want to do that, why would they continue 
to be talking about, Governors all over the country talking about, not 
putting the exchanges together in their States, still some sort of 
agenda to repeal Medicare?
  What savings can be derived out of Medicare from full implementation 
of the Affordable Care Act, so-called ObamaCare?
  Mr. SCOTT of Virginia. Well, one of the things that ObamaCare did was 
to provide, for those on Medicare, you get your annual checkups with no 
copay and cancer screening, no copays and deductibles. We're closing 
the doughnut hole.
  Under the Romney plan, because they're paying providers more, your 
copay part of that provider fee is more, so your copays and deductible 
would be more. That's for people over 55. People already on Medicare 
would pay more under the alternative than they're paying today.
  If you're under 55, you're at your $500 a month, every month, trying 
to make your health care, because the thing is that if Medicare is 
saving money, and the health care costs do not go down, then somebody's 
got to pay the difference. Adding insult to injury to that, you have 
corporate profits, dividends and commissions and everything else being 
siphoned off. So you not only have to pay the health care costs; you 
have to pay enough to cover the corporate profits. And so that's where 
senior citizens would be paying $500 a month, $6,000 a year more.
  Ms. MOORE. So, Mr. Scott, let me see if I've got this straight. Under 
the Affordable Care Act, we are asking that, instead of having seniors 
pay more, you know, find themselves in the doughnut hole, that we ask 
pharmaceutical companies to ask to negotiate drug prices. Over 10 
years, that might be $156 billion, $157 billion.
  Mr. SCOTT of Virginia. There's a provision in the prescriptive drug 
benefit that passed about a decade ago that prohibits HHS from 
negotiating drug prices with pharmaceuticals. Now, the VA can negotiate 
prices; Medicaid can negotiate prices. But somehow, somebody, I don't 
know who, nobody's taking credit for it, it just kind of ended up in 
there, prohibits HHS from negotiating drug prices. So when a company 
says this is what we want, it is illegal for HHS to point out that 
you're charging everybody less, you charge in Canada less--how about 
giving us a little savings--that's illegal. Whatever they want, that's 
what they get.
  Ms. MOORE. That would be a great reform under entitlement. Another 
entitlement reform I would just like for you to address that's in the 
Affordable Care Act would be this so-called Medicare Advantage program. 
Medicare Advantage, I mean, who doesn't want an advantage?
  But the actual delivery of the service, where, to whom does the 
advantage inure?
  Mr. SCOTT of Virginia. Well, the Medicare Advantage gives you 
slightly enhanced benefits under Medicare, and it was provided by 
Medicare. And what the private sector says is: we could provide those 
same services for a lower cost; and if you let us get in at 95 percent 
of what you're paying, everybody wins, because we're saving money. 
That's a phantom saving, but that was the original deal.
  By the time--in the prescriptive drug benefit, we're paying about 115 
percent more than the average. And all we're doing is saying, well, 
let's just pay the average.
  The insurance companies do have an advantage in their costs because 
there are ways of attracting a healthier clientele, so their costs 
would be lower, not because of efficiency, but because they skewed a 
better, healthier clientele and that's how they save money.
  But what we did was reduced their profit margin to the point where 
they have to be at least as efficient as Medicare, not getting a bonus, 
which didn't help anybody.
  Ms. MOORE. So I see, Mr. Scott, that Representative Sheila Jackson 
Lee has joined us, and so I just want to close out by asking this last 
question, just to wrap this up. So when the President talks about 
putting $480 billion of cuts on the table for Medicare, without knowing 
all of those details, a lot of that depends on not reducing benefits to 
the elderly, but to make sure that pharmaceutical companies and 
insurance companies and hospitals deliver services in a more efficient 
way, that people--that the delivery--that we change the way health care 
is delivered in a way that is efficient, more humane, cost effective 
and deliver the same level of quality and benefits to the elderly. Is 
that right?
  Mr. SCOTT of Virginia. And that is exactly what we did. Much has been 
made of the $716 billion that was saved in Medicare. The corporate 
subsidies was part of it, efficiencies were part of it, but not a dime 
in benefits was adversely affected. In doing that, we also extended the 
solvency. Medicare goes broke, was going broke, in 4 years. Now it's 12 
years.
  Under the alternative plan, during the campaign, it would be back to 
4 years. So seniors would be paying--seniors on Medicare now would be 
paying more. Seniors, younger people when they get to Medicare would 
pay a lot more, and it goes broke quicker. That was what we were 
fighting. And the President was reelected, and so Medicare will not be 
attacked.
  But, again, when you talk about additional Medicare cuts, we're just 
not cutting in the abstract. Those cuts are necessary because people 
want to extend the Bush-era tax cuts. If you do not extend the tax 
cuts, you do not have to discuss any cuts in Medicare.
  These savings are designed to help pay for tax cuts; and people need 
to make the choice, recognize the choice. Do you want to cut Medicare 
in order to preserve some taxcuts? I think a lot of people would say 
leave Medicare alone.
  Ms. MOORE. Leave my Medicare alone.
  Mr. SCOTT of Virginia. I yield such time as she may consume to the 
gentlelady from Texas, Sheila Jackson Lee.
  Ms. JACKSON LEE of Texas. It's a delight just to be with you, not a 
delight on this discussion that we're having. I want to thank the 
gentlelady from Wisconsin for her leadership and membership on the 
Budget Committee, and certainly the gentleman for Virginia on his 
leadership on the Budget Committee, and delighted to be a member of the 
Congressional Black Caucus and have a reasoned discussion.
  And just to pick up from where Mr. Scott was saying and just 
reinforce it, Medicare is solvent. Let me just turn. Medicare is 
solvent. Medicare is solvent. Medicare is solvent and it is strong. It 
is solvent to 2024.
  Social Security, which is not even an issue, has nothing to do with 
this deficit. It is a trust fund, but more importantly, it is solvent 
until 2037. Let me repeat myself that Medicare is solvent. Social 
Security is solvent until 2037. That is really a lifetime.
  The gentleman has made a very good point that I would like to pursue 
in discussing fiscal deadlines. I have washed

