Thomas Coburn

Mr. COBURN

Mr. COBURN. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I would just add that the GAO reports the President's proposal to strengthen the hospital insurance program is more perceived than real. In realty, nothing about the program has changed. Mr. Chairman, I yield 1 minute to the gentleman from South Carolina (Mr. DeMint).

Mr. COBURN. Mr. Chairman, I yield 1 minute to the gentleman from Texas (Mr. Sam Johnson). (Mr. SAM JOHNSON of Texas asked and was given permission to revise and extend his remarks.)

Mr. COBURN

Mr. COBURN. Actually, the gentleman makes my point. We have not done as good a job as we should have. We should have restrained spending more. Let me spend a few minutes talking about the budget proposal of President Clinton and what has happened in 1999, and what has been projected. Then I want the gentleman from Minnesota (Mr. Gutknecht) to kind of talk on these budget items. The other thing we hear, and I hope we get some time to spend on it, is Medicare. I know a lot about Medicare because I interact with Medicare every day as a physician. I know the ins and outs of it. I know what is good about it and what is bad about it. The one thing I want the American public to know is the Congress, regardless of its politics, regardless of the rhetoric, nobody in Washington wants to do anything except enhance the viability of Medicare. What I want to do is go through the budget for 1999, which we are operating under right now. By the end of this year, the fiscal surplus on social security, the amount of money taken in versus the amount of money taken out, is expected to be $127 billion. If the government would have exercised fiscal discipline, we would have saved $126 billion. That is where this red line is. But we did not. Last year in the omnibus appropriations bill this Congress, over the threat of a government shutdown, spent $15 billion above what the budget caps had said we would spend in 1997, an agreement that the President agreed to and the Congress agreed to. They did not keep it. What happens? Instead of a $127 billion surplus, it became $111. Now the President wants to spend another $1 billion on foreign aid. That takes us down to $110 billion in terms of social security. We have a chance to have a real surplus this year because the revenues coming to the Federal Government, as the gentleman from South Carolina said, are rising. Why are they rising? It is called bracket creep. As people make more money, they move into a higher tax bracket, so therefore, the government takes more of our money. They reward us for working harder and earning more by taking a lot of that money away. What happens is the revenues to the Federal Government grow. If we take the President's budget, the Congressional Budget Office estimates there will be $138 billion more in social security coming in than is paid out. Our idea is to not spend any of that on anything but social security, to solve the problems associated with Medicare and social security; to not spend any of it, to save 100 percent of it. If we reject what the Republican budget plan is, the Congressional Budget Office anticipates right now that we will spend at least $5 billion of that $138 billion, bringing us down to only taking $5 billion out of the social security trust fund. We will only have $133 billion. If we take what the President has proposed under his budget proposal, we will take another $20 billion of that and spend it. Remember, we all agreed in 1997 that we are not going to spend above the caps. We already have $35 billion proposed spending above the caps. Finally, if we take the President's plan of saving 62 percent of the social security fund and spending 38 percent on new spending, what we get down to is actually, by all his plans, down to somewhere around 57 or 58 percent he wants to save. If something is wrong, it is wrong all the time. If it is wrong to take the social security trust fund, and what that means is lowering the standard of living for our children and grandchildren, and placing a tremendous increased burden on them from a tax standpoint, it is wrong now, it was wrong before, as we have seen from the gentleman from South Carolina's chart, and it is wrong for the future. There is no way we will ever solve this problem until we start being honest about what the word ``surplus'' means, until we start being honest about the social security trust fund, and we start being honest about the problems coming up with Medicare. Nobody is proposing that we spend this money on anything except social security. It is true that we will reduce external debt with that, but the total debt will not go up if we do not spend this money, so it is important that we have the restraint on spending. I yield to the gentleman from Minnesota (Mr. Gutknecht).

Mr. COBURN. Mr. Speaker, I want to spend just a minute here going over the present budgets, if we can.

