S3148 CONGRESSIONAL RECORD — SENATE February 27, 1995 he has ever done to the Communist con- tolerant—which is what all true conserv- from Arkansas and Chairman of the Senate spiracy here or abroad.’’ He cosponsored the atives should aspire to be. Foreign Relations Committee. He was Spe- censure resolution that was the beginning of He was one of the early champions of the cial Assistant to the late Senator Carl Hay- the end of McCarthy. wise investment of American aid to rebuild den, then the President of the U.S. Senate. In 1960 President Kennedy wanted Ful- and strengthen a war-ravaged Europe. Later, Mr. Pettit went to Vietnam as a foreign bright as his Secretary of State, but was dis- he was one of the early opponents of the ex- correspondent and made many distinguished suaded from asking him to serve. Much later travagant support of unpopular and repres- radio broadcasts in 1965 and 1966. He was one Fulbright said he was ‘‘not temprementally sive dictatorships abroad—enriching Asian of the very first Americans to predict that asuited’’ to administer ‘‘somebody else’s pol- countries merely because they professed to the United States could not prevail in that icy—or one I disagreed with.’’ Another rea- be anti-communist. He fought against the tragic undertaking. He wrote a long and pre- son is that it would have removed him from transfer of hundreds of billions of U.S. dol- scient letter to me from Saigon that was a the Senate that he loved. lars to the Far East, enriching Asian nations substantial influence upon my long opposi- He opposed the disastrous Bay of Pigs in- merely because they professed to be anti- tion to America’s adventure in Indochina. vasion of Cuba and tried vainly to talk Presi- communist. He was a reluctant witness to Later he wrote the book, ‘‘The Experts’’—the dent Kennedy out of proceeding with it. America’s rapid decline from being the big- definitive chronicle of the Vietnam War. He As Chairman of the Senate Foreign Rela- gest creditor nation on earth to become the has had a consistent vision of our proper role tions Committee, Senator Fulbright led the biggest debtor nation—what he called ‘‘a in foreign affairs and a continuing concern floor-fight for the Gulf of Tonkin Resolution crippled giant.’’ for U.S. involvement in Asia and the Middle because President Johnson asked him to, Usually courteous to the point of court- East. promising him that its effects would be lim- liness—especially to the humble—he was He believes, incidentally, that since more ited and not open-ended. This began John- sometimes professorial, even condescending than fifteen years have elapsed since the end son’s tragic adventure in Indochina. Soon to his peers—especially the pompous. Only of hostilities, it is time for diplomatic, cul- after, Fulbright realized he had been lied to with difficulty did he suffer fools, He had tural and commercial relations to be re-es- about what really happened in the Gulf of contempt for politicians and their ‘‘commu- tablished. I agree. Tonkin, he had the courage and the manhood nications’’ experts—with government by Any courtesies extended to him will be ap- to confess that he had been wrong in sup- poll. ‘‘Their purpose seems to consist largely preciated. porting it. He then convened the so-called, in discovering what people want and feel and Sincerely, Fulbright Hearings of the Senate Foreign dislike,’’ he said, ‘‘and then associating J.W. FULBRIGHT. Relations Committee, summoning Dean themselves with those feelings. * * * This is Rusk and Robert McNamara and all the the opposite of leadership, it is followship, f great war-hawks to educate the American elevated to a science, for the purpose of self- public via television. He began his coura- advancement. Even formal policy speeches CONCLUSION OF MORNING geous seven-year crusade against the Viet- are determined by the polls. The policy BUSINESS nam War. statements that emerge have little to do The PRESIDING OFFICER. Morning When a colleague asked him if the Senate with the national interest.’’ business is now closed. had the power to enact certain legislation, He lived through most of a terrible and Fulbright replied, ‘‘We have the power to do turbulent century. In the vastness of time, f any dawn fool thing we want, and we always his nine decades of life were but a narrow seem to do it.’’ valley between the peaks of two eternities. BALANCED BUDGET AMENDMENT Apropos of Vietnam and our tragic experi- And yet, what a bountiful valley it was. TO THE CONSTITUTION Sir Christopher Wren’s epitaph in Lon- ence there, he liked to quote Kipling: The PRESIDING OFFICER. The The end of the fight is a tombstone white don—in the St. Paul’s Cathedral he de- signed—is Si monentum requiris Chair does apologize to the Senator with the name of the late deceased, from West Virginia. Under the previous And the epitaph drear: ‘‘A fool lies here circumspice—‘‘If you would seek his monu- who tried to hustle the East’’. ment, look around you.’’ order, the Senate was to resume con- The same epitaph is appropriate for Bill sideration of House Joint Resolution 1 He was one of the first to warn that Ameri- Fulbright. cans were being taxed to pay for being propa- at 12:30. We will now do that. The clerk The United Nations. will report. gandized by what he called ‘‘The Pentagon The Fulbright scholarships. Propaganda Machine.’’ The anti-war years during the maelstrom The legislative clerk read as follows: He had the wisdom to see that in all polit- of Vietnam. A joint resolution (H.J. Res. 1) proposing a ical systems there is a tendency for public The scores of legislative accomplishments. balanced budget amendment to the Constitu- servants to metamorphose into public mas- The wise world-view he sustained tion of the United States. ters, surfeited with unchecked power and thoroughout his long lifetime. privilege and increasingly overpaid to The Senate resumed consideration of ‘‘Our future is not in the stars,’’ he used to the joint resolution. misgovern. He knew that even free peoples say, ‘‘but in our own minds and hearts.’’ can be led to death and maiming because In a sense, his most lasting monument is Pending: they do not realize that all wars are against invisible. It is the thousands of names that (1) Feinstein amendment No. 274, in the na- their interests. The tragedy of his life is his are not engraved on The Wall of the Vietnam ture of a substitute. discovery that wars, once started, tend to be- Memorial in Washington—all the names that (2) Feingold amendment No. 291, to provide come inundating forces of nature, are not there because once, long ago, he led that receipts and outlays of the Tennessee inexhorable and beyond the control of any of the fight against an unwinnable war he knew Valley Authority shall not be counted as re- the participants. was contrary to the interests of his country. ceipts or outlays for purposes of this article. He was a tory by birth and breeding, a cap- He was one of the first to diagnose the dan- (3) Graham amendment No. 259, to strike italist by background, conviction and in- gers of the arrogance of unchecked executive the limitation on debt held by the public. stinct. He used to say, ‘‘I believe that cap- power, the price of pride and hubris. He had (4) Graham amendment No. 298, to clarify italism is, by and large, the best system to the common sense to oppose old myths, the the application of the public debt limit with bring the highest standard of living to the vision to appreciate new realities, and a keen respect to redemptions from the Social Secu- most people. If, however, a country wants to feel for the great lesson of history—that the rity Trust Funds. try socialism or some other system, then price of empire is always too high. (5) Kennedy amendment No. 267, to provide they should by all means be permitted to. If half the Congress were composed of Bill that the balanced budget constitutional But I do not believe that we have the moral Fulbrights, legislative functioning might be amendment does not authorize the President right, and certainly not the capacity, to pre- extremely difficult. But unless America con- to impound lawfully appropriated funds or vent their going their own way.’’ tinues to produce two or three in every gen- impose taxes, duties, or fees. He was a conservative. He believed as the eration, America democracy as we know it (6) Bumpers modified motion to refer H.J. Founding Fathers did that governments de- might indeed perish. Res. 1 to the Committee on the Budget with rive their powers from the consent of the We have lost a great national treasure— instructions. governed. He believed in the limitation of ex- perhaps a nonrenewable resource. (7) Nunn amendment No. 299, to permit ecutive powers, in checks and balances and Sic transit. waiver of the amendment during an eco- in the separation of governmental powers. nomic emergency. Constitutionally he was a strict construc- To whom it may concern: (8) Nunn amendment No. 300, to limit judi- tionist. Mr. Clyde E. Pettit, Jr. is well known to cial review. He was a liberal, resonating to the prin- me. He is a lawyer and television producer (9) Levin amendment No. 273, to require ciples of the American Revolution and the from a prominent family in my state. He is Congress to pass legislation specifying the inherent right of all peoples to change their President of KYMA–TV and Vice President means for implementing and enforcing a bal- governments. His liberalism was in the origi- of Sun Communications. anced budget before the balanced budget nal sense of the word, derived from the word Mr. Pettit was on the United States Senate amendment is submitted to the States for liberty, in being broad-minded, undogmatic, staff during the years I was U.S. Senator ratification.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00010 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3149 (10) Levin amendment No. 310, to provide which I have discussed on previous oc- 1972, the equal rights amendment; and that the Vice President of the United States casions, that I have found objections to August 22, 1978, relating to the voting shall be able to cast the deciding vote in the in the balanced budget amendment to rights of D.C. residents. Senate if the whole number of the Senate be the Constitution. For example, I have equally divided. So, as we can see, the amendment (11) Levin amendment No. 311, to provide been troubled by the numerous super- provision under article 5 of the United that the Vice President of the United States majority requirements that are in- States Constitution has not been used cluded in the balanced budget amend- shall not be able to cast the deciding vote in very frequently. the Senate if the whole number of the Senate ment. be equally divided. As I have stated on previous occa- As to the 14th amendment, namely, (12) Pryor amendment No. 307, to give the sions that the United States Constitu- the removal of the bar from entry into people of each State, through their State tion and amendments thereto contain Congress, the right to remove disabil- representatives, the right to tell Congress ities imposed by section 3 of the 14th how they would cut spending in their State nine circumstances in which a two- in order to balance the budget. thirds vote in one or both Houses is amendment was exercised by Congress, (13) Byrd amendment No. 253, to permit a necessary to an action or to the mak- by supermajority votes in both Houses, bill to increase revenue to become law by ing of a quorum. Specifically, these at different times on behalf of certain majority vote. are, one, conviction following impeach- persons. In 1872, the disabilities were (14) Byrd amendment No. 254, to establish ment; two, expulsion of a Member; removed by a blanket act from all per- that the limit on the public debt shall not be three, override of a Presidential veto; increased unless Congress provides by law for sons ‘‘except Senators and Representa- such an increase. four, advise and consent on treaties; tives of the 36th and 37th Congresses,’’ (15) Byrd amendment No. 255, to permit the five, proposing constitutional amend- and 26 years later on June 6, 1898,—in President to submit an alternative budget. ments; six, removing the bar of entry other words, 97 years ago—Congress (16) Byrd amendment No. 258, to strike any to Congress for having engaged in in- passed legislation removing the dis- reliance on estimates. surrection or rebellion against the ability imposed by section 3. (17) Byrd amendment No. 259, to provide United States; and seven, determining that any bill to increase revenues shall not The authority of Congress to deter- become law unless three-fifths of the whole the President’s ability to discharge his duties following a Vice Presidential mine Presidential disability under sec- number of each House shall provide by law tion 4 of the 25th amendment has never for such an increase by a rollcall vote. declaration of Presidential disability. (18) Byrd amendment No. 252, to permit In addition, article II, section 1, been exercised since the amendment’s outlays to exceed receipts by a majority clause 3, and the 12th amendment, ratification in February, 1967. It should vote. which supersedes the article II provi- be noted, however, that President (19) Kerry motion to commit H.J. Res. 1 to sion, require a two-thirds quorum when Reagan did notify the Speaker of the the Committee on the Budget. the election of the President and/or House and the Senate President pro (20) Hatch (for Dole) motion to recommit tempore of his temporary disability on H.J. Res. 1 to the Committee on the Budget Vice President should be decided by with instructions. Congress. The actual vote, however, re- July 13, 1985. The disability, due to an- (21) Hatch (for Dole) motion to recommit mains a constitutional majority. esthesia administered during surgery, H.J. Res. 1 to the Committee on the Budget In several of these instances, the was subsequently terminated later the with instructions. supermajorities have either never been same day. (22) Hatch (for Dole) motion to commit called into play or have been resorted H.J. Res. 1 to the Committee on the Judici- What I have attempted to show here, ary with instructions. to only in a few instances and, in some Mr. President, is the dearth of in- (23) Hatch (for Dole) motion to commit instances, the last occasion in which stances in which many of these super- H.J. Res. 1 to the Committee on the Judici- the particular provision was called into majorities, that are included in the ary with instructions. play was decades ago. original Constitution and the amend- The PRESIDING OFFICER. Under For example, in the case of the expul- ments thereto, have actually been the previous order, the Senator from sion of a Member, which requires a called into play. And as I say in some West Virginia [Mr. BYRD] is now recog- supermajority, the last instance in instances decades have passed since which a Member of Congress was actu- nized. these provisions last were activated. ally expelled was in 1862, when Waldo (Mr. HELMS assumed the chair.) These supermajorities, however, deal P. Johnson, Democrat of Missouri, was Mr. BYRD. I thank the Chair. with the structure of our form of gov- Mr. President, I have discussed this expelled for having supported the re- ernment, or with the protection of in- request with the distinguished Senator bellion. Therefore, in that instance, as dividual rights. from Utah. I think, at the moment, he we can see, it was 133 years ago when might be constrained to object, because that situation requiring a super- But here we come now with this I believe he will want to discuss the re- majority last arose. amendment to the Constitution to bal- quest with the majority leader. But I In the case of constitutional amend- ance the budget which requires super- will make it for the RECORD just now ments, for which supermajorities are majorities in enforcing fiscal policy— and then I will withdraw it. required in both Houses and by the for example, in section 1, section 2, sec- Mr. President, I ask unanimous con- States, only 27 amendments have been tion 4, and section 5. Included in those sent that my amendments be voted on adopted, and 17 of those have been supermajorities is the phraseology of in the following order: No. 252, 254, 255, adopted since the first 10 amendments. section 4 which refers to approval by 253, and 258, and that amendment No. There are six additional amendments ‘‘a majority of the whole number of 289 be withdrawn. that have been submitted to the each House,’’ and of section 5 which I withdraw that request until such States, thus having received the req- does likewise. uisite two-thirds in both Houses, but time as the distinguished Senator from Mr. President, the requirement of ap- which have failed on ratification. The Utah can discuss it with the majority proval by a majority of the whole num- following are those six amendments leader. ber of each House can very well in Mr. President, on tomorrow, the Sen- that did not receive the requisite sup- some instances require more votes ate will begin voting on the amend- port of three-fourths of the States: than a two-thirds vote depending upon ments that have been called up and September 25, 1789, an amendment how many Senators or House Members made to qualify under the order that dealing with the number of Representa- are present and voting. was entered previously. I believe that tives in the House; an amendment there are in the nature of 22 or 23 or 24 adopted during the second session of The instances in the original Con- amendments that are on the list. the 11th Congress relating to accept- stitution and the amendments thereto Among those amendments, I have five ance of foreign titles of nobility; an that require two-thirds majorities, re- amendments. I am not counting the amendment adopted and submitted to quire a two-thirds majority of those amendment which I anticipate that I the States on March 2, 1861, prohibiting Senators and House Members ‘‘present will withdraw. congressional abolition of slavery; and voting’’, except in the instance of Mr. President, in the main, my June 2, 1926, authorizing the Congress treaties and convictions on impeach- amendments go to certain of the flaws, to enact child labor laws; March 22, ments. I seem to remember that in

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00011 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3150 CONGRESSIONAL RECORD — SENATE February 27, 1995 those two instances a two-thirds ma- one to subject the sense of the majority to Total outlays for any fiscal year shall not jority of the Senators ‘‘present’’ are re- that of the minority. exceed receipts for that fiscal year, unless quired—not two-thirds of the Senators Hamilton, in the Federalist No. 22 three-fifths of the whole number of each who are chosen and sworn, not two- says this, about giving the minority a House of Congress shall provide by law for a specific excess of outlays over receipts. . . . thirds of those Senators who are vot- negative on the majority: ing, but two-thirds of the Senators To give a minority a negative upon the Hence, the people are to be left with- ‘‘present’’. majority (which is always the case where out assurance as to whether or not May I inquire of the Chair if I am more than a majority is requisite to a deci- their Government is going to be con- correct? sion) . . . stant. These supermajorities promote The PRESIDING OFFICER. The Let me read that again because it inconstancy. Let us see what Madison, Chair informs the Senator from West goes to the provisions that require a in the Federalist No. 62, has to say Virginia he is correct. majority of the whole number of each about such. Mr. BYRD. I thank the Chair. body, that are to be found in sections 4 What prudent merchant will hazard his for- But, now, this balanced budget and 5 of the balanced budget amend- tunes in any new branch of commerce when ment. he knows not but that his plans may be ren- amendment, in section 1, which deals dered unlawful before they can be executed? To give a minority a negative upon the with balancing outlays and receipts, What farmer or manufacturer will lay him- majority (which is always the case where any waiver requires that ‘‘three-fifths self out for the encouragement given to any more than a majority is requisite to a deci- of the whole number of each House of particular cultivation or establishment, sion) is, in its tendency, to subject the sense when he can have no assurance that his pre- Congress shall provide by law for a spe- of the greater number to that of the lesser paratory labors and advances will not render cific excess of outlays over receipts by number. a rollcall vote.’’ him a victim to an inconstant government? * * * * * Section 2, the provision whereby the In a word, no great improvement or laudable In those emergencies of a nation in which enterprise can go forward which requires the limit on the debt may be increased, the goodness or badness, the weakness or auspices of a steady system of national pol- ‘‘three-fifths of the whole number of strength, of its government is of the greatest icy. each House’’ is required to waive that importance, there is commonly a necessity Madison continues: stricture. for action. The public business must in some Section 4: ‘‘No bill to increase rev- way or other go forward. If a pertinacious But the most deplorable effect of all is that minority can control the opinion of a major- diminution of attachment and reverence enue shall become law unless approved which steals into the hearts of the people to- by a majority of the whole number of ity, respecting the best mode of conducting it, the majority in order that something may wards a political system which betrays so each House by a rollcall vote.’’ be done must conform to the views of the mi- many marks of infirmity, and disappoints so Well, as I have already indicated, de- nority; and thus the sense of the smaller many of their flattering hopes. No govern- pending upon how many Members are number will overrule that of the greater and ment, any more than an individual, will long present and voting in each House, that give a tone to the national proceedings. be respected without being truly respectable; requirement could well require more Hence, tedious delays; continual negotiation nor be truly respectable without possessing a than a two-thirds or three-fifths major- and intrigue; contemptible compromises of certain portion of order and stability. ity of those present and voting. the public good. And yet, in such a system it Daniel Webster said, ‘‘Let us develop And the same thing obtains with re- is even happy when such compromises can the resources of our land, call forth its take place: for upon some occasions things spect to section 5 of the balanced budg- powers, build up its institutions, pro- will not admit of accommodation; and then mote all its great interests, and see et amendment. Any resolution allow- the measures of government must be injuri- ing for the provisions of the article to ously suspended, or fatally defeated. It is whether we also, in our day and gen- ‘‘be waived for any fiscal year in which often by the impracticability of obtaining eration, may perform something wor- the United States is engaged in mili- the concurrence of the necessary number of thy to be remembered.’’ tary conflict which causes an immi- votes kept in a state of inaction. Its situa- Webster was talking about the devel- nent and serious military threat to na- tion must always savor of weakness, some- opment of the country, and about in- tional security,’’ must be adopted by a times border upon anarchy. vesting in the Nation, in its people, in majority of the whole number of each Mr. President, you see we have to go its highways, its railroads, its water- House, which, in the case of the Sen- through these Perils of Pauline in ways. But such investment needs to be ate, means at least 51—and that re- every fiscal year. on a multi-year basis—it requires reli- quirement may very well be more than The Northwest Ordinance was being ability, predictability, and consistency two-thirds or more than three-fifths of debated in New York City at the very in accordance with long-term planning the Senators who are present and vot- same time that the Constitutional Con- and design. Such investment planning ing. vention was meeting in Philadelphia. must not be subjected to the fits and These are very difficult strictures to On July 13, 1787, the Northwest Ordi- starts that will result from annual overcome—these supermajority re- nance was adopted. And that ordinance supermajority requirements to balance quirements that are being written into is one of the most important docu- the Federal budget. the Constitution by this balanced ments in the history of this country, Madison, in 62, is talking about this budget amendment—more constrictive and it rates—not as high as the Con- inconstancy and unpredictability in than any of the supermajorities writ- stitution and the Declaration of Inde- Government policy that would be ten into the original constitution and/ pendence, but it may rank a very close brought about by this spate of new and or amendments thereto. third. It may be instructive to note very difficult supermajorities required Mr. President, let us see what the au- that the Northwest Ordinance required in the implementation of fiscal policy. thors of the Federalist Papers have to only simple majorities in the votes of What prudent merchant will hazard his for- say about supermajorities. Hamilton in the council, which would correspond tunes in any new branch of commerce, when the Federalist No. 75 said and I quote: with the Senate in the Federal Con- he knows not but that his plans may be ren- stitution, and in the votes of the rep- dered unlawful before they can be executed? . . . all provisions which require more than resentatives who were to be elected. What farmer or manufacturer will lay him- the majority of any body to its resolutions self out for the encouragement given to any have a direct tendency to embarrass the op- It also should be remembered that when and where these supermajorities particular cultivation or establishment, erations of the government and an indirect when he can have no assurance that his pre- one to subject the sense of the majority to are required—and I have listed four in- paratory labors and advances will not render that of the minority. stances here in the balanced budget him a victim to an inconstant government? In other words, they create a minor- amendment in which supermajorities In a word no great improvement or laudable ity veto. would be required—they promote enterprise, can go forward, which requires I will read Hamilton’s statement in unreliability and unpredictability. the auspices of a steady system of national Federalist No. 75 again. People cannot count on, from year to policy. . . . all provisions which require more than year, just what is going to happen, and There are also those who are con- the majority of any body to its resolutions how their lives are to be affected, be- cerned, like myself, with respect to have a direct tendency to embarrass the op- cause we are talking about balancing section 5, which deals with military erations of the government and an indirect the budget in every fiscal year. conflicts.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00012 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3151 Section 5. The Congress may waive the to procure, would be as limited in their ex- What substitute can there be imagined for provisions of this article for any fiscal year tent as burthensome in their conditions. this ignis fatuus in finance, but that of per- in which a declaration of war is in effect. They would be made upon the same prin- mitting the national government to raise its The provisions of this article may be waived ciples that usurers commonly lend to bank- own revenues by the ordinary methods of for any fiscal year in which the United rupt and fraudulent debtors—with a sparing taxation, authorized in every well-ordered States is engaged in military conflict which hand and at enormous premiums. constitution of civil government? causes an imminent and serious military Then Hamilton in 22 goes on to say Mr. President, we are not going to threat to national security and is so declared this: have ‘‘ordinary methods of taxation’’ if by a joint resolution, adopted by a majority of the whole number of each House, which Suppose, for example, we were engaged in a this balanced budget amendment is ap- becomes law. war, in conjunction with one foreign nation proved because, in order to increase against another. Suppose the necessity of revenues, ‘‘a majority of the whole Let us see what Hamilton has to say our situation demanded peace, and the inter- in the Federalist No. 30. number of each house’’ will be required est or ambition of our ally led him to seek to do so. And in some instances, as I the prosecution of the war, with views that How can it undertake or execute any lib- have already demonstrated, that may eral or enlarged plans of public good? might justify us in making separate terms. Let us attend to what would be the effects In such a state of things, this ally of ours amount to more than a two-thirds of this situation in the very first war in would evidently find it much easier by his vote. It may actually amount to more which we should happen to be engaged. We bribes and intrigues to tie up the hands of than two-thirds or three-fifths of the will presume, for argument’s sake, that the government from making peace, where two- total membership in a given situation. revenue arising from the impost duties an- thirds of all the votes were requisite to that Continuing with Hamilton’s Fed- swers the purposes of a provision for the pub- object, then where a simple majority would eralist No. 30: lic debt and of a peace establishment for the suffice. In the first case he would have to Ingenious men may declaim with plausi- Union. Thus circumstanced, a war breaks corrupt a smaller number; in the last, a bility on any subject; but no human inge- out. What would be the probable conduct of greater number. Upon the same principle, it nuity can point out any other expedient to the government in such an emergency? would be much easier for a foreign power rescue us from the inconveniences and em- Taught by experience that proper depend- with which we were at war, to perplex our barrassments, naturally resulting from de- ence could not be placed on the success of councils and embarrass our exertions. In a fective supplies of the public treasury. requisitions, unable by its own authority to commercial view, we may be subjected to How is it possible that a government half lay hold of fresh resources, and urged by con- similar inconveniences. supplied and always necessitous, can fulfill siderations of national danger, would it not We have discussed section 5 of this the purposes of its institution—can provide be driven to the expedient of diverting the balanced budget amendment here- for the security of—advance the prosperity— funds already appropriated from their proper tofore. It is very obvious that, when it or support the reputation of the common- objects to the defense of the State? comes to dealing with an imminent wealth? How can it ever possess either en- Mr. President, note that Hamilton military threat to the Nation’s secu- ergy or stability, dignity or credit, con- refers to ‘‘the expedient of diverting rity, the Congress may be hard pressed fidence at home or respectability abroad? the funds already appropriated from to secure a majority of the whole num- Mr. President, this new amendment their proper objects to the defense of ber of each House in order to lift this with its supermajorities will makes the State?’’ burdensome restriction of requiring this Nation musclebound. It will put I have heard Senators who are sup- that outlays not exceed receipts in a the Nation in a straitjacket when it porters of this amendment say that, if given fiscal year. comes to the necessity of increasing we get into a military exigency we will Let us see what Hamilton, in the revenues, when it comes to the neces- just cut other programs, we will divert Federalist No. 30, says that might have sity of waving the requirements that funds from other programs—as though some bearing upon this situation. outlays not exceed receipts. we have plenty of time during a mili- It has been already observed that the fed- Let us look at the plausibility of tary exigency to go through all this ex- eral government ought to possess the power these new supermajorities which fly in amination of other programs and of providing for the support of the national the face of what the Framers con- projects and take our pencils and add forces; in which proposition was intended to templated. I call attention to the fact up and subtract all those things. We do be included the expense of raising troops, of that, under the Articles of Confed- not have time for that during an emer- building and equipping fleets, and all other eration agreed to on November 15, 1777, gency involving our military security. expenses in any wise connected with mili- tary arrangements and operations. But these supermajorities were required in great Hamilton is here speaking of divert- number—one of the reasons why the ing funds already appropriated from are not the only objects to which the juris- diction of the Union in respect to revenue Articles of Confederation did not work their proper objects to the defense of must necessarily be empowered to extend. It well. I shall read from article 10 of the the state. must embrace a provision for the support of Articles of Confederation. It is not easy to see how a step of this kind the national civil list; for the payment of the The united states in congress assembled could be avoided; and if it should be taken, it national debts contracted or that may be shall never engage in a war, nor grant letters is evident that it would prove the destruc- contracted; and, in general, for all those of marque and reprisal in time of peace, nor tion of public credit at the very moment matters which will call for disbursements enter into any treaties or alliances, nor coin that it was becoming essential to the public out of the national treasury. The conclusion money, nor regulate the value thereof, nor safety. is that there must be interwoven in the ascertain the sums and expences necessary * * * * * frame of the government a general power of for the defence and welfare of the united In the modern system of war, nations the taxation, in one shape or another. states, or any of them, nor emit bills, nor most wealthy are obliged to have recourse to I have heard certain Republican Sen- borrow money on the credit of the united large loans. ators recently on this floor state that states, nor appropriate money, nor agree But who would lend to a government that they will never vote for a tax increase. upon the number of vessels of war, to be prefaced its overtures for borrowing by an Yet, Mr. President, it may be abso- built or purchased, or the number of land or act which demonstrated that no reliance lutely necessary to have a tax increase, sea forces to be raised, nor appoint a com- could be placed on the steadiness of its meas- mander-in-chief of the army or navy, unless ures for paying? if the Nation is faced with a military nine states assent to the same; nor shall a exigency such as that contemplated in Section 2 deals with the limit on the question on any other point, except for ad- section 5 of the balanced budget journing from day to day be determined, un- debt of the United States: amendment, and increases in taxes less by the votes of a majority of the united The limit on the debt of the United States may also be necessary to balance the states in congress assembled. held by the public shall not be increased un- budget, or to pay for other important less three-fourths of the whole number of Well, there were 13 States. Nine votes each house shall provide by law for such an objects that are within the jurisdiction would mean a majority of the whole increase by a rollcall vote. of the Congress and the Union. number. But in the case of ascertaining Hamilton, in the Federalist No. 30, Hamilton says: the sums and expenses necessary for goes on to say: the defense and welfare of the United But who would lend to a government that What substitute can there be imagined for prefaced its overtures for borrowing by an States or to borrow money on the cred- this — act which demonstrated that no reliance ignis fatuus it of the United States or to appro- could be placed on the steadiness of its meas- That is a will-o’-the-wisp or jack-o- priate money or to agree upon the ures for paying? The loans it might be able lantern. number of vessels at war to be built or

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00013 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3152 CONGRESSIONAL RECORD — SENATE February 27, 1995 purchased, or to agree upon the num- regulated. The judiciary, on the contrary, If it ever becomes a part of the Con- ber of land or sea forces to be raised, a has no influence over either the sword or the stitution, much of what Madison and supermajority of 9 States out of the 13 purse. . . . It proves incontestably that the Hamilton have said in the Federalist would be required in each of those in- judiciary is beyond comparison the weakest Papers will have been thrust aside by of the three departments of power. stances. Hence, the Articles of Confed- . . . there is no liberty, if the power of today’s would-be Framers. This power eration were filled with requirements judging be not separated from the legislative over the purse may, in fact, be shifted for supermajorities. As I say, that was and executive powers. to the executive and judicial branches one of the primary reasons why the Ar- Mr. President, when this new amend- of Government and away from the peo- ticles of Confederation did not work. ment is adopted and later ratified—if it ple’s representatives in Congress. So, the Framers of our Constitution, is adopted and ratified—it will stand There is also a danger of too-frequent some of whom had served in the Con- Hamilton’s words on their head. The amendments to the Constitution. Ham- gress under the Articles of Confed- judiciary will then become the strong- ilton warned of this in Federalist No. eration, saw the bane of those super- est of the three departments of power, 49. majorities and were determined that rather than the weakest, as Hamilton . . . as every appeal to the people would the new Constitution would not con- carry an implication of some defect in the had said in the Federalist No. 78. Government, frequent appeals would, in tain them. Therefore, only a majority No one can say, Mr. President, with is required to exercise the great policy great measure, deprive the Government of absolute certitude as to what will hap- that veneration, which time bestows on ev- powers that are granted in article I, pen if and when this amendment is erything, and without which perhaps the section 8 and in section 9 of the Con- made a part of the Constitution. No- wisest and freest governments would not stitution. body can say with absolute certainty. possess the requisite stability. I offered an amendment last week But we have to explore these possibili- So here we are, we are about to ap- that would have eliminated the prob- ties, and I fear, with great alarm, the peal to the people again by submitting lem with section 5, insofar as a major- possibility, nay the probability, that to them this balanced budget constitu- ity of the whole number of each House the power of the purse will be shifted tional amendment. The fact that the is required to lift the restrictions of to the executive; and when cases or Senate has taken 30 days to deliberate the balanced budget amendment in a controversies arise, the courts will in- on this amendment, points, Mr. Presi- time of serious conflict, the security of tervene and we will have situations in dent, to the utility of the Senate. This the Nation being at stake. My amend- which the courts, made up of unelected balanced budget amendment was ment was tabled by a vote of 55 to 41. judges with life tenures, will be telling adopted by the other body in 2 days—2 The language of section 5 remains. the Congress when to tax, where to tax, days! Including tomorrow, the balanced I talked about the possibility of a how much to tax, when to cut pro- budget amendment will have been be- Vice President not being able to cast a grams, what programs to cut, and by fore the Senate for a total of 30 days. vote that would count in a situation how much, and it will be a sad day During those 30 days, Senators have de- arising under section 5 of the balanced when our country awakens to the fact bated at considerable length the entire budget amendment, because at least 51 that the judiciary is the strongest of new article, and they have found nu- Senators would be required. At least 51 the three branches. Even if there were merous flaws which, upon careful prob- Senators would be required to lift the a way to exclude the judiciary—and the ing, were brought to light. This did not strictures imposed by the balanced Johnston amendment was an attempt happen in the other body. It happened budget amendment. In the event of a to do so, but it was rejected—the legis- here because this is the U.S. Senate, 50–50, or a 48–48, or a 47–47 vote—a vote lative branch would still be weakened. where there is unlimited debate, which of the Vice President could not break Mr. NUNN has an amendment which can only be shut off by a cloture mo- the tie to make a simple majority. A will be voted on. I will support the tion or by a unanimous-consent agree- minimum of 51 Members of the Senate Nunn amendment, as I supported the ment entered into by all Senators. must vote to lift such restrictions in a Johnston amendment. But I do not I believe the constitutional Framers time of danger to the Nation. concede that that amendment will would have been proud of the Senate in Here is what Hamilton said in Fed- eliminate all prospects of the judicial this instance. I do not know how proud eralist No. 68: branch’s entering into the political they would be of the Senate, once the The appointment of an extraordinary per- thicket of decisions with respect to rollcall vote is taken tomorrow son, as Vice President, has been objected to evening upon the final disposition of as superfluous, if not mischievous. this new article, the balanced budget . . . two considerations seem to justify the amendment. this glittering gewgaw of glorified gar- ideas of the convention in this respect. One What did Madison say about the bage. That remains to be seen. I hope is, that to secure at all times the possibility power of the purse in Federalist No. 58? they will be proud of it, as they look of a definitive resolution of the body, it is This is what he said: down from above, because I hope that necessary that the President should have The House of Representatives cannot only the amendment will be defeated. only a casting vote. refuse, but they alone can propose the sup- Madison spoke of the utility of the There are other dangers in the bal- plies requisite for the support of Govern- Senate in Federalist No. 62. anced budget amendment that I have ment. They, in a word, hold the purse; that The necessity of a senate is not less indi- cited from time to time. I think it is powerful instrument by which we behold, in cated by the propensity of all single and nu- pregnant with an invitation to the ju- the history of the British Constitution, an merous assemblies to yield to the impulse of diciary to intervene. There is nothing infant and humble representation of the peo- sudden and violent passions, and to be se- ple, gradually enlarging the sphere of its ac- in the balanced budget amendment duced by factious leaders into intemperate tivity and importance, and finally reducing, and pernicious resolutions. that either forbids or invites the judici- as far as it seems to have wished, all the What Madison said in the Federalist ary to intervene in the enforcement of overgrown prerogatives of the other the balanced budget amendment. But I branches of the Government. This power No. 62 reflects exactly what took place think that circumstances themselves over the purse may, in fact, be regarded as in the House of Representatives—pas- would result in the intervention by the the most complete and effectual weapon with sage after only 2 days of debate on this judiciary when it came to cutting pro- which any constitution can arm the imme- amendment. Let me read Madison’s grams, increasing taxes, deciding other diate representatives of the people, for ob- words again from the Federalist No. 62. taining a redress of every grievance, and for The necessity of a senate is not less indi- problems and cases and controversies carrying into effect every just and salutary that might arise under this new article cated by the propensity of all single and nu- measure. merous assemblies, to yield to the impulse of and even outside the new article. In the Federalist No. 48, by Madison, sudden and violent passions, and to be se- I read from Hamilton, Federalist No. we are told, duced by factious leaders, into intemperate 78: . . . the legislative department alone has and pernicious resolutions. . . . The muta- The executive not only dispenses the hon- access to the pockets of the people. bility in the public councils, arising from a ors, but holds the sword of the community. rapid succession of new members, however The legislature not only commands the All this is going to be changed, Mr. qualified they may be, points out, in the purse, but prescribes the rules by which the President, once this balanced budget strongest manner, the necessity of some sta- duties and rights of every citizen are to be amendment goes into the Constitution. ble institution in the government.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00014 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3153 And in Federalist No. 63, Madison able to subvert the power of the people, and markets. Finally, there is no reason to as- continues to write about the utility of to usurp for themselves the reigns of govern- sume that Federal Reserve decisions will be having a Senate. I quote: ment; destroying afterwards the very en- influenced by the single goal of stabilizing gines which have lifted them to unjust do- output and employment levels. Historically, . . . so there are particular moments in minion. concern about inflation has been the major public affairs when the people, stimulated by Mr. President, the proponents of this determinant of Federal Reserve actions. In- some irregular passion, or some illicit ad- amendment in the Congress are really deed, some proponents of the balanced budg- vantage, or misled by the artful misrepresen- et amendment have also proposed legislation tations of interested men, may call for meas- living in a fool’s paradise. They are liv- ing in a state of illusive bliss, sus- that would require the Federal Reserve’s ures which they themselves will afterwards only policy target to be price stability. If be the most ready to lament and condemn. pended in the limbo of hypocrisy, such legislation were also to become law, In these critical moments, how salutary will doublespeak, double-shuffle, vanity, neither monetary nor fiscal policy would be be the interference of some temperate and and nonsense. Milton spoke about the available to limit the ups and downs of the respectable body of citizens, in order to limbo of vanity in ‘‘Paradise Lost.’’ business cycle and their attendant human check the misguided career and to suspend Dante wrote in his ‘‘Divine Comedy’’ and economic costs. the blow meditated by the people against Deficit reduction can be achieved even themselves, until reason, justice, and truth that limbo was the first circle of Hell. without a balanced budget amendment. This can regain their authority over the public Mr. President, let me close by re- Administration, working with the Demo- mind? What bitter anguish would not the membering some words from the crats of the 103rd Congress, dramatically re- people of Athens have often escaped if their ‘‘Rubaiyat’’ written by Omar duced the deficits for FY1994 and FY1995, and government had contained so provident a Khayyam, a Persian poet of the 12th the budget we have just presented for FY1996 safeguard against the tyranny of their own century: makes additional progress. If it were not for passions? Popular liberty might then have The Moving Finger writes; and, having the interest owed on the debt accumulated escaped the indelible reproach of decreeing writ, during the 1981–92 period, the federal budget to the same citizens the hemlock on one day Moves on: nor all your Piety nor Wit would be in balance by 1996 and headed to- and statues on the next. Shall lure it back to cancel half a Line, ward surplus thereafter. Based on our projec- Mr. President, how much time do I Nor all your Tears wash out a Word of it. tions, the Clinton Administration will be the have remaining? Mr. President, I ask unanimous con- first since the Johnson Administration to The PRESIDING OFFICER. The sent to have printed in the RECORD an run a non-interest budget surplus for a cycle Chair is advised the Senator has 9 min- editorial from the New York Times of of four fiscal years. Moreover, net federal utes remaining. debt, after tripling during the 1980s, has now today, February 27, titled ‘‘Unbalanced Mr. BYRD. I thank the Chair. stabilized relative to the size of the econ- Mr. President, that Montesquieu or Amendment,’’ together with letters omy, and the deficit is projected to decline Locke or Washington or Madison or from the Secretaries of Defense; Hous- relative to the size of the economy for at Hamilton could have believed in the ing and Urban Development; Edu- least the next ten years. A balanced budget amendment offers only fooleries contained in this constitu- cation; Veterans Affairs; Health and Human Services; and Justice; and var- a promise to reduce the deficit—it does not tional amendment on the balanced reduce the deficit by a single penny. And it budget cannot be suspected. ious and sundry other articles and ma- terials that are germane to the subject has the potential to cause serious economic I should think that the amendment harm. I urge you to vote against it for the might very well be pronounced as the of the balanced budget amendment. economic well-being of the Nation. ‘‘gunpowder plot’’ against the Con- There being no objection, the mate- Sincerely yours, stitution. The Gunpowder Plot was rial was ordered to be printed in the LAURA D’ANDREA TYSON, that conspiracy which was discovered RECORD, as follows: Chair. EXECUTIVE OFFICE OF THE PRESI- MARTIN N. BAILY, and foiled when Guy Fawkes and a Member-Nominee. group of Englishmen intended to blow DENT, COUNCIL OF ECONOMIC AD- VISERS, JOSEPH E. STIGLITZ, up the English Parliament on Novem- Washington, DC, February 23, 1995. Member. ber 5, 1605, the day that King James I Hon. ROBERT C. BYRD, was to address it. U.S. Senate, [From the Washington Post, Feb. 7, 1995] Fortunately the plot was foiled. Washington, DC. IT’SARECIPE FOR ECONOMIC CHAOS Whether or not this ‘‘gunpowder plot’’ DEAR SENATOR BYRD: The Council of Eco- (By Laura D’Andrea Tyson) against the Constitution will be foiled nomic Advisers is strongly opposed to a bal- will be determined by tomorrow’s vote, anced budget amendment to the Constitu- Continued progress on reducing the deficit is sound economic policy, but a constitu- but I will cast one vote to help in its tion. Although continued progress on deficit reduction is sound economics, a balanced tional amendment requiring annual balance demise. budget amendment is not. As the attached of the federal budget is not. The fallacy in Mr. President, I think that about the opinion piece which appeared in The Wash- the logic behind the balanced budget amend- best that can be said of the amendment ington Post two weeks ago indicates, such an ment begins with the premise that the size of is that it is a partisan, political amend- amendment would eliminate the ability of the federal deficit is the result of conscious ment. In it we can see the ‘‘cloven the Federal budget to moderate the cyclical policy decisions. This is only partly the case. foot’’ as to the intentions of most of ups and downs of business cycles which are The pace of economic activity also plays an those in the Senate who support it. It normal occurrences in a market economy. important role in determining the deficit. An economic slowdown automatically de- is a political amendment. It is sup- Indeed, a balanced budget amendment would actually require budgetary policy to aggra- presses tax revenues and increases govern- ported by a political party, as witness vate the business cycle, by requiring Con- ment spending on such programs as unem- the fact that all but one of the Repub- gress to increase taxes or cut spending when- ployment compensation, food stamps and lican Senators will very likely vote for ever the economy slowed in order to avoid an welfare. it. Political ads have been run through- increase in the deficit. Statistical analysis Such temporary increases in the deficit act out the Nation by the Republican performed at the Council and at the Depart- as ‘‘automatic stabilizers,’’ offsetting some Party in support of it. It is a partisan ment of the Treasury indicates that the of the reduction in the purchasing power of amendment. That is what we are about amendment would cause recessions to be the private sector and cushioning the econo- to nail into the Constitution. substantially deeper. my’s slide. Moreover, they do so quickly and automatically, without the need for lengthy Washington, in his farewell address, With fiscal policy enjoined by a balanced budget amendment to be destabilizing rather debates about the state of the economy and warned us against putting in the place than stabilizing, sole responsibility for mod- the appropriate policy response. of erating the business cycle would rest with By the same token, when the economy The delegated will of the nation the will of the Federal Reserve. As the attached anal- strengthens again, the automatic stabilizers party, often a small but artful and enter- ysis indicates, even a well-intentioned and work in the other direction: tax revenues prising minority of the community; and, ac- prescient Federal Reserve would not be able rise, spending for unemployment benefits cording to the alternate, triumphs of dif- to play this role as well on its own as it can and other social safety net programs falls, ferent parties, to make the public adminis- working in tandem with the automatic fiscal and the deficit narrows. tration the mirror of the ill concerted and stabilizers. Moreover, in order to fulfill this A balanced budget amendment would incongruous projects of faction . . . they are responsibility, the Federal Reserve might throw the automatic stabilizers into reverse. likely, in the course of time and things to well have to foster greater cyclical varia- Congress would be required to raise tax rates become potent engines, by which cunning, bility in interest rates, something which or cut spending programs in the face of a re- ambitious, and unprincipled men, will be en- could have a destabilizing effect on financial cession to counteract temporary increases in

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00015 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3154 CONGRESSIONAL RECORD — SENATE February 27, 1995 the deficit. Rather than moderating the nor- In other words, independent monetary pol- The Balanced Budget Amendment (BBA) mal ups and downs of the business cycle, fis- icy decisions by the Federal Reserve would could severely jeopardize America’s national cal policy would be required to aggravate require immediate and painful budgetary ad- security, and that is one of the major rea- them. justments. Where would they come from? sons for the Administration’s opposition to A simple example from recent economic Not from interest payments and not, with it. Unless legislatively exempted from reduc- history should serve as a cautionary tale. In such short notice, from entitlement pro- tions, defense spending could end up being fiscal year 1991, the economy’s unanticipated grams. Rather they would have to come from the primary billpayer to make federal budg- slowdown caused actual government spend- either a tax increase or from cuts or possible ets balance, and that would fundamentally ing for unemployment insurance and related shutdowns in discretionary programs whose undermine the security of our nation. items to exceed the budgeted amount by $6 funds had not yet been obligated. This is not If the Balanced Budget Amendment were billion, and actual revenues to fall short of a sensible way to establish budgetary prior- adopted, America’s defense posture would be the budgeted amount by some $67 billion. In ities or maintain the healthy interaction and vulnerable to two different problems: the im- a balanced-budget world, Congress would independence of monetary and fiscal policy. pact on defense to reach a zero deficit and have been required to offset the resulting One of the great discoveries of modern eco- the effect on defense of the annual budget shift of more than $70 billion in the deficit nomics is the role that fiscal policy can play process under the BBA. in moderating the business cycle. Few if any by a combination of tax hikes and spending IMPACT ON DEFENSE TO GET TO A ZERO DEFICIT cuts that by themselves would have sharply members of the Senate about to vote on a balanced budget amendment experienced the (Chart 1) To illustrate the impact of get- worsened the economic downturn—resulting ting to a zero deficit, several assumptions in an additional loss of 11⁄4 percent of GDP tragic human costs of the Great Depression, costs made more severe by President Herbert have to be made about the final date and and 750,000 jobs. provisions of the BBA. Let us assume that The version of the amendment passed by Hoover’s well intentioned but misguided ef- the year of BBA implementation if 2002, and the House has no special ‘‘escape clause’’ for forts to balance the budget. Unfortunately make calculations based on the most recent recessions—only the general provision that the huge deficits inherited from the last dec- deficit projections by the Congressional the budget could be in deficit if three-fifths ade of fiscal profligacy have rendered discre- Budget Office. Balancing the budget on a of both the House and Senate agree. This is tionary changes in fiscal policy in response phased basis—14 percent year in 1996 through a far cry from an automatic stabilizer. It is to the business cycle all but impossible. Now 2002—would require a total of $1,040 billion in easy to imagine a well-organized minority in many of those responsible for the massive spending cuts and/or revenue increases. either House of Congress holding this provi- run-up in debt during the 1980s are leading Exactly how much the Department of De- sion hostage to its particular political agen- the charge to eliminate the automatic stabi- fense (DoD) would have to contribute to da. lizers as well by voting for a balanced budget achieving a zero deficit would depend on how In a balanced-budget world—with fiscal amendment. much revenue would be increased and wheth- policy enjoined to destabilize rather than Instead of undermining the government’s er entitlements would be cut. Under the stabilize the economy—all responsibility for ability to moderate the economy’s cyclical worst case scenario, there would be no in- counteracting the economic effects of the fluctuations by passing such an amendment, crease in revenue and no cuts in the entitle- business cycle would be placed at the door- why not simply make the hard choices and ment programs. This means the budget step of the Federal Reserve. The Fed could cast the courageous votes required to reduce would have to be balanced by cuts in discre- attempt to meet this increased responsi- the deficit—the kind of hard choices and cou- tionary spending, of which national defense bility by pushing interest rates down more rageous votes delivered by members of the represents about one half. The best case sce- aggressively when the economy softens and 103rd Congress when they passed the admin- nario assumes half of the deficit would be raising them more vigorously when it istration’s $505 billion deficit reduction offset by increases in revenue and the other strengthens. But there are several reasons package? half proportionately to spending for entitle- why the Fed would not be able to moderate ments and domestic and defense discre- the ups and downs of the business cycle on THE SECRETARY OF DEFENSE, tionary programs. its own as well as it can with the help of the Washington, DC, January 11, 1995. (Chart 2) Not reproducible in the RECORD. Hon. ROBERT C. BYRD, automatic fiscal stabilizers. (Chart 3) For national defense, the best First, monetary policy affects the economy Committee on Appropriations, case scenario would have a serious impact on indirectly and with notoriously long lags, U.S. Senate, Washington, DC. national security. The worst case would be a making it difficult to time the desired ef- DEAR SENATOR: Thank you for your recent disaster. Achieving these totals would entail fects with precision. By contrast, the auto- letter. I join you in looking forward to work- subtantial reductions to defense people and matic stabilizers of fiscal policy swing into ing together closely on crucial matters af- programs, which are already downsized to action as soon as the economy begins to fecting our nation’s future security. the minimum acceptable level deemed nec- slow, often well before the Federal Reserve Your letter asked for my assessment of the essary in the Bottom-Up Review. Our forces even recognizes the need for compensating probable and possible consequences on Amer- would become hollow and we would have to action. ica’s defense posture of an amendment to the Second, the Fed could become handcuffed Constitution requiring a balanced federal give up our quality of life initiatives such as in the event of a major recession—its scope budget. Such an assessment is detailed in the adequate compensation for military per- for action limited by the fact that it can enclosed statement, which was presented at sonnel, child care programs, decent barracks push short-term interest rates no lower than a recent hearing on this subject by John and family housing and other programs that zero, and probably not even that low. By his- Hamre, Under Secretary of Defense (Comp- provide a sense of community and support torical standards, the spread between today’s troller). This statement is an update of my for military families. We would have to stop short rates of 6 percent and zero leaves un- presentation to your committee last Feb- the modernization and recapitalization, comfortably little room for maneuver. Be- ruary 15, and I strongly support its warnings. which is needed and planned in our current tween the middle of 1990 and the end of 1992, With the absence of any realistic implemen- five-year budget. We would have to cut back the Fed reduced the short-term interest rate tation details in the amendment, [I fear that our emphasis on science and technology and technology reinvestment programs, and it controls by a cumulative total of 51⁄4 per- huge defense reductions are likely under a centage points. Even so, the economy sank balanced budget amendment, which would thereby risk the technological edge that has into a recession from which it has only re- fundamentally change the character of always given our forces an advantage over cently fully recovered—a recession whose se- America’s military posture, make our new our adversaries. Reductions such as these would fundamen- verity was moderated by the very automatic strategy unsupportable, call into question tally change the character of America’s mili- stabilizers of fiscal policy the balanced budg- our ability to fulfill U.S. commitments to tary posture, make our new strategy et amendment would destroy. our allies and to protect our interests world- Third, the more aggressive actions re- wide, and undermine U.S. global leadership.] unsupportable, call into question our ability quired of the Fed to limit the increase in the I thank you for this opportunity to inject to fulfill U.S. commitments to our allies and variability of output and employment could defense concerns into the debate on this crit- to protect our interests worldwide, and un- actually increase the volatility of financial ical issue facing our nation. dermine America’s global leadership. markets—an ironic possibility, given that Sincerely, THE ANNUAL BUDGET PROCESS UNDER THE BBA many of the amendment’s proponents may WILLIAM J. PERRY. Let me now turn to the second problem: well believe they are promoting financial Life under a balanced budget amendment. stability. STATEMENT OF UNDER SECRETARY OF DE- What about the effect on defense of the an- Finally, a balanced budget amendment FENSE (COMPTROLLER) JOHN J. HAMRE IN nual budget process under the Balanced would create an automatic and undesirable CONNECTION WITH THE BALANCED BUDGET Budget Amendment? The BBA annual budget link between interest rates and fiscal policy. AMENDMENT, HOUSE JUDICIARY COMMITTEE, process could routinely end up removing An unanticipated increase in interest rates JANUARY 10, 1995 from our elected political leaders the deci- would boost federal interest expense and Mr. Chairman, members of the Committee, sion about what level of defense spending is thus the deficit. The balanced budget amend- thank you for the opportunity to appear be- prudent. America’s defense preparedness ments under consideration would require fore you today to discuss the Balanced Budg- could get determined by economic shifts, that such an unanticipated increase in the et Amendment, and the likely impact that it cost growth in entitlements, and other non- deficit be offset within the fiscal year. would have on America’s defense posture. defense factors. Even if threats to America’s

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00016 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3155 global interests were increasing or our forces gress, Presidents, and civilian and military The proposed balanced budget amendment deteriorating, the BBA could lead to deep de- leaders as to what spending is necessary and would create havoc with our budget deci- fense cuts. wise. I do not believe such an approach to sions and program management. It could The fact that these consequences could be questions of national security would serve have a devastating impact on HUD’s mission avoided with 3⁄5 approval of each house of America well. of service to the American people and com- Congress is scant reassurance. Preservation IMPACT ON DEFENSE TO GET TO A ZERO munities. For example, our Department of an adequate defense posture would become DEFICIT worked very hard to provide emergency re- dependent on exceptional political efforts. In order to assess the impact on DOD, as- lief to the victims of natural disasters such The BBA process would be heavily skewed in sumptions have to be made about final date as the Southern California earthquake, the favor of cutting defense to compensate for and provisions of the balanced budget Midwest floods, Hurricane Andrew in Florida whatever was escalating elsewhere in the amendment: and Hurricane Iniki in Hawaii. Our ability to budget. Even when a 3⁄5 majority minus one respond rapidly and effectively to emer- in either house believed that BBA cuts were Assumption gencies could be severely curtailed by the unjustified, the minority view would prevail. balanced budget amendment. The amend- Year of implementation ...... 2002. Not exactly ideal for the world’s most power- Projected deficit at implementation .. Current budget projection. ment’s requirement of a three-fifths vote ful democracy and best hope for future peace Will revenue be increased? ...... If yes, 50%/50% revenue/spending. could cause long delays, severe hardship, and and stability. Will entitlements be cut? ...... If yes, in proportion to outlays. perhaps even irreparable harm for the many The BBA would threaten frequent inter- people that will lose their homes and ur- ruptions to the many long-term processes IMPACT OF CUTS ON NATIONAL DEFENSE gently need adequate housing in these emer- that are essential to maintaining a prudent Make substantial reductions to military gency situations. defense posture. The quality and morale of and civilian personnel. Return to ‘‘Hollow Forces.’’ While we support the goal of a balanced our people must be continually nurtured, budget, the proposals under consideration to and would be devastated by rapid and deep Cancel Quality of Life Initiatives. Stop planned modernization and recapital- achieve a balanced budget by the year 2002 cuts in end strength. Our military and civil- ization. could require an unprecedented level of re- ian professionals require extensive training Cut back on science and technology. ductions in our programs. It is our under- and experience. We cannot recruit and retain Cancel technology and reinvestment pro- standing that, if social security and defense top-notch military and civilian profes- grams. are exempt from reductions and the tax cuts sionals, if they are vulnerable to summary Fundamentally change U.S. military pos- in the Contract with America are enacted, dismissal. ture. the remaining Federal programs will have to Repair parts must be ordered three years Undermine U.S. commitments to allies. be reduced by more than 30 percent in FY ahead of anticipated use, in order to ensure Small Economic Changes Mean Big Budget 2002. For HUD, this would mean a cut of the readiness of U.S. forces. Many years of Problems about $10 billion in one year alone. Assuming research and development are needed to en- Modest changes in the economy would ne- that reductions of this magnitude would be sure that our forces are never outgunned or cessitate sweeping program cuts. evenly spread across agencies and accounts, outmaneuvered. The average major weapons the effect on HUD programs would be dev- procurement program requires 8 years of de- CBO RULE OF THUMB astating. For example, low-income rental as- velopment and testing. Production lines are [In billions of dollars] sistance, which in the President’s Budget necessarily set up anticipating stable pro- would already be declining at the end of the Deficit impact curement rates; they cannot be stopped and century, would suffer severely, putting thou- started, in order to offset a downturn in rev- First year 5-Years sands more families at risk of homelessness, enues or surge in entitlements. Because of and our capacity to assist the already home- the long-lead times needed for our weapons 1 percent rise in interest rates ...... 5 108 1 percent fall in real growth ...... 9 289 less would be crippled. A cut of 30 percent— systems, DoD is unique among executive de- $1.4 billion—in Community Opportunity Per- partments in that we must have detailed U.S. DEPARTMENT OF HOUSING AND formance Funds (CDBG), would be a major five-year plans incorporating them. It would URBAN DEVELOPMENT, THE SEC- blow to cities and communities across the be extremely costly, and essentially unwork- RETARY, nation who depend on the grant to support able, to turn on and off defense programs, Washington DC, February 8, 1995. low-income job creation and infrastructure. when the BBA forced deep budget cuts. HUD has taken a disciplined, fiscally re- In sum, budgeting under BBA would inject Senator ROBERT BYRD, sponsible, creative approach to achieving our great uncertainty and chaos into defense Ranking Minority Member, Committee on Ap- key priorities. We have proposed dramatic, planning, which needs to have stability and propriations, U.S. Senate, Washington, DC. DEAR SENATOR BYRD: This letter presents sweeping changes in the way the Department a long-term perspective. the views of the Department of Housing and is structured and operates. Implementation (Chart 4) Small changes in the U.S. econ- Urban Development on the proposed bal- of our Reinvention Blueprint would make omy would mean even bigger budget prob- anced budget amendment, House Joint Reso- HUD a more customer-driven, cost-effective, lems. Using the CBO rule of thumb, a one lution 1. We are opposed to the proposed bal- entrepreneurial organization. With consoli- percent rise per year in interest rates would anced budget amendment because it is un- dation of existing programs into perform- increase the federal budget deficit $5 billion necessary and could undermine important ance-based funds, the focus would be on serv- in the first year and 108 billion over five functions of this Department. ing people and communities and producing years. A one percent fall per year in real We certainly support the intended goal of better outcomes at significantly less cost. growth in the economy would increase the reducing the federal deficit. Indeed, in 1993 This Administration has made great deficit $9 billion in the first year and $289 bil- the President joined with Members of Con- lion over five years. Thus under the BBA, strides in reducing the size of the Federal gress to enact the largest deficit reduction budget and HUD has contributed to that ef- even modest changes in the economy could bill in history. The Administration looks for- trigger sweeping cuts to federal programs. fort. We must continue these efforts, but we ward to continuing to work with Congress on must be prudent and produce real results, CLOSING deficit reduction. not simply crowd-pleasing rhetoric. The Balanced Budget Amendment address- At the Department of Housing and Urban I am committed to working with the Con- es a very important issue, but it would dra- Development, we have established basis gress to produce savings through further re- matically complicate our ability to plan for spending priorities to guide our decisions in sponsible program rescissions, reductions and manage a strong Department of Defense. preparing budgets for FY 96 and beyond. We and reforms. Defense programs would be especially vul- have made our own hard choices and tough Sincerely, nerable under the BBA, because DoD ac- spending cuts in developing our proposed HENRY G. CISNEROS. counts for about half of all discretionary ‘‘Reinvention Blueprint’’, which would con- spending. And that is critical because the solidate 60 programs into three programs and BBA has no implementation details. Unless accomplish $800 million in administrative U.S. DEPARTMENT OF EDUCATION, the BBA becomes a vehicle by which reve- savings alone over the next five years. Fur- THE SECRETARY, nues are increased or entitlements cut, DoD ther program reforms and budget economies Washington, DC, February 22, 1995. could well have to pay for half of every dol- to be announced February 6, 1995 will show Hon. ROBERT C. BYRD, lar of deficit reduction. five year savings at HUD of $51 billion in Committee on Appropriations, U.S. Senate, DoD budget authority, in real terms, has budget authority and $13 billion in outlays. Washington, DC. been in decline since FY 1985. We have fi- In addition, we have already generated sav- DEAR SENATOR BYRD: Thank you for your nally reached the end of our builddown. It ings through a reorganization of our field recent call and your inquiry concerning the would be dangerous to continue to downsize structure to eliminate an entire layer of re- possible impact of a balanced budget amend- our forces at this time. The Balanced Budget gional management. We have found many ment to the Constitution on the operation of Amendment would cut defense spending to ways to do more with less people through Federal education programs. I have set out whatever level its arbitrary formula dic- service-oriented, performance-driven, results some examples of the effect of the implemen- tated, and thereby displace the carefully management, and partnerships with commu- tation of such an amendment on education considered judgments of Members of Con- nities and the people we serve. programs.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00017 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3156 CONGRESSIONAL RECORD — SENATE February 27, 1995

I am informed by reliable analysts that if THE SECRETARY OF VETERANS AF- all VA pension recipients below the poverty we assume that Social Security and National FAIRS, line. Defense Expenditures are exempted from the Washington, DC, January 30, 1995. Thank you for this opportunity to share reductions in Federal spending required to Hon. ROBERT C. BYRD, with you my concerns regarding the Bal- comply with a balanced budget amendment, Ranking Minority Member, Committee on Ap- anced Budget Amendment. As always, I all other Federal programs could be subject propriations, U.S. Senate, Washington, DC. greatly appreciate your concern for and sup- to an estimated 30 percent reduction from DEAR SENATOR BYRD: This is in response to port of veterans and their families. the 1995 appropriated level. your request for information on the poten- Sincerely, Based on these assumptions, the following tial effect on VA programs of the Balanced JESSE BROWN. are some specific examples of how these re- Budget Amendment that is soon to be con- ductions could affect Department of Edu- sidered on the Senate floor. I appreciate the THE SECRETARY OF HEALTH cation programs: need for continuing efforts to reduce federal AND HUMAN SERVICES, deficits and support the goal of a balanced Financial aid for college—the surest route Washington, DC, January 30, 1995. budget. However, I am extremely worried to the middle class American dream—would Hon. ROBERT C. BYRD, about how the current proposal would affect be slashed. A 30 percent cut would require a Ranking Minority Member, Committee on Ap- veterans and their families. propriations, U.S. Senate, Washington, DC. $2 billion cut in Pell Grant funding, elimi- The proponents of the amendment have re- nating awards to nearly 300,000 students and DEAR SENATOR BYRD: Much has been said fused to indicate what spending cuts they and written about adding a balanced budget reducing the average award to the remaining would make in order to eliminate the deficit 3.5 million students from $1,548 to $1,218. The amendment to the United States Constitu- by fiscal year 2002. Nevertheless, many of the tion, but I want to make sure that the Amer- termination of loan interest subsidies for 3 amendment’s proponents have indicated million low-income students and their fami- ican people and the members of Congress what they will not do to eliminate the def- fully understand what such an amendment lies could increase borrowing costs by as icit: reduce Social Security and increase much as 20 percent over the life of their could mean for the people served by the De- taxes. At the same time, they are promising partment of Health and Human Services. loans. Support for the Supplemental Edu- to create new deficit pressures by increasing cational Opportunity Grant and Work-Study Let me be clear: While we support the goal defense spending and actually reducing of a balanced budget, the proposals under programs would decline by $360 million, taxes, again without showing how they eliminating awards to more than 500,000 consideration by the Congress to achieve a would offset the enormous costs involved in balanced budget by the year 2002 could re- needy postsecondary students. These cuts their initiatives. But despite the funda- would effectively reverse 30 years of progress quire an unprecedented level of reductions in mental nature of the federal government’s our programs—including Medicare, Head in expanding postsecondary education oppor- commitment to our veterans, Balanced tunity. Start, NIH research, and Medicaid. Budget Amendment proponents have left VA If reductions to Social Security and de- Goals 2000 and School-to-Work Opportuni- programs on the table—subject to tremen- ties. Reform efforts now under way in nearly fense spending are taken off the table and dous, inevitable pressures that the amend- the tax cuts included in Contract With all States would be dramatically scaled ment will create to cut unprotected pro- back, forcing the Nation to significantly re- America are adopted, then all other domestic grams. programs, including those at HHS, would duce its commitment to high standards for It is my understanding that, if Social Se- have to be reduced by over 30 percent. This all students. Under Goals 2000, for example, curity and defense are exempt from reduc- magnitude of reduction could threaten the 45 States and 5 territories and thousands of tions and the tax cuts in the Contract With affordable, high-quality health care our el- communities are working hard to improve America are enacted, then remaining federal derly have come to expect, jeopardize the their schools, and are counting on these Fed- programs will have to be reduced by more critical research performed by our National eral dollars to help implement their edu- than 30 percent in FY 2002. Assuming, in the Institutes of Health, and drive millions more cation reform plans. current absence of specifics, that such a re- families into poverty. Title I Grants to Local Educational Agen- duction would be applied across the board, it Applying a 30 percent reduction to the cies. The $2 billion cut required by a bal- would have a devastating effect on veterans’ Medicare program to achieve the Balanced anced budget amendment could reduce as- programs. Budget Amendment goals could mean cuts of sistance to over 6 million economically dis- A 30-percent reduction to the Veterans over $100 billion in the year 2002 alone. If advantaged elementary and secondary school Health Administration would prohibit us Congress required beneficiaries to absorb the students, or even terminate services alto- from providing health care services to many full cost, it would be the equivalent of charg- gether to as many as 2 million students. of those whom we now treat. A reduction in ing an additional $215 a month to maintain Title I helps low-achieving children, particu- full-time-equivalent employees (FTEE) of the Medicare program in addition to the cur- larly those in high-poverty schools, meet the 63,000 in 2002 could be expected and we would rent projected Part B premium in 2002 of $59 same challenging academic content and per- be able to treat 488,000 fewer inpatients and a month. If these Medicare premiums are de- formance standards expected of all children. accommodate 11,403,000 fewer outpatient vis- ducted from Social Security checks, this Special Education Grants to States. Fed- its. The cutbacks could mean the closing of many VA hospitals, outpatient clinics, and would mean a 25 percent reduction in the av- eral assistance in meeting the extra costs of erage beneficiary’s Social Security check serving over 5.6 million children with dis- nursing homes. In fact, the viability of the VA as a national health-care system for vet- each month. For the one-in-four elderly abilities could drop from $426 to $298 per eli- Americans who rely almost solely on their gible child. Similar reductions for preschool erans could be threatened. It certainly could not be maintained on the same scale as to- Social Security check for their income, this and early intervention programs could lead is a painful loss. many States to stop serving younger chil- day’s system, and the Department’s ability to maintain the current high level of quality If Congress instead chooses to cut the $100 dren with disabilities, a step that could only billion from medical providers, then one of increase the need for more expensive services care could be severely damaged. Similarly, our Regional Offices could suf- two things could happen: Providers may ac- in later years. fer a reduction of 3,000 FTEE, which might cept fewer Medicare beneficiaries as pa- Impact Aid. For this program, there could make it impossible for us to process vet- tients, or they may shift the costs to their be a 30 percent reduction in Federal support erans’ claims for benefits in a timely way. non-Medicare business. This could increase for paying the operating costs of school dis- Likewise, operations in the National Ceme- private sector health costs by over 10 per- tricts enrolling large numbers of Federally tery System might have to be severely cur- cent. connected children. Districts heavily depend- tailed; impairing our ability to bury vet- For Medicaid, balancing the budget could ent on such support could be forced to under- erans with dignity. require over $55 billion in cuts in the year take such actions as furloughing or laying The many benefit programs that VA ad- 2002 alone. Because Medicaid is a Federal/ off teachers or shortening the length of the ministers for disabled veterans could also be State partnership, cuts in the Federal budget school year. subject to deep cuts. As an example, certain could force States to make up the cuts either All of these serious reductions in Federal severely disabled veterans who receive com- with increased State spending or through re- support for education could come at a time pensation for service-connected disabilities duced support to the Medicaid program. Ei- when international economic competition would, under current policy, be receiving ap- ther approach simply shifts the burdens to demands ever higher skill levels from Amer- proximately $42,400 per year by 2002. A 30- the States. Moreover, States could have to ican workers, and when our civic life and de- percent reduction in such a veteran’s earned choose between cutting services or coverage mocracy demands better educated citizens. benefit would amount to $12,721 for that to either the elderly, disabled or poor moth- It is absolutely the wrong time to take any year. This is hardly an appropriate response ers and their children. steps that might reduce our investment in for a grateful nation. Other key HHS programs could be harmed education. I hope that this information will Our pension program for non-service-dis- by a balanced budget amendment. For exam- aid your efforts to place the full implications abled wartime veterans is designed to keep ple, Head Start local programs could be of such an amendment before the Members of these disabled veterans from living a life of forced to discontinue services to almost a the United States Senate. abject poverty. A 30-percent cut in 2002 quarter of a million children. The National Yours sincerely, would result in a loss of up to $4,790 for the Institutes of Health could lose $3.5 billion. RICHARD W. RILEY. neediest of veterans, and would force nearly This would be equivalent to eliminating the