[[Page 16012]]

my mouth out with soap and will no longer yield to terminology that has 
been used that is falsifying where we are.
  Let me first go over, and I'm going to mix some apples and oranges a 
little bit of what the President has offered us. I know we've heard it, 
but let me reinforce the fact. And my numbers are going to be not 
precise, but I'm going to say that 1.2, 1.1, over 1 trillion in tax 
cuts. And then a war dividend, a peace dividend of about 1 trillion--I 
want to say war, but war savings.
  I have signed on to expedite the return of our heroes from 
Afghanistan, move into the diplomatic process, bring our soldiers home. 
And $50 billion in infrastructure that creates jobs.
  For those of you who find sinkholes for your cars, overcrowded on 
various freeways and highways, this is to aid in doing what we have not 
done over many decades, $50 billion.

                              {time}  1300

  And then, of course, the mentioned Medicare. And Mr. Scott has 
indicated that is the President's attempt to be the reasonable man, 
even though on November 6, 2012, America spoke soundly and loudly that 
the idea of protecting the safety net of Medicare, Medicaid, and Social 
Security is vital. I add to that unemployment insurance. In terms of 
those who have been looking for jobs, that is crucial. We have a lot of 
young people who have started out with a job but then may not have had 
it. Please know that unemployment insurance is that--it's insurance, 
not a handout. It's a hand up.
  Do you realize that all of this would be wiped out with the proposal 
that our friends insist on keeping, when economists will tell you 
several things. First of all, there is no documentation that in fact if 
you keep the cuts, you'll create jobs. There just isn't any basis for 
that. First of all, we take care of 97 percent of small businesses with 
income under $250,000. Go up and down the streets of America on Small 
Business Day and ask these small businesses what their income is, not 
what they take in and pay employees, et cetera. They will not pay any 
taxes on income of $250,000. And then, if you are hardworking, an 
$80,000 salaried person, two workers in the family, $40,000 and 
$40,000; that's $80,000. If you make $250,000. If you make $15 billion 
in salary or in income, you will get a tax cut of $250,000. Is that not 
the reasonable man and woman standard? Is that not reasonable?
  Let me tell you why that's reasonable. Because as I said, most 
economists will tell you that, first of all, cutting spending is not 
the answer in a recession as relates to the deficit. And so we're not 
insensitive to the deficit. We want to have a reasoned response to the 
deficit. The crisis is to ensure that middle America and low-income 
Americans and young people with their start-off jobs making a certain 
amount of money do not have an enormous tax increase as they go into 
2013.
  Be very sure now, this whole thing about going downhill doesn't 
exist, because it's something of a slide. All of these things don't 
happen right at 2013. We have the time to be reasonable to deal with 
the tax cuts to save people from having increases, meaning those 
earning $250,000 and below. And for the blessed and well-to-do, let me 
just say this is not any punitive measure in suggesting that we don't 
have the respect for people's wealth and the well-to-do. What we're 
saying is where there's mutual benefit, there's a mutual burden. And I 
haven't heard a cry out from anybody to say that they would not welcome 
that balance.
  So then we have the opportunity, even though the President's put on 
the table, as the gentleman from Virginia said, $480 billion. This 
whole boogie man about entitlement reform is such a straw man. It's 
just something to throw out to the American people. The people that are 
on Medicare and Medicaid and Social Security are entitled ne'er-do-
wells. That is not true. The people who get Medicare and Medicaid, 
Social Security, even unemployment insurance, are people who have 
worked. They have worked. They have earned this.
  Now, there are many ways that we can look at these elements going 