Mr. COBURN. It is interesting to note 1.9 percent is not in terms of real rate of return, that is not an inflation adjusted number, because when you do an inflation adjusted number, you go to .6 percent. One last thing before the gentleman from South Carolina talks. I delivered 97 babies last year as a Member of Congress, and that is pure joy. But with that comes a heartache because I know that unless we change the environment in Washington that those children that I got to spank their back sides of and heard their first cry will never have the opportunity that my children had or I had as a youngster in this country. I yield to the gentleman from South Carolina.

Mr. COBURN. Mr. Speaker, in fact what we will do is make a determination of where we need to use that money. If it is shoring up Medicare, we will use it for shoring up Medicare. But I will remind the gentleman and the American people that we had a commission that gave great recommendations on Medicare and how to save it, and the President rejected his own commission on what to do. I think the gentleman has some things that are very important for us in discussing that in his charts.

Mr. COBURN. Youngster; are you not?

Mr. COBURN. Right.

Mr. COBURN. Mr. Speaker, one of the things I do with my seniors who are on Medicare, I have actually asked them this at home when the President started talking about a drug benefit, we are talking about here we go again, politicians adding a benefit to a program that we cannot afford now. When we ask the seniors, ``Do you want to increase the benefits associated with Medicare, and the way we are going to pay it is we are taking it away from your grandchildren,'' they uniformly say no. But they also will say, ``If you will spend wiser in Washington, maybe you can do more for me, because I am struggling.'' But they do not want their children and their grandchildren to have to pay for it. So I want to thank the gentleman from Minnesota (Mr. Gutknecht) and the gentleman from South Carolina (Mr. Sanford) for being here tonight. My purpose is not partisanship. My purpose is to make sure the American public knows that there are some of us here that are going to honestly talk about what the numbers are, honestly talk about being critical of both Republicans and Democrats in the past in terms of the mistakes that have been made that have been politically expedient. I want to close this tonight with a statement that Martin Luther King said in his last speech in the Washington Cathedral not long before he was assassinated. What he said was is that ``Vanity asked the question, is it popular? And cowardice asked the question, is it expedient? But conscience asked the question, is it right?'' The gentleman related to something, right versus wrong. For too long Washington has been asking the wrong question. What they have been saying is, is it popular, and is it expedient for my political career, versus is it right for our country, right for the future generation and the following? I hope the Congress will have the courage to do what is right rather than what is expedient and what is popular. That is what we are sent up here to do.

Mr. COBURN. Mr. Speaker, the difference is $150 billion.

Mr. COBURN. Mr. Speaker, what we are going to hear tomorrow, too, I think that is important in terms of Medicare, is that they want to take 15 percent of Social Security money and shift it over to Medicare. That may or may not be a good idea, but if we are going to preserve Social Security, the one way to do it is not to spend Social Security money on Medicare, because all we are going to do is undermine Social Security even further. President Clinton's own chairman, Senator Breaux, had this quote from the Wall Street Journal on March 12. ``I think what we have on the table is a classic Clinton New Democrat reform, but there are entrenched people within the White House who do not want any change.'' The fact is, if we are going to save Medicare, it is going to have to have some change. Politicians generally worry about changing something as important as Medicare. It takes real courage to solve the Medicare problem. But we have to change it if we are going to solve it. We can not solve it, and we can do the same thing to our children on Medicare as we have done on Social Security, and that is steal the money from somewhere else and then raise their taxes in the future. Mr. Speaker, I just yield to the gentleman from Minnesota (Mr. Gutknecht) on that point. I think he has a chart that talks about the amount of money that can be saved if we fiscally restrain spending.

Mr. COBURN. Mr. Speaker, we will come back to that in just a minute. I yield to the gentleman from California (Mr. Cunningham) to comment on this situation.

Mr. COBURN. Mr. Speaker, let me ask a question because the assumption in the partisan nature of this place is, if we say that money in there is a real surplus, then automatically money is going to go out of Washington to give a tax cut to the rich. Does the gentleman know anybody in Washington in any area that is proposing to do that?