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00018 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3157 entire National Cancer Institute; the Na- States. We recognize, of course, that, be- partment of Justice. For purposes of my tional Heart, Lung and Blood Institute; and cause of the passage of time, the figures analysis this morning, I have assumed that about half of the National Institute on Neu- cited in the Attorney General’s statement any spending cuts required by the Balanced rological Disorders and Stroke. are not current. For example, the effects Budget Amendment would be pro-rated This Administration has made great upon the Department, as stated by the At- across all government programs; no single strides in reducing the size of the Federal torney General, were based on the assump- Cabinet Department or agency would be budget deficit, and the Department of Health tion that spending would have to be reduced asked to cut any more, or any less, than any and Human Services has contributed its fair by twenty percent. If a thirty percent reduc- other. All would be affected equally. share, but we must proceed down the path of tion were required, the budget impact would Applying this basic assumption, in 1999— further deficit reduction with care and with be fifty percent greater. These consider- the earliest year the Amendment could go the full knowledge of what the price will be. ations do not, however, alter in any way the into effect—the total budget deficit is pro- Sincerely, conclusions contained in the Attorney Gen- jected to be $201 billion. Because Department DONNA E. SHALALA. eral’s statement. If anything, they reinforce of Justice outlays are approximately 1 per- them. We urge that the Senate evaluate cent of total Federal outlays, we have esti- U.S. DEPARTMENT OF JUSTICE, these considerations with extreme care be- mated—again assuming that the Department OFFICE OF LEGISLATIVE AFFAIRS, fore acting on any of the Balanced Budget will be asked to make the same percentage Washington, DC, January 27, 1995. Amendments that may come before it. of spending reductions as everyone else— Hon. ROBERT BYRD, Thank you for permitting us to provide our that the Department would be cut by $2 bil- Ranking Minority Member, Committee on Ap- views on this important matter. If we may lion in outlays, or one percent of $201 billion. propriations, U.S. Senate, Washington, DC. be of additional assistance, or if you require This equates to about $1.8 billion in budget DEAR SENATOR BYRD: We understand that additional information, please do not hesi- authority by 1999, or approximately 20 per- the Senate will shortly turn its consider- tate to call upon us. The Office of Manage- cent of our discretionary budget authority. ation to various proposals to amend the Con- ment and Budget has advised that there is no Let me be blunt: If the Balanced Budget stitution to require a balanced federal budg- objection from the standpoint of the Admin- Amendment took effect today, and we were et. We certainly support the intended goal of istration’s program to the presentation of asked to cut almost $2 billion from our dis- reducing the federal deficit. Indeed, in 1993, this report. cretionary spending—the effects would be the President joined with Members of Con- Sincerely, immediate, and they would be dire. We would gress to enact the largest deficit reduction SHEILA F. ANTHONY, feel those cuts in the very areas we are now bill in history. The Administration looks for- Assistant Attorney General. trying to strengthen in order to win back our ward to continuing to work with Congress on Enclosure. streets, schools and homes against esca- deficit reduction. lating crime and violence. Before passing a balanced budget amend- STATEMENT OF JANET RENO, ATTORNEY GEN- Put simply, the Balanced Budget Amend- ment, however, the Congress should be keen- ERAL, BEFORE THE COMMITTEE ON APPRO- ment would put at risk the Justice Depart- ly aware of the impact that such an amend- PRIATIONS FEBRUARY 15, 1994 ment’s ability to fight crime. Passage of the ment could have on the essential operations Mr. Chairman and Members of the Com- Amendment would mean sharp reductions in of the federal government in general, and of all of the Department’s crime fighting units. the Department of Justice in particular. In a mittee: word, the impact could be devastating.1 INTRODUCTION THE AMENDMENT WOULD CAUSE SHARP REDUC- When the Attorney General testified before I am pleased to have this opportunity to TIONS IN ESSENTIAL DEPARTMENTAL PRO- the Senate Committee on Appropriations on appear before you today to testify on Senate GRAMS February 15, 1994, she stated that ‘‘[p]ut sim- Joint Resolution 41—the Balanced Budget Every single component of the Depart- ply, the Balanced Budget Amendment would Amendment. My remarks this morning will ment—the FBI, the DEA, INS, the U.S. At- put at risk the Justice Department’s ability be devoted to explaining why this Amend- torneys’ Offices, the U.S. Marshal’s Office, to fight crime. Passage of the Amendment ment, which I oppose, could severely under- the Bureau of Prisons, and other federal would mean sharp reductions in all of the mine the ability of the Department of Jus- prosecutors—has worked hard to meet the Department’s crime fighting units.’’ This is tice to fulfill its core function of fighting President’s FY 1995 budget. To cut them fur- as true today as it was a year ago. We be- crime. ther—as the Balanced Budget Amendment lieve now, as we did then, that the American As everyone here is no doubt aware, the would require—would not only prevent us people look to the federal government for Administration is deeply committed to from meeting our ambitious goals, but might more, not less, assistance in making their fighting crime and to making our streets and result in a significant retreat from our cur- communities safe, and that they will not schools safe once again. President Clinton rent capabilities. Let me be more specific. support arbitrary cutbacks or limitations on has made a promise to the American people As you all well know, most of the Depart- the essential resources that are urgently to use all the resources of his Administra- ment’s activities are funded out of a discre- needed to combat wrongdoing. tion to reduce the rate of crime now plagu- tionary budget authority which is under the The Attorney General also noted in her ing our communities. As the President him- jurisdiction of the Committees On Appro- statement that passage of the Balanced self said last month in his State of the Union priations. While the President’s 1995 appro- Budget Amendment would lead to sharp re- Address, ‘‘violent crime and the fear it pro- priation request for the Department includes ductions—and perhaps total elimination—of vokes are crippling our society, limiting per- only $103 million in mandatory appropria- federal aid to State and local law enforce- sonal freedom, and fraying the ties that bind tions, it includes a full $12.2 billion in discre- ment. As the Attorney General indicated, us.’’ Our charge is clear: to rid our society of tionary budget authority. This portion funds elimination of this funding would ‘‘destroy this scourge while healing the wounds that the FBI, the DEA, the INS, the U.S. Mar- any hope of implementing our community divide us. shals Offices, the U.S. Attorneys Offices, the policing and pubic safety initiatives’’—two Members of this Committee have made a Criminal Division, the Tax Division, the absolutely critical goals of last year’s crime significant contribution in the fight against Antitrust Division, the Civil Rights Division, bill. At a time when we are striving to assist crime by voting for passage of a comprehen- the Environment and Natural Resources Di- our State and local partners in ridding the sive crime bill. I salute you—and your col- vision and their respective litigating oper- Nation’s schools and streets of crime, such leagues in the Senate—for your support and ations, the Bureau of Prisons, the Office of an outcome would be tragic—and wrong. dedicated efforts toward making this legisla- Justice Programs, and other components. We have taken the liberty of enclosing a tion a reality. As I have already testified, we estimate copy of the Attorney General’s statement of As Attorney General, my most important that the Balanced Budget Amendment, if en- February 15, 1994, before the Senate Appro- responsibility to the American people is to acted, would require us to cut $2 billion from priations Committee. It goes into consider- ensure that the laws are strictly enforced our discretionary programs by 1999. Using ably greater detail than this letter about the and that all the means at my disposal are 1994 budget figures, instead of having $9.4 bil- likely negative effects that passage and rati- utilized to their fullest extent in the fight lion in discretionary funds to spend on crime fication of a Balanced Budget Amendment against crime. My testimony today will fighting measures, we would have slightly would have upon the Department of Justice focus on why the Balanced Budget Amend- more than seven and a half billion dollars. and upon law enforcement in the United ment—by forcing cutbacks in the very pro- Make no mistake about it: these cuts grams at the center of our anti-crime cru- would have immediate consequences for our 1 Many proponents of the balanced budget pro- sade—could severely undermine the Depart- department. All this at a time when we are posals have stated that they would implement the ment’s ability to banish violence from our working so hard to take back our streets and balanced budget amendment without spending re- homes and streets. to stop this devastating cycle of crime and ductions in Social Security and national defense. If At the outset, let me state very clearly the violence. this is the case, and if the tax proposals contained basic assumptions I have made in addressing With the public up in arms about the epi- in the Contract With America are adopted, all other the effects of the Balanced Budget Amend- demic of crime in our communities, I am domestic discretionary spending would have to be reduced by over 30 percent. Such reductions would ment on the Department of Justice. For pur- confident that no one on this Committee be unprecedented—indeed Draconian—and would poses of my analysis this morning, I have as- would want to see such draconian cuts in our wreak havoc on the essential law enforcement pro- sumed that any spending cuts required by crime-fighting units. Unfortunately, the Bal- grams of this Department. the Balanced Budget Amendment on the de- anced Budget Amendment might leave us

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00019 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3158 CONGRESSIONAL RECORD — SENATE February 27, 1995 with no other choice. Indeed, if forced to op- duty in small and mid-sized cities and towns his testimony, because it will highlight an- erate with the parameters of this Amend- would have to be closed. These effects would other important aspect of this debate, one ment, all the paths available to us would be felt well beyond this nation’s borders, as that merits serious consideration when you lead to one inevitable dead-end—the neces- DEA offices in drug source and transit coun- debate the merits of this Amendment. sity of limiting the resources our nation so tries would be forced to close shop. CONCLUSION desperately needs to fight crime aggres- The Immigration and Naturalization Serv- Mr. Chairman, I hope my testimony has sively. ice (INS) would need to reduce about 2400 For example, one of the cornerstones of staff members to cut $211.9 million off its made this Committee more aware of just our crime-fighting program is the assistance budget. A reduction of this magnitude would how dangerous the Balanced Budget Amend- we provide to state and local jurisdictions severely curtail INS’ ability to control the ment could be for the Department and its ef- devoted to crime prevention. In fiscal year U.S. borders and enforce the nation’s immi- forts to reduce violent crime and drugs in 1994, this assistance, most of which comes in gration laws. At a time when both the agen- America’s streets and schools. No one wants to see the deficit reduced the form of grants, will amount to nearly $1 cy and the Administration have been tar- more than this Administration. As the Presi- billion. The purpose of these funds is to help geting resources on controlling our borders, dent and the Senate showed last summer, our local and state law enforcement officials this would virtually shut down border patrol the deficit can be reduced only if we are will- by supplementing their often severely lim- operations and negate all enhancements, in- ing to make the hard and necessary choices ited resources, providing incentives for ac- cluding the increased agent strength that we to control federal spending. tion in areas of critical need, and giving achieved in 1994. The Balanced Budget Amendment is not them the tools they need to serve their com- No new prisons would be built by the Bu- the simple cure that its proponents suggest. munities. reau of Prisons (BOP), and due to lack of The hard, cold reality is that complying staff, existing institutions would have to If it does work, it will only cause painful re- with the requirements of the Balanced Budg- close. Prison overcrowding would soar, to a ductions in the very areas we are trying to et Amendment might mean eliminating aid startling 77 percent by 1999, forcing courts to bolster. to state and local law enforcement entirely. mandate the release of violent offenders The fight against crime is not easy. It has As the former prosecutor of Dade County, I back onto the street. Living conditions never been easy. Hundreds of thousands of learned first-hand how critically important would worsen, increasing the dangers posed Americans each day put their lives on the this assistance is to holding the line against to staff, inmates and the community at line to protect their fellow-countrymen and crime at the local level. I know, and Presi- large. women from the dangers of their commu- dent Clinton knows, that it is our local law The American people, tired of empty rhet- nities. We owe it to them, and to all of us enforcement officials, working in partner- oric and tired of escalating crime, are look- who are afraid to walk our streets at night ship with citizens and public interest groups, ing to us to provide direct and immediate ac- or to attend schools during the daytime, to who are leading the fight to take back our tion to make our communities safe once provide them with the resources to stamp streets. If that money is eliminated, it would again. By passing the Balanced Budget out this epidemic of crime and restore our effectively destroy any hope of forging the Amendment, we would not be able to make neighborhood security. The Balanced Budget crucial federal-local partnerships that today good on the promises set forth in the crime Amendment will impede us in this effort at must form the basis of our crime prevention bill. We would be saying to the American the very time that it is needed most. Let us efforts, and destroy any hope of imple- people in the same breath that while we’re not make this mistake. menting our community policing and public serious about fighting crime, we won’t be Thank you for the opportunity to meet safety initiatives. In practical terms, the able to fund the essential programs nec- with you this morning and I’ll be happy to Balanced Budget Amendment would make it essary to win this battle. We can not—and answer any questions. impossible to meet the President’s budget we should not—send such conflicting mes- request to put up to 100,000 more police offi- sages to the American people. DEPARTMENT OF THE TREASURY, cers on the street by 1999. As you know, in By passing the Balanced Budget Amend- Washington, DC, January 12, 1995. order to increase in 1995 the financial assist- ment, we would be gutting the heart and soul Hon. HOWARD DEAN, M.D., ance to state and local law enforcement for of the Senate-passed Crime Bill: the 20 per- Chairman, National Governors’ Association, Of- purposes authorized in the Senate version of cent reduction required by the Amendment fice of the Governor, Montpelier, VT. the crime bill, the President has already would affect the Crime Control Fund like all DEAR GOVERNOR DEAN: I write to answer ‘‘bitten the bullet’’ and reallocated within other discretionary spending programs. For your request for information on the likely the discretionary spending ceiling in order to example, one of the most important initia- effects of passage of a balanced-budget support this new initiative. tives included in the Crime Bill is the provi- amendment, accompanied by ‘‘Contract with Yet eliminating all local and state assist- sion to hire 100,000 new police officers over America’’ federal tax reductions, on state ance measures—while a severe remedy in the next five years. America’s neighborhoods budgets and state taxes. itself—would account for only half of the desperately need these new cops; more cops Enclosed is a set of estimates that Treas- cutbacks required by the Balanced Budget on the streets, working hand-in glove in ury staff have constructed of the possible ef- Amendment. The Department would still their communities, means less crime. If fect on states and their finances of a con- have to eliminate approximately 11 percent passed today, the Balanced Budget Amend- stitutional amendment requiring the bal- of its total full-time staff funded by discre- ment will severely undercut our ability to ancing of the federal budget in 2002, accom- tionary programs. put these police in the communities where panied by the tax reductions mentioned If instead state and local assistance were they belong. above. These estimates are based on the fol- continued at a rate 20 percent below the cur- Just as important to our crime-fighting lowing assumptions: (I) that the federal rent level, we would need to cut approxi- plan is the decision to build boot camps. budget would be balanced through spending mately 20,000 full-time employees, or about These camps can give youths who have com- cuts, (II) that Social Security and Defense one-quarter of our entire full-time workstaff. mitted their first crime and who are at risk spending would not be reduced below base- If, on the other hand, we continued the of drug and gang involvement the discipline, line, and thus (III) that the entire burden of President’s commitment to fund 100,000 new education and training they need to grab an- balancing the federal budget would be placed police, and the Balanced Budget Amendment other chance for an honest life. If passed on non-interest, non-Social Security, non- were enacted today, the effect on the various today, the Balanced Budget Amendment, Defense spending, as proposed methods for Department components responsible for our however, would slash funds intended for balancing the budget and financing various crime prevention efforts would be cata- these camps, depriving many young offend- tax cuts excludes Social Security and De- strophic. The 20 percent reduction in our dis- ers of a chance at a new start on life. fense. cretionary spending from 1994 resources re- Similarly, drug-treatment and coerced ab- The estimates assume that every expendi- quired by the Amendment would mean: stinence programs for criminal offenders— ture—interest, Social Security, and Defense The Federal Bureau of Investigation (FBI) including residential substance abuse for aside—would be reduced relative to baseline would have to decrease its 1994 resources by prisoners—cornerstones of both the Crime by the same proportional amount. The esti- $412.1 million and eliminate 4387 positions, Bill and the President’s National Drug Con- mates assume that the deficit reduction will including approximately 1900 agents and 2500 trol Strategy, would not be possible under a be phased in gradually, an equal amount in support staff. The Drug Enforcement Admin- Balanced Budget Amendment. Nor could the each year between now and 2002. This ar- istration (DEA) would have to decrease its Bill’s plan to help support drug courts, drug rangement of the spending cuts results in total resources by $145.9 million and elimi- testing and certainty of punishment for substantial interest savings relative to the nate approximately 500 agents and 600 sup- young offenders be implemented under a Bal- baseline in 2002, and thus reduces the port staff. anced Budget Amendment. amount of non-interest spending that must The impact of this reduction on these pro- Tomorrow, Assistant Attorney General be cut in 2002 to balance the budget. grams would be devastating. At all levels of Walter Dellinger will testify before this Nevertheless, the cuts required in 2002 law enforcement, essential training pro- Committee on the potential impact of the would be severe. To help balance the budget grams and important task forces would be Balanced Budget Amendment on the struc- and help offset the tax reductions noted eliminated. In addition, DEA’s drug king-pin ture of the constitution, and I don’t want to above, federal grants to states would be cut strategy would be crippled. Most, if not all, duplicate what he will say. I do hope, how- by a total of $97.8 billion in fiscal 2002. Other of the DEA’s resident offices and posts of ever, that you will listen very carefully to federal spending that directly benefits state

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00020 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3159 residents would be cut by $242.2 billion in fis- the likely burdens on states is to assume Note, finally, that this set of estimates is cal 2002. across-the-board proportional cuts. far from being a complete analysis of a bal- The cuts in grants—in Medicaid, highway Note, also, that these estimates do not in- anced-budget amendment. Its principal func- corporate any significant feedback effects: it funds, AFDC, and other grants—and the cuts tion is to identify and evaluate the approxi- is possible that shifts in monetary policy in other spending—on Medicare and on other would not be able to fully offset the down- mate impact on state government finances of spending—were distributed across states pro- ward macroeconomic impact of a balanced- a constitutional amendment that requires portionately to current levels of federal ex- budget amendment. To the extent that im- federal budget balance by 2002. penditures. Also reported is the amount by plementation of an amendment slows growth Sincerely yours, which total state taxes would have to be and reduces state revenues, the gap would be JOYCE CARRIER, raised if the state wished to fully offset the somewhat larger and the effect on state fi- Deputy Assistant Secretary reduction in federal grants. nances somewhat more severe. On the other for Public Liaison. Grants to states in the aggregate, to spe- hand, balancing the federal budget could cific states, and to states for specific pro- have substantial positive effects on the U.S. grams may be cut by more or by less than economy, which would promise to raise state THE IMPACT OF A BALANCED-BUDGET AMEND- projected here. Yet, without further detail, revenues as state economic activity in- MENT AND THE CONTRACT WITH AMERICA ON the most reasonable method for illustrating creased. Such effects are not discussed here. STATE FINANCES TABLE 1.—SPENDING REDUCTIONS UNDER BALANCED BUDGET AMENDMENT [Fiscal year 2002, Millions of dollars]

Cuts in grants to State Government Required Cuts in other Federal spending State tax State increase Total Medicaid Highway AFDC Other (percent) Total Medicare Other

U.S. total ...... 71,300 40,314 5,176 4,508 21,301 N.A. 176,492 77,475 99,017

Alabama ...... 1,162 641 98 32 391 16.4 3,058 1,157 1,900 Alaska ...... 306 89 71 19 127 9.8 576 44 532 Arizona ...... 919 519 78 68 254 10.4 2,397 949 1,447 Arkansas ...... 723 416 65 16 225 16.5 1,567 766 800 California ...... 7,708 3,944 442 960 2,362 9.2 20,321 9,101 11,220 Colorado ...... 755 387 79 36 253 11.8 2,764 721 2,044 Connecticut ...... 1,008 587 105 63 253 11.2 1,843 1,089 755 Delaware ...... 158 70 18 9 61 7.2 383 176 207 DC ...... 697 183 17 24 473 20.4 4,937 313 4,624 Florida ...... 2,656 1,520 202 170 764 10.2 9,782 5,336 4,446 Georgia ...... 1,608 938 131 101 438 12.0 3,790 1,392 2,398 Hawaii ...... 328 117 62 24 125 6.8 737 216 522 Idaho ...... 254 118 33 8 95 9.9 855 218 637 Illinois ...... 2,576 1,354 174 155 892 11.6 7,532 4,092 3,441 Indiana ...... 1,490 956 123 54 357 13.8 2,531 1,497 1,034 Iowa ...... 630 328 69 35 197 10.9 1,919 897 1,022 Kansas ...... 622 355 52 29 186 13.0 1,730 819 911 Kentucky ...... 1,157 690 69 56 341 14.5 2,111 952 1,159 Louisiana ...... 1,966 1,500 94 48 324 27.8 2,361 1,066 1,296 Maine ...... 452 279 28 24 121 17.5 717 385 331 Maryland ...... 1,125 581 83 65 396 9.9 6,253 1,377 4,876 Massachusetts ...... 1,915 1,073 248 135 459 12.6 4,683 2,449 2,234 Michigan ...... 2,477 1,355 140 229 753 13.2 4,988 3,333 1,655 Minnesota ...... 1,177 679 102 83 314 9.4 2,547 1,123 1,424 Mississippi ...... 864 496 61 24 282 20.8 1,672 713 959 Missouri ...... 1,316 747 109 62 398 15.5 3,942 1,781 2,161 Montana ...... 277 123 52 12 89 19.8 744 218 526 Nebraska ...... 388 192 44 23 129 13.3 1,213 482 732 Nevada ...... 227 116 32 11 68 6.2 1,005 258 747 New Hampshire ...... 212 112 31 11 58 17.6 563 270 293 New Jersey ...... 2,476 1,500 141 129 705 12.7 4,653 2,894 1,759 New Mexico ...... 524 233 70 28 193 12.9 2,117 321 1,796 New York ...... 8,181 5,442 274 535 1,930 17.4 11,058 6,876 4,182 North Carolina ...... 1,697 1,025 136 95 441 11.1 3,217 1,432 1,785 North Dakota ...... 229 105 35 8 81 19.7 563 231 332 Ohio ...... 2,826 1,718 170 212 727 14.4 6,007 3,442 2,565 Oklahoma ...... 770 424 51 51 244 12.4 2,110 934 1,177 Oregon ...... 706 342 54 47 263 12.2 1,976 833 1,143 Pennsylvania ...... 3,057 1,767 211 178 901 12.7 8,555 5,120 3,435 Rhode Island ...... 430 255 42 23 109 21.4 619 347 272 South Carolina ...... 1,003 644 68 31 260 14.3 2,217 682 1,535 South Dakota ...... 231 103 39 6 82 24.7 577 205 372 Tennessee ...... 1,537 989 78 60 411 19.5 3,845 1,349 2,496 Texas ...... 4,167 2,520 340 147 1,159 14.0 10,758 4,280 6,479 Utah ...... 422 190 49 22 160 11.4 1,078 235 842 Vermont ...... 207 89 37 13 68 17.4 301 150 151 Virginia ...... 1,005 490 72 49 393 8.2 6,073 1,374 4,699 Washington ...... 1,318 730 117 126 346 8.4 3,569 1,107 2,463 West Virginia ...... 765 488 45 32 199 20.6 1,209 600 608 Wisconsin ...... 1,250 694 111 96 349 10.3 2,480 1,503 977 Wyoming ...... 218 55 38 8 118 18.7 286 96 191 State total: ...... 70,172 40,271 5,093 4,480 20,328 12.6 172,792 77,199 95,593 Undist. & Terr...... 1,127 43 83 28 973 N.A. 3,700 276 3,424

TABLE 2.—SPENDING REDUCTIONS UNDER CONTRACT WITH AMERICA [Fiscal year, millions of dollars]

Cuts in grants to State Governments Required Cuts in other Federal spending State tax State increase Total Medicaid Highway AFDC Other (percent) Total Medicare Other

U.S. total ...... 97,825 55,312 7,102 6,185 29,226 N.A. 242,151 106,298 135,854

Alabama ...... 1,594 879 135 44 536 22.5 4,195 1,588 2,608 Alaska ...... 420 123 98 26 174 13.5 790 60 730 Arizona ...... 1,261 712 108 93 348 14.2 3,288 1,302 1,986 Arkansas ...... 992 571 90 23 309 22.7 2,150 1,052 1,098 California ...... 10,576 5,412 607 1,317 3,241 12.6 27,880 12,486 15,394 Colorado ...... 1,036 531 108 49 347 16.2 3,793 989 2,804 Connecticut ...... 1,383 805 145 86 348 15.4 2,529 1,494 1,035 Delaware ...... 217 97 25 12 83 9.8 526 241 284 DC ...... 956 252 23 32 650 27.9 6,774 429 6,345 Florida ...... 3,644 2,086 277 233 1,048 14.0 13,421 7,321 6,100 Georgia ...... 2,206 1,286 180 138 601 16.5 5,200 1,910 3,290 Hawaii ...... 450 161 85 32 172 9.3 1,012 296 716 Idaho ...... 349 162 46 11 131 13.6 1,173 299 874 Illinois ...... 3,534 1,858 239 213 1,224 15.9 10,334 5,614 4,721 Indiana ...... 2,044 1,312 168 74 490 18.9 3,473 2,054 1,419

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00021 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3160 CONGRESSIONAL RECORD — SENATE February 27, 1995 TABLE 2.—SPENDING REDUCTIONS UNDER CONTRACT WITH AMERICA—Continued [Fiscal year, millions of dollars]

Cuts in grants to State Governments Required Cuts in other Federal spending State tax State increase Total Medicaid Highway AFDC Other (percent) Total Medicare Other

Iowa ...... 864 451 95 48 270 15.0 2,633 1,231 1,402 Kansas ...... 853 487 71 40 255 17.8 2,374 1,124 1,249 Kentucky ...... 1,587 947 95 77 468 19.8 2,896 1,306 1,590 Louisiana ...... 2,697 2,059 129 66 444 38.2 3,240 1,462 1,778 Maine ...... 621 383 38 33 166 24.0 983 529 454 Maryland ...... 1,543 798 113 89 543 13.5 8,579 1,889 6,690 Massachusetts ...... 2,627 1,472 340 185 630 17.3 6,425 3,360 3,065 Michigan ...... 3,398 1,859 192 314 1,034 18.1 6,844 4,572 2,271 Minnesota ...... 1,615 931 139 113 431 13.0 3,494 1,541 1,954 Mississippi ...... 1,185 681 84 33 387 28.5 2,294 978 1,316 Missouri ...... 1,806 1,025 149 85 547 21.2 5,408 2,444 2,965 Montana ...... 380 169 71 17 123 27.1 1,021 298 722 Nebraska ...... 533 264 60 31 177 18.3 1,665 661 1,004 Nevada ...... 312 159 44 15 94 8.6 1,379 354 1,025 New Hampshire ...... 291 154 43 16 79 24.1 773 370 403 New Jersey ...... 3,397 2,059 194 177 968 17.5 6,384 3,971 2,413 New Mexico ...... 719 320 96 38 265 17.6 2,904 440 2,464 New York ...... 11,225 7,466 376 734 2,649 23.8 15,172 9,435 5,738 North Carolina ...... 2,329 1,406 187 130 605 15.2 4,414 1,965 2,449 North Dakota ...... 314 144 48 10 111 27.0 773 317 455 Ohio ...... 3,878 2,358 233 290 997 19.8 8,242 4,722 3,520 Oklahoma ...... 1,056 582 70 69 335 17.0 2,896 2,281 1,615 Oregon ...... 969 469 75 65 361 16.8 2,711 1,143 1,568 Pennsylvania ...... 4,194 2,424 290 244 1,237 17.4 11,738 7,025 4,713 Rhode Island ...... 590 350 58 32 150 29.3 849 476 373 South Carolina ...... 1,376 883 94 42 357 19.6 3,042 935 2,106 South Dakota ...... 316 142 53 9 113 33.8 792 281 511 Tennessee ...... 2,109 1,357 107 82 563 26.7 5,275 1,850 3,425 Texas ...... 5,717 3,457 466 202 1,591 19.2 14,761 5,872 8,889 Utah ...... 579 261 68 31 220 15.6 1,479 323 1,156 Vermont ...... 284 122 51 18 93 23.9 413 206 207 Virginia ...... 1,379 673 99 68 539 11.2 8,332 1,885 6,447 Washington ...... 1,809 1,001 161 172 474 11.5 4,897 1,518 3,379 West Virginia ...... 1,049 670 62 44 273 28.3 1,658 824 835 Wisconsin ...... 1,716 952 153 132 479 14.2 3,402 2,062 1,340 Wyoming ...... 300 75 52 10 162 25.7 393 131 262 State total ...... 96,278 55,253 6,988 6,147 27,891 17.3 237,075 105,919 131,155 Undist. & Terr...... 1,547 59 114 38 1,335 N.A. 5,077 378 4,698

THE IMPACT OF A BALANCED BUDGET AMEND- THE IMPACT OF A BALANCED BUDGET AMEND- THE IMPACT OF A BALANCED BUDGET AMEND- MENT AND THE CONTRACT WITH AMERICA ON MENT AND THE CONTRACT WITH AMERICA ON MENT AND THE CONTRACT WITH AMERICA ON THE STATE OF ALABAMA 1 THE STATE OF ALASKA THE STATE OF ARIZONA I. A Balanced Budget Amendment would I. A Balanced Budget Amendment would I. A Balanced Budget Amendment would reduce annual Federal grants to the Ala- reduce annual Federal grants to the Alaska reduce annual Federal grants to the Arizona bama state government by $1.2 billion. state government by $306 million. state government by $919 million. $641 million per year in lost funding for Medicaid. $89 million per year in lost funding for $519 million per year in lost funding for $98 million per year in lost highway trust Medicaid. Medicaid. fund grants. $71 million per year in lost highway trust $78 million per year in lost highway trust $32 million per year in lost funding for wel- fund grants. fund grants. fare (AFDC). $19 million per year in lost funding for wel- $68 million per year in lost funding for wel- $391 million per year in lost funding for fare (AFDC). fare (AFDC). education, job training, the environment, $127 million per year in lost funding for $254 million per year in lost funding for housing, and other areas. education, job training, the environment, education, job training, the environment, Alabama would have to increase state housing, and other areas. housing, and other areas. taxes by 16.4 percent across-the-board to make up for the loss in grants. Alaska would have to increase state taxes Arizona would have to increase state taxes II. A Balanced Budget Amendment com- by 9.8 percent across-the-board to make up by 10.4 percent across-the-board to make up bined with the ‘‘Contract with America’’ tax for the loss in grants. for the loss in grants. cuts would require even deeper spending II. A Balanced Budget Amendment com- II. A Balanced Budget Amendment com- cuts, thereby reducing annual Federal grants bined with the ‘‘Contract with America’’ tax bined with the ‘‘Contract with America’’ tax to the Alabama state government by $1.6 bil- cuts would require even deeper spending cuts would require even deeper spending lion. cuts, thereby reducing annual Federal grants cuts, thereby reducing annual Federal grants $879 million per year in lost funding for to the Alaska state government by $420 mil- to the Arizona state government by $1.3 bil- Medicaid. lion. lion. $135 million per year in lost highway trust $123 million per year in lost funding for $712 million per year in lost funding for fund grants. Medicaid. Medicaid. $44 million per year in lost funding for wel- $98 million per year in lost highway trust $108 million per year in lost highway trust fare (AFDC). fund grants. fund grants. $536 million per year in lost funding for education, job training, the environment, $26 million per year in lost funding for wel- $93 million per year in lost funding for wel- housing, and other areas. fare (AFDC). fare (AFDC). Alabama would have to increase state $174 million per year in lost funding for $348 million per year in lost funding for taxes by 22.5 percent across-the-board to education, job training, the environment, education, job training, the environment, make up for the loss in grants. housing, and other areas. housing, and other areas. III. A Balanced Budget Amendment and Alaska would have to increase state taxes Arizona would have to increase state taxes the ‘‘Contract with America’’ tax cuts would by 13.5 percent across-the-board to make up by 14.2 percent across-the-board to make up reduce other annual Federal spending in Ala- for the loss in grants. for the loss in grants. bama by $4.2 billion. III. A Balanced Budget Amendment and III. A Balanced Budget Amendment and $1.6 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would the ‘‘Contract with America’’ tax cuts would $2.6 billion per year in other spending in- reduce other annual Federal spending in reduce other annual Federal spending in Ari- cluding housing assistance, student loans, Alaska by $790 million. zona by $3.3 billion. veteran’s benefits, and grants to local gov- ernments. $60 million per year in Medicare benefits. $1.3 billion per year in Medicare benefits. $730 million per year in other spending in- $2.0 billion per year in other spending in- 1 For all calculations, a balanced budget is cluding housing assistance, student loans, cluding housing assistance, student loans, achieved by FY 2002 through across-the-board spend- veteran’s benefits, and grants to local gov- veteran’s benefits, and grants to local gov- ing cuts that exclude defense and social security. ernments. ernments.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00022 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3161

THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- $1.5 billion per year in Medicare benefits. MENT AND THE CONTRACT WITH AMERICA ON ernments. $1.0 billion per year in other spending in- THE STATE OF ARKANSAS THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- reduce annual Federal grants to the Arkan- THE STATE OF COLORADO ernments. sas state government by $723 million. I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- $416 million per year in lost funding for reduce annual Federal grants to the Colo- MENT AND THE CONTRACT WITH AMERICA ON Medicaid. rado state government by $755 million. THE STATE OF DELAWARE $65 million per year in lost highway trust $387 million per year in lost funding for I. A Balanced Budget Amendment would fund grants. Medicaid. $16 million per year in lost funding for wel- reduce annual Federal grants to the Dela- $79 million per year in lost highway trust ware state government by $158 billion. fare (AFDC). fund grants. $225 million per year in lost funding for $70 million per year in lost funding for $36 million per year in lost funding for wel- Medicaid. education, job training, the environment, fare (AFDC). housing, and other areas. $18 million per year in lost highway trust $253 million per year in lost funding for fund grants. Arkansas would have to increase state education, job training, the environment, $9 million per year in lost funding for wel- taxes by 16.5 percent across-the-board to housing, and other areas. fare (AFDC). make up for the loss in grants. Colorado would have to increase state $61 million per year in lost funding for edu- II. A Balanced Budget Amendment com- taxes by 11.8 percent across-the-board to cation, job training, the environment, hous- bined with the ‘‘Contract with America’’ tax make up for the loss in grants. ing, and other areas. cuts would require even deeper spending II. A Balanced Budget Amendment com- cuts, thereby reducing annual Federal grants bined with the ‘‘Contract with America’’ tax Delaware would have to increase state to the Arkansas state government by $992 cuts would require even deeper spending taxes by 7.2 percent across-the-board to million. cuts, thereby reducing annual Federal grants make up for the loss in grants. $571 million per year in lost funding for to the Colorado state government by $1.0 bil- II. A Balanced Budget Amendment com- Medicaid. lion. bined with the ‘‘Contract with America’’ tax $90 million per year in lost highway trust $531 million per year in lost funding for cuts would require even deeper spending fund grants. Medicaid. cuts, thereby reducing annual Federal grants $23 million per year in lost funding for wel- $108 million per year in lost highway trust to the Delaware state government by $217 fare (AFDC). fund grants. million. $309 million per year in lost funding for $49 million per year in lost funding for wel- $97 million per year in lost funding for education, job training, the environment, fare (AFDC). Medicaid. housing, and other areas. $347 million per year in lost funding for $25 million per year in lost highway trust Arkansas would have to increase state education, job training, the environment, fund grants. taxes by 22.7 percent across-the-board to housing, and other areas. $12 million per year in lost funding for wel- make up for the loss in grants. fare (AFDC). III. A Balanced Budget Amendment and Colorado would have to increase state $83 million per year in lost funding for edu- the ‘‘Contract with America’’ tax cuts would taxes by 16.2 percent across-the-board to cation, job training, the environment, hous- reduce other annual Federal spending in Ar- make up for the loss in grants. III. A Balanced Budget Amendment and ing, and other areas. kansas by $2.1 billion. $1.1 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would Delaware would have to increase state $1.1 billion per year in other spending in- reduce other annual Federal spending in Col- taxes by 9.8 percent across-the-board to cluding housing assistance, student loans, orado by $3.8 billion. make up for the loss in grants. veteran’s benefits, and grants to local gov- $989 million per year in Medicare benefits. III. A Balanced Budget Amendment and ernments. $2.8 billion per year in other spending in- the ‘‘Contract with America’’ tax cuts would cluding housing assistance, student loans, reduce other annual Federal spending in THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- Delaware by $526 million. MENT AND THE CONTRACT WITH AMERICA ON ernments. $241 million per year in Medicare benefits. THE STATE OF CALIFORNIA THE IMPACT OF A BALANCED BUDGET AMEND- $284 million per year in other spending in- I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON cluding housing assistance, student loans, reduce annual Federal grants to the Cali- THE STATE OF CONNECTICUT veterans’ benefits, and grants to local gov- fornia state government by $7.7 billion. ernments. $3.9 billion per year in lost funding for I. A Balanced Budget Amendment would Medicaid. reduce annual Federal grants to the Con- THE IMPACT OF A BALANCED BUDGET AMEND- $442 million per year in lost highway trust necticut state government by $1.0 billion. MENT AND THE CONTRACT WITH AMERICA ON fund grants. $587 million per year in lost funding for THE DISTRICT OF COLUMBIA $960 million per year in lost funding for Medicaid. I. A Balanced Budget Amendment would welfare (AFDC). $105 million per year in lost highway trust reduce annual Federal grants to the D.C. $2.4 billion per year in lost funding for edu- fund grants. government by $697 million. cation, job training, the environment, hous- $63 million per year in lost funding for wel- $183 million per year in lost funding for ing, and other areas. fare (AFDC). Medicaid. $253 million per year in lost funding for California would have to increase state $17 million per year in lost highway trust education, job training, the environment, taxes by 9.2 percent across-the-board to fund grants. housing, and other areas. make up for the loss in grants. $24 million per year in lost funding for wel- Connecticut would have to increase state II. A Balanced Budget Amendment com- fare (AFDC). taxes by 11.2 percent across-the-board to bined with the ‘‘Contract with America’’ tax $473 million per year in lost funding for cuts would require even deeper spending make up for the loss in grants. II. A Balanced Budget Amendment com- education, job training, the environment, cuts, thereby reducing annual Federal grants housing, and other areas. to the California state government by $10.6 bined with the ‘‘Contract with America’’ tax cuts would require even deeper spending D.C. would have to increase state taxes by billion. 20.4 percent across-the-board to make up for $5.4 billion per year in lost funding for cuts, thereby reducing annual Federal grants the loss in grants. Medicaid. to the Connecticut state government by $1.4 II. A Balanced Budget Amendment com- $607 million per year in lost highway trust billion. bined with the ‘‘Contract with America’’ tax fund grants. $805 million per year in lost funding for $1.3 billion per year in lost funding for wel- Medicaid. cuts would require even deeper spending fare (AFDC). $145 million per year in lost highway trust cuts, thereby reducing annual Federal grants $3.2 billion per year in lost funding for edu- fund grants. to the D.C. government by $956 million. cation, job training, the environment, hous- $86 million per year in lost funding for wel- $252 million per year in lost funding for ing, and other areas. fare (AFDC). Medicaid. California would have to increase state $348 million per year in lost funding for $23 million per year in lost highway trust taxes by 12.6 percent across-the-board to education, job training, the environment, fund grants. make up for the loss in grants. housing, and other areas. $32 million per year in lost funding for wel- III. A Balanced Budget Amendment and Connecticut would have to increase state fare (AFDC). the ‘‘Contract with America’’ tax cuts would taxes by 15.4 percent across-the-board to $650 million per year in lost funding for reduce other annual Federal spending in make up for the loss in grants. education, job training, the environment, California by $27.9 billion. III. A Balanced Budget Amendment and housing, and other areas. $12.5 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would D.C. would have to increase state taxes by $15.4 billion per year in other spending in- reduce other annual Federal spending in 27.9 percent across-the-board to make up for cluding housing assistance, student loans, Connecticut by $2.5 billion. the loss in grants.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00023 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3162 CONGRESSIONAL RECORD — SENATE February 27, 1995 III. A Balanced Budget Amendment and Georgia would have to increase state taxes $131 million per year in lost funding for the ‘‘Contract with America’’ tax cuts would by 16.5 percent across-the-board to make up education, job training, the environment, reduce other annual Federal spending in DC for the loss in grants. housing, and other areas. by $6.8 billion. III. A Balanced Budget Amendment and Idaho would have to increase state taxes $429 million per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would by 13.6 percent across-the-board to make up $6.3 billion per year in other spending in- reduce other annual Federal spending in for the loss in grants. cluding housing assistance, student loans, Georgia by $5.2 billion. III. A Balanced Budget Amendment and veterans’ benefits, and grants to local gov- $1.9 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would ernments. $3.3 billion per year in other spending in- reduce other annual Federal spending in THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, Idaho by $1.2 billion. MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- $299 million per year in Medicare benefits. THE STATE OF FLORIDA ernments. $874 million per year in other spending in- cluding housing assistance, student loans, I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- reduce annual Federal grants to the Florida MENT AND THE CONTRACT WITH AMERICA ON ernments. state government by $2.7 billion. THE STATE OF HAWAII $1.5 billion per year in lost funding for I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- Medicaid. reduce annual Federal grants to the Hawaii MENT AND THE CONTRACT WITH AMERICA ON $202 million per year in lost highway trust state government by $328 million. THE STATE OF ILLINOIS fund grants. $117 million per year in lost funding for I. A Balanced Budget Amendment would $170 million per year in lost funding for Medicaid. reduce annual Federal grants to the Illinois welfare (AFDC). $62 million per year in lost highway trust state government by $2.6 billion. $764 million per year in lost funding for fund grants. $1.4 billion per year in lost funding for education, job training, the environment, $24 million per year in lost funding for wel- Medicaid. housing, and other areas. fare (AFDC). $174 million per year in lost highway trust Florida would have to increase state taxes $125 million per year in lost funding for fund grants. by 10.2 percent across-the-board to make up education, job training, the environment, $155 million per year in lost funding for for the loss in grants. housing, and other areas. welfare (AFDC). II. A Balanced Budget Amendment com- Hawaii would have to increase state taxes $892 million per year in lost funding for bined with the ‘‘Contract with America’’ tax by 6.8 percent across-the-board to make up education, job training, the environment, cuts would require even deeper spending for the loss in grants. housing, and other areas. cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- Illinois would have to increase state taxes to the Florida state government by $3.6 bil- bined with the ‘‘Contract with America’’ tax by 11.6 percent across-the-board to make up lion. cuts would require even deeper spending for the loss in grants $2.1 billion per year in lost funding for cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- Medicaid. to the Hawaii state government by $450 mil- bined with the ‘‘Contract with America’’ tax $277 million per year in lost highway trust lion. cuts would require deeper spending cuts, fund grants. $161 million per year in lost funding for thereby reducing annual Federal grants to $233 million per year in lost funding for Medicaid. the Illinois state government by $3.5 billion. welfare (AFDC). $85 million per year in lost highway trust $1.9 billion per year in lost funding for $1.0 billion per year in lost funding for edu- fund grants. Medicaid. cation, job training, the environment, hous- $32 million per year in lost funding for wel- $239 million per year in lost highway trust ing, and other areas. fare (AFDC). fund grants. Florida would have to increase state taxes $172 million per year in lost funding for $213 million per year in lost funding for by 14.0 percent across-the-board to make up education, job training, the environment, welfare (AFDC). for the loss in grants. housing, and other areas. $1.2 billion per year in lost funding for edu- III. A Balanced Budget Amendment and Hawaii would have to increase state taxes cation, job training, the environment, hous- the ‘‘Contract with America’’ tax cuts would by 9.3 percent across-the-board to make up ing, and other areas. reduce other annual Federal spending in for the loss in grants. Illinois would have to increase state taxes Florida by $13.4 billion. III. A Balanced Budget Amendment and by 15.9 percent across-the-board to make up $7.3 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would for the loss in grants. $6.1 billion per year in other spending in- reduce other annual Federal spending in Ha- III. A Balanced Budget Amendment and cluding housing assistance, student loans, waii by $1.0 billion. the ‘‘Contract with America’’ tax cuts would veterans’ benefits, and grants to local gov- $296 million per year in Medicare benefits. reduce other annual Federal spending in Illi- ernments. $716 million per year in other spending in- nois by $10.3 billion. THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, $5.6 billion per year in Medicare benefits. MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- $4.7 billion per year in other spending in- THE STATE OF GEORGIA ernments. cluding housing assistance, student loans, veterans’ benefits, and grants to local gov- I. A A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- ernments. reduce annual Federal grants to the Georgia MENT AND THE CONTRACT WITH AMERICA ON state government by $1.6 billion. THE STATE OF IDAHO THE IMPACT OF A BALANCED BUDGET AMEND- $938 million per year in lost funding for I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON Medicaid. reduce annual Federal grants to the Idaho THE STATE OF INDIANA $131 million per year in lost highway trust state government by $254 million. I. A Balanced Budget Amendment would fund grants. $118 million per year in lost funding for reduce annual grants to the Indiana state $101 million per year in lost funding for Medicaid. government by $1.5 billion. welfare (AFDC). $33 million per year in lost highway trust $956 million per year in lost funding for $438 million per year in lost funding for fund grants. Medicaid. education, job training, the environment, $8 million per year in lost funding for wel- $123 million per year in lost highway trust housing, and other areas. fare (AFDC). fund grants. Georgia would have to increase state taxes $95 million per year in lost funding for edu- $54 million per year in lost funding for wel- by 12.0 percent across-the-board to make up cation, job training, the environment, hous- fare (AFDC). for the loss in grants. ing, and other areas. $357 million per year in lost funding for II. A Balanced Budget Amendment com- Idaho would have to increase state taxes education, job training, the environment, bined with the ‘‘Contract with America’’ tax by 9.9 percent across-the-board to make up housing, and other areas. cuts would require even deeper spending for the loss in grants Indiana would have to increase state taxes cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- by 13.8 percent across-the-board to make up to the Georgia state government by $2.2 bil- bined with the ‘‘Contract with America’’ tax for the loss in grants lion. cuts would require even deeper spending II. A Balanced Budget Amendment com- $1.3 billion per year in lost funding for cuts, thereby reducing annual Federal grants bined with the ‘‘Contract with America’’ tax Medicaid. to the Idaho state government by $349 mil- cuts would require even deeper spending $180 million per year in lost highway trust lion. cuts, thereby reducing annual Federal grants fund grants. $162 million per year in lost funding for to the Indiana state government by $2.0 bil- $138 million per year in lost funding for Medicaid. lion. welfare (AFDC). $46 million per year in lost highway trust $1.3 billion per year in lost funding for $601 million per year in lost funding for fund grants. Medicaid. education, job training, the environment, $11 million per year in lost funding for wel- $168 million per year in lost highway trust housing, and other areas. fare (AFDC). fund grants.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00024 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3163 $74 million per year in lost funding for wel- $71 million per year in lost highway trust $2.1 billion per year in lost funding for fare (AFDC). fund grants. Medicaid. $490 million per year in lost funding for $40 million per year in lost funding for wel- $129 million per year in lost highway trust education, job training, the environment, fare (AFDC). fund grants. housing, and other areas. $255 million per year in lost funding for $66 million per year in lost funding for wel- Indiana would have to increase state taxes education, job training, the environment, fare (AFDC). by 18.9 percent across-the-board to make up housing, and other areas. $444 million per year in lost funding for for the loss in grants. Kansas would have to increase state taxes education, job training, the environment, III. A Balanced Budget Amendment and by 17.8 percent across-the-board to make up housing, and other areas. the ‘‘Contract with America’’ tax cuts would for the loss in grants. Louisiana would have to increase state III. A Balanced Budget Amendment and reduce other annual Federal spending in In- taxes by 38.2 percent across-the-board to the ‘‘Contract with America’’ tax cuts would diana by $3.5 billion. make up for the loss in grants. reduce other annual Federal spending in $2.1 billion per year in Medicare benefits. III. A Balanced Budget Amendment and Kansas by $2.4 billion. $1.4 billion per year in other spending in- the ‘‘Contract with America’’ tax cuts would cluding housing assistance, student loans, $1.1 billion per year in Medicare benefits. $1.2 billion per year in other spending in- reduce other annual Federal spending in veterans’ benefits, and grants to local gov- Louisiana by $3.2 billion. ernments. cluding housing assistance, student loans, veterans’ benefits, and grants to local gov- $1.5 billion per year in Medicare benefits. THE IMPACT OF A BALANCED BUDGET AMEND- ernments. $1.8 billion per year in other spending in- MENT AND THE CONTRACT WITH AMERICA ON cluding housing assistance, student loans, THE IMPACT OF A BALANCED BUDGET AMEND- THE STATE OF IOWA veterans’ benefits, and grants to local gov- MENT AND THE CONTRACT WITH AMERICA ON I. A Balanced Budget Amendment would ernments. THE STATE OF KENTUCKY reduce annual Federal grants to the Iowa THE IMPACT OF A BALANCED BUDGET AMEND- state government by $630 million. I. A Balanced Budget Amendment would reduce annual Federal grants to the Ken- MENT AND THE CONTRACT WITH AMERICA ON $328 million per year in lost funding for THE STATE OF MAINE Medicaid. tucky state government by $1.2 billion. $69 million per year in lost highway trust $690 million per year in lost funding for I. A Balanced Budget Amendment would fund grants. Medicaid. reduce annual Federal grants to the Maine $35 million per year in lost funding for wel- $69 million per year in lost highway trust state government by $452 million. fare (AFDC). fund grants. $279 million per year in lost funding for $197 million per year in lost funding for $56 million per year in lost funding for wel- Medicaid. education, job training, the environment, fare (AFDC). $28 million per year in lost highway trust $341 million per year in lost funding for housing, and other areas. fund grants. education, job training, the environment, Iowa would have to increase state taxes by $24 million per year in lost funding for wel- housing, and other areas. 10.9 percent across-the-board to make up for fare (AFDC). Kentucky would have to increase state the loss in grants. $121 million per year in lost funding for taxes by 14.5 percent across-the-board to II. A Balanced Budget Amendment com- education, job training, the environment, make up for the loss in grants. bined with the ‘‘Contract with America’’ tax housing, and other areas. II. A Balanced Budget Amendment com- cuts would require even deeper spending Maine would have to increase state taxes bined with the ‘‘Contract with America’’ tax cuts, thereby reducing annual Federal grants by 17.5 percent across-the-board to make up cuts would requre even deeper spending cuts, to the Iowa state government by $864 mil- for the loss in grants. thereby reducing annual Federal grants to lion. II. A Balanced Budget Amendment com- the Kentucky state government by $1.6 bil- $451 million per year in lost funding for bined with the ‘‘Contract with America’’ tax lion. Medicaid. $947 million per year in lost funding for cuts would requre even deeper spending cuts, $95 million per year in lost highway trust Medicaid. thereby reducing annual Federal grants to fund grants. $95 million per year in lost highway trust the Maine state government by $621 million. $48 million per year in lost funding for wel- fund grants. $383 million per year in lost funding for fare (AFDC). $77 million per year in lost funding for wel- Medicaid. $270 million per year in lost funding for fare (AFDC). $38 million per year in lost highway trust education, job training, the environment, $468 million per year in lost funding for fund grants. housing, and other areas. education, job training, the environment, $33 million per year in lost funding for wel- Iowa would have to increase state taxes by housing, and other areas. fare (AFDC). 15.0 percent across-the-board to make up for Kentucky would have to increase state $166 million per year in lost funding for the loss in grants. taxes by 19.8 percent across-the-board to education, job training, the environment, III. A Balanced Budget Amendment and make up for the loss in grants. housing, and other areas. the ‘‘Contract with America’’ tax cuts would III. A Balanced Budget Amendment and Maine would have to increase state taxes reduce other annual Federal spending in the ‘‘Contract with America’’ tax cuts would by 17.8 percent across-the-board to make up Iowa by $2.6 billion. reduce other annual Federal spending in for the loss in grants. $1.2 billion per year in Medicare benefits. Kentucky by $2.9 billion. III. A Balanced Budget Amendment and $1.4 billion per year in other spending in- $1.3 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would cluding housing assistance, student loans, $1.6 billion per year in other spending in- reduce other annual Federal spending in veterans’ benefits, and grants to local gov- cluding housing assistance, student loans, Maine by $983 million. ernments. veterans’ benefits, and grants to local gov- $529 million per year in Medicare benefits. THE IMPACT OF A BALANCED BUDGET AMEND- ernments. $454 million per year in other spending in- MENT AND THE CONTRACT WITH AMERICA ON THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, THE STATE OF KANSAS MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- I. A Balanced Budget Amendment would THE STATE OF LOUISIANA ernments. reduce annual Federal grants to the Kansas I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- state government by $622 million. reduce annual Federal grants to the Lou- MENT AND THE CONTRACT WITH AMERICA ON $355 million per year in lost funding for isiana state government by $2.0 billion. THE STATE OF MARYLAND Medicaid. $1.5 billion per year in lost funding for I. A Balanced Budget Amendment would $52 million per year in lost highway trust Medicaid. fund grants. $94 million per year in lost highway trust reduce annual Federal grants to the Mary- $29 million per year in lost funding for wel- fund grants. land state government by $1.1 billion. fare (AFDC). $48 million per year in lost funding for wel- $581 million per year in lost funding for $186 million per year in lost funding for fare (AFDC). Medicaid. education, job training, the environment, $324 million per year in lost funding for $83 million per year in lost highway trust housing, and other areas. education, job training, the environment, fund grants. Kansas would have to increase state taxes housing, and other areas. $65 million per year in lost funding for wel- by 13.0 percent across-the-board to make up Louisiana would have to increase state fare (AFDC). for the loss in grants. taxes by 27.8 percent across-the-board to $396 million per year in lost funding for II. A Balanced Budget Amendment com- make up for the loss in grants. education, job training, the environment, bined with the ‘‘Contract with America’’ tax II. A Balanced Budget Amendment com- housing, and other areas. cuts would requre even deeper spending cuts, bined with the ‘‘Contract with America’’ tax Maryland would have to increase state thereby reducing annual Federal grants to cuts would requre even deeper spending cuts, taxes by 9.9 percent across-the-board to the Kansas state government by $853 million. thereby reducing annual Federal grants to make up for the loss in grants. $487 million per year in lost funding for the Louisiana state government by $2.7 bil- II. A Balanced Budget Amendment com- Medicaid. lion. bined with the ‘‘Contract with America’’ tax

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00025 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3164 CONGRESSIONAL RECORD — SENATE February 27, 1995 cuts would require even deeper spending II. A Balanced Budget Amendment com- Mississippi would have to increase state cuts, thereby reducing annual Federal grants bined with the ‘‘Contract with America’’ tax taxes by 20.8 percent across-the-board to to the Maryland state government by $1.5 cuts would require even deeper spending make up for the loss in grants. billion. cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- $798 million per year in lost funding for to the Michigan state government by $3.4 bil- bined with the ‘‘Contract with America’’ tax Medicaid. lion. cuts would require even deeper spending $113 million per year in lost highway trust $1.9 billion per year in lost funding for cuts, thereby reducing annual Federal grants fund grants. Medicaid. to the Mississippi state government by $1.2 $89 million per year in lost funding for wel- $192 million per year in lost highway trust billion. fare (AFDC). fund grants. $681 million per year in lost funding for $543 million per year in lost funding for $314 million per year in lost funding for Medicaid. education, job training, the environment, welfare (AFDC). $84 million per year in lost highway trust housing, and other areas. $1.0 billion per year in lost funding for edu- fund grants. Maryland would have to increase state cation, job training, the environment, hous- taxes by 13.5 percent across-the-board to ing, and other areas. $33 million per year in lost funding for wel- make up for the loss in grants. Michigan would have to increase state fare (AFDC). III. A Balanced Budget Amendment and taxes by 18.1 percent across-the-board to $387 million per year in lost funding for the ‘‘Contract with America’’ tax cuts would make up for the loss in grants. education, job training, the environment, reduce other annual Federal spending in III. A Balanced Budget Amendment and housing, and other areas. Maryland by $8.6 billion. the ‘‘Contract with America’’ tax cuts would Mississippi would have to increase state $1.9 billion per year in Medicare benefits. reduce other annual Federal spending in taxes by 28.5 percent across-the-board to $6.7 billion per year in other spending in- Michigan by $6.8 billion. make up for the loss in grants. cluding housing assistance, student loans, $4.6 billion per year in Medicare benefits. III. A Balanced Budget Amendment and veterans’ benefits, and grants to local gov- $2.3 billion per year in other spending in- the ‘‘Contract with America’’ tax cuts would ernments. cluding housing assistance, student loans, reduce other annual Federal spending in Mis- THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- sissippi by $2.3 billion. MENT AND THE CONTRACT WITH AMERICA ON ernments. $978 million per year in Medicare benefits. THE STATE OF MASSACHUSETTS THE IMPACT OF A BALANCED BUDGET AMEND- $1.3 billion per year in other spending in- I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON cluding housing assistance, student loans, reduce annual Federal grants to the Massa- THE STATE OF MINNESOTA veterans’ benefits, and grants to local gov- chusetts state government by $1.9 billion. I. A Balanced Budget Amendment would ernments. $1.1 billion per year in lost funding for reduce annual Federal grants to the Min- Medicaid. THE IMPACT OF A BALANCED BUDGET AMEND- nesota state government by $1.2 billion. $248 million per year in lost highway trust MENT AND THE CONTRACT WITH AMERICA ON $679 million per year in lost funding for fund grants. THE STATE OF MISSOURI Medicaid. $135 million per year in lost funding for $102 million per year in lost highway trust I. A Balanced Budget Amendment would welfare (AFDC). reduce annual Federal grants to the Missouri $459 million per year in lost funding for fund grants. $83 million per year in lost funding for wel- state government by $1.3 billion. education, job training, the environment, fare (AFDC). $747 million per year in lost funding for housing, and other areas. Medicaid. Massachusetts would have to increase $314 million per year in lost funding for $109 million per year in lost highway trust state taxes by 12.6 percent across-the-board education, job training, the environment, fund grants. to make up for the loss in grants. housing, and other areas. II. A Balanced Budget Amendment com- Minnesota would have to increase state $62 million per year in lost funding for wel- bined with the ‘‘Contract with America’’ tax taxes by 9.4 percent across-the-board to fare (AFDC). cuts would require even deeper spending make up for the loss in grants. $398 million per year in lost funding for cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- education, job training, the environment, to the Massachusetts state government by bined with the ‘‘Contract with America’’ tax housing, and other areas. $2.6 billion. cuts would require even deeper spending Missouri would have to increase state $1.5 billion per year in lost funding for cuts, thereby reducing annual Federal grants taxes by 15.5 percent across-the-board to Medicaid. to the Minnesota state government by $1.6 make up for the loss in grants. $340 million per year in lost highway trust billion. II. A Balanced Budget Amendment com- fund grants. $931 million per year in lost funding for bined with the ‘‘Contract with America’’ tax $185 million per year in lost funding for Medicaid. cuts would require even deeper spending $139 million per year in lost highway trust welfare (AFDC). cuts, thereby reducing annual Federal grants fund grants. $630 million per year in lost funding for to the Missouri state government by $1.8 bil- $113 million per year in lost funding for education, job training, the environment, lion. housing, and other areas. welfare (AFDC). $431 million per year in lost funding for $1.0 billion per year in lost funding for Massachusetts would have to increase Medicaid. state taxes by 17.3 percent across-the-board education, job training, the environment, $149 million per year in lost highway trust to make up for the loss in grants. housing, and other areas. fund grants. III. A Balanced Budget Amendment and Minnesota would have to increase state the ‘‘Contract with America’’ tax cuts would taxes by 13.0 percent across-the-board to $85 million per year in lost funding for wel- reduce other annual Federal spending in make up for the loss in grants. fare (AFDC). Massachusetts by $6.4 billion. III. A Balanced Budget Amendment and $547 million per year in lost funding for $3.4 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would education, job training, the environment, $3.1 billion per year in other spending in- reduce other annual Federal spending in housing, and other areas. cluding housing assistance, student loans, Minnesota by $3.5 billion. Missouri would have to increase state veterans’ benefits, and grants to local gov- $1.5 billion per year in Medicare benefits. taxes by 21.2 percent across-the-board to ernments. $2.0 billion per year in other spending in- make up for the loss in grants. cluding housing assistance, student loans, THE IMPACT OF A BALANCED BUDGET AMEND- III. A Balanced Budget Amendment and veterans’ benefits, and grants to local gov- MENT AND THE CONTRACT WITH AMERICA ON the ‘‘Contract with America’’ tax cuts would ernments. THE STATE OF MICHIGAN reduce other annual Federal spending in Mis- I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- souri by $5.4 billion. reduce annual Federal grants to the Michi- MENT AND THE CONTRACT WITH AMERICA ON $2.4 billion per year in Medicare benefits. gan state government by $2.5 billion. THE STATE OF MISSISSIPPI $3.0 billion per year in other spending in- $1.4 billion per year in lost funding for I. A Balanced Budget Amendment would cluding housing assistance, student loans, Medicaid. reduce annual Federal grants to the Mis- veterans’ benefits, and grants to local gov- $140 million per year in lost highway trust sissippi state government by $864 million. ernments. fund grants. $496 million per year in lost funding for THE IMPACT OF A BALANCED BUDGET AMEND- $229 million per year in lost funding for Medicaid. MENT AND THE CONTRACT WITH AMERICA ON welfare (AFDC). $61 million per year in lost highway trust THE STATE OF MONTANA $753 million per year in lost funding for fund grants. education, job training, the environment, $24 million per year in lost funding for wel- I. A Balanced Budget Amendment would housing, and other areas. fare (AFDC). reduce annual Federal grants to the Mon- Michigan would have to increase state $282 million per year in lost funding for tana state government by $277 million. taxes by 13.2 percent across-the-board to education, job training, the environment, $123 million per year in lost funding for make up for the loss in grants. housing, and other areas. Medicaid.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00026 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3165