forward. But the idea that we would throw this on the altar as a 
sacrifice and cloud people's minds and tell them that they are in fact 
going to be the life or the answer of whether or not our good friends 
join us on the other side of the aisle and do this reasonable act of 
cutting the taxes of 100 percent of Americans and eliminating the Bush 
tax cuts for the 1 and 2 percent.
  Let me just tell you, for those who think that they don't mind the 
cliff, I'm not sure who's been saying that. And I respect them for it. 
I said I wasn't going to say that. But you're talking about increasing 
taxes. You're talking about causing the loss of jobs, increasing taxes 
about $3,000 on the average family. You're talking about increasing 
unemployment from 7.9 percent to about 9.1 percent. This is what we're 
playing with. But let me just give you something else.
  The tax cuts that we have been paying for already over a 10-year 
period, the extension would cost $2.4 trillion. And if anybody is 
serious about cutting the deficit, how nonsensical and what sense does 
that make to continue these cuts? If they could document for me how 
these create jobs, then maybe we would be able to respond to it.
  Does anybody realize and recognize that Hurricane Sandy came through 
and that one of the mayors of one of the largest cities was just here 
this week asking for an enormous infusion of dollars, of which we are 
merciful and recognize the role of the Federal Government? Why are we 
stalling on the simple process of eliminating the Bush tax cuts of 2 
percent of the individuals who have been particularly silent because 
they recognize benefit and burden? And for our corporations--and I have 
the greatest respect for capitalism--presently flush with cash, let me 
tell you what the instability is. The corporations, the businesses are 
saying, Tell us what the deal is, then we'll plan. We'll know what to 
do, and so we will be able to stabilize. I hope they'll invest the 
money they already have out into the market because there's still 
incentives for creating jobs. Maybe if we pass the American Jobs Act, 
we'd be able to do that.
  Let me just finish on this point to my dear friend. I want to remind 
everybody that tomorrow is World AIDS Day; and I want to remind people 
that over its lifetime and up to the end of 2005, 38.6 million people 
worldwide were living with AIDS and more than 25 million people have 
died of AIDS since 1981. And so a lot of people say, Oh, that's behind 
us. What is she talking about, HIV/AIDS? Well, I know when I go into 
the Thomas Street Clinic in Houston, Texas, that is not the case. And I 
congratulate them for what they have done. But there are approximately 
1 million, 1.2 million positive individuals that live in the United 
States and 56,000 new infections every year.
  Why am I saying that? Because when we think of discretionary funding, 
it's a nebulous term. What does it mean? Mr. Reid rightly asked my good 
friends on the other side of the aisle, What spending cuts are you 
talking about? It was the intervention of the Federal Government with 
the Ryan White Treatment Act and the research regarding HIV/AIDS that 
have helped people like those who are hemophiliacs and others in the 
large population. That means that everybody gets it. It's not a stigma. 
Everybody is possibly susceptible to it. Where would we be without that 
intervention of the Federal Government?
  So in the shadow of honoring tomorrow and those who have lost their 
lives in this terrible epidemic, to be able to salute and thank those 
who've done the research and improved the quality of life of those who 
are now living with HIV and AIDS and saying to those millions who lost 
their lives that we will not forget, that's what this debate is about. 
It is about rental income for poor people. By the way, those poor 
people are working people. It is about supplemental nutrition dollars 
for women and children. I would not call them the deadbeats of life. 
Those who speak on the floor about national security and border 
security, do you realize that we'd be cutting $823 million from customs 
and border protection? These

