Judd Gregg

Mr. GREGG

Mr. GREGG. Mr. President, I would ask unanimous consent that the vote scheduled for 9 p.m. this evening be postponed to occur at 10 a.m. tomorrow, Friday, and that immediately following the granting of this consent, Senator Domenici be recognized to offer his amendment.

Mr. GREGG. Will the Senator from Delaware be inclined to have the time that has been consumed applied to the hour and then have the time begin to run?

Mr. GREGG. Will the Senator yield for a question?

Mr. GREGG. Would it be possible now to propound a unanimous-consent agreement that the time for debate on the Senator's amendment would be limited to not beyond 9 o'clock, that the time consumed up until now would be charged to your time, that the 5 minutes to be used by the Senator from Missouri be charged to our time, and that the remainder of the time be divided equally?

Mr. GREGG. I have just been advised that if that is the case, we end up locking in the offsets here, which is something we would rather not do. Why do we not continue to proceed.

Mr. GREGG. I have no objection.

Mr. GREGG. Mr. President, I suggest the absence of a quorum.

Mr. GREGG. Mr. President, I appreciate the presentation of the Senator from Delaware. There is some which I agree with and some which I do not agree with. I would like to point out that I agree with his comments relative to boot camp. We have used the boot camp process in New Hampshire, and it has been quite successful. I have to believe that the decision to drop the boot camp was inadvertent. I hope we will correct it. If the Senator at some point wishes to divide his amendment and bring that up separately, I would certainly be supportive of it. In any event, hopefully we can at least work out that part of his amendment. I suggest the absence of a quorum.

Mr. GREGG. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. GREGG

Mr. GREGG. I thank the Senator from Kansas. I wish to associate myself with her remarks. The point she is making is that it is not a question of whether or not the money will be spent on senior citizens' jobs programs. Under the proposal of the Senator from Kansas, the same amount will be spent on senior citizens' jobs programs as will be spent as it is presently structured. It is a question of whether or not those dollars actually get to senior citizens or whether they stay here in Washington and are administered by a group of unrepresentative, in my opinion, or at least by people who have not competed for the grants and that receive the grants. There are nine organizations that receive funds under this proposal. They receive them without competition. They simply are earmarked funds. These organizations, GAO tells us, are spending more than the law allows them to spend on administrative costs. Of the $320 million that is supposed to go to help senior citizens with jobs, $64 million of that $320 million is presently going to administration. The proposal Senator Kassebaum has brought forward and which is included in this bill would allow that full $320 million to go back to the States. We would no longer see that money skimmed off here in Washington for the purposes of lunches and funding large buildings that are leased or driving around the city or coming up here [[Page S 13495]] and lobbying us. Rather, it would go back to the States and the States would have the ability through their councils on aging to administer these programs and as a result the dollars would actually flow to the seniors who need the jobs, which is the basic bottom-line goal here. So if you want to vote against what basically amounts to a designated program where nine organizations benefit and put the money instead into the seniors' hands where the seniors can benefit, you will stay with the Kassebaum approach in this bill.

Mr. GREGG

Mr. GREGG. A recurring theme of this Congress is to find commonsense solutions to national problems. One of these is to create practical ways to promote recycling of waste material. This requires developing applications and processes in which benign waste performs, as well as, or better than, and at the same or lower cost as traditional materials. Experts at the University of New Hampshire have stressed to me that this requires integrating appropriate tests for long term physical performance with a thorough understanding of the long-term environmental implications. The committee provides $14,622,000 to FHWA for technology assessment and deployment and expresses its support for the priority technologies initiative funded under the section 6005 program. Would the committee consider evaluation of environmental and physical results of using benign waste materials in transportation infrastructure and helping AASHTO to incorporate those results into their construction standards to be a priority technology under the section 6005 program?

Mr. GREGG

Mr. GREGG. Mr. President, it is my understanding under the unanimous- consent agreement, at this time I was allocated an hour to bring forth an amendment. I do not intend to bring that amendment forward. I have been discussing this with the chairman of the subcommittee and ranking member of the committee and also with other cosponsors of this amendment, which deals with the export activity, drug, pharmaceutical, and device companies, and would address what I think is an absolutely essential need to reform our export activities so that our drug, our biological, and device companies are not put at the significant disadvantage relative to the international marketplace, and so they are not shipping abroad jobs, technology, and research which is what is occurring today. This amendment, which would correct that problem and make our pharmaceutical, biologic, and device companies more competitive and give them the opportunity to produce goods here, sell them abroad in a reasonable manner, and to do their research here, rather than shipping them abroad, is a critical amendment. [[Page S 10749]] I have received a commitment, and I am very appreciative of this from the chairman and ranking member of the committee, that this matter will be taken up at a markup in committee next Wednesday, as I understand it. That is very satisfactory to me. I think that will give Members a chance to have a full airing at the committee level and, hopefully, bring legislation to the floor which will address this issue, which I do feel needs to be addressed in the short term rather than the long term. With that background, I will not be offering my amendment. I yield back my time.