$52 million per year in lost highway trust $116 million per year in lost funding for THE IMPACT OF A BALANCED BUDGET AMEND- fund grants. Medicaid. MENT AND THE CONTRACT WITH AMERICA ON $12 million per year in lost funding for wel- $32 million per year in lost highway trust THE STATE OF NEW JERSEY fare (AFDC). fund grants. I. A Balanced Budget Amendment would $89 million per year in lost funding for edu- $11 million per year in lost funding for wel- cation, job training, the environment, hous- reduce annual Federal grants to the New fare (AFDC). Jersey state government by $2.5 billion. ing, and other areas. $68 million per year in lost funding for edu- Montana would have to increase state $1.5 billion per year in lost funding for cation, job training, the environment, hous- taxes by 19.8 percent across-the-board to Medicaid. ing, and other areas. make up for the loss in grants. $141 million per year in lost highway trust II. A Balanced Budget Amendment com- Nevada would have to increase state taxes fund grants. bined with the ‘‘Contract with America’’ tax by 6.2 percent across-the-board to make up $129 million per year in lost funding for cuts would require even deeper spending for the loss in grants. welfare (AFDC). cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- $705 million per year in lost funding for to the Montana state government by $380 bined with the ‘‘Contract with America’’ tax education, job training, the environment, million. cuts would require even deeper spending housing, and other areas. $169 million per year in lost funding for cuts, thereby reducing annual Federal grants New Jersey would have to increase state Medicaid. to the Nevada state government by $312 mil- taxes by 12.7 percent across-the-board to $71 million per year in lost highway trust lion. make up for the loss in grants. fund grants. $159 million per year in lost funding for $17 million per year in lost funding for wel- II. A Balanced Budget Amendment com- Medicaid. bined with the ‘‘Contract with America’’ tax fare (AFDC). $44 million per year in lost highway trust cuts would require even deeper spending $123 million per year in lost funding for fund grants. cuts, thereby reducing annual Federal grants education, job training, the environment, $15 million per year in lost funding for wel- to the New Jersey state government by $3.4 housing, and other areas. fare (AFDC). billion. Montana would have to increase state $94 million per year in lost funding for edu- $2.1 billion per year in lost funding for taxes by 27.1 percent across-the-board to cation, job training, the environment, hous- Medicaid. make up for the loss in grants. ing, and other areas. III. A Balanced Budget Amendment and $194 million per year in lost highway trust Nevada would have to increase state taxes the ‘‘Contract with America’’ tax cuts would fund grants. by 8.6 percent across-the-board to make up reduce other annual Federal spending in $177 million per year in lost funding for Montana by $1.0 billion. for the loss in grants. III. A Balanced Budget Amendment and welfare (AFDC). $298 million per year in Medicare benefits. $968 million per year in lost funding for $722 million per year in other spending in- the ‘‘Contract with America’’ tax cuts would education, job training, the environment, cluding housing assistance, student loans, reduce other annual Federal spending in Ne- housing, and other areas. veterans’ benefits, and grants to local gov- vada by $1.4 billion. New Jersey would have to increase state ernments. $354 million per year in Medicare benefits. taxes by 17.5 percent across-the-board to THE IMPACT OF A BALANCED BUDGET AMEND- $1.0 billion per year in other spending in- cluding housing assistance, student loans, make up for the loss in grants. MENT AND THE CONTRACT WITH AMERICA ON III. A Balanced Budget Amendment and THE STATE OF NEBRASKA veterans’ benefits, and grants to local gov- ernments. the ‘‘Contract with America’’ tax cuts would I. A Balanced Budget Amendment would reduce other annual Federal spending in New reduce annual Federal grants to the Ne- THE IMPACT OF A BALANCED BUDGET AMEND- Jersey by $6.4 billion. braska state government by $388 million. MENT AND THE CONTRACT WITH AMERICA ON $4.0 billion per year in Medicare benefits. $192 million per year in lost funding for THE STATE OF NEW HAMPSHIRE $2.4 billion per year in other spending in- Medicaid. I. A Balanced Budget Amendment would $44 million per year in lost highway trust cluding housing assistance, student loans, reduce annual Federal grants to the New fund grants. veterans’ benefits, and grants to local gov- $23 million per year in lost funding for wel- Hampshire state government by $212 million. ernments. $112 million per year in lost funding for fare (AFDC). THE IMPACT OF A BALANCED BUDGET AMEND- Medicaid. $129 million per year in lost funding for MENT AND THE CONTRACT WITH AMERICA ON $31 million per year in lost highway trust education, job training, the environment, THE STATE OF NEW MEXICO housing, and other areas. fund grants. Nebraska would have to increase state $11 million per year in lost funding for wel- I. A Balanced Budget Amendment would taxes by 13.3 percent across-the-board to fare (AFDC). reduce annual Federal grants to the new make up for the loss in grants. $58 million per year in lost funding for edu- Mexico state government by $524 million. II. A Balanced Budget Amendment com- cation, job training, the environment, hous- $233 million per year in lost funding for bined with the ‘‘Contract with America’’ tax ing, and other areas. Medicaid. cuts would require even deeper spending New Hampshire would have to increase $70 million per year in lost highway trust cuts, thereby reducing annual Federal grants state taxes by 17.6 percent across-the-board fund grants. to the Nebraska state government by $533 to make up for the loss in grants. $28 million per year in lost funding for wel- million. II. A Balanced Budget Amendment com- fare (AFDC). $264 million per year in lost funding for bined with the ‘‘Contract with America’’ tax $193 million per year in lost funding for Medicaid. cuts would require even deeper spending education, job training, the environment, $60 million per year in lost highway trust cuts, thereby reducing annual Federal grants housing, and other areas. fund grants. New Mexico would have to increase state $31 million per year in lost funding for wel- to the New Hampshire state government by $291 million. taxes by 12.9 percent across-the-board to fare (AFDC). make up for the loss in grants. $177 million per year in lost funding for $154 million per year in lost funding for II. A Balanced Budget Amendment com- education, job training, the environment, Medicaid. bined with the ‘‘Contract with America’’ tax housing, and other areas. $43 million per year in lost highway trust Nebraska would have to increase state fund grants. cuts would require even deeper spending taxes by 18.3 percent across-the-board to $16 million per year in lost funding for wel- cuts, thereby reducing annual Federal grants make up for the loss in grants. fare (AFDC). to the New Mexico state government by $719 III. A Balanced Budget Amendment and $79 million per year in lost funding for edu- million. the ‘‘Contract with America’’ tax cuts would cation, job training, the environment, hous- $320 million per year in lost funding for reduce other annual Federal spending in Ne- ing, and other areas. Medicaid. braska by $1.7 billion. New Hampshire would have to increase $96 million per year in lost highway trust $661 million per year in Medicare benefits. state taxes by 24.1 percent across-the-board fund grants. $1.0 billion per year in other spending in- to make up for the loss in grants. $38 million per year in lost funding for wel- cluding housing assistance, student loans, III. A Balanced Budget Amendment and fare (AFDC). veterans’ benefits, and grants to local gov- the ‘‘Contract with America’’ tax cuts would $265 million per year in lost funding for ernments. reduce other annual Federal spending in New education, job training, the environment, THE IMPACT OF A BALANCED BUDGET AMEND- Hampshire by $773 million. housing, and other areas. MENT AND THE CONTRACT WITH AMERICA ON $370 million per year in Medicare benefits. New Mexico would have to increase state THE STATE OF NEVADA $403 million per year in other spending in- taxes by 17.6 percent across-the-board to I. A Balanced Budget Amendment would cluding housing assistance, student loans, make up for the loss in grants. reduce annual Federal grants to the Nevada veterans’ benefits, and grants to local gov- III. A Balanced Budget Amendment and state government by $227 million. ernments. the ‘‘Contract with America’’ tax cuts would

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00027 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3166 CONGRESSIONAL RECORD — SENATE February 27, 1995 reduce other annual Federal spending in New III. A Balanced Budget Amendment and Ohio would have to increase state taxes by Mexico by $2.9 billion. the ‘‘Contract with America’’ tax cuts would 19.8 percent across-the-board to make up for $440 million per year in Medicare benefits. reduce other annual Federal spending in the loss in grants. $2.5 billion per year in other spending in- North Carolina by $4.4 billion. III. A Balanced Budget Amendment and cluding housing assistance, student loans, $2.0 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would veterans’ benefits, and grants to local gov- $2.4 billion per year in other spending in- reduce other annual Federal spending in ernments. cluding housing assistance, student loans, Ohio by $8.2 billion. THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- $4.7 billion per year in Medicare benefits. MENT AND THE CONTRACT WITH AMERICA ON ernments. $3.5 billion per year in other spending in- THE STATE OF NEW YORK THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- reduce annual Federal grants to the New THE STATE OF NORTH DAKOTA ernments. York state government by $8.2 billion. I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- $5.4 billion per year in lost funding for reduce annual Federal grants to the North MENT AND THE CONTRACT WITH AMERICA ON Medicaid. Dakota state government by $229 million. THE STATE OF OKLAHOMA $274 million per year in lost highway trust $105 million per year in lost funding for fund grants. Medicaid. I. A Balanced Budget Amendment would $535 million per year in lost funding for $35 million per year in lost highway trust reduce annual Federal grants to the Okla- welfare (AFDC). fund grants. homa state government by $770 million. $1.9 billion per year in lost funding for edu- $8 million per year in lost funding for wel- $424 million per year in lost funding for cation, job training, the environment, hous- fare (AFDC). Medicaid. ing, and other areas. $81 million per year in lost funding for edu- $51 million per year in lost highway trust New York would have to increase state cation, job training, the environment, hous- fund grants. taxes by 17.4 percent across-the-board to ing, and other areas. $51 million per year in lost funding for wel- make up for the loss in grants. North Dakota would have to increase state II. A Balanced Budget Amendment com- fare (AFDC). taxes by 19.7 percent across-the-board to $244 million per year in lost funding for bined with the ‘‘Contract with America’’ tax make up for the loss in grants. cuts would require even deeper spending education, job training, the environment, II. A Balanced Budget Amendment com- housing, and other areas. cuts, thereby reducing annual Federal grants bined with the ‘‘Contract with America’’ tax Oklahoma would have to increase state to the New York state government by $11.2 cuts would require even deeper spending taxes by 12.4 percent across-the-board to billion. cuts, thereby reducing annual Federal grants $7.5 billion per year in lost funding for make up for the loss in grants. to the North Dakota state government by Medicaid. $314 million. II. A Balanced Budget Amendment com- $376 million per year in lost highway trust $144 million per year in lost funding for bined with the ‘‘Contract with America’’ tax fund grants. Medicaid. cuts would require even deeper spending $734 million per year in lost funding for $48 million per year in lost highway trust cuts, thereby reducing annual Federal grants welfare (AFDC). to the Oklahoma state government by $1.1 $2.6 billion per year in lost funding for edu- fund grants. $10 million per year in lost funding for wel- billion. cation, job training, the environment, hous- fare (AFDC). $582 million per year in lost funding for ing, and other areas. Medicaid. New York would have to increase state $111 million per year in lost funding for $70 million per year in lost highway trust taxes by 23.8 percent across-the-board to education, job training, the environment, fund grants. make up for the loss in grants. housing, and other areas. III. A Balanced Budget Amendment and North Dakota would have to increase state $69 million per year in lost funding for wel- the ‘‘Contract with America’’ tax cuts would taxes by 27.0 percent across-the-board to fare (AFDC). reduce other annual Federal spending in New make up for the loss in grants. $335 million per year in lost funding for York by $15.2 billion. III. A Balanced Budget Amendment and education, job training, the environment, $9.4 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would housing, and other areas. $5.7 billion per year in other spending in- reduce other annual Federal spending in Oklahoma would have to increase state cluding housing assistance, student loans, North Dakota by $773 million. taxes by 17.0 percent across-the-board to veterans’ benefits, and grants to local gov- $317 million per year in Medicare benefits. make up for the loss in grants. $455 million per year in other spending in- ernments. III. A Balanced Budget Amendment and cluding housing assistance, student loans, THE IMPACT OF A BALANCED BUDGET AMEND- the ‘‘Contract with America’’ tax cuts would veterans’ benefits, and grants to local gov- MENT AND THE CONTRACT WITH AMERICA ON reduce other annual Federal spending in ernments. THE STATE OF NORTH CAROLINA Oklahoma by $2.9 billion. THE IMPACT OF A BALANCED BUDGET AMEND- I. A Balanced Budget Amendment would $1.3 billion per year in Medicare benefits. MENT AND THE CONTRACT WITH AMERICA ON reduce annual Federal grants to the North $1.6 billion per year in other spending in- THE STATE OF OHIO Carolina state government by $1.7 billion. cluding housing assistance student loans, $1.0 billion per year in lost funding for I. A Balanced Budget Amendment would veterans’ benefits, and grants to local gov- Medicaid. reduce annual Federal grants to the Ohio ernments. $136 million per year in lost highway trust state government by $2.8 billion. THE IMPACT OF A BALANCED BUDGET AMEND- fund grants. $1.7 billion per year in lost funding for MENT AND THE CONTRACT WITH AMERICA ON $95 million per year in lost funding for wel- Medicaid. THE STATE OF OREGON fare (AFDC). $170 million per year in lost highway trust $441 million per year in lost funding for fund grants. I. A Balanced Budget Amendment would education, job training, the environment, $212 nillion per year is lost funding for wel- reduce annual Federal grants to the Oregon housing, and other areas. fare (AFDC). state government by $706 million. North Carolina would have to increase $727 million per year in lost funding for $342 million per year in lost funding for state taxes by 11.1 percent across-the-board education, job training, the environment, Medicaid. to make up for the loss in grants. housing, and other areas. $54 million per year in lost highway trust II. A Balanced Budget Amendment com- Ohio would have to increase state taxes by fund grants. bined with the ‘‘Contract with America’’ tax 14.4 percent across-the-board to make up for $47 million per year in lost funding for wel- cuts would require even deeper spending the loss in grants. fare (AFDC). II. A Balanced Budget Amendment com- cuts, thereby reducing annual Federal grants $263 million per year in lost funding for bined with the ‘‘Contract with America’’ tax to the North Carolina state government by education, job training, the environment, cuts would require even deeper spending $2.3 billion. housing, and other areas. $1.4 billion per year in lost funding for cuts, thereby reducing annual Federal grants Medicaid. to the North Dakota state government by Oregon would have to increase state taxes $187 million per year in lost highway trust $3.9 billion. by 12.2 percent across-the-board to make up fund grants. $2.4 billion per year in lost funding for for the loss in grants. $130 million per year in lost funding for Medicaid. II. A Balanced Budget Amendment com- welfare (AFDC). $233 million per year in lost highway trust bined with the ‘‘Contract with America’’ tax $605 billion per year in lost funding for edu- fund grants. cuts would require even deeper spending cation, job training, the environment, hous- $290 million per year in lost funding for cuts, thereby reducing annual Federal grants ing, and other areas. welfare (AFDC). to the Oregon state government by $969 mil- North Carolina would have to increase $997 million per year in lost funding for lion. state taxes by 15.2 percent across-the-board education, job training, the environment, $469 million per year in lost funding for to make up for the loss in grants. housing, and other areas. Medicaid.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00028 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3167 $75 million per year in lost highway trust $350 million per year in lost funding for cuts, thereby reducing annual Federal grants fund grants. Medicaid. to the South Dakota state government by $65 million per year in lost funding for wel- $58 million per year in lost highway trust $316 million. fare (AFDC). fund grants. $142 million per year in lost funding for $361 million per year in lost funding for $32 million per year in lost funding for wel- Medicaid. education, job training, the environment, fare (AFDC). $53 million per year in lost highway trust housing, and other areas. $150 million per year in lost funding for fund grants. Oregon would increase state taxes by 16.8 education, job training, the environment, $9 million per year in lost funding for wel- percent across-the-board to make up for the housing, and other areas. fare (AFDC). loss in grants. Rhode Island would have to increase state $113 million per year in lost funding for III. A Balanced Budget Amendment and taxes by 29.3 percent across-the-board to education, job training, the environment, the ‘‘Contract with America’’ tax cuts would make up for the loss in grants. housing, and other areas. reduce other annual Federal spending in Or- III. A Balanced Budget Amendment and South Dakota would have to increase state egon by $2.9 billion. the ‘‘Contract with America’’ tax cuts would taxes by 33.8 percent across-the-board to $1.3 billion per year in Medicare benefits. reduce other annual Federal spending in make up for the loss in grants. $1.6 billion per year in other spending in- Rhode Island by $849 million. cluding housing assistance, student loans, $476 million per year in Medicare benefits. III. A Balanced Budget Amendment and veteran’s benefits, and grants to local gov- $373 million per year in other spending in- the ‘‘Contract with America’’ tax cuts would ernments. cluding housing assistance student loans, reduce other annual Federal spending in THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- South Dakota by $792 million. MENT AND THE CONTRACT WITH AMERICA ON ernments. $281 million per year in Medicare benefits. $511 million per year in other spending in- THE STATE OF PENNSYLVANIA THE IMPACT OF A BALANCED BUDGET AMEND- cluding housing assistance, student loans, I. A Balanced Budget Amendment would MENT AND THE CONTRACT WITH AMERICA ON veterans’ benefits, and grants to local gov- reduce annual Federal grants to the Pennsyl- THE STATE OF SOUTH CAROLINA ernments. vania state government by $3.1 billion. I. A Balanced Budget Amendment would $1.8 billion per year in lost funding for reduce annual Federal grants to the South THE IMPACT OF A BALANCED BUDGET AMEND- Medicaid. Carolina state government by $1.0 billion. MENT AND THE CONTRACT WITH AMERICA ON $211 million per year in lost highway trust $644 million per year in lost funding for THE STATE OF TENNESSEE fund grants. Medicaid. I. A Balanced Budget Amendment would $178 million per year in lost funding for $68 million per year in lost highway trust reduce annual Federal grants to the Ten- welfare (AFDC). fund grants. nessee state government by $1.5 billion. $901 million per year in lost funding for $31 million per year in lost funding for wel- education, job training, the environment, $989 million per year in lost funding for fare (AFDC). Medicaid. housing, and other areas. $260 million per year in lost funding for Pennsylvania would have to increase state $78 million per year in lost highway trust education, job training, the environment, taxes by 12.7 percent across-the-board to fund grants. housing, and other areas. make up for the loss in grants. $60 million per year in lost funding for wel- South Carolina would have to increase II. A Balanced Budget Amendment com- fare (AFDC). state taxes by 14.3 percent across-the-board bined with the ‘‘Contract with America’’ tax $411 million per year in lost funding for to make up for the loss in grants. cuts would require even deeper spending education, job training, the environment, II. A Balanced Budget Amendment com- cuts, thereby reducing annual Federal grants housing, and other areas. bined with the ‘‘Contract with America’’ tax to the Pennsylvania state government by Tennessee would have to increase state cuts would require even deeper spending $4.2 billion. taxes by 19.5 percent across-the-board to cuts, thereby reducing annual Federal grants $2.4 billion per year in lost funding for make up for the loss in grants. Medicaid. to the South Carolina state government by $1.4 billion. II. A Balanced Budget Amendment com- $290 million per year in lost highway trust bined with the ‘‘Contract with America’’ tax fund grants. $883 million per year in lost funding for Medicaid. cuts would require even deeper spending $244 million per year in lost funding for cuts, thereby reducing annual Federal grants welfare (AFDC). $94 million per year in lost highway trust fund grants. to the Tennessee state government by $2.1 $1.2 billion per year in lost funding for edu- billion. cation, job training, the environment, hous- $42 million per year in lost funding for wel- fare (AFDC). $1.4 billion per year in lost funding for ing, and other areas. Medicaid. Pennsylvania would have to increase state $357 million per year in lost funding for $107 million per year in lost highway trust taxes by 17.4 percent across-the-board to education, job training, the environment, fund grants. make up for the loss in grants. housing, and other areas. III. A Balanced Budget Amendment and South Carolina would have to increase $82 million per year in lost funding for wel- the ‘‘Contract with America’’ tax cuts would state taxes by 19.6 percent across-the-board fare (AFDC). reduce other annual Federal spending in to make up for the loss in grants. $563 million per year in lost funding for Pennsylvania by $11.7 billion. III. A Balanced Budget Amendment and education, job training, the environment, $7.0 billion per year in Medicare benefits. the ‘‘Contract with America’’ tax cuts would housing, and other areas. $4.7 billion per year in other spending in- reduce other annual Federal spending in Tennessee would have to increase state cluding housing assistance student loans, South Carolina by $3.0 billion. taxes by 26.7 percent across-the-board to veterans’ benefits, and grants to local gov- $935 million per year in Medicare benefits. make up for the loss in grants. ernments. $2.1 billion per year in other spending in- III. A Balanced Budget Amendment and cluding housing assistance, student loans, THE IMPACT OF A BALANCED BUDGET AMEND- the ‘‘Contract with America’’ tax cuts would veterans’ benefits, and grants to local gov- MENT AND THE CONTRACT WITH AMERICA ON reduce other annual Federal spending in ernments. THE STATE OF RHODE ISLAND Tennessee by $5.3 billion. I. A Balanced Budget Amendment would THE IMPACT OF A BALANCED BUDGET AMEND- $1.9 billion per year in Medicare benefits. reduce annual Federal grants to the Rhode MENT AND THE CONTRACT WITH AMERICA ON $3.4 billion per year in other spending in- Island state government by $430 million. THE STATE OF SOUTH DAKOTA cluding housing assistance, student loans, $255 million per year in lost funding for I. A Balanced Budget Amendment would veterans’ benefits, and grants to local gov- Medicaid. reduce annual Federal grants to the South ernments. $42 million per year in lost highway trust Dakota state government by $231 million. THE IMPACT OF A BALANCED BUDGET AMEND- fund grants. $103 million per year in lost funding for MENT AND THE CONTRACT WITH AMERICA ON $23 million per year in lost funding for wel- Medicaid. THE STATE OF TEXAS fare (AFDC). $39 million per year in lost highway trust $109 million per year in lost funding for fund grants. I. A Balanced Budget Amendment would education, job training, the environment, $6 million per year in lost funding for wel- reduce annual Federal grants to the Texas housing, and other areas. fare (AFDC). state government by $4.2 billion. Rhode Island would have to increase state $82 million per year in lost funding for edu- $2.5 billion per year in lost funding for taxes by 21.4 percent across-the-board to cation, job training, the environment, hous- Medicaid. make up for the loss in grants. ing, and other areas. $340 million per year in lost highway trust II. A Balanced Budget Amendment com- South Dakota would have to increase state fund grants. bined with the ‘‘Contract with America’’ tax taxes by 24.7 percent across-the-board to $147 million per year in lost funding for cuts would require even deeper spending make up for the loss in grants. welfare (AFDC). cuts, thereby reducing annual Federal grants II. A Balanced Budget Amendment com- $1.2 billion per year in lost funding for edu- to the Rhode Island state government by $590 bined with the ‘‘Contract with America’’ tax cation, job training, the environment, hous- million. cuts would require even deeper spending ing, and other areas.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00029 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3168 CONGRESSIONAL RECORD — SENATE February 27, 1995 Texas would have to increase state taxes $13 million per year in lost funding for wel- $730 million per year in lost funding for by 14.0 percent across-the-board to make up fare (AFDC). Medicaid. for the loss in grants. $68 million per year in lost funding for edu- $117 million per year in lost highway trust II. A Balanced Budget Amendment com- cation, job training, the environment, hous- fund grants. bined with the ‘‘Contract with America’’ tax ing, and other areas. $126 million per year in lost funding for cuts would require even deeper spending Vermont would have to increase state welfare (AFDC). cuts, thereby reducing annual Federal grants taxes by 17.4 percent across-the-board to $346 million per year in lost funding for to the Texas state government by $5.7 bil- make up for the loss in grants. education, job training, the environment, lion. II. A Balanced Budget Amendment com- housing, and other areas. $3.5 billion per year in lost funding for bined with the ‘‘Contract with America’’ tax Washington would have to increase state Medicaid. cuts would require even deeper spending taxes by 8.4 percent across-the-board to $466 million per year in lost highway trust cuts, thereby reducing annual Federal grants make up for the loss in grants. fund grants. to the Vermont state government by $284 II. A Balanced Budget Amendment com- $202 million per year in lost funding for million. bined with the ‘‘Contract with America’’ tax welfare (AFDC). $122 million per year in lost funding for cuts would require even deeper spending $1.6 billion per year in lost funding for edu- Medicaid. cuts, thereby reducing annual Federal grants cation, job training, the environment, hous- $51 million per year in lost highway trust to the Washington state government by $1.8 ing, and other areas. fund grants. billion. $18 million per year in lost funding for wel- Texas would have to increase state taxes $1.0 billion per year in lost funding for fare (AFDC). by 19.2 percent across-the-board to make up Medicaid. for the loss in grants. $93 million per year in lost funding for edu- cation, job training, the environment, hous- $161 million per year in lost highway trust III. A Balanced Budget Amendment and fund grants. the ‘‘Contract with America’’ tax cuts would ing, and other areas. $172 million per year in lost funding for reduce other annual Federal spending in Vermont would have to increase state welfare (AFDC). Texas by $14.8 billion. taxes by 23.9 percent across-the-board to $474 million per year in lost funding for $5.9 billion per year in Medicare benefits. make up for the loss in grants. education, job training, the environment, $8.9 billion per year in other spending in- III. A Balanced Budget Amendment and housing, and other areas. cluding housing assistance, student loans, the ‘‘Contract with America’’ tax cuts would Washington would have to increase state veterans’ benefits, and grants to local gov- reduce other annual Federal spending in taxes by 11.5 percent across-the-board to ernments. Vermont by $413 million. $206 million per year in Medicare benefits. make up for the loss in grants. THE IMPACT OF A BALANCED BUDGET AMEND- $207 million per year in other spending in- III. A Balanced Budget Amendment and MENT AND THE CONTRACT WITH AMERICA ON cluding housing assistance, student loans, the ‘‘Contract with America’’ tax cuts would THE STATE OF UTAH veterans’ benefits, and grants to local gov- reduce other annual Federal spending in I. A Balanced Budget Amendment would ernments. Washington by $4.9 billion. reduce annual Federal grants to the Utah THE IMPACT OF A BALANCED BUDGET AMEND- $1.5 billion per year in Medicare benefits. state government by $422 million. MENT AND THE CONTRACT WITH AMERICA ON $3.4 billion per year in other spending in- $190 million per year in lost funding for THE STATE OF VIRGINIA cluding housing assistance, student loans, Medicaid. I. A Balanced Budget Amendment would veterans’ benefits, and grants to local gov- $49 million per year in lost highway trust reduce annual Federal grants to the Virginia ernments. fund grants. state government by $1.0 billion. THE IMPACT OF A BALANCED BUDGET AMEND- $22 million per year in lost funding for wel- $490 million per year in lost funding for MENT AND THE CONTRACT WITH AMERICA ON fare (AFDC). Medicaid. THE STATE OF WEST VIRGINIA $160 million per year in lost funding for $72 million per year in lost highway trust education, job training, the environment, I. A Balanced Budget Amendment would fund grants. housing, and other areas. reduce annual Federal grants to the West $49 million per year in lost funding for wel- Utah would have to increase state taxes by Virginia state government by $765 million. fare (AFDC). 11.4 percent across-the-board to make up for $488 million per year in lost funding for $393 million per year in lost funding for the loss in grants. Medicaid. education, job training, the environment, II. A Balanced Budget Amendment com- $45 million per year in lost highway trust housing, and other areas. bined with the ‘‘Contract with America’’ tax fund grants. Virginia would have to increase state taxes cuts would require even deeper spending $32 million per year in lost funding for wel- by 8.2 percent across-the-board to make up cuts, thereby reducing annual Federal grants fare (AFDC). for the loss in grants. to the Utah state government by $579 mil- II. A Balanced Budget Amendment com- $199 million per year in lost funding for lion. bined with the ‘‘Contract with America’’ tax education, job training, the environment, $261 million per year in lost funding for cuts would require even deeper spending housing, and other areas. Medicaid. cuts, thereby reducing annual Federal grants West Virginia would have to increase state $68 million per year in lost highway trust to the Virginia state government by $1.4 bil- taxes by 20.6 percent across-the-board to fund grants. lion. make up for the loss in grants. $31 million per year in lost funding for wel- $673 million per year in lost funding for II. A Balanced Budget Amendment com- fare (AFDC). Medicaid. bined with the ‘‘Contract with America’’ tax $220 million per year in lost funding for $99 million per year in lost highway trust cuts would require even deeper spending education, job training, the environment, fund grants. cuts, thereby reducing annual Federal grants housing, and other areas. $68 million per year in lost funding for wel- to the West Virginia state government by Utah would have to increase state taxes by fare (AFDC). $1.0 billion. 15.6 percent across-the-board to make up for $539 million per year in lost funding for $670 million per year in lost funding for the loss in grants. education, job training, the environment, Medicaid. III. A Balanced Budget Amendment and housing, and other areas. $62 million per year in lost highway trust the ‘‘Contract with America’’ tax cuts would Virginia would have to increase state taxes fund grants. reduce other annual Federal spending in by 11.2 percent across-the-board to make up $44 million per year in lost funding for wel- Utah by $1.5 billion. for the loss in grants. fare (AFDC). $323 million per year in Medicare benefits. III. A Balanced Budget Amendment and $273 million per year in lost funding for $1.2 billion per year in other spending in- the ‘‘Contract with America’’ tax cuts would education, job training, the environment, cluding housing assistance, student loans, reduce other annual Federal spending in Vir- housing, and other areas. veterans’ benefits, and grants to local gov- ginia by $8.3 billion. West Virginia would have to increase state ernments. $1.9 billion per year in Medicare benefits. taxes by 28.3 percent across-the-board to THE IMPACT OF A BALANCED BUDGET AMEND- $6.4 billion per year in other spending in- make up for the loss in grants. MENT AND THE CONTRACT WITH AMERICA ON cluding housing assistance, student loans, III. A Balanced Budget Amendment and THE STATE OF VERMONT veterans’ benefits, and grants to local gov- the ‘‘Contract with America’’ tax cuts would I. A Balanced Budget Amendment would ernments. reduce other annual Federal spending in reduce annual Federal grants to the THE IMPACT OF A BALANCED BUDGET AMEND- West Virginia by $1.7 billion. Vermont state government by $207 million. MENT AND THE CONTRACT WITH AMERICA ON $824 million per year in Medicare benefits. $89 million per year in lost funding for THE STATE OF WASHINGTON $835 million per year in other spending in- Medicaid. I. A Balanced Budget Amendment would cluding housing assistance, student loans, $37 million per year in lost highway trust reduce annual Federal grants to the Wash- veterans’ benefits, and grants to local gov- fund grants. ington state government by $1.3 billion. ernments.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00030 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3169

THE IMPACT OF A BALANCED BUDGET AMEND- veterans’ benefits, and grants to local gov- aggregates, resulting from different defini- MENT AND THE CONTRACT WITH AMERICA ON ernments. tions and sources, make this local vs. state, THE STATE OF WISCONSIN BALANCED BUDGET AMENDMENT—ESTIMATION decomposition of Other grants an imprecise I. A Balanced Budget Amendment would OF STATE-BY-STATE EFFECTS process. reduce annual Federal grants to the Wis- The following description provides infor- State tax revenues for the average of the consin state government by $1.3 billion. mation on the estimation and allocation of 1990 and 1992 fiscal years was also taken from $694 million per year in lost funding for spending cuts under two scenarios that issues of Government Finances. The use of Medicaid. achieve a balanced budget by FY2002 without two years at different points in the business $111 million per year in lost highway trust tax increases and with Social Security and cycle was designated to mitigate cyclical in- fund grants. defense excluded from spending reductions. fluences on projected revenue. $96 million per year in lost funding for wel- The second scenario differs from the first in Step 3: Project FY2002 Grants and State Taxes fare (AFDC). that it also incorporates a set of deficit-in- $349 million per year in lost funding for creasing provisions in the Contract with CBO’s projected levels for FY2002 for Social education, job training, the environment, America (CWA). These provisions are all tax Security, Medicare, and most other major housing, and other areas. reductions except for a spending increase as- spending categories were taken from the Wisconsin would have to increase state sociated with relaxation of the Social Secu- above-mentioned CBO report. For defense taxes by 10.3 percent across-the-board to rity earnings test. No specific defense spend- spending, the Administration’s project of make up for the loss in grants. ing increases discussed in the CWA are re- FY2000 defense outlays was inflated by the II. A Balanced Budget Amendment com- flected in the simulations. annual rate of growth to total discretionary bined with the ‘‘Contract with America’’ tax spending from FY2000 to FY2002 in the CBO cuts would require even deeper spending Step 1: Derive size of aggregate budget cuts projections. cuts, thereby reducing annual Federal grants Congressional Budget Office (CBO) baseline The projection of grant amounts was also to the Wisconsin state government by $1.7 estimates of the Federal deficit were taken derived from the long-term CBO budget fore- billion. from Table 4 of the preliminary Economic cast. AFDC grants were projected using the $952 million per year in lost funding for and Budget Outlook dated January 5, 1995. ratio of 2002 to 1993 values of Other Manda- Medicaid. Equal yearly deficit reductions, beginning in tory spending as reported by CBO, respec- $153 million per year in lost highway trust FY1996, were then computed which were suf- tively, in the January 5 report and on page 37 fund grants. ficient to achieve a balanced budget by of The Economic and Budget Outlook: Up- $132 million per year in lost funding for FY2002. date dated August 1994. (Unpublished figures welfare (AFDC). The required cuts take into account the in- on FY1993 Civil Service and military retire- $479 million per year in lost funding for terest savings that would result from lower ment spending were obtained from CBO.) education, job training, the environment, deficits and debt; a 6.7 percent rate of inter- Highway trust fund grants were projected housing, and other areas. est was assumed throughout based on long- using the ratio of 2002 to 1993 values of do- Wisconsin would have to increase state term CBO projections of the 10-year Treas- mestic discretionary spending; the 2002 value taxes by 14.2 percent across-the-board to ury note rate. The estimates are static in na- was estimated as estimated total nondefense make up for the loss in grants. ture and reflect no macroeconomics feed- discretionary spending multiplied by the III. A Balanced Budget Amendment and back—e.g., lower economic growth resulting FY2002 ratio of domestic to the sum of inter- the ‘‘Contract with America’’ tax cuts would from the contractionary effects of deficit re- national and domestic discretionary spend- reduce other annual Federal spending in Wis- duction or higher growth resulting from ing in Table 4 of the January 5 report. consin by $3.4 billion. lower tax rates. Deficit-reducing spending The category of Other grants was decom- $2.1 billion per year in Medicare benefits. and tax changes of $248 billion, or 22.5 per- posed into discretionary and mandatory $1.3 billion per year in other spending in- cent of noninterest, non-Social Security components. The Other mandatory compo- cluding housing assistance, student loans, spending, would have to be made in FY2002 nent was defined to include: Agricultural veterans’ benefits, and grants to local gov- to achieve a balanced budget. The required Marketing Service Funds for strengthening ernments. cumulative deficit reduction is approxi- markets (Section 32); child nutrition pro- THE IMPACT OF A BALANCED BUDGET AMEND- mately $1.3 trillion, of which about $0.2 tril- grams; food stamp grants; special milk pro- MENT AND THE CONTRACT WITH AMERICA ON lion occurs through interest savings. gram; national grasslands payments to coun- THE STATE OF WYOMING A similar procedure was used to derive re- ties; social services block grants; foster care quired spending reductions with the CWA’s I. A Balanced Budget Amendment would and adoption assistance; assistance for legal- tax cut and Social Security spending reduce annual Federal grants to the Wyo- ized aliens; other Administration for Chil- amounts (and associated interest carrying ming state government by $218 million. dren and Families grants; and Supplemental $55 million per year in lost funding for costs) added to the CBO deficit baseline. Es- Security Income grants. These were pro- Medicaid. timated revenue effects of the proposed tax jected in the same manner as AFDC, while $38 million per year in lost highway trust reductions were obtained from the Treasury the residual Other discretionary grants were fund grants. Department, Office of Tax Analysis. Annual projected in the same manner as highway $8 million per year in lost funding for wel- costs of the proposed relaxation of the Social grants. fare (AFDC). Security earnings test were taken from a Na- $118 million per year in lost funding for tional Economic Council staff working Total baseline state taxes were projected education, job training, the environment, paper, September 20, 1994. The required per- to move in proportion to nominal U.S. Gross housing, and other areas. centage spending reduction is 30.9 percent in Domestic Product. The projection of GDP for Wyoming would have to increase state this scenario. The aggregate required cuts in calendar year 2000 was taken from Table 1 of taxes by 18.7 percent across-the-board to total spending in FY2002 total $340 billion. the CBO January 5 report and increased by three years of assumed 2.3 percent real make up for the loss in grants. Step 2: Derive allocation parameters for states II. A Balanced Budget Amendment com- growth and 2.8 percent increases in the GDP bined with the ‘‘Contract with America’’ tax Grants to state and local governments, as price deflator. The growth in nominal GDP cuts would require even deeper spending well as Social Security, defense, and other between 1991 and 2002 was converted to a per cuts, thereby reducing annual Federal grants Federal spending, are reported in Federal Ex- capita basis. Individual state taxes in FY2002 to the Wyoming state government by $300 penditures by State for Fiscal Year 1993. Our were then estimated by multiplying 1990–1992 million. analysis divides intergovernmental grants state population growth and the growth in $75 million per year in lost funding for into four components. Aid to Families with U.S. per capita GDP. State population totals Medicaid. Dependent Children, Medicaid, highway trust for 2000 and 2010 were drawn from the 1994 $52 million per year in lost highway trust fund grants, and all Other. It was assumed Statistical Abstract, and our estimates for fund grants. that all grants in the first three of these cat- 2002 were interpolations of the 2000 and 2010 $10 million per year in lost funding for wel- egories went directly to state governments. values. To estimate the local share of the Other cat- fare (AFDC) Step 4: Derive required grant reductions and $162 million per year in lost funding for egory, we used estimates of total 1992 inter- state tax increases education, job training, the environment, governmental revenues from Federal to local housing, and other areas. governments in each state, as reported in the The percentage reductions in FY2002 Wyoming would have to increase state August 1994 Census publication Government grants and other spending components nec- taxes by 25.7 percent across-the-board to Finances, 1991–92: Preliminary Report. These essary to achieve budget balance were, by as- make up for the loss in grants. state-by-state estimates were divided by the sumption, equal to the aggregate rate com- III. A Balanced Budget Amendment and Government Finances estimates of Federal puted for all nondefense, non-Social Security the ‘‘Contract with America’’ tax cuts would revenues to states and localities combined, spending. Finally, the percentage increase in reduce other annual Federal spending in Wy- less the values of AFDC, Medicaid, and high- the state tax levels necessary to make up the oming by $393 million. way grants from the FY1992 edition of Fed- dollar loss in Federal grants to each state $131 million per year in Medicare benefits. eral Expenditures by State. It should be em- was computed.—Office of Economic Policy, $262 million per year in other spending in- phasized that discrepancies between the Gov- Department of the Treasury, January 11, cluding housing assistance, student loans, ernment Finances and Federal Expenditures 1995.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00031 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3170 CONGRESSIONAL RECORD — SENATE February 27, 1995

HIGH COST OF A BALANCED BUDGET spending by enough to offset deposit insur- And the private sector invariably invests AMENDMENT ance costs. But the potential size of those money more efficiently than the Govern- (By Richard Kogan) payments shows why they could not be eas- ment, this view holds. ily offset. The recent restructuring of the Advocates of the Balanced Budget Amend- THE ‘‘AUTOMATIC STABILIZERS’’ OF THE savings and loan industry required deposit ment to the Constitution do not intend to ECONOMY RELY ON DEFICIT SPENDING jeopardize the life savings of America’s fami- insurance payments of $156 billion over four ‘‘The people have spoken clearly that gov- lies, or threaten the stability of the nation’s years, $66 billion in 1991 alone. And the gov- ernment is too big and we need to do some- banks. As written, however, the amendment ernment’s deposit insurance guarantee cov- thing about it,’’ said Robert Hall, a Stanford could do just that. ers private savings of $2.7 trillion. These Currently, America’s savings are safe. The amounts are too large to be offset by a single University economist who favors smaller Federal Deposit Insurance Corp. (FDIC) year’s tax increases or spending cuts. government. ‘‘The problem is that the bal- guarantees individual deposits in banks and Second, there is the escape hatch. By a anced budget amendment is a heavy-handed thrift institutions up to $100,000 per account. three-fifths vote, Congress could choose to solution and risky.’’ Depositors rely on the U.S. government to pay deposit insurance and allow deficit The biggest risk is to the nation’s ‘‘auto- keep its word, quickly and automatically; if spending. But it is hardly automatic that matic stabilizers,’’ which have made reces- a bank goes broke, the government makes Congress would respond in a timely manner sions less severe than they were in the cen- good on deposits. Deposit insurance claims (or at all), even in a pending crisis. In Au- tury before World War II. The stabilizers, an are enforceable in court. gust 1941 Congress barely mustered a major- outgrowth of Keynesian economics, work Now look at the Balanced Budget Amend- ity to extend the draft, even though Hitler this way: When the economy weakens, out- ment. It begins, ‘‘Total outlays for any fiscal had already marched across half of Europe. lays automatically rise for unemployment year shall not exceed total receipts for that In the current debate, neither the Senate nor pay, food stamps, welfare and Medicaid. Si- fiscal year, unless three-fifths of the whole the House could find a majority to write into multaneous, as incomes fall, so do corporate number of each house of Congress shall pro- the amendment an exception for recessions. and individual income tax payments. Both vide by law for a specific excess of outlays Finding three-fifths majorities in each House elements make more money available for over receipts by a roll-call vote.’’ This decep- of Congress is significantly more difficult. spending, thus helping to pull the economy tively simple concept—that the federal budg- By the time Congress fully understands the out of its slump. et must be balanced each eyar—would inad- scope of a developing banking crisis and The problem, of course, is that the stabi- vertently cast doubt over the ‘‘full faith and gathers the three-fifths vote (if it can), the lizers make the deficit shoot up—by roughly credit’’ of the U.S. government, putting all problem would have grown, perhaps to a dan- $65 billion as a result of the 1990–1991 reces- federal guarantees, including deposit insur- gerous degree. sion, according to the Treasury Department. ance, at risk. Taking the amendment at face value, then, Under the balanced budget amendment, Con- Here’s why. During a severe economic legal commitments made by the U.S. govern- gress and the Administration would be re- downturn, the risk of bank failure is great- ment would no longer be binding. When eco- quired to get the budget quickly back into est. An economic downturn also produces (or nomic troubles arose and the banking sys- balance, through spending cuts, higher tax exacerbates) federal budget deficits as tax tem, depositors and the economy as whole rates, or a combination of the two—perhaps revenues decline and spending for programs most needed it, those ‘‘commitments’’ could even in the midst of a recession. such as unemployment compensation in- prove ephemeral. ‘‘The Government would become, almost creases. At such time, the government would inevitably, a destabilizer of the economy lack the extra revenues it could need to [From the New York Times, Feb. 21, 1995] rather than a stabilizer,’’ said Joseph cover the large costs of rescuing depositors THE PITFALLS OF A BALANCED BUDGET: DIS- Stiglitz, a member of the President’s Council and the banking system. Under current law, MANTLING A DECADES-OLD SYSTEM FOR of Economic Advisers. Many economists deposit insurance claims are automatically SOFTENING RECESSIONS share that view. paid as needed, regardless of the deficit. (By Louis Uchitelle) Under the amendment, if deposit insurance Absent the stabilizers, every 73-cent drop payments would cause a deficit, might not The unemployment rate, which peaked at in national income in the last recession those payments be prohibited? Don’t forget 7.7 percent after the last recession, could would have become a $1 drop, said Bradford that the measure would amend the Constitu- have reached 9 percent if a balanced budget DeLong, deputy assistant Secretary of the tion, while deposit insurance and other such has been required, Government and private Treasury, who as a Harvard economist stud- guarantees are only statutes. economists estimate. And a laid-off worker ies this dynamic and recently updated his re- American banking was not always pro- who collected $12,000 in unemployment pay search. Of the 27 cents in cushioning, 20 tected. The Great Depression was so steep— might have received only $7,000 or so. cents came from falling tax revenue and 7 the economy shrank almost 30 percent from Such estimates of the potential economic cents from the higher spending. 1929 to 1933—in part because there was no de- impact are not emphasized very much, how- Economists outside the Government offer posit insurance. Some lost all their savings. ever, in the debate over the balanced budget similar estimates. Ray Fair of Yale Univer- A rumor that a bank was in trouble prompt- amendment. So far, the battle has focused on sity, for example, said for every $10 billion ed panic, with depositors rushing to with- its value as a tool to shrink government or decline in national income during a reces- draw their savings. Even false rumors caused to discipline spending. But if the amendment sion, the deficit rises by $2 billion, as the banks to collapse. is enacted, the side effect would be huge: a stabilizers kick in with their higher spending One of President Roosevelt’s first acts was system that has softened recessions since the and lower tax revenue. to close the banks while Congress enacted 1930’s would be dismantled. ‘‘We ought not to give up the stabilizers,’’ deposit insurance. The banks reopened, citi- ‘‘There are risks associated with a bal- Professor Fair said. ‘‘That would be very zens could redeposit their funds in safety and anced budget, and I don’t think anyone Draconian.’’ should deny them.’’ said William Hoagland, the economic collapse ended. Deposit insur- Nearly every economist agrees that the the Republican staff director for the Senate ance became the first and best economic sta- American economy requires, if not stabi- Budget Committee. ‘‘Nevertheless, the de- bilizer. It is one reason that no post-war re- lizers, some substitute method for offsetting bate on the floor has been dominated by cession has shrunk the economy more than recessions in an era of balanced budgets. And 1 what we must do to get the budget in bal- 3 ⁄2 percent. those who favor the amendment are no ex- ance, not what the risks of a balanced budget Doesn’t the FDIC charge annual fees to ception. banks, building up large balances, which amendment might be.’’ ‘‘It would be a disaster to lose the stabi- would automatically be available in a bank- Mr. Hoagland expressed surprise that the lizers,’’ said C. Fred Bergsten, director of the ing crisis? biggest risk—deeper, more painful reces- Not after the amendment. It prohibits sions—had not figured significantly in the Institute of International Economics, who spending borrowed funds. Incredibly, it also debate, although Senator Daniel P. Moy- endorses the amendment as a necessary step prohibits using accumulated savings; it re- nihan, Democrat of New York, and Senator if the nation is to afford the high cost of So- quires that all federal spending in any fiscal Paul S. Sarbanes, Democrat of Maryland, cial Security and Medicare for the baby year be covered by that year’s revenues. This had called attention to this risk in several boom generation, which reaches retirement requirement is like telling a family to fi- floor speeches. ‘‘The reason must be that the age early in the next century. nance a new house or a child’s college tui- advocates of a balanced budget see the bene- Mr. Bergsten notes that the amendment, tion out of that year’s wages, no matter how fits to the economy as far outweighing the as now worded, would permit Congress to much money the family has in the bank. In negatives associated with cyclical down- bring back the stabilizers by a three-fifths this case, the amendment precludes a sudden turn,’’ Mr. Hoagland said. ‘‘That must be vote in both houses. The vote would permit increase in deposit insurance payments if what is going on.’’ the necessary deficit spending to finance the that increase would cause federal spending No benefit seems to hold more sway than stabilizers. to exceed federal revenues in that year, no the view that the amendment would shrink While a three-fifths vote is a big hurdle, matter how much the FDIC has ‘‘in the the Federal Government by restricting its Mr. Bergsten and others argue that Congress bank.’’ power to tax and to spend. A dollar not col- would get used to authorizing the necessary There are two possible ways out. First, lected and spent by the Government is a dol- deficits during recessions. Nevertheless, he Congress could raise taxes or cut other lar left in the hands of the private sector. would prefer a different solution. Once

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00032 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3171 through the painful process of balancing the be debated by Congress this week—promises micks to spend outside ‘‘the budget.’’ The budget by 2002, as required by the amend- just such a popular conversion. The proposal amendment has no enforcement mechanism: ment, then the Government should run budg- is a very bad idea. courts refuse to intervene, because budget et surpluses in years of strong economic You should not confuse balancing the choices are deemed ‘‘political’’ matters. growth and full employment, Mr. Bergsten budget, which in general is desirable, with (Probability: 40 percent.) said. the undesirability of using the Constitution Until the 1960s, Americans valued balanced The surpluses would cover the rising costs to do it. Just because the Constitution re- budgets. The respect was rooted in Jeffer- of the stabilizers during recessions. ‘‘You quires a balanced budget does not mean that sonian beliefs that budget balancing checked could go down to a balanced budget in the the budget will be balanced. If an amend- the ‘‘corruption’’ of government, writes po- hard years, and still give the economy a lit- ment were regularly flouted, then the budg- litical scientist James Savage of the Univer- tle stimulus,’’ he said. etary impasse would become a constitutional sity of Virginia.* Deficits were tolerated in IS MONETARY POLICY ENOUGH TO BOLSTER THE crisis. ‘‘The first principle of a conservative wars and depressions. But the need for dis- U.S. ECONOMY IN TOUGH TIMES? should be: don’t muck with the Constitu- cipline was seen, and budgets were balanced tion,’’ says constitutional scholar Robert in good times. This consensus was destroyed The Congressional Budget Office has esti- Goldwin of the American Enterprise Insti- by Keynesian doctrines that deficits could mated that the surplus needed to pay for the tute. spur the economy. Now, the need is to re- stabilizers during a recession as severe as By this standard, Congress has lots of Re- verse this: to de-emphasize the budget’s use that of 1981–1982, the worst since World War publicans but few conservatives. The amend- as an economic tool, and to restore a bal- II, would be 1 percent of the national income ment’s advocates essentially embrace a the- anced budget as a way of defining what gov- during robust periods of full employment, ory of immaculate consensus. No one wants ernment should and shouldn’t do. and perhaps as much as 1.5 percent. to confront the inconsistencies of public BIPARTISAN HYSTERIA That would mean an annual surplus in to- opinion—the simultaneous desires for lower day’s dollars of $70 billion to $100 billion, taxes, higher spending and no tampering Unfortunately, the balanced-budget rather than the nearly $200 billion or so in with social security—that cause budget defi- amendment serves as an excuse to evade spe- annual deficits expected under current pol- cits. Instead, an amendment is supposed to cifics. At present, balancing the budget is icy. Most of the $200 billion is to help pay for dissolve these inconsistencies. Congress not so hard. The deficit equals about 2.5 to 3 programs like highway construction and new can’t control ‘‘its deficit addiction without percent of national income. Americans will weaponry that have fixed costs and do not the strong therapy of a constitutional man- not starve if farm subsidies stop; the elderly fluctuate with the ups and downs of the date to make it get clean and sober,’’ pro- will not become destitute if cost-of-living ad- economy, as unemployment pay, food claims Orrin Hatch, chairman of the Senate justments are trimmed; the economy will stamps, tax revenues and the other stabi- Judiciary Committee. not collapse if taxes are raised modestly. lizers do. All recent major amendment proposals Changes are horrific only if any spending Some economists—including Milton Fried- have been similarly inspired; they aimed to cuts or tax increases are considered intoler- man, a Nobel laureate in economics who is pervert the Constitution by using it to settle able. The harder issues involve adjusting with the Hoover Institute—hold that the sta- passionate public disputes. The school-pray- programs for baby boomers’ retirement. bilizers, despite the ballyhoo, are no longer er, ‘‘equal rights’’ and anti-abortion amend- Yet, budget hysteria is bipartisan. House so important. The Federal Reserve, through ments all fit this description. None suc- Majority Leader Richard Armey won’t say monetary policy, can more than offset their ceeded, because the Founders did not intend how Republicans would balance the budget disappearance by lowering interest rates an for the Constitution to be so used. They set because ‘‘once members of Congress know extra notch or two to give the economy an high hurdles for amendments (two-thirds exactly, chapter and verse, the pain . . . to additional stimulus in hard times. congressional approval, then ratification by get to a balanced budget, their knees will ‘‘I have looked at many episodes in the three quarters of the states). Although Pro- buckle.’’ President Clinton condemns GOP world in which monetary policy went one hibition—the 18th Amendment—overcame silence. But he has not proposed a balanced way and fiscal policy the other, and I have these barriers, it showed the folly of using budget; all the White House plugs is ‘‘deficit never found a case in which monetary policy the Constitution for consciousness-raising. reduction.’’ Worse, it tries to terrify people did not dominate,’’ Mr. Friedman said. He fa- Congress passed it in 1917 in a ‘‘mood of about the harsh tax hikes or spending cuts vors a balanced budget amendment that Spartan idealism’’ created by World War I, needed to balance the budget. would shrink the Federal Government by wrote historian Frederick Lewis Allen. If the The resort to the Constitution is a reckless putting a ceiling on the tax increases that war would ‘‘end all wars,’’ then Americans gambit that could backfire in many ways. It could be enacted to balance the budget. could imagine an ‘‘era of efficient sobriety!’’ postpones necessary choices and, perversely, But the Clinton Administration and even The actual result was rampant lawlessness: could make the choices harder by mobilizing Federal Reserve officials question whether bootleggers, speak-easies and gangsterism. threatened groups against ratification. But monetary policy could alone handle the task Congress was complicit because—caught be- mostly it assaults our political culture. The of reviving an economy in recession. The sta- tween demands for tougher enforcement and Constitution stands above ordinary disputes; bilizers, they note, kick in automatically— for repeal—it did neither. Finally, the that’s why it’s respected. The amendment before the Federal Reserve and most econo- amendment was repealed in 1933. imperils this. Instead of elevating the budget mists often realize that the economy is fall- The plain lesson that the Constitution debate, it may lower the Constitution. ing toward recession. can’t singlehandedly impose consensus is A recession might be well along and get- now ignored. The amendment’s proponents [From the New York Times, Jan. 24, 1995] ting deeper before the Fed recognized the echo the simple moralisms of prohibition- STATE OF THE UNION? SOMEDAY, PARALYZED problem and began to drop rates. The lower ists; note Senator Hatch’s identical imagery (By Paul Starr) rates, in turn, would not be felt in the econ- (‘‘get clean and sober’’). The reality is bound omy for a year to 18 months, the traditional to be grittier. Consider three broad possibili- PRINCETON, N.J. When the Framers re- lag. And even if the Fed acted quickly ties and their probability if Congress passes placed the Articles of Confederation with the enough, the economy would behave in new the amendment. Constitution, they gave the Government un- and different ways without the stabilizers. It’s ratified by the states—and it works. qualified and unimpeded fiscal powers. ‘‘My guess is that we would get it wrong Intimidated, Congress and the president end Today, a new Republican majority in Con- the first time we went into recession, mak- programs (farm subsidies, public TV) and gress proposes to overturn that decision. ing that recession much deeper than it trim entitlements (social security, Medi- Speaker Newt Gingrich says he intends to re- should be,’’ said a Federal Reserve official, care). Because a deficit remains, they also verse the growth of the Federal Govern- who spoke on condition that he not be iden- raise taxes. Finally, they pass long-term so- ment’s role in society since 1932. The legacy tified. ‘‘But we would learn from that experi- cial-security and Medicare reforms to pre- he challenges, however, is not only that of ence and do a better job thereafter.’’ vent huge deficits when baby boomers retire. Franklin D. Roosevelt but more fundamen- (Probability, generously: 20 percent.) tally that of Alexander Hamilton. [From Newsweek, Jan. 30, 1995] It isn’t ratified. Congressional passage As President Clinton delivers his State of triggers a lobbying and TV blitz aimed at the Union Message tonight, many Americans CORRUPTING THE CONSTITUTION: BALANCE THE state legislatures by groups that feel threat- will wonder about the fate of particular pro- BUDGET, BUT NOT BY AMENDMENT ened (the elderly, farmers, the poor, etc.). grams and policies in the new Congress. But (By Robert J. Samuelson) State and local officials realize the amend- the larger question raised by the Repub- The Constitution is not a sledgehammer. It ment could be costly; less federal spending licans is the Government’s capacity to act, embodies broad principles of government and on highways, health care and schools will for they propose not just to shrink programs enduring national values. As such, it com- mean more pressure for local spending. but to impose a permanent constitutional mands deep public respect and even rev- (Probability: 40 percent.) straightjacket that is likely to paralyze the erence. There’s a temptation to think that It’s ratified—and doesn’t work as adver- Government in future crises. its power and mystique can bludgeon public tised. Congress balks at visible tax increases The Constitution is a parsimonious docu- opinion into convenient consensus on hard or entitlement cuts. Or it regularly votes to ment, unencumbered with detailed policy issues. It can’t, and the exercise shouldn’t be run deficits by a three-fifths majority, as the prescriptions. This restraint expressed con- tried. The balanced-budget amendment—to amendment permits. Or it resorts to gim- fidence in representative government; it left