Mr. COBURN. Mr. Speaker, everybody up here knows that that would happen, that political pressure would decide what and how that money was invested.

Mr. COBURN. Mr. Speaker, I come to the floor tonight with several of my colleagues who I think will be joining me, the gentleman from Minnesota (Mr. Gutknecht) as well as the gentleman from California (Mr. Cunningham). I am in my fifth year as a Member of Congress from Oklahoma. I am also in my last term as a self-imposed term limit on myself. One of the reasons I think that we only have 40 percent of the people voting in elections is that in fact there is a crisis of confidence in the Congress of the United States. I want to spend some time tonight outlining what we have heard many people say, whether it is the President in his State of the Union speech or others in terms about our budget, this so-called surplus that does not exist, explain to the American people why it does not exist and what it is really made of, and then talk about some of the facts of the last 3 or 4 years of what has gone on and what we can expect in the future if in fact we do not have honesty with the American public in terms of our budget, the budget process, and speaking honestly about where American tax dollars go. I also might add that besides being a medical doctor who continues to practice and deliver babies on the weekends and the days that we are not in session, my original training is as an accountant. I can tell my colleagues, there is not an accountant in this country that would sign off on the books of the Federal Government. The reason is because it moves money around, it does not account for it, it uses the same money twice and then claims it as a surplus. To start this discussion, I really want to try to explain to the American public the Social Security trust fund. Most people are paying 12.5 percent, half of it themselves, half of it by their employers, in to fund the Social Security system. At the present time, we have a significant excess number of dollars coming in above and beyond what is required to pay out benefits for our seniors under Social Security. What really happened is we are collecting more than we are spending in terms of Social Security dollars. What happens now is that the Federal Government uses the excess Social Security money to pay for more spending and to pay off publicly held debt. But as they pay off publicly held debt, they incur another debt and that is an IOU to the trust fund that says we will pay this back. That also incurs interest. The fancy way Washington talks about that is that that is a surplus. In fact it is only a surplus in that we have transferred the obligation to our children and grandchildren and they will pay that back through increased payroll taxes. So we put IOUs that are credited to the trust fund. In 2013, we face a major problem, and that is the year in which the revenues that come into the Social Security trust fund will be less than the payments that we have to pay out. What is going to happen then? Social Security spends more than it collects. In order to pay all the Social Security benefits, Social Security is going to have to try to collect from the Federal Government on the IOUs, the money the Congress has borrowed. What happens? Having spent all the money, the Federal Government has to raise the income taxes or the payroll taxes on the people who are paying Social Security taxes just to meet the obligations. That is borne out a little bit better when we actually see what the Social Security Administration says about what is going to happen to the fund. As you can see, all this in red is actually money coming in to Social Security in excess of what we are paying out. You will notice in 2013, we actually spend more money. But if you go out to the end of this graph, what you will see is we are getting close to $750 billion more a year in payments from general tax revenues, or increased raises in the tax paid on hourly wages in this country. We have a terrible picture developing. I say all this because the politicians in Washington claim we have a surplus. There is no surplus. The money that they are using to pay down external debt is actually money they are going to be obligating our grandchildren for with a Treasury IOU that is interest-bearing. That money is a false surplus. All it is is the difference between what we paid out and what we have collected versus what we have spent more in other revenues that the Federal Government has taken in. We are going to have only three options in 2013, and, better, we only have three options now to fix this problem: One, we can save 100 percent of the Social Security surplus and we can transition to a system that increases the earnings for all payments on Social Security between now and 2013 and thereafter. The annualized yield, the return on the investment on Social Security over the last 20 years, has been less than 1 percent. We would have been better to put it in a passbook savings account by 300 percent in terms of the power of compound interest. Had we done that, we would have displaced this day of reckoning where the imbalance in payments out versus revenue in would have been at least delayed another 10 to 12, maybe even 15 years, had they gotten some return. I think the other point that needs to be made, why are we in trouble on Social Security? We are in trouble on Social Security because politicians easily spend your money without coming and saying, ``We're going to give you an increased benefit but we're not going to tell you that your children and grandchildren are going to have to pay that