Kent Conrad

Mr. CONRAD

Mr. CONRAD. Unfortunately, the Senator is correct. In fact, the alternative minimum tax that affects now 2 million Americans, if the President's plan is passed, will affect 35 million American taxpayers, nearly 1 out of every 4. Just to fix the part of the alternative minimum tax caused by the President's tax bill will cost nearly $300 billion.

Mr. CONRAD. It is interesting, it is mostly speeches. All the speeches that were given, all the votes that were cast when we had the budget resolution on the floor, all the money added for education, all of it has been taken out. We are in the middle of a budget debate on the floor of the Senate, last week adding $150 billion. Meanwhile, we are passing a budget with no new money for education. The President said his top priority was education. The priority is every place but in the budget. There is no new money for education.

Mr. CONRAD. The Senator is correct. This is a budget with many missing pieces. Not only do we have missing pages, we have missing numbers. The defense buildup that the administration will ask for next week, after we finish with the budget, will ask for a massive defense buildup. So they have created a special reserve fund with a black hole in this budget that says whatever they decide later--whatever the President recommends--they can stick into this budget. They will not have a vote on it. We will sort of have a vote, we will vote now, before we know what the number is.

Mr. CONRAD. I don't know of any other way to read it. This chart I have shows the two debts that we have. The debt held by the public is the red line on this chart. The debt held in Government accounts, debt that is owed to the trust funds, is the green line. We see the debt held by the public going down, which is what has been described by the Senator from New Mexico. We see the debt that is owed to the trust funds going up. And the reason for that is, what is being done to pay off the publicly held debt is to use the surpluses from the Social Security trust fund--money that is not used now. That money is going to pay down publicly held debt--debt that is held by companies and individuals and other countries that is in U.S. securities--that debt is being paid down. But it is being paid down by using trust fund surpluses of the United States and, of course, they are then owed from the general fund of the United States, the money that has been borrowed from them to pay down the publicly held debt. So at the end of this time, the gross debt of the United States--the combined debt--will actually be more than when we started. So I think it is a little misleading for people just to talk about the publicly held debt.

Mr. CONRAD. Dated May 8, it shows there the public debt increasing during this period. There has been a lot of talk out here that we are reducing the debt. That is true of the so-called publicly held debt, that debt which is held outside of Government coffers, outside of Government hands. The publicly held debt of the United States as we sit here today is some $3.4 trillion. By the end of this year, it will be $3.2 trillion. That is being reduced to the $800 billion referred to by the chairman. But the gross debt, the combination of the publicly held debt and the debt to the trust funds of the United States from the general fund, is actually growing.

Mr. CONRAD. The Senator would be correct, if he is on page H1958 of the Congressional Record.

Mr. CONRAD. No, not to my knowledge. I find it really rather incredible that we have a circumstance in which one person is going to be able to decide the defense budget for the United States--one person in the Senate, one person in the House of Representatives. In the Senate, the Budget Committee chairman for 1 year will be able to decide what number goes in, and in the House, the chairman of the Budget Committee there can decide for 10 years what the defense budget is going to be. It is fairly breathtaking. Think about what we read in the textbooks: That we have a representative democracy, that every State has two Senators and they have Members of Congress determined by the population of their States. They come here, they vote, and they decide. But in this circumstance, with the Republicans in control of the House and in nominal control of the Senate, because they have the Vice President prepared to break a tie, they are in complete control. They are in total control. This is their document.

Mr. CONRAD. It certainly is not a new way. It is certainly not what we were given to believe we were going to see when the President came to town, saying he was a uniter, not a divider. We have seen precious little of his moving in any way but insisting that it be his way or no way. This budget is certainly an example of that. Not only was there no involvement of our side or any Member of our side in the budget conference, there was not even a markup in the Budget Committee--none. There was not even an attempt to mark up a budget resolution in the Budget Committee.

Mr. CONRAD. No. What happened was, we had an initial meeting in which statements were made, the opening statements that are traditionally done in any conference. Then we were invited not to return. So this is a budget that has been written wholly by the other side of the aisle.