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00033 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3172 CONGRESSIONAL RECORD — SENATE February 27, 1995 the people’s future representatives free to lawing charge accounts. Credit cards have automatic stabilizers that moderate eco- confront problems the Founders knew they not doomed the economy, nor will Federal nomic activity whenever business activity could not anticipate. As Hamilton explains deficits. weakens. Thus, when workers lose jobs, un- in ‘‘The Federalist’’ (No. 30), it was impru- The problem of the deficit is its long-term employment compensation rises and it cush- dent to set any limit to the new govern- rate of growth, which is due almost entirely ions the slide. If business profits are off, then ment’s taxing power because there was no to projected health care costs. There are no tax liabilities decline. These events boost clear limit to the demands that might be more grounds for making a zero deficit a the government deficit, thus offsetting to placed upon it. The Constitutional Conven- constitutionally required objective than for some degree the decline in the private sec- tion deliberately rejected requirements for denying corporations or families the ability tor. supermajorities: impediments to revenue- to borrow. Federal deficits of 1 or 2 percent ‘‘But the balanced budget amendment raising had helped make the Articles of Con- of the gross domestic product are entirely would take away these automatic stabilizers federation unworkable. manageable. If the outstanding debt is infla- when the economy is slowing down,’’ Tyson Today’s Republican majority apparently tion-adjusted annually, deficits of that scale said. It would force the government to raise believes it is more capable of making fiscal typically do not amount to a real increase in taxes or cut spending to cover the increasing policy for future generations than were the the debt anyway. deficit that a slowing economy was gener- Founding Fathers. It seeks to prescribe a Judge Robert Bork opposes the amendment ating. Rivlin puts it this way: ‘‘Fiscal policy balanced-budget amendment, to require a as unworkable. So do other jurists, who would exaggerate, rather than mitigate, three-fifths supermajority for tax increases think that if Congress used accounting gim- swings in the economy. Recessions would and to prohibit the Government from impos- micks to portray an unbalanced budget as tend to be deeper and longer.’’ ing requirements on the states except when balanced, the courts would have no com- Meanwhile, the House Republican version it assumes 100 percent of the costs. petence to enforce the amendment. And of the amendment wrongly (and possibly un- These measures are frankly intended to some state officials worry that the burdens constitutionally) requires a three-fifths ma- disable a Government that many Americans of Federal cutbacks would be passed on to jority of each house of Congress to increase say they no longer trust. Yet those measures them. If the Senate does not derail the revenue, run budget deficits or increase the severely weaken the Government’s capacity amendment, such objections may well do so. public debt. There is supposed to be a safety to achieve any purpose. They hand weapons The original rationale for constitutional valve to permit a deficit in time of real eco- to minorities to obstruct majorities: a mi- parsimony still stands. We will never know nomic weakness. But who in Congress is a nority in either house would be able to im- enough about the future to predict the tests good enough forecaster to sense when the pede preparations for national defense as that democratic government will face. More safety valve should be opened? As Rivlin well as spending on the poor. than 200 years of American history should said, in all likelihood, ‘‘the damage would be If in the pursuit of a balanced budget in assure us that the Republic not only can sur- done long before we recognize that the econ- the year 2002, we cut Medicare and social vive without constitutionally imposed fiscal omy is turning down.’’ programs and provoked an inevitable angry restrictions, it has been better off without Why would the amendment also be bad reaction, it would be all the harder to find them. constitutional policy? Not only would it put money for purposes that conservatives pre- If the Constitution had required a balanced fiscal policy, as outlined above, in a strait- fer, whether ‘‘Star Wars’’ defense systems, budget, many members of Congress would jacket, it would denigrate the document that more prisons or intensified border patrols. not sit there today: for one thing, Thomas deals with the big issues—individual rights, The Government’s capacity to act is a re- Jefferson could never have completed the the system of separation of powers, the ulti- source as much for conservative as for lib- Louisiana Purchase. mate guarantor of our system of liberties in eral purposes. So those who are planting a Hamilton’s legacy of unimpeded fiscal effect since 1776. It would force the courts to time bomb under the welfare state may see power has been crucial to a system of gov- adjudicate disputes certain to arise. it explode in their own faces. ernment that has brought us through wars, Meanwhile, what are the hard choices The comeuppance could be much more se- depressions and natural calamities to an un- being avoided? The Republicans who are rious for the nation than for any party. The challenged position as the strongest nation pushing the ‘‘Contract With America’’ freely dangers would likely be greatest in a reces- on earth. concede that to balance the budget by the sion. If revenue fell along with economic ac- During the Depression, World War II and year 2002, as called for by the amendment, tivity and if three-fifths of Congress could the cold war, there was a ready-made answer would cost $1.2 trillion in cuts in the various not agree to run a deficit, the Government to questions about why we needed a strong big entitlement programs—Social Security, would be forced to aggravate the downturn Federal Government. The crisis of Govern- Medicare, Medicaid and other pensions. But by cutting public expenditures as well—a ment capacity has erupted today in part be- they aren’t prepared to make them. Rep. recipe for turning recessions into depres- cause there is no longer any shared sense of Richard K. Armey of Texas, House majority sions. the Government’s overriding mission. But leader, said forthrightly that if members of The Pentagon is committed to maintaining depressions and wars have not been banished Congress understood the full dimension of forces prepared to fight two wars simulta- forever; rules we adopt now must be good what is involved, ‘‘they would buckle at the neously, but a nation with weakened fiscal when the world turns bad. knees.’’ powers is much less capable of sustaining Constitutionalizing fiscal policy is bad for But wait, there’s more than $1.2 trillion in- such commitments. Our enemies would un- the Constitution and bad for fiscal policy. It volved: Because of the new tax cuts and derstand this and act accordingly. would make a mockery of one or a failure of other ‘‘reforms’’ proposed in the Republican Some critics may dismiss these as empty the other, or both. ‘‘Contract,’’ there is an additional $450 mil- worries. After all, the amendment, if passed lion that would have to be found by 2002— in time, would not require a balanced budget [From the Washington Post, Jan. 22, 1995] making a net reduction of $1.65 trillion. until 2002. But seven years come soon But the story isn’t over—and this is the ANY WAY ITS PROPONENTS SLICE IT, enough. Concerns about the amendment are most significant missing piece. BALANCED-BUDGET AMENDMENT IS BALONEY empty only if the amendment itself is empty The bland assumption is that if somehow a of force. (By Hobart Rowen) miracle is accomplished—the huge $1.65 tril- The requirements for supermajorities are The case against a constitutional amend- lion cuts are made to balance the budget by the most dangerous element in the Repub- ment to balance the budget is overwhelming. 2002—the budget will continue to be in bal- licans’ plan. But even if they reduced voting It has been hyped by Democrats and Repub- ance. Not so! The dirty little secret is that requirements to an absolute majority of licans alike as the only way to force reluc- within a few years after 2002, as the Kerry- members of Congress—as many Democrats tant congressmen to make tough decisions, Danforth entitlement commission report prefer—it would give undue constitutional and there is no doubt that a large segment of showed, the workplace demographics begin force to the norm of budget balancing. the public has come to believe this propa- to explode, and with that, the budget deficit. Denying the Government the routine ganda. Fewer workers in the labor force supporting power to borrow is a surrender to the medie- But the truth is that an amendment to the Social Security pensioners will drive the So- val view of debt that continues to shape pop- Constitution for this purpose is bad econom- cial Security trust fund deep into the red. ular attitudes. The introduction of credit ics, bad budget policy and bad constitutional Once again, the budget will be unbalanced, cards almost three decades ago prompted policy. By itself, such an amendment would perhaps more so than before—and the game overwhelming disapproval in public opinion cut neither a dollar nor a program from the must start over again. surveys; meanwhile, Americans got the cards federal budget. As Office of Management and Clearly, the balanced-budget amendment is in droves. Budget Director Alice S. Rivlin told the Sen- bad business. Congress should reconsider the There has never been a time—not even dur- ate Judiciary Committee on Jan. 5, ‘‘most of whole plot. The real goal, in the first place, ing the New Deal—when public opinion sur- all, it evades the hard choices needed to should not be to balance the budget but to veys failed to register overwhelming dis- achieve real deficit reduction.’’ balance the economy. The deficit needs to be approval of government deficits. Yet Ameri- Why is the constitutional amendment bad cut back sharply, but to aim at a balance in cans’ disapproval of deficits ought to be economics? In an interview, Council of Eco- 2002 or 2012 is self-defeating. There will be taken as a mandate for constitutional prohi- nomic Advisers Chairman Laura D’Andrea some years ahead when the nation may need bition about as seriously as their disapproval Tyson points out that the beauty of the to run a deficit—and it shouldn’t be afraid to of credit cards was taken as grounds for out- present fiscal system is that it contains make such decisions.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00034 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3173 The need now is to put aside the gim- Unless a three-fifths supermajority saves the our elderly, our working people, and es- mickry, forget the constitutional amend- day, Congress would have to raise taxes and pecially our children and our grand- ment and for the Clinton administration and cut spending in a slow economy—the oppo- children. The debt burden is a mort- the Republican Congress to attend to busi- site of responsible stewardship. gage on their future. ness. A little maturity, please! Take another unintended consequence. When savings and loans went bankrupt dur- Mr. President, the time has come for [From the New York Times, Feb. 27, 1995] ing the 1980’s, the Federal Government a solution strong enough that it cannot UNBALANCED AMENDMENT bailed out depositors with borrowed money, be evaded for short-term gain. We need Tomorrow’s vote in the Senate on the bal- thereby preventing a banking panic. But a constitutional amendment or re- anced-budget amendment is crucial for the under the proposed amendment, the Govern- quirement to balance our budget. Republican agenda to chop Government pro- ment could not react instantly unless a House Joint Resolution 1, the con- grams into bits. The outcome is also crucial supermajority in Congress approved. sensus balanced budget amendment, is The balanced-budget amendment appeals to the nation because the pernicious amend- to taxpayers who demand that the Govern- that solution. It is reasonable. It is en- ment would do enormous fiscal damage. Pro- ment spend their money wisely. But Sen- forceable. It is necessary to force Con- ponents are alarmingly within three votes of ators Nunn, Ford, Conrad, Dorgan and gress to get our fiscal house in order. It winning. Breaux need to recognize that this honorable not only furthers the economic welfare The core of the amendment would require sentiment cannot be wisely embedded into the Government to balance its books unless of our Republic, it fosters the Constitu- the Constitution. three-fifths of the House and Senate vote to tion’s purpose of protecting liberty run a deficit. To the wavering Democrats— Mr. BYRD. Mr. President, I yield the through the framework of limited gov- John Breaux of Louisiana, Sam Nunn of floor. ernment. Georgia, Wendell Ford of Kentucky, and Mr. HATCH. Mr. President, I notice James Madison, in explaining the Kent Conrad and Byron Dorgan of North Da- the Senator from Massachusetts is theory undergirding the Government kota—here are five unassailable reasons to here. If I can, I would like to make a he helped to create, had this to say vote no. few comments. about government and human nature: UNNECESSARY Mr. President, the gist of the amend- Government [is] the greatest of all reflec- Federal deficits have indeed been too high. ments of the distinguished Senator tions on human nature. If men were angels, That poses a threat that borrowing will si- from West Virginia numbered 252 and no government would be necessary. If angels phon savings away from productive private 254 is that the majority provisions of were to govern men, neither external nor in- investments. ternal controls on government would be nec- But the fact that borrowing must be con- House Joint Resolution 1 are undemo- cratic and alter the fine balance in the essary. In framing a government that is to tained does not imply it ought to be elimi- be administered by men over men, the great nated—any more than family borrowing, to Constitution between the branches of difficulty lies in this: You must first enable buy a house or pay college tuition, need be Government. the government to control the governed; and eliminated. A prudent rule would keep Fed- More specifically, as I understand the in the next place oblige it to control itself. A eral debt growing less quickly than incomes. distinguished Senator from West Vir- dependence on the people is no doubt the pri- This rule would justify deficits of about $200 ginia, he contends—and I think in the mary control on government; but experience billion a year, close to current levels. past has eloquently debated the bal- has taught mankind the necessity of auxil- MISLEADING anced budget amendment—that Con- iary precautions. Proponents claim the amendment would gress’ control over taxing, spending, Now, Mr. President, we are here to protect future generations against ruinous and borrowing is diluted by restraints debate an auxiliary precaution, House interest payments. True, today’s children placed on such powers by super- Joint Resolution 1, proposing an will owe taxes when they grow up to pay in- terest on Federal debt. But proponents ig- majority requirements of the amend- amendment to the Constitution of the nore the fact that the tax payments will flow ment. According to the distinguished United States to require a balanced right back to these children as owners of Senator from West Virginia, the de- budget, because our recent history has Government bonds. mocracy reflected by the present ma- shown that Congress is not under con- UNENFORCEABLE jority requirement of Congress would trol and will not bring spending under Because key terms of the amendment—like be dealt a blow if this amendment control without such a mechanism outlays and receipts—are undefined, Con- passes. being placed into the Constitution. gress will be able to manipulate and evade. Naturally, I disagree. The balanced The balanced budget amendment Can Congress create independent agencies or budget amendment furthers the pur- helps restore two important elements find other ways to spend and borrow off the pose and structure of the Constitution. in the constitutional structure: limited Government books? A Senate committee has Indeed, the amendment goes to the government and an accountable, delib- already written into the legislative record, erative legislative assembly, both of used to guide future court decisions, that the very heart of the hope of the Framers Tennessee Valley Authority would be exempt of the Constitution for the constitu- which are vital to a free and vibrant from the amendment. It should take lawyers tional system, a system that would constitutional democracy. five minutes to stretch whatever ‘‘principle’’ protect individual freedom and restrain Deliberative assembly—the essence guides that exception to scores of other Gov- the size and power of the Federal Gov- of whose authority is, in Alexander ernment programs. ernment. Hamilton’s words, ‘‘to enact laws, or in The amendment also fails to provide an en- In the latter half of this century, other words to prescribe rules for the forcement mechanism. I might simply be- however, the intention of the Framers regulation of society’’ for the common come an empty gesture or, worse yet, the has been betrayed by Congress’ own in- good—was considered by the Framers courts might step in to tell Congress how much it should tax and where it should ability to control its spending habits. of the Constitution the most important spend. Passage and ratification of the bal- branch of the Government because it IRRATIONAL anced budget amendment would restore reflected the will of the people. Yet, as Federal bookkeeping lumps ordinary the constitutional Framers’ promises the makers of laws, it was considered spending with long-term public investments. of liberty and what the Framers called the most powerful and the one that Congress, forced by the amendment to cut our republican form of government. needed to be guarded against the most. quickly, would go after hugely expensive, Mr. President, let me first say what Recognizing that in republican gov- though vitally important, investments, such the modern day crisis is. Our Nation is ernment the legislative authority nec- as scientific research, costly laboratories faced with the worsening problem of essarily predominates and to prevent and equipment, job training or other invest- rising national debt and deficits and elective despotism, James Madison, the ments that would not produce benefits for the increased Government use of cap- father of the Constitution, rec- years, if not decades. ital that would otherwise be available ommended that the Philadelphia Con- RECKLESS to the private sector to create jobs or vention adopt devices in the Constitu- When the economy slows, tax revenues fall to invest in our future. Increased tion that would safeguard liberty. off and spending on unemployment insurance amounts of capital are being wasted on These include bicameralism, separa- and food stamps rises. This automatic rise in the deficit, by triggering spending, serves to merely financing the debt through spi- tion of powers and checks and bal- mitigate the slowdown. But under the pro- raling interest costs. This problem pre- ances, a qualified executive veto, lim- posed amendment, Congress could easily sents risk to our long-term economic iting congressional authority through turn a mild downturn into something worse. growth and endangers the well-being of enumerating its powers, and, of course,

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00035 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3174 CONGRESSIONAL RECORD — SENATE February 27, 1995 the election of legislators to assure ac- to elect the President. The same re- ties of Congress, except through con- countability to the people. quirements exist for the Senate choos- stitutional amendment. Shall we tear However, in the late 20th century, ing the Vice President; again, a super- up the Bill of Rights and the Constitu- our century, these constitutional proc- majority. The 25th amendment dealing tion because they contain checks on esses that Madison termed auxiliary with the President’s competency and the power of transient majorities? I do precautions have failed to limit the vo- removal requires that if Congress is not think so. racious appetite of Congress to legis- not in session within 21 days after Con- As I have said, as Thomas Jefferson late in every area of private concern, gress is required to assemble, it must said, as even Prof. Laurence Tribe has to invade the traditional bailiwick of determine by a two-thirds vote of both said, the power of transient majorities the States, and consequently, to spend Houses that the President is unable to to saddle minorities or future majori- and spend to fund these measures until discharge the duties of his office. Now, ties with debt is the kind of infringe- the Government has become function- all of those are supermajorities. All of ment on fundamental rights that de- ally insolvent and the economy placed those are part of the Constitution now. serves constitutional protection. The in jeopardy. Congress has been mutated Mr. President, it is indeed ironic as Framers wished to protect life, liberty from a legislative assembly delib- we debate a constitutional amendment and property. They reacted harshly erating the economic interests into the following a cloture vote, that argu- against taxation without representa- playground of special interests. ments are being made that mere ma- tion. As I pointed out throughout this The balanced budget amendment, Mr. jorities are more appropriate to funda- debate, our deficit spending taxes gen- President, will go a long way toward mental constitutional decisionmaking erations which are not now rep- ameliorating this wrong. It will create than supermajorities. We recently resented. It takes their property and an additional constitutional process, voted on ending this debate, and we their economic liberty. It is wholly ap- an auxiliary precaution, if you will, were scheduled to vote on that again propriate that we at least increase the that will bring back legislative ac- before we entered into an agreement consensus of those currently rep- countability to the constitutional sys- setting a final vote. A substantial ma- resented to allow them to shackle tem. jority expressed its desire to end the those who are not—that is, future gen- The balanced budget amendment debate. A three-fifths vote of Sen- erations—with the debt, the taxes and process accomplishes this by making ators—that means 60 Senators—must the economic servitude that go with Federal deficit spending significantly vote to end debate. Is that rule inap- citizenship in a country with high na- more difficult. Significantly, it ad- propriate in a constitutional debate? Of tional debt. vances liberty by making it more dif- course not. As a matter of fact, I think Opponents of the balanced budget ficult for the Government to fund over- we would have had the 60 votes had we amendment charge that supermajority zealous legislation and regulation that gone to cloture the second time. I requirements will create some new invades the private lives of citizens. think that is one reason why the mi- kind of sinister bargaining among fac- According to Prof. Harvey Mansfield, nority agreed to the time agreement tions to gain advantage in return for Jr., of Harvard, in his scholarly book, that we now have before the Senate. supporting the necessary consensus. ‘‘The Taming of the Prince,’’ the real The Constitution requires that a This objection strikes me as strange genius of our Constitution is that, hav- supermajority approve a constitutional because that kind of negotiation is as ing placed all power in the hands of its amendment. To pass the balanced old as the legislative process. It hap- citizenry, the American people con- budget amendment, we must have 67 pens now in the search for a majority. sented to restraints on that power. Un- Senators vote for it. Is this inappro- derstanding that direct or pure democ- priate? Or should we allow some num- Opponents also charge that the bal- racies in history were inherently un- ber between 26 and 51, or 50 with the anced budget amendment writes fiscal stable and fickle, the Framers placed Vice President casting the tie-breaking policy into the Constitution in an inap- restraints on popular rule and congres- vote to approve the balanced budget propriate way. This amendment deals sional power, what we now call super- amendment? The Constitution requires with the structural problem in our fis- majority requirements. that three-quarters of the States ratify cal decisionmaking. We unthinkingly Senator BYRD is this body’s expert on the balanced budget amendment. Per- spend money we do not have for tem- these requirements, but we will men- haps our majoritarian friends would porary benefit to our children’s long- tion some of them again, that are in prefer that some number of States be- term harm. But I would note that the the Constitution now. Article I, section tween 26 and 51 ratify the amendment, 16th amendment allows taxes to be lev- 3, the Senate may convict on an im- with the District of Columbia, Puerto ied by Congress. Is that not fiscal pol- peachment vote of two-thirds; article I, Rico, or Guam casting the tie-breaking icy in the same sense as the balanced section 5, each House may expel a vote if the States are evenly divided. budget amendment? Article I, section 8 Member with a two-thirds vote, a That is not the Constitution, however. allows Congress to collect taxes, du- supermajority; article I, section 7, a The Constitution provides for a super- ties, imposts and excises, to borrow Presidential veto may be overridden by majority. money and to regulate commerce. Are a two-thirds vote of each House, again, Mr. President, if majority rule were not these fiscal policy provisions like a supermajority in each House; article the fundamental principle of our Gov- the balanced budget amendment? In II, section 2, the Senate advises and ernment, as I have heard some in this fact, is not the balanced budget amend- consents to treaties, again, by a major- debate say, we would not have the Gov- ment simply a process to safeguard ity of two-thirds; article V, a constitu- ernment we do. We would have a uni- against overuse of the article I power tional amendment requires two-thirds cameral parliamentary system without to borrow? Article VI adopted the pre- of each House or a constitutional con- judicial review and, indeed, without Constitution debts of the Continental vention can be called by two-thirds of the Bill of Rights or a written Con- Congress. That was certainly a decision the State legislatures, three-quarters stitution, because each of those fea- of fiscal policy. of the State legislatures must ratify tures of our Government is an intru- Under the balanced budget amend- any constitutional amendment—all sion into the principle of majority rule, ment, majorities will continue to set supermajorities; article VII, the Con- and they are certainly not the only ex- budget priorities from year to year. stitution itself required ratification of amples. Only if a majority attempts to borrow 9 of the 13 States, again, a super- The first amendment does not say money from future generations to pay majority. Congress shall not abridge free speech for its priorities would there have to be This is not a democracy. This is a unless a fleeting majority wants to. It a supermajority vote. This allows the representative republic. Our Founding does not say that Congress shall not minority to play the conscience of the Fathers understood the need to have interfere with the free exercise of reli- Nation and to protect future genera- majorities. The 12th amendment re- gion or establish religion unless a ma- tions from the type of borrowing sprees quires a quorum of two-thirds of the jority of those present and voting want that we have seen in recent decades. States in the House to choose a Presi- to. The first amendment takes those I would note that those who believe dent. A majority of States is required options away from even supermajori- the supermajority vote would be the

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00036 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3175 rule rather than the exception betray order to make decisions, and they re- United States. I have said it would not their mental habit of thinking in terms jected that concept. So they in effect get us 1 cent closer to a balanced budg- of deficit spending. We must break this considered the very issue that is before et. I have contended that it would in- habit and make deficit spending the ex- us in this regard and rejected the no- vite evasive accounting and legal gym- ception instead of the rule. The bal- tion of supermajorities. nastics. I have expressed concern that anced budget amendment does not re- So they specifically weighed that it would open a whole new frontier for quire a supermajority to pass the budg- question at a time when they did in- judicial review. et, only a budget that is out of balance. clude some supermajorities in very spe- These concerns are not without basis The balanced budget amendment cre- cial instances. Obviously, amending and actual experience. I am sure we all ates a positive incentive for current the document is a very special in- remember the lengths we went to in majorities to avoid borrowing to avoid stance, and the veto is an essential order to get around the provisions of supermajority votes and risking the part of the checks and balances. the Gramm-Rudman-Hollings Act and kind of intrigue opponents say could I cite the quote of James Madison in other abbreviated attempts at deficit happen when supermajorities are re- Federalist Paper 58 in which he rejects reduction. We remember how, in the quired. This is wholly appropriate and the notion of the supermajorities in wake of the savings and loan crisis, the reasonable to break Congress of its bor- order to reach decisions and says in Resolution Trust Corporation was cre- rowing habit. fact in the course of that quote, and I ated, masking billions of dollars from Finally, Mr. President, the amend- will include all of it in the RECORD, ‘‘It budget totals. Even for this very ments offered by the Senator from would no longer be the majority that amendment, we have left definitions of West Virginia would gut the balanced would rule. The power would be trans- crucial language open to reinterpreta- budget amendment by cutting its cen- ferred to the minority.’’ And he spoke, tion. Today’s outlays may become to- tral provision, the supermajority re- of course, against that proposition. morrow’s ‘‘working capital.’’ quirement it places in the way of Con- There being no objection, the quote I think many of my colleagues will gress’ deficit spending. If either of was ordered to be printed in the also remember that in the past, I have these amendments were adopted, the RECORD, as follows: referred to this amendment as a sham balanced budget amendment would NO. 59: HAMILTON and a gimmick. I do not believe it is read in essence: ‘‘Congress shall not It has been said that more than a majority the panacea to a sound fiscal policy. It spend money it does not have unless it ought to have been required for a quorum; has been highly effective, however, in wants to.’’ and in particular cases, if not in all, more both roles by preventing us from focus- Such a balanced budget amendment than a majority of a quorum for a decision. ing on the real choices that must be would be no balanced budget amend- That some advantages might have resulted made in the Federal budget and serving ment at all. It would be the status-quo, from such a precaution cannot be denied. It as a nearly annual diversion that al- business-as-usual, let-us-keep-rolling- might have been an additional shield to some lows us to talk about balanced budgets particular interests, and another obstacle while avoiding the clear and urgent up-the-debt amendment. generally to hasty and partial measures. But This amendment, or other of these these considerations are outweighed by the need to adopt a sound fiscal policy. similar amendments, is a poison dart inconveniences in the opposite scale. In all This may sound, Mr. President, as if aimed at the heart of the last best hope cases where justice or the general good I am leading up to expressing a vote for the fiscal sanity of Congress and might require new laws to be passed, or ac- against a constitutional amendment to our country. I urge that they both be tive measures to be pursued, the funda- balance the budget. But this year, I in- defeated. mental principle of free government would tend to vote for final passage of the Mr. President, it is absolutely clear be reversed. It would be no longer the major- balanced budget amendment. I do so that to restore the constitutional con- ity that would rule: the power would be not as a result of the change in my transferred to the minority. Were the defen- views or beliefs or because of some rev- cept of limited government and its pro- sive privilege limited to particular cases, an tection of liberty, as well as to restore interested minority might take advantage of elation that this amendment does not fiscal and economic sanity, we must it to screen themselves from equitable sac- suffer from the flaws that troubled me pass this balanced budget amendment. rifices to the general weal, or, in particular in the past. Instead, I will vote for this We need the supermajority provisions emergencies, to extort unreasonable indul- amendment this year simply and solely of House Joint Resolution 1—a modern gences. to eliminate it as an excuse for not day ‘‘auxiliary precaution’’ in Madi- Mr. KENNEDY addressed the Chair. cutting spending. We have been debat- son’s words—to put teeth into the bal- The PRESIDING OFFICER (Mr. ing this amendment for more than a anced budget amendment, to be a force GRASSLEY). The Senator from Massa- decade, constantly arguing about a to end ‘‘business as usual’’ here in Con- chusetts [Mr. KENNEDY] is recognized. change in the Constitution that would gress and, most importantly, to foster Mr. KENNEDY. Mr. President, I no- force us somehow to do what we all the liberty of limited government that tice the distinguished Senator from know eventually must be done. the Framers believed to be essential. Kansas is on the floor and has an im- If this seems like a backhanded en- Mr. SARBANES. Mr. President, I just portant statement. I will be glad to dorsement to this amendment, it cer- very quickly want to address the argu- yield to her and then be recognized fol- tainly is the case. All of the arguments ment that was advanced by the chair- lowing her statement. that I have made in the past and many man of the Judiciary Committee in op- The PRESIDING OFFICER. The Sen- of the arguments that have been made position to Senator BYRD’s amend- ator from Kansas [Mrs. KASSEBAUM] is in the last few weeks are, in my mind, ments that are pending at the desk recognized. still valid. Unfortunately, Mr. Presi- dealing with the supermajorities. Mrs. KASSEBAUM. Mr. President, I dent, the arguments against this In that statement, he asserted as an appreciate the Senator from Massachu- amendment and my concern about cas- argument against Senator BYRD’s con- setts yielding for a few moments so I ual changes in the Constitution are tention that these supermajority re- can weigh in and offer my observations rendered almost irrelevant by another quirements here were running counter on the constitutional amendment that simple fact of our budget life. That fact to the prevailing theme of the Con- we have been debating over the past is that every day our Government stitution that a majority ought to pre- several weeks. issues scraps of paper marked IOU that vail, the fact that there were some During these debates, I think we are themselves becoming a deadly supermajority requirements put in the have heard some very thoughtful com- weight not only to future generations Constitution by the Founding Fathers, ments, both pro and con, on this impor- but to the Constitution itself. This for example, amending the Constitu- tant issue. This debate, in some ways, year, we will issue almost $500 million tion or overriding a veto. seems a fitting symbol for the amend- a day in IOU’s. Interest is piling up I wish to make the point that the ment itself which involves a great deal alongside those IOU’s high enough to very Founding Fathers who put those of talk without any specific action. consume 15 percent of our spending. To supermajorities into the Constitution As many of my colleagues know, I put that in perspective, the budget we considered at the time whether super- have long been an opponent of this pro- received a couple of weeks ago calls for majorities ought to be required in posed change in the Constitution of the us to spend almost as much money

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00037 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3176 CONGRESSIONAL RECORD — SENATE February 27, 1995 next year in interest as on defense. If icit, the President is bound by the Con- The Constitution gives Congress the only that meant our world had become stitution and his oath of office to bal- primary authority and responsibility peaceful and safe. Instead, what it ance the budget and prevent the def- with regard to raising and spending means is that we have put our grand- icit. funds. children in debt and the future of our Such a deficit could occur for a wide Article I, section 7 states that ‘‘all Government in danger. range of reasons. Congress may lack Bills for raising Revenue’’ must origi- Mr. President, I believe it is time to the political will to cast a vote author- nate in the House of Representatives. stop debating this amendment. It is izing a deficit as large as the one that Article I, section 8 grants Congress time to pass it, get it out of the way, it actually anticipates. Or, unantici- the powers ‘‘to lay and collect Taxes, take it off the list of excuses we con- pated decreases in revenue or increases Duties, Imposts and Excises,’’ and ‘‘to stantly use, and move on to the real in expenditures may result from nat- borrow Money on the credit of the issue, which is how to balance our Gov- ural disasters or from a downturn in United States.’’ ernment’s income with its expendi- the economy. tures, how to lay out a sound fiscal pol- In these circumstances, the proposed Article I, section 9 provides that icy every year. If this amendment constitutional amendment would give ‘‘[n]o Money shall be drawn from the works, then I will be glad to admit that the President the power, indeed the Treasury, but in Consequence of Appro- I was wrong to ever oppose it. I cer- duty, to impound appropriated funds to priations made by Law.’’ tainly hope it serves the purpose for prevent the unauthorized deficit from Changing the constitutional alloca- which it was intended. If it does not occurring. tion of powers that has served this work, then it will no longer be avail- That is not just my opinion. This country well for over 200 years would able as an excuse for failure to achieve commonsense reading of the proposed be a profound mistake. sound fiscal policy. constitutional amendment is shared by I support a statutory line-item veto, That, Mr. President, is my reason for a broad range of highly respected legal and I hope to be able to vote for one on supporting this constitutional amend- scholars and by the executive branch of the floor this year. But the impound- ment to balance the budget and why I the Government. ment authority given to the President believe it is important for us in the Assistant Attorney General Walter by this amendment is far broader than Senate to pass it this year. Dellinger, who as head of the Office of a line-item veto. Thank you. I yield the floor. Legal Counsel at the Department of The line-item veto simply allows the The PRESIDING OFFICER. By pre- Justice is responsible for advising the President to delete or reduce specific vious order, the Senator from Massa- President and the Attorney General on chusetts is recognized. items in an appropriations bill. But as the scope and limits on Presidential Assistant Attorney General Dellinger AMENDMENT NO. 267 authority, testified before the Judici- testified, the impoundment authority Mr. KENNEDY. Mr. President, I ask ary Committee that the proposed con- conferred upon the President by the unanimous consent that the pending stitutional amendment would author- proposed constitutional amendment amendments be temporarily laid aside ize the President to impound funds to would allow a President, confronted and that my amendment No. 267 be ensure that outlays do not exceed re- with an unauthorized deficit, to order placed before the Senate for the dura- ceipts. across-the-board cuts in all Federal tion of my remarks on the amendment. Harvard Law School Professor The PRESIDING OFFICER. Without programs, abolish entire programs, or Charles Fried, who served as Solicitor target expenditures intended for par- objection, it is so ordered. General during the Reagan administra- Mr. KENNEDY. Mr. President, during ticular States or regions for impound- tion, testified that in a year when ac- the debate on the proposed constitu- ment. tual revenues fall below projections tional amendment, we have heard prac- In the name of deficit reduction, the and a bigger-than-authorized deficit tically nothing from supporters of the President could freeze cost-of-living occurs, section 1 ‘‘would offer a Presi- proposal regarding how the amendment adjustments for Social Security recipi- dent ample warrant to impound appro- is to be enforced. The reason is clear: ents. He could abolish Medicare. He priated funds.’’ Others who share this The amendment would give the Presi- could slash defense spending. view include former Attorney General dent and the Federal courts unprece- Nicholas Katzenbach, Stanford Univer- In the past, Presidents from time to dented, and unacceptable, roles in de- sity Law School Professor Kathleen time have asserted that they had in- ciding how Federal funds are to be allo- Sullivan, Yale University Law School herent constitutional authority to im- cated. My amendment addresses the Professor Burke Marshall, and Harvard pound funds. This issue came to a head first of these issues—the powers of the University Law School Professor Lau- during the Nixon administration, when President. rence Tribe. President Nixon impounded $18 billion In its current form, the proposed con- By giving the President impound- from programs he wanted to terminate stitutional amendment would give the ment authority, the proposed amend- or reduce. President—in order to avoid an unau- ment would dramatically alter the al- He impounded $9 billion appropriated thorized deficit—the power to impound location of powers set forth in the Con- for water treatment facilities. He im- funds appropriated by Congress. Sec- stitution. As James Madison wrote in posed a moratorium on subsidized tion 1 of the amendment provides that: The Federalist No. 48, ‘‘the legislative housing. He cut back on disaster relief. [t]otal outlays for any fiscal year shall not department alone’’ has the power to He suspended rural and community de- exceed total receipts for that fiscal year, un- tax and spend. velopment programs. He withheld al- less three-fifths of the whole number of each most $2 billion from the Department of House of Congress shall provide by law for a So, Mr. President, as we mentioned specific excess of outlays over receipts by a here, we have broad views of different Labor and from the Department of rollcall vote. high administration officials who have Health, Education and Welfare. In other words, the constitutional served in the Justice Department or in Dozens of lawsuits were filed chal- amendment would flatly prohibit the White House, who are thoughtful lenging the legality of President Nix- spending from exceeding revenues, un- men and women and constitutional on’s actions. The vast majority of less both the House and the Senate au- scholars, who believe virtually unani- court decisions ruled against the im- thorize the deficit. mously, if you regard the hearings that poundment. In 1974, Congress finally Under article II, section 3 of the Con- were held on the balanced budget resolved the matter by passing the Im- stitution, the President has a duty to amendment by Senator BYRD as well as poundment Control Act to require the ‘‘take care that the Laws be faithfully by the Judiciary Committee—virtually appropriated funds to be spent—unless executed,’’ and article II, section 7, re- unanimously that this power of im- the President sends a rescission mes- quires the President to take an oath to poundment is very real and that the sage to Congress and Congress acts to ‘‘preserve, protect and defend the Con- President would have a duty to im- uphold the rescission. The balanced stitution.’’ pound; not just an option, a duty to im- budget amendment would scrap this ar- In any fiscal year in which it is clear pound should there be an imbalance be- rangement. As I mentioned, that is the that there will be an unauthorized def- tween receipts and outlays. law now. The Impoundment Control

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00038 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3177 Act since 1974 is the law guiding the Supporters also argue that Congress I urge my colleagues to support the whole issue of impoundment. can specify in the enforcement legisla- amendment. The balanced budget amendment tion required by section 6 exactly the Mr. HATCH. Mr. President, I wish to would scrap this arrangement, and fun- enforcement mechanism it wants, and respond to Senator KENNEDY’s im- damentally change the allocation of that the President, as Chief Executive, poundment argument. In each of the powers between the President and the is duty bound to carry out the congres- years the balanced budget amendment Congress. sional plan, to the exclusion of im- has been debated, I have noticed that In addition to granting authority to poundment. But just because Congress one specious argument is presented as the President to impound appropriated spells out one means of enforcing the a scare tactic by the opponents of the funds, the amendment would also en- amendment does not mean that the amendment. This year the vampire ris- able future Presidents to assert that President could not assert another ing from the grave is presidential im- they have the power unilaterally to means. raise taxes, duties, or fees—in order to As the Supreme Court recognized in poundment. Supposedly, a President, generate additional revenue to avoid In re Neagle, the President’s obligation when faced with the possibility of an unauthorized deficit. That was the to faithfully execute the laws is inde- budgetary shortfalls after ratification testimony of Assistant Attorney Gen- pendent of Congress. That duty is not— of the balanced budget amendment, eral Walter Dellinger, the chief legal * * * limited to the enforcement of facts of will somehow have the constitutional advisor to the executive branch, before Congress * * * according to their express authority—nay duty—to arbitrarily the Judiciary Committee this year. terms * * * it include[s] the rights, duties cut social spending programs or even This outcome would drastically and obligations growing out of the Constitu- raise taxes. transform the allocation of powers en- tion itself. * * * and all the protection im- plied by the nature of the government under I want to emphasize that there is visioned by the Framers. No longer the Constitution[.] nothing in House Joint Resolution 1 would the legislative department alone If an unconstitutional deficit were that authorizes or otherwise allows for have the power to tax and spend, as occurring, Congress could not constitu- impoundment. It is not the intent of Madison promised in The Federalist tionally stop the President from im- the amendment to grant the President No. 48. pounding appropriated funds in order any impoundment authority under The fact that the proposed constitu- to prevent it. As Prof. Kathleen Sul- House Joint Resolution 1. Indeed, tional amendment would confer im- livan testified, the proposed constitu- House Joint Resolution 1 imposes one poundment authority on the President tional amendment— new duty, delegates one new authority, is confirmed by the actions of the Judi- * * * if enacted would, of course, be con- on the President: To transmit to Con- ciary Committee this year. Supporters stitutional law, fundamental law. It would gress a proposed budget for each fiscal of the amendment opposed and de- trump [the Impoundment Control Act of year in which total outlays do not ex- feated my amendment that would have 1974] or any other statute designed to umpire ceed total receipts. In fact, there is a added the following section to the pro- disputes between the President and Con- ripeness problem to any attempted im- posed amendment: gress. poundment: Up to the end of the fiscal Nothing in this article shall authorize the In short, the only certain way to see year the President has no plausible President to impound funds appropriated by that the President is not given im- basis to impound funds because Con- Congress by law, or to impose taxes, duties poundment authority is by adopting gress under the amendment has the or fees. the Kennedy amendment. power to ameliorate any budget short- If the supporters of the proposed con- This does not even take into consid- falls or ratify or specify the amount of stitutional amendment to do not in- eration the fact that if you have subse- deficit spending that may occur in that tend to give impoundment authority to quent enabling legislation, as sug- fiscal year. the President, there is no legitimate gested by those who support it, that explanation for their failure to include the President might veto it. He way Moreover, under section 6 of the this clear prohibition in the proposed say, ‘‘No, I believe that the statements amendment, Congress must—and I em- amendment. and the positions that have been ex- phasize must—mandate exactly what Supporters of the constitutional pressed by Charles Fried and former type of enforcement mechanism it amendment make two arguments to Attorney General Katzenbach and So- wants, whether it be sequestration, re- support its assertion that the proposal licitor General Archibald Cox and Wal- scission, the establishment of a contin- would not give the President impound- ter Dellinger and Kathleen Sullivan gency fund, or some other mechanism. ment authority. Both are wrong. give me the power to do that. They The President, as Chief Executive, is They argue that there will never be give me the power to do it so I am duty bound to enforce a particular req- an unauthorized, and therefore uncon- going to veto the implementing legisla- uisite congressional scheme to the ex- stitutional, deficit, because Congress tion.’’ And what is to say what would clusion of impoundment. That the will always step in at the end of the be the outcome of such a veto? President must enforce a mandatory year and ratify whatever deficit has oc- My amendment will make clear that congressional budgetary measure has curred. nothing in the balanced budget amend- been the established law since the nine- That is like arguing the President ment gives the President authority to teenth century case of Kendall v. United has the unilateral power under the impound appropriated funds or impose States ex rel. Stokes, 37 U.S. (12 Pet.) 542 Constitution to declare war, because taxes, duties, or fees. (1838). In Kendall, Congress had passed Congress will always step in to ratify a My amendment will not limit Con- a private act ordering the Postmaster Presidential declaration. gress’ power to give the President line- General to pay Kendall for services If their prediction is accurate, then item veto authority. I will not limit rendered. The Supreme Court rejected the balanced budget amendment is a the authority already given to the the argument that Kendall could not sham, because it would impose no fis- President elsewhere in the Constitu- sue in mandamus because the Post- cal discipline whatsoever. But if the tion, and by the Budget Control and master General was subject only to the prediction is wrong—if Congress failed Impoundment Act. All it will do is orders of the President and not to the to act before the end of a fiscal year to specify that the proposed constitu- directives of Congress. The Court held ratify an unauthorized deficit—then all tional amendment does not give the that the President must enforce any of the expenditures by the Federal Gov- President the power to impound appro- mandated—as opposed to discre- ernment throughout the fiscal year priated funds or impose taxes, duties, tionary—congressional spending meas- would be unconstitutional and open to or fees. ure pursuant to his duty to faithfully challenge in the State and Federal We should not sign over to the Presi- execute the law pursuant to article II, courts. it is inconceivable that the dent the power that Congress has had section 3 of the Constitution. The Ken- President, sworn to preserve, protect over the purse for over 200 years, sim- dall case was given new vitality in the and defend the Constitution, would be ply because some Members lack the po- 1970’s, when lower Federal courts, as a found to be powerless to prevent such a litical courage to make the tough deci- matter of statutory construction, re- result. sions needed to balance the budget. jected attempts by President Nixon to

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00039 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3178 CONGRESSIONAL RECORD — SENATE February 27, 1995 impound funds where Congress did not Mr. ASHCROFT. Mr. President, in deeper and deeper into debt. Unfortu- give the President discretion to with- 1788, Alexander Hamilton recognized nately, while the Senate cannot bind hold funding. For example, State High- that deliberations on the Constitution the next Senate, the Senate certainly way Commission v. Volpe, 479 F.2d 1099 would by no means be, as he put it, binds the next generation to the cur- (8th Cir. 1973). Unless Congress grants ‘‘decorous and genteel.’’ Much too rent debt. the President impoundment power, the much was at stake. Instead, he pre- So, when we are talking about a President, as a practical matter, will dicted there would be ‘‘a torrent of group that is yet to come into exist- not be able to impound funds under angry and malignant passions’’ that ence—the next generation of Ameri- this amendment. would be let loose during ‘‘the great cans whose toil has not yet produced Let me stress again that section 6 of national discussion.’’ the first of its wages—I think it is es- House Joint Resolution 1 requires Con- Well, Mr. President, we are having a sential that we have the capacity to re- gress to enforce and implement the great national discussion. We can be quire a supermajority vote. amendment by appropriate legislation. thankful that we are having it on a Mr. President, in the deliberations This is not a delegation of power to basis which is appropriate and genteel. we also frequently hear that there is no Congress, similar to that of the 14th, At the same time, we must answer need for us to have this kind of amend- 15th, 16th, and 19th amendments, some of the charges that have been ment to the U.S. Constitution. It is ar- whereby Congress has the discretion made, as well as examine further some gued that there is authority now for whether or not to exercise its enforce- of the arguments that are being raised the U.S. Congress to do what is right. ment power. Congress must enforce the against the balanced budget amend- There is authority for the U.S. Con- balanced budget amendment by appro- ment. gress to do what is right and to live priate legislation. This is a powerful Just moments ago, in this Chamber, within its means. statement that evidences a preclusion the Senator from Maryland came to us Frankly, it is only part of what a of unilateral presidential action. with the suggestion that the super- Constitution stands for, what a Con- The position that section 6 imple- majority that is required in this stitution’s function is, to provide au- menting legislation would preclude amendment—and, as we all know, in thority to do what is right. The other Presidential impoundment was sec- the proposed amendment there is a half of the Constitution’s function and onded by Attorney General Barr at the supermajority of 60 percent required to purpose is to prohibit that which is recent Judiciary Committee hearing on raise the national debt—is undemo- wrong. If we come to the conclusion the balanced budget amendment. Testi- cratic to the extent that it inappropri- that spending the resources of the next fying that the impoundment issue was ately gives to a minority of people, the generation is wrong, we cannot rely on in reality incomprehensible, General 40 percent, the right to block the will the fact that there is authority in the Barr concluded that ‘‘the whip hand is of the 60 percent. Constitution for the Congress to act I agree that it is important for us all in Congress’ hand, so to speak; under properly. We must prohibit the Con- to agree that we do not want to have section 6 [the] Congress can provide the gress from doing that which is wrong. supermajority requirements every- enforcement mechanism that the The mere authority to do that which where, particularly where it is not im- courts will defer to and that the Presi- is right has been insufficient. We have portant. But we also know that the dent will be bound by.’’ had in the last 60 years only seven bal- Further, the notion that Congress Constitution itself contains a variety anced budgets. We have had authority would stand idly by while the Presi- of supermajorities that are included in to balance the budget in every one of dent threatens to, or, in fact, does in- the Constitution because there are those 60 years, yet we have not had the vade Congress’ spending authority, is some things it is vital to protect. fiscal discipline to balance the budget. not realistic as a practical matter. We Indeed, the Senator from Maryland It is agreed, we have had the authority simply would not stand for it. pointed out that we have a super- to do what is right. What we need now What we have here then, is an argu- majority requirement for overriding is a prohibition against doing what is ment based on a remote possibility. the President’s veto. But the reasoning wrong. Under the remote possibility scenario behind prohibiting supermajorities in of an impoundment, we would have to the main is to keep one group from un- It is wrong to spend your neighbor’s preclude any possibility, however, re- duly imposing its will on another resources. It is wrong to take those mote, in the amendment. The amend- group. The reason we believe generally things which are not yours. It is simply ment would look like an insurance pol- in simple majorities is that we believe wrong. It is part of the consensus that icy. Why preclude something in the that people who are represented ought we all have when we first understand Constitution that in strong probability to be represented on an equal footing. right from wrong. Yet we in Congress could never happen, and which Con- However, there is a special situation continue to recklessly spend the re- gress could preclude by legislation? about which we debate here today con- sources of the next generation without Finally, the Kennedy amendment, as cerning the national debt. And it is not their consent. worded, would prohibit Congress from about one group in America displacing The idea of placing a prohibition on delegating to the President in imple- the cost of its consumption to another the actions of Congress is not new. As menting legislation any rescissionary group now existent in America. What a matter of fact, as a precondition for authority. This is what Congress did in we are talking about is the displace- ratifying the U.S. Constitution, the Gramm-Rudman-Hollings. Why limit ment of the costs of current programs States demanded that there be a Bill of the tools that Congress may employ to that we now benefit from onto the next Rights that clearly curtailed the abil- balance the budget in the future? generation, who are not currently rep- ity of Congress to do things that were As to the President’s hypothetical resented at all. It is in truth a problem wrong. The first five words of the Bill power to raise taxes, this is not even a about allowing one group to impose its of Rights are ‘‘Congress shall make no remote possibility. It is a constitu- will on another group—another group law.’’ tional impossibility. President’s sim- upon whom this debt is being imposed Again, I reiterate Mr. President, it is ply do not have the power to raise who are not even here to protest. very important that the Constitution taxes and the balanced budget amend- Mr. President, we have tried over and not only include authority to do that ment does not alter this. This power is over again as a body—in the United which is right, but to prohibit the Con- exclusively delegated to Congress by States—to somehow preclude this re- gress from doing those things which the Constitution in article 1. All the curring debt problem by binding the are wrong. And this is a fundamental balanced budget amendment does is to next Senate. We had the Gramm-Rud- function of the Constitution that is as limit Congress’ spending, taxing, and man-Hollings Act, then we had GRAMM– old as the Bill of Rights and the Con- borrowing powers. Rudman, and then we had the budget stitution itself. Several Senators addressed the deals of 1990 and 1993. We have not been It is in this context, then, that we Chair. able to get one Senate to bind the next need a balanced budget amendment to The PRESIDING OFFICER. The Sen- Senate to the necessary discipline to the Constitution. When you think of ator from Missouri. restrain this Government from going the things which were said by those at

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00040 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3179 the beginning of this Republic which I commence by saying that it is my ment. The history of the United States inspire us now—such as Nathan Hale intention to vote for the balanced is that we have had 27 constitutional saying on his way to the gallows, a pa- budget amendment. I do so with great amendments. With the exception of the triot willing to give his life, ‘‘I regret regret. I consider the very debate that amendment on prohibition that was re- that I have but one life to lose for my we are having today, and over the past pealed some 13 years after it was adopt- country.’’ I think sometimes that the several days, an admission of failure. It ed, no other amendment has been re- Congress regrets that there are but one is an admission of failure in a basic pealed. No other amendment has been or two generations to pay for the ex- quality of the American character, and modified. So I am operating on the as- cesses of the Congress. that is the quality that each genera- sumption that what we pass in this As a matter of fact, I do not believe tion has not only the responsibility to Senate, what the States ratify, will be we can have any confidence that the attend to its own affairs, but to leave in the Constitution of the United debt which we now have could be paid this country as a stronger and better States for the foreseeable future. And off within one generation, or even per- place for our children and grand- it is against that long stretch of time haps within two generations. But I do children. That, in fact, has been the that we must evaluate whether this have confidence that if we now take history of America for over 200 years. amendment meets our rhetoric and the this act of principled discipline and Regrettably, it is the generation of our public’s expectation. begin to prohibit our profligate spend- children that may be the first genera- ing, we will begin to move away from In my opinion, the combination of tion to find that they are not better the provisions in section 1, which pro- the kind of deficits which have charac- off, that they do not have greater op- terized this country for far too many vide that total outlays for any fiscal portunities personally, economically, year shall not exceed total receipts for years. educationally than did our generation It is in this context that we must any fiscal year; section 2, which states and preceding generations. that the limit on the debt of the United have this great discussion, Mr. Presi- We have broken that contract, that dent. It is in this context that we must States held by the public shall not be intergenerational contract of America. increased without a three-fifths vote; understand the need for the U.S. Con- The balanced budget amendment, gress to send to the States for ratifica- and section 7, which states that total therefore, is the regrettable response tion an amendment to the Constitution receipts shall include all receipts to to that broken contract. If there were which would impose upon the Congress the U.S. Government, total outlays reason to believe that we were prepared of the United States the very same dis- shall include all outlays of the U.S. to reform Federal spending without cipline under which virtually every Government, results in a constitu- having to go to the draconian extreme State in the United States operates. tional amendment that will tolerate— It is the discipline of practice, of liv- of a constitutional amendment, with will almost assure that we will grow ing within the resources that are avail- all of its implications, many of which the national debt by $3 trillion over the able, of living within the resources are unforeseen, if we had not broken next 25 years. that contract, if we had shown some which have been contributed by those While the public is being led to be- whose representatives are in the elect- discipline in the past or demonstrated our serious intention to do so in the fu- lieve that we are passing an amend- ed bodies—the legislative branches of ment that is going to assure fiscal re- the States. We should engage in the ture, then I would not vote for this constitutional amendment. But the sponsibility, we are going to be passing same practice at the national level. In- an amendment that will almost have deed, we should live within the re- fact is that we have done neither. We have been profligate in the past, and the opposite effect of assuring a dra- sources that we are willing to gather matic increase in our national debt. now—we should not attempt to take every indication is that we will con- the resources of the next generation. tinue to be in the future. How is that going to happen? Well, The ability to take the resources of I will cite two examples from each of the first component of that, as this the next generation is unique to the the major political parties. The Presi- chart indicates, is going to happen U.S. Congress. No family in America dent has submitted a budget this year whatever we do. Between now and the finds its children encumbered by the which calls for approximately a $200 year 2002, which is the earliest fiscal debts of their parents. No matter how billion addition to our national debt— year to which this amendment will profligate the spending of a father may $200 billion of deficit, and about the apply, we are going to add approxi- be, the children are not asked to en- same level of projected deficit through mately $1 trillion to our current $4.942 dure the debts of the father. While the the next 5 years. The Republicans’ Con- trillion national debt. So that we will Congress cannot bind the next Con- tract With America calls for a balanced reach the year 2002 with a national gress, it can and does bind the next budget, but it also calls for increased debt of $6 trillion. It is the next $2 tril- generation. It is time for the Constitu- spending, particularly in the area of lion that we have the opportunity to tion to be amended so that we do in- Defense, and it calls for tax cuts which, avoid. The combination of those three deed curtail this practice which de- over the next 10 years, will cost the sections that I summarized will provide prives individuals affected of represen- Treasury in excess of $700 billion. that we will account for our national tation—a practice, again, which im- Neither the President’s budget nor deficit by an accounting system that poses on the next generation a kind of the Republicans’ Contract With Amer- says you take in all of the income and taxation, a kind of confiscation of their ica adds up. Thus, we are at the point you subtract all of the expenditures, wealth without any participation that we are considering a constitu- and if you are in balance on that basis, whatsoever in the development of the tional amendment to place shackles on then you have met the strictures of the priorities their resources are allocated ourselves so that we will not be as able constitutional amendment. to sin in the future as we have in the for. The fact is that for the next period, It is wrong, Mr. President, and we past. from now until approximately the year need to stop it. I yield the floor. My criticism of this amendment, Mr. 2018, our Social Security Program is Mr. GRAHAM addressed the Chair. President, is that its reality does not The PRESIDING OFFICER. The Sen- live up to its rhetoric. It is less than it going to be generating enormous sur- ator from Florida. is purported to be; it is less than it pluses. These surpluses will reach a peak of over $3 trillion—a $3 trillion AMENDMENTS NOS. 259 AND 298 should be. It is not, as it has been de- Mr. GRAHAM. Mr. President, on Fri- scribed by some of its most fervent ad- Social Security surplus. Every one of day, I proposed two amendments, vocates, the ironclad amendment that those dollars generated as a surplus in which will be voted on tomorrow. I will protect the fiscal future of Amer- the Social Security system is a dollar would like to use this opportunity to ica. against which we can spend for any briefly discuss those amendments, and This amendment, however, is likely purpose. Use of the surplus will not be why I believe they are so critical, prior to be a permanent part of the Constitu- limited to Social Security spending. to the passage of this constitutional tion of America in the form that we So the effect of this amendment, amendment and its possible ratifica- submit it to the States. I believe the with its requirement that Social Secu- tion by the States. States are likely to ratify this amend- rity be integrated into the rest of the

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00041 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3180 CONGRESSIONAL RECORD — SENATE February 27, 1995 Federal budget, is to tolerate a $2 tril- [From the Washington Post, Feb. 26, 1995] dramatically shrinking size of government— lion increase in the national debt be- CONGRESS MAY ASK HISTORIC GAMBLE BY dismantling or repackaging large chunks of tween now and the year 2018. STATES it. Sen. Connie Mack (R–Fla.) said last week, BALANCED BUDGET AMENDMENT VARIOUSLY ‘‘This is a fundamental debate about those But it could be worse, Mr. President. CHARACTERIZED AS OFFERING ‘‘GLIDE PATH’’ who believe more government will solve our If, for instance, this or future Con- OR CRASH problems and those who believe less govern- ment, less taxing and less spending will give gresses decide to manipulate Social Se- (By Eric Pianin) us more freedom.’’ curity and the handful of other trust If the Senate approves the proposed bal- As a foretaste, Republican House appropri- funds that will be contributing to this anced budget amendment Tuesday, Congress ators last week voted to cut $17 billion from large debt held by Social Security and will ask the states to take a historic gamble current spending for housing, health care, other trust funds, we can have further that some say will free future generations from onerous debt and others warn could nutrition, clean water, job training and opportunities to spend, cut taxes, and other programs. Moreover, the House Eco- still appear to be balancing the budget. ruin the economy, disrupt vital government services and devastate the social safety net. nomic and Educational Opportunity Com- The aviation trust fund provides us For nearly 60 years, the fight over a con- mittee voted to repeal the National School stitutional amendment to force the govern- Lunch Act and fold school feeding and other with a good example of how Congress nutritional programs for the poor into block has misused a Federal trust fund. ment to live within its means except in times of war has largely been an academic grants for states to administer. Every time an American or a foreign exercise. But in the wake of the Republican While these budgetary actions caused an visitor purchases an airline ticket takeover of Congress, the House has over- uproar among angry Democrats and social within the United States, they must whelmingly approved the measure, 300 to 132, welfare activists, the cuts and program pay a Federal transportation tax. The and supporters in the Senate are within a changes were a drop in the bucket compared tax revenue then goes into an aviation couple of votes of the two-thirds majority with what would be required under a bal- trust fund. Legislation passed by this needed to adopt the amendment and send it anced budget amendment. Congress stated that the proceeds of on to the states for ratification. Studies by the Congressional Budget Of- Republican leaders—including House Budg- fice, the Treasury and Center on Budget and that trust fund were to be used to fi- et Committee Chairman John R. Kasich Policy Priorities show Congress would have nance America’s aviation system. It (Ohio) and Senate Judiciary Committee to reduce projected spending over the next helps to pay for the very complex com- Chairman Orrin G. Hatch (Utah)—say pas- seven years by as much as $1.4 trillion to bal- munications system that protects the sage of a balanced budget amendment is es- ance the budget and pay for the Republicans’ navigation and the safety of aircraft. It sential to GOP plans to impose fiscal dis- $200 billion package of tax cuts. In the year goes, in part, to expanding our system cipline on an unruly and often cowardly Con- the proposed amendment would take effect, gress and put the government on a seven- 2002, Congress would have to cut an esti- of airfields and airports and terminals year ‘‘glide path’’ to eliminating the deficit. and other activities which benefit avia- mated $357 billion of spending to meet the With a balanced budget amendment in constitutional requirement. tion in this country. place, they insist, the Republicans can cut The Republicans have promised a rel- taxes, protect Social Security from reduc- atively painless prescription for achieving The fact is that for a period of years, tions, beef up defense and still eliminate the the deficit, by redesigning costly entitle- particularly during the 1980’s, we did deficit by the year 2002—all without much ment programs like Medicare and Medicaid, not spend the money that was coming upheaval or suffering. into that aviation trust fund. The pri- ‘‘It isn’t like we’re trying to haul a Mack consolidating other programs into block grants and slowing the rate of growth of mary reason we did not spend the truck—attach ourselves to a Mach truck— and then pull it 100 yards with the power of spending from a projected 5.4 percent to 3.2 money was not because we had sud- percent. denly decided we were going to become our own bodies,’’ Kasich said recently. ‘‘There’s an impression out there this is ‘‘I won’t call it horrific cuts,’’ said Sen. extra conservative in the area of avia- somehow impossible or terribly difficult. It’s Larry E. Craig (R–Idaho), a leading pro- tion spending, but rather because every not that at all.’’ ponent of the balanced budget amendment. dollar we did not spend out of that But critics—such as Sens. Robert C. Byrd ‘‘I’m talking about reductions of the rates of trust fund added to its surplus and con- (D-W.Va.), Paul S. Sarbanes (D-Md.) and growth. There isn’t going to be one dime cut tributed to the masking of the Federal Paul D. Wellstone (D-Minn.)—warn the oppo- below this year’s budget in next year’s spending.’’ budget deficit. I think that while we site: If the amendment is approved, it would make the government powerless to respond But liberal and conservative policy groups were artificially reducing the reported quickly to recessions and other economic say the ‘‘glide path’’ to a balanced budget deficit, we were tragically contributing crises and force dismantling of agencies and will be far bumpier than the Republicans let to a degeneration of the best aviation programs crucial to the poor and the middle on. Also, it will be virtually impossible to safety system in the world. And we are class. balanced the budget in seven years if Repub- all aware of some of the recent con- Others, including Sen. Sam Nunn (D-Ga.), licans insist on fencing off large portions of sequences of that degeneration. So I do also argue the amendment would disrupt the the federal budget from spending cuts, they not believe that we ought to be encour- balance of power among the three branches say. aging Congress to continue that pat- of government, strengthening the hand of ‘‘You have to be willing to take down de- the president to impound funds any time tern of behavior. fense and future Social Security benefits, Congress violated the constitutional stric- and you have to meanstest Medicare and you Finally, let me say on this point, Mr. tures and opening the door to judicial inter- have to eliminate a lot of cats’ and dogs’ pro- President, I am concerned that some of vention on congressional fiscal policy. grams,’’ said William Niskanen, an economic the strongest advocates of this con- Critics also complain Republicans have re- adviser to the Reagan administration and fused to detail how they intend to achieve a head of the Cato Institute, a conservative stitutional amendment are contrib- balanced budget within seven or eight years. uting to this public perception that we think tank. ‘‘Arithmetically, it’s not dif- And they say the Social Security trust fund ficult to do, but that begs the question of are going to be passing an ironclad con- would become an irresistible target for budg- whether it’s politically difficult.’’ et-cutters early next century, despite assur- stitutional amendment. Let me just Under the amendment, the president would ances from House Speaker Newt Gingrich (R– refer to a few of the statements that be obliged to submit a balanced budget each Ga.) and Senate Majority Leader Robert J. were published over this weekend and year and Congress would have to adopt a Dole (R–Kan.) that Social Security would be which caught my attention. I am cer- budget with outlays no greater than the pro- exempted. jected revenues for the coming year, unless tain they also caught the attention of ‘‘No one is going to escape the wrath of the three-fifths of the House and Senate agree to many of my colleagues. balanced budget mandate,’’ Byrd said in a re- allow a deficit. cent Senate speech. First was an article in the Wash- The amendment would also require a ington Post, dated Sunday, February The new Republican leadership has pre- mised much of its economic and budgetary three-fifths majority in each chamber to 26, entitled ‘‘Congress May Ask His- strategy on passage of the budget amend- raise the ceiling on the amount of debt the toric Gamble by States,’’ a discussion ment, centerpiece of the House GOP’s ‘‘Con- government can incur, and a simple majority of this constitutional amendment. I tract With America.’’ Many proponents favor to raise taxes. The provisions would be ask unanimous consent that the text of the amendment on moral grounds, saying its waived in times of war or threats to national this article be printed in the RECORD. adoption would help spare their children and security. grandchildren from the economic burdens of Although it is called a balanced budget There being no objection, the article a national debt approaching $5 trillion. amendment, the measure does not guarantee was ordered to be printed in the Passage of the balanced budget amendment a balanced budget in any year, only that RECORD, as follows: is also a vital pretext for the larger goal of Congress certifies it is attempting to stay

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00042 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3181 within the project revenues. If, as commonly Mr. GRAHAM. Mr. President, in this oric? The principal consequence of this happens, revenue or spending estimates article, this statement appeared: deficiency in reality as opposed to the prove faulty, the government could still The amendment would also require a rhetoric with which the amendment is close its books showing a deficit. However, if three-fifths majority in each Chamber to annual deficits get out of hand and push the being sold is going to be aimed, tar- raise the ceiling on the amount of debt the overall national debt to the legal ceiling, it geted, focused on our Social Security Government can incur. would take a three-fifths ‘‘supermajority’’ to system and primarily on those Social raise the limit to allow additional bor- It goes on to state: Security beneficiaries born after the rowing. If annual deficits get out of hand and push year 1954. The biggest problem with the amendment, the overall national debt to the legal ceiling, If you were born after the year 1954— critics say, is that it would rob the Congress it would take a three-fifths supermajority to of flexibility in responding to economic cri- and I see some people in this Chamber raise the limit to allow additional bor- who I think meet that standard—lis- ses, such as recessions, or emergencies simi- rowing. lar to the mass failures of savings and loan ten: Social Security is going to be used associations. Programs like unemployment That is clearly untrue. to mask the extent of the real deficits insurance, food stamps and other welfare The constitutional amendment in the of the United States. benefits currently kick in automatically clearest words—and it is ironic that Let me just give you a few figures at whenever unemployment surges. But under a the text of the amendment was printed 5-year intervals. In 1980, the reported balanced budget amendment, it would take inside the article that I have just national debt—this is reported on inte- supermajorities in the House and Senate to read—states that ‘‘the limit on the approve the emergency funding. grated, budgeted, total revenues versus ‘‘That kind of extreme fiscal policy makes debt of the United States held by the total receipts including Social Secu- a small recession worse,’’ President Clinton public’’—held by the public—‘‘shall not rity—the deficit was reported at $73.8 said in his radio address yesterday. ‘‘In its be increased without a three-fifths billion in 1980. When you look at the most exaggerated form, it’s what helped turn vote.’’ Social Security trust fund in 1980, the the economic slowdown of the 1920s into the By the year 2018, only approximately Great Depression of the 1930s.’’ Social Security trust fund was running half of the total national debt will be in a deficit. It had a deficit of $1.1 bil- TEXT OF PROPOSED AMENDMENT held by the public. The rest of the na- lion. So the real deficit of the general Following is text of proposed balanced tional debt will be held primarily by budget amendment: operations of Government was $72.7 bil- Social Security and other Federal trust lion; that is, the reported deficit minus Resolved by the Senate and House of Rep- funds which are not subject to the limi- resentatives of the United States of America the degree to which it incorporated the in Congress assembled (two-thirds of each tation of this constitutional amend- necessity to finance the deficit of So- House concurring therein). That the fol- ment. cial Security. In a response to the President on lowing article is proposed as an amendment By 1985, the reported deficit had to the Constitution of the United States, Saturday, one of our colleagues made jumped to $212.3 billion. And by 1985, as which shall be valid to all intents and pur- this statement. poses as part of the Constitution when rati- a result of the changes made in Social Americans know this measure would re- Security in 1983 when Social Security fied by the legislatures of three-fourths of quire Washington to start living within its the several states within seven years after means and balancing its budget like families was converted from a pay-as-you-go the date of its submission to the states for and most State governments must do. That’s system to a surplus system—one that ratification: why about 80 percent of Americans support had this print line of developing large ARTICLE — it. surpluses in order to be prepared to SECTION 1. Total outlays for any fiscal year If 80 percent of Americans believe meet the needs of that population shall not exceed total receipts for that fiscal that this would require Washington to largely born after World War II and year, unless three-fifths of the whole number particularly after 1954—we had a sur- of each House of Congress shall provide by start living within its means and oper- law for a specific excess of outlays over re- ating like a typical American house- plus of $9.4 billion. So the real deficit ceipts by a roll call vote. hold, they are supporting this amend- in the general accounts of the Federal SECTION 2. The limit on the debt of the ment for the wrong reasons and they Government, that is everything other United States held by the public shall not be are about to be severely disappointed. than Social Security, was $221.7 billion. increased, unless three-fifths of the whole Finally, on one of the Sunday talk That is 1985. number of each House shall provide by law In 1990, the reported deficit, $221.4 for such an increase by a roll call vote. shows, one of our colleagues, in dis- SECTION 3. Prior to each fiscal year, the cussing the amendment, challenged a billion. The real deficit, after you president shall transmit to the Congress a statement that this amendment would eliminate the mask of Social Security proposed budget for the United States gov- require 60 votes to raise taxes, cor- surplus, was $279.6 billion. ernment for that fiscal year, in which total rectly challenged that statement by In 1995, reported deficit, $176 billion. outlays do not exceed total receipts. saying: It would appear that we had made sig- SECTION 4. No bill to increase revenue shall nificant progress in controlling the def- become law unless approved by a majority of No, you don’t need 60 votes under this the whole number of each House by a roll amendment to increase revenues. You need icit. But because there has been a sig- call vote. 60 votes to increase the debt ceiling. nificant increase in Social Security SECTION 5. The Congress may waive the That is not what the amendment pro- surpluses, the real deficit was $245 bil- provisions of this article for any fiscal year vides. You do not need 60 votes to in- lion, or not so much progress. By the in which a declaration of war is in effect. crease the debt ceiling. You need 60 year 2000, according to the Congres- The provisions of this article may be waived votes to increase the amount of debt sional Budget Office’s latest report, for any fiscal year in which the United held by the public, which will be by the dated January 1995, the reported deficit States is engaged in military conflict which will be $284 billion. The Social Security causes an imminent and serious military year 2018 only about half of our na- threat to national security and is so declared tional debt. All the other debt that the surplus will equal $96 billion. So the by a joint resolution, adopted by a majority Government borrows is outside of the real deficit, the deficit in all of our on- of the whole number of each House, which three-fifths requirement. And it is that going governmental accounts, will be becomes law. other availability of borrowing that is $380 billion—$380 billion. SECTION 6. The Congress shall enforce and going to drive our national debt to al- That is just a foretaste of what it implement this article by appropriate legis- will be like 5 years later when, accord- lation, which may rely on estimates of out- most $8 trillion by the year 2018. lays and receipts. I have one other item from the week- ing to the Congressional Budget Office, SECTION 7. Total receipts shall include all end news that I want to discuss in a we have a reported deficit of $421 bil- receipts of the United States government ex- moment where I think there has been a lion and a Social Security surplus of cept those derived from borrowing. Total misstatement. $137 billion for a real deficit of $558 bil- outlays shall include all outlays of the So these are some of the realities of lion. That is what we are experiencing United States government except for those the amendment that we are about to in terms of the direction of the budget. for repayment of the debt principal. SECTION 8. This article shall take effect be- pass. It is an amendment which does That brings me to my fourth and ginning with fiscal year 2002 or with the sec- not live up to its rhetoric. What is final weekend news communique. A ond fiscal year beginning after its ratifica- going to be the principal consequence leading Washington Post columnist tion, whichever is later. of this gap between reality and rhet- wrote in an article entitled ‘‘Fool’s