Mr. GREGG

Mr. GREGG. Mr. President, first I want to thank the Senator from New Mexico for his very generous comments, and join the Senator from Washington in exalting the efforts of the Senator from New Mexico who has for the first time in 25 years been able to put this country on the right track. Passing a balanced budget resolution is an amazing event. But, more importantly than that--and I know that this is what the Senator from New Mexico has kept his energies focused on in this area, and has kept us all focused on the goal--it is a great gift to our children and to the next generation. The Senator from New Mexico has a few, and also has a few grandchildren. It was because of his concern about their future and the fact that he has been for many years fighting the battle of making sure that we do not pass on to our children and our grandchildren a Nation which is bankrupt, that he has kept this committee and this Congress focused on the end line. The end line is to produce a budget which gets to balance, and as a result reduces the burden of debt which we are passing on to our children. So, once we pass this budget--which I am sure we will--and once we institute its recommendations, it will be a tremendous gift, which really will have been because of the author of and the wrapper of, and which we will be passing on to our children as a result of his efforts. I thank the Senator from New Mexico for having given us all this leadership in this area. I also would like to pick up on a comment that was made by the Senator from Washington because he is a pretty astute observer of this. He sort of alluded to the fact that we just heard a presentation from the Senator from Massachussetts and the Senator from Maryland which essentially said, if you would argue it properly, they were presenting the philosophy of the liberal approach to Government, sort of the philosophers of the left, so to say. It is their belief that Government must always grow and must always expand. I think their real outrage comes from the fact that we are contracting the size of Government. We are saying that really it cannot be allowed to constantly grow and expand beyond the ability to pay for it. And that as we contract the size of Government we are going to return some of the benefit of the contraction in the size of Government, or at least its rate of growth--we are never going to actually downsize it, but the rate of growth--return some of the benefit of that to the people through a tax break. It is sort of like prying money out of the hand of someone who is at the door of death, the liberal philosophy being at the door of death in my opinion, to try to get them to give any money back to the American people through tax cuts. That is what we are proposing. Think about it in the context of what these tax cuts are. They represent two-tenths of 1 percent of the total spending that the Federal Government will undertake over the 7-year period. We are going to spend $12 trillion over the next 7 years. We are talking about cutting taxes $245 billion. Yet, you would think that we were exercising a scorched earth policy against the actions of the Government by instituting that sort of really rather minuscule return to the American people of their benefit. Is this going to flow to the wealthy in America? First off, the resolution says it is not. The resolution says the tax cuts shall flow to the working people of America. And that is pretty obvious. We are talking about primarily the biggest tax cut being a benefit for the working families, people with kids; a $500 tax credit to people with kids. Now, sure, a lot of wealthy Americans have kids. A lot of middle-class Americans have kids. A lot of lower-income Americans have kids. I suspect if you were to line all those kids up and put them on a scale, you would find that the number of kids of the middle class and working Americans far exceed by a factor of millions, I suspect, the number of kids of the wealthy Americans. So, by definition, the vast majority of this tax cut is going to flow to just plain working American families that have children. That is where it is going. And is it such an outrage to take two-tenths of 1 percent of the spending that is going to occur over the next 7 years and say we are going to rebate it to you, the American people? Well, it is, if you are a liberal, because, basically, if you are a liberal, you believe you own that money, and you should not give it up. We own it, if you look at it from a liberal prospective. We should design the programs to tell you how to run your family. Well, what we are saying is let us let the American people have the money and manage their own families a little bit, have a little bit more money to manage their own families rather than have the Federal Government tell them how to run their families and how the money will be spent. This whole tax cut issue is really a lot of smoke from the other side both on substance and I think on policy also. I wanted to focus a little bit today on some other issues because we have heard a lot about how we are slashing and cutting Medicare and Medicaid and we are raising defense spending, and I have not heard too many numbers that have defended that in real terms because they cannot, if you look at the numbers. The fact is that if you take a freeze baseline--I think that is the only way to do it honestly--you say what are we spending today on Medicare; what are we spending today on Medicaid; what are we spending today on defense. Let us say it was $100 today. Two years from now, are we going to be spending $102 on these programs, or are we going to be spending $98 on these programs? That is an honest way of evaluating whether or not spending is going up or coming down. None of this current services baseline, none of this assumption baseline. It is what you actually take out and put on the table in the way of dollars for these programs. That is what counts for whether or not it goes up or it goes down. If you look at those numbers--like everybody else in this institution, I only function now with charts--you will see that over the 7-year period, Medicare spending, off the current baseline of a freeze, which would be $176 billion, goes up $349 billion. That is new dollars that we will be spending on Medicare over the next 7 years over what is being spent this year. Medicaid spending under this budget goes up $149 billion over the next 7 years over what we are spending this year. Defense spending goes down--this number happens to be wrong; it has been reestimated--$13 billion over the 7-year period. So this representation that we are somehow slashing Medicare, slashing Medicaid, in order to raise defense spending is absolutely false. There is no other word for it. It is false. The fact is Medicare and Medicaid spending are going up, and this chart shows it in a bar graph. This is how much Medicare spending goes up. This is how much Medicaid spending goes up. And as you can see, it is a very sizable portion. Medicare spending is going up almost--well, better than twice Medicaid spending, but Medicaid spending is going up better than 149 times what defense spending is going up because defense spending is not going up; it is going down. And so let us have a little integrity around here when we start talking these numbers. Some other numbers that I think are important are how these spending factors that we undertake over the next 7 years relate to the past 7 years, because we have heard a lot about how we are cutting Medicare, we are cutting Medicaid, and we are increasing defense. Well, if you look at it in relationship to the last 7 years, defense spending was $2.02 trillion over the last 7 years. Over the next 7 years, it is going to be $1.88 