Mr. CONRAD. Twenty minutes for Senator Dorgan, and Senator Sarbanes only requested 10.

Mr. CONRAD. Mr. President, we have Senator Dorgan ready to go for 20 minutes and then Senator Sarbanes. If we could put those two in at this point, that would be helpful to moving the process along.

Mr. CONRAD. I wonder, could we give 12\1/2\ to both? Would that be all right? At this point we are starting to run out of time.

Mr. CONRAD. Mr. President, the Senator from Alabama used some pretty strong language out here. Socialistic? Please. I do not know of a single socialist in the Senate or anybody that has any thought of proposing anything socialistic in this Chamber. That is talk that is a little beyond the pale. Let's review what has happened in fact--not the rhetoric, the fact. This chart I have here demonstrates what has happened to Federal spending as a share of national income since 1966. Ronald Reagan took over in 1980. I do not think he was a socialist. But look what happened to Federal spending as a share of national income under Ronald Reagan and, effectively, Republican control of both the House and the Senate. Federal spending as a share of gross domestic product shot up under President Reagan. Now look what happened when a Democrat took over in 1992. Federal spending as share of GDP plunged. We have gone from 22 percent of GDP going to the Federal Government when Bill Clinton came into office to last year going down to 18 percent--a dramatic reduction of money coming to Washington for the Federal Government as a share of national income. Those are facts. As President Reagan used to say, facts are stubborn things. The Senator from Alabama said the Democrats defeated the lockbox. You bet we defeated the lockbox they proposed because the lockbox they proposed would have prevented us from honoring our national debt. The Secretary of the Treasury wrote us and said that would endanger the ability of the United States to meet its financial obligations. I was the author on this side of the lockbox legislation that passed, with the strongest vote in the Senate on a bipartisan basis. That lockbox passed. So when they say the Democrats opposed the lockbox, we opposed a fiscally irresponsible lockbox, and we supported the lockbox that with bipartisan support passed in the Senate. Facts are stubborn things. Senator Domenici said, in answer to Senator Nelson, that Senator Nelson put up a chart that had things that were not in their budget. That is exactly the point. The defense buildup they are calling for, this administration is calling for, is not in the budget. The strengthening of Social Security that this President is calling for are not in the budget. The additional resources for education this President is calling for are not in the budget. That is the problem with this budget: It is not a true accounting of what is going to happen here. The result is precisely what Senator Nelson described: We are going to be deep into the Medicare trust fund, deep into the Social Security trust fund, because what we have here is not a real budget. I thank the Senator from Washington for the time. Mr. President, I ask unanimous consent that the Senator from Washington be given an additional 5 minutes because I used her time.

Mr. CONRAD. And the Senator from Florida?

Mr. CONRAD. How much time would the Senator from Iowa like?

Mr. CONRAD. After the Senator from Minnesota, because he has time, we will give 2 additional minutes to the Senator from Illinois.

Mr. CONRAD. Yes.

Mr. CONRAD. Mr. President, I thank the Senator from Washington for her contribution tonight and, more importantly, for her contribution on the Senate Budget Committee. She is one of the most valued Members on our side of the aisle. I believe she could have made a significant contribution in the conference committee but, of course, we were excluded from the conference committee. Again, I thank Senator Murray for everything she has done as a member of the Budget Committee. I believe the Senator from New Mexico wanted to deal with a unanimous consent request.

Mr. CONRAD. Certainly.

Mr. CONRAD. No. The way it works, authorizations mean nothing without appropriations. And the money for appropriations is not available unless it is made available by the budget resolution. The hard reality here is all of this talk about money for education is just that, it is talk. We can pass 100 amendments that say we are going to provide money for education, but if the money is not in the budget, it does not get allocated to the Appropriations Committee to be available for actual expenditure. We have a lot of great speeches out here, but without the money in the budget resolution, they don't mean much.

Mr. CONRAD. There is no increase for education beyond simple inflation. I think the most honest direct answer that I can give is that there is no real increase for education, period. In addition to that, the pool of money from which education spending comes is actually below inflation. The cuts are going to have to come from somewhere.