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00043 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3182 CONGRESSIONAL RECORD — SENATE February 27, 1995 Amendment,’’ that the redink hemor- surplus to fund our annual deficits and They estimate that it will cost rhage this constitutional amendment add $12 trillion to that national debt. $10,000 a year per child to send them to is supposed to stop is not a chronic We are facing, Mr. President, a gigan- college. What do the Joneses do? Do condition, it is actually a phenomena tic truck wreck beginning in about the they put the $15,000 aside in some trust of the 1980’s which has washed over year 2015. We are still operating in a fund to meet this obligation to send into the 1990’s, but it is a dubious prop- surplus, but the rate of increase in that their children to school, as their be- osition to rewrite the permanent char- surplus is beginning to decline. I re- loved uncle wanted? No. They take the ter of Government to correct for the member an old joke told about a truck- money and they start to spend it. They follies of one decade. er who was in a class, studying new actually increase their annual spending I am afraid, my friends, that the techniques in driving trucks. The from $50,000 up to $55,000, so now they facts indicate this was not just a dec- teacher used a method of instruction in are spending the $40,000 they make and which he would ask students different ade-long aberration, that we did not the $15,000 they got from their favorite hypothetical questions to see how they just lose our way for one 10-year pe- uncle, and they live very well for the would respond in emergency situations. riod. In fact, we seem to have lost this next 10 years. fundamental character of America of One of the questions that was asked generational responsibility. We are was, ‘‘Joe, suppose you are riding on a At the end of the 10 years, the $15,000 masking the extent to which we are mountainous road in northern New no longer is there. They are back to lost by these increasing Social Secu- Mexico. You are 200 yards from the top $40,000, having gotten themselves into of the hill, and you look up and there rity surpluses. We are lost with no in- the lifestyle of a $55,000-a-year family, is another truck that has just crested dication that we are about to find a and they have this obligation to send the hill. You can tell it is out of con- compass. their two children to college. trol, and you can tell it is going over Why is Social Security in the target 100 miles an hour. What would you do?’’ It is not far off from what our family of this issue? It is because that any fu- Joe said, ‘‘I would turn to my relief of America will face in about the year ture attempts to reform Social Secu- driver, Ray, who is sleeping in back of 2018. We will no longer have the Social rity—and clearly Social Security cries me, and wake him up.’’ The driver was Security surplus, but we will have to out for some reform—are going to be shocked. ‘‘You would do what? You meet the retirement obligations that stymied by the fact that those very re- would wake up your relief driver in we have made to our older Americans. forms will be seen as, and in fact will that kind of an emergency situation?’’ We are setting up another type of be, means to further mask the deficit. Joe said, ‘‘I sure would, because Joe clash, and that will be a confrontation Those reforms will not be used for the never has seen a truck wreck like the between classes of Americans. We are principal purpose of assisting Social one we are about to have.’’ setting up a potential confrontation Security to be a sound, reliable, retire- Well, friends, we need to wake up between those Americans who will be ment system for the indefinite future. America because we have not seen a in the work force in the decade of the They will be used as a means of gener- truck wreck like the one we will have 2020’s and those Americans who will be ating additional surplus so we can have which will begin in about the year 2015, retired, because we will be asking those even more spending, even more tax no longer having the enormous annual people in the work force to work hard- cuts, even more borrowing. surpluses but reversing to the point er. There will be fewer of them to sup- Third, the increased national debt where we will have deficits. port the large number of retirees. We will lead to increased national annual And what type of deficits? The period will ask them to pay excessively higher debt payments. Under this constitu- of about the year 2020 or 2025—and it taxes in order to meet those accumu- tional amendment, the amount of def- sounds like a long time from now; we lated obligations. icit that we will add from the year 2002 hope we will be here to see it—about through the year 2018 will be between that time, we will be running deficits Further, there will not be the kinds $120 billion and $140 billion. That is $120 in the Social Security of in the range of student financial aid that maybe the billion to $140 billion that our children of $350 billion to $400 billion a year. We Jones family thought they would get and grandchildren and their children will be spending out that much more for their two children because we can- and grandchildren are going to be than we will be taking in. That is not not afford student financial aid any- asked to pay. an aberration. That is the way the sys- more. There will be no net national savings tem was designed in order to create a There is going to be a generational core of assets that will be able to meet increase as a result of this amendment clash in America. There could also be a this future demand. between 1995 and the year 2018. clash between older Americans and bet- If you could analogize this to a Mr. President, we reformed the So- ter-off Americans. There is going to be household, the Jones household has cial Security system in the early 1980’s, a temptation to manipulate Social Se- earnings of $40,000. Unfortunately, the in order to build a surplus to meet our Joneses have not been very prudent curity in order to make the surplus future obligations. By statute, that and they have gotten into a pattern even greater so that some of those obli- fund can only be invested in a par- over the last 2 or 3 years of spending gations in the Contract With America ticular form of Treasury notes which, $50,000. So every year, their indebted- that have this $700 billion-plus price incidentally, are restrained so they are ness goes up and they get a little more tag from now until the year 2005 can be nontransferable. How are we going to in the hole. Well, good news and bad met. This concerns me. pay for all those notes when this large news has just occurred for the Jones wave of Americans, particularly those So we are going to be fraying the family. Their favorite uncle died, and basic social relationship between and born after 1954, arrive and begin to ask the uncle left an inheritance, part of for their benefits? among important groups of Americans. which goes to the Jones family. And we are doing all of this, Mr. Presi- The theory was that the rest of the Now, this is a somewhat unusual in- dent, unnecessarily. We do not have to national budget would be in balance heritance. The Jones family is going to do this in order to pass this constitu- during this period, and we would use receive $15,000 a year for the next 10 tional amendment. We will pass a bet- the Social Security surpluses for real years. They are very happy about that. investments in America, in our eco- ter, a stronger, a significantly more But the uncle has imposed a require- conservative amendment if we will but nomic growth, in making our country ment on them. He loves the Jones’ two stronger so that it would be in a posi- take a series of actions in the next few children. They are his favorite nephew hours. tion after the year 2018 to meet this and niece, and he wants to see that enormous indebtedness. they go to college. So he is going to re- It would be my hope that we would In fact, we have not been doing that. quire as a condition of receiving this take as preferred action, No. 1, the pas- We have been using the Social Security $15,000 over each of the next 10 years sage of the amendment that the Sen- surplus to fund our annual deficits. that the Jones family commit that ator from California, Senator FEIN- This amendment will allow Members to they will send these two children to STEIN, has offered which takes Social continue to use our Social Security college. Security out of the rest of the Federal

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00044 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3183 budget. It would deal with the prin- The Congress shall enforce and implement amendment that will protect what has cipal issues raised particularly in sec- this article by appropriate legislation which been one of the great social programs tion 1 and in section 7 that I discussed may rely on estimates of outlays and ex- in this Nation’s history, a program earlier. penditures. that has lifted the America’s seniors If we fail to pass the Feinstein I think that there is an obligation out of poverty, given them a level of amendment, we ought to adopt the owed by us to the American people to respect and dignity in their retirement first of my two amendments which tell them how we are going to do that. years. We should protect the Social Se- says: If we are going to have a three- I believe that the outcome of the bal- curity system, a system that now fifths vote to raise the limit of debt ance budget amendment has been mis- stands in the gun sight of this amend- held by the public, let us make it a represented. We should outline the im- ment. three-fifths vote on all national debt. plementing legislation. I believe that All of those things are within our The Social Security funds should not the advocates of this legislation ought power to do and to do beginning 23 be more exposed than the other sources to present to us between now and ap- hours and 5 minutes from now. The from which the Congress can borrow proximately 23 hours from now that question is, will we? Thank you, Mr. money. language. Certainly, the bill’s advo- President. Let us all play on a level playing cates have drafted this language. The Mr. DOMENICI addressed the Chair. field. Let us have a three-fifths vote for objectives and strengths of this legisla- The PRESIDING OFFICER (Mr. lifting our public debt limit. Let us do tion are being regularly commented THOMPSON). The Senator from New what the reporter in the Washington upon. Making public that language Mexico. Post, and what two of our colleagues might help to alleviate some of the Mr. DOMENICI. I thank the Chair. apparently think we are doing in this concerns that myself and others have I might say to my friend from Flor- amendment, by requiring a three-fifths raised during this debate. ida, I only have about 15 minutes, and vote to raise the ceiling on borrowing. I think we have a right to see what if the Senator does not mind, with ref- We are not doing that in this amend- the implementing language will actu- erence to the questions the Senator has ment. We should. ally say so that we can assess whether posed to me regarding the Social Secu- Finally, and I particularly would like we think it will protect the Social Se- rity trust fund, I will come back to the to direct this comment to the chair- curity System, and other important floor on another occasion before the man of the Budget Committee who areas that have been stated. vote if I am granted time and I will ex- probably understands these issues as Or finally, and this, again, goes to plain my version of what the Senator well as anybody in this Chamber. If we the chairman of the Budget Com- has just described. continue with the outline of fiscal pol- mittee, if we pass this amendment Frankly, I think the issue is one of a icy found in this amendment, using the without either the modifications that unified budget and whether we should Social Security surpluses as an addi- address the serious problems of inte- abandon the unified budget or not. I tional area of borrowing, with only a grating Social Security into the rest of am a staunch proponent of the unified majority vote required, we will be the Federal budget, and without the budget which has everything on board masking the extent of our other spend- ability to analyze the implementing for economic purposes and for deficit ing or tax cuts. As a result, in 2018 we legislation, then I think the Budget purposes. I believe I can explain to the will carry an $8 trillion debt, about $3 Committee needs to lead our col- Senator that the changes the Senator trillion of which is held by the Social leagues by pledging that we are not is talking about would be accomplished Security System. going to succumb to the temptation to by majority vote, not by supermajority In 2019, we begin this dramatic draw- borrow an additional $2 trillion be- vote, because of the residuals we are down of the Social Security fund. The tween the year 2002 and 2018. Instead, talking about, and the residuals come surplus will drop from $3 trillion to the Senate will produce a budget plan about by passing laws that change zero by the year 2028. How are we going that, in fact, will get us in balance, things, and those laws are passed by to fill this triangle on this chart? The without having to use the Social Secu- simple majorities. But I will go into triangle represents the national debt rity surplus. That we will, rather than that in more detail with the Senator at that we have accumulated by bor- adding to the national debt, be adding another time. rowing from Social Security, but which to the Nation’s savings account. I came today, Mr. President, because now we are going to have to start re- I think that a commitment by the over the weekend there was a lot of paying to the beneficiary. How are we leadership of the Senate and the Budg- talk about what I choose to call what going to fill that void? et Committee that they would take ifs. There were some what ifs that Sen- Under the balanced budget amend- that course of action would be of con- ator MOYNIHAN used on ‘‘Meet the ment, a three-fifths vote would be re- siderable relief to the American people, Press.’’ There is a what if this morning quired to borrow from the public. This it would certainly be of considerable by a columnist named Richard Kogan, amendment will worsen this gigantic relief to this Senator. who used to be a staffer on the House truck crash by saying that over a 10- So, Mr. President, in closing, the Budget Committee. And I would like to year period, we have to borrow $3 tril- American people are poised for a dis- talk about this a bit because this con- lion additional from the public and do appointment. It is not the first time. stitutional amendment will not leave it, we must have a three-fifths vote. At This Congress, over many years, has us without some what ifs. I think there an absolute minimum, I think at least stated that its intention was to act will be some. we ought to adopt my second amend- with fiscal responsibility. You could I propose that the what ifs we are ment. The second Graham amendment list the amendments, bills, the pro- going to have to address are less dan- which says that, when the Social Secu- posals that have had that as their ob- gerous to America’s future than if we rity program moves into a deficit posi- jective. In every one of those instances, do nothing and leave the budget proc- tion, we should be able to refinance the the American people have been dis- ess and leave the Constitution alone program by a simple majority vote. If appointed. They have felt that they and continue the profligate spending we were able to borrow from Social Se- have been misled. That has contributed that we have. curity at a majority vote, why should to the fact that the public standing of I was lucky over the weekend to go we not be able to pay off the bene- this institution has reached almost his- for 4 hours to the city of Detroit and ficiaries with a majority vote? toric lows. then moved next door to Oakland In addition, I would like to comment It is in our hands to do otherwise. It County to conduct a hearing with my on the issue of judicial review. As the is in our hands to pass a balanced budg- distinguished friend, the new Senator advocates have stated on this issue, as et amendment which will live up to our from Michigan [Mr. ABRAHAM], and a well as others, how much judicial in- rhetoric. It is in our hands to pass a very large crowd of participants, in- terference there would be in enforcing balanced budget amendment which will cluding their Governor. this amendment? All of these matters provide a strong deterrent to further It is interesting, Mr. President, that can be handled pursuant to the lan- additions to the national debt. It is in on that day on the front page of the guage in section 2 which states: our hands to pass a balanced budget Detroit paper was a good picture of

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00045 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3184 CONGRESSIONAL RECORD — SENATE February 27, 1995 money, and it was 43 million dollars’ hope it is in place within the next cou- will vote on it, just like we do every- worth of money. It was, ‘‘What Does $43 ple of years—we will have to draw the thing else. And who knows, we may Million Look Like?’’ It indicated that laws with reference to security of even do the next one by a simple ma- the night before last they were drawing banks, security of savings and loans, jority for we might cut something and their lottery, which they call a lotto, recessions and, yes, even unemploy- say cut this and pay for something that and somebody might win $43 million. ment compensation so as to comply is more important. We do not choose to I would like the American people to with this law. We will have to choose do that very often even in crisis in our know that it is interesting that it took some priorities. We may in fact have to great country and in our great Senate that much space to show $43 million, set up better reserves in some of these and House. We choose to say we have and yet in 1 day the deficit of the funds so that at the end of the year we to spend some more because there is a United States is increased by about do not have to push ourselves out of crisis upon us. $500 million, which is about 12 times balance in order to meet these kinds of There are stabilizers in our economy that $43 million. I left a dollar with requirements. now. Where I now see this new diagram Senator ABRAHAM and said buy me one So for those who want to continue of how our economy has been up and of those lottery tickets and make the with a whole laundry list of what ifs, I down since the turn of the century, in- U.S. Government the beneficiary, and would just suggest what if we do not do cluding the Great Depression, and it if we win we will get $43 million. It anything about this deficit. That is the used to be that our economy went in turns out there were three winners so biggest what if. broad sweeps like this and now in the we would only have gotten $15 million. Some would say just go ahead and last few years we are just in narrow But essentially, if we would have won cut the deficit, cut programs. Some of sweeps like this because we have a lot the $43 million and put it against the us have been trying for a long time. of stabilizers in it. The biggest one is deficit, which exists even though Presidents have been around, four, five, the Federal Reserve Board. It now con- Americans are working and paying or six, and we have only had one bal- trols things so we do not have those big taxes to try to pay our current ex- anced budget or two in that whole pe- ups and downs. I do not think we are penses, it would have taken care of 2 riod of time. ever going to have them again. Is it hours of the accumulated deficit of the What we need is the American people suggested that the stabilizers in our United States for the year—2 hours, $43 speaking throughout our country in a Government—unemployment com- million. loud and clear voice that says enough pensation, the Federal Reserve Board Now, frankly, that is what brings me is enough. And what if we do not put putting more money on the market or to the floor and that is what brings me this in the Constitution and force our- making less available, reducing short- in support of an effort on our part to selves, and, yes, force the American term interest rates if they can, in cri- produce within our Constitution a people to accept less from their Gov- ses, extending unemployment when we mandate that we stop this kind of prof- ernment rather than more? need to, making sure that banks really ligate spending which is going to cause Now, in trying to get the deficit bet- cannot go totally broke from the America to have little economic future ter under control, when we have our standpoint of diminishing our currency 15 or 20 years from now when my good great constituents, our friends from value—we have all those things in friend from Florida is worried about our home States, coming before us say- place. Are we going to wipe all those how we are going to pay the Social Se- ing, ‘‘Not my program, somebody out just because we are insisting that curity recipients, and I am worried else’s,’’ let me say in my State I pledge it is enough to spend $1.6 trillion and about that. But I am also worried only fairness, that my State in this re- perhaps we should not spend $1.7 tril- about what is going to remain for any- straint and this restructuring of Gov- lion? Should we not be prudent enough body else, including my grandchildren ernment will be treated fairly. But I to keep the stabilizers in? and their children, who are going to cannot say that every single program So I believe those arguments are have to work—in one case it is sug- and every single entitlement that we truly, truly red herrings. For those gested that to pay this bill, if we do currently spend, that we currently who think we ought to control the not get the costs under control, the have programmed in where they will American economy by turning spend- marginal tax rates would have to be 82 increase every year—in the case of ing on and off, the Keynesian idea of percent. Medicare and Medicaid at 10.5 or 11 per- economics, frankly they will remain Now, who is going to work in Amer- cent ad infinitum—I will not have to people who think that is what we ought ica and what kind of future do you say who is going to pay for that. And if to do. And there will remain those who have if that is the case? we have to get the deficit under con- do not think we ought to do that. And, So there are a lot of what ifs, and one trol, what are we going to change if we frankly, I am confident that we are of the what ifs is what would we do if do not change yours? going to find our way within the imple- our banking system or our savings and So the bigger what if is not what if menting language for this amendment loan system suffered a very big loss we have a bank failure or what if we to do what we must to be prudent and and we had to come up with the money have a recession or what if we have rational with reference to a strong to bail it out. more unemployment. American economy. Well, Mr. President, let me suggest I would remind the Senate, if you are I would like to make two other there is nothing in this constitutional wondering whether the Senate can points. First, all of the changes re- amendment which says you must have work its will even against difficult vot- quired to reach results within the a three-fifths vote to conduct the busi- ing requirements for something like framework of this constitutional ness of the U.S. Government, whatever unemployment, I would like to put in amendment require simple majorities. that business is. the RECORD the unemployment com- It was thought at one point the Con- What it does say is if you want to do pensation extension which occurred, stitution may have in it three-fifths it in a way that is unbalancing the believe it or not, when the rule of law vote on taxes. That is not in the Con- budget and you must borrow more in the Senate said you cannot spend stitution, in this amendment. So what- money to do it, you need three-fifths. any more money because you would ever you want to change to make the So it is a matter of priorities and violate the pay-as-you-go requirement, deficit go up or down, tax more, cut choices. And for those who think we much like we are going to have with more, create less of an entitlement or a will not have the wherewithal to pre- this constitutional amendment, and bigger entitlement—those are all done vent the big recessions from occurring somebody said we have to pay for un- by simple majority. It is the residual of and harming us more if we have this employment, we still need 6 or 8 the simple majority votes that end up amendment than if we did not, might I months of extended benefits. What do with the deficit being too big or too lit- suggest that we can be accused of a lot we do? What do we do? Eighty-eight tle. of things but we cannot be accused of Senators voted to do it; 88 Senators My final point is it is amazing to this being totally ignorant and stupid. We voted to do that because it was needed. Senator that there is now an argument will have to draw our laws after we Now, that is the what if. If we have that we should not have a three-fifths have this amendment in place—and I not planned to take care of that, we vote to borrow more money and break

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00046 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3185 the concept of a balanced budget at a culations are already in the unified amendment and will vote against it point in time. There is an argument we budget concept by definition. when the final vote is taken in the Sen- should not have three-fifths. I will go into that in more detail to- ate tomorrow. My friends and fellow Americans, you morrow because I believe that is the The proposed amendment is appeal- must be bound by something. The sim- case. I do not believe the argument ing on the surface, but underneath ple majority got us where we are, vot- that you can borrow all you want from there are a host of problems. I believe ing for everything and refusing to cut; Social Security because you are only its objectives are unrealistic and pos- voting for taxes, and then not voting to governed under this amendment when sibly detrimental, and I fear that it cut spending. Those are all a result of increasing the publicly held debt; I do could place intolerable burdens on the simple majority votes. not think that is a valid argument. I States. Should we have a constitutional think they are one and the same when I find myself in basic disagreement amendment—what a joke—that says it comes to the unified budget. It is no with the philosophy of the proposed you must be in balance unless a simple easier to do one or the other under the amendment. As our distinguished col- majority says you do not have to be? unified budget and I will try to do a league from New York, Mr. MOYNIHAN, Why go through the trouble of passing better job on that tomorrow. has so eloquently reminded us, the it? That is the rule today. That is what So, in conclusion, this Senator has Federal budget is not supposed to be in Senator Harry Byrd from Virginia did been through many, many ‘‘what ifs?’’ perpetual balance. Those of us who ex- 18 years ago in the U.S. Senate. He Many times we have said what if we perienced the economic cycles pre- passed a substantive law of the land would have done this, we would be in ceding World War II have a special re- that said you shall no longer have any better shape than we are. What if the spect for the wisdom of John Maynard deficits, starting 1 year from now. 1986 budget that Senator DOLE and I Keynes, who showed us that govern- That stayed on the books while we put through the Senate had been ac- ment should save when times are good incurred deficits, because when Con- complished, where would we be? We so that it can spend when times are gress votes the last vote, the last law would be very far along in terms of the bad. governs. So if we had a constitutional deficit, ridding ourselves of it. But it The balanced budget amendment is amendment that did not have some did not happen. So the what ifs on the the antithesis of that sensible doctrine. kind of supermajority, where would it side of the equation that says what if Its ritualistic requirement for balance stand on a roster of enforceability, of we do not do this, put this constitu- in each fiscal year disregards the ran- something with teeth? It would have tional amendment in place, far out- dom vagaries of economic cycles, pre- zero teeth. weigh the other what ifs about how we cluding the timely operation of auto- So, for those who do not like the will solve some other smaller problem matic stabilizers such as unemploy- three-fifths, they must be saying one of within the huge, huge notion of bor- ment insurance and bank deposit insur- two things. We will really solve the rowing to pay for our current debts and ance during downsizings when they are budget with simple majority votes, al- interest that we have incurred. most needed. though we have been unable to do it I will close today by suggesting to Likewise, the ritual requirement to heretofore; it will be done. Or they the senior citizens of the United achieve balance might deter the accu- mulation of budget surpluses in good must be saying it should be stronger States, if I were advising what policy years, since the pending amendment than three-fifths. I thought that was an should be adopted I would say whatever might tend to promote unreasoning tax argument I might hear. I thought I policy the Congress of the United slashes, instead of the prudent salting might hear an argument that there States and the President are going to away of a surplus. should be no way to avoid a balanced be firmly committed to that is most I also fear that the rapid withdrawal budget—three-fifths, six-fifths, who apt to have sustained economic growth of some $1.6 trillion in Federal spend- cares? You cannot do it. over a 20- or 25-year period of time. ing in the arbitrary time frame of the This amendment is pretty well Whatever that policy is, with reference next 7 years could virtually wreck the thought out. Because most things will to fiscal policy, we better support it. I economy, especially if it should coin- get done by simple majorities around will guarantee that for all that is being cide with a period of high interest rates here, which is the good way to do it, said on the floor about the future of or a recession. And I am particularly the democratic way, the majoritarian the Social Security trust fund and how concerned about the impact of a cumu- vote idea is a paramount idea in Amer- much have we borrowed and how much lative loss of $1.8 billion in Federal ican democracy. However, we are mere- have we not borrowed and what are we spending to the small State of Rhode ly suggesting that the debt is getting going to do 12 years from now and 20 Island over the same timeframe. too big. The annual deficits seem never years from now, I will say to every sen- Finally, Mr. President, I recoil at the to be controllable. So when it comes to ior in America there is little chance notion of using our Constitution for borrowing money to pay for this def- that what is expected of Social Secu- the purpose of imposing bookkeeping icit, increasing the debt, that you have rity will ever occur in a 20- or 25-year rules. I doubt that this amendment will to have a supermajority. I think it is timeframe, unless you can extract from stand the test of timelessness which the only way we are going to get there. your legislators and policymakers that has sustained the wisdom of the Fram- In fact, I will confess when they were they have done the very best they can ers for 200 years. looking for ways to enforce a constitu- to create an environment for sustained From the perspective of the year tional amendment, and if you look economic growth. Without it Social Se- 2095, it may appear rather anomalous back in history we have had a number curity is doomed, the pensions of the that the U.S. Senate spent the month of them, they have been enforceable by future are doomed, and the trust fund of February 1995 trying to mandate for different mechanisms, I concurred is not going to mean much. all time that our books should be bal- wholeheartedly as budget chairman I believe a balanced budget approach anced, down to the last dollar and cent, that this was probably the best way— like this is a start down the road of the at the end of each 12-month period. My put a limitation on the public debt. best fiscal policy we can have, com- guess is that—if the amendment is ap- I believe when we are finished argu- paring what we have been able to do proved—a disenchanted electorate will ing tomorrow about the unified budget and what we have promoted and have repealed it long before the cen- and Social Security—and I hope to propped up and levied against the peo- tury passes. bring that to the floor and talk about ple of this country over the past 20 to Of course, we can and should con- it—that essentially everyone will un- 25 years. tinue to do everything we can to cut derstand that the unified budget gov- I yield the floor. Government spending and reduce defi- erns everything in it and that essen- The PRESIDING OFFICER. The Sen- cits. But we already have ample au- tially if you want to change things you ator from Rhode Island. thority to do so and should simply get change them by simple majority and AGAINST THE AMENDMENT on with the task. you are not going to borrow any more Mr. PELL. Mr. President, after much In my mind, there is no need for a or any less, based upon the Social Se- deliberation, I have concluded that I constitutional amendment. The Con- curity trust fund, because those cal- should not support the balanced budget stitution should not contain a balanced

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00047 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3186 CONGRESSIONAL RECORD — SENATE February 27, 1995 budget amendment, and I would trust Mr. President, I call this—and I unfunded mandate. This is not even a that it does not succeed. I realize the think I can call it this in all truth and mandate. This is something merely de- political appeal of the very title of a honesty—a States’ rights amendment. claring the intent of the Congress, that balanced budget amendment is im- This is an amendment that would be- the States would have the opportunity mense. It is not an open and shut case long to the people as their right to tell to show us where these cuts and where one way or the other. Many of us have the Congress how the cuts should be this pain could be best allocated. We proposed different ways at different made in our respective States. think it is fair; we think it is simple. It times. I voted for it in the past. But it Back in the middle part of January speaks to the issue in one simple sen- is a close call. But my conclusion is the Department of Treasury came out tence that we hope will be accepted by that the best interests of the Nation with what I consider to be a very thor- this body tomorrow. would be served by not passing the bal- ough study of how each State would be Some might say, if we accept this anced budget amendment. impacted and affected by a constitu- amendment, even though it is just one The judgment against this proposal tional amendment to balance the budg- sentence, then we are going to have to was best summed up by the columnist et by the year 2002. go back and have a conference with the David Broder when he wrote that it is Mr. President, I hold this study in House of Representatives to reconcile ‘‘a bad idea whose time has gone.’’ The my hand. And from time to time, I any differences. We would do this be- time and place to stop it is here and have been given the opportunity to dis- cause we have dared to differ with the now. I urge its rejection. cuss with my colleagues in the Senate House just by adding this one sentence. I yield the floor. how each of our States represented by Mr. President, I do not really buy that Mr. PRYOR addressed the Chair. this body would be affected by this par- argument, because it is very rare in- The PRESIDING OFFICER. The Sen- ticular amendment that will be voted deed that we approach the eve of a his- ator from Arkansas. on sometime during the course of the toric vote on an amendment such as Mr. PRYOR. Mr. President, I thank legislative day tomorrow. this, which will change forever the the Chair for recognizing me. For example, the Treasury Depart- basic relationships of the three Mr. President, before I make a few ment has indicated that the State of branches of Government. We would be short remarks, I would like, if I might, Arkansas from which I come, a small forever changing the way Government to compliment the distinguished Sen- State of around 2.5 million people, deals with how we finance, how we ator from Rhode Island. He and I have would have to increase State taxes— structure the American economic sys- talked about this issue of the balanced not Federal taxes, State taxes—by 16.5 tem. budget on several occasions. I have percent across the board to make up This is a crucial, critical vote tomor- been in what you might call sort of for the loss of grants, should the bal- row. In the 1 or 2 days’ time that might soul-searching meetings with the Sen- anced budget amendment pass, and the be expended in a conference between ator from Rhode Island. I have watched Federal budget is balanced by the year House and Senate conferees—con- him—I do not want to say in his 2002. ferences are done all the time; it is nor- agony—in attempting to reach a deci- Also, Mr. President, we would see a mal and it is natural to have con- sion about his vote. But I certainly cut in about $1.1 billion a year in Medi- ferences on differences between the two have seen him trying to search for the care benefits to our State, and another bodies—I feel they can work out. If not proper role to take and the proper an- $1.1 billion per year in other programs this language, at least the spirit of this swer to give to his constituents and where the Government allocates the language to be encompassed in the ours with regard to this all-important money to the States. final draft of the amendment, so as to vote that we will take tomorrow. There are going to be severe cuts to give the people of America the oppor- Mr. President, please allow me to each State. My amendment basically tunity to speak to the Congress, to say compliment my very distinguished would say that the people of the where these cuts should occur. friend from Rhode Island, not only on State—through or via their own State Mr. President, once again, the people his decision, but on the very thought- legislatures sitting at the proper time, of the State would speak during the ful way in which that decision was during the debate on whether or not to ratification process. This is presup- reached. ratify this amendment by the respec- posing—maybe wrongfully, I do not Mr. PELL. I thank my friend, the tive States, would tell their State leg- know—that there will be 67 votes to- Senator from Arkansas. islators sitting in their respective gen- morrow to ratify this amendment to AMENDMENT NO. 307 eral assemblies how the people feel balance the budget. But, Mr. President, Mr. PRYOR. Mr. President, on Friday these allocations should be effectuated in my opinion, it is very, very impor- I talked briefly about an amendment in the State. tant because we have now lost the fight that I am going to call up for a vote to- The State legislatures would be look- on the people’s right to know how Con- morrow. The number of this amend- ing at the allocation of cuts based upon gress will balance the Federal budget, ment, for the purposes of our staff who the total Federal funds received today. and at least we will have some safe- might be watching the monitor at this That would be the basis of the formula guard, some measure of the impact on time, is amendment number 307. that the States would be employing in the States, should this amendment re- Mr. President, this amendment is recommending to the Federal Govern- ceive 67 votes. And before the States very simple. In fact, it is only one sen- ment, the Federal Congress, the na- ratify or fail to ratify this amendment, tence long. I am going to take the lib- tional Congress, how these Federal we would have the opportunity for the erty of reading amendment 307 that we funds, these cuts, should be imple- people to express to us how they feel as will consider tomorrow, and I will do mented out in the States. to the allocation of this pain that we that at this time. On page 3 of the con- This would give the people of our will feel. Mr. President, I will conclude by say- stitutional amendment, between lines 8 country a very, very rare opportunity. ing that this is, as we have all known and 9, the following sentence would be It would provide our people the oppor- for a long time, going to be a very close inserted: tunity to tell Congress where these cuts should be made. It would provide vote. We are seeing many phone calls It is the intent of Congress that each State come into our offices, and letters and should, as a part of the ratification process, the people of America the right basi- submit to Congress recommendations for re- cally to petition Congress, in an infor- telegrams; there is no question about ductions in direct and indirect Federal funds mal, nonbinding way, say as what we that. That should be encouraged be- provided to the State and its residents (based believe out in the country, the prior- cause the people should express how on the State’s allocation of Federal funds) ities should be in allocating cuts in they feel about altering the Constitu- necessary to balance the State’s share of the Federal spending back to the States. tion of the United States in this way. Federal deficit. Mr. President, we have just gone But I am just very hopeful that all of That new sentence I would attempt through a very, very lengthy several the people in the country who are to add by amendment 307 to the pro- days of session in the Senate with re- watching this particular debate on this posed constitutional amendment before gard to the issue of unfunded man- issue of the balanced budget amend- us at this time. dates. Let me say that this is not an ment, I am just hoping, Mr. President,

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00048 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3187 they will realize that most of us in this a great deliberative body and that we every 12 years. We amended the con- body want and desire and are com- have carried out our mission, I hope, stitution only four times during the mitted to a balanced budget. Some of with sincerity and a commitment to entire 19th century—that is three fewer us do not feel at this time that the the cause that we are attempting to amendments than the new majority proper way to achieve that balanced serve. leadership wants to adopt in the next 2 budget is to put it in the Federal Con- Mr. President, I see my very good years alone. stitution. friend from Connecticut, and he is not It is certainly not unusual for the I, for one, do not feel that we should ready to speak just now. Therefore, I winning party in an election in this wait until the year 2002 to begin trying will suggest the absence of a quorum. country to seek adoption of its legisla- to balance the budget. I think that we The PRESIDING OFFICER. The tive agenda. That is democracy and have to begin that process now, as we clerk will call the roll. that is as it should be. What is unusual, did in 1990, as we did in 1993. We have The assistant legislative clerk pro- Mr. President, about the new leader- to continue on that cycle in order to ceeded to call the roll. ship’s plans is the desire to enact its find ourselves, to place ourselves on Mr. DODD. Mr. President, I ask unan- agenda not by statute but into the per- the glidepath to a balanced budget. I imous consent that the order for the manent Constitution of this Nation, think, too, that many people who quorum call be rescinded. the organic law of our country. might be watching this argument must The PRESIDING OFFICER. Without These proposals are even more sur- realize that we cannot in this country objection, it is so ordered. prising, I might add, coming from some violate a 60-year-old contract that we Mr. DODD. Mr. President, I rise who are self-styled conservatives who have had and have maintained with the again today to discuss the balanced profess to believe in cautious, rea- people of this country relative to their budget amendment and to provide what soned, and judicious change. Social Security trust funds, which I hope will be some constitutional his- The Constitution is not a set of fra- some fear will be used to balance the torical perspective on this issue. ternity bylaws to be amended with budget. Let me begin by commending my col- each new pledge class. It should reflect Mr. President, we know that in this leagues for the fact that we have had not the popular winds of the time, but amendment, we have voted down the an opportunity now over the past sev- the sacred principles of all time. As a country, we have never sup- amendment which would have exempt- eral weeks to thoroughly debate and ported governing by means of constitu- ed Social Security funds from the bal- discuss this issue. As my colleague tional amendment. Since the adoption anced budget amendment. I say, and from Arkansas just noted, I think the of the U.S. Constitution, 10,831 con- say without reservation, that this was institution has been well served by this stitutional amendments have been pro- one of the more critical votes that we debate. It is exactly what the framers posed in the U.S. Congress, but only 17 dissected and explored with regard to intended; that, on matters of deep and of those amendments have ever been this constitutional amendment. profound concern to the Republic, this ratified, if you exclude the Bill of Finally, Mr. President, I think there body act in a deliberate fashion. And Rights. That is fewer than one-quarter is another issue that hangs out there there can be no matter more serious of 1 percent of all amendments ever and haunts us and, in fact, taints this than an effort to amend the Constitu- tion of the United States. And cer- proposed. constitutional amendment as proposed. Why do I mention that? The proce- tainly, when we attempt to do so, a This is the issue of the judiciary’s role dural hurdles to ratification of con- thorough and complete debate and dis- in interpreting what we did, and also, stitutional amendments are very, very cussion of the implications of that de- the role that the Federal judges might hard for a very, very good reason. An cision ought to be the business of this well play in implementing the con- amendment that may look perfectly body for however long it takes. stitutional amendment to balance the reasonable today may prove to be un- I particularly want to commend the budget, and their having the ability to necessary or even dangerous, not to efforts of my colleague from West Vir- raise taxes to balance the Federal mention silly, down the road. budget. ginia, Senator BYRD, who is, I believe A few examples from history I think Mr. President, I am not talking all recognize in this body, regardless of will make this point. about the U.S. Supreme Court having party, truly one of the great histo- In 1808, one of my predecessors from that ability. I am talking about Fed- rians, one of the great minds when it Connecticut, Senator Hillhouse, pro- eral district judges perhaps having the comes to the Constitution, and to the posed to limit the President’s annual opportunity, or seizing the oppor- rules of the Senate. I suspect that all salary to $15,000 a year by writing it tunity, to come forward and say that of our colleagues have benefited di- into the Constitution of the United the Congress has not balanced the rectly from his historical perspective States. Now, I am hesitant about citing budget; therefore I, acting under the and his leadership on making Members that example because it may enjoy authority vested in me as a Federal aware of the implications of a constitu- some popular support today, given the district judge in Nashville, TN, or Lit- tional amendment of this significance. reactions the people have to people tle Rock, AR, or Oshkosh, WI, or wher- Mr. President, the congressional serving in public life. But Senator ever the case may have arisen, to en- leadership of the new majority is now Hillhouse figured that surely this was a join the issue of taxation. advocating the most sweeping rewrite generous offer at the time. Under the constitutional amend- of the U.S. Constitution in two cen- In 1838, the Nation was scandalized ment, we are going to see taxation turies. In addition to the matter before when one Member of Congress killed without representation, Mr. Presi- us—the balanced budget amendment— one of his colleagues during a duel. dent—that is my firm belief—in the many in the new leadership are advo- This led to the introduction of a con- event that we pass the Federal bal- cating amendments on tax limitation, stitutional amendment to bar individ- anced budget constitutional amend- term limits, line-item veto, unfunded uals implicated in dueling from ever ment on tomorrow. mandates, school prayer, and flag burn- holding elective office by changing the Tomorrow is a critical vote, and I ing. Mr. President, that is seven con- Constitution. just hope that the people of our coun- stitutional amendments that the new In the latter half of the 19th century, try will realize that this has not been a Republican leadership hopes to pass in a great concern over the abuse of pa- delaying tactic, that we have wanted this Congress. tronage led to repeated amendments to fully explore the momentous deci- Other than the Bill of Rights, com- mandating the popular election of post- sion that we have to make on tomor- posed of 10 amendments, all ratified in masters and deputy postmasters in the row. 1791, making so many changes to the country. Imagine what that would do Mr. President, I respectfully submit Constitution so fast would be utterly to the political process today? that on both sides of the aisle, we have and totally unprecedented. In the opening decades of the 20th conducted this debate in a manner Throughout our history, we have century, there was increasing alarm where I hope the people—whether they changed the Constitution only occa- over the number of divorces in the agree or disagree with our decision— sionally. Since 1791, we have amended country that led Senator Ransdell of will at least say that the U.S. Senate is the document an average of only once Louisiana to offer a constitutional

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00049 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3188 CONGRESSIONAL RECORD — SENATE February 27, 1995 amendment to prohibit divorce in the are readily explainable. The War of Constitution to require balanced budg- United States. 1812, the panic of 1837, and the depres- ets we elevate one goal above other In 1919, a growing concern over the sion that followed—I have already equally important objectives. We fun- evils of drinking led to the 18th amend- mentioned the Civil War, the bottom damentally change our ability to re- ment, prohibiting the sale or manufac- line here—World War I, over here, and spond to complex and changing cir- ture of alcoholic beverages in the World War II, as well, where deficits cumstances. United States. The amendment, as were incurred. It is a law of physics, Mr. President, most will recall, was a failure—prohibi- Without the so-called discipline of a and of life, that every action has a re- tion was widely flouted. Congress’s balanced budget amendment, we were action. Some we can anticipate, others only choice was the unseemly one of able to get out of those difficult deficit we cannot. One reaction we can expect adopting yet a new constitutional cycles. is that balancing our budget in eco- amendment to repeal the previous one. One huge deficit swing that is not re- nomic recessions will destabilize our My point, Mr. President, in men- ported on this chart is President economy and increase the volatility of tioning these amendments is not to Thomas Jefferson’s 1803 decision to the financial markets. ridicule those who offered them nor to make the Louisiana Purchase. Laura Tyson, the President’s Chief question their motives at the time. In Jefferson borrowed $15 million, an Economic Adviser, recently noted that fact, many of these proposals were un- amount $4 million greater than the en- had a balanced budget requirement doubtedly reasonable, or at least tire Federal budget for that year, to been in effect during the last recession, thought to be so, at the time they were acquire the new territory. it would have thrown 800,000 people in suggested. But, Mr. President, as I re- Based on a letter he wrote, a number this country out of work. Historically, cite them, I think all would agree that of my colleagues have cited Jefferson deficit spending has functioned as an they would not have stood the test of as a supporter of a balanced budget important fiscal tool to stabilize the time. amendment. economy and moderate fluctuations in Over time, I believe that a balanced I think my colleague from Texas, the business cycle. budget amendment will fare no better. Senator GRAMM, is one who made spe- When the economy is in recession, I would like to take a few moments, cific reference to it. I point out that the Federal Government takes in less if I could, and add a little historical Thomas Jefferson would have found it money. That is stating the obvious. A perspective to our debate on balanced a good bit more difficult to make this balanced budget requirement would budgets. purchase if a vote on waiving the Con- compel Congress to match declining Much has been said in the last few stitution to permit an unbalanced revenues with increased taxes or spend- days and weeks about our current Fed- budget had been required in 1805. Today ing cuts. In the process, Mr. President, eral deficit and debt problems. I would our colleague from Texas might be run- it would force the Congress to renege concur with my colleagues about the ning for the Presidency of Texas rather on promises to provide a critical safety importance of reducing our debt. It is than the Presidency of the United net to our citizens just when it is need- clearly a drag on our economy and a States. ed the most, and it would impede our burden on all Americans. The Louisiana Purchase does not ability to hasten recovery by providing I, however, strongly differ, Mr. Presi- show up on the chart because of an ac- a fiscal stimulus when it, too, was dent, with my colleagues in their inter- counting distinction. The appropria- needed most. pretation of our current deficit prob- tion is not shown here because our Changing the Constitution is not like lems as a recent development in our chart excludes receipts from bor- adopting a simple statute that can be Nation’s history. rowing. If borrowing had been included, modified or appealed in that Congress This chart to my left, Mr. President, the Louisiana Purchase would be twice or succeeding Congresses. Constitu- lays out the historical perspective, be- as deep as the largest dip in the chart tional amendments must be held to the ginning in 1794 and moving up to 1994 of caused by the Civil War. highest possible standard. Indeed, the surpluses and deficits as a percentage Jefferson knew that the Constitution language we insert into the Constitu- of our spending. did not explicitly grant authority to tion will very likely stay there as long This chart reveals that there have purchase new land, and that concerned as this Republic stands. Generation been wide variations in spending pat- him. He considered a constitutional after generation will live with the con- terns throughout our history. We have amendment to permit such authority. sequences of our constitutional deci- had surpluses as high as 102 percent of But he realized, Mr. President, that the sions. Federal spending in 1835—in this area— opportunity to buy the new land could Henry Clay said, 140 years ago: and deficits as great as 89 percent of be lost through a lengthy ratifying The Constitution of the United States was Federal spending in 1862 during the process. So despite his constitutional made not merely for the generation that Civil War—this bottom line down here. reservations, he sought congressional then existed, but for posterity—unlimited, The chart also illustrates that our approval to add both vast new territory undefined, endless, perpetual prosperity. current difficulties are small relative and a staggering public debt to our The key to the Constitution’s ability to deficits that our Nation has experi- young Nation. to endure is its simplicity, Mr. Presi- enced in the past. When we compare Mr. President, the historical perspec- dent. That is why making the Con- the high-water marks of past deficit tive reinforces, I think, a very impor- stitution too long and too specific runs spending with the worst of the Reagan tant point. Balanced budgets have not the risk of damaging the entire docu- era deficits, we find that the depth of been a natural part of our national ex- ment. The Framers understood that our current deficit cycle is much perience. Nor should we expect them to danger when they wrote the Constitu- smaller. be. tion two centuries ago. That is the period from here, begin- Clearly, balanced budgets are desir- Edmund Randolph of Virginia was ning at about 1959, and going to the able. I do not think there is any debate one of a handful of delegates to the present, these smaller lines back and about that point. But they are not our Constitutional Convention charged forth. only goal. Providing economic and with turning the general principles In 1983, at the height of our current military stability, raising living stand- agreed upon into constitutional lan- deficit problems, the Federal deficit ards, promoting adequate savings and guage. Before getting down to drafting, was 26 percent of overall spending. It is investment, and reacting repeatedly to Randolph briefly spelled out his philos- now about 13 percent of overall spend- unforeseen events, are also critically ophy of Constitution writing: ing. Let me quickly add, there is no important objectives. In the draft of a fundamental constitution, question that these rates are far too It is unrealistic, in my view, to ex- two things deserve attention: (1) To insert high, but they have been far worse— pect any great nation to achieve all of essential principles only, lest the operations of Government should be clogged by ren- and we have recovered. these goals in every given year. In dering those provisions permanent and unal- We have run deficits in half of our America, we elect our representatives terable, which ought to be accommodated to last 200 years. Most of the major bumps to make difficult decisions and to bal- times and events; and (2) to use simple and and squiggles that you see on the chart ance competing needs. If we amend our precise language, and general propositions,

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00050 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3189 according to the example of the several con- promise our economic stability and to It is important to recognize that the Bal- stitutions of the several States; for the con- do great damage to our economy. anced Budget Amendment imposes proce- struction of a constitution necessarily dif- We ought not to look just at this dural constraints on the making of budg- fers from that of law. most recent period and ignore the etary choices. It does not take away the While the U.S. Constitution has en- spending patterns throughout our his- power of the Congress to spend or tax. The dured, many of our State constitutions amendment requires only that the Congress tory. And, we ought not to look at and the Executive spend no more than what have come and gone. As the constitu- most recent experience and deny 205 they collect in taxes. In its simplest terms, tional scholar Martin Landau has years of constitutional history in the such an amendment amounts to little more pointed out, there have been more than process. That would be a grave mis- than ‘‘honesty in budgeting.’’ 200 State constitutional conventions take. Of course, we always pay for what we spend since 1789, as States have had to shelve Mr. President, we have a serious obli- through government, as anywhere else. But detailed Constitutions that became ob- gation to confront our fiscal difficul- those who pay for the government spending solete and overly restrictive. As Lan- ties. We do not have the right to visit that is financed by borrowing are taxpayers dau writes: on the Constitution of the United in future years, those who must pay taxes to State Constitutions, notoriously com- States a highly questionable solution meet the ever-mounting interest obligations plicated, cluttered, and rigid, have come and to a contemporary problem. The an- that are already far too large an item in the gone—tossed away as outmoded, inelastic, swer to our present-day frustrations federal budget. The immorality of the and maladaptive instruments. intergenerational transfer that deficit fi- should not be sought by cluttering up nancing represents cries out the correction. That is a fate, Mr. President, we do the perpetual life of our democracy. To Some opponents of the Balanced Budget not want to visit on our national Con- do so, I believe, would be a decision Amendment argue that the interest burden stitution. We must ensure that it re- that we will live to severely, severely should be measured in terms of percentage of mains a brief, lucid statement of gen- regret. national product, and, so long as this ratio eral principles, not a highly specific I urge my colleagues to reject this does not increase, all is well. This argument legislative vehicle. proposal when the vote occurs tomor- is totally untenable because it ignores the I invite my colleagues to read the en- row. effects of both inflation and real economic tire Constitution with all of its amend- Mr. President, I yield the floor. growth. So long as government debt is de- ments and then immediately read this Mr. DEWINE addressed the Chair. nominated in dollars, sufficiently rapid in- The PRESIDING OFFICER. The Sen- flation can, for a short period, reduce the in- proposed amendment. Like me, I think terest burden substantially, in terms of the you may find this to be a jarring exer- ator from Ohio. Mr. DEWINE. Mr. President, I rise ratio to product. But surely default by way cise, moving from the simple elegance today in very strong support of a bal- of inflation is the worst of all possible ways of our existing Constitution to the ar- of dealing with the fiscal crisis that the def- anced budget amendment to the Con- cane complexity of this proposed addi- icit regime represents. stitution. tion. Opponents also often suggest that Congress I will begin by asking unanimous This balanced budget amendment has and the Executive must maintain the budg- consent that this letter that was re- eight sections and 292 words in it. That etary flexibility to respond to emergency leased today signed by 219 economists is more words, Mr. President, than the needs for expanding rates of spending. This from throughout the country who have first five amendments that establish prospect is fully recognized, and the Bal- endorsed the balanced budget amend- anced Budget Amendment includes a provi- some of our most enduring and funda- ment be printed in the RECORD. sion that allows for approval of debt or defi- mental liberties: The freedom of There being no objection, the letter cits by a three-fifths vote of those elected to speech, the freedom of religion, the was ordered to be printed in the each house of Congress. freedom of assembly, the right to peti- RECORD, as follows: When all is said and done, there is no ra- tion the Government, the right to bear BALANCED BUDGET AMENDMENT—AN OPEN tional argument against the Balanced Budg- arms, freedom from unreasonable LETTER TO CONGRESS, FEBRUARY, 1995 et Amendment. Simple observation of the fiscal record of recent years tells us that the search and seizure, and the right to a It is time to acknowledge that mere stat- procedures through which fiscal choices are jury trial. There are less words in- utes that purport to control federal spending made are not working. The problem is not cluded in those five amendments than or deficits have failed. It is time to adopt one that involves the wrong political leaders is proposed by this amendment. constitutional control through a Balanced or the wrong parties. The problem is one Budget Amendment. In supporting such an Mr. President, our current deficits where those whom we elect are required to amendment, Congress can control its spend- are too high. We all know that. They function under the wrong set of rules, the ing proclivities by setting up control ma- need to be reduced. As a direct result of wrong procedures. It is high time to get our chinery external to its own internal oper- President Clinton’s leadership, we have fiscal house in order. ations, machinery that will not be so easily made significant progress on this prob- neglected and abandoned. We can only imagine the increase in inves- lem. The deficits are declining for 3 Why do we need the Balanced Budget tor and business confidence, both domestic straight years in a row, the first time, Amendment now, when no such constitu- and foreign, that enactment of a Balanced I might add, that that has happened tional provision existed for two centuries? Budget Amendment would produce. Perhaps since the Truman administration. The answer is clear. Up until recent decades, even more importantly, we could all regain For the first time since the 1960’s, the principle that government should bal- confidence in ourselves, as a free people under responsible constitutional govern- the Federal Government is collecting ance its budget in peacetime was, indeed, a part of our effective constitution, even if not ment. more in revenues than it is spending on formally written down. Before the Keynes- Mr. DEWINE. Mr. President, this par- programs. Our most recent deficits are ian-inspired shift in thinking about fiscal not due to overspending on Federal matters, it was universally considered im- ticular letter was solicited by the programs but rather to the payment of moral to incur debts, except in periods of American Legislative Exchange Coun- interest on the debt accumulated dur- emergency (wars or major depressions). We cil and I believe, when read, will indi- ing the 1980’s. According to the Council have lost the moral sense of fiscal responsi- cate the strong support these econo- of Economic Advisers, our budget bility that served to make formal constitu- mists have for the balanced budget would be in balance by 1996 if it were tional constraints unnecessary. We cannot amendment and why they feel it is nec- legislate a change in political morality; we essary. not for required interest payments on can put formal constitutional constraints the debt run up from 1981 to 1992. into place. I agree with the statement of the It is important, though, that we take The effects of the Balanced Budget Amend- Senator from Connecticut that tomor- a broad view of deficit spending and ment would be both real and symbolic. Elect- row will be a very historic day. He and learn from our past history. I refer my ed politicians would be required to make fis- I come down on different sides of this colleagues again to this chart of 200 cal choices within meaningfully-constructed issue. Many of his comments and many years of Federal spending. Throughout boundaries; they would be required to weigh of the comments that have been made our entire history, we have experienced predicted benefits against predicted tax in the last 5 weeks on this floor against costs. They would be forced to behave ‘‘re- great peaks and valleys in Federal sponsibly,’’ as this word is understood by the the balanced budget amendment may spending patterns. Over the last 40 or citizenry, and knowledge of this fact would seem to make some sense. And quite 50 years we have had relative stability. do much to restore the confidence of citizens frankly, I do not believe anyone in this This amendment threatens to com- in governmental processes. Chamber is happy about the fact that

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00051 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3190 CONGRESSIONAL RECORD — SENATE February 27, 1995 at this point in our history, we have serious attempt to balance the budget of both parties, have failed to enact a come to the point where we have to in what people on Capitol Hill refer to responsible Federal budget. Therefore, pass, or at least many of us believe we as the outyears and what people away let us do what is necessary to fix the have to pass, a balanced budget amend- from the beltway refer to as the future. problem. If we do not do it today, it ment. As far, Mr. President, as the eye can may never happen. And future Ameri- Never before have we been this close see with the President’s budget pro- cans will ask why, why, why the Con- to passing a balanced budget amend- posals, we have nothing but red ink. gress, faced with a clear and well in- ment and, quite candidly, I am not sure This budget proposal proves beyond a formed mandate from the American if we do not pass it tomorrow we will shadow of a doubt that America’s fiscal people, chose once again to defend a ever really have a good opportunity to policy is fundamentally misguided. fiscal process that had already created do it again. For the balanced budget Clearly, we need to change course, and a debt of nearly $5 trillion. amendment to pass, the time is now. If if we do not change course, if the bal- Some people would have us believe we cannot pass a balanced budget anced budget amendment is voted that this constitutional amendment is amendment in the current political cli- down, the result will be a bleak future, a quick fix; that it will not solve the mate in this country—after having indeed, for the next generation of real problems of fiscal policy, but when seen what happened in 1992 when every- Americans. I go home to Ohio that is not what I one in this country voted for change in We are already paying over $235 bil- hear. That is not what I hear from peo- frustration and then in 1994 where peo- lion—$235 billion—a year in interest on ple back home. This is not something ple again voted for change, where the national debt. That is eight times the people of Ohio want to do any more today 80 percent of the American peo- what we currently invest in education. than we do. It is something, however, ple want a balanced budget amend- It is 50 times what we invest in job that they are convinced we have to do training programs. Every year we add ment—if we cannot pass it today, I am as a last resort. not sure that we ever can. to this mountain of debt, every year we In the short term, passing the bal- Last November, the American people are committing more of tomorrow’s re- anced budget amendment is no quick voted for change. For 25 consecutive sources, our children’s resources, to fix. It will create a monumental chal- years, Congress has failed to balance pay for Congress’ failures today. lenge for this very Congress because for By the year 2003, just 8 years from the budget. The last time we balanced the first time in a generation we will now, spending on entitlements and in- a budget in this country I was a senior not be permitted to take unlimited terest alone will exceed 70 percent of in high school, 25 years ago. Congress the whole Federal budget. Take out de- spending demands and just tack them has amassed a $4.7 trillion national fense and you leave just 15 percent of on to the deficit. Future Congresses debt that our children and our grand- the budget for all the discretionary will have to deliberate, will have to children and our great grandchildren spending—all the discretionary spend- make the best choices they can and are going to have to deal with. That, ing—on our domestic needs; less than will have to be judged by the American Mr. President, is what the American 15 percent cumulative total for edu- people on the results that are pro- people voted to change in 1994. cation, for job training, for Women, In- duced. For decades, they have heard prom- fants and Children Program, and for all Over the short term this will not be ises from Congress. The American peo- the other programs that help the pleasant, but over the long term this ple, people that I talk to, are tired of American people at home; just 15 per- constitutional amendment is the great- promises. They want action. They are cent of the budget for all these pro- est gift we can make to future genera- tired of words. They want a balanced grams combined. tions. Last week, a columnist in the budget and they want a balanced budg- We have heard a lot of talk on the Wall Street Journal warned Senators et amendment. They know that Con- floor about how a balanced budget that their grandchildren will remember gress is simply incapable of balancing amendment will stop us from being the votes they cast on this amendment. the budget unless it is forced to bal- able to help the neediest in society, I believe the author of that article was ance the budget. Eighty percent of the how a balanced budget amendment will correct. That is why I am proud to vote American people support the balanced unduly penalize our children, and how yes on this very historic measure. I budget amendment because they real- it will make it very, very difficult for urge my colleagues to do the same. ize that unless we change the budget us to invest in our future. I believe Mr. President, I yield the floor. process in a fundamental way, we are that just the opposite is true; that un- Mr. THOMAS. Mr. President, I rise in not going to change the result of the less we pass a balanced budget amend- support of the balanced budget amend- budget process. Let us make no mis- ment, future Congresses, future genera- ment. take about this, only a constitutional tions will have no money left to invest We will have talked about it tomor- amendment can create this funda- in our young people. row for 30 days. We talked about the mental change. Mr. President, following up on these pros and cons. We have debated and As long ago as 1921, Congress was try- figures, if you go out to the year 2012, discussed it. Actually, I suspect it is ing to change the budget process by just 17 years from today, there will be fair to say that most everything that statute. This strategy clearly has not nothing left in the budget for these so- can be said has been said. I suppose the worked. At least six different times, cial needs—zero, no money at all for thing that has not happened is not ev- maybe more, this Congress has passed our children. Every last red cent in the erybody said it yet, and that seems to statutory balanced budget require- Federal budget will go to entitlements be why we go on as we do. It is not a ments, all to no avail. History proves and interest payments. new topic. It is not as if this issue just that Congress cannot balance the budg- The year 2012 has special significance came up. It has been talked about for et by statute, and it has been true no for my wife and myself, because just a years. As a matter of fact, it has been matter which party was in power. year before that, our grandson, Albert, voted on in the last several years. When we had a Republican President, will graduate from high school. In the Mr. President, you and I came from we had a deficit. When we had a Demo- year 2012, our daughter, Anna, should the House. We talked about it last crat President, we have had a deficit. be in her first year of college. If we do year. We voted on it last year. It was When we had a Democrat Senate, we not act today, Albert, Anna, and other voted on here. So it is not a new topic. had a deficit and, yes, even with a Re- children will pay a severe human cost. Interestingly enough, everyone who publican Senate, we have had a deficit, Tomorrow we face a decision about rises says, yes, I want to balance the too. their future, and it is of historic sig- budget; of course, we need to balance There is no better evidence of the nificance. Let us prove by our vote to- the budget. But we have been 26 years bankruptcy of this statutory approach morrow that we can put partisanship and have not balanced the budget. than the current budget that was sent aside and that we can for once act to- They rise and say, well, but we do not to Capitol Hill by the President. The gether in the long-term best interest of need an artificial discipline to do that; President’s budget proposes deficits in our country and of our children. we just simply need to do it. the neighborhood of $200 billion, but Mr. President, let us just admit that It is true. We have not done it. We even more shocking, there really is no well-intentioned people of both parties, have not done it for 26 years.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00052 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3191 Many who oppose it have been here do it. But there is no reason why it floor by earlier speakers. Over the past for a very long time, and I am not crit- cannot be done if it is justifiable and, 33 years, we have balanced the budget ical of that. But it has not happened. indeed, it can be. once and that was a quarter of a cen- Many who oppose it have been in very People and the legislatures of this tury ago in 1969. Had the Social Secu- important positions dealing with the country I think deserve an opportunity rity program not generated a surplus, budget. They have not balanced it. And to vote on a constitutional amend- we would not have balanced the budget you can argue about the reasons why. ment, if it goes there, and it should. We in that year either. Furthermore, the You can argue that it is difficult to have talked about the Founding Fa- forecast put out by the Congressional have an amendment in the Constitu- thers having not put it into the Con- Budget Office and the administration tion. But the fact is if you want to stitution, but I recall Thomas Jeffer- show that absent dramatic action on change the way things happen you son said if there was one change he our part, these deficits are not going to have to change the process. You cannot could make, it would be to limit over- end any time soon. It is not that we are continue to do things the same way spending. just on the edge of ending the deficits you have been doing them for 26 years I had the honor the other day to read through normal action, absent this bal- and expect some kind of different re- George Washington’s Farewell Address anced budget amendment. sult. again, and he spoke to it. Let me For example, CBO predicts that the I think the people of this country ex- quote. deficit in the year 2005, 10 years from pect the decision. I am delighted that now, could be as high as $421 billion. As a very important source of strength and The President’s budget, which was re- we are coming to a decision tomorrow. security, cherish public credit. One method I think we have been too long. of preserving it is to use it as sparingly as leased early this month, forecasts Fed- I respect the notion that the Senate possible, avoiding occasions of expense by eral deficits of approximately $200 bil- is here to deliberate, to take longer, I cultivating peace, but remembering, also, lion for each of the next 5 years. So in suspect, than the House typically that timely disbursements, to prepare for the next 5 years the President himself takes. Nevertheless, there comes a danger, frequently prevent much greater dis- predicts we are going to have $200 bil- bursements to repel it. lion of deficits. The Congressional time when the question needs to be Budget Office says 10 years from now brought to a decision, and that is what And then he said: those $200 billion deficits are going to voting is for and we are going to do Avoiding likewise the accumulation of debt, not only by shunning occasions of ex- rise to $421 billion a year. that. Even worse than this dire prediction I have a hunch that many of the pense, but by vigorous exertions, in time of of what is going to happen is that the things we have talked about have real- peace, to discharge the debts. . . . President has taken little action to ad- ly been sort of a reason, a justification We have not done that. And that is dress this problem. The $81 billion of for voting no when in fact the big dif- what this is all about. This provides deficit reduction in the President’s ference is a philosophical difference. It the discipline to make the tough deci- sions that we have to make. plan is really relatively minor when it seems to me there is a great deal more is realized that this $81 billion of def- involved here. As important as the fi- So there are reasons to do it. It is morally and fiscally responsible. Ask icit reduction occurs over 5 years, and, nancial aspect is, as important as the $60 billion of those savings come from morality of being fiscally responsible anyone should we balance the budget, should we spend more than we take in keeping spending at the current level, is, there is also a broader question. not from making any cuts; just from That question is what kind of a Federal on a consistent, 26-year basis? The an- swer is no, of course not. keeping it where it is. Government do you see us having? Why is it bad that the Federal Gov- Ask anyone, should we have to bal- What do you see as the role of the Fed- ernment routinely spends more than it ance the budget? The answer is yes, of eral Government? Do you see it as an takes in? We are told in soothing tones course, we should. We hear it every ever-increasing bureaucracy that grows by the administration that it is very day: I am for a balanced budget. We do continuously year after year? important to note that the deficits for If you take a look at a chart—I did not do it. There is no reason to expect each year in the future are going to be not bring a chart—of spending, spend- that we will unless we change the proc- a lower percentage of the gross domes- ing has continued to go up. Last year ess. Is the current situation out of con- tic product. That is somehow meant to and even this year, in this budget, in trol? Of course, it is. be grand news. What the administra- my hometown paper it said administra- Do the States do it? Of course, they tion tells us is do not worry, that for tion cuts. It leads you to believe there do. I come from a legislature in which each of the future years the deficits are is less spending than the year before. the Constitution provides for a bal- going to be a smaller part, an ever de- Not so. Spending has gone up. Spending anced budget. We do it. We live with it. creasing part of the Federal budget is going up 5.5 percent. Spending has It works. And we can deal with it. each year. Somehow that is meant to gone up every year. Spending will go So, tomorrow we vote, and I am de- be good news, even though the dollar up under the budgets that are being lighted for that. I think it will be a amounts of the deficits constantly talked about in the House. So spending very important vote. I think it will be grow. continues to go up. a crucial vote. I think it is a vote that The problem is that every year we There is a philosophical difference, helps not only to shape the future in run a deficit we have to borrow to fund however, as to whether you see the terms of spending but to shape the fu- the shortfall. From the beginning of Government as ever growing or wheth- ture in terms of the kind of Govern- our country until today, we have in- er you see it as being limited, whether ment and the extensiveness of Govern- curred a debt—I believe the Senator there ought to be a transfer or move- ment that we have. If there was one from Ohio touched on this—we have in- ment toward emphasizing State and thing that was clear from this Novem- curred a debt of about $5 trillion with local governments more, the private ber’s election, at least the people whom the overwhelming portion of that accu- sector more, more personal responsi- I represent said we have too much Gov- mulated over the past 15 years. The bility, or do we continue to do more ernment and it costs too much. We cost of servicing that debt, the gross and more in the Federal Government. have too much Government and it interest, will total $339 billion in 1995. That is part of what we are talking costs too much. That is what this vote In 1995, just to pay the gross interest about here—not only the money but is about, doing something about that. on the debt is $339 billion. This is the also the role of the Federal Govern- I yield the floor. second largest expenditure in the Fed- ment. The PRESIDING OFFICER. The Sen- eral budget after Social Security. To We have heard a great deal just today ator from Rhode Island. put this number in perspective, our about how there are exceptions, there Mr. CHAFEE. Mr. President, there is gross interest expense for 1994, this $339 are times when things need to be done, no greater problem facing the country billion, is more than the entire budget and that is, indeed, true. It also in the today than our continued failure to of the country 20 years ago. Just imag- budget amendment allows for excep- balance the Federal budget. Unfortu- ine if we were not spending that $339 tions. It allows for changes. It does nately, this is not a new phenomenon, billion, what we could do to improve take a majority, or a supermajority to as has been pointed out here on the our education, or to spend some of that