trillion. We will spend less on defense over the next 7 years than we spent on defense in the prior 7 years. Remember, there is no adjustment for inflation in here. That means defense is going down in hard dollars. It means defense is going down, if you look at it in inflationary dollars, even more. So defense is going down in comparison to the last 7 years. If you look at Medicaid spending and compare it to the last 7 years, over the last 7 years we spent $445 billion in Medicaid. Over the next 7 years we are going to spend $772 billion on Medicaid, almost twice the amount of money we spent in the last 7 years. So we are dramatically increasing the amount we are spending on Medicaid. If you look at Medicare, Medicare spending over the last 7 years was $923 billion. If you look at it over the next 7 years, we are going to spend $1.6 trillion or 73 percent more than we spent in the prior 7- year period. How can you define that as a cut? There must be some new math that I did not learn when I was in school that you get if you go to certain schools in this country which could define an increase of 73 percent as a cut. Not only is it not a cut, it is a substantial increase. Why are we doing this in the Medicare accounts? I think we have to understand that this budget resolution accomplishes a couple of very significant public policy events. No. 1, of course, is it balances the budget for the first time in 25 years, which is absolutely critical to our children. We hear a lot of talk about children and concern for the children. I do not think there is any question that everybody in this institution is genuinely concerned about our children and their future and how we address them. But I cannot think of a single thing that is more important relative to our children's future than to be able to give them the opportunity to have a prosperous lifestyle. And whether or not you have a prosperous lifestyle depends on how much debt you have to pay. It works that way in your home. If you run up a big debt and you have to pay it off, you are basically going to have a lot of trouble doing that. You are going to have to work hard, and you are probably going to work longer hours and you are probably going to find that you are able to keep less because you are paying off a big debt. This country is passing a big debt on to its kids, and unless we get this budget under control, it will get a lot bigger. So the most significant thing this resolution does is it improves the opportunity for our children to have a decent and prosperous lifestyle, and that, I believe, is the largest gift of all, as I said earlier, and will far outweigh some of the negatives that were alleged will occur from the other side, which I do not agree to anyway. But even if you accepted them on face value, they are far outweighed by the positive of balancing this budget for our children's future. Second, what this budget does is that, in driving this Government to be fiscally responsible and managed in a way that we can afford it, we are taking a hard look at all the major programs that are in this institution. And a lot of them were created with good intentions, but they have not worked. The classic example, of course, is welfare. No program has had a more disastrous track record than welfare considering the amount of money that has been spent on it. I am sure there are more disastrous programs, but in relationship to the amount of dollars spent on it, it would be hard to find. The fact is what this budget does is assumes that we are going to take the welfare system and improve it substantially, basically by putting it back in the control of the States that have the imagination and flexibility and the originality to create new and aggressive programs, and the Governors are excited about the opportunity. I can tell you, as a former Governor, they will deliver a heck of a lot more dollars to the recipients that need it by having flexibility than by having a huge bureaucracy on their back. So we are going to reorganize welfare. We are also going to take a hard look at the other entitlement programs, all of them, but the one entitlement program that needs the most scrutiny because it is the most sensitive and it is the most critical right now is Medicare, because the trustees of the Medicare trust fund--and this is not a Republican group; in fact, four of the six trustees are members of this administration, including the Secretary of HHS and the Secretary of the Treasury--the trustees of the Medicare trust fund have said that if something is not done to correct the fundamental financial situation or imbalance of the trust fund, it will go bankrupt in the year 2002. This is a chart that reflects that. This is where we are today, and this is where it goes--bankruptcy in 2002 for the trust fund. What are the practical implications of that? The practical implications are that there will be no insurance program for seniors in the year 2002. And so what does this budget proposal put forward? It puts forward ways in which we can effectively address that issue and bring under control the rate of growth of the Medicare trust fund so that we can afford it, and so that it will exist and work well for our seniors. It does not assume that seniors will get less care. It actually assumes that seniors will get more care. They will get more care because we will give them more options; we will give them more choices. And in the process, we will, hopefully, move them from a fee-for- service system into fixed-cost systems which can deliver high quality care but for costs which are predictable. Are we talking about cutting the Medicare trust fund to do this or cutting Medicare spending to do this? No. As I mentioned earlier, we are talking about increasing it rather dramatically, $345 billion of increase over the 7 years. And what does that work out in this inflation factor? It works out to the fact that today the Medicare spending is growing at 10.5 percent. What we are talking about in this resolution is accomplishing a rate of growth that is basically 6.4 percent. Mr. President, 6.4-percent rate of growth. That is what we are assuming for the Medicare spending under this resolution. Is that a cut? Only if you function under the liberal new math. Under any reasonable math, even moderate math, a 6.4- percent annual increase is still an increase in spending and it a very substantial increase in spending. In fact, it represents twice the rate of growth of inflation. That is the commitment we made in this budget. And it is a significant commitment to our senior citizens, and it will, we believe, produce a budget which will be in balance. Now, there has been some discussion about a couple other issues I wanted to touch on quickly. That is the education issue. There is a representation, if you were to listen to the earlier colloquy between the Senators from Maryland and Massachusetts, that all students everywhere will be impacted adversely by this resolution. Well, I think maybe they are not up to speed on what the resolution does. The resolution does say that graduate students will be impacted, but undergraduate students will continue to have their programs and have them pretty much the way they are today. Graduate students, yes. They will be asked to pay the cost of interest on their loans after they graduate from graduate school. Their interest on their loans will accrue while they are in graduate school, which they do not now. What does that mean? Well, it basically means John and Mary Jones working at the local diner, 60 hours a week to try to make ends meet, will no longer have to subsidize the guy who is going to law school and his graduate loan and the interest on that graduate loan. It means that lawyers, in