Kent Conrad

Mr. CONRAD

Mr. CONRAD. That is correct, because this would extend it at least another 12 years beyond 2008 to 2020. With the new projections that are coming in, I believe it will be extended even beyond that. That is fundamentally the question and the choice before this body. What are we going to do with these surpluses? Our friends on the other side of the aisle say: Social Security and tax cuts. We are saying in this amendment: Yes, Social Security, every dime of Social Security surplus for Social Security. But then let's provide additional resources to strengthen and preserve Medicare. And then, yes, let's also have funds that are available for high-priority domestic needs like education and health care and, yes, defense. And also have resources to provide some tax relief. I put marriage penalty right at the top of the list. That is provided for in this amendment.

Mr. CONRAD. That is exactly correct. As the Senator may know, as a member of the Finance Committee I have voted repeatedly to reform Medicare in order to further extend its solvency. But it is my conviction, and I think the failure of the Medicare Commission so indicates, the need is for additional resources into Medicare. We also need to reform that system. But without additional resources I do not believe we will succeed in extending the solvency of the Medicare system. So, there is really a two-part test here, to reform the system and to provide additional resources. If we do not protect them, if we do not lock them up, I assure you, Senators like our colleague from Texas will take the money and he will send it back to those who are earning over $833,000 a year. He will send them a $20,000 check and we will find our grandparents and our parents, who are dependent on Medicare for their health care, are not going to have it. That is the choice before the body. That is the choice before the body.

Mr. CONRAD. The Senator from Massachusetts asks a good question. The simple answer to the Senator is: By locking up additional funds for Medicare, we would be in a position at a later point, because we cannot do that in the context of the budget resolution, to extend the solvency of the Medicare system for at least another 12 years. That is the goal of this effort; to first lock it up and protect it so it cannot be diverted for some other purpose and then, when we get at a later point where we can make transfers which we are precluded from doing in a budget resolution, to then extend the solvency of the Medicare system. That is what this is all about: Protecting, strengthening Medicare, as well as strengthening Social Security.

Mr. CONRAD. I would be happy to yield for a question.

Mr. CONRAD. I thank the Chair. I have been delighted at hearing the description of my amendment by the Senator from Texas. He has probably the greatest imagination in the Chamber. Unfortunately, his imagination has been working overtime, because his description of my amendment has virtually nothing to do with my amendment. The Senator from Texas suggests that my amendment is to prevent a tax cut. That is not the purpose of my amendment. My amendment is very clear. My amendment provides a lockbox that reserves every penny of the Social Security surplus for Social Security. It then goes to the next step and reserves 40 percent of the non-Social Security surplus for Medicare because Medicare is in imminent danger. I point out that the Senator from Texas knew that last year. I don't know what happened in the last year that has caused him to forget it. But here is what he said last year. What a difference a year makes. He said: . . . [w]hat would we do if we had a half a trillion dollars to spend? He said then: The obvious answer that cries out is Medicare. . . . I think it is logical. People understood the President on save Social Security first and I think they will understand save Medicare first. . . . Medicare is in crisis. We want to save Medicare first. The Senator from Texas said that last year. This year, the budget that he is advocating doesn't save one penny of the surplus for Medicare. That is where the difference lies. He wants all of the non- Social Security surplus to go for an across-the-board tax cut. Where does that go? Guess where that goes. That goes to the richest among us. Here is what the top 1 percent gets in his proposal. They get $20,000 of tax cut. What happens to the bottom 60 percent? They get on average $99. Maybe that is why now the Senator from Texas doesn't want to lock up and protect one penny of surplus for Medicare, because he wants to send it back not to Dicky Flatts. He wants to send it back to Dicky Flatts' wealthy friends, 20,000 bucks apiece to them; $99 to the rest of the people. The vast majority of the people, the top 1 percent, get $20,000. The bottom 60 percent get $99 on average. Mr. President, the Senator from Texas suggests there is no money available for a tax cut under the Conrad amendment. That is not my amendment. That is a great speech. It is a great political argument. The only problem with it is that it is not true. It doesn't have anything to do with my amendment. Let's be honest. Let's be honest. What does the Conrad amendment do with the surplus over the next 10 years? Over the next 10 years the surplus is $2.6 trillion. Under my amendment, the $1.8 trillion that comes from Social Security would be reserved for Social Security. Second, another $376 billion would be reserved to strengthen Medicare. Interestingly enough, last year the Senator from Texas said what happens if you have a windfall? The first priority ought to be Medicare. This year, he doesn't want to provide one thin dime out of the surplus for Medicare. He wants it all to go to a tax cut, an across-the-board tax cut that has this result. I don't think that is the priority of the American people to give a $20,000 tax cut to folks who are in the top 1 percent, people who have an average income of $833,000. I don't think that is a priority of the American people. Not one dime of surplus for Medicare, but provide it all to a tax cut for people who earn $833,000, give them $20,000, when Medicare is the program that is in the deepest trouble. What sense does that make? Let's go back to what the Conrad amendment provides, because the Senator from Texas talks about an amendment that is not the amendment that is before the body. It doesn't prevent tax relief. It doesn't prevent correcting the marriage penalty. The Senator from Texas knows better. The amendment that I have offered offers of the $2.6 trillion of surplus over the next 10 years $1.8 trillion that comes from the Social Security surplus which goes to Social Security; $376 billion goes to Medicare. That leaves nearly $400 billion that is available for tax relief and for domestic priorities like education and defense and health care and, yes, tax relief. In fact, you could easily accommodate taking care of the marriage penalty under my amendment. You could provide other forms of targeted tax relief under my amendment, because those are the priorities of the American people. Save Social Security, dedicate every penny of the Social Security surplus for Social Security, and then 40 percent of the non-Social Security surplus for Medicare, because it needs money, a need that the Senator from Texas himself recognized just a year ago. In addition to that, $400 billion available over the next 10 years for high priority domestic needs like education and defense, and yes, money available for tax relief as well. Mr. President, that is what this amendment provides, not the description given by the Senator from Texas that bore absolutely no relation to the amendment that is before us. I thank the Chair.