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00053 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3192 CONGRESSIONAL RECORD — SENATE February 27, 1995 money—not all of it but some of it—to The Federal Government’s reliance on and a legitimate reason for running a help our education, help our health borrowing to pay its bills crowds out deficit. This could happen if there is a care system, or to bolster our efforts to the private sector. The Federal Govern- recession, if there is a natural disaster. fight crime. ment comes in, has to borrow money— Absent those situations, the country Aside from diverting resources that obviously there is not money left to has to run a balanced budget. could be used for much better purposes, lend at a low rate to you and me and This amendment will make fiscal re- the deficit also puts a tremendous businesses and others who want to bor- sponsibility the norm rather than the strain on our national economy. The row. exception. As has been said, the Fed- most notable effect of this is on our in- The worst consequence of this fiscal eral Government has run a deficit for terest rates. Alan Greenspan, who is irresponsibility is that we are jeopard- 25 straight years. There have been Re- Chairman of the Federal Reserve, re- izing the economic futures of our chil- publican Presidents. There have been cently testified before the Finance dren and grandchildren. We are living Democratic Presidents. There have Committee. This is what he said: beyond our means and we are passing been Republican Senators. There have Investors here and abroad are exacting the bill to these future generations. been Democratic Senators. Neither from issuers of dollar-denominated debt an Recently I ran across a paper which body is free from blame. The truth is extra inflation risk premium that reflects discussed the idea of generational ac- there has not been the will to make the not their estimate of the most likely rate of counting. What does this mean? It is tough decisions to balance the budget. price level increase over the life of the obli- the process of measuring how Govern- gation, but the possibility it could prove to I listen to these people say there is ment policies affect the distribution of no need to have this, that all we have be significantly greater. income and wealth among different Let us translate that into English we to do is show some courage. But the generations. To make this comparison, truth of the matter is, we have not all can understand. What Mr. Green- the authors calculated the lifetime net span was talking about was a risk pre- shown that courage. So we have to go tax rates. My generation—I was born in to this artificial procedure, and the mium. What is a risk premium? A risk the 1920’s—is facing a net tax rate over premium is the extra amount that any- Senator from Connecticut says it has our lifetimes of 26 percent. Of every- more words than the first five amend- one who issues debt, anyone who issues thing we earn, 26 percent will go for a long-term bond, must pay in interest ments. So what? What does that prove? taxes. For somebody who is born in The amendment before us today de- because the buyers of that bond can 1991, the lifetime net tax rate is not 26 predict with some measure of surety mands the same fiscal responsibility percent, it is 34 percent. That is not so from the President that it establishes what the rates will be in the future but bad, you say—34 percent. I can handle they have to add to it a factor, what for Congress. The administration has that, perhaps. to submit a balanced budget. Mr. Greenspan called the risk pre- But according to this analysis, if we I am grateful that the sponsors have mium, because the country is running do not take action to improve the Fed- not sought to include a three-fifths ma- such large deficits that the fear of in- eral domestic situation, future genera- jority requirement for raising revenue. flation is always there; the fear that tions, generations born, grandchildren That was discussed. You have to have inflation will come, that the Govern- born, children born, individuals born, 60 votes to increase taxes. That was re- ment will print money in order to get starting in 1995, 1996, 1997 will face life- jected by the House, and rightfully so. rid of this deficit. Thus this risk pre- time tax rates not of 26 percent, not of That provision would be disastrous for mium is added to any issuance—Ford 34 percent, but of 70 percent. In other this country because it would signifi- Motor Co. or the U.S. Government— words, future generations can look for- cantly hamper our ability to govern. anybody who issues bonds that might ward to handing over 70 cents of every Facing a deficit, Congress would in all last, for example, 20 years. If the buyer dollar earned to the Government if we likelihood be forced to cut spending of that bond were assured that this do not reverse our course. country was on a process of balancing For the past few years the adminis- rather than to raise revenue because its budget, then he would not seek that tration has also included a the latter—to raise revenue—requires risk premium and the bonds could be generational analysis in its budget doc- 60 votes. issued at a lower interest rate. Thus uments. Unfortunately, the President I support spending cuts over tax in- these artificially high interest rates af- chose to delete that section from this creases but feel it would be unwise to fect all Americans. Families pay a risk year’s budget. But the figures were tilt the playing field against raising premium when they borrow money for similar to the ones I just pointed out. revenue. In other words, you need 60 a home or when they borrow money for Why will future generations face such a votes to increase taxes but you only a new car or to finance their children’s daunting tax bill? Consider the obliga- need 51 votes to cut spending. I would education. tions we have levied upon them. The not support this amendment if it had The Federal deficit also has a nega- Social Security program has been gen- the three-fifths majority for raising tive effect on future economic growth. erating surpluses. revenue. But fortunately, it is not in Our potential to expand the economy The surpluses will turn. They will no there. in the United States is directly linked longer start, will end, and pretty soon The amendment includes a process to the amount we invest in physical the program will not be bringing in whereby the requirements can be and human capital. What are we talk- surpluses. That is in the year 2013. waived by a simple majority for any ing about, physical or human capital? That leaves workers in the middle of year in which the country is in war or We are talking about new machinery or the next century with a hefty bill to when the United States is engaged in a we are talking about training the work pay to provide retirement benefits for military conflict. I think these are le- force, bringing its skills up to date. We those who are retiring today. On top of gitimate circumstances. are talking about providing a founda- that, we have incurred this $5 trillion In section 7 of the amendment, it tion for increasing our output of goods in debt, which I mentioned before. That states that the total receipts, all re- and services. With this higher produc- is likely to increase by $750 billion even ceipts, of the U.S. Government except tivity comes a higher standard of liv- with the passage of this balanced budg- those derived from borrowing and total ing in our country. To achieve this, et amendment. Obviously, at some outlays should include outlays for the however, we must have a pool of na- point, all of this has to be repaid. U.S. Government except those for the tional savings from which the invest- What exactly does the balanced budg- repayment of debt principal. What this ment can be made. et do? Very simply, it prohibits Federal means is that every dollar that comes Unfortunately, our national savings outlays from exceeding Federal re- in to the Treasury and every dollar rate has declined dramatically over the ceipts unless a three-fifths majority of that goes out of the Treasury will be last decade, partly because the Federal both Houses of Congress approves a counted in determining whether the Government has engaged in what is specific deficit. In other words, it says budget is balanced. known as dissaving. In other words, it that Congress can only spend what it is Again, this makes sense. This is the is not saving money, it is borrowing willing to collect in taxes, unless Con- way we run our families. We count the money through this deficit spending. gress determines a specific reason for dollars that come in and the dollars

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00054 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3193 that go out, except for borrowing, obvi- more. You can try different ap- of the Federal Government. There will ously. proaches. But the end result is you be some who will simplify things and Much of the efforts to derail this res- have to get there. That is what we have say that the role of the Federal Gov- olution has centered on excluding cer- said. ernment is simply to deliver my mail tain programs from the balanced budg- The so-called right-to-know amend- and protect my shores. Other than et amendment. This all started in the ment to the resolution before us really that, that is about as much as I need Judiciary Committee when an effort is a smokescreen thrown up by those out of Washington, DC. But we know it was made to exclude Social Security. I who had no intention of supporting goes a little further than that. Any- find this inconceivable. Why would we this proposal, whether or not we had body that has any degree of responsi- adopt as part of the Constitution an ex- outlined the specifics as to how we are bility understands there is more to it clusion for Social Security or any going to get there. The fact is, there is than that. Nonetheless, the elections of other aspect of the Federal budget? I no agreement upon the path to reach a November 8, as bad as someone would am for protecting the fiscal soundness balanced budget. The path that I would like to admit, did tell us to sit down of the Social Security system. But it is subscribe to is likely different from the and rethink just exactly what the role absurd to exempt a program that rep- path that others would subscribe to. and mission of the Federal Government resents 29 percent of all Federal re- Any plan will be the product of numer- really are. ceipts and 22 percent of all outlays. A ous compromises and the give and take I can honestly say that this issue has big chunk of the budget would be dis- of a normal political process. All that really been talked about and studied regarded in all of this process, if that is going to take place once the require- for the last 4 weeks, completely aired had been adopted. Thank goodness, it ment is established. on all ramifications of it, and that is was rejected. To those who do not support the reso- the way the Senate is supposed to Exempting Social Security receipts lution before us, the question is: What work. I could not agree more with my would provide a perverse incentive for would you do? How would you get friend from West Virginia, who prob- future Congresses to shift Social Secu- there? Are you content with the cur- ably has the strongest sense of the rity revenues to the general fund. This rent situation where the annual defi- duty and the responsibility of this should be very attractive since the pro- cits exceed $200 billion, and in the fore- body. I think we on this side of the gram currently collects more in rev- seeable future going up greater than aisle have approached it the same way. enue than it pays out in benefits. But that? Ten years from now, it will be There has been no real serious move to this would undermine the actuarial $451 billion, as I said. Do people believe cut off debate, as we want to hear all balance of the Social Security trust we can put this problem off for another sides of this story, because we are talk- fund, and would certainly require dra- day; that somehow it is going to get ing about a subject that has very seri- conian changes in the future in order easier? Do you believe we are improv- ous ramifications from this town, to to stave off bankruptcy when the baby ing our children’s future by dropping the White House, to the courthouse. boomers retire. this massive debt in their laps? Every But we must take stock, and it is what Critics of the balanced budget previous effort to balance the budget I believe would put America back onto amendment have argued that it is a without an amendment to the Con- the road of steady economic growth sham, that it avoids, as I mentioned stitution has been a failure, as I men- and stability. previously, the tough choices required tioned. Why has that been the case? After years of talking about bal- to balance the budget. I disagree. What The answer is simple. Once the targets ancing the budget, instead of just tin- this represents is the first and most become too difficult to meet, Congress kering around the edges of the deficit, important step in a long and difficult changes the law or budgets. it is time now to take action. It will journey to fiscal responsibility. It sym- This resolution makes it difficult for impose a discipline on the budget proc- bolizes the tide has finally changed; we us to avoid our responsibilities. The ess, and it will impose a discipline on are committed to living within our task is monumental, but the con- this Congress. Past efforts to balance means, and we are willing to embody sequences for our failure are far worse. the budget have just been able just that principle in the basic document of If this amendment is defeated, the ones maybe, at times, to put dents in the the Nation, on which the foundation of who will be hurt the most are future deficit, but no dent at all in the na- all our Government rests; namely, the generations of this country. tional debt that keeps climbing. We Constitution. So for our children’s and our grand- hear two words being interchanged a Other fiscal disciplines we have en- children’s sake, and for those of future lot in our news accounts—debt and def- acted, while they are important—and I generations, I fervently hope that this icit. They say, if you cut the deficit, voted for every single one them—have balanced budget amendment is ap- you are cutting the debt. Well, basi- not done the job. The Gramm-Rudman- proved here, and approved in the States cally you are only cutting the degree Hollings deficit control laws, the fire- likewise. to which debt is accumulated. We def- walls, the discretionary spending caps, I thank the Chair. icit spend and we create or accumulate the pay-as-you-go rules—all of these we Mr. BURNS addressed the Chair. debt. have tried. As I say, I voted for every The PRESIDING OFFICER. The Sen- So this will put more than a dent in single one of them, and have supported ator from Montana. it, we hope. This measure would actu- them when they have attempted to be Mr. BURNS. Mr. President, I rise ally put some teeth into the efforts to amended. But they failed to break the today in strong support of the balanced balance the budget. In other words, we attractive lure of deficit spending. budget amendment to the Constitu- might turn the old saying around and Opponents have also argued we tion. I do not think I have seen a time say the bite will be worse than the should not pass a balanced budget in my life when we have approached a bark. So on this issue the bottom line amendment until the supporters of it crossroads where the decision could be is one of responsibility—responsibility outline specifically how we reach that clearer, especially when we have people to every citizen in our country and fu- goal. This is nonsense, in my judgment. all over this country at all levels of ture generations and to economic pros- It is like a doctor saying you have to government—from the county level, perity. It is time that Congress lives up lose 40 pounds. ‘‘I am not going to lose the city level, the State level—reas- to its future obligations and, of course, 40 pounds until you tell me specifically sessing the primary role of govern- take responsibility for our actions. We how I am going to do it.’’ Well, the ob- ment. What is the mission of govern- have to ask the American people to jective is, if you want to keep your ment? What is the mission of a city help us. This is a crisis. It is as much health, you had better lose that 40 government, of a county government, a crisis to our economic freedom as it pounds. There are a variety of ways or of the government that most of— is if we were in war and our political you can do it. You can work those out and, of course, the legislatures that are freedoms were at stake. yourself, as long as you get there, to in session across our Nation today re- I am being told by the citizens of lose the 40 pounds. You can go on a assessing the role and what their mis- Montana, yes, we are willing to fight diet. You can eat less. You can go sions really are? And, yes, we are going this with you. We cannot do it alone through health plans. You can exercise through that here in this town, the role here in this body or in the other body,

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00055 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3194 CONGRESSIONAL RECORD — SENATE February 27, 1995 the House of Representatives, or in this erty taxes in order to provide the needs we can cut out a little waste and look Government, unless we get support and and services in a county called I–105. at the priorities that we are going to cooperation from every citizen across We dealt with that. We also had, in have to set in order to keep this soci- this great land. They understand what the middle of the 1980’s, a declining tax ety on an even keel. is at stake. They understand that it base. Agricultural land went in the Balancing the budget is going to take takes sacrifice. They understand in tank. We maintained that. We were some hard decisions, some political, their daily dealings with everybody forced to balance the budget, so we very distasteful decisions, but the re- else in the business world, or the pater- made some of those very, very, very ward will be a balanced budget and a nal world, that they have some obliga- tough decisions. more prosperous America. And the real tion to their communities, their And those people who were in charge growth of America will start at the churches, their schools, and their of the different departments in the grassroots. county came in and said, ‘‘OK, we can friends, and they are willing to go It may surprise more of our friends do it with this, if there are promises down the road shoulder to shoulder and that the new wealth created by any so- for later.’’ But we could not promise help us get this done. It is obligations, ciety, the new wealth starts with the anything later, so we lived within that and not only ours here, but also for soil. It is renewable. It comes every every man, woman, and child that lives budget. I tried to keep my own family on a year. And, God willing, it will feed and in this great country. We have been liv- clothe us forever. As we look at that, ing on the credit card for quite a while. budget and every time we got off of it, we paid for it. We paid for it every then we must get our house in order Now is the time to put away those here. credit cards, get serious about paying time. So it is time the Federal Government So I beg my colleagues, I implore off the overdue account, the incessant becomes an institution which has to them, to pass this balanced budget spending; and borrowing, of course, take care of its checkbook, too. The amendment. There will not be a more must cease. The debt of more than $4.7 challenge lies with all of us. The chal- important vote that you will cast for trillion is going to continue to climb, lenge is the spending priorities for our responsibility—and, yes, an obligation unless we get America’s help—help to Nation. It will force us to set priorities to the American people—than this vote keep this Government from this busi- to see what this mission is all about, you will cast this week on the balanced ness of spend and borrow, spend and this goal or role of Government. budget amendment. borrow. The Federal Government consumes 23 There have been a couple of packages I want to congratulate my friend percent of the GDP now. The current that have come up that had tax hikes from Illinois, PAUL SIMON, who is on projected growth rate of spending at 2 the floor, for the work he has done in them in the last 5 years that I can percent a year is a lot faster, 2 percent remember. I voted against each one of with this. His roots are in southern Il- faster, than our economy. So what do linois, where traditions of communities those because not only inside that was you do? You pull up your belt and the taxes, new taxes imposed on this coun- and families go deep, a great sense and reins at the same time. a great tide of the land, middle Amer- try in one way or the other; some If seems funny to me that we are re- called it user fees, and some were ica, that understands what commu- luctant to set priorities. What is really nities are all about. They know it called something else. Nonetheless, it important to us as a community? was an increase in taxes because there takes money to provide Government Would it surprise you that there are services. They also know it takes re- was no cutting on the other side. actually organizations that are not I have heard a lot of folks stand on sponsibility and a little bit of reality Government organizations that are to make it work here in America. this floor and be critical of the Reagan willing to assume the responsibility of This is an important vote. It is an years when we, yes, cut taxes, but we taking care of those things that add to important vote for all of us who call did not stop our spending. There is the quality of life of our own neighbor- ourselves Americans. enough blame in that to go around for hoods and much our own communities? everybody. I was not here then. Would it surprise you that service I know that there are those who So we will break the cycle of contin- clubs and many organizations and our would make the argument that we are ued deficit spending at the risk of our churches and how many fraternal orga- tinkering around with the Constitu- long-term economic security. We can- nizations are willing to take on a little tion. But I think it was even Jefferson not and must not ruin our health now bit of responsibility for the quality of who feared the day when we could for short-term gains. So the reckless life of all the citizens that live in that learn to borrow money against future spending must come first and be put community? They are not asking the collections on taxes. under control. For as long as I have Government for anything. They say, Even George Washington—and the been here, I have been concerned with ‘‘Just stand back. Let us take care of other day, Senator CRAIG THOMAS, of spending. It is difficult to challenge ourselves.’’ Wyoming, read George Washington’s the balance of the needs of our country You know, we used to do that. We Farewell Address; and I had the great with revenues we do not have without used to build great homes. We used to privilege of reading that myself—one of resorting sometimes to more taxes or build facilities to take care of our own, his fears was public debt. higher debt. We had an obligation and so to speak. What happened to that? But Jefferson went on to say that we had to fulfill that obligation. Now Did Big Brother step in and say, ‘‘We this Constitution every now and again we must find a way to balance obliga- can do it better,’’ and so they loosened needs to reflect the needs of the time, tion with responsibility. the ties that we had in our commu- to be changed to deal with the needs or We have heard the arguments here nities? the emergencies of the time. So those against the balanced budget amend- They worked pretty good for a long who would fear change, I do not think ment. The arguments show more than time; built a great and free nation. No this change is not unwarranted. anything else how this is not a gim- other nation is as free economically, A vote ‘‘yes’’ on this amendment mick. There are those we have heard politically, or even in private rights as would do much to restore the account- say this is a political gimmick and this country is. No other country can ability and responsibility of this Con- that we are posturing with the Amer- feed and clothe itself as well as this gress in the eyes of all citizens in this ican people. But I tell the American country can. No other country has a country. people that nothing could be further food production and processing and dis- Thank you, Mr. President. from the truth. Forty-seven other tribution system like this country has. States, including my State of Montana, Government did not build it. Ameri- I yield the floor. already maintain a balanced budget. I cans built it, because of not only a Mr. ABRAHAM addressed the Chair. was a Yellowstone County commis- sense of duty but also a sense of feed- The PRESIDING OFFICER (Mr. sioner, the largest county in Montana. ing and clothing ourselves in this great ASHCROFT). The Senator from Michi- We were forced to live within that society. gan. budget. We had a special initiative So there is plenty of room to cut in Mr. ABRAHAM. Thank you, Mr. called 105 that we could not raise prop- the $1.6 trillion budget. I am sure that President.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00056 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3195 I rise today, once again, one final The amendment will help reduce the That means that between now and the time, in strong support of the balanced size of Government by severely lim- end of the century we will add well budget amendment to the Constitution iting the option to borrow money. Cur- over $1 trillion to the deficit. and to urge my colleagues to support rently, when faced with demands for I think that the choice is clear. Ei- this amendment. more spending, the Congress makes the ther we continue spending trillions of Last November the American people easy choice to borrow money. Under dollars we do not have, or we get our fi- sent a clear signal to Washington. the balanced budget amendment, Con- nancial house in order. Either we give They made clear that they are tired of gress will be forced to make the tough up on the idea of getting our spending business as usual. They made clear choices. under control, or we pass a balanced that they no longer will accept, or re- In this way, unless we are in the budget amendment. Either we do the elect, representatives who do not take midst of a crisis severe enough to their responsibilities seriously. They produce a supermajority in favor of job we were sent here to do, or we con- made clear that we must put our finan- deficit spending, Congress will be tinue to spend our childrens’ and cial house in order. forced to control its appetite for spend- grandchildrens’ money and leave them Only when we have re-established ing, or select the even less desirable al- to foot the bill. order can we again represent the peo- ternative of raising taxes. Now, some of my colleagues have ple’s interests as we should. Only when No longer will we be able to borrow said that they like the idea of a bal- we have re-established the discipline against our childrens’ future. No longer anced budget—but they fear one or an- necessary to make hard choices can we will we be able to continue increasing other horrible unintended consequence begin again to recognize what is impor- the size of Government, oblivious to its of this amendment. From judicial tant and what is not so important. costs to our pocketbooks and our lib- budget writing to Presidential im- Only when we begin to balance our erties. No longer will Government be poundment, some Senators fear there own budgets—to sit down and decide able to duck responsibility for the way are dangers lurking in this amend- how much of the people’s money we it spends the people’s money. ment, dangers to our status as an insti- can afford to spend—will we again have Mr. President, I remember well what tution and to the Republic itself. fully earned their trust. the folks in Michigan told me when I The simple fact is that we are spend- was campaigning for the Senate a few Mr. President, we must not shrink ing more than we should as a govern- months back. From Detroit to the before these phantom dangers. This ment. We are spending the people’s Upper Peninsula, from Grand Rapids to amendment is a model of clear, concise money on things the people do not Saginaw, Michiganders all expressed drafting. It does a single thing, and need, or that the people of a free coun- the same confusion about the way Con- does it well. It says that Congress now try can more safely and efficiently pro- gress does business. They could not un- must balance its budgets the same way vide for themselves. derstand why Congress could not oper- families and businesses do—by spend- The people demanded a more effi- ate the way they did in their families ing no more than it takes in. cient government this past November. or the way businesses did in trying to I will not restate all the arguments They also demanded a smaller Govern- meet a bottom line. again here. But it is clear to me that ment. One that is more careful in how The people did not ask for a fancier this simple, policy-centered amend- it spends their money and more careful bookkeeping method that will make it ment will provide the discipline we in not to interfere unduly with their look as if the budget is balanced when this institution need to rethink our lives. it really is not. They did not ask for a priorities and get spending under con- We have a bloated, inefficient Gov- balanced budget except for this or that trol—and nothing else. ernment because for decades Congress program. A balanced budget means just has not felt the need to sit down and that. If you put spending programs off We should concern ourselves less decide what it has a right to spend the budget you are simply fooling yourself with phantoms and more with our re- people’s money on, and what we must, and the American people. sponsibilities to our Nation and to our as a government, do without. But the people were not asking that families. You see, those who oppose the bal- we budget exactly as if we were a fam- Mr. President: My family is impor- ance budget amendment, or complain ily. The big difference between Con- tant to me. I work in large part so that that it will cause too much pain, ig- gress and a family is that a family is I can pass on something to them. I nore the pain our current irresponsible spending its own money. Congress, on hope I can pass on a little wisdom. I deficit spending already causes. Our the other hand, is spending money en- want to make sure I pass on some de- spiraling debt inflates interest rates, it trusted to it by the people. cent habits of hard work and honesty. causes economic dislocation—and high- If a family decides to buy a home it And I also want to pass on as much er taxes on the American people. will go into debt as it invests for the economic opportunity and security to Worse, it leaves our children and future. But the Government is not a them as I can. grandchildren a legacy of debt. family. Government is the servant of After all, every year we must pay families. It is our duty to spend no Trillions of dollars in debt is not my hundreds of billions of dollars to retire more of families’ hard-earned money idea of a good inheritance to leave to old debt, even as we add new debt. Our than we need to. my kids. Neither is a government that current irresponsible spending causes And massive public spending projects has gotten out of control, that spends economic pain; pain which will only all too often are boondoggles rather money with little idea of what is im- get worse if we allow it to continue. than good investments for America’s portant, that has no discipline in its This amendment will not suddenly families. budgeting procedures, that interferes eliminate Federal spending. It will not In fact, it seems to me we should not with the daily lives of its citizens sim- even suddenly eliminate deficit spend- even need to debate the need for a bal- ply because to do so is cost-free. ing. Until the year 2002 we will con- anced budget amendment because over Let Members protect our children tinue to spend more than we take in— the last 25 years Congress has proved from debt and from irresponsible gov- only at a less horrifying pace. But this that it is incapable of managing effec- ernment. Let Members limit govern- amendment will reintroduce discipline tively the Nation’s pursestrings. ment and expand freedom. Let Mem- to the budgeting process and help us And President Clinton’s latest budget bers pass the balanced budget amend- get a grip, once again, on our spending makes clear that he has no intention of ment. priorities. doing anything to fight the deficit in It will force those of us in this Cham- the years ahead. According to his own I yield the floor. ber to actually sit down and decide budget projections, Federal spending Mr. SIMON. Mr. President, I probably what our priorities ought to be. Instead will grow from $1.5 trillion in 1995 to agree with the editors in the New York of spending money on everything, we over $1.9 trillion at the turn of the cen- Times 90 percent of the time. Today will, for a change, debate which pro- tury. they have an editorial on ‘‘Unbalanced grams we should, and should not, fund Deficits will remain near $200 billion Amendment,’’ which shows an emo- at the taxpayers’ expense. in every year through the year 2000. tional attachment to a position that I

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00057 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3196 CONGRESSIONAL RECORD — SENATE February 27, 1995 do not think is very rational. I ask Take another unintended consequence. Who pays the interest in our coun- unanimous consent that their edi- When savings and loans went bankrupt dur- try? By and large, people of limited torial, be printed in the RECORD at this ing the 1980’s, the Federal Government means. Who collects the interest? bailed out depositors with borrowed money, point. thereby preventing a banking panic. But Those who have enough means to own There being no objection, the mate- under the proposed amendment, the Govern- the T-bills. That is not the average cit- rial was ordered to be printed in the ment could not react instantly unless a izen. RECORD, as follows: supermajority in Congress approved. That is redistributing money to UNBALANCED AMENDMENT The balanced-budget amendment appeals those who are more fortunate. It is in- to taxpayers who demand that the Govern- Tomorrow’s vote in the Senate on the bal- ment spend their money wisely. But Sen- teresting, of the $339 billion we are es- anced-budget amendment is crucial for the ators Nunn, Ford, Conrad, Dorgan and timated to pay for interest this year, Republican agenda to chop Government pro- Breaux need to recognize that this honorable that is roughly twice what we will grams into bits. The outcome is also crucial sentiment cannot be wisely embedded into spend on our poverty programs, 11 to the nation because the pernicious amend- the Constitution. ment would do enormous fiscal damage. Pro- times what we will spend on education, ponents are alarmingly within three votes of Mr. SIMON. Mr. President, I would and 22 times what we spend on foreign winning. like to comment on the editorial. economic assistance. The core of the amendment would require First, they say it is unnecessary. Then they say it is unenforceable. If the Government to balance its books unless Federal deficits have indeed been too it were unenforceable, my good friend— three-fifths of the House and Senate vote to high. That poses a threat that bor- and he is my friend—Senator BYRD, run a deficit. To the wavering Democrats— rowing will siphon savings away from would not be fighting this amendment John Breaux of Louisiana, Sam Nunn of productive private investments. like he is. Of course, it is enforceable. Georgia, Wendell Ford of Kentucky, and Clearly, that has happened already. They say the amendment fails to pro- Kent Conrad and Byron Dorgan of North Da- The Federal Reserve Bank of New York kota—here are five unassailable reasons to said between 1978 and 1988 the deficit vide an enforcement mechanism. When vote no. you require a three-fifths vote for the Unnecessary.—Federal deficits have indeed cost 5 percent growth in our national income. increase of the debt, you have a very been too high. That poses a threat that bor- powerful enforcement mechanism. rowing will siphon savings away from pro- But the fact that borrowing must be con- ductive private investments. tained does not imply it ought to be elimi- They say it is irrational, Federal But the fact that borrowing must be con- nated—any more than family borrowing, to bookkeeping lumping ordinary spend- tained does not imply it ought to be elimi- buy a house or pay tuition need be elimi- ing with long-term public investments, nated—any more than family borrowing, to nated. a point they made earlier. The reality buy a house or pay college tuition, need be I will get into that because that is is, while a family has to borrow for a eliminated. A prudent rule would keep Fed- stressed later. home or a college education, the Fed- eral debt growing less quickly than incomes. A prudent rule would keep Federal debt eral Government does not, and frankly, This rule would justify deficits of about $200 growing less quickly than incomes. This rule billion a year, close to current levels. even a State the size of Illinois does would justify deficits of about $200 billion a not have to. I served in the State legis- Misleading.—Proponents claim the amend- year, close to current levels. ment would protect future generations lature for 14 years and served 4 years as against ruinous interest payments. True, to- That is what the GAO calls stum- Lieutenant Governor. A State the size day’s children will owe taxes when they grow bling along at the present level. But, in of Missouri—and I do not mean this up to pay interest on Federal debt. But pro- fact, the CBO forecast is that those disrespectfully of the State of the Pre- ponents ignore the fact that the tax pay- deficits are going to escalate, and esca- siding Officer—is in a little different ments will flow right back to these children late significantly. We have shown we situation than a large State. But in the as owners of Government bonds. do not have the political will to do Unenforceable.—Because key terms of the State of Illinois, frankly, we do not anything about it. need to do it and the Federal Govern- amendment—like outlays and receipts—are That is the simple reality. In 1986, undefined, Congress will be able to manipu- ment does not need to do it. this House, by one vote, failed to pass late and evade. Can Congress create inde- the balanced budget amendment. Then It is interesting that the long-term pendent agencies or find other ways to spend investment has gone down as the def- and borrow off the Government books? A the debt was $2 trillion. Now it is $4.8 Senate committee has already written into trillion and we are hearing the same icit has gone up. In fact, the argument the legislative record, used to guide future arguments again, that we can do this is just the reverse, and I would point court decisions, that the Tennessee Valley without a balanced budget amendment. out also—and I mentioned this on the Authority would be exempt from the amend- Second, they say the amendment is floor several times, and the Presiding ment. It should take lawyers five minutes to misleading. Officer has heard me mention this, I stretch whatever ‘‘principle’’ guides that ex- Proponents claim the amendment would am sure—when President Eisenhower, ception to scores of other Government pro- protect future generations against ruinous to his great credit, proposed the Inter- grams. interest payments. True, today’s children state Highway System, the largest sin- The amendment also fails to provide an en- will owe taxes when they grow up to pay in- forcement mechanism. It might simply be- gle capital project in the history of hu- terest on Federal debt. But proponents ig- come an empty gesture or, worse yet, the manity, he suggested issuing bonds. nore the fact that the tax payments will flow courts might step in to tell Congress how Senator Albert Gore, Sr., the father of right back to these children as owners of much it should tax and where it should Government bonds. our present Vice President said, ‘‘Let’s spend. not issue bonds. Let’s increase the gas- I would make three points here. One Irrational.—Federal bookkeeping lumps oline tax and do it on a pay-as-you-go is, Thomas Jefferson said one genera- ordinary spending with long-term public in- basis.’’ Fortunately, he prevailed. vestments. Congress, forced by the amend- tion should no more be willing to ac- ment to cut quickly, would go after hugely cept the debts of a previous generation As of a year and a half ago, the esti- expensive, though vitally important, invest- than the debts of another country. mate was we had saved $750 billion in ments, such as scientific research, costly Thomas Jefferson was right. Second, interest. laboratories and equipment, job training or this argument that this interest just Then they say it is reckless; when other investments that would not produce benefits for years, if not decades. flows back into our own hands ignores the economy slows, tax revenues fall Reckless.—When the economy slows, tax the reality that we have somewhere be- off and spending on unemployment in- revenues fall off and spending on unemploy- tween $650 and $800 billion owned by surance and food stamps rise. This ment insurance and food stamps rises. This other countries, people in other coun- automatic rise in the deficit by trig- automatic rise in the deficit, by triggering tries. In fact, foreign aid to the gering spending serves to mitigate the spending, serves to mitigate the slowdown. wealthy of other countries is at least slowdown. Study after study, including But under the proposed amendment, Con- double the foreign economic assistance the unanimous report of the Joint Eco- gress could easily turn a mild downturn into we give to poor people. And that for- nomic Committee of Congress, then something worse. Unless a three-fifths super- majority saves the day, Congress would have eign economic assistance to the chaired by Senator Lloyd Bentsen, said to raise taxes and cut spending in a slow wealthy is through our indebtedness. we respond too slowly in emergencies. economy—the opposite of responsible stew- Third, this editorial ignores the redis- And because of the deficit, we have ardship. tribution effect of the interest. simply been unable to respond.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00058 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3197 When President Clinton suggested $300 billion greater than what we will rhetoric. In the first year of his Presi- that we spend $15 billion on a jobs pro- spend this year. What we have to do be- dency, he presented a clear agenda for gram to stimulate the economy, and tween now and the year 2002 is to con- deficit reduction. He offered us real $15 billion is not much in a $6 trillion trol the growth of spending so it does specifics, not a lot of rhetoric but real economy, we were not able to get $15 not exceed that amount. That is do- specifics—a program that combined billion passed. I voted for it, but we able. both spending cuts and new taxes. He could not do it. Is it going to cause a little pain? Of had the guts to do that. Former Assistant Secretary of the course, it will. If there were not pain, Mr. President, how did we do that? Treasury Fred Bergsten, who served why, we could pass a balanced budget; The President made his proposals. The we would have done it a long time ago. under Jimmy Carter, said that if we Democratic Congress responded, and We need the discipline of something to would plan for a 2-percent surplus and said OK, we will take on your deficit force us to do the right thing. So my then we could have a triggering mecha- reduction agenda. We know it is going hope is that tomorrow we will do the nism so the President could respond to mean tough votes, but we are going right thing. This is my 21st year in when unemployment passed a certain to do this. level in any region, then we could re- Congress. This is the most important spond quickly. We can respond just as vote I will have cast in those 21 years. So it came up here to the Hill, and quickly and more quickly with a con- We are talking about the future of our we farmed it out to various commit- stitutional amendment. country. tees, and the committees were given Finally, let me make three other We make a lot of short-term deci- assignments, so much of a cut per com- points. One is the New York Times edi- sions because of one thing or another, mittee. And those were tough cuts and torials have consistently ignored eco- and I am as guilty of that as anyone. tough votes—tough, tough votes. And nomic history, and I have to say the Here is one where we ought to ask our- they were brought back here to the Washington Post editorials have done selves not which party is going to ben- floor where we voted them out of the the same. They just act as though we efit, not what it is going to do to each Senate. They went to conference with are dealing by ourselves with an abso- of us politically—and I realize it is the House, and the conference package lutely new initiative and no other na- easy for me since I am not going to be came back. And we voted it out—a tion has ever gone through this debt running for reelection—we ought to be tough vote as reflected by the fact before. asking what is going to happen to the some Members of the Senate were prob- The reality of the history of nations future of our country. I think if we ask ably not reelected because of their vote is that they pile up debts and pile up that question and dig, the answer is on this package. debts and then they become so bad fairly obvious. I do not know why—with the deficit they start monetizing the debt; they Mr. GLENN addressed the Chair. reduction record we’ve achieved over The PRESIDING OFFICER. The Sen- start printing money. And we are head- the past couple of years—the Repub- ator from Ohio. ed to do the same thing. Nations have Mr. GLENN. Mr. President, the real licans do not do the same thing right done that historically when they get question here has been brought out re- now. Instead of talking about grand around 9, 10, 11 percent, except in a peatedly in this debate. What we have ideals—be specific. Do not say trust us wartime situation where there is a heard over and over and over again is and we will tell you later how we are freeze on private and public spending. that we need the balanced budget going to do this. That is not how we did We are heading, according to CBO, to amendment because we need something it during that reconciliation vote in 18 percent. We can take a chance that to force us to act responsibly; we need August 1993, less than 2 years ago. We we will be the first Nation in history to something to give us political courage; stood up and made the hard choices at be able to do that without monetizing we need something that says, ‘‘I am that time, and that is what we should the debt. But what a chance for the fu- going to put a gun to my head and I’m do in dealing with the deficit. That was ture of these pages and my children going to say I’ll shoot if you don’t pre- a tough package in the Senate and in and my grandchildren. We should not vent me from spending again.’’ the House. In fact, it came up to a 50– be doing it. We need the discipline. We have 50 tie, one of the more dramatic mo- Second, it ignores the reality that heard that word over and over. And we ments in recent years in the Senate, the General Accounting Office and CBO have heard repeatedly, both here and and the Vice President had to break and Data Resources, Inc. and everyone over in the House, the term ‘‘political the tie during the vote in the Senate. says if we balance the budget, we will will.’’ They say this forces us to have Now, that bill became law despite the improve the standard of living of our the ‘‘political will.’’ lack of bipartisan support, and we are country. GAO says balance the budget Well, Mr. President, I do not believe now seeing our third year of declining and in two decades you will have an in- that anyone worthy of being a U.S. deficits. Why do people ignore that? crease in the standard of living of ap- Senator needs such legislation to gain When that bill was passed, our deficits proximately 36 percent. That type of political will—if they are doing their were going up and they were estimated economic information is totally ig- job properly. We are capable of spelling to be close to $300 billion a year. The nored by this New York Times edi- out just what steps we need to take, next year they went down to $250 bil- torial. and our knees will not buckle when we lion. They are estimated to be around And finally, not so much in this edi- know the truth, as was stated by one of $190 billion a year now. But the pro- torial but in others, and all the horror the Members of the House. How do I ponents of this bill make a lot out of stories that have been spread around know that? Because just 2 short years the fact that the President said, well, here about what is going to happen to ago, the Congress voted for the largest we are going to have deficits of $200 bil- social spending, what is going to hap- deficit reduction package in history. lion a year from here out into the near pen to this or what is going to happen Why so many people refuse to remem- future. to that, how do we get there? There are ber that, I do not know. two options. With passage of that single bill, the I do not like that either, but I can One is if you do not make any budget deficit was cut by over $500 bil- tell you what we ought to be concen- changes in Social Security and if inter- lion. And, I must add, we had to do it trating on. Instead of a balanced budg- est rates do not go down, and every without a single Republican vote in ei- et amendment with all of its disadvan- projection is that they will go down ther the House or the Senate. In fact, tages, we should be concentrating on but you would have some savings on in- the Vice President had to break the tie how to continue this trend of deficit re- terest because you would not have as in the Senate. duction. For the first time since Harry much of a large deficit, we would have President Clinton said 2 years ago, in Truman, we have seen consecutive to limit non-Social-Security spending both public and private conversations, years of deficit reduction. growth to 1.7 percent between now and that the most important thing is The President deserves a lot of credit the year 2002. That is doable. health of the economy. for that, and the Democratic Congress Let me put it another way. Revenue His campaign commitment on deficit deserves a lot of credit for that because in the year 2002 will be approximately reduction was not just election year we are the ones who put it through. I

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00059 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3198 CONGRESSIONAL RECORD — SENATE February 27, 1995 think we should be taking great pride ment would have to be cut by over 50 fected, how their Social Security will in that. percent—every other function of Gov- be affected, how their Medicare will be We do not need a balanced budget ernment—including health and safety affected, how their retirement will be amendment to give us guts. Political matters—every other function of Gov- affected, how their children will be af- courage should not stop at the middle ernment. And yet we are supposed to fected. They want to know up front aisle in this Chamber. It should be all vote for this and say we are going to how we intend to achieve a balanced across this Chamber. We demonstrated put a gun to our heads and say we are budget. less than 2 years ago that that is the going to force ourselves into this Mr. President, while we debate the way to cut the deficit; not by some leg- straitjacket so we will have this bal- balanced budget amendment, we are islation that is supposed to instill a anced budget amendment to hide be- seeing more headlines about tax cuts false sense of courage or a political will hind when we start cutting such pro- than about deficit reduction. Many of that we would lack otherwise. This new grams. the proponents of the amendment, who sense of courage is supposed to come Mr. President, I disagree with this should be laying out deficit-reduction from the fact that we will blame hard approach. We need to be honest. If cer- proposals, are busy preparing tax-cut choices on the balanced budget amend- tain programs are going to be on the plans. Does that sound familiar? It re- ment. table, the American people need to minds me of the very strategy that We do not have to say that we lack know they will not be sacrosanct. added more than $3.5 trillion to our na- responsibility or political will. We can But some people who say we would tional debt. Then, like today, there was do it. We know we can do it because not dare cut Social Security would— a lot of talk about balancing the budg- the Democrats in this Senate did it be- these same Senators—would not vote et but almost no talk about how to get fore. And we can be very, very proud of to exempt Social Security from the there. Instead we had feel-good budget that. balanced budget amendment here on plans. Cut taxes, smile, be happy—it is Mr. President, when we have asked the Senate floor just last week. They morning in America. for specifics during this lengthy debate would not vote to set Social Security What did we do back then? We cut on whether taxes would be raised or on aside. No, it is still on the table. So be- taxes by one-fourth over a 3-year pe- what would be cut, we have been lieve me, whether they like to say so or riod of time, 5 percent the first year, 10 stonewalled on the other side and not, your Social Security benefits are percent for each of the next 2 years. amendment after amendment after in danger because everything is still in That was supposed to result in such amendment has been voted down to play. Everything is still in play. And to economic growth we would not wind up show that they mean business over the States that are so concerned about losing money, we would wind up earn- there. They are not going to tell us unfunded mandates out there, wait ing more in revenue because of the in- how we will go about cutting programs until you look at that billions of dol- creased economic activity. or what will be threatened. They just lars you are receiving every year for It just did not work. That is what want the balanced budget amendment environmental concerns—just for envi- gave us the additional $3.8 trillion in to hide behind. ronmental concerns such as clean air debt that occurred over the 12 years be- Now, what if I would say to those and clean water. fore the Clinton administration. I take watching at home, your Social Secu- What happens to that? You can bet some Democratic responsibility for rity is going to be cut. that is going to get cut back, and so all some of that, and for this reason. Back Oh, no, no, no, the proponents of the the Governors who have been here so during the Jimmy Carter years when amendment say, we plan to take that concerned about this—and some of he was President, remember, we had 21- off the table. That is going to be off them supporting a balanced budget percent interest rates and 17-percent budget. amendment—better look to what is inflation rates for a while. Everybody Well, if that is the case, then your going to happen to their Federal fund- was scared. I was, too. I was afraid Medicare is going to be cut. Oh, no, no, ing once something like this goes what money I had was in jeopardy dur- no, they say, that is not going to be through. ing a situation like that. I think that cut. We are going to leave that off Mr. President, I believe we have had lack of control of the national econ- budget over here some place. Well, we a good debate here in the Senate on the omy is one of the things that led to the know that national defense needs to be balanced budget amendment. We did election of President Ronald Reagan. continued. It is not going to be cut sub- not push it through for the sake of Then he came in and made his big pro- stantially. In fact, the proposal is to press releases and false deadlines. We posals for supply-side economics, and increase national defense just a little did not set ourselves so many days and those went into effect, and we have bit, and I go along with that. say we have to do this or else, because seen the budget deficit going up—not Now, if you take Social Security, you we take amendments to the Constitu- only the budget deficit but the na- take Medicare, and you take defense tion very seriously in the Senate— tional debt going up ever since. off, what does that result in? I can tell very, very seriously indeed. If we do everything the proponents you, if you are going to put a balanced I believe that the debate in the Sen- say they want to do, take defense, So- budget amendment in, it means that ate has served to unearth some other cial Security, and Medicare off the every other function in the budget has very serious flaws with the balanced table, we are faced with a prospect, as to be cut by well over 30 percent— budget amendment. I wish to spell out I said earlier, of more than 30-percent every other function: AIDS research, what some of these other problems are cuts. Everything else in the Federal cancer research, you name it. besides the ones I have already men- budget would have to have about by Oh, well, we would not cut those. tioned—and to explain why I believe more than 30 percent cut. That means something else then is they make this balanced budget And as I’ve said, we are not entirely going to get cut double so you can keep amendment unacceptable. sure if that will be the case because the up with AIDS research and cancer re- Mr. President, as I stated earlier, the same proponents of the amendment search and the other programs we first step should have been to map out who say they feel Social Security would like to keep. a plan to reach a balanced budget. That should be off the table, voted against Now, what if we included a couple of is why I supported the so-called right- an amendment to exempt Social Secu- the other things I think would prob- to-know-amendment offered by the dis- rity from the balanced budget amend- ably not be voted out here. Take tax tinguished Democratic leader, Senator ment. They say the same about vet- cuts. Those are going to be put in. DASCHLE. We are now hearing there erans benefits. They say they will not Take veterans programs, veterans re- will be plans announced at a later date cut veterans programs. But then they tirement off, civilian retirement for to balance the budget by the year 2002. turn around and vote down an amend- civil service people who have retired. If Mr. President, when I talk to people ment to exempt veterans programs. So you just add those things to it, do you back home in Ohio and when I visit nobody is exactly sure where they know what we come up with? back home in Ohio, people throughout stand with this amendment. It is all We come up with the fact that every Ohio feel they have a right to know up speculation because no one is being other function in the Federal Govern- front how their lives are going to be af- told what will be cut, whether taxes

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00060 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3199 will be raised or anything else, for that and said, OK the Congress has not bal- have operated since the days of the matter. anced this budget as the Constitution Spanish-American War on basically a I submit that my constituents in requires, what shall we do? Would they 17-year cycle. It is really striking to Ohio are the taxpayers and they have a then say we will just cut certain pro- look at the figures. Almost on an exact right to know in advance what the im- grams? Or will they say one of the op- 17-year cycle we have seen buildup of 7 pact is going to be on their lives if we tions is to tax? They might give the years, followed by a 10-year reduction put the balanced budget amendment remedy. No one says they cannot do in the military: 7-year buildup, then a into effect. We can spell out for the that. How do we deal with that? Some 10-year builddown. Military spending American people how we will reduce say the Missouri versus Jenkins prece- follows that persistent trend almost the budget. We do not need a balanced dent which opened up such a possibility exactly—except for World War II, budget amendment. We on the Demo- should not be read in this way. Some where the peak was displaced by about cratic side did that in the summer of state the courts have grown less activ- 4 years. But every 17 years, we seem to 1993. President Clinton made his pro- ist and less likely to enter this sphere. decide the world is safe and that we posals that led to deficit reduction of I remind my colleagues, the Con- can cut back on our military budget. more than. We did it, and we did it stitution will last throughout future Then something always happens which without a single Republican vote from generations of Americans. The judici- makes us reconsider, and we begin the other side of the aisle. ary of the future may or may not be building up again to prepare for what- So this idea that we do not have po- activist, and it will be interpreting ever the new threat is; threats that we litical courage, we do not have guts evolving precedents that we cannot could not foresee, threats that we enough to make some of these hard de- predict. That is why I have and will could not define when we made the cisions, fall on deaf ears, as far as I am continue to support amendments to the cuts to begin with. concerned. We did it and we can do it balanced budget amendment to add Military preparedness is not some- again. What I would like to see, instead predictability to the area of judicial re- thing that just happens overnight when of these $200 billion deficits continuing view and ensure the balanced budget we suddenly see a new threat. Congress as projected, is for us to come up with amendment will not simply become a is charged in the Constitution with the real proposals for continued reduc- full employment act for lawyers. awesome responsibility of providing for tions. What we should be doing instead I am also deeply concerned about the the common defense of all of our peo- of debating a balanced budget amend- impact of the amendment during tough ple. Yet today, we are debating an ment, is try to decide how we will keep economic times. There has been a great amendment to the Constitution which that reduction going. deal of discussion on the floor about I fear may not allow Congress to live I want to see us achieve a balanced this topic by other Senators. In times up to that responsibility. There are budget by the year 2002. I think we of economic downturn, our economy trouble spots throughout the world should start moving in that direction would be placed on autopilot. The eco- that could erupt at any time. immediately—start working on it right nomic downturn would cause an unpre- What will our adversaries think if now. I intend to support an amendment dictable hemorrhage of revenues. Tax they know we have no ability to rise to offered by my distinguished colleague increases and massive spending cuts the occasion? What about our allies? I from Arkansas, Senator BUMPERS, would be forced just at the time when know that many here in Congress which will require that our congres- a fragile economy could not sustain signed the Contract With America. But sional budget resolutions from here on them. We could not do the counter- we all took an oath to support and de- map out specifically how to reach a cyclical spending that has held us out fend the Constitution of the United balanced budget by the year 2000. of more depressions since those days of Do we have courage enough to do States. That certainly takes precedent the Great Depression. And that is just over the Contract With America. that? I hope we do. Real political cour- what turned a recession into the Great age is a true alternative to the bal- Depression in the 1930’s, that lack of Mr. President, I want us to achieve a anced budget amendment. The problem ability to make countercyclical spend- balanced budget. We took an important with the balanced budget amendment ing. step toward a balanced budget 2 years is that it brings with it so many unin- The supermajority requirements of ago. We need to take the same sort of tended consequences. First, it threat- the amendment would have a minority action in this Congress. I simply do not ens the separation of powers, so care- of legislators, deciding the fate of all believe that this balanced budget fully laid out in the Constitution. Ac- Americans during these times. This amendment, as it currently is crafted, cording to former solicitor and Federal same minority would be deciding the is a wise course to follow. We have had Judge Robert Bork, the balanced budg- fate of Ohioans—or people anyplace 3 consecutive years of deficit reduc- et amendment, and I quote him, else in the country, for that matter— tion. It went from about $300 billion, ‘‘Would likely result in hundreds if not who are hit by natural disasters. Over down to a little under $250 billion, thousands of lawsuits around the coun- the years, tornadoes and floods have down to about $190 billion right now. try, many of them on inconsistent ravaged different parts of the country, What we need to do is plan to continue theories, and providing inconsistent re- as well as my own State of Ohio. The that, not just going out with $200 bil- sults.’’ Federal Government always came to lion into the indefinite future, as the In fact, the judicial consequences of our aid. With this amendment in place, President’s budget has proposed. the proposed amendment have brought legislators who have never been to Mr. President, I come back again to together an unexpected alliance of Ohio nor visited other areas impacted where I started my remarks; that is, to legal scholars who oppose the amend- by disasters, would suddenly have veto ask: Why do we need this amendment ment. Conservatives such as Bork and power over Government compassion. to our Constitution? We are told by the Robert Fried and liberals such as Ar- Tough luck, you are on your own. other side that we need it for political chibald Cox and Laurence Tribe all That is why I support an amendment courage, we need it for political will, think it is a serious mistake. offered by my friend from California, we need it for discipline. We dem- I fear activist Federal judges, trying Senator BOXER, to provide flexibility in onstrated political courage, political to enforce the balanced budget amend- cases of natural disaster. will, and discipline less than 2 years ment, would place themselves in the Another area of very great concern ago in this very Chamber when we role of elected officials. These judges, to me also is that of national defense. voted a $500 billion budget deficit re- appointed for life and insulated from The amendment has a military con- duction package. That was a tough the people, could usurp the power to flict waiver which is extremely impor- package. Putting it together involved tax and spend from elected officials. I tant but it certainly does not go far many tough votes. We did it upfront in believe our Founding Fathers, who enough. What happens if America faces a responsible manner. We were honest. fought a revolution against taxation a military threat, not a conflict? Will People knew exactly what we were vot- without representation, would be we be able to gear our forces up in ing on. We were accountable to the shocked at that potential prospect. If time? If you look back over our mili- people we represent. We went home and the judiciary had a case before them tary history at military spending, we explained why we voted the way we

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00061 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3200 CONGRESSIONAL RECORD — SENATE February 27, 1995 did. We did not hide behind some bal- proposed by Senator Harry F. Byrd and for nontrust fund budget items in excess of anced budget amendment that gives me, the American taxpayers could have revenues received from all nontrust sources, cover for those hard votes. been saved more than $3.2 trillion in in- (2) such fiscal policy by the Federal Gov- I think the way to go is to repeat terest alone. ernment has resulted in substantial bor- what we did less than 2 years ago on The American people have difficulty rowing from both public and private sources, this floor, and lay out a plan of how we comprehending the enormity of a tril- (3) the aggregate of such borrowing has re- will continue the deficit reduction pro- sulted in an exorbitant national debt total- lion dollars. I went into the cloakroom ing more than $450,000,000,000, gram that President Clinton first pre- the other day, and several Senators (4) this debt will continue to increase so sented, and we enacted into law. It has were sitting around. I said, ‘‘How many long as the Federal Government spends more been effective; it has worked. million are in a trillion?’’ One said than it receives, Mr. President, I yield the floor. ‘‘100,000.’’ Another one said, ‘‘I do not (5) the Federal Government is now paying Several Senators addressed the know.’’ And a third one said, ‘‘Don’t annual interest on the national debt in ex- Chair. give us that. What is it?″ cess of $20,000,000,000, and The PRESIDING OFFICER. The Sen- I said, ‘‘There are 1 million millions (6) this interest payment is annually in- ator from North Carolina. in a trillion.’’ Bear in mind that the creasing as a fixed expenditure in the Fed- Mr. HELMS. I thank the Chair. U.S. Government—meaning the tax- eral budget. It’s is no exaggeration to suggest Mr. (b) The Congress further determines that— President, the Senate is about to make payers of this country—owes $4.8 tril- lion. That dead cat lies at the doorstep (1) deficit spending by the Federal Govern- one of the most momentous decisions ment has resulted in inflation in the Na- in the history of the Nation—on the of the U.S. Senate and the House of tion’s economy and a lessening in the value question of whether to add a balanced Representatives. We cannot get around of the dollar in terms of its ability to pur- budget amendment to the Constitu- it. No President can spend a dime that chase goods and services in foreign and do- tion. is not first authorized and appropriated mestic markets, On the eve of this significant vote, it by the Congress of the United States. (2) unless this deficit spending on the part is instructive to consider the counsel of If I may return for a moment to one of the Federal Government is discontinued a our Founding Fathers on this matter. of my American heroes, Mr. Jefferson, severe economic depression will result. Thomas Jefferson said in 1816 that ‘‘To he also said that ‘‘The question wheth- (c) The purpose of this Act is to require the President to submit to the Congress a budget preserve our independence, we must er one generation has the right to bind another by the deficit it imposes is a in which nontrust fund expenditures do not not let our rulers load us with per- exceed revenues received by the Government petual debt. We must make our elec- question of such consequence as to from nontrust sources. tion between economy and liberty, or place it among the fundamental prin- SEC. 2. The nontrust fund expenditures of profusion and servitude.’’ ciples of government. We should con- the Government of the United States during Mr. Jefferson thereby laid out the sider ourselves unauthorized to saddle each fiscal year shall not exceed its revenues choice before the Senate—liberty or posterity with our debts, and morally from all nontrust sources for such year. servitude. Congress, having become bound to pay them ourselves.’’ SEC. 3. (a) The President shall submit a enslaved to deficit spending, has re- Amen, Thomas Jefferson. budget pursuant to the Budget and Account- fused for decades to stop the practice of That just about tells it all, certainly ing Act of 1921, as amended, in which spending money it does not have. in terms of the moral injustice that we nontrust fund expenditures do not exceed nontrust fund revenues for each fiscal year. How enormous is the Federal debt? have been heaping upon our children and their children and their children. (b) The provisions of this section may be For nearly 3 years, Mr. President, I adjusted to reflect any additional revenues have made a daily report to the Senate Nobody suggests that balancing the of the Government received during a fiscal regarding the Federal debt—down to budget will be easy. It will be tough. It year resulting from tax legislation enacted the penny as of the close of business really boils down to a matter of doing after the submission of the budget for such the preceding day. As of close of busi- what we were elected to do, and that is fiscal year. ness this past Friday, February 24, the leveling with the people of this coun- SEC. 4. This Act shall apply only in respect debt stood at $4,838,340,250,340.71. On a try. of fiscal years beginning after June 30, 1974. per capita basis, every man, woman, I can debate for hours the contention Mr. HELMS. Mr. President, I yield and child in America owes $18,366.42. that accepting a balanced budget the floor. The taxpayers had to fork over $203 amendment is not constitutional. How- Mr. DORGAN addressed the Chair. billion in 1994 just to pay the interest ever, statements like that do not make The PRESIDING OFFICER (Mr. on this massive debt, and that, on a per sense. I do not denigrate anybody who FRIST). The Senator from North Da- capita basis, amounts to $1,138.76 for uses their best argument to try to de- kota. every American man, woman, and feat something that I happen to believe Mr. DORGAN. Mr. President, it is not child. in. usual to hear the Senator from North One looks back in time to see where There was another eloquent Presi- Carolina quote Franklin Delano Roo- we stood. dent, by the way, who spoke one time sevelt, but I appreciated listening to Mr. President, when I was sworn in as of a rendezvous with destiny. What des- his presentation and, as always, his a Senator in January 1973, I was dis- tiny will the U.S. Senate choose tomor- presentation is interesting and heart- tressed that long ago, that Congress row? What legacy will we vote tomor- felt. had been spending far more than it row for generations yet to come? The issue that we debate today in the took in—year after year. Deficit spend- Mr. President, I ask unanimous con- Congress is not an ordinary issue or ing had become a way of legislative sent that the text of S. 2215, the bal- one of passing interest. It is about life. anced budget bill offered by the then changing the U.S. Constitution. I know So on July 19, 1973, I offered S. 2215, Senator Harry Byrd, Jr., and myself, there are some people who serve in this a bill to require a balanced budget. It on July 1973 be printed in the RECORD. was cosponsored by the then distin- There being no objection, the mate- body who support a menu of changes to guished Senator Harry F. Byrd. On rial was ordered to be printed in the the Constitution. You name it, they support it. The Senator from Arkansas that day, July 19, 1973—if you can be- RECORD, as follows: said the other day—and I have not lieve this—the Federal debt stood at a S. 2215 relatively small figure of counted them—there has been nearly Be it enacted by the Senate and House of Rep- $455,570,163,323.85. Today, 22 years later, one proposal to change the Constitu- resentatives of the United States of America in tion every day that we have been in the Federal debt has skyrocketed to Congress assembled, That this Act may be $4.3 trillion. The historical tables of cited as the ‘‘Emergency Anti-Inflation Act session since the first of the year, and the 1996 budget reveal that the interest of 1973’’. 11,000 proposals have been offered to on the money borrowed by Congress FINDINGS AND PURPOSE change the Constitution since the Con- stitution was written. since 1973, cost the taxpayers SECTION 1. (a) The Congress of the United $3,209,417,000,000. States hereby determines that— I have described on this floor before a Imagine if Congress had passed a bal- (1) the Federal Government is now and has day in my life that I shall always re- anced budget amendment in 1973 as been expending funds during the fiscal yer member. I was one of 55 persons to go

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00062 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3201 back to an assembly room in Constitu- grew up in a small town, went to a running double and triple the rate of tion Hall and celebrate the 200th birth- small school and studied George Wash- inflation and there is never a vote on day of the writing of the Constitution. ington, and here I was in this chamber that, just to use health care as an ex- Two-hundred years previous, fifty-five where George Washington’s chair was ample. That is on automatic pilot and white, largely overweight men, sat in at the front of the room—the very it increases and increases and in- that room in Philadelphia. We know chair he sat in while presiding over the creases. that because we know who was there. Constitutional Convention; it was still And so the point of it is, it is not a We know the stories about how they in the front of this room. Franklin sat case where there are 100 people voting had to keep the shades drawn during over there, and Madison, Mason. It was to say, ‘‘Yes, let’s increase that.’’ It is that hot Philadelphia summer in that a wonderful experience to sit in that an entitlement program that is now room, because it got very warm while room. It kind of gave you goose bumps latched to inflation and whose costs they were trying to craft a Constitu- to understand the history that was cre- move up every single year. tion. There were some of the most bril- ated there—the crafting of a document Revenue does not do the same. In liant minds in the history of this coun- called the Constitution, which has rep- fact, the income tax system and the try convening there. Absent, of course, resented the framework of self-govern- personal exemption, for example, is in- was Thomas Jefferson, who was in Eu- ment in the most successful way in re- dexed exactly the other way. As infla- rope at the time. But he contributed corded human history. There is no tion increases, you then increase the nonetheless substantially to the Bill of record of a society that has practiced personal exemption, so there is not an Rights and especially to the writing of self-government as successfully as has automatic increase in revenue. So you the first amendment’s free speech this country. have an automatic increase in the cost clause. So I think now about sitting in that of entitlements because of inflation be- As I said, there are some who seem to room and I think about the people who cause they are hooked to it and accel- want to support virtually every pro- must have sat there 200 years ago as erate, and the revenue system is posed change to the Constitution, like they tried to understand what kind of a hooked just the opposite way so that it human weather vanes spinning in the framework would work. What kind of will not increase automatically. And winds of the public passion of the mo- fabric would reach over a couple of cen- we have created then this mismatch in ment. Others are opposed to changing turies and more—maybe a couple of policy and it just cannot exist; it can- the Constitution under any case, ever. more centuries—and allow for our sys- not continue to exist. The Founding Fathers who wrote the tem of government to work? And one I think all of us in this Chamber un- Constitution actually provided for a must admit that even with 11,000 dif- derstand we have a circumstance in process to make changes to it. Still, ferent proposals to change the Con- this country where we routinely have they made it very difficult, and stitution, those who wrote it originally higher expenditures than we have rev- changes have been made only on very did a masterful job. It is an extraor- enue. And what happens to the dif- rare occasions. We are trying to decide dinary document in the history of civ- ference? Well, we simply charge it. We today and tomorrow whether this ilization. issue more bonds and the children then should be one of those occasions. As I have said, it works because in are faced with more and more debt. I am not someone who believes that people’s minds and hearts there rep- The deficit at this point is roughly we should reject change in every cir- resents an acceptance that self-govern- $180 billion. But that is not the honest cumstance. But I am, I suppose, a con- ment is something they agree with and deficit. The honest deficit at this point servative, if you can forgive the use of believe in and think represents the best would be the $180 billion, plus the $70 the word in this Chamber, because it is hope for this country to make progress. billion in Social Security surplus this confusing to try to understand these We are now, as all of us understand, year. That is used to reduce the $250 days who conservatives and liberals facing a difficult set of circumstances billion back to $180 billion. The real really are. I am conservative when it in our country. We face, I think, a debt deficit is about $250 billion. comes to changing the Constitution. I crisis of sorts. It is a debt crisis with That is the way the accounting sys- believe it ought to be done only on rare respect to fiscal policy—that is, the tem works, unfortunately. It should occasions and only in circumstances of Government spends more money than not work that way. We need to try to extraordinary need. Harold Wilson once it takes in, and a debt crisis, addition- address that. talked about the only human institu- ally, in our trade policy. This year was We have a Social Security system tion which rejects progress or change is the largest trade deficit in the history that is now raising more money than it the cemetery. Change is a part of our of this country, or any country, for expends. The reason we have that is be- lives. Yes, indeed, even change in the that matter. cause Congress decided in 1983 that we Constitution may be part of our lives How did we come to that point and were going to face a crisis in Social Se- when it is necessary. what causes all of this? It is inter- curity at some point and we had to Each of us, as other speakers have in- esting if you listen to some of the po- start saving for it. dicated, takes an oath when we come litical dialog. And this is done delib- In 1983, I was serving on the House to the Senate to serve, and that oath is erately, and I understand that. It is, Ways and Means Committee. We had to to uphold the Constitution. I do not gee, you know something, the Members write the Social Security reform bill. A think anyone takes that oath lightly. of Congress come to take their seat in lot of people do not understand the All of us understand the circumstances the U.S. Senate Chamber and the first magnitude of that bill. It increased and the meaning of that oath. All of us thing they want to do is cast another FICA taxes for both the employee and understand, as well, that it is not just vote to spend more money. But all of the employer. Certainly, all of them public passion that should persuade us understand what happens. The rea- understand that. It even stretched out this body or the House to decide to son we spend more money this year the retirement age from 65 to 67. I bet change the Constitution. Our system of than last year is that there is an auto- a lot of people do not know that is in Government, I think, has worked for matic pilot on entitlements, and this the law. But it begins after the turn of over 200 years because people have had year we will spend much, much more the century. It is phased in very gradu- faith in this system. on health care than last year. ally. When I sat there in that room, 200 Why? For two reasons. But this Social Security reform years after the writing of the Constitu- In Medicaid, more people are poorer package made a lot of changes. One in- tion, 55 of us went back in to recreate and the health costs are going up. In tent of that package was to try to re- the event on its 200th birthday. As I in- Medicare, more people are reaching quire a savings each year in order to dicated, it was written by 55 white Medicare age, more people are trig- meet the need when the baby boomers men. So 55 of us—men, women, and mi- gering that eligibility, and health care retired after the turn of the century, norities—went back into that room, costs are going up. Therefore, we spent when the largest baby crop in Amer- and in a very solemn ceremony, cele- a lot more on health care this year ican history hits retirement. Then we brated the 200th anniversary of the than we did last year because health have serious financial problems with writing of this wonderful document. I care costs in many cases have been Social Security.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00063 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3202 CONGRESSIONAL RECORD — SENATE February 27, 1995 So the approach to reform that and lowing on the heels of 2 years ago when virtually everyone subscribes to and respond to it was to say, ‘‘Let us have we passed the Deficit Reduction Act, believes in. each year a forced savings in the Social and understanding that we did not pass So we had a vote on this constitu- Security system.’’ And this year, inci- health care reform and understanding tional amendment, on an amendment dentally, it is about $69 billion. We will that health care costs keep going up, offered by Senator REID, that said, ‘‘All take in $69 billion more in the Social not just up a bit but way up in the long right. Let’s change this so that the def- Security system in revenue than we term, the question is how do you then inition of expenditures and receipts in will spend out. Therefore, the surplus respond to an even greater challenge in the constitutional amendment to bal- this one year will be nearly $70 billion. the outyears? Do you continue to have ance the budget does not include ex- Why are we doing that? Again, to increasing Federal deficits now in the penditures and receipts of the Social save it for after the turn of the century outyears, because we have not been Security System.’’ when we are going to need it. able to control health care costs? Or do The reason? Because if you include Now, is it being saved? No; I mean, we find a way to do something about expenditures and receipts of the Social technically there is a bond that goes in that? Security System—a system which, in- the trust fund but, as all of us under- Some say, ‘‘Well, let’s change the cidentally, is going to run very large stand, the money is still used and it is Constitution. Let’s put in the Constitu- surpluses in the coming years that we customarily referred to as a pool of tion a requirement that in 7 years, we are going to need to save—if you do money that reduces what we call the balance the budget.’’ that, what you do is you create a cir- Federal deficit. The Social Security I am willing to consider that. I have cumstance by design that says we will revenues are used as an offset to reduce voted for a constitutional amendment balance the budget by using the Social the operating budget deficit of the Fed- in the past. I hope I will vote for one in Security trust funds to do so. eral Government. the future, and I may vote for this one, Well, you know, you would have to And the fact is that we cannot con- depending on a couple of caveats. I am keep faith with one or the other, but tinue to do that. That breaks the going to raise those questions today, as you cannot keep faith with both. Ei- promise with the workers. It breaks I have raised them earlier today with ther we say to the senior citizens and the promise with the senior citizens. those who have been the principal au- the workers who contribute the money Either we are going to save the money thors of this legislation. that goes into this trust fund that this or we are not going to save the money. The question is not whether we do is saved and we pledge that it is a dedi- But let us not have a charade in which something. The question is how we do cated tax put in a trust fund to be used we say we are going to tax you to raise something about this debt crisis. Do we only for one purpose, or we do not. more money than we need to spend at pass a constitutional amendment to Then you say: Well, we are collecting this point and we promise to save it, balance the budget? If we do, what kind this dedicated tax. Yes, it is regressive. but we really will not because it will be of amendment will we pass? Yes, we agreed to do it for Social Secu- used to offset spending. Will we, after we consider a constitu- rity, but we have changed our minds. It Well, I think that there is general tional amendment to balance the budg- is now going to be part of the operating agreement by Members in this Cham- et and vote on it, if we enact it, restore budget deficit and it will be used to ber that we have a debt crisis, a real some thread of confidence with the lower the general operating budget def- problem. And what do we do about it? American people? icit of the United States. One of the We just heard the speaker before the No, we will not have done anything, two will be the case. last, Senator GLENN from Ohio. He ac- not even one penny’s worth of progress The question the Senate has to an- curately portrayed 2 years ago, when to responding to the debt issue, by swer is which one of those two? We are we had a very significant budget debate passing the constitutional amendment. told, ‘‘Well, we really cannot do much and we were asked to vote on a budget No one here would stand, in my judg- about that at this point. Maybe that bill that cut the deficit over 5 years by ment, and allege that doing anything could be accomplished in implementing $500 billion, we had to find all the votes to deal with the deficit is going to be a legislation in which we describe what for it on this side of the aisle. Not even part of this constitutional amendment. expenditures and receipts mean.’’ one vote—one would expect somebody The fact is, the amendment is simply If that is possible, and it may be pos- would vote wrong accidentally from words that will be a part of the con- sible that we describe what expendi- time to time; you know, just not quite stitution. Now, that is important, very tures and receipts mean in the imple- understand it. You expect to get one important. But, in and of itself, it does menting legislation and they do not vote from the other side just as a re- nothing to advance even one penny’s mean Social Security receipts and ex- sult of an accident. But we could not worth towards reducing the deficit. penditures, then that will solve the even get one vote. That will have to be accomplished by a problem, in my judgment. That can be So we had to figure out how we could series of other steps, including taxing done by passing that portion of the im- come up with a plan that cut the budg- and spending decisions that the Con- plementing legislation prior to the et deficit by $500 billion. Some of it was gress will have to confront. It can con- vote tomorrow on the constitutional not very popular. But I was perfectly front them with or without a constitu- amendment to balance the budget. happy to do that because that is our tional amendment. There is a way for that to be accom- job. We are required to do that. We The question is, what would provide plished. If that is accomplished, that ought to do a lot more of it. And we did the greatest likelihood to advance to- will resolve my concerns with respect it. So we passed this Budget Deficit Re- ward the solution to this debt problem? to the use of the Social Security reve- duction Act and the deficit has gone And let me ask a couple of questions nues because the Senate will have spo- down. that I have asked rhetorically today of ken on that issue. But the Senate has I mean, the deficit was around $270 those who are the principal sponsors. to make a decision: Is it going to allow billion. It has gone down about $90 bil- The first has to do with Social Secu- in this amendment the use of the So- lion or so. Actually, the real deficit is rity. I know that we are told that the cial Security reserves or surpluses to $250 billion. And, you know, if you take Social Security System is a system balance the operating budget deficit, or the Social Security out, it was over that is important to everyone in this is it going to use them to save for the $300 billion. Now it is down to about Chamber, and everyone believes that future? $250 billion. we ought to protect and preserve the It is not going to be both. It will be But the point is, the deficit reduction system. We continue to hear that time one or the other. We have already had package reduced the Federal deficit, and time again. one occasion in which the implication but people did not like it very well be- We also hear virtually everyone say was that we would use the Social Secu- cause the medicine is not medicine that the design to collect more money rity surpluses or trust funds to balance that tastes very good. It is bitter-tast- now for the Social Security System the operating budget deficit. If that is ing medicine. and have an enforced surplus to be the case, that is not satisfactory to me. So we have come here today with an- saved until after the turn of the cen- If, on the other hand, we are willing other set of challenges and that is, fol- tury when we need it is a design that to say in implementing legislation,