back.'' How do they pay that back? They pay that back by lowering their standard of living and sending more of their hard-earned dollars to Washington to pay for the benefits today that we did not have the courage to tell the American public that for this benefit, this increase in benefit, we have to pay for it. What is easy to do in Washington, I have found in 5 years, is to pass on a benefit and not be responsible for paying for it. It is called spin. The real thing it is called is a half-truth. A half-truth, my daddy taught me, was a whole lie. We have seen a lie. The second option we have, we can repay the money from the trust fund by raising income taxes. We are at the highest rate of taxing the American public that we have ever been with the exception of World War II. Almost 22 percent of our gross domestic product is now consumed by taxes in this country. That is not a good option. The third option is we can change the retirement system. We can delay the onset, we can decrease the benefits. That is just like we have done to the veterans. We promise one thing and then we deliver far less. It is not a principle of integrity to do something less than what you commit to do. So we only have three options when we are faced with Social Security. I want to just develop this for about another 5 minutes and then I will recognize the gentleman from Minnesota. Now, we hear Washington say we have a surplus, but the fact is, is every day $275 million is added to the national debt. If we have a surplus, if we have more money coming in than we are paying out, how come the debt for our children and grandchildren is rising? It is because we are not honest in our bookkeeping. We are not honest about it. In 1997, each citizen's share of the national debt was $19,898. By the end of this year, every man, woman and child from baby to grandmom will owe $20,693. You cannot have a surplus and the debt rise. The question that the American people should ask when they hear the word surplus is, ``Did the debt go down?'' There is another tricky word that the politicians use. They say publicly held debt. Because that is the debt that is external to the internal IOUs that the government has paid or made with Social Security. So it is true that the external-held debt of the United States went down, but only because we took money from the Social Security Trust Fund and wrote another IOU. So the total debt in terms of the Social Security increased revenues or excess revenues have not changed at all. We have just decided we are not going to pay ourselves and we will slow down the pain to those people on the outside. So less debt is held by the public; that is true, but the total debt is rising, and, as my colleagues can see, it is rising $275 million per day, and where I come from, $275 million is one whole heck of a lot of money. It is about enough to run the State of Oklahoma for a month. So, we are talking about huge sums of money. Again, I would make the point Washington says we have a surplus. If we have a surplus, why is the debt that our grandchildren and children are going to have to bear rising? Why is it going up? It is because we are not honest in our bookkeeping. Another way of looking at that, and this chart shows exactly what we have seen and heard about 1998, is what I call the politicians' surplus. Here is what we claim was a surplus, the Washington establishment. But, as my colleagues will note, here is the debt in 1997. What has happened to the debt? The debt went from $5,325 trillion to close to $5,440 trillion, almost a $120 billion increase. So, if the surplus was 60 some billion dollars, how come the debt went up $120 billion? Look what is projected in 1999. We are going to have this great big surplus that everybody wants to save or spend in a certain way. But look what the debt projection is. These are not my numbers; these are from the Congressional Budget Office, a nonpartisan agency made up and influenced by both Democrats and Republicans, and they are saying the debt is going to continue to rise despite this surplus. So, Mr. Speaker, I think we can see that there is a lack of honesty about our budget policy and there is only one answer. It is called restrained spending. We have to be fiscally disciplined in the money that comes to the Federal Government. The other thing I have learned is that if we leave money in Washington, do my colleagues know what happens to it? It gets spent. Somebody always has a good idea on a way to spend the money, except the money we are spending now we are stealing from the Social Security system and we are transferring a lowered standard of living to our children. And what we can see under President Clinton's budget, and this is real numbers by the Congressional Budget Office under the budget that he proposes to see that there is no surplus; the red indicates real deficit in terms of moneys in versus moneys out, and even though all sides of the aisle, Democrat, Republican and the President, are claiming the surplus, we can see from here that one does not exist. Even with a conservative plan that restrains spending we are still going to see a deficit up until about 2000. It may be that the economy is good enough that we may see a real surplus this year. But look at the difference if we restrain spending in terms of real surplus; in other words, something that will actually slow down the growth and the debt, decrease the debt, decrease or, in an inverse, increase the standard of living for our children, that if in fact we will restrain spending, that in fact we will markedly help the children of tomorrow. Mr. Gutknecht.