Mr. CONRAD. I just want to make clear that at the end of this discussion I want a chance to respond to any points that might have been raised in objection to the Conrad amendment before we go to another amendment.

Mr. CONRAD. Mr. President, I ask that Senator Reed be recognized for 10 minutes to speak on the amendment.

Mr. CONRAD. Mr. President, I call for the regular order.

Mr. CONRAD. If I might just state, there was not consent granted to go off the Conrad amendment, and the reason consent was not granted is we have two Senators who have been here for a considerable amount of time waiting to talk about the Conrad amendment. We allowed the other side to speak to their pending amendments. I twice gave consent for the other side to argue the amendment of Senator Ashcroft, and then it returned to a discussion on the Conrad amendment. I think it is only fair that those Members who are here be given a chance to address the Conrad amendment. They were here for that purpose, and then we go to the Bond amendment, which is on a different matter and is a different amendment. So I ask, in fairness, that those Senators who are here, specifically Senator Reed of Rhode Island, and the Senator from New York, be given an opportunity to discuss the Conrad amendment which is the pending business. I did not give consent to going off my amendment to go to the next amendment. Mr. GRAMM addressed the Chair.

Mr. CONRAD. There was not consent on this side for setting aside the Conrad amendment. Mr. GRAMM addressed the Chair.

Mr. CONRAD. How did the Conrad amendment get set aside?

Mr. CONRAD. What is the pending business before the Senate?

Mr. CONRAD. May I intercede with a parliamentary inquiry?

Mr. CONRAD. Fair enough.

Mr. CONRAD. We will be ready to vote, then, at approximately 7 o'clock.

Mr. CONRAD. I understand. But now we are in a unanimous consent posture, and if we are going to do that, to get unanimous-consent we are going to have to have an equivalent amount of time or there will not be a unanimous-consent agreement.

Mr. CONRAD. I want to make sure we have an equivalent amount of time on both sides. I don't know what you have taken down in terms of response on the Conrad amendment, but we want to make certain we have an equivalent amount of time on our side to answer.

Mr. CONRAD. Yes, I would like more time after I hear the argument of the distinguished chairman.

