Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, this amendment does undermine the basis of Medicaid today, which is ``medically necessary services.'' The effect of this amendment is to allow States to lower health care coverage for low-income kids. That is the effect of this amendment. Why do States want more flexibility, especially with respect to this program? So basically they can lower benefits. They can save money. There has been a longstanding principle under Medicaid that Medicaid should provide medically necessary services, such as immunizations or checkups, to low-income kids, and that is the basis. We have to keep it. The effect of this amendment is to undermine that. If we stand for anything here, it is making sure low-income kids do not have less health care benefits, at least. They should have more. This amendment would undermine that and allow States to have lower benefits for kids, and for that reason it should be rejected.

Mr. BAUCUS

Mr. BAUCUS. Madam President, this amendment fails to distinguish between Part B premium and Part D. This amendment calls for means testing Part D. What does that honestly mean? It will create massive confusion among seniors. Why? The Government sets the Part B premium. The private sector sets the Part D drug premium. There are 1,500 plans and each of them is different. Some premiums are a few dollars, some are $100. You think seniors were confused with Part D when it first came out? That is a picnic compared to the confusion this amendment is going to create. Think of all the confusion the seniors are going to have to face, trying to figure out is their premium means tested compared to their friends' premium next door? This is massively complex for seniors. There is so much confusion for seniors that the amendment should not be agreed to. I urge Senators to vote against this confusion.

Mr. BAUCUS. Mr. President, we voted to affirm our commitment to the program. The amendment offered by the Senator from Texas undermines the current program. Many Senators want to expand the Children's Health Insurance Program. This undermines it. It reduces the current program and wreaks havoc with the States. They will lose their flexibility that they currently have in administering the program. It puts a huge financial burden also on States that otherwise want to provide resources for the kids in their States. I urge strongly we do not adopt the Cornyn amendment because it undermines the current program. It is a step backward, not forward.

Mr. BAUCUS. Mr. President, we can voice vote this as far as I am concerned. There was a request on my side. I don't know if there is anymore. I don't see anybody waving his hand or her hand, so it is fine with me.

Mr. BAUCUS. Mr. President, this amendment basically confirms our commitment to reauthorize the Children's Health Insurance Program by September 30. We have to get this authorized quickly. It is the statement of the Senate that we will do so; otherwise, we lose a large number of dollars. We lose about $25 billion from the budget baseline if we do not get this done. It will wreak financial havoc on States if we do not get this done. The program has reduced the rate of uninsured children by one-fifth. It is a great opportunity, frankly, for everyone in this body to say ``yes'' to kids. Yes, we are going to make sure our kids are covered with insurance. We are going to expand the Children's Health Insurance Program. I urge all Senators to vote yes.

Mr. BAUCUS. Mr. President, this request has been cleared with the two managers and the ranking members of the Finance Committee. I ask unanimous consent to modify my amendment No. 504 with the text I send to the desk.

Mr. BAUCUS. Thank you, Mr. President.

Mr. BAUCUS. Mr. President, the amendment sounds good. It is nice, bland language to provide participants with the benefits of savings and investment. But make no mistake about it, this is a stalking-horse for Social Security. That is what this is all about. The Senator offered virtually the same amendment last year, which had the same purpose, and it was defeated 46 to 53, I think. This is privatization of Social Security. The American people rejected that; they rejected private accounts. It would cause a huge increase in the Federal deficit, a massive transfer. This amendment is disguised but would do just that. It looks good on the surface, but this is an amendment to privatize Social Security, create private accounts for Social Security. Senators should not be fooled. Again, Senators rejected this very same amendment last year by a large vote of 46 to 53. It should be rejected this time as well.

Mr. BAUCUS. Mr. President, this amendment should be opposed very simply because the savings, the $34 billion the Senator from Texas prescribes, could not be used as offsets to help accommodate other programs. Let's take SCHIP, for example. Because the way the Senator's amendment is written, as reconciliation instructions, the $34 billion could not be offset. That would be straight deficit reduction. We are going to need, frankly, some wiggle room in Medicare programs to find revenue to pay for CHIP and for other Medicare adjustments. It makes no sense to straight cut $34 billion out of Medicare alone, in itself a deep cut, without some way of shoring up some of the needs we are going to have, especially SCHIP. I strongly oppose this amendment.

Mr. BAUCUS

Mr. BAUCUS. The estate tax provision.

Mr. BAUCUS. Mr. President, I thank my good friend from North Dakota, Senator Conrad. He has done a super job, almost impossible job putting this budget together. It is tough enough to get agreements in this body, and it is more difficult when it is a budget resolution. I compliment my colleagues on both sides of the aisle for their excellent and diligent work. I also say to him I appreciate his offer of an apology with respect to the misunderstanding and miscommunication. This Senator is probably as much a part of the miscommunication as anybody. Amendment No. 492

Mr. BAUCUS. Mr. President, I send an amendment to the desk and.