[[Page 16013]]

are the roles and responsibilities of the Federal Government.
  And so rather than take a frivolous perspective on this, rather than 
tell people that you can't do anything before 2013, rather than suggest 
that entitlements are laid upon the table, on the altar as a sacrifice, 
just tell the American people the truth. Let's just tell them the 
truth. Entitlements are not the issue. And if so, cool heads can sit 
down and engage the American people and tell us how many seniors in 
nursing homes do we want to throw out in the street. What options do 
they have? Maybe we'll begin to talk about home care. That's okay. But 
you don't talk about home care overnight.
  So you have to be deliberative. And then, who wants to make a fuss 
about Medicare when it's solvent until 2024? Again, abusing the 
information given to the American people. Who wants to make a fuss 
about Social Security when it's solvent and it's about you earned it?
  So to Mr. Scott, my call today is to thank you for giving us this 
opportunity. As I speak to my constituents, I indicate that we're just 
immersed in these kinds of discussions and I'm hoping and, as I said, 
I'm optimistic and believe that cool heads will come together. We'll be 
back next week. We'll be talking to our constituents over the next 
couple of days.

                              {time}  1310

  I'm looking at a sheet that has a number of revenue options that I'm 
going to be studying. That means that I am not in any way taking the 
serious work of the deficit for granted. But I do want to put a 
firewall around hysteria and put the hysteria over here, and get to 
work with eliminating the tax cuts for the top 2 percent, give 
everybody a $250,000 income tax break, and then, in a thoughtful 
manner, look at a number of ways and join with the President on saying 
it's valuable to do something about infrastructure, it's valuable to 
count in the war savings and to bring our troops home--heroes--with 
honor. I passed an amendment to do that, to honor every returning 
soldier that comes home.
  So I thank the gentleman from Virginia for his service, but also for 
the work that you've been doing on this issue. I hope I'm not too 
animated, but let me end on a very quiet note. I am calm, and I believe 
that we can be deliberative and responsible in our thinking, and I look 
forward to that occurring.
  Mr. SCOTT of Virginia. Mr. Speaker, just in closing, the gentlelady 
pointed out that bad things happen if we go over the cliff. Bad things 
are going to happen if we get serious about deficit reduction. The only 
way you can deal with deficit reduction is to raise somebody's taxes or 
to cut somebody's spending. It's going to be unpleasant. Until you 
recognize that arithmetic reality, we're not going to make any 
progress.
  You're not going to be popular doing deficit reductions, but we have 
choices to make. We can do this without cutting Social Security, 
Medicare, or Medicaid, the social safety net, or investments in our 
future. We have a list of ways of doing it, with specifics. Now, we're 
willing to compromise, of course, but you can't compromise by reducing 
the size of government with unspecified cuts. Until you specify them, 
you can't have a discussion. You can't have unspecified revenues that 
don't involve rate increases when we don't know what you're talking 
about. We can't compromise on that because there is no proposal to 
compromise.
  We need specifics. We cannot allow people to try to get past a scheme 
where you extend the tax cuts at a huge price and then come back next 
year and try to pay for them and notice that you're so broke you have 
to cut Social Security and Medicare. If that's your plan, let's get it 
all up front: we're going to cut Social Security and Medicare in order 
to provide for some tax cuts. I think most people would say, no, leave 
Social Security and Medicare and Medicaid alone. If you've got some 
money left over from tax cuts, fine, but we do not want Social 
Security, Medicare, and Medicaid to be cut in order to provide for tax 
cuts.
  When you start talking about, well, increase the age or reduce the 
COLA, those are just ways of reducing benefits. So we need to make that 
threshold statement that we're not going to allow Social Security and 
Medicare and Medicaid to be used to pay for any of these tax cuts, and 
we will not allow a scheme to take place where we all agree on some tax 
cuts first, and then find out that because of the size of the tax cuts 
we have to cut Social Security and Medicare. Let's figure this all out 
at once. It can be done. There are some tough choices that have to be 
made, and the Congressional Black Caucus has shown how those choices 
can be made, with specifics, in their various documents.
  Mr. Speaker, I appreciate the opportunity to have this moment to 
discuss the Congressional Black Caucus position on the fiscal cliff, 
and I yield back the balance of my time.

                          ____________________