Mr. COBURN. Let me add one thing. I remember my first year in Congress. We rescinded and cut $70 billion worth of spending from this government that year, and I would tell my colleague that nobody in my district noticed that, and if we extrapolate $70 billion a year over the last 4 years, what we plainly see is the main reason that we are in surplus is what is 70 billion one year becomes 90 billion the next, becomes 120 billion the next, becomes 150, that that is worth about $160 billion in spending that is not happening today that would have happened had we not come in here and done a large rescission and also markedly cut the size of the government in 1995. And so it is important to use that as a historical thing, that because we had fiscal discipline, that we, in fact, have an opportunity to truly lower the debt, not just the public debt, but all the debt, and that means creating a better future, creating opportunity, creating a standard of living that is going to be greater than what we have experienced for our grandchildren. I yield back to the gentleman from Minnesota.

Mr. COBURN

Mr. COBURN. Mr. Speaker, on Thursday, March 18, I was visiting with officials in Albania and consequently was not present for Roll Call votes 57 through 59. Had I been present, I would have voted ``yea'' on rollcall No. 57, agreeing to the resolution providing for consideration of the bill H.R. 4. I would have voted ``nay'' on rollcall No. 58, the motion to recommit with instructions. I would have voted ``yea'' on rollcall No. 59, passage of H.R. 4, a bill to declare it to be the policy of the United States to deploy a national missile defense.

Mr. COBURN

Mr. COBURN. Mr. Speaker, reclaiming my time, let me reemphasize first, if I can, four options. One, save the money. Do not spend any of the seniors' Social Security money by growing the government. Number two, raise taxes. Number three, cut benefits. Number four, and that is do nothing. That is what the politically expedient would say, do not do anything with Social Security because one cannot get reelected if one does it. The fact is we have an obligation to save Social Security. We have an obligation to save 100 percent of the money that is going into it now for Social Security. Then we have an obligation to fix the system for the generations to come. Mr. Speaker, I yield to the gentleman from South Carolina (Mr. Sanford).

Mr. COBURN. Above the spending caps agreed to in 1997. I would like to make a point. Our country is rightly worried about education. We are going to have a lot of debates on this House floor on how we do that. But to assume that we cannot reprioritize the spending of the Federal Government to direct more money to education by eliminating waste, eliminating duplication, by doing the oversight to make sure that the programs that are out there are working means that we are lazy and we are not willing to do our job. Nobody feels that this government is efficient. It is not efficient by any standard. We can exact more efficiency from this government. If we had a crisis today in this country, if we were to go to war or some other, we would come in here and we would make the cuts that we need to make to still offer the services but we would ensure that it was done efficiently. That is what we have to do. We have to restrain spending. We can direct more money to education, but that money should not be stolen from Social Security. It should come from the wasteful programs that this government funds today. For us to do something less than that means that we violate the very oath for the reason that we came up here.