Mr. CONRAD. The Senator is exactly correct. He is reading the table exactly in the correct way. I might just say to my friend, the Senator from Massachusetts, really I think our friends across the aisle have about spent this $100 billion three or four times. Because, to anybody who comes to them and says there are any deficiencies in their budgets, they say we have $100 billion we have not spent. Of course all that money, based on history, will go for emergencies and disasters, every penny of it. That is why they have not put one penny of the surplus into a Medicare lockbox, because they really want to spend that money two, three, or four times. They say to the Medicare people who are interested in Medicare, ``We have that $100 billion. It will go for Medicare.'' They say to those who are concerned about disasters, ``We have funded that. We have this hundred billion we have not spent. It's available for disasters and emergencies.'' They say to anybody else, ``Your money is in that pot of $100 billion.'' Surprise, surprise, there are going to be an awful lot of people lining up for that $100 billion who will find there is nothing there for them because the money has all gone for disasters and emergencies. That is really what it is reserved for. There is really not a penny of surplus that is lockboxed for Medicare--not a dime. Mr. President, this amendment is an attempt to protect Social Security, to protect Medicare, to allow us to get ready for the challenge we face. We all understand Medicare is under enormous pressure. Social Security is under enormous pressure. Both of them need to be addressed. This is our opportunity. I yield the floor.

Mr. CONRAD. I will be pleased to yield.

Mr. CONRAD. Mr. President, unfortunately, when you pierce the veil on this one, what you find is there is not anything left. There is not any part of that money that is protected for Medicare, not a dime. There is $100 billion that is not spent in their budget plan, but based on our history we know it will probably all go for disasters and emergencies. There will not be any money available to strengthen Medicare. There will not be any money available to extend the solvency of Medicare. That is why I think this amendment is fundamentally important. Because we are saying: Yes, absolutely, save every penny of the Social Security surplus for Social Security. But, of the rest of the surplus, the non-Social Security surplus, we save 40 percent of it, lock it up, protect it by special budget points of order so it cannot be raided, it cannot be looted. It is there to strengthen Medicare. These are the top priorities of the American people: Medicare and Social Security. We believe we ought to provide protection for both. That is the essence of my amendment and I hope my colleagues will support it.

Mr. CONRAD. I would be pleased to yield.