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00064 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3203 prior to the vote tomorrow, that ex- We are told it is hard to sift through lion tax cut. And we want more defense penditures and receipts from the Social all of this. It is hard because of proce- spending, and we also, by the way, Security System are not included in dural circumstances. We are told that want to resurrect Star Wars at the the constitutional amendment as ex- it is difficult to do these things. Look, same time.’’ penditures and receipts, as a matter of when we are passing a change in the I have no idea where these arithmetic definition, then that resolves the prob- U.S. Constitution, this Senate should books come from, but they did not use lem, at least from my standpoint. work its will to make sure that that them in my home school. I hope, as we So the question whether that is re- change is exactly the kind of change work through all of this agenda, that solved is not up to me. The question of we want and the country needs. we will come to a more focused agenda; whether that is resolved is a matter of The last thing I want to do is make that is, a determination by all Mem- intent with respect to those who offer a mistake in amending the U.S. Con- bers, to head towards the same com- the amendment and whether we can, stitution, because that is a mistake mon goal: Relieve this country of a through amendment tomorrow, by that cannot easily be corrected. This is debt crisis that is getting worse, see if passing part of the implementing legis- not, in my judgment, bumper sticker we can move towards a balanced budg- lation, deal with that issue. politics or sloganeering. It is deadly se- et, and try to do the right thing for Let me mention the second issue that rious business when we are talking this country’s future. has been well discussed, and that is the about changing the basic Constitution I am willing to take risks. And I issue of enforcement. Senator NUNN of this country. think we should be willing to take has raised, and I think appropriately I have said before and I will say risks these days to try to respond to so, the question of how will the con- again, I think the debt crisis in this this problem; if not for us, then cer- stitutional amendment be enforced? country is sufficiently serious to war- tainly for our children. But I am not Are we creating a constitutional rant this serious discussion about willing to cast a vote for a constitu- amendment on fiscal policy and asking changing the Constitution, and I would tional amendment unless it is the right the courts to be involved in taxing and be a part of those who are willing to constitutional amendment, and I am spending decisions, if, in fact, the Con- change the Constitution if the two hoping that, in the coming day or so, a gress does not respond appropriately to issues I have mentioned are resolved. If couple of the problems that we have what the Constitution requires? they are not resolved, I will not be a had discussed at length discussions can If the answer to that is, yes, we will part of that change. The decision is not be addressed. If that is the case, I will have the courts enforce the constitu- a decision I will make. The decision is vote for the constitutional amendment. tional provision on the balanced budg- a decision that will be made by those If it is not the case, then those who et, then I think there is serious con- who are crafting this and whether they have written this proposal will end up cern by a number of other Senators. will allow the will of the Senate to be short of votes to pass this proposal. This can be resolved easily, and it can expressed on this issue of the use of $3 Mr. President, I will be on the floor be resolved quickly. It can be resolved to $4 trillion of Social Security funds again tomorrow, and I assume we will by precisely the addition of the amend- and on the issue of enforcement. have additional discussions. I say again ment that was accepted last year ago Some say, ‘‘Well, you voted for the that the decision of whether this con- when we debated this. balanced budget amendment pre- stitutional amendment to balance the Senator Danforth offered and the viously.’’ Yes, I have. It was different budget is enacted by the Senate is a de- Senate accepted the provision on en- in the sense that it contained the en- cision that will be made by those who forcement that deals with the declara- forcement provision provided by Sen- advance it, and whether or not they tory judgment capability. That is ex- ator Danforth. This does not. If they do will allow the Senate to work its will actly the way to solve this. Senator that, it will make me more com- on these two questions, from my stand- NUNN has raised the issue. Others have. fortable. point, the use of the Social Security re- I say from my standpoint, we really And one other thing has changed that serves and trust funds and, also, the ought to respond to this issue in a is fundamental. We now have some- question of enforcement. forthright way. I think it can be re- thing called a Contract With America Mr. President, I yield the floor. sponded to in a forthright way. If that which proposes at the same time that Mr. GORTON addressed the Chair. is the case, if that is dealt with, then, we face a serious debt crisis in our The PRESIDING OFFICER. The Sen- once again, I raise no objections about country, a massive tax cut, inge- ator from Washington. that issue. niously, in the mind of some, concocted Mr. GORTON. Mr. President, I have I would like very much to see Con- so that a smaller part of it occurs in listened with great interest to the re- gress advance a solution to this debt the first 5 years of budget scoring and marks of the distinguished Senator crisis. That solution may very well be a much larger portion occurs in the from North Dakota who, it seems to a constitutional amendment to balance second 5 years, a tax-cut proposal that me, has made three points or sets of the budget. But I would not be com- will reduce revenues in 10 years by reservations about the balanced budget fortable supporting a constitutional some $3 to $4 trillion, it is estimated. amendment rather than two. amendment to balance the budget if I think it is very difficult to have a One is the failure to exempt Social riding on that vote was $3/4 trillion of serious discussion about a tax cut at a Security from all calculations under Social Security revenue used in the fu- time when we are also having a serious the amendment; the second is the ab- ture to offset operating budget expend- discussion about changing the Con- sence of any provision in the amend- itures in order to show a lower deficit stitution because this country has a ment that will prevent the courts of for the Federal Government but which, debt crisis. In my own view, the job of the United States from arrogating to at the same time, would mean we the U.S. Senate is to find a way to cut themselves the right to write balanced would not have saved in the Social Se- spending. And, yes, we ought to be budgets; and third is the impact on at- curity system that which we promised tough and cut spending and cut spend- tempting to balance the budgets of var- to save. ing, and use the money to cut the def- ious proposals in the House of Rep- It seems to me that the fate of this icit. resentatives for reductions in taxes. constitutional amendment to balance Now, there is a judicious way to cut I say with all the sincerity at my the budget will be determined tomor- spending and another way to cut spend- command with respect to those con- row by a judgment made by those who ing. You do not have to do it with a cerns of the Senator that two of the offer the amendment on how they re- meat ax, and you can do it with some three, it seems to me, rather argue in solve, at least from my standpoint, judgment and some discipline. I confess favor of supporting this constitutional those two questions. What is the will of that I am confused by those who are amendment than they do against it. the Senate with respect to the use of the loudest voices for changing the The third is, as I believe the Senator $3/4 trillion of Social Security funds? Constitution so that we would require from North Dakota knows, a concern Are those trust funds going to be used a balanced budget, and who on the which I share and share deeply. to balance the operating budget deficit, other side of their coverall pockets are Let me take the first two points or are they going to be saved? saying, ‘‘We also want a $3 to $4 tril- first. The first question that arises

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00065 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3204 CONGRESSIONAL RECORD — SENATE February 27, 1995 with respect to Social Security is, is is: A terrible threat to the country, a perhaps possible—that that kind of the Social Security System protected threat which Congress and Presidents change may be made in this constitu- in some way by a defeat of this con- have been unable or unwilling to meet tional amendment. I am delighted with stitutional amendment in a way that it in the past, and dealing with it through the thoughtful attitude toward it by is not by its passage? Well, Mr. Presi- a constitutional amendment which re- the Senator from North Dakota. dent, the answer to that question is quires all parties, everyone in the That is a proposal which, in my clearly no. In fact, I am convinced that country, but most particularly future mind, would strengthen this constitu- the Social Security System of this Presidents and future Members of Con- tional amendment. The other proposal country will be stronger and more se- gress to be a part of the solution rather would weaken it and would weaken the cure with the passage of this constitu- than a part of the problem. Social Security System at the same tional amendment in its present form The difficulty, of course, is that So- time. than it will be either without a con- cial Security receipts and disburse- Now, having listened to the last hour stitutional amendment at all or, alter- ments are receipts and disbursements or so of debate on this floor, I am re- natively, with a specific exemption in of the United States. The payroll tax is minded of the set of categories with the constitutional amendment itself. a tax. Disbursements are disburse- which I was impressed on the very first It is clear that the Senator from ments. Markets, the economy of the day of the debate on this constitu- North Dakota, who is genuinely ago- United States, are not fooled by saying tional amendment; and that is that nized by the choice in front of him, that money goes into and comes out of Members of this body are divided into does wish that we balance our budget, one pocket rather than another. If we three groups with respect to the budget does feel that the present system has are to balance the budget, we must bal- of the United States. failed to do so. And yet with each year ance it with all receipts and all expend- There is clearly a group of liberal that passes under the present system, itures, and those who are recipients of Members, that does not include the the pressure on Social Security and, Social Security will be best off if we Senator from North Dakota, that sim- for that matter, on all other vital recognize that fact because if we fail to ply does not believe in a balanced forms of spending in the United States, do so, they will be threatened along budget at all, who like the status quo, increases by reason of the failure of with everyone else. who favor the present system, who be- this and other administrations and the On a second subject, Mr. President, I lieve that deficits are not harmful to Congress to deal with problems of the had not previously heard that one of economic growth or to the prosperity deficit. the arguments against this constitu- of the people of the United States of No one can feel that early in the next tional amendment is a set of proposals America. century when this country, if we make in the House of Representatives with Those Members are and should be op- no changes in the way in which we op- respect to tax cuts. The President of posed to a constitutional amendment erate, will literally have no money left the United States himself in his budget which makes an unbalanced budget a for anything other than a handful of submission has proposed tax reductions much more difficult task to undertake entitlements, no person can feel that somewhat more modest than those in than it is at the present time. under those circumstances Social Se- the so-called Contract With America, curity will not be changed. It will, and probably less effective in rebuilding There is, in addition, Mr. President, a it will be changed to the detriment of our economy and opportunity for eco- second group, a group represented at the recipients of Social Security retire- nomic growth in the United States. least in the original instance by the re- ment income. But again, with respect to a more lib- marks of the distinguished senior Sen- Bringing our fiscal house in order, eral Member on the other side of the ator from Ohio about 1 hour ago, who therefore, protects rather than threat- aisle who opposes the tax reductions tell us that they believe deeply and ens the Social Security System. And if, contained in the Contract With Amer- passionately in a balanced budget but as I believe and the Senator from ica, it would seem to me that the exist- that we ought to do it ourselves; that North Dakota believes, that we are not ence of those promises would be rather we should not engage in a change in going to bring our house in order un- an argument in favor of this constitu- the Constitution; that it is simply a less we establish some kind of external tional amendment than an argument matter of discipline. discipline, why then, Mr. President, the against it, since it is obvious that a re- Then there is the third and largest passage of this amendment in its quirement that the budget be balanced group—whether it includes 67 Members present form is a protection for Social by the year 2002, as a matter of con- or not will be determined about 24 Security rather than a threat to it. stitutional law, will require all Mem- hours from right now—a third and larg- An addition to this amendment of a bers of Congress—those who favor tax er group which believes that the specific exemption for Social Security, reductions and those who do not—to present system is broken, that a bal- I think, perhaps threatens the system look much more carefully at the budg- anced budget is desirable—in fact it is even more because it will provide, by et implications of each and every ac- imperative if we are to do our duty to such a huge exception to the require- tion, whether that action refers to generations yet to come—which in ment for a balanced budget, an over- spending or to taxing policies. many cases has tried varying formulae whelming temptation directed at fu- The third point made by the Senator for bringing the budget into balance ture Congresses to redefine what is in from North Dakota, on the other hand, without a change in the fundamental Social Security, to include in the sys- is one with which this Senator agrees. system itself and observe simply as a tem all kinds of benefits which will go This Senator was one of several on this result of our history that it has not to the same classes of people who ben- side of the aisle who voted in favor of worked; that the system is broken; efit from Social Security today that an amendment proposed by the distin- that we need a radical change, a new are not now defined as Social Security guished senior Senator from Louisiana direction; and that that new direction or, alternatively, in order to balance a week or so ago to make clear that is represented by the amendment to the budget, a reduction in the Social the responsibility for budget decisions, the Constitution which is before us Security payroll tax and, therefore, in after the passage of this amendment, right now. present surpluses in that system and a rests exactly where it does now: With The difficulty with opposition to this transfer of that taxing authority to the the President and with the Congress of amendment, in my view, Mr. President, general fund in order to balance the the United States, subject to the heavy is just this. The first and second cat- budget. discipline this amendment requires. egories tend to have a fuzzy distinction So an exemption of Social Security I do not wish courts substituting between them, tend to meld into one written into the Constitution will not their judgment for the judgment of another. The distinguished Senator protect the system. A rejection of the those who are elected by the people of from Ohio began his speech by demand- constitutional amendment will not the United States to make these vital ing a discipline on the part of Members protect the system. The system will, I and important decisions for the people of the Congress: do the job ourselves, am convinced, be protected best by of the country by any stretch of the do what we were sent here to do, do not treating the budget deficit for what it imagination. And I hope—I think it is ask for constitutional changes in order

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00066 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3205 to do it. Then he launched into a criti- the Constitution of the United States, general of his State. He knows the le- cism of all of the possible ways of re- there will be a huge penalty for such a galities and the importance of doing ducing spending so that the budget course of action. Presidents and Mem- this as a constitutional amendment. I might be balanced. He seemed to move, bers of Congress will be required to am very pleased he is one of the leaders in other words, from category 2 into come up with budgets that either re- in this effort. category 1. We should discipline our- duce spending or increase taxes or I would just like to say it is the most selves; we should balance the budget on both. And if at some time there is a re- important vote that I will cast in my our own hook; but it would be a ter- turn to the majority of those who be- public life. That is how important the rible threat to deal with any of the lieve in higher taxes—a group clearly vote tomorrow is, in my opinion, for really expensive spending programs not in the majority today—they will be our future generations of this country. which in total result in our having a able to do so. There is nothing in this So I do think we need to focus on the budget that is unbalanced. constitutional amendment that pre- basic issues. It is in that second category, it vents balancing the budget on the The first one is why? Why do we need seems to me now, that the President of backs of taxpayers of the United this to be a constitutional amendment? the United States falls. We have heard States. There is a clear majority in The national debt is a cancer on this a great deal about the fiscal discipline this body right now who will not do so. country and we are passing it to our and the political courage that was in- But if an election campaign is run suc- children and grandchildren. It is now volved in passing the budget here just cessfully on the proposition that we over $4 trillion; $17,600 for every man, 2 years ago which significantly in- need higher taxes, a Congress which woman, and child in this country. For creased taxes without significantly re- wins on that platform will be able to do a family of four this is over $70,000 in ducing spending and resulted in, or was so. By the same token, those who be- debt. If a family of four has a $70,000 coincident with at the time of rising lieve that spending needs to be cut will debt, that is a big responsibility. That economic growth, a relatively modest be under the gun; they will be required is a burden on the shoulders of that decline in the budget deficit. to produce; and the President will be family. You have to pay it out over However, that budget year is over, required to come up with some kind of time and it is not easy. In fact, every and we now have a proposal from the proposal or another, better and more family of four in this country has the President that never, even under very responsible than the proposal that we $70,000 debt that we will only be able to rosy economic growth projections, re- received from this President this year. erase if we pass this amendment to- sults in a budget deficit of signifi- The dynamics of this constitutional morrow. It is soaking up capital that cantly less than $200 billion a year as amendment, Mr. President, are simply we need for investment in our busi- far as the eye can see—5 years, 10 this: Everyone in elected office will nesses, and it is 26 percent of our budg- years, beyond that period of time— have to be a part of the solution. Ev- et that we are paying in interest. which suggests some modest tax reduc- eryone will have to be a part of the That money could be going into in- tions and even more modest spending game rather than allowing the chal- vestment capital for investment in reductions. It overwhelmingly lacks lenge simply to be kicked down the equipment that would create jobs, that courage, a status quo budget, and it is road, left to the next administration, would help our economy and would perhaps the best single illustration of to the next Congress, to the next group help the people of our country get back why we must pass this constitutional of people who come here. to work. But instead, that money is amendment. How much better off we would be had just going to pay interest on the na- When a President, who made deficit a proposal such as this been passed tional debt. reduction the heart of his message dur- some years ago, but if we have learned It has been getting worse just in the ing his first year as President, aban- anything in the course of the last dec- last few years. Since 1975, 20 years ago, dons that goal totally, lock, stock, and ade or decade and a half, it is that the our per capita debt has increased more barrel, by the third year of his Presi- most sincere statutory solutions, like than sevenfold. So it is something that dency, it is clear we need to change the Gramm-Rudman, do not work because is getting worse, not better. In fact, system under which we operate. they get abandoned as soon as the shoe the per capita debt has increased $900 Of course, it is exactly that change begins to pinch. just since we started debating this which is proposed in this constitu- There is, in my view, no solution to amendment earlier this month. It is tional amendment. The dynamics of its the fiscal problems facing this coun- $900. You have seen the charts. It just passage and its ratification by the peo- try—no solution that will free our keeps going up as we talk. We must ple of the United States will clearly be economy, no solution that will create take drastic action. This is for the Con- dramatic. If this proposal were a part more and more opportunities for the stitution. of the Constitution of the United present generations and generations Let us take some of their arguments. States today, the President of the yet to come except to make the kind of Their arguments are: Do it by statute. United States could not validly have changes proposed in this constitutional We can do it if we have the resolve to submitted the budget to us which he amendment. do it. But in fact we have tried for the has before us right now. He would be It is clear that tomorrow’s vote is last 30 years to do what was right and required by his oath of office, by the going to be absolutely vital for the fu- Congress found it was always easier to Constitution of the United States ture of this country. It is clear that a spend than it was to cut. They found it itself, to be a part of the solution rath- majority of the people of the country was even easier to tax than to curb er than part of the problem. Political want this constitutional amendment. that voracious appetite for spending. I cowardice would instead be political It is clear that a majority of the Mem- think we have to take the very impor- folly, an abandonment of a constitu- bers of this body want that constitu- tant step of getting this country back tional duty. tional amendment. on track. We have tried to do it by Many of us here might not like the What remains unclear is whether the statute. We tried Gramm-Rudman. We proposals of this President with respect necessary two-thirds in this body will tried the 1990 budget agreement. But to balancing the budget, but he would follow logic, reason, and the will of every time something comes up and have been required to propose such a their constituents and refer this con- Congress wimps out and we do not course of action. And for those of us stitutional amendment to the States of start balancing the budget. We must who dislike it, we would have been re- the United States for ratification. have a constitutional mandate if it is quired to come up with an alternative. The PRESIDING OFFICER. The Sen- really going to work. We have tried ev- Now, anyone can speak of the desir- ator from Texas. erything else. If we are going to do ability of balancing the budget in the Mrs. HUTCHISON. Mr. President, I what is right we must do it by amend- abstract and the lack of desirability of appreciate what the Senator from ment. cutting any spending programs in re- Washington has just been saying. I Some of the opponents say: Tell us ality, and there is no penalty for tak- have been on the floor listening to him. where you are going to cut. We will ing such a course of action. As and He is one of the people I admire most probably vote with you if we know when this proposal becomes a part of in this body. He has been the attorney where you are going to cut. It would be

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00067 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3206 CONGRESSIONAL RECORD — SENATE February 27, 1995 a year from now before we could get ment. I admire and respect him great- should have done in the first place; through all of these arguments and ly. Last year, when he cosponsored this that is, put in our framework of Gov- then go to the argument of how we are amendment, he got all wound up and ernment, if we think something is so going to make these cuts on sort of a he said the reason that there were so important, that we will put it on our try it basis, not for real. many heroes at the Alamo is because priority list and we will pay for it now, No, every business and every house- there was no back door. and if it is not that important, it does hold in America cuts their budget the I love Senator SIMON but I had to not meet the test of responsible gov- same way. They determine what is the come down on the floor and say to my erning. distinguished colleague that his facts priority, what is the revenue, and then So I hope that we will take this mon- were wrong but his point was right. they say: OK, here is what we have to umental opportunity that we have to- The fact is, there was a back door at spend. They do not say here is what I morrow. It is probably the best chance the Alamo. It was a line drawn in the would like to spend and I will just take we are going to have in my lifetime to care of it later. They do what every sand and every man at the Alamo was given the choice of crossing the line to do what is right to get this country State does, they find out what the rev- back on track and to pass a balanced enue is and then they prioritize their fight for the independence of Texas, or to leave at that time. And every man budget amendment to our Constitution needs. I do not know why the Federal so that our State legislatures, while Government does not get it. I do not at the Alamo voluntarily walked across that line, and Jim Bowie was they are meeting now, will have the op- know why the U.S. Congress cannot portunity to ratify or not ratify, but figure out that we, too, can do what carried in his stretcher across that line, to say we are going to commit will have the opportunity to vote on every State, every business and every this very important framework of Gov- household in America does and that is ourselves to fight for the independence of Texas and we are going to volun- ernment issue. And I hope we do the determine what the revenue is and tarily close that door. So they were he- right thing. then decide what the spending prior- roes. They were real American heroes. Thank you, Mr. President. ities are. That is the responsible way But Senator SIMON was making a Mr. LEVIN addressed the Chair. to approach the budget. point, and the point was right. That is There have been legitimate argu- the same thing that we can do right The PRESIDING OFFICER (Mr. ments on the issue of exempting Social here tomorrow; that is, close the back BOND). The Senator from Michigan. Security. I think a lot of people have door, become a hero. The vote tomor- Mr. LEVIN. Mr. President, there are thought why do you not set Social Se- row is what is right for the long-term three amendments that I have offered curity aside? Of course we believe So- future of this country. That is what which I want to describe tonight to the cial Security is inviolate. But we are will close the door, and we will do it in body. talking about amending our Constitu- a responsible manner because it is the First, I am offering two amendments tion. We have seen what Congress has right thing to do for our children to regarding the vote of the Vice Presi- already done to Social Security with- stop this $18,000 debt that they have dent of the United States in the two out one vote by any Republican in the over their heads right now. Yes. This is situations in which the balanced budg- Congress, on the House side or the Sen- the most important vote that we will et amendment calls for a constitu- ate side. Taxes were increased on So- ever cast. tional majority. Section 4 states: cial Security. Thomas Jefferson, one of our Found- I do not think we can assume Con- ing Fathers, must have feared that, in No bill to increase revenues shall become gress is going to do the responsible all of the thinking about what might law unless approved by a majority of the thing. Let us see what would happen if whole number of each House by a rollcall come in the future, perhaps there vote. we exempted Social Security. All of a would be a tendency to spend more sudden more things would be moved money because he probably sensed that Section 5 states: into Social Security. We would have it is human nature to want to spend Provisions of this article may be waived Social Security take up welfare; per- the money to do the good things that for any fiscal year in which the United haps Medicaid. Everything that Con- all of us would like to do. Two hundred States is engaged in military conflict which gress wanted to stuff outside of the years ago, Thomas Jefferson said: causes an imminent and serious military quota that will be established with a The question whether one generation has threat to national security and is so declared balanced budget amendment would just the right to bind another by the deficit it by a joint resolution adopted by a majority be locked into Social Security and imposes is a question of such consequence as of the whole number of each House which be- comes law. there is nothing to prevent it. to place it among the fundamental principles If you are going to exempt anything of government. We should consider ourselves So the question has arisen in debate you cannot have a balanced budget unauthorized to saddle posterity with our as to whether or not the language in debts and morally bound to pay them our- amendment. It will not be effective if selves. these provisions ‘‘the whole number of anything is exempted out because each House’’ would deny the Vice Thomas Jefferson went on to say: whatever it is will then get everything President of the United States a vote There does not exist an engine so corrup- that Congress wants to put in that will tive of the government and so demoralizing to break a 50-to-50 tie. While it is clear not count against the restraints that of the nation as a public debt. It will bring that 51 votes would be necessary under we will put on ourselves through a bal- us more ruin at home than all of the enemies this provision, it is unclear whether anced budget amendment to our Con- from abroad. the Vice President would be denied a stitution. He realized that this is not some- vote in an equal division of 50 to 50. I am going to support Social Security thing that should be done just by stat- Why should he or she be so denied? The and the veracity of our Social Security ute. If it is really going to have teeth, Vice President is not denied a vote in a system as long as I am in public life. he questioned whether it should not go 50-to-50 tie situation anywhere else in But if we take that outside of this con- into the framework of our Government, the Constitution. The proponents of stitutional amendment we will not pro- the policy statements that will last the balanced budget amendment in the tect Social Security. It will be the op- through the generations. And I think House and the Senate have not agreed posite. We will make Social Security his instincts were right, and they have about the effect of this language. In more precarious than it is now because been proven so as our country has gone the House of Representatives, the chief we will not have the ability to say: headlong into over a $4 trillion debt. sponsor of this constitutional amend- This is the budget. Here is the revenue. While Thomas Jefferson was very far- ment, Representative SCHAEFER of Col- And we are going to live within our sighted, I do not think even he could orado, stated in the CONGRESSIONAL means like every family and every have foreseen a $4 trillion debt. But he RECORD on January 26: business and every State in this coun- knew that there was the possibility This language is not intended to preclude try strives to do. that weak Congresses would spend now the Vice President in his or her constitu- Senator PAUL SIMON, the Senator and pay later. tional capacity as President of the Senate from Illinois, has been one of the prime We have the ability to do what I from casting a tie-breaking vote that would movers in the balanced budget amend- think Thomas Jefferson thought we produce a 51–50 result.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00068 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3207 Representative SCHAEFER goes on to indicated in a formal answer on the tion. The 15th amendment says that say: record that it is not intended to deny ‘‘Congress shall have the power to en- Nothing in section 4 of the substitute the Vice President a vote in these cir- force.’’ Again, a court decision has de- takes away the Vice President’s right to cumstances. The chief sponsors in the cided it is not dependent upon Congress vote under such circumstances. Senate have denied that it is intended adopting enforcement language. The However, the principal Senate spon- to deny the Vice President a vote in 19th amendment, ‘‘Congress shall have sor, the Senator from Utah, stated on these circumstances. This is not a the power to enforce’’; the 23rd amend- the floor of the Senate on February 16 record which should be allowed to re- ment, ‘‘Congress shall have the power that the Vice President would be de- main in this condition. The stakes are to enforce’’; the 24th amendment, nied the deciding vote in a 50–50 situa- simply too huge and we should clarify ‘‘Congress shall have the power to en- tion. He went on to cite the example of this one way or the other. force’’; the 26th amendment, ‘‘Congress the President’s 1993 deficit reduction Mr. President, the constitutional shall have the power to enforce’’; the package, which was passed by a 51 to 50 amendment we would be voting on to- 18th amendment, ‘‘Congress and the vote with the Vice President casting morrow does not balance the budget. several States shall have concurrent the deciding vote, as legislation which By its own terms, some future Con- power to enforce.’’ would not have passed had this con- gress would still need to adopt enforce- The 13th amendment, the amendment stitutional amendment then been in ef- ment and implementation legislation which abolished slavery, provides that fect. to achieve a balanced budget. The ar- ‘‘Congress shall have the power to en- Mr. President, the two amendments gument has been made that we have force.’’ But the 13th amendment, like which I have offered are very straight- tried everything. We have tried legisla- the others I have described, is not de- forward. One makes it clear that the tion; we have tried statutes; we have pendent on legislation. It is enforce- Vice President has a vote. If that fails, tried passing laws. Why not a constitu- able without legislation. the other would say that he does not. tional amendment? It would be unthinkable, I believe, Think for a moment about a future The argument goes: ‘‘We can’t depend for any of us to believe that the 13th situation like the Persian Gulf war. A on legislation, so let’s try a constitu- amendment, or an amendment like it, future President required to make a de- tional amendment.’’ would pass which said something like cision about the deployment of thou- So what does the constitutional the following: Slavery will be abolished sands of American troops, in a situa- amendment do? It depends on the same in this country when Congress enacts tion in which he might not know if kind of legislation. The exact same legislation to abolish it. they would be attacked or required to kind of legislation needs to be enacted The 13th amendment and the other enter into hostilities, might well not under the terms of this constitutional amendments which I have described are be able to assess whether the outlays amendment which the sponsors of the self-enforcing. They do not depend required to support those troops would amendment say has previously been in- upon legislation for them to be en- exceed the balanced budget because he effective. forced. does not know if hostilities will occur. The constitutional amendment may Mr. President, the importance of the But he would be reluctant, properly, to sound fiscally conservative, but it will need for Congress to adopt imple- deploy those troops without the cer- delay the day of reckoning for up to 7 menting legislation has been discussed tain knowledge that they would be un- years and it will still depend upon con- and described by many, many people. equivocally given the necessary re- gressional action for there to be a reck- The most recent Director of the Con- sources to support them in the field, if oning even then. gressional Budget Office, Mr. attacked or if needed. Approval of such I have offered an amendment to the Reischauer, said the following about authority might be a close question as constitutional amendment. My amend- this issue. He said, ‘‘First of all,’’ and it was in the case of the gulf war. ment would require this Congress to here I think he is in agreement with What if we faced a 50-to-50 vote to pass the needed enforcement legisla- most, if not all, of us, ‘‘a large reduc- waive under section 5? With the lan- tion and not pass the buck to a future tion in Government borrowing is high- guage unclear, is it not likely that the Congress to pass the enforcement legis- ly desirable.’’ But then he said that ‘‘A Vice President would be in the chair, lation, which is so critical if this con- balanced budget amendment, on its and that he or she would vote? Would stitutional amendment be effective. own, does not advance the chances for there then be a point of order raised My amendment provides that the lowering Federal borrowing.’’ that his vote was unconstitutional constitutional amendment, if we adopt ‘‘A balanced budget amendment, on under section 5? What if the Senate it tomorrow, would be submitted to the its own, does not advance the chances voted 50 to 50 on the constitutional States for ratification only after we for lowering Federal borrowing.’’ He point of order? The Vice President have enacted legislation specifying the put it another way in his testimony. might then break that tie. Might not means for implementing and enforcing That ‘‘A balanced budget amendment, the law providing the waiver then be its call for a balanced budget. in and of itself, is not a solution, rath- subject to a lawsuit arguing that it was Now, there are two advantages to er it is only a repetition in an even unconstitutional because the Vice this approach. First, it places the re- louder voice of an intention that has President had voted? Should we invite sponsibility on us instead of leaving it been stated over and over again during this sort of constitutional crisis by to the future. Second, the States would the course of the last 50 years.’’ He leaving ambiguity in the amendment? I be informed how the enforcement went on to say that ‘‘A balanced budg- say no. mechanism would work so they could et amendment, in and of itself, will I would prefer that we approve the consider that in their ratification de- neither produce a plan nor allocate re- first of these amendments, thus pre- liberations. sponsibility for producing.’’ In perhaps serving a vote for the Vice President. I First, Mr. President, there is no his most pointed comment, he said urge my colleagues to vote against ta- doubt that for this amendment to be that ‘‘Without credible legislation for bling amendment No. 310. However, Mr. effective, a Congress must pass en- the transition that embodies an effec- President, I hope that those who be- forcement or implementing legislation. tive mechanism for enforcement’’—an lieve that the Vice President should Section 6 reads that: effective mechanism for enforcement— have no vote in such circumstances The Congress shall enforce and implement ‘‘Government borrowing is not going to would support amendment No. 311. this article by appropriate legislation. be cut.’’ And he concluded that Logically, every Senator, in my view, This is different from most other thought by saying, ‘‘But the transi- should support one amendment or the amendments to the Constitution and tional legislation and the enforcement other. A vote to table both is a vote to most other provisions in the Constitu- mechanism are 95 percent of the battle. leave this proposed constitutional tion. If we could get agreement on those,’’ amendment ambiguous on a matter of For instance, the 14th amendment he said, ‘‘we would not need a constitu- considerable importance. I will reit- says that ‘‘Congress shall have the tional amendment.’’ erate one critical point. The chief power to enforce,’’ but it is not depend- Yet, this constitutional amendment sponsors in the House have specifically ent upon the Congress adopting legisla- depends on there being an agreement

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00069 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3208 CONGRESSIONAL RECORD — SENATE February 27, 1995 on an enforcement mechanism by a fu- Mr. LEVIN. At what point will it be deter- all taken an oath to uphold the Con- ture Congress. mined that outlays will in fact exceed reve- stitution, that that will increase pres- Supporters and sponsors of this legis- nues and that action such as a tax increase, sure on Members to adopt enforcement lation have said in the past, over the spending cuts, or tapping into a rainy day legislation. fund will be required? . . . years that this constitutional amend- Mr. SIMON. . . . future legislation will work First of all, our oath to the Constitu- ment was being considered, that en- out the details. tion does not require, does not assure, forcement legislation is critical to its The importance of enforcement legis- we will be able to agree on any par- success. lation is recognized inside the constitu- ticular mechanism or set of procedures Senator DOMENICI , back in 1982, said tional amendment itself. In section 6— to carry out the constitutional amend- that ‘‘Congress is going to have to pass and the report of the committee makes ment if it is adopted. The oath we take some very difficult enabling legislation it clear that within section 6 it says is not a group oath, it is an individual to carry out the purposes of this that the Congress shall enforce and im- oath. As individuals, we would be duty amendment.’’ plement this article by appropriate leg- bound to carry out the intent of the Senator THURMOND, in August of 1992, islation—the words of section 6, in the Constitution, of course, duty bound to said: ‘‘The amendment would not be words of the committee report: support an endorsement mechanism, self-enforcing. There would be a clear presumably. But that is far different responsibility upon Congress to develop This section recognizes that an amend- ment must be supplemented with imple- from language being self-enforcing, be- procedures to ensure that it is capable menting legislation. cause there is no assurance that a ma- of satisfying its new constitutional re- Again, Senator HATCH, the distin- jority of the Congress would agree on sponsibilities under the proposed guished chief sponsor of this legisla- the same mechanism, even though amendment.’’ Again, he said back in tion, said as recently as January 30 every Member might carry out his con- 1982, ‘‘There is no serious question that that: stitutional duty and vote for one en- Congress will have to develop effective forcement mechanism or another. implementing legislation.’’ Moreover, under section 6 of the amend- ment, Congress must, and I emphasize must, Senator HATCH, the prime sponsor of To the extent that the Constitution mandate exactly what type of enforcement adds some pressure to reach a majority this legislation, in March of 1986, said mechanism it wants, whether it be seques- the following: tration, rescission, or the establishment of a decision on an enforcement mecha- There is no question that Congress would contingency fund. nism, that pressure would be signifi- have to pass implementing legislation to Mr. President, there have been a cantly enhanced and made much more make it effective. In that sense, it is not self- number of critical questions raised dur- real if the Senate adopts my amend- executing. It would be the obligation of Con- ing this debate that have also been left ment tomorrow. gress, after the amendment is passed by both Under my approach, the pending con- Houses and ratified by three-quarters of the to enforcement legislation. There is States, to, of course, enact legislation that the question of impoundment. Will the stitutional amendment—assuming, of would cause a balanced budget to come President have the right to impound course, that two-thirds of the Congress about. under this constitutional provision? votes for it—would be sent to the The committee report for this legis- The answer is, that will be determined States for ratification only after the lation says the following: by implementing legislation. enforcement legislation is passed. And Congress has a positive obligation to fash- Then the question is, what is the role to the extent that there is a hammer ion legislation to enforce this article. An of the courts? An absolutely essential on Members in the language of the amendment dealing with subject matter as question for many Members of this pending amendment to adopt enforce- complicated as the Federal budget process body, indeed a question so essential ment language down the road, there is must be supplemented with implementing that some votes may be dependent a hammer on Members to adopt the en- legislation. upon making certain that the courts forcement legislation if the pending In a colloquy that I had with Senator will not be able to raise taxes or to constitutional amendment is not sent SIMON the last time that this amend- veto appropriations. to the States for ratification until ment was before this body, we had the And, by the way, the chief sponsor in after we adopt that enforcement mech- following questions and answers: the House said specifically in a ques- anism legislation. Mr. LEVIN. . . . How would the monitoring tion and answer colloquy that a court Now, without my amendment, if we of the flow and receipts of outlays be done to could have the right to veto an appro- adopt a constitutional provision to- determine whether the budget for any fiscal priation or a revenue. year is on the track of being balanced? morrow, it is but an empty promise. It These are absolutely essential ques- would allow the Congress to put off Would this require implementing legisla- tions to not be left ambiguous. The an- tion? adopting the credit implementation Mr. SIMON. There would have to be moni- swer is future enforcement legislation legislation, and therefore allow the ar- toring, and future legislation would have to will determine whether or not the gument to be made that the deficit was take care of the implementation of that court will have any such authority. cured, although, in fact, the strong monitoring. Well, it is not good enough to leave medicine has not even been taken. Mr. LEVIN. What exactly is the definition the critical issues and the teeth to fu- of receipts and outlays? Specifically, would ture enforcement legislation when this There are two advantages, again, to the receipts and outlays to the Bonneville Congress can and should adopt that adopting this amendment. First, it Power Administration be receipts and out- legislation prior to this amendment places the responsibility on this Con- lays of the United States pursuant to this gress instead of leaving it to a future constitutional amendment? Would the an- going to the States, assuming, again, that it passes the Senate tomorrow. Congress. We should not kick that en- swer to these questions require imple- forcement can down the road to some menting legislation? There is no reason why we should not Mr. SIMON. Implementing legislation will accept the responsibility of deciding uncertain time and some uncertain be needed on some of these peripheral ques- what is in that enforcement legisla- fate. Enacting a clear mechanism for tions. . . tion, what the teeth will be, what the enforcing the constitutional amend- Mr. LEVIN. . . . In an instance in which the sequestration mechanism will be, and ment before the amendment goes to Office of Management and Budget and the the States is a way of assuring that we Congressional Budget Office disagree with not just simply kick the enforcement can down the road. meet our responsibility instead of abdi- each other on what a level of outlays is, how cating it. will the dispute be resolved so that it can be If we do that, it means there is no determined whether or not outlays exceed hook. We are off the hook for 7 years, Second, the States would be informed receipts? at least, because 2002 is the first year it how that mechanism would work so Mr. SIMON. Future legislation will have to is enforced. And we may find there is that they could consider that in their take care of this. no hook then. ratification deliberations. This would Mr. LEVIN. Who will determine the level of receipts and whether a revenue bill is ‘‘a bill Mr. President, it has been said if this not be a long delay. We were given as- to increase revenues″? ... constitutional amendment is adopted, surances by the Senator from Utah the Mr. SIMON. That will also have to be deter- that we will adopt some future imple- other night relative to part of the en- mined through future legislation. mentation legislation; because we have forcement legislation as it relates to

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00070 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3209 the courts, assurances that were given hopefully we can finish tomorrow in a [From the Washington Post, Feb. 27, 1995] to the Senator from Georgia, that that short time. AN INVITATION TO DISASTER could be worked out during a summit Mr. President, the opponents of the by the end of the summer. I believe he balanced budget amendment seem to The Balanced Budget Amendment would said this need not be a long delay. This have an infatuation with requiring the destroy the ability of the United States gov- is just a matter of months to be sure implementation plans before we pass ernment to prevent economic depressions, to that we do not just say, in a constitu- the balanced budget amendment. This respond to natural disasters, to protect the savings of tens of millions of working Ameri- tional amendment, some future Con- latest version requires us to pass the implementing legislation before we cans, and, over time, to enable the economy gress should adopt enforcement legisla- to grow. tion to achieve a balanced budget. pass the amendment itself. This is, to My amendment, if adopted, would say the least, a peculiar way of pro- The ability of the federal government to pump money into an ailing economy has make sure that if we adopt a constitu- ceeding. time and again in the postwar era limited tional amendment, that before we send This amendment is a requirement that we put the cart before the horse. the depth and duration of a recession and it to the States for ratification, that prevented a depression. During the 1957–58 we adopt an enforcement mechanism to Mr. President, how can we implement a recession, the Eisenhower administration de- achieve a balanced budget. That will constitutional amendment which has liberately increased the deficit. That strat- make it much more likely. I am very not yet been ratified? egy brought a rapid end to the decline. Dur- concerned that enforcement mecha- If the Framers worked as this pro- ing every recession thereafter, either by de- nism would be adopted and that it posal suggests we should, all Federal sign or through circumstance, a deficit was would then be subject to the scrutiny laws would have had to be passed be- crucial in containing and ending the decline. of the States in determining whether fore there was even a Congress to pass For example, tax reductions adopted in 1981 them. Does the Senator believe we were not planned as a counter-recession tac- or not they should ratify this amend- tic, but the enacted cut that took effect in ment. should have had to choose all the ju- rors for a trial before we adopted the 1982 was the key to the recovery that began Mr. President, I thank the Chair. I in that year. yield the floor. sixth amendment? Or pass the 1964 Mr. HATCH. Mr. President, I will not Civil Rights Act before we adopted the Floods in the Midwest, hurricanes in the Southeast, and earthquakes in California be long. I understand that the Senator 14th amendment? This type of amendment is a perfect during recent years prompted the federal from Maryland would like to speak. government to spend hundreds of millions to I would like to point out one more example of why we need the balanced budget amendment. Congress is always relieve suffering and limit damage. Sci- time about our balanced budget debt entists who study natural phenomena warn tracker. We only have 1 more day to looking for a way out—a way to stave against worse disasters. The balanced budget go. We might as well finish what we off responsibility. And the Congress amendment would keep the federal govern- started, and that is after the 27th, we knows that the balanced budget ment from dealing with such calamities. amendment means that it will be held were $22 billion in debt; after the 28th, Occasional man made disasters have oc- responsible for its actions. we will be up to $23 billion; the 28th curred throughout the history of cap- It also confuses the debate about the day, we have added to our deficit of $4.8 italism—for example, the savings and loan rule with the debate about outcomes trillion since the beginning of this de- debacle of the 1980s. Had the federal govern- within the rule. The proponents are in- bate. Frankly, we are now in day 29, ment not been able to provide the money to terrupting the discussion of the rules and here we are, as we debated this validate the deposits of millions of ordinary until the outcomes within the rules citizens, their losses and runs on saving and matter, we are now up to $24,053,760,000 can be determined. It is like stopping commercial banking institutions would have in additional debt to the baseline of the discussion of the rules of a poker recreated 1932. To assume that financial cri- $4.8 trillion since we started debating. game until it can be determined what ses will never recur is unrealistic. We will be adding one more of these hands will be dealt. We need to estab- The balanced budget amendment ignores green debt tracker slots tomorrow, the lish this new regime of rules before we the nature of our monetary system. The Fed- 30th day since we started debate on can start implementing it. eral Reserve and the commercial banks issue this matter. Mr. President, I have made it as clear money against their holdings of federal debt. It is apparent this will go up every as I possibly can that after the bal- Under a balanced budget amendment, the day we do not pass a balanced budget anced budget amendment is ratified, I debt will not increase. Eventually the sys- amendment. It is apparent we will have will be more than happy to work with tem will not be able to create the money the economy needs in order to grow. to have $300 billion a year in added any Member of the Senate in drafting deficits, maybe $350 billion a year in the implementing legislation. I cannot The Jerome Levy Economics Institute. added deficits every year that we do do any more than that. It is simply not S JAY LEVY, not do something about this. So this possible to do as the proposed amend- Chairman. LEON LEVY, balanced budget debt tracker is a very, ment seeks, to pass the implementing very, important indication of just President. legislation before the balanced budget HYMAN MINSKY, where we are going. amendment is ratified. Distinguished Scholar. We have to do something about it. I hope we can put this proposal aside DIMITRI PAPADIMITRIOU, Everybody admits that. Are we going and move back the real issue at hand— Executive Director. to do business as usual, which is where will we stop the Government’s slide EDWARD V. REGAN, we have been for the last 60 years—cer- into an endless pit of debt or stand idly Distinguished Fellow. tainly, the last 36 years, when we have by and watch as the country falls into DAVID A. LEVY, only balanced the budget once—or are economic crisis? Vice Chairman, Director of Forecasting. we really going to do something new IN OPPOSITION TO THE BALANCED BUDGET Mr. CHAFEE. Mr. President, there is here, something that would work, to AMENDMENT no greater problem facing the country put the pressure on Presidents to have Mr. MOYNIHAN. Mr. President, the today than our continual failure to bal- to do something about bringing the distinguished scholars and administra- ance the Federal budget. budget into balance, and something tors of the Jerome Levy Economics In- Unfortunately, this is not a new phe- that would put pressure on Members of stitute of Bard College placed an adver- nomenon. Over the past 33 years we Congress to make priority choices tisement in this morning’s Washington have balanced the budget once, one- among competing programs? Post which delineated the perils of quarter of a century ago in 1969. Had If we do not do that, we are mort- writing economic policy into the U.S. the Social Security program not gen- gaging the future of our children and Constitution. This document deserves erated a surplus, we would not have grandchildren. I hate to see that. To- the fullest attention of the Senate and balanced the budget in that year ei- morrow is a big day. By the end of the I ask unanimous consent that the en- ther. day, we will know whether we passed a tire text be printed in the RECORD. balanced budget amendment, and I There being no objection, the item Furthermore, the forecasts put out hope we will. I will limit my remarks was ordered to be printed in the by the Congressional Budget Office and to that and the chart tomorrow, and RECORD, as follows: the administration show that, absent

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00071 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3210 CONGRESSIONAL RECORD — SENATE February 27, 1995 dramatic action on our part, these defi- work force whose skills are continually What exactly does the balanced budg- cits will not end any time soon. For ex- updated, provide the foundation for in- et amendment do? Very simply, it pro- ample, CBO predicts that the deficit in creasing our output of goods and serv- hibits Federal outlays from exceeding the year 2005 could be as high as $421 ices. With this higher productivity Federal receipts unless a three-fifths billion. comes a higher standard of living. majority of both Houses of Congress The President’s budget, which was To achieve this, however, we must approve a specific deficit. released early this month, forecasts have a pool of national savings from In other words, it says that Congress Federal deficits of approximately $200 which this investment can be made. can only spend what it is willing to col- billion for each of the next 5 years, and Unfortunately, our national savings lect in taxes, unless Congress deter- gives no promise that they will decline rate has declined dramatically over the mines that there is a legitimate reason anytime after that period. Even worse, last decade, in part because the Federal for running a deficit. Such a situation the President has taken little action to Government has engaged in a policy of could arise, for example, if the country address this problem. dissaving through its deficit spending. fell into a recession or was hit with a In the President’s plan, $81 billion of The Federal Government’s reliance on natural disaster. But those would be deficit reductions are relatively minor borrowing to pay its bills crowds out the exceptions which Congress would when it is realized those occur over 5 the private sector, making it more dif- expressly authorize. The balanced years; $60 billion of those cuts come ficult for it to obtain financing. budget constraint on Congress would from keeping discretionary spending at But the worse consequence of this fis- be comparable to that which every today’s level. cal irresponsibility is that we are jeop- American family faces. Why is it bad that the Federal Gov- ardizing the economic futures of our Mr. President, this amendment ernment routinely spends more than it children and grandchildren. We are liv- makes fiscal responsibility the norm takes in? ing beyond our means and passing rather than the exception. We are told in soothing tones by the along the bill to future generations. The Federal Government has failed administration that the deficits are I recently ran across a paper which to balance its budget for 25 straight each year predicted to be a lower per- described this problem. The paper dis- years. Over this period there have been centage of the gross domestic product. cussed the idea of generational ac- both Republicans and Democrats in the That is somehow meant to be grand counting, which a process of measuring White House, and the Senate has had news, even though the dollar amounts how Government policies affect the both Republican and Democratic ma- of the deficits constantly grow. distribution of income and wealth jorities. Neither party is free from The problem is that every year we among different generations rather blame. The truth is, there has not been run a deficit, we must borrow to fund than simply over a 5- or 10-year budget the will to make the tough decisions the shortfall. From the beginning of period. necessary to balance the budget our country until today, we have in- To make this comparison, the au- The amendment before the Senate curred a debt of about $5 trillion, with thors calculated lifetime net tax rates today demands the same fiscal respon- the overwhelming portion of that accu- for various generations. My generation sibility from the President that it es- mulated over the past 15 years. will face a lifetime net tax rate of 26 tablishes for Congress. It requires the The cost of servicing that debt will percent. This compares to a lifetime administration to submit a budget to total $339 billion in 1995, making inter- net tax rate of 34 percent for a person Congress in which outlays do not ex- est the second highest single Federal born in 1991. ceed receipts. I think that makes per- expenditure after Social Security. What is troubling is the gloomy fore- fect sense. It recognizes that both To put this number in perspective, cast for future generations. According branches of Government must partici- our gross interest expense for 1995 is to this analysis, if we do not take ac- pate in this very difficult task if we are more than the entire Federal budget 20 tion to improve our fiscal situation, fu- to succeed. years ago. Imagine how this money ture generations will face lifetime tax In addition to requiring a balanced could be used to improve our edu- rates that approach 70 percent. In budget, the amendment requires a ma- cation, or better our health care sys- other words, future generations can jority of the whole number of each tem, or bolster our efforts to combat look forward to handing over 70 cents House of Congress to approve, by a roll- crime. of each dollar earned to the Govern- call vote, legislation raising revenue. Aside from diverting resources that ment if we do not reverse our present Frankly, this is not a critical compo- could be used for much better purposes, course. nent of this proposal, because histori- the deficit also places a great strain on For the past few years the adminis- cally most tax bills have passed Con- the national economy. The most nota- tration has also included a gress with constitutional majorities. ble effect is on interest rates. generational analysis in its budget doc- However, I am grateful that the spon- Alan Greenspan, Chairman of the uments. Its analyses generated results sors have not sought to include a Federal Reserve Board, recently testi- that were similar to the figures just three-fifths majority requirement for fied before the Finance Committee on mentioned. Unfortunately, the Presi- raising revenue. That issue was consid- this subject. According to Chairman dent chose to delete this section from ered and rejected by the House, and Greenspan ‘‘investors here and abroad this year’s budget. rightly so. That provision would be dis- are exacting from issuers of dollar-de- Why will future generations face astrous for this country, because it nominated debt an extra inflation risk such a daunting tax bill? Consider the would significantly hamper our ability premium that reflects not their esti- obligations we have levied upon them. to govern. Facing a potential deficit, mate of the most likely rate of price The Social Security Program, while Congress would, in all likelihood, be level increase over the life of the obli- solvent today, faces drastic long-term forced to cut spending rather than gation, but the possibility that it could problems once the baby-boom genera- raise revenue because the latter would prove to be significantly greater.’’ This tion—born in the 1950’s—retires. The be much more difficult to accomplish. risk premium is directly the result of surpluses, that the program is cur- While I support spending cuts over tax our large Federal budget deficits. rently generating, will reverse in the increases, it would be unwise for us to These artificially high interest rates year 2013 and will quickly evaporate, tilt the playing field against raising affect all Americans. Families pay this leaving workers in the middle of the revenue as part of the Constitution. I risk premium when they borrow money next century with a hefty bill for pro- would not support this amendment if for a home, for a new car, to finance viding retirement benefits for those the three-fifths majority for raising their children’s education. working today. revenue were included in it. The Federal deficit also has a nega- On top of that, the general fund has The amendment includes a process tive effect on future economic growth. amassed $5 trillion in debt to date and whereby its requirements could be Our potential to expand the economy is is likely to add $750 billion more even waived by a simple majority for any directly linked to the amount we in- with the passage of the balanced budg- year in which a declaration of war is in vest in physical and human capital. et amendment. At some point that debt effect or where the United States is en- Newer and better machinery, and a must be repaid. gaged in military conflict which causes

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00072 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3211 an imminent threat to national secu- What it represents is the first and amendment tomorrow and begin to rity. I think those are legitimate cir- most important step in a long and very chart a new course for this Nation. cumstances to warrant deficit spend- difficult journey to fiscal responsi- And there is now question that our ing, and the amendment provides the bility. It symbolizes that the tides Nation needs to change direction—both appropriate amount of flexibility to have finally changed; that we are com- politically and economically, and put adequately address them. mitted to living within our means, and an end to the fiscal status quo. That Mr. President, the amendment en- that we are willing to embody that message was made clear to all of us compasses the entire Federal budget. principle in the document that sets after the results of last November’s Section 7 states that ‘‘total receipts forth the foundation on which our elections. It is time to hear and act on shall include all receipts of the United whole system of government operates. States Government except those de- Other fiscal disciplines we have en- that clarion call for change. rived from borrowing’’ and that ‘‘total acted, while important, have not done Tomorrow, we will have a chance to outlays shall include all outlays of the the job. The Gramm-Rudman-Hollings put to an end some of the hallmarks, United States Government except for deficit control laws, the firewalls, the some of the monuments, of America’s those for repayment of debt principal.’’ discretionary spending caps, and the status quo: our growing national debt What this means is that every dollar pay-as-you-go rules have failed to and annual deficits. that comes into the Treasury and break the attractive lure of deficit I graduated from the University of every dollar that goes out of the Treas- spending. ury will be counted in determining Opponents have argued that we Maine in 1969, and since the day I grad- whether the budget is balanced. should not pass a balanced budget uated, Congress has been unable—even Again, this makes eminent sense and amendment until its supporters outline unwilling—to pass one Federal budget is exactly the way every family in specifically how we plan to reach that that would have brought revenues in America must manage its fiscal affairs. goal. That was the so-called right-to- line with expenditures. That’s right— Much of the effort to derail this reso- know amendment to the resolution be- we have not experienced one balanced lution has centered on excluding cer- fore us. But this is simply a smoke- budget since 1969, 26 years ago. It is al- tain programs from the balanced budg- screen thrown up by those in this most hard to believe that we haven’t et requirement. In fact, this assault Chamber who have no intention of sup- passed a balanced budget since the year began during the amendment’s consid- porting this proposal, whether or not a America put a man on the Moon. But eration in the Judiciary Committee, plan is outlined. with today’s $4.7 trillion debt, we could when an effort was made to exclude So- The fact is, there is no agreed upon walk to the Moon and back on a bridge cial Security. path to reaching a balanced budget. of dollars bills stacked end to end from Mr. President, I find it inconceivable The path that I would prescribe is like- that debt. that we would consider adopting, as ly to be different than the paths that As I have said before, this 26-year dry part of the Constitution, an exclusion other members might advance. Any stretch represents one of our Nation’s for Social Security or any other aspect plan that will be adopted to reach this worst losing streaks, and it is Con- of the federal budget. I am firmly be- goal, will be the product of numerous gress’ very own fiscal losing streak. hind protecting the fiscal soundness of compromises and the give and take of the Social Security System, but I the normal political process. All of But, today, we stand at the precipice think it is absurd to exempt a program that will take place once the require- of monumental change—the kind of that represents 29% of all Federal re- ment is established. The appropriate change the American people voted for ceipts and 22% of all Federal outlays. time frame for outlining how to bal- last November. The kind of desire for The true folly with this effort to pro- ance the budget is after we have com- change that brought me here to this tect Social Security is that by apply- mitted ourselves to making that the Chamber as a U.S. Senator. Today’s ing different rules to that program it law of the land. It is the process that vote on this measure will help the becomes a magnet for efforts to cir- we are trying to change with this pro- American people, ‘‘to know the change cumvent the balanced budget amend- posal. and feel it,’’ in the words of the English ment. Other federal programs will To those who do not support the reso- poet, John Keats. begin to find their way under the So- lution before us I ask: What is your Today is our opportunity to rise to cial Security umbrella, and we will plan? Are you content with the current the occasion and meet the expectations have achieved little if anything in the situation where annual deficits exceed of the citizens of this country, or, we way of deficit reduction. This loophole, $200 billion for the foreseeable future? merely do nothing and uphold the mal- once opened, would be very difficult to Do you believe that if we put this prob- aise of economics-as-usual. shut. lem off for another day, it will get easi- Exempting Social Security receipts er? Do you believe that we are improv- Passing the balanced budget amend- would also provide a perverse incentive ing our children’s futures by dropping ment will help restore a lost sense of for future Congresses to shift Social this massive debt in their laps? confidence and trust that our institu- Security taxes revenues to the general Mr. President, every previous effort tions of Government have been lacking fund. This action would be particularly to balance the budget without an for the past generation. Tomorrow’s attractive since the program currently amendment to the Constitution—that vote marks our generations’ chance to collects more in revenue than it pays is, by statute—has failed to achieve make a positive difference for all other out in benefits. But such an action that goal. future generations of Americans. And would seriously undermine the actu- Why has that been the case? The an- as we act on this proposal, we should arial balance of the Social Security swer is simple. remind ourselves that what we do—or trust fund, and would almost certainly Once the targets become too difficult do not do—tomorrow on the floor on require draconian changes in the future to meet, we simply changed the law. this amendment affects a generation in order to stave off bankruptcy when This resolution makes it difficult for that currently has no say, no voice, the baby boom generation retires. The us to avoid our responsibility. The task and no vote. irony of the exemption for Social Secu- is monumental, but the consequences But they will pay the price. They will rity is that, unless our fiscal house is for our failure are far worse. If this foot the bill. They will bear a terrible in order, we won’t be able to meet our amendment is defeated, the ones who burden. Social Security obligations. And unless will be hurt the most are the future Social Security is factored into the generations of our nation. While today’s vote has the promise of balanced budget equation, we will not Ms. SNOWE. Mr. President, as I have marking a new beginning for America, get our fiscal house in order. done on so many previous occasions in we must understand that it is only part Critics of the balanced budget Congress, I rise today in strong support of the means to the end—not the end of amendment argue that it is a sham; of a balanced budget amendment to the the process itself. If and when we de- that it avoids the rough choices re- Constitution of the United States. cide to pass this balanced budget quired to balance the budget. I strong- It is my hope—and that of the Amer- amendment, we begin a process that ly disagree. ican people—that we will pass this our Founding Fathers envisioned to be

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00073 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3212 CONGRESSIONAL RECORD — SENATE February 27, 1995 in the best interest of democracy and In fact, it should be pointed out that $176 billion, $222 billion in 1998, $284 bil- the welfare of the American people. the Office of Management and Budget lion in 2000, and $421 billion in 2005. Not Let us be clear about one thing: with has already estimated that if we con- only that, but between now and 2002, tomorrow’s vote, we will not be ratify- tinue our current cycle of deficit we will add a cumulative total of near- ing the balanced budget amendment. spending, future generations—those ly $2 trillion to the existing debt if we We will merely be giving the 50 States who will inherit a Nation beset by fis- make no change in fiscal policy. the opportunity—the chance—to ratify cal problems we could not solve—will But the American people also need to the amendment before us. Congress has be forced to suffer a tax rate of 82 per- know that these numbers have a direct an obligation and a responsibility to cent in order to pay the bills we left be- impact on their lives and on the future let the American people’s voice be hind. of their families. And they need to heard throughout the Nation, in every The American people and opponents know that a balanced budget amend- state capital. Seventy-eight percent of of this measure need to be reminded ment would have a positive impact on the American people support the bal- that the annual interest we pay on our their futures and on the economy of anced budget amendment, according to ever-increasing national debt has the Nation. a recent survey by KRC Research and grown almost exponentially, rising The New York Federal Reserve Consulting. Nearly three-quarters of from $177 billion in 1982—the only year Board, in an often referred to study, all Democrats—73 percent—support the when the Senate passed this measure— showed how America lost five percent amendment, 88 percent of all Repub- to almost $300 billion in 1994. And our growth in gross domestic product—a licans, and 79 percent of all unenrolled annual interest payments are expected loss in economic growth that trans- voters. to balloon to $373 billion in 1999, for a lates into a 3.75 million job loss during Mr. President, I am confident that, 219-percent growth rate between 1982 the decade spanning 1979 and 1989—jobs when given the chance, the States and and 1999. the American people will say ‘‘yes’’ to To appreciate the impact of interest in rural America, jobs in our inner cit- a new regimen of spending within our costs on our annual deficits, one only ies, jobs on America’s farms, and jobs means; they will say ‘‘yes’’ to fiscal re- need look at the chart behind me. If we for America’s youth. sponsibility, they will say ‘‘yes’’ to continue our current fiscal course, the The Concord Coalition study showed putting our Nation’s fiscal house in interest costs related to servicing the that a loss of national productivity has order on a permanent basis, and they debt will continue to exceed our total caused a sharp decline in America’s will say ‘‘yes’’ to a Congress account- annual deficits. family incomes, resulting in an aver- able to them and their needs. The American people and opponents age family income of $35,000 rather After almost 4 weeks of continuous of this measure need to be reminded than the estimated $50,000 it would debate in the Senate and almost 13 that every day, we add $819 million in have been in the absence of our struc- years after this Chamber passed this daily interest to the national debt. tural deficits and burgeoning debt. same measure by one vote, and after 26 That figure will rise to $1 billion in in- In June 1992, the General Accounting years of continuous deficits and grow- terest every single day of the year. In Office released a report showing a grad- ing debts, it is hard to believe we have fact, as I speak here for about 8 min- ual decline in America’s quality of life again come to this point. utes on behalf of the balanced budget We have arrived at this juncture not and standard of living if our deficit amendment, we will have added almost necessarily by choice, but because eco- spending is not brought under control. $5 million to the debt. Unfortunately, nomic and financial circumstances But the report also showed that if we have compelled us to act. Our failure to even when I do stop speaking, the debt did balance the budget by the year 2001, take responsible action to end years keeps on growing—and growing, and then by the year 2020 the average and years of spiralling debt and deficit growing like the ‘‘Energizer Bunny of American will have real growth in spending in the past is forcing our hand our fiscal irresponsibility.’’ quality of life and income by 36 per- The American people and opponents today. But make no mistake about it, cent. of this measure need to be reminded tomorrow’s vote is about tomorrow’s The econometrics firm DRI/McGraw that these interest payments on the generation. Hill reported that a balanced budget is Although the figures and statistics debt already consume 14 percent of our worth $1,000 a year to the average about our debts and deficits have often annual Federal budget. These interest American household over the next 10 been mentioned during Senate debate payments consume 57 percent of all years. A balanced budget would boost on the balanced budget amendment, personal income taxes each year, while long-term economic growth: national they bear repeating once again in order the interest payments we make on our interest rates would drop by 2.5 percent to show the American people—and op- debt are eight times higher than what and by the year 2002, half the savings ponents of this measure—the dev- we spend on our children’s education, that is said to be needed in our budget astating costs of our fiscal irrespon- 50 times higher than what we spend on simulations could come from lower in- sibility and lack of action. job training for our workers, and 55 terest costs. times higher than what we spend on I think the American people and op- So the balanced budget amendment Head Start programs. With these inter- ponents of this measure need to be re- is not a gimmick—it does yield posi- est payments out of the way, Congress minded that, since 1980, our national tive results. Most importantly, it puts can finally prioritize its spending to debt has grown from $1 trillion to a into law what Congress has been un- where the American people want their staggering $4.7 trillion for a growth able and unwilling to do for the past rate of 309 percent. And our national tax dollars to be spent. The American people are painfully two decades: that is, muster the cour- debt is expected to grow to a whopping age and discipline necessary to balance $6.3 trillion by 1999, for a growth rate of aware that the estimates of future defi- cits aren’t getting any smaller no mat- the budget without an amendment to 453 percent since 1980. And an astound- the Constitution. ing 17 percent of our national debt— ter how much Congress procrastinates $800 billion—is held by other nations or its fiscal discipline. Only a few months Over the years—and often to stem people in other nations—so even con- ago, the Congressional Budget Office the tide toward a balanced budget trol over our own indebtedness has told Congress that the estimated def- amendment—Congress has tried to bal- been handed to foreign banks and for- icit in the current fiscal year would ance the budget through statutory eign creditors. reach $162 billion, steadily rise upward means. And on each and every one of The American people and opponents to $197 billion by 1998, and climb again these efforts Congress has failed. of this measure need to be reminded to $257 billion in the year 2000, and $319 The simple fact is statutory laws are that in the next 5 years alone, the per- billion in 2002. easy to ignore. They are a paper tiger. sonal burden of this debt and these in- The CBO now estimates that the def- During the past 26 years, Congress has terest payments for every American icit will be higher than prior projec- operated without this amendment, but man, woman, and child will rise from tions by an average of $25 billion per with eight statutes designed to lower $17,938 to $22,909—that’s growth of year over the next 5 years. This year’s or eliminate deficits. Looking at this nearly $5,000 in just 5 years. deficit has already been increased to chart, it is clear what the results have