Mr. COBURN. The three babies I delivered this weekend owed $20,000 at the time I spanked their bottom to get them to start breathing. That is a heck of a legacy for us to leave those children. They are born, they come into this world, and we are going to strap them with a $20,000 debt. I have here a little chart based on what is happening right now under the budget we are under and under the proposal of President Clinton. I want to carefully choose my words here as we go through this. I think the American public can understand. The excess payments in Social Security last year, this year, are expected to be $127 billion. More comes into the trust fund than will be paid out. If we had kept the 1997 spending caps and not, with a gun at our heads, passed an omnibus reconciliation package last year, we would have had a deficit this year of $1 billion. From $220 billion, $350 billion, to $1 billion. But we did not, we gave up $15 billion above the caps in October-November last year. Then we have the proposal from the President to spend a billion dollars for the disaster in South and Central America, which had no recommendation that we pay for it. That money has to come from somewhere. So we will borrow it from the Social Security Trust Fund. So what is happening right now is, already this year $17 billion of the excess has already been stolen for 1999, leaving $110 billion. But that is not the important point of this. We can fix that, if we will restrain spending this year and move that $15 billion back up in this next year. But look at what the estimates are from the bipartisan, that is Democrat and Republican, Congressional Budget Office. We are going to get $138 billion in excess payments in the year 2000. That is what they are estimating right now. The Congressional Budget Office estimates right now that the Congress is going to spend $5 billion of that, just on the track that they are on right now with the 1997 agreements. If we add the new programs that President Clinton has in his budget, we steal another $20 billion. Then, if we take what the President said, which is even technically misleading, that he wants to reserve 62 percent, and we spend the rest on the programs that he wants to spend, what we actually do is spend all but 59 percent of the Social Security money. So the important thing is that, if we look at the green here, we went from $110 billion of savings in Social Security, and now we are looking at a, quote, politician's surplus. And what is happening to it? It is getting spent. So the politician's surplus is going to decline to $81 billion. It is not a real surplus, just how it is measured in Washington. So not restraining spending means that $57 billion of our seniors' money, of our grandchildren's futures are going to be spent this year in new programs, growing the government and stealing opportunity from our children.

Mr. COBURN. Correct.

Mr. COBURN. This next chart kind of brings it home. Every man, woman and child in 1997 owed $19,898. That is the debt divided by the population. In 1998 it went up to $20,123. This year, under the budget that we are operating now, the appropriation bills that have been passed, the debt for every man, woman and child in this country is going to go up over $500. The debt is rising, as we speak, $275 million a day. A day. We are adding $275 million. We are taking $275 million worth of lost opportunity for our children and grandchildren each day that we continue to run under a dishonest accounting system. I think that is something that the American public can relate to. So a surplus is only a surplus if an individual's portion of the debt is going down. It is only a surplus if the debt is going down.

Mr. COBURN. Now, supposedly we had a surplus, yesterday. That is what the politicians in Washington are saying. We had a surplus. Why, then, did the debt go up $120 billion for our children and grandchildren to repay if we had a surplus? The American public should know this. If they want to know if we have a surplus, we will have a surplus the first time the actual debt goes down. And we will not have a surplus until the American people hear that. So if anybody says we have a surplus, people should ask them at the same time, does that mean a surplus with the debt rising or a surplus with the debt going down. Because the only way we can measure if we have a surplus is if the debt goes down. We can see in 1997 we had a small deficit, but the debt rose significantly. In 1998 we claimed, politicians, a $69 billion surplus; right? What happened to the debt? It rose from $5.330 trillion $5.445 trillion, another $115 billion increase in the national debt. Yet the politicians in Washington said we had a surplus. We did not have a surplus. It is totally dishonest to speak of a surplus. We had more money coming in than we paid out, but we borrowed all that plus the 44 trust funds that the gentleman from Minnesota (Mr. Gutknecht) talked about, the airport trust fund that we pay $2 each way on every ticket; the inland water trust fund. We took money from all those trust funds, plus Social Security, to run the government, and we have not been honest in the accounting of it. So it is important for people to understand the only time that we have a true surplus is when the debt goes down or taxes go down.

Mr. COBURN. One of the things we want people to understand about this is this concept of surplus. I have a little history for us and a little proposal for what we have today. It makes sense, if we have a surplus, that the national debt should not go up; correct?

Mr. COBURN. Absolutely.