fact, they will still be subsidizing them to some degree but that person going to law school will, when they get out of law school, because their earning capacity will be significantly increased, be required to pay the burden of the interest that was accrued on that loan. I think that is fairly reasonable. Yes, we should maintain the programs for undergraduates. I believe they should keep undergraduates free from the interest cost during the period they are in school. But for graduates, I can see no legitimate reason for not requiring them once they get out of graduate school, where they have increased their earning capacity dramatically, to pay back that interest. Because, after all, if we do not do that, what we are basically doing is transferring to our wealthiest Americans, the graduate students, from our moderate- and middle-income Americans' tax dollars, something that there appears to be outrage about over the tax cut. It does not clone that direction as mentioned earlier. But it seems to be acceptable relative to graduate students from that side of the aisle, this income transfer, from hard-working Americans to people who are clearly going to be quite wealthy once they get out of the graduate schools, whether it is law school or medical school or whatever. So that is, I think, a bit of a specious argument to begin with. But second it is specious because it ignores probably the most underlying positive event which this balanced budget amendment is going to generate for all Americans, not just for the Federal Government; that is, the fact that all the economists that have looked at this, including CBO, have said if we put in place a budget which balances the Federal budget over the next 7 years and does it in real numbers, with real terms, as this one does, that there will be a drop in the interest rates in this country of 2 percent. A 2-percent drop in interest rates is a huge benefit to homeowners, to people who are borrowing on their credit cards, people who are buying cars, and equally people who are going to graduate school. And I suspect just that the percent drop will more than pay for the cost of incurring the interest in later years or will certainly pick up a significant proportion. So, I do not find this argument to be very persuasive. Good politics, which unfortunately appears to be a big part of this debate, but not persuasive on the facts as is the argument that there is a Medicare cut here which is maybe good politics but is inaccurate and clearly not true on the facts. Now, the President presented a budget in this process also. The President has presented a number of budgets. The first budget was out of balance by $200 billion a year or $1.2 trillion over 5 years. And then he came forward and presented a second budget, just a little while ago. And that unfortunately came forward, scored by his own folks on the basis of his own numbers, something that he said he would not do, not scored by CBO. And when it was scored by CBO it turned out that budget was also out of balance by about $200 billion a year for essentially as far as the eye could see. But I want to congratulate the President. I think he has stepped on the playing field, finally. We have had a second effort here in June. And basically he has gotten involved in the process where he was not before. His first budget was clearly a walkaway from the budget process. Sort of a Pontius Pilot approach to the budget, just washing his hands of it. But this budget is not what he presented. Granted, CBO has scored it as a budget which does not get to balance. But when it was sent up it was sent up with some very basic assumptions which I think are good assumptions and good intentions. First, he has agreed we need to get to a balanced budget. His timeframe is 10 years. Ours is 7. I was interested in the Senator from Massachusetts's discussion of this issue. I was thinking that if we were to accept the President's budget, the Senator from Massachusetts would have been here--I am sorry I did not have a chance to ask him this--would have been here for 45 years before we get to a balanced budget, if I calculate right, since 1965. In any event, it is a long way away, but at least we agree it is a balanced budget. Second, he has stated that we need Medicaid and Medicare reform. That is important. Because you cannot get to a balanced budget unless you address the issue of Medicaid and Medicare spending. Third, he has agreed we need welfare reform. He not only agrees to it, he was the primary mover in this area. I give him credit for coming out early and aggressively to do something in the area of welfare reform, and hopefully we can accomplish it. So those are three areas of agreement. Fourth, he has agreed that other entitlement programs have to be addressed and discretionary spending has to be addressed and in the budget he sent up he had some good numbers in those areas. And fifth, he has proposed a tax cut. Less than what is in this budget but still a tax cut so it recognizes the need to flow dollars back to the people as we address this issue of balancing the budget. So, on five major points, five major points, we are basically in agreement, and the question comes down to dollars and timing. I think there is an area for significant action here. For example, in the Medicare, for all the slashing and cutting that we are alleged to do from Members on that side of the aisle in the Medicare accounts, I would point out if you compare the President's number to our number, in outlays--that is really the only honest way to do it--you take out all the assumptions, and the President's number is only $11 billion off from our number each year in a program that is spending hundreds of billions of dollars. Not really a very significant difference in the sense of coming to agreement. Significant difference? Yes. But a difference which is clearly manageable--Mr. President--$11 billion on accounts which spend hundreds of billions of dollars. So the President's numbers and our numbers are pretty close. On Medicaid it is even closer. The President's outlay numbers are only $9 billion different from ours. On some of the other entitlements, welfare, for example, $10 billion of difference from ours. Those are numbers that are very close. And I think they are numbers that can be resolved. And so the President has come forward with a budget which basically agrees philosophically with five of the points we have been raising: First, you need to get to balance; second, you need to address Medicare and Medicaid; third, you need welfare reform; fourth, you need to address the other entitlements in discretionary accounts; and, fifth, you need a tax cut. Which is what our budget does. And then his numbers in the key accounts, which are the entitlements accounts, are clearly in striking distance of our own numbers. So it seems to me there is an opportunity there for significant action to reach accommodation and reach agreement. Which brings me back to my original premise, which is that this budget is a no-nonsense, make- sense budget about how we get to balance and delivers to our children the opportunity to have a country which has some prosperity and hope for them. The President, from his presentation, appears to also understand the need for that. I hope that the Members on the other side of the aisle would agree with the President's view and agree that these goals are what are needed and agree that these numbers are places he can start, because as we go over to the appropriations and reconciliation process, maybe we can reach the accommodations necessary to deliver to our children this gift which is so critical, a balanced budget. I thank the President, and I yield the floor. Mr. LAUTENBERG addressed the Chair.

Mr. GREGG

Mr. GREGG. Mr. President, I congratulate the Senator from Ohio for his very thoughtful and indepth statement on the job training programs and how they should be adjusted to better deal with the issue of actually training people versus just creating bureaucracy. I think his proposals are excellent and I hope this Senate will take heed of what he has said and follow them closely. As a member of the Labor Committee, I have certainly tried to do that relative to his recommendations. Mr. President, I ask unanimous consent to proceed as in morning business.

Mr. GREGG

Mr. GREGG. Mr. President, I want to talk a little bit here today, however, about the budget conference agreement which has just been reached, because I do think there has been some information presented in the community at large that is inaccurate and misleading. This budget conference, which I had the opportunity to serve on, has reached agreement between the House and the Senate as announced last night by Leader Dole and Speaker Gingrich. It is a very positive event for America. It is the first balanced budget in 25 years, something we are in dire need of if we are as a nation to put our fiscal house in order and to pass on to our children a country which is prosperous rather than a country which is bankrupt. Those of us who have been working hard in the effort of trying to bring fiscal responsibility to this Government, to make sure we have a nation that does not continually spend away the legacy of our children, are proud that we have been successful in developing this budget. I think there are some points about the balanced budget that need to be noted. As we go into the debate next week, I am sure there will be a lot of discussion and a lot of hyperbole. But I hope we begin from a basis of fact. Some of the facts that are important are these. First, if we continue on our present course of spending, the Medicare trustees have told us-- and four of the Medicare trustees happen to be members of the administration, including the Secretary of HHS and the Secretary of the Treasury--have told us that the Medicare trust fund will go bankrupt in the year 2002. Under the law, once the Medicare trust fund goes bankrupt it cannot spend any money. There will, therefore, be no health insurance program for our seniors. This needs to be addressed. The conference agreement which we have reached addresses that issue and reverses that insolvency situation. Second, we know that if the Federal Government continues to spend in the pattern which is presented in the original budget of the President and in the President's budget as recalculated, the President's most recent budget as recalculated by CBO, that we would add over $1 trillion of new debt to our children's shoulders over the next 7 years. That would be a burden that would be unfair to load on them and which we cannot afford to do. I am glad to report that this budget conference does not do that. This conference leads us to a balanced budget and, as a result of leading us to a balanced budget, it takes out of the debt stream almost $1 trillion. That is debt our children will not have to pay. That is interest on that debt that we and our children will not have to pay. That is very important. Of course there are a lot of side effects that are very positive to reaching a balanced budget and to passing this resolution. They include the fact that for the first time in 25 years, the world community will be able to look at this country and say we have our fiscal house in order. As a result, interest rates will come down for Americans and that will benefit us as a Government, but more important, it will benefit our citizens for, in borrowing to buy a home or improve on their home or to buy a car or to educate themselves or their children, they will pay significantly less because interest rates will have come down as a result of us passing this conference report, which is a balanced budget. So that is some of the good news that comes from this proposal. I heard reported on the news--and this is what I wanted to specifically address this morning--as I was coming in, by a national organization funded by the Federal Government, that this budget proposal cuts Medicare by $270 billion and increases defense spending by $33 billion. If you wish to compare apples to oranges, and you wish to take great leave with the English language, maybe you could say something like that. But if you wish to be at all accurate or fair, you would have trouble defending that statement. The fact is, Medicare spending goes up significantly under this budget. Under the present projected spending patterns, Medicare will increase at 10 percent annually for as far as the eye could see. We cannot afford that rate of growth. That is three times the rate of inflation. It happens to be 10 times the rate of inflation in the private sector's premium costs on health care. And if it continued to grow at that rate, as I mentioned earlier, the trustees of the Medicare trust fund have told us that the Medicare system would go bankrupt. But there is no proposal to cut Medicare. There is no proposal at all to cut Medicare. There is a proposal to slow that rate of growth, to slow that rate of growth to 6.4 percent, which happens to be twice the rate of inflation. What does that mean in real dollars? It means over the next 7 years we will be adding in spending to Medicare, $349 billion over what would be a freeze baseline. In other words, if you froze spending today, you would pull that straight line out, and this is what we spend on Medicare today. How much will we spend over the next 7 years? We will be increasing spending by $349 billion. In fact, over the next 7 years, we will spend more on Medicare than was spent over the last 7 years. What will the average recipient see as a result of this increased spending? They will see that instead of getting $4,300 today in benefit support payments, they will be getting $6,300 by the year 2000. And in the year 2002 alone, the increase in Medicare