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00074 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3213 been. Passing this amendment is the of the Senate to give its advice and through legislation, to take away the only way—our last choice, our last re- consent to treaties; and the two-thirds jurisdiction of the Supreme Court or sort—to put our fiscal house in order. vote requirement of the Senate to con- the Federal courts on a constitutional I share the sentiments of whose who vict on impeachment. issue. There is a post-Civil War case, ex say Congress should be able to balance The balanced budget amendment’s parte McCardle, which suggests that the budget without a constitutional supermajority provisions, whether the Congress has that jurisdiction. In my amendment. But it is also said that three-fifths number of the whole num- legal judgment, that case is not valid you can learn from history. Mr. Presi- ber of each House of Congress [sec. 1 for any matter which is current today. dent, if the past 26 years have taught waiver to allow outlays to exceed re- I believe that it is very unwise for us anything, it is that Congress and the ceipts; sec. 2 waiver to increase the the Congress to have legislative au- President are unwilling and unable to limit on the debt], or the ‘‘constitu- thority to take away the jurisdiction balance the budget absent a force tional majority’’ provisions—a major- of the Supreme Court of the United greater than politics. That force is the ity of the whole number of each Constitution of the United States. House—[sec. 4 requirement to raise rev- States, for example, on a first amend- If the states ratify this amendment, enue; sec. 5 requirement to waive ment issue. That was a matter which Congress will be beholden to a law with amendment when the U.S. is involved was discussed extensively during the as much weight as the original Bill of in a military action that is a threat to confirmation proceedings of Chief Jus- Rights. Congress will be prohibited national security]—would work the tice Rehnquist, when after some dis- from ignoring annual deficits. We will same way as the Constitution’s other cussion Chief Justice Rehnquist con- be compelled by law to act. Each of us supermajority provisions. cluded that the Congress would not in this Chamber will have a duty to fol- Because these ‘‘supermajority’’ votes have the authority to take away the low our solemn oaths of office to up- require a supermajority vote of the jurisdiction of the Federal courts on a hold and protect the Constitution. ‘‘whole number of each House of Con- matter involving the first amendment. When we pass this measure, we will be gress,’’ and it is clear that the Vice When we got to other amendments, the beholden to following through on that President is not a member of either fourth amendment, fifth amendment oath. House, these provisions, like the two- and sixth amendment, Chief Justice Mr. President, today we can make thirds vote in the Senate for treaties, Rehnquist would not give the same re- history. Today, we should make his- are exceptions to the simple majority sponse, nor would he respond to the dif- tory. We can make history by molding vote general rule that the Vice Presi- ference of the authority of Congress to a better, brighter future for the next dent may vote in cases of a tie in the take away jurisdiction of the first generation and for every generation Senate. amendment contrasted with the fourth, thereafter. I hope today we will make Moreover, the Vice President would fifth or sixth amendments. not have a vote because these super- the right kind of history, and chart a I give that very brief review to sug- majority provisions would mandate new course for America, one where bal- gest that there may well be a question that a tie-vote would be meaningless. anced budgets and fiscal responsibility as to whether the Congress, through For instance, 60 votes in the Senate become the norm, and not the excep- enabling legislation, could take away would be required to raise the debt tion to the rule. the jurisdiction of the courts to inter- ceiling—where three-fifths is required VICE PRESIDENT AND BALANCED BUDGET vene on a controversy arising out of under section 2 of the amendment, and AMENDMENT this balanced budget amendment. It is 51 votes would be needed to raise taxes, Mr. HATCH. Mr. President, the issue as required by section 4. my hope that we will yet address that arises as to how House Joint Resolu- Mr. SPECTER. Mr. President, I have issue within the confines of the amend- tion 1 effects the obligations of the sought recognition to comment briefly ment itself. It may well be that critical Vice President, as President of the on the issue of the potential issue of votes necessary to pass the balanced Senate, to vote in case of a tie vote in the jurisdiction of the Federal courts budget amendment will depend upon the Senate. to decide matters under the constitu- our ability to find a way to satisfy Article I, section 3 of the Constitu- tional amendment for a balanced budg- those Senators. I believe that it is so tion provides that the ‘‘Vice President et if it is passed and ratified. I think it important to pass the constitutional shall be President of the Senate, but is important that courts not have ju- amendment for a balanced budget that shall have no Vote, unless they be risdiction to intervene in any con- I continue to support the amendment, equally divided.’’ By the plain meaning troversy where the issue is the raising even though an amendment offered to of this provision, the Vice President is of taxes or the cutting of expenses, the constitutional amendment for a not a Member of the Senate; he is which would be the issues under the balanced budget failed in an effort to merely the presiding officer—President balanced budget amendment, because put within the balanced budget amend- of the Senate—a neutral umpire, and, it is not a judicial function. ment itself a prohibition of Federal thus, cannot vote or take part in the I think the preferable course is to court jurisdiction. It gets sort of com- deliberations of the Senate. The only have within the body of the amend- plicated when we talk about it, Mr. exception to this is where there exists ment itself a flat statement that the President. a tie vote. In that case, to ‘‘secure at Federal courts—no courts—would have I think the factors are clear. I think all times the possibility of a definitive jurisdiction over any controversy aris- that our legislative history is clear. resolution of the body, it is necessary ing out of the balanced budget amend- Aside from putting in a prohibition of that the [Vice President] should have ment. Federal court jurisdiction, our legisla- only a casting vote.’’ The Federalist No. We have seen in a case originating in tive history is clear that it is congres- 68 (Hamilton). Kansas City, MO, the State of the dis- But the situation where the Vice sional intent on the balanced budget tinguished Presiding Officer, a situa- amendment that the Federal courts President can break a tie vote only ap- tion where the courts actually ordered plies to a simple majority vote, the should not have jurisdiction. But even the imposition of taxes which, in my the question of congressional intent is run-of-the-mill ordinary vote of the view, is not in any conceivable regard a a muddy field, with some Justices—no- Senate. Where the Constitution, how- judicial function. If there is any core tably, Justice Scalia—saying he will ever, provides for a ‘‘supermajority’’ legislative function, it is the raising of not look to congressional intent but vote, in situations where the Framers taxes. We elected officials are respon- only to the body of the language itself. of the Constitution feared the passions sible to our constituents, and that is a of majority rule would retard reasoned core legislative function. But it hap- So I will conclude by saying that I deliberation, there really is no occa- pened and it was upheld by the Su- hope we have made it clear as a matter sion for a tie vote and therefore the preme Court of the United States in of Senate intent, congressional intent, Vice President may not vote. the celebrated 5-to-4 decision a few that the courts should not have juris- These include the two-thirds vote re- years ago. diction over any controversy under the quirement of each House to override a There is a major issue as to whether balanced budget amendment, and with veto; the two-thirds vote requirement the Congress has the authority, the extra hope that we may make it

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00075 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3214 CONGRESSIONAL RECORD — SENATE February 27, 1995 plain in the body of the amendment national product, and, so long as this ratio sity; Dr. Michael R. Darby, U.C.L.A.; Dr. itself before we conclude. does not increase, all is well. This argument Otto A. Davis, Carnegie Mellon University; I yield the floor. is totally untenable because it ignores the Dr. Ted E. Day, University of Texas—Dallas; Mr. SARBANES addressed the Chair. effects of both inflation and real economic Dr. Louis De Alessi, University of Miami; The PRESIDING OFFICER. The Sen- growth. So long as government debt is de- Prof. Andrew R. Dick, U.C.L.A.; Dr. Tom nominated in dollars, sufficiently rapid in- Dilorenzo, Loyola College (MD); Mr. James ator from Maryland. flation can, for a short period, reduce the in- A. Dorn, Cato Institute; Mr. HATCH. Will the Senator yield terest burden substantially, in terms of the Dr. Aubrey Drewry, Birmingham Southern for just a unanimous-consent request? ratio to product. But surely default by way College; Dr. Gerald P. Dwyer, Jr., Clemson Mr. SARBANES. Yes. of inflation is the worst of all possible ways University; Dr. Robert B. Ekelund, Jr., Au- Mr. HATCH. Mr. President, I ask of dealing with the fiscal crisis that the def- burn University; Dr. Peter S. Elek, Villanova unanimous consent that ‘‘A Balanced icit regime represents. University; Dr. Jerry Ellig, George Mason Budget Amendment,’’ an open letter to Opponents also often suggest that Congress University; Dr. John M. Ellis, University of Congress from all kinds of economists, and the Executive must maintain the budg- California; Dr. Kenneth G. Elzinga, Univer- doctors of economics, be printed in the etary flexibility to respond to emergency sity of Virginia; Dr. David Emanuel, Univer- needs for expanding rates of spending. This sity of Texas-Dallas; Dr. David J. Faulds, RECORD. And I also ask unanimous con- prospect is fully recognized, and the Bal- University of Louisville; Mr. Richard A. sent that a column by William Safire anced Budget Amendment includes a provi- Ford, Free Market Foundation; Dr. Andrew on this matter also be printed in the sion that allows for approval of debt or defi- W. Foshee, McNeese University; RECORD. cits by a three-fifths vote of those elected to Dr. William J. Frazer, University of Flor- There being no objection, the mate- each house of Congress. ida; Dr. Eirik G. Furuboth, University of rial was ordered to be printed in the When all is said and done, there is no ra- Texas-Arlington; Dr. Lowell Galloway, Ohio RECORD, as follows: tional argument against the Balanced Budg- State University; Dr. David E. R. Gay, Uni- et Amendment. Simple observation of the versity of Arkansas; Dr. Martin S. Geisel, BALANCED BUDGET AMENDMENT—AN OPEN fiscal record of recent years tells us that the LETTER TO CONGRESS, FEBRUARY 1995 Vanderbilt University; Dr. Fred R. Glahe, procedures through which fiscal choices are University of Colorado; Dr. Paul Goelz, St. It is time to acknowledge that mere stat- made are not working. The problem is not Mary’s University; Dr. Robert Gnell, Indiana utes that purport to control federal spending one that involves the wrong political leaders State University; Mr. John C. Goodman, Na- or deficits have failed. It is time to adopt or the wrong parties. The problem is one tional Center for Policy Analysis; Dr. Ken- constitutional control through a Balanced where those whom we elect are required to neth V. Greene, S.U.N.Y.—Binghamton; Budget Amendment. In supporting such an function under the wrong set of rules, the Dr. Paul Gregory, University of Houston; amendment, Congress can control its spend- wrong procedures. It is high time to get our Dr. Gerald Gunderson, Trinity College; Dr. ing proclivities by setting up control ma- fiscal house in order. James Gwartney, Florida State University; chinery external to its own internal oper- We can only imagine the increase in inves- Dr. Claire H. Hammond, Wake Forest Uni- ations, machinery that will not be so easily tor and business confidence, both domestic versity; Dr. Daniel J. Hammond, Wake For- neglected and abandoned. and foreign, that enactment of a Balanced Why do we need the Balanced Budget est University; Dr. Ronald W. Hanson, Uni- Budget Amendment would produce. Perhaps versity of Rochester; Dr. David R. Hender- Amendment now, when no such constitu- even more importantly, we could all regain tional provision existed for two centuries? son, Hoover Institution; Dr. Robert Herbert, confidence in ourselves, as a free people Auburn University; Dr. A. James Heins, Uni- The answer is clear. Up until recent decades, under responsible constitutional govern- the principle that government should bal- versity of Illinois; Dr. John Heinke, Santa ment. Clara University; ance its budget in peacetime was, indeed, a Dr. Burton A. Abrams, University of Dela- Dr. Alan Heslop, Claremont McKenna Col- part of our effective constitution, even if not ware; Dr. Ogden Allsbrook, Jr., University of lege; Dr. Robert Higgs, Independent Insti- formally written down. Before the Keynes- Georgia; Dr. Robert Andelson (Ret), Auburn tute; Dr. P.J. Hill, Wheaton College; Dr. ian-inspired shift in thinking about fiscal University; Dr. Annelise Anderson, Stanford Mark Hirschey, University of Kansas; Dr. matters, it was universally considered im- University; Dr. Terry L. Anderson, Political Bradley K. Hobbs, Bellarmine College; Dr. moral to incur debts, except in periods of Economy Research Center; Dr. Richard Ault, Randall Holcombe, Florida State University; emergency (wars or major depressions). We Auburn University; Dr. Charles Baird, Cali- Dr. Steven Horwitz, St. Lawrence Univer- have lost the moral sense of fiscal responsi- fornia State University—Hayward; Dr. sity; Dr. Doug Houston, University of Kan- bility that served to make formal constitu- Charles Baker, Northeastern University; Dr. sas; Dr. David A. Huettner, University of tional constraints unnecessary. We cannot Doug Bandow, Cato Institute; Dr. Eric C. Oklahoma; Dr. William J. Hunter, Marquette legislate a change in political morality, we Banfield, Lake Forest Graduate School of University; can put formal constitutional constraints Management; into place. Dr. Andy Barnett, Auburn University; Dr. Dr. Thomas Ireland, University of Mis- The effects of the Balanced Budget Amend- Carl P. Bauer, Harper College; Dr. Joe Bell, souri; Dr. Jesse M. Jackson, Jr., San Jose ment would be both real and symbolic. Elect- SW Missouri State; Dr. James Bennett, State University; Dr. Gregg A. Jarrell, Uni- ed politicians would be required to make fis- George Mason University; Dr. Bruce L. Ben- versity of Rochester; Dr. Thomas Johnson, cal choices within meaningfully-constructed son, Florida State University; Dr. John Ber- North Carolina State University; Dr. David boundaries; they would be required to weigh thoud, National Taxpayers Union; Dr. Mi- L. Kaserman, Auburn University; Dr. Robert predicted benefits against predicted tax chael Block, University of Arizona; Dr. Kleiman, Oakland University; Dr. David costs. They would be forced to behave David Boaz, Cato Institute; Dr. Peter J. Klingaman, Ohio University; Dr. W.F. ‘‘responsibily,’’ as this word is understood by Boettke, New York University; Dr. Jeffrey Kiesner, Loyola Marymount University; Dr. the citizenry, and knowledge of this fact Boeyink, Tax Education Foundation; David Kreutzer, James Madison University; would do much to restore the confidence of Dr. Cecil Bohanon, Ball State University; Dr. Michael Kurth, McNeese State Univer- citizens in governmental processes. Dr. Donald J. Boudreaux, Clemson Univer- sity; Dr. David N. Laband, Auburn Univer- It is important to recognize that the Bal- sity; Dr. Samuel Bostaph, University of Dal- sity; anced Budget Amendment imposes proce- las; Dr. Dennis Brennen, Harper College; Dr. Dr. Everett Ladd, University Connecticut; dural constraints on the making of budg- Charles Britton, University of Arkansas; Dr. Dr. Harry Landreth, Centre College; Dr. etary choices. It does not take away the Eric Brodin, Foundation for International Stanley Leibowitz, University of Texas—Dal- power of the Congress to spend or tax. The Studies; Dr. Richard C.K. Burdekin, Clare- las; Dr. Dwight Lee, University of Georgia; amendment requires only that the Congress mont McKenna College; Prof. M.L. Dr. David Levy, George Mason University; and the Executive spend no more than what Burnstein, York University; Dr. Henry But- Dr. Dennis Logue, Dartmouth College; Dr. they collect in taxes. In its simplest terms, ler, University of Kansas; Mr. Ian Calkins, Robert F. Lusch, University of Oklahoma; such an amendment amounts to little more American Legislative Exchange Council; Dr. R. Ashley Lyman, University of Idaho; than ‘‘honesty in budgeting.’’ Dr. W. Glenn Campbell, Hoover Institute; Dr. Jonathon Macey, Cornell University; Dr. Of course, we always pay for what we spend Dr. Keith W. Chauvin, University of Kansas; Yuri Maltsev, Carthage College; through government, as anywhere else. But Dr. Betty Chu, San Jose State University; Dr. Alan B. Mandelstamm, Roanoke, Vir- those who pay for the government spending Dr. Will Clark, University of Oklahoma; Dr. ginia; Dr. George Marotta, Hoover Institute; that is financed by borrowing are taxpayers J.R. Clarkson, University of Tennessee; Dr. Dr. J. Stanley Marshall, The James Madison in future years, those who must pay taxes to Kenneth Clarkson, University of Miami; Dr. Institute; Dr. Merrill Mathews, Jr., National meet the ever-mounting interest obligations J. Paul Combs, Appalachian State Univer- Center for Policy Analysis; Dr. Richard B. that are already far too large an item in the sity; Dr. John Conant, Indiana State Univer- Mauke, Tufts University; Dr. Margaret N. federal budget. The immorality of the sity; Dr. John F. Cooper, Rhodes College; Mr. Maxey, University of Texas—Austin; Dr. intergenerational transfer that deficit fi- Wendell Cox, American Legislative Exchange Thomas H. Mayor, University of Houston; nancing represents cries out for correction. Council; Dr. Paul W. McAvoy, Yale University School Some opponents of the Balanced Budget Dr. Mark Crain, George Mason University; of Management; Dr. Robert McCormick, Amendment argue that the interest burden Dr. Ward Curran, Trinity College; Dr. Clemson University; Dr. Paul McCracken, should be measured in terms of percentage of Coldwell Daniel II, Memphis State Univer- University of Michigan;

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00076 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3215 Dr. Myra J. McCrickard, Bellarmine Col- University of Arizona; Dr. Norman Ture, In- are Senators Byron Dorgan and Kent Conrad. lege; Dr. J. Houston McCulloch, Ohio State stitute for Research on the Economics of Never has so much of the nation’s future University; Dr. Robert W. McGee, Seton Hall Taxation; Dr. Jon G. Udell, University of rested on the decision of two guys from University; Dr. Mark Meador, Loyola College Wisconsin; North Dakota. (MD); Dr. Roger Meiners, Clemson Univer- Dr. Hendrik Van den Berg, University of Another potential savior of liberal spend- sity; Dr. Lloyd J. Mercer, University of Cali- Nebraska; Dr. T. Norman Van Cott, Ball ers is Sam Nunn of Georgia who wants iron- fornia; Dr. Richard Milam, Appalachian State University; Dr. Charles D. Van Eaton, clad guarantees that the amendment will not State University; Dr. Dennis D. Miller, Bald- Hillside College; Dr. Richard Vedder, Ohio be enforceable in court, lest some Federal win Wallace College; Dr. Stephen Moore, University; Dr. George Viksnins, Georgetown judge wind up as de facto budget director. Cato Institute; Dr. John Moore, George University; Dr. Richard Wagner, George But an unenforceable law would mock the Mason University; Mason University; Dr. Stephen J.K. Walters, Constitution. Let the legislative history Dr. John Moorhouse, Wake Forest Univer- Loyola College (MD); Dr. Alan R. Waters, show that in the event of imbalance, the sity; Dr. Laurence Moss, Babson College; Mr. California State University; Dr. John T. Congress and the states intend any judicial Bob Morrison, Tax Education Support Orga- Wenders, University of Idaho; Mr. Brian S. injunction to apply to all spending and tax- nization; Dr. Timothy Muris, George Mason Wesbury, Joint Economic Committee; Dr. ing as a lump, with no discretion left to University; Dr. J. Carter Murphy, Southern Allen J. Wilkins, Marshall University; Dr. judges to choose which spending to cut. If Methodist University; Dr. Gerald Musgrove, James F. Willis, San Jose State University; enjoined by the court from running a red-ink Economics America; Dr. Ramon Myers, Dr. Gene Wunder, Washburn University; Dr. government at all the Congress would be Stanford University; Dr. Michael Nelson, Il- Bruce Yandle, Clemson University; Dr. forced to do its duty and balance the budget. linois State University; Dr. William A. Jerrold Zimmerman, University of Roch- A few points for the gentlemen from North Niskanen, Cato Institute; Dr. Geoffrey Nunn, ester. Dakota: San Jose State University; Dr. M. Barry O’Brien, Francis Marion Uni- [From the Essay] 1. By voting yes, they would empower the versity; Dr. David Olson, Olson Research people back home (including North Dakotans BALANCE THAT BUDGET Company; Dr. Dale K. Osborne, University of and Georgians) to join in deciding this great Texas—Dallas; Dr. Allen M. Parkman, Uni- (By William Safire) question; 75 percent of the states must vote versity of Mexico; Dr. E. C. Pasour, Jr., Back in 1972, when the Federal budget to ratify or the amendment fails. North Carolina State University; Dr. Tim- reached $245 billion, Congress took a look at 2. If the pendulum of public opinion swings, othy Patton, Ambassador University; Dr. that year’s deficit—$15 billion—and decided a future generation can choose new taxes Judd W. Patton, Bellevue College; Dr. Sam the budget was out of control. over spending cuts as a means of balancing Peltzman, University of Chicago Graduate Wilbur Mills, chairman of House Ways and the nation’s accounts. There’s room for a School; Dr. Garry Petersen, Tax Research Means, took emergency action: he rammed shift back to activist government central- Analysis Center; Dr. Manfred O. Peterson, through a bill delegating to the President ized in Washington, if that’s what our chil- University of Nebraska; the power to cut the budget any way he dren want. Dr. Steve Pejovich, Texas A&M University; wanted when it exceeded $250 billion. 3. President Clinton has just surrendered Dr. Timothy Perri, Appalachian State Uni- President Nixon was ready, but the Senate to red ink. His own pusillanimous budget, versity; Dr. William S. Pierce, Case Western was not; in blocking that radical action, which makes not even the easy choices, help- Reserve University; Dr. Sally Pipes, Pacific which would have transferred more power lessly projects another trillion in debt—and Research Institute; Dr. Yeury-Nan Phiph, than the line-item veto, senators argued that that assumes his rosy economic projections San Jose State University; Dr. Rulon Pope, ‘‘there is no reason we cannot cut the budget come true. Brigham Young University; Dr. Robert deficit ourselves.’’ That last item is the crusher. Publicly Premus, Wright State University; Dr. Jan S. They failed. During the Carter Administra- bowing to personal and political defeat by Prybyla, Pennsylvania State University; Dr. tion, with national debt mounting, Virginia the deficit, Mr. Clinton has turned the budg- Alvin Rabushka, Stanford University; Dr. Senator Harry Byrd proposed an even more et helm over to Congress. That branch has Don Racheter, Central College; Draconian bill to balance the budget, and demonstrated how it needs to lash itself to Dr. Ed Rauchutt, Bellevue University; Dr. this one passed both houses and was signed the mast of the Constitution. Robert Reed, University of Oklahoma; Dr. into law. P.L. 95–435 stated: ‘‘Beginning with John Reid, Memphis State University; Dr. Fiscal Year 1981, the total budget outlays of The PRESIDING OFFICER. The Sen- Barrie Richardson, Centenary College; Dr. H. the Federal Government shall not exceed its ator from Maryland. Joseph Reitz, University of Kansas; Dr. receipts.’’ Mr. SARBANES. Mr. President, a James Rinehart, Francis Marion University; Brave words. Because subsequent laws con- good deal of the debate thus far has trol, the mere passage of a deficit budget for Dr. Mario Rizzo, New York University; Dr. failed to focus on what I regard as one Jerry Rohacek, University of Alaska; Dr. 1981 nullified the Byrd law. Then came the Simon Rottenberg, University of Massachu- Gramm-Rudman Act in the mid-80’s, sup- of the most important factors to be setts; Dr. Roy J. Ruffin, University of Hous- posedly imposing real fiscal discipline for considered as we address this amend- ton; Mr. John Rutledge, Rutledge & Com- our generation; all that remains of that pass ment to the Constitution—how the bal- pany Inc.; at self-restraint is Phil Gramm running for anced budget amendment might affect Dr. Anandi P. Sahu, Oakland University; President saying he told us so. the economy. What impact will the Dr. Thomas R. Saving, Texas A&M Univer- Thus is demonstrated that budget-bal- amendment have on jobs, on incomes, sity; Dr. Craig T. Schulman, University of ancing statutes are hot air, and our experi- and on the long-term standards of liv- Arkansas; Dr. Richard T. Seldon, University ence shows that all protestations about a of Virginia; Dr. Gerry Shelley, Appalachian ‘‘responsible’’ Congress someday balancing ing of the American people. State University; Dr. William Shughart II, the budget are groundless. It is my strongly held view that a University of Mississippi; Mr. William E. Meanwhile, the national debt has soared balanced budget amendment could, Simon, William E. Simon & Sons; Dr. Randy from a piddling $373 billion when Wilbur under certain economic circumstances, Simmons, Utah State University; Dr. Daniel Mills sought drastic action to $5 trillion cause significant harm to the economy. T. Slesnick, University of Texas—Austin; Dr. today. The interest we must pay on that debt Requiring a balanced budget in each Frank Slesnick, Bellarmine College; now exceeds all we spend on national de- and every year, as this proposed Dr. Daniel Slottje, Southern Methodist fense. University; Dr. Gene Smiley, Marquette Uni- Worse, from the perspective of the budget amendment requires, regardless of the versity; Dr. Barton Smith, University of our children will have to face, these are the economic situation, would hamper the Houston; Dr. Lowell Smith, Nichols College; good old days. Their tax dollars will be con- ability of the Federal Government to Mr. Robert Solt, Iowans for Tax Relief; Dr. sumed by paying interest on the deficits we lessen the impact of recessions. John Soper, John Caroll University; Dr. Mi- run today, leaving nothing for their own A balanced budget amendment would chael Sproul, U.C.L.A.; Dr. Richard Stroup, good life. They will condemn their parents’ make economic recessions more severe current profligacy as cruelly reckless. Montana State University; Dr. Michael P. than they might otherwise be. The rea- Sweeney, Bellarmine College; Prof. Ronald That’s why the Gingrich House has already Teeples, Claremont McKenna College; Dr. passed the Balanced Budget Amendment to son for that is that currently the Fed- Clifford Thies, University of Georgia; Dr. the Constitution as the centerpiece of its eral budget helps to lessen the impact Roy Thoman, West Texas State University; contract, and why four out of five Americans of recessions through what are called Dr. Henry Thompson, Auburn University; support its passage when the vote comes up automatic stabilizers. Dr. Mark Thornton, Auburn University; Dr. in the Dole Senate tomorrow. These automatic stabilizers allow Walter Thurman, North Carolina State Uni- A third of the Senators could block it; mi- spending to increase and revenue to versity; Dr. Richard Timberlake, University nority rule is still possible. of Georgia; Dr. Robert Tollison, George With all Republicans except Mark Hatfield fall during times of economic hardship. Mason University; Prof. George W. Trivoli, united behind the balancing amendment, and When the economy goes into a down- Jacksonville State University; Dr. Leo Troy, with most Democrats opposing such deficit turn, headed toward a recession, the Rutgers University; Dr. Gordon Tullock, demolition, key votes among the undecided automatic stabilizers start to work.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00077 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3216 CONGRESSIONAL RECORD — SENATE February 27, 1995 Spending on Federal Government pro- ment compensation rise when recessions lizers. You get direct income support grams, such as unemployment com- occur. The deficit necessarily rises. This through unemployment insurance, and pensation and food stamps, automati- budgetary behavior is a very important eco- you get a decrease in the tax burden as cally increase as the economy goes into nomic stabilizer. It helps sustain private in- a consequence of the economic slow- comes during recession and thus keeps sales, recession, as more people lose their employment and production better main- down. jobs and become eligible for these pro- tained than they otherwise would be. Now, had the balanced budget amend- ment been in effect, these income sta- grams. And he goes on to state: In addition, as people earn less bilizers would not have been available, money as a result of a recession, they The American economy in the postwar real disposable incomes of American years has been far more stable than it was pay less in taxes. The way our system between the Civil War and the Second World families would have been almost $100 is currently constructed, these changes War, even if we exclude the Great Depression billion lower, and the recession would in spending and taxes occur automati- from the comparison. In the period between have been much, much deeper. It is for cally. These automatic stabilizers re- the Civil War and the First World War, the this reason that an article in the New duce the damage done to the American American economy spent about half the time York Times only a few days ago said, economy and to American families by in expansion and half in contraction. and I quote its heading, ‘‘The Pitfalls the recession. In the period since 1946, the economy spent of a Balanced Budget, Dismantling a The balanced budget amendment 80 percent of the time expanding and only 20 Decades Old System for Softening Re- percent contracting. In the years after the would force the Government to raise Second World War, fluctuations in the Amer- cessions.’’ The article goes on to say, taxes and to cut spending in recessions, ican economy around its long-term growth and I quote it: at just the moment that raising taxes trend were only half as large as they were in If the amendment is enacted, the side ef- and cutting spending will do the most the period 1871 to 1914. Many people who fects would be huge. A system that has soft- harm to the economy and aggravate have studied the period, credit an important ened recessions since the 1930’s would be dis- the recession; in other words, it would part of the increased economic performance mantled. work directly counter to cushioning or to the automatic stabilizing characteristics And further on, the article states: ameliorating the impacts of the reces- of the Federal budget. The biggest risk is to the Nation’s auto- sion. Under the proposed constitutional matic stabilizers which have made recessions This chart shows the percent change amendment, this stabilizing force less severe than they were in the century be- in gross domestic product, beginning would be seriously threatened. The fore World War II. The stabilizers work this way: When the economy weakens, outlays back in the 1880’s and coming forward first year of a recession would turn an initially balanced budget into deficit, automatically rise for unemployment pay, to the present. Since World War II and food stamps, welfare and Medicaid. Simulta- the concept of automatic stabilizers we but under the proposed constitutional neously, as incomes fall, so do corporate and have lessened the severity of economic amendment, the Congress would be re- individual income tax payments. Both ele- downturns. As a consequence of the quired to bring the budget back into ments make more money available for economic downturn there was greater balance by large tax increases or spending, thus helping to pull the economy job loss and less revenue into the spending cuts imposed as the recession out of its slump. Treasury. There were also increased ex- was still underway. Now, we would run the risk, without penditures out of the Treasury for un- Of course, to do that would only the automatic stabilizers which help to employment insurance and for medical drive the recession downward and move offset the downturn, of putting the care and food stamps. The increased ex- the economy even deeper, deeper into economy back in the boom-and-bust penditures and loss of revenue allow a these valleys. cycle which was particularly marked in deficit to take place in an economic Let me just talk a little bit about the late 1800’s and through the first downturn and work to support incomes how the fiscal stabilizers work in terms half of this century and which prompt- and stimulate the economy. of keeping income up during an eco- ed the comments made by Charles In the post-World War II period, we nomic downturn. Schultze with respect to how we have have allowed that to happen without This chart illustrates how automatic managed to offset the economic trying to balance the budget in an eco- stabilizers work. downturns since the end of World War nomic downturn. Prior to World War II Between the second quarter of 1990 II. As he pointed out in his statement, we tried to balance the budget in an and the fourth quarter of 1991, real per- the American economy in the postwar economic downturn. President Hoover sonal income from all sources before years, post-World War II years, has did it before the Great Depression. taxes and without transfers fell by 2 been far more stable than it was be- Previously, when we tried to do this, percent. tween the Civil War and the Second the business cycle went through tre- In other words, we went into an eco- World War. And as he states, ‘‘Many mendous fluctuations. Prior to eco- nomic slowdown, and personal income people who have studied the period nomic stabilizers the growth in the began to decline. Transfer payments credit an important part of the im- economy would go from boom to bust. including unemployment insurance, proved economic performance to the We used to have very deep valleys of food stamps, and medical care increase. automatic stabilizing characteristics negative growth. In fact, during the These payments do not increase in- of the Federal budget.’’ Depression, we had 15-percent negative comes up to the level that they were Some of my colleagues have argued, growth. From 1929 to 1933 we had a 30- earning, but it gives them a percentage we can waive the amendment with 60 percent drop in our gross national of what they were earning so they are votes. I do not know of constitutional product, almost a one-third drop in not completely wiped out. They have principles that are waivable, but they gross national product. some income continuing to come in. say we will come along and we will get So prior to World War II, we had So as you start this deep decline in a 60-vote supermajority and we will these tremendous fluctuations, and in wages, families were able to keep up waive the requirement of an annual the postwar period, using the auto- their after-tax income and after-trans- balance in order to address the reces- matic stabilizers, we have been able to fer income. So these payments offset or sionary situation. effectively eliminate periods of nega- cushioned what was happening as a The difficulty with this is that the tive growth. We still have fluctuations, consequence of the recession. The rea- automatic stabilizers work automati- but they are much shallower and most son this happens is that Government cally, and they take effect imme- of them have taken place above the fiscal policy helps to stabilize incomes. diately. The stabilizers, which prevent positive growth line. During the 1990–92 recession family these deep fluctuations, begin as soon In fact, Charles Schultze, in testi- incomes before taxes and before any as the economy softens. They begin be- mony he gave concerning the balanced transfer income fell by $70 billion, but fore the economic downturn is gen- budget amendment said, and I quote their incomes after taxes and with the erally recognized. him: transfer income rose by $92 billion. So Various votes have been cited in the A balanced budget amendment would be we were able to cushion the economic Chamber by others who say, we took a bad economics. Federal revenues automati- downturn, and we did it because we got vote and extended the unemployment cally fall and expenditures for unemploy- income support from these fiscal stabi- insurance, and this vote passed by a

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00078 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3217 large majority, so clearly if we were ployment compensation, food stamps and amendment requires an annual bal- into difficulties, we will get the ma- welfare. ance; the outlays and the receipts must jorities necessary in order to waive the Such temporary increases in the deficit act be in balance. Between 1988 and 1991, as ‘‘automatic stabilizers,’’ offsetting some balanced budget amendment and run of the reduction in the purchasing power of substantial outlays were used to close the deficit to offset the recession. the private sector and cushioning the econo- insolvent thrifts and transfer their as- The first point I wish to make is that my’s slide. Moreover, they do so quickly and sets to the Resolution Trust Corpora- we have not always gotten those votes automatically, without the need for lengthy tion. As these assets have been sold in for the extension of unemployment in- debates about the state of the economy and recent years, they have begun to yield surance. In the 1982 recession, for ex- the appropriate policy response. a smaller but still sizable stream of net ample, there was a vote that failed to * * * * * revenue back to the Treasury. This get the 60-vote requirement. So it is A balanced budget amendment would kind of flexible response to a major na- not accurate to say that whenever the throw the automatic stabilizers into reverse. tional financial crisis would have been issue is presented, the Congress has al- Congress would be required to raise tax rates prevented by the year-by-year lockstep ways responded—and particularly not or cut spending programs in the face of a re- approach of the balanced budget cession to counteract temporary increases in responded in a timely fashion. the deficit. Rather than moderating the nor- amendment, which makes no account Second, those votes that people cite mal ups and downs of the business cycle, fis- for anticipated future receipts. are votes for a further extension of un- cal policy would be required to aggravate The amendment actually requires the employment insurance beyond what them. current outlays for deposit insurance the basic program provides by law. But That is exactly what used to happen be matched with current spending cuts the application of the fiscal stabilizers when we experienced the boom and or tax increases. This would produce a begins with the use of the basic pro- bust cycles prior to World War II, and strong downward pressure on the econ- gram. There is no vote taken here to when we talked about the panics, the omy because deposit insurance pay- institute the basic program. The basic great panic of 1893, and 1922, and 1929. ments do not add to current economic program begins automatically as the Mr. President, I ask unanimous con- activity. They replace moneys which economy slows down, and we rely upon sent that the article by Laura Tyson be depositors already considered as in the that basic program to cushion the eco- printed in the RECORD at the conclu- bank, while the offsetting cuts or taxes nomic downturn. sion of my remarks. would subtract for current activity. If the economic downturn is severe, The PRESIDING OFFICER (Mr. There was an interesting article that there is a necessity to extend the basic ABRAHAM). Without objection, it is so appeared in this morning’s paper enti- program. On that extension, it has on ordered. tled, ‘‘The High Cost of a Balanced occasion been approved by large votes (See exhibit 1.) Budget Amendment.’’ Mr. President, I and on other occasions not so ap- Mr. SARBANES. Mr. President, I ask unanimous consent that article ap- proved. want to address one other feature of pear in the RECORD at the conclusion of So it is not at all clear that the vote this proposal for a balanced budget my remarks. necessary to waive the amendment amendment. We do not have a capital The PRESIDING OFFICER. Without would be forthcoming, and in any event budget at the Federal level and there- objection, it is so ordered. it is crystal clear that the vote comes fore the analogy that is drawn, where (See exhibit 2.) very late in the day after we have al- people say the State and local govern- Mr. SARBANES. It is stated there: ready started on the downward slope. ments balance their budgets, why does Advocates of the Balanced Budget Amend- Therefore, our ability to check that the Federal Government not balance ment to the Constitution do not intend to downward movement to avoid these its budget—is completely false. Most jeopardize the life savings of America’s fami- kinds of fluctuations will be markedly States run deficits under the account- lies or threaten the stability of the nation’s limited under the balanced budget ing principles used to compute the Fed- banks. As written, however, the amendment amendment. We are inviting the pros- eral budget. States have balanced could do just that. pect of going from these fluctuations budget requirements but they have a What happens now is, as soon as you over the business cycle without the capital budget separate and apart, encounter a problem, the deposit insur- deep moves into negative growth back which they finance by borrowing. ance fund covers those deposits. But in to the very fluctuations that marked We had two Governors who testified order to do that, your outlays have to the economy in the century before the that having a balanced budget require- exceed your receipts in the year in post-World War II period. ment helped them maintain a good which you are making that coverage. This matter may seem somewhat far credit rating. Insurance claims are automatically removed because we have not had a The question was then, ‘‘Why do you paid as needed, regardless, under the great depression for a long, long time. need a good credit rating if you have to deficit. Under the amendment, if de- But I simply want to underscore that have a balanced budget?’’ posit insurance payment would cause a what these deep plunges into negative Of course the answer was they ex- deficit, might not those payments be growth represent very severe unem- pected to borrow in the future. In fact prohibited? ployment, the likes of which we have the Governors acknowledged that their During a severe economic downturn, the not seen in the post World War II pe- budget balance is required only on risk of bank failure is greatest. An economic riod: Very extensive business failures— their operating budget and that they downturn also produces (or exacerbates) fed- bankruptcies, farm foreclosures. So we make active use of a capital budget for eral budget deficits, as tax revenues decline which borrowing is permitted. Individ- and spending for programs such as unem- would be crippling our ability to ad- ployment compensation increases. At such a dress economic downturns. uals, of course, borrow. Most people could not buy a home or a car if they time, the government would lack the extra Laura Tyson, when she was the chair revenues it could need to cover the large of the President’s Council of Economic had to have an annually balanced budg- costs of rescuing depositors and the banking Advisers stated in an article entitled, et of the sort that this amendment re- system. Under current law, deposit insurance ‘‘It’s a Recipe For Economic Chaos’’: quires because they would not be able claims are automatically paid as needed, re- Continued progress on reducing the deficit to make a capital investment. It is pru- gardless of the deficit. Under amendment, if is sound economic policy, but a constitu- dent economics to make wise capital deposit insurance payments would cause a tional amendment requiring annual balance investments in your future and to de- deficit, might not those payments be prohib- of the federal budget is not. The fallacy in preciate the capital asset over its use- ited? the logic behind the balanced budget amend- ful life. So it is a very important question as ment begins with the premise that the size of Let me just turn to the question of we consider the amendment before us. the federal deficit is the result of conscious the failure of this amendment to dis- Furthermore, I have difficulty in un- policy decisions. This is only partly the case. tinguish between different types of derstanding under the amendment how, The pace of economic activity also plays an important role in determining the deficit. spending and the impact that those dif- with respect to both Social Security An economic slowdown automatically de- ferent types of spending would have on and unemployment compensation, we presses tax revenues and increases govern- fiscal policy. The first is deposit insur- would be able to use the balances that ment spending on such programs as unem- ance. It must be understood, this we build up in those trust funds in

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00079 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3218 CONGRESSIONAL RECORD — SENATE February 27, 1995 order to cover future years? How would economic downturns, we will again and other social safety net programs falls, we be able to expend those balances plunge our economy into the severe up and the deficit narrows. since by definition to do so your out- and down boom and bust cycles which A balanced budget amendment would throw the automatic stabilizers into reverse. lays would be exceeding your receipts we experienced consistently through Congress would be required to raise tax rates in that particular fiscal year. We re- our history. This is not hypothetical. or cut spending programs in the face of a re- gard that as wise policy. We build up This is not conjecture. This is what cession to counteract temporary increases in these surpluses in the instance of the happened. the deficit. Rather than moderating the nor- Social Security System in anticipation This chart only shows GDP back to mal ups and downs of the business cycle, fis- of retirement of the baby boom genera- the 1880’s, but we could have taken it cal policy would be required to aggravate tion, and with the unemployment sys- back farther, and it would have shown them. A simple example from recent economic tem we build them up during better the same severe up and down fluctua- history should serve as a cautionary tale. In economic times in order to pay bene- tions. We have been able to moderate fiscal year 1991, the economy’s unanticipated fits during recessions. those movements of the business cycle slowdown caused actual government spend- How would those surpluses be used in during the post-World War II period. ing for unemployment insurance and related the future when the baby boomers re- People have become accustomed to the items to exceed the budgeted amount by $6 tire or when the next recession hits more moderate business cycle. Many billion, and actual revenues to fall short of since you would have an excess of out- simply assume that somehow the busi- the budgeted amount by some $67 billion. In lays over revenues in the Social Secu- ness cycle will continue as it were. But a balanced-budget world, Congress would rity trust fund with respect to Social have been required to offset the resulting the business cycle remains with us. As shift of more than $70 billion in the deficit Security and in the unemployment in- the ups and downs prior to World War by a combination of tax hikes and spending surance trust fund with respect to un- II show, we have succeeded in amelio- cuts that by themselves would have sharply employment insurance? rating the business cycle, cushioning it worsened the economic downturn—resulting So this requirement of an annual bal- as it begins a downward path. So that in an additional loss of 11⁄4 percent of GDP ance between outlays and receipts fun- we have avoided the very deep plunges and 750,000 jobs. damentally undermines the economic that we previously had experienced. The version of the amendment passed by prudence associated with anticipatory These deep plunges represent economic the House has no special ‘‘escape clause’’ for budget. This is budgeting which we recessions—only the general provision that disaster for the country. They rep- the budget could be in deficit if three-fifths have done consistently, and I think resent unemployment, business bank- of both the House and Senate agree. This is wisely. We build up the funds in the ruptcies, and farm foreclosures, the a far cry from an automatic stabilizer. It is trust fund and spend them during dif- like of which we have not seen in the easy to imagine a well-organized minority in ficult times by anticipating the future post-World War II period. We almost either House of Congress holding this provi- expenditures. seem to take it for granted that these sion hostage to its particular political agen- Mr. President, the New York Times major declines will not occur. da. In a balanced-budget world—with fiscal today in an editorial entitled ‘‘Unbal- I am extremely apprehensive that the anced Amendment’’ addresses this policy enjoined to destabilize rather than balanced budget amendment will take stabilize the economy—all responsibility for point. I ask unanimous consent that us back to these days. I wanted to counteracting the economic effects of the the editorial be printed in the RECORD come tonight to sound this warning as business cycle would be placed at the door- at the conclusion of my remarks. to the potential impact of this bal- step of the Federal Reserve. The Fed could The PRESIDING OFFICER. Without anced budget amendment and how it attempt to meet this increased responsi- objection, it is so ordered. might affect our economy, how it bility by pushing interest rates down more (See exhibit 3.) might impact on jobs, on incomes, on aggressively when the economy softens and raising them more vigorously when it Mr. SARBANES. Mr. President, this the long-term standards of living of the editorial addresses this point of the strengthens. But there are several reasons American people, how it could cause why the Fed would not be able to moderate automatic stabilizers and our ability to significant harm to the economy be- avoid these very deep and severe eco- the ups and downs of the business cycle on cause it would not allow us to follow its own as well as it can with the help of the nomic downward plunges. policies which would avoid bringing automatic fiscal stabilizers. I quote the editorial: economic slowdown into recession and First, monetary policy affects the economy When the economy slows, tax revenues fall recession into depression. indirectly and with notoriously long lags, off and spending on unemployment insurance making it difficult to time the desired ef- and food stamps rises. The automatic rise in Mr. President, I yield the floor. fects with precision. By contrast, the auto- the deficit by triggering spending serves to EXHIBIT 1 matic stabilizers of fiscal policy swing into mitigate the slowdowns, but under the pro- [From the Washington Post, Feb. 7, 1995] action as soon as the economy begins to posed amendment Congress could easily turn IT’SARECIPE FOR ECONOMIC CHAOS slow, often well before the Federal Reserve a $1 million downturn into something worse. even recognizes the need for compensating (By Laura D’Andrea Tyson) Unless a three-fifths supermajority saves the action. day, Congress would have to raise taxes and Continued progress on reducing the deficit Second, the Fed could become handcuffed cut spending in a slow economy, the opposite is sound economic policy, but a constitu- in the event of a major recession—its scope of responsible stewardship. Take another un- tional amendment requiring annual balance for action limited by the fact that it an push intended consequence. When savings and of the federal budget is not. The fallacy in short-term interest rates no lower than zero, loans went bankrupt during the 1980’s, the the logic behind the balanced budget amend- and probably not even that low. By histor- Federal Government bailed out the deposi- ment begins with the premise that the size of ical standards, the spread between today’s tors with borrowed money, thereby pre- the federal deficit is the result of conscious short rates of 6 percent and zero leaves un- venting a banking panic. But under the pro- policy decisions. This is only partly the case. comfortably little room for maneuver. Be- posed amendment the government could not The pace of economic activity also plays an tween the middle of 1990 and the end of 1992, react instantly unless a supermajority in important role in determining the deficit. the Fed reduced the short-term interest rate Congress approved. An economic slowdown automatically de- it controls by a cumulative total of 51⁄4 per- Before people start saying we could presses tax revenues and increases govern- centage points. Even so, the economy sank ment spending on such programs as unem- into a recession from which it has only re- get a supermajority vote to waive the ployment compensation, food stamps and amendment, let me just remind them cently fully recovered—a recession whose se- welfare. verity was moderated by the very automatic of the extremely close votes that we Such temporary increases in the deficit act stabilizers of fiscal policy the balanced budg- had here on the floor of the Senate as ‘‘automatic stabilizers,’’ offsetting some et amendment would destroy. with respect to providing the funds to of the reduction in the purchasing power of Third, the more aggressive actions requires cover the closing out of the failed the private sector and cushioning the econo- of the Fed to limit the increase in the varia- S&L’s. my’s slide. Moreover, they do so quickly and bility of output and employment could actu- Mr. President, I regard the vote com- automatically, without the need for lengthy ally increase the volatility of financial mar- ing tomorrow as a critical vote for a debates about the state of the economy and kets—an ironic possibility, given that many the appropriate policy response. number of reasons, but in particular of the amendment’s proponents may well be- By the same token, when the economy lieve they are promoting financial stability. because I am extremely apprehensive strengthens again, the automatic stabilizers Finally, a balanced budget amendment that by eliminating our ability to con- work in the other direction: tax revenues would create an automatic and undesirable duct a rational fiscal policy to offset rise, spending for unemployment benefits link between interest rates and fiscal policy.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00080 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS February 27, 1995 CONGRESSIONAL RECORD — SENATE S3219

An unanticipated increase in interest rates would lack the extra revenues it could need EXHIBIT 3 would boost federal interest expense and to cover the large costs of rescuing deposi- UNBALANCED AMENDMENT thus the deficit. The balanced budget amend- tors and the banking system. Under current ment under consideration would require that law, deposit insurance claims are automati- Tomorrow’s vote in the Senate on the bal- such an unanticipated increase in the deficit cally paid as needed, regardless of the def- anced-budget amendment is crucial for the be offset within the fiscal year! icit. Under the amendment, if deposit insur- Republican agenda to chop Government pro- In other words, independent monetary pol- ance payments would cause a deficit, might grams into bits. The outcome is also crucial icy decisions by the Federal Reserve would not those payments be prohibited? Don’t for- to the nation because the pernicious amend- require immediate and painful budgetary ad- get that the measure would amend the Con- ment would do enormous fiscal damage. Pro- justments. Where would they come from? stitution, while deposit insurance and other ponents are alarmingly within three votes of Not from interest payments and not, with such guarantees are only statutes. winning. such short notice, from entitlement pro- American banking was not always pro- The core of the amendment would require grams. Rather they would have to come from tected. The Great Depression was so steep— the Government to balance its books unless either a tax increase or from cuts or possible the economy shrank almost 30 percent from three-fifths of the House and Senate vote to shutdowns in discretionary programs whose 1929 to 1933—in part because there was no de- run a deficit. To the wavering Democrats— funds had not yet been obligated. This is not posit insurance. Some lost all their savings. John Breaux of Louisiana, Sam Nunn of a sensible way to establish budgetary prior- A rumor that a bank was in trouble prompt- Georgia, Wendell Ford of Kentucky, and ities or maintain the healthy interaction and ed panic, with depositors rushing to with- Kent Conrad and Byron Dorgan of North Da- independence of monetary and fiscal policy. draw their savings. Even false rumors caused kota—here are five unassailable reasons to One of the great discoveries of modern eco- banks to collapse. vote no. nomics is the role that fiscal policy can play One of President Roosevelt’s first acts was Unnecessary.—Federal deficits have indeed in moderating the business cycle. Few if any to close the banks while Congress enacted been too high. That poses a threat that bor- members of the Senate about to vote on a deposit insurance. The banks reopened, citi- rowing will siphon savings away from pro- balanced budget amendment experienced the zens could redeposit their funds in safety and ductive private investments. tragic human costs of the Great Depression, the economic collapse ended. Deposit insur- But the fact that borrowing must be con- costs made more severe by President Herbert ance became the first and best economic sta- tained does not imply it ought to be elimi- Hoover’s well-intentioned but misguided ef- bilizer. It is one reason that no post-war re- nated—any more than family borrowing, to forts to balance the budget. Unfortunately, cession has shrunk the economy more than buy a house or pay college tuition, need be the huge deficits inherited from the last dec- 1 3 ⁄2 percent. eliminated. A prudent rule would keep Fed- ade of fiscal profligacy have rendered discre- Doesn’t the FDIC charge annual fees to eral debt growing less quickly than incomes. tionary changes in fiscal policy in response banks, building up large balances, which This rule would justify deficits of about $200 to the business cycle all but impossible. Now would automatically be available in a bank- billion a year, close to current levels. many of those responsible for the massive ing crisis? run-up in debt during the 1980s are leading Misleading.—Proponents claim the amend- Not after the amendment. It prohibits ment would protect future generations the charge to eliminate the automatic stabi- spending borrowed funds, Incredibly, it also lizers as well by voting for a balanced budget against ruinous interest payments. True, to- prohibits using accumulated savings; it re- day’s children will owe taxes when they grow amendment. quires that all federal spending in any fiscal Instead of undermining the government’s up to pay interest on Federal debt. But pro- year be covered by that year’s revenues. This ponents ignore the fact that the tax pay- ability to moderate the economy’s cyclical requirement is like telling a family to fi- fluctuations by passing such an amendment, ments will flow right back to these children nance a new house or a child’s college tui- as owners of Government bonds. why not simply make the hard choices and tion out of that year’s wages, no matter how Unenforceable.—Because key terms of the cast the courageous votes required to reduce much money the family has in the bank. In amendment—like outlays and receipts—are the deficit—the kind of hard choices and cou- this case, the amendment precludes a sudden undefined, Congress will be able to manipu- rageous votes delivered by members of the increase in deposit insurance payments if late and evade. Can Congress create inde- 103rd Congress when they passed the admin- that increase would cause federal spending pendent agencies or find other ways to spend istration’s $505 billion deficit reduction to exceed federal revenues in that year, no and borrow off the Government books? A package? matter how much the FDIC has ‘‘in the Senate committee has already written into bank.’’ the legislative record, used to guide future EXHIBIT 2 There are two possible ways out. First, court decisions, that the Tennessee Valley HIGH COST OF A BALANCED BUDGET Congress could raise taxes or cut other Authority would be exempt from the amend- AMENDMENT spending by enough to offset deposit insur- ment. It should take lawyers five minutes to (By Richard Kogan) ance costs. But the potential size of those stretch whatever ‘‘principle’’ guides that ex- payments shows why they could not be eas- Advocates of the Balanced Budget Amend- ception to scores of other Government pro- ily offset. The recent restructuring of the ment to the Constitution do not intend to grams. jeopardize the life savings of America’s fami- savings and loan industry required deposit insurance payments of $156 billion over four The amendment also fails to provide an en- lies or threaten the stability of the nation’s forcement mechanism. It might simply be- banks. As written, however, the amendment years, $66 billion in 1991 alone. And the gov- ernment’s deposit insurance guarantee cov- come an empty gesture or, worse yet, the could do just that. courts might step in to tell Congress how Currently, America’s savings are safe. The ers private savings of $2.7 trillion. These much it should tax and where it should Federal Deposit Insurance Corp. (FDIC) amounts are too large to be offset by a single spend. guarantees individual deposits in banks and year’s tax increases or spending cuts. thrift institutions up to $100,000 per account. Second, there is the escape hatch. By a Irrational.—Federal bookkeeping lumps Depositors rely on the U.S. government to three-fifths vote, Congress could choose to ordinary spending with long-term public in- keep its word, quickly and automatically; if pay deposit insurance and allow deficit vestments. Congress, forced by the amend- a bank goes broke, the government makes spending. But it is hardly automatic that ment to cut quickly, would go after hugely good on deposits. Deposit insurance claims Congress would respond in a timely manner expensive, though vitally important, invest- are enforceable in court. (or at all), even in a pending crisis. In Au- ments, such as scientific research, costly Now look at the Balanced Budget Amend- gust 1941 Congress barely mustered a major- laboratories and equipment, job training or ment. It begins, ‘‘Total outlays for any fiscal ity to extend the draft, even though Hitler other investments that would not produce year shall not exceed total receipts for that had already marched across half of Europe. benefits for years, if not decades. fiscal year, unless three-fifths of the whole In the current debate, neither the Senate nor Reckless.—When the economy slows, tax number of each House of Congress shall pro- the House could find a majority to write into revenues fall off and spending on unemploy- vide by law for a specific excess of outlays the amendment an exception for recessions. ment insurance and food stamps rises. This over receipts by a roll-call vote.’’ This decep- Finding three-fifths majorities in each House automatic rise in the deficit, by triggering tively simple concept—that the federal budg- of Congress is significantly more difficult. spending, serves to mitigate the slowdown. et must be balanced each year—would inad- By the time Congress fully understands the But under the proposed amendment, Con- vertently cast doubt over the ‘‘full faith and scope of a developing banking crisis and gress could easily turn a mild downturn into credit’’ of the U.S. government, putting all gathers the three-fifths vote (if it can), the something worse. Unless a three-fifths super- federal guarantees, including deposit insur- problem would have grown, perhaps to a dan- majority saves the day, Congress would have ance, at risk. gerous degree. to raise taxes and cut spending in a slow Here’s why. During a severe economic Taking the amendment at face value, then, economy—the opposite of responsible stew- downturn, the risk of bank failure is great- legal commitments made by the U.S. govern- ardship. est. An economic downturn also produces (or ment would no longer be binding. When eco- Take another unintended consequence. exacerbates) federal budget deficits, as tax nomic troubles arose and the banking sys- When savings and loans went bankrupt dur- revenues decline and spending for programs tem, depositors and the economy as whole ing the 1980’s, the Federal Government such as unemployment compensation in- most needed it, those ‘‘commitments’’ could bailed out depositors with borrowed money, creases. At such a time, the government prove ephemeral. thereby preventing a banking panic. But

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00081 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS S3220 CONGRESSIONAL RECORD — SENATE February 27, 1995 under the proposed amendment, the Govern- recession for three decades? Have we Dixon, to solely conduct the evalua- ment could not react instantly unless a avoided the business cycle for three tions of the Secretary’s list, or do we supermajority in Congress approved. decades? No. We have had numerous provide him with the assistance of The balanced-budget amendment appeals to taxpayers who demand that the Govern- business cycles since 1969 but have only these six Commissioners? ment spend their money wisely. But Sen- balanced the budget once. If critics are I have no doubt that despite the ators Nunn, Ford, Conrad, Dorgan and right, we should have had a cycle of abilities of Alan Dixon, he and the Sen- Breaux need to recognize that this honorable deficits and surpluses. Far from cy- ate would rather see a group of individ- sentiment cannot be wisely embedded into cling, the debt is on a steady increase. uals make decisions on the future of the Constitution. The debt is growing at a fantastic rate: the Nation’s military bases and our Mr. HATCH. Mr. President, critics or it is now over $4.8 billion and is pro- local economies. Therefore, I urge the outright opponents of the balanced jected to exceed $6 trillion in only 3 Senate to confirm these nominations budget amendment have made the years. The correlation between deficits and let the 1995 Base Closure Commis- point that one reason we should not and prosperity is far from clear, based sion proceed with its work. have a balanced budget rule is because on our history. f of how the business cycle and the so- I have other questions about this ar- CONFIRMATION OF AL CORNELLA called automatic stabilizers work. The gument. At the level we are now spend- basic idea is that in recessions, reve- ing, about $1.5 trillion each year, just Mr. PRESSLER. Mr. President, I rise nues decrease and outlays—such as how big of a deficit would we have to today to express my strong support for welfare payments—increase. Critics run to stimulate the economy? We al- the nomination of Al Cornella to be a say that economic fluctuations are as ready have our foot to the floor on the member of the 1995 Defense Base Clo- inevitable as the tides and hence so is debt accelerator—we cannot seriously sure and Realignment Commission. a cycle of deficits, therefore, com- argue that pushing our debts further This Commission was created by Con- manding budget balance is like order- will be helpful. Talk about inflexible gress in 1990 with the intention it ing the tides to retreat. fiscal policy. Our debt and yearly defi- would be an independent, nonpartisan The notion that ordering budget bal- cits are so large there just is not any decision-making body. I can assure my ance is like commanding the tides to clear room to move further. We would colleagues, Al Cornella is a man of the retreat is absurd. It is like saying it is have more flexible fiscal policy if we highest integrity. He will be fair in his impossible to stop using your credit got our deficits under control. deliberations and recommendations. cards. The truth is that taxing and Mr. President, the principle of a rule During his opening statement before spending decisions are volitional, not- of balanced budgets is unassailable, the Senate Armed Services Committee, withstanding decades of bad habits. and should be violated only when abso- Al committed himself to conducting Economic fluctuations which result lutely necessary. his deliberations in a fair and impar- in changes in revenue or outlay projec- f tial manner. Al Cornella is a man who tions are not an argument against bal- keeps his word. The law requires the ance, but could an argument for sur- MORNING BUSINESS Commission to make recommendations plus contingency funds. It is decidedly based on specific criteria, ranging from not an argument for maintaining large military readiness to fiscal cost. Al SUPPORTING THE CONFIRMATION structural deficits. A family saves for a Cornella’s deliberations will be fully OF THE NOMINEES TO THE BASE rainy day, they do not keep their cred- consistent with the law. CLOSURE AND REALIGNMENT it cards ‘‘maxed out’’—in good times Mr. President, I am confident in Al’s COMMISSION and bad—and then tell the credit com- character and trust his judgment. Al pany that economic fluctuations are as Mr. THURMOND. Mr. President, I Cornella exemplifies the American inevitable as the tides so how about an- will not take much of the Senate’s spirit of community involvement. He is other few thousand on the credit limit. time to express my support for the con- one of South Dakota’s very best. Cur- The balanced budget amendment in firmation of Mrs. Cox, General Davis, rently, Al is a small business owner in no way prevents us from running a Admiral Montoya, Mr. Kling, Mr. Rapid City, SD, and has served as small surplus, which could be used to Cornella, and Mrs. Steele to be mem- chairman of the board of the Rapid offset the effects of an economic down- bers of the Base Closure and Realign- City Area Chamber of Commerce. turn. In fact, Fred Bergston, a noted ment Commission. In addition to his civic involvement, economist and former Treasury De- Despite the dismal performance by Al has a strong interest in and knowl- partment official, suggests we create a the White House when it submitted edge of military issues. He served in habit of saving for rainy days, which these nominations, the Armed Services the U.S. Navy during the Vietnam con- will allow us to use fiscal policy within Committee resolved all outstanding flict. Being a Vietnam veteran myself the balanced budget rule better than issues concerning individual nominees. as a lieutenant in the U.S. Army, I we can now without it. I should add that these issues were, for strongly believe his commitment to The argument made by the Senator the most part, related to whether or duty and country should not go unno- from Maryland seems to be a distorted not an individual should recuse himself ticed. For many years, Al served as a version of Keynsianism, and it is not or herself from deliberating on a par- key leader in issues concerning mili- clear that it would work to stimulate ticular base. After considerable discus- tary affairs in the Rapid City Chamber our current economy. In fact, our re- sion and individual interviews, these of Commerce. For the past 3 years, Al cent history seems to refute such an concerns were alleviated and the com- has served as a member of my Service expectation. In the early 1990’s, we had mittee recommended that the Senate Academy Advisory Board, evaluating record deficits and zero or low growth confirm the nominees. applicants seeking admission to our for 3 years. The experience of the late We now face a crucial decision. To- three military academies. Bush, early Clinton, years was the ex- morrow, as required by law, the Sec- Again, Mr. President, Al Cornella is a perience of the Carter years, namely retary of Defense will release his rec- man of integrity. I urge my colleagues high deficits and recession. This sort of ommended list of bases for closure. to support his confirmation. Al stimulus mechanism obviously does Whether or not the Senate confirms Cornella has distinguished himself in not work very well. Additionally, Mr. the Base Closure Commissioners has no every endeavor in his life. He will do so President, President Clinton’s response impact on the release of the list. How- again as a member of the Defense Base to the recession of the early 1990’s was ever, it does impact on the deliberative Closure and Realignment Commission. to send a budget with tax increases and process which will proceed since we f spending cuts. This was supported by have a Commission chairman. The the Senator from Maryland. Why was question that every Senator who wants MESSAGES FROM THE PRESIDENT this plan appropriate in 1993 but appar- to delay the confirmation process Messages from the President of the ently no other time? should be asking is: Do we allow the United States were communicated to Moreover, we have been running defi- chairman of the Base Closure and Re- the Senate by Mr. Thomas, one of his cits for three decades. Have we been in alignment Commission, Senator Alan secretaries.

VerDate Aug 31 2005 04:24 May 28, 2008 Jkt 041999 PO 00000 Frm 00082 Fmt 0624 Sfmt 0634 J:\ODA15\1995_F~1\S27FE5.REC S27FE5 mmaher on MIKETEMP with SOCIAL SECURITY NUMBERS