Mr. BAUCUS. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. BAUCUS. Mr. President, I again commend the chairman for his able work in bringing this budget to the floor. He has done a superb job. The budget resolution before us leaves a surplus of $132 billion in the year 2012. The amendment I now offer on behalf of Senators Landrieu, Pryor, Bayh, and Bill Nelson would state the Senate's will on what we should do if that surplus materializes. In sum, our amendment says that the Senate's highest priority for any surplus should be American families. Our amendment would put children first. It would take $15 billion out of that $132 billion and devote it to improving children's health care coverage under CHIP, the Children's Health Insurance Program. The budget resolution already recognizes this priority in a deficit-neutral reserve fund. Our amendment would also reduce the amount in that reserve fund. So we are not increasing the net amount of spending on CHIP. It will be the same. We are just making that work on CHIP more likely. We are saying if we have a surplus in 2012, then we ought to spend some part of that surplus on children's health, and we are saying if we have a surplus in 2012, we should not raise taxes to pay for all of the Children's Health Insurance Program. If we have a surplus in 2012, we should not cut Medicare to pay for all of CHIP. Rather, we should use some of that surplus to fund children's health; that is, put children first. Then our amendment takes the rest of the surplus and returns it to the hard-working American families who created it. Our amendment devotes the rest of the surplus to the extension and enhancement of tax relief for hard-working American families. Here are the types of tax relief about which we are talking. We are talking about making the 10-percent tax bracket permanent. That is a tax cut for all taxpayers. Obviously, if the 10-percent tax bracket is made permanent--that is, for all years--all taxpayers who pay income taxes, irrespective of their income, irrespective of their bracket, get a tax break. We are talking about extending the child tax credit. That provides a $1,000 tax credit per child. This tax credit recognizes a family's ability to pay taxes decreases as family size increases. Unless we act, the child tax credit will fall to $500 per child. Currently, it is at $1,000. The child tax credit should be made permanent. We need to recognize the financial responsibilities of childbearing. We are also talking about continuing the marriage penalty relief, which is a tax cut on which the American family has come to rely. It is going to continue. We know that. We should recognize that fact. Marriage penalty relief makes sure a married couple filing a joint return has the same combined tax liability as they would have if they were not married. We are also talking about enhancing the dependent care credit. Clearly, this credit is very important to working families. It recognizes the additional cost for raising children in this fast-paced society. We are talking about improving the adoption credit. The majority of adoptions cost over $20,000. This provision offers a credit of $10,000 for those willing to give a home to a needy child. We are talking about providing combat pay under the earned-income tax credit, otherwise known as the EITC. Under current law, income earned by a soldier in a combat zone is exempt from income tax. That is good. This actually, however, hurts low-income military personnel under the EITC. If not for the EITC combat pay exception, combat zone pay would not count as earned income for purposes of determining the credit. This amendment makes that exception permanent so that military families can get the full benefit of the EITC. We are talking about reforming the estate tax. We want to try to give American families certainty. We want to support America's small farmers and ranchers, and in this amendment, we have allowed room for estate tax reform that will do that. And we talk about returning surplus revenues to hard-working American families. That is what our amendment does. It is very simple, very straightforward. It says we should put America's kids and families first. It says if we have a surplus, these are the priorities it should be used for. I urge my colleagues to join me in supporting this amendment.

Mr. BAUCUS. Madam President, I believe this amendment should be adopted by every Senator because essentially it is saying if we have a surplus in 2012, as contemplated by the budget resolution, these are priorities all of us support. If these were before the Senate today as actual tax provisions--and they will be, I am sure, at some future date because the current tax cuts don't expire until 2010--that we will vote for them anyway because it is the right thing to do. Marriage penalty relief, child tax credit, the combat pay exception for soldiers, adoption credit, the 10-percent bracket--these are all provisions that are very important. The American public deserves them. I hope very much this amendment will be adopted by all Members because I think it is something all Members and all the citizens of our country support. I see the ranking member is on the floor. I would be interested in knowing the degree to which he enthusiastically supports the amendment.

Mr. BAUCUS. It is approximately $195 billion. It allocates the projected surplus that is in the budget resolution.

Mr. BAUCUS. That is a good question. The answer to that is essentially this is a 5-year budget resolution, so we want to balance the budget in 5 years, in 2012. But because the tax cuts that are mentioned in the amendment currently expire in 2010, the Senator raises the question about 2011, 2012. If I understand the import of the question of the ranking member of the Budget Committee, it is what happens in 2011.

Mr. BAUCUS. In the earlier years, 2010, there would be a deficit, but by the time we finish the 5 years, there would be a surplus. We have written this amendment in a way to prevent a yo-yo, on-off effect of the tax provisions. To make it perfectly perfect, so there is not a deficit in any year, 2010, 2011, or 2012, we can have the tax cuts go up or down, and so forth, but I think it is best for the American people not to have a yo-yo effect, not go up and down, but to extend across the board those provisions which are contained in the amendment at the end of the day would not be a deficit.

Mr. BAUCUS. It is true, in those years there is deficit spending, but it comes in balance in 2012.

Mr. BAUCUS. I think it is $194 billion for those 3 years 2010, 2011, 2012.

Mr. BAUCUS. Approximately.

Mr. BAUCUS. Sorry?

Mr. BAUCUS. No, we are back in balance by 2012 at the end of the 5- year period contemplated by this amendment. In the meantime, we are in deficit for the years 2010 and 2011.

Mr. BAUCUS. There is an underlying answer to all these questions; namely, these are questions the Finance Committee is going to address and find the appropriate offsets and deal with the pay-go when it comes up at that time. But essentially, education tuition tax credits are not provided for in this amendment, but are in the budget resolution.

Mr. BAUCUS. Section 179 expensing is not contemplated.