Mr. CONRAD. Mr. President, the amendment that I am offering says simply, let us lock up in a safe-deposit box every penny of Social Security surplus and, in addition to that, 40 percent of the non-Social Security surplus for Medicare. Mr. President, that is what this depicts: Social Security's and Medicare's first lockbox. Let's save the Social Security surplus over the next 10 years. That is $1.8 trillion. And we save every penny of the Social Security surplus each and every year. In addition, we say let's also save 40 percent of the non-Social Security surplus for Medicare. These are the two top priorities of the American people. We say let's reserve funds for both of them. Let's make certain that there are sufficient resources to do the reforms that are necessary to strengthen and preserve both Social Security and Medicare. As I have looked at the lockbox offered by our friends across the aisle, it seems to me that there is a deficiency. I call this ``the broken safe,'' because, while I commend our friends on the other side of the aisle for locking up the Social Security surplus, they forgot something. They forgot Medicare. I am simply saying we ought to not only reserve the Social Security surplus for Social Security, but we ought to also provide for Medicare. Medicare is on the brink of insolvency. In fact, it is closer to going under than Social Security. So let's take the top priorities of the American people and put them at the top of the list for the Congress as well. Let me make clear that under this plan we would have $1.8 trillion over the next 10 years for Social Security. We would have over $370 billion for Medicare. But those aren't the only priorities. And we understand there would also be money left over--some $385 billion over the 10 years--for top domestic priorities, including education, defense, and health care and, yes, tax relief for hard-pressed American families, but the difference is one of priorities. If I could go to this next chart and show the comparison, under the plan that we are offering we are saving Social Security and Medicare first because we think those are the priorities of the American people. We save 100 percent of the Social Security surplus in every year. We save 40 percent of the non-Social Security surplus for Medicare. Overall, we are saving 77 percent of the unified surplus in comparison to 62 percent in the Republican plan. That means we are paying down more of the publicly held debt than the plan offered by our friends across the aisle. In fact, we will pay down $300 billion more of the publicly held debt under the plan that I am offering in this amendment than the plan of our colleagues on the other side of the aisle. So, over 15 years, we reserve $700 billion for Medicare, over $370 billion for 10 years, but over 15 years over $700 billion for Medicare. Our friends on the other side, on the other hand, have tax cuts of over $700 billion over that same period. But they have not one dime of the surplus saved for Medicare. Mr. President, we think that is a mistake. If we look at the combination and compare the two plans, here is what we see. The Republican plan is in blue. The plan I am offering is in red. In the years 2000 to 2004, the Republican plan would save $768 billion. We would save $833 billion for Social Security and Medicare. And over a 10-year period, the Republican plan would save about $1.8 trillion. We would save $2.155 trillion, because not only again are we protecting every dollar of the Social Security surplus for Social Security, but in addition we are reserving funds out of the surplus for Medicare. Why? Because no part of the Federal budget is in greater danger than Medicare. And, yes, we need to reform the program. In addition to that, we need to put additional resources into Medicare to extend its solvency. Right now we know that Medicare is threatened by the year 2008. What is going to happen? What is going to happen to the millions of Americans who rely for their health care on the Medicare system? Not only is it important to our grandparents, it is important to their children, because what happens if the health care of their parents are not provided for? What happens if the promise is not kept? I think we all understand what happens. The responsibility and the debts shift, and the children will be put in an impossible position as well. I believe this amendment reflects the priorities of the American people. The Republican plan basically says save money for Social Security. I commend them for that part of the plan. But almost all of the rest of the money they say is reserved for a tax cut will go disproportionately to the wealthiest among us. We say those are not the priorities of the American people. Instead, we ought to save every dollar of the Social Security surplus. But we also ought to reserve 40 percent of the non-Social Security surplus for Medicare. That will still leave nearly $400 billion available for high- priority domestic concerns like education, defense, health care, and, yes, for tax relief as well. That we believe reflects the priorities of the American people better than those offered by the other side. They have in their plan over $800 billion reserved for tax cuts. They don't have one penny reserved out of the surplus for Medicare--not one penny. Mr. President, we don't think that is the right set of priorities. I remind my colleagues of what they said last year in the Budget Committee debate. This is the chairman of the Budget Committee, the very able Senator Domenici. Last year he said this. . . . Let me tell you, for every argument made around this table today about saving Social Security, you can now put it in the bank that the problems associated with fixing Medicare are bigger than the problems fixing Social Security, bigger in dollars, more difficulty in terms of the kind of reform necessary, and, frankly, I am for saving Social Security. But it is most interesting that there are some who want to abandon Medicare . . . when it is the most precarious program we have got. Senator Domenici was right then. What a difference a year makes. I wish this budget reflected those priorities. He went on to say: . . . [W]e are very concerned about the long-term effect our population demographics will have on Medicare, and we are of the strong opinion that the second objective of this budget should be to preserve Medicare. . . . We think the best way to do something commensurate with the depletion in the budget is to pledge any extra resources we have, not generating programs, but, rather, putting them in Medicare where they ought to be. Again, the distinguished Senator from New Mexico was absolutely right. We ought to put additional resources that come to us to secure Medicare for the future as well as Social Security. And Senator Gramm of Texas said just a year ago in the Budget Committee, and I quote: . . . [W]hat would we do if we had a half a trillion dollars to spend? . . . The obvious answer that cries out is Medicare. . . . I think it is logical. People understood the President on save Social Security first, and I think they will understand save Medicare first. . . . Medicare is in crisis. We want to save Medicare first. That is Senator Gramm of Texas, just a year ago. What has happened? Why is there not a dime of the surplus reserved for Medicare in the plan of our Republican friends? There is not one dime locked away for Medicare. They will say: But we do have a surplus of $100 billion that we have not spent, that is really for Medicare. But, you know what, they did not do anything to protect it for Medicare, not one thing. Nothing has been done to protect one penny of that $100 billion for Medicare. Do you know what else, that money is also required for emergencies over the next 10 years. If we go back and look at the last 10 years, we know that $100 billion will be spent just for emergencies because we are spending about $9 billion a year for emergencies. Over the next 10 years, including debt service, we will use up that $100 billion of their reserve just for disasters. That leads me to the conclusion that without question they have not locked up one penny of surpluses for Medicare. The $100 billion that they talk about has not been protected for Medicare, not a dime of it. And every penny of it will likely be used for disasters and other emergencies because that has been the historical record.

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

Mr. CONRAD. Mr. President, I send an amendment to the desk and ask for its immediate consideration.