Mr. CONRAD

Mr. CONRAD. One of the great problems of this budget is the defense buildup that we all know the administration is going to call for--in fact, we are told it is going to come out next week--and the Secretary of Defense was asked by the President not to come out with his defense numbers before we passed the tax cut. Why? I suppose reasonable people could conjecture why they didn't want the defense numbers out before the tax cut was agreed to. But I think I know. I think the truth is that they know if you have the defense numbers, and if you have what is likely to happen in education spending, and if you have some commitment to strengthening Social Security, which everybody says they are for as part of a budget document, then the budget document before us simply does not add up. That is their problem. When you put all of those numbers together, what you find is that you are into the Social Security and the Medicare trust funds. In conclusion, I take my colleagues back to the budget proposal we made on our side because I think it was a fiscally responsible proposal, one that took the $5.6 trillion forecast but understood that it was a projection, and that it is very unlikely to come true. The Senator from Michigan has just shown how inaccurate these forecasts have been year after year. They average being off by 100 percent or more. That tells me that we ought to be cautious in what we do. In the budget proposal we made, we reserved all of the Social Security trust fund money for Social Security, $2.5 trillion, all of the Medicare trust fund money for Medicare, $400 billion, and then with what was left, we had a proposed tax cut of $745 billion in comparison to the $1.3 trillion that is before us. In other words, we had about 60 percent of the tax cut that is being proposed. We had $300 billion more of investment on high-priority domestic needs. And the area where there were the big differences was education. We had $139 billion of new money for education. Actually, what passed the Senate was much more than that. But this conference committee came back with nothing--no new money for education. I know there are colleagues who believe this conference report has more money for education. It does not. It does not. I have gone over these numbers in great detail. There is only allowed in this budget resolution the inflationary increase so that we are not cutting the effective amount for education every year. The truth is, even with that inflationary adjustment, we are cutting what is available because the student population is growing. With no new money for education in real terms in what can be delivered per student, this budget cuts education, after the President has said education is his top priority. We had a smaller tax cut. We had more resources than is provided in this conference report dedicated to these high-priority needs, including education, including national defense, and including health care coverage. We set aside $750 billion to deal with this long-term debt that we all know is coming our way about when the baby boom generation retires. We set aside $750 billion for that purpose because we think it is kind of like the squirrel in the fall. You had better be putting some nuts away to prepare for the winter. In this conference report there is zero set aside to strengthen Social Security for the long term, to address this long- term debt that is coming our way. The fundamental difference between us is that we had about twice as much money set aside for debt reduction. The other side has about twice as much money set aside for a tax cut. We had more new money set aside for education and more money set aside for national defense than is in this conference report. But this conference report isn't the full story because we know the Secretary of Defense has said he is going to come out next week and propose a huge increase in defense. But they are not in the budget. We know the President has a Social Security commission that is going to come back and propose privatization. That has a transition cost of about $1 trillion. There is no money in the budget for it, just as there is no money in the budget for the defense buildup they are going to ask for, just as there is no new money for education, although the President says it is his top priority. There is something wrong with a budget that does not have what we really intend to do in it. That is the way we get into financial trouble. There is no private sector enterprise in America that would budget this way. It is profoundly irresponsible. I hope we reject the conference report. I sincerely do. I call on my colleagues to do just that. Let's go back to the drawing board. Let's wait until we have that defense number next week. Let's wait until the President proposes how much he needs to strengthen Social Security for the long term. Let's wait until we finish action on the education bill that is on the floor of the Senate right now and see how much money that is going to require, so that we have a full accounting, a full budget, and make certain that it adds up. Mr. President, I yield the floor.

Mr. CONRAD

Mr. CONRAD. The Senator from West Virginia is here seeking time on another matter. Could we enter into an agreement that the Senator from West Virginia be recognized for 15 minutes after the Senator from Michigan has completed?

Mr. CONRAD. Will the Senator yield?

Mr. CONRAD. Mr. President, I ask unanimous consent that the Senator from Massachusetts be given 10 minutes off the bill.