spending will be $96 billion. How some national news media say we are cutting Medicare is beyond me, but they say it. Unfortunately, they are supported in that frame of reference by folks who are activists here in Washington. But it is inaccurate. It is inappropriate. What we are doing in this proposal is proposing to slow the rate of growth in Medicare. That is accurate. We are proposing it because, if we do not do that, the Medicare trustees have told us that the system will go bankrupt. The way we are proposing to slow that rate of growth is, I think, constructive. We are going to say to senior citizens in this country, you can have more choices for health care. Instead of using fee-for-service, which is the most expensive system, we are going to give you the choice of also using fixed-cost health care such as HMO's, PPO's, things like that. It will allow you to purchase a health care system at the beginning of the year for a fixed cost and get all of the health care provided to you by one group. It will not say that you have to do that. You can still stay with fee-for-service, if you want. But if you decide to go to an HMO, we will encourage you to do that. As a result, we will slow the rate of growth. There will also be some other action taken but it will be directed at making the system more efficient, more cost responsive, and continue to deliver first-class quality care. But under no circumstances will there be any cut in Medicare. The same is true of Medicaid. There is no proposal to cut Medicaid. Yet, if we are to listen to some of the media descriptions of this budget conference, you would assume there was, because they say there is. Actually, Medicaid spending will go up $149 billion over the next 7 years. Yes, we are going to slow the rate of growth in Medicaid spending again. We have to. Otherwise, we end up bankrupting our children's future. But there is no proposal here to cut it; it is to slow the rate of growth. And we will continue to deliver first-class service and, in fact, I think we will end up with better services because hopefully we will send these dollars back to the States with fewer strings attached. As a result of doing that, I am sure the State governments--as the Presiding Officer, who was Lieutenant Governor from the great State of Ohio, knows--will deliver those services much more efficiently and better once they are freed from this huge bureaucracy which is the Federal Government. More people get more dollars in support of their needs, rather than more bureaucrats getting more dollars in support of their needs. So the statement that we are cutting Medicare is inaccurate on its face. We are increasing Medicare spending by almost $349 billion over what would be a freeze level of 6.4 percent annually, a huge increase. Probably most healthy, it will still be the fastest growing function of the Federal Government. Yet, if you were to listen to this news report, you would presume that we were slashing Medicare in order to increase defense. Well, Medicare will be the largest and fastest growing function of the Federal Government as result of this conference report. And what will happen to defense? It goes down. It does not go up, it goes down. The representation that we are increasing defense spending is once again on its face wrong. If you were to take today's defense number and freeze it for 7 years, of that number defense spending will go down by $15 billion over next 7 years. Essentially, it is flat funding. That would be the best way to describe it. But in real terms, it goes down $15 billion. So the Defense Department accounts go down, and the Medicare accounts go up dramatically, which is the policy that is correct, by the way. That is exactly what we should be doing. We should be trying to get the Medicare system into a position where we can afford it, and into a position where the trust fund will be solvent. We must face the fact that we are going to have to downsize the military in the face of the post-cold-war period, and as a result of downsizing the military, less military spending will occur. This is what this conference accomplishes. Overall, what the conference accomplishes is something that no other Congress has been able to do for 25 years. It balances the Federal budget. It slows the rate of growth of the Federal Government. It does not actually cut spending over that period, overall Federal outlays. In fact, overall Federal outlays will go from $l.5 trillion in 1995 up to $1.875 trillion in the year 2002. There will be an annual rate of growth of the Federal Government of 3 percent. But, as I stated earlier, in getting to a balanced budget, it eliminates almost $1 trillion of what would have been deficit spending had we stayed on the glidepath presented by the President. Well, there was no glidepath presented by the President. It was sort of a take-off path by the President in the deficit area; or if we just let things be as they are. The reason we have done this is very simple. If we continue to run these deficits, if we do not address this issue now, as I said earlier, we will pass on to our children a nation which is bankrupt. That is not fair, and it is not right. It has been said many times on this floor by many members of our party that our reason, our purpose, in seeking this position here in the Senate is to put the fiscal house of the Federal Government in order--to downsize the Federal Government, and to return authority and the dollars to the States. This budget is the first step in accomplishing that goal. I certainly congratulate Senator Domenici, who is the driving force behind developing this budget on the Senate side; Chairman Kasich, on the House side; and, obviously, Speaker Gingrich and Leader Dole, for having the foresight, the vision, and the courage to put together this most extraordinary budget which will pass to our children a very critical gift, which is the gift of a Government that is fiscally sound. Mr. President, I yield the floor. I suggest the absence of a quorum.

Mr. GREGG

Mr. GREGG. Mr. President, I am pleased to join my colleagues, especially my colleague from Utah, Senator Hatch, in introducing this important piece of legislation. The Advanced Medical Devices Access Assurance Act of 1995 was developed to ensure that our senior population can be treated with the most advanced--and most cost- effective--medical technology available in the United States. As chairman of the Aging Subcommittee in the Senate, I hear constantly from older individuals who are concerned about their medical options: They read about a breakthrough technology that is being explored, and want an opportunity to have access to such a product. Believe me, these folks are often more up-to-speed about their medical choices than you or I; they take the time to do their homework on their health care. As my colleague, Senator Hatch, has mentioned, this bill is designed to get at the heart of a problem which has arisen from a Health Care Financing Administration policy. HCFA has ruled that it will not provide Medicare reimbursement for any episode--any portion of the care associated with the device, including the hospital stay--which uses a medical device not defined as ``reasonable or necessary.'' ``Reasonable and necessary'' excluded medical devices which are being implanted under an FDA investigation device exemption, or IDE. In other words, if a surgeon who is performing state-of-the-art medicine wants to take advantage of a product which has been granted an IDE, he or she can only do so on their population under age 65. The random nature of a person's date of birth controls their ability to receive the most modern care, to get that technology that we are constantly touting as the ``best in the world.'' A clear backlash from this policy has also been seen in the form of a mass exodus of clinical trials being conducted in the United States. The brain drain in medical device development and manufacturing in this country has already begun to have devastating results. Not only does the United States now have an atmosphere unconducive to research and development, but it has evolved into an environment that is unattractive for investment capital to be risked on medical devices. Not only does this relegate the citizens of this [[Page S 8948]] country to antiquated generations of technology, it moves jobs and innovation overseas. I am hopeful that the administration will listen to the plea we are making here today to address this critical issue. While it may seem like a small item on the agenda of the day, it is probably the greatest accomplishment we could achieve for those individuals whose lives and medical care we can so easily improve.

Mr. GREGG

Mr. GREGG. Mr. President, I rise in support of this amendment which allows New Hampshire to meet the safety belt use law requirements under section 153 of ISTEA. Under this amendment, highway safety funds would not be transferred from highway construction projects to highway safety programs if the safety belt use rate in fiscal years ending September 30, 1995, and September 30, 1996, is not less than 50 percent. In fiscal years thereafter safety belt rate shall not fall below the national average as determined by the Secretary of Transportation. It is my belief that the Federal Government should not mandate seatbelts; those decisions should be left to the States. I believe all individuals should wear seatbelts whenever they ride in a vehicle. Furthermore, I believe that local government, not the Federal Government, should continue to play a role in educating people regarding the need to take every precaution when operating a vehicle. As a former Governor, I realize firsthand the frustration local government experiences when the Federal Government attempts to micromanage public policy. Americans no longer want big brother looking over their shoulder attempting to force compliance with regard to seatbelt compliance. I am pleased that this amendment, which allows New Hampshire to be judged on its safety record for safety belt usage, has been adopted. This amendment will remove the current unfair mandatory penalties forced on New Hampshire without regard for its excellent seatbelt compliance record.

Mr. GREGG

Mr. GREGG. I have the right to yield for the purposes of a question, Mr. President. During the prior colloquy, there was a question asked and there will be a question asked during this colloquy, also. The point which I think the Senator has made and which I wish to elicit her thoughts on, further, are there not a variety of activities that occur on highways which determine the safety of highway activity, such as the size of a car that operates on the highway, such as the licensing of the operator of the car on the highway, such as the inspection of the car that operates on the highway, and the motorcycle, the licensing of the motorcycle operator on the highway? Are these not traditionally rights which have been reserved to the State? It is sort of strange that the Federal Government would pick out just one area of safety on a State highway issue to step into. Is that not the issue here, that there is basically a unique usurpation of State rights?

Mr. GREGG. I think the Senator from Maine has made a superb point, and I would like to ask the Senator if this is the basic concept. This is not an issue of health. It is not an issue of safety. It is an issue of States rights. On an issue of health or safety, that is a police power traditionally reserved for the State. It is ironic and anachronistic that the Federal Government has stepped into this area, where it has not stepped into 100 different areas that could be outlined. Is not what we are dealing with here an issue of who has the right to manage the health and safety of the State, and whether or not that right is nationally vested in the State government, and it is inappropriate for the Federal Government to come in and usurp that right?

Mr. GREGG. Mr. President, will the Senator from Maine yield for a question?

Mr. GREGG. Mr. President, if the Senator will yield, just to respond to that point, I believe that is absolutely true. I believe the Senator from Maine, the Senator from New Hampshire, and the Senator from Colorado have made this point extraordinarily well. That is, whether or not someone is on a highway and operating----

Mr. GREGG. Mr. President I will agree with that. That is obviously the purpose of this amendment, and I congratulate the Senator from Maine, the senior Senator from New Hampshire, and the Senator from Colorado for bringing this to the floor. I see the Senator from New Jersey is seeking the floor, and although I may have further questions of the Senator from Maine, I will pass up those opportunities. I appreciate the courtesy of the Senator from Maine in allowing me to answer these questions. [[Page S 8667]]

Mr. GREGG

Mr. GREGG. Mr. President, I wish to join with many of my colleagues today who support the amendment of the Senator from Oregon. In the process of developing a budget, we have to set priorities and, in this instance, I think the Senator from Oregon has rightly pointed out the initial budget resolution had some priorities that should be adjusted, and he has certainly pointed out the strengths and importance of NIH and what it contributes to the fabric of America's society and it should be supported. I strongly commend him for that. Therefore, I will vote for this amendment. NIH is a unique institution. It is a collection of some of the most talented and brilliant individuals from around the world, but especially from the United States, who are working together to push the envelope of improving the health of not only the American people but the world in general. It is an institution which is also fairly delicate. That type of talent and ability needs to be nurtured and needs to be supported, and it can be affected rather considerably by changes in its funding structure or in its general structure. Therefore, I want to commend and support what the Senator from Oregon has decided to do with this amendment, which is to assure that NIH remains a strong and vibrant institution as we move into the future, and that their commitment to improving the lives of all Americans will not in any way be undermined by this budget resolution. So I support and look forward to voting for the amendment offered by the Senator from Oregon. I yield back the remainder of my time to the Senator from Oregon.

Mr. GREGG

Mr. GREGG. Mr. President, today I rise to commend a distinguished citizen of New Hampshire, Margaret Swiezynski, for her many years of outstanding service to the Republican Party of New Hampshire and her community. Margaret has dedicated her life to her family and in her spare time has selflessly given her time to the Republican Party. Her commitment and dedication to her community are to be commended and her involvement in the VFW, Lioness Club, and the local St. Patrick's Church has been instrumental in shaping her community. Over the years, Margaret has seen many Presidential candidates come and go in New Hampshire, from President Nixon to President Bush. As always, Margaret played a key role in welcoming these candidates to our State and contributed to New Hampshire's reputation for being a key stop for everyone on the road to higher office. It is citizens like Margaret whose commitment and allegiance make New Hampshire such a special place to live and her many years of service should be applauded and certainly not go unnoticed. Margaret is the proud mother and grandmother of three children and six grandchildren and her commitment is another example of her dedication to family and community. It is a characteristic that can be cherished by her family and Milford, NH, her home of over 40 years. I, along with all the members of the New Hampshire Republican Party and the citizens of Milford, NH, whose lives Margaret has touched through her loyalty and devotion, would like to extend a heartfelt thanks and wish her all the best in her future endeavors.

Mr. GREGG

Mr. GREGG. Mr. President, I rise today with Senators Reid, Bradley, Coats, Cohen, Lautenberg, and Kyl to announce the introduction of legislation to repeal the sugar program. This legislation will eliminate the U.S. Department of Agriculture's [USDA] price support, subsidized loans, producer assessments, and marketing allotments for sugar. The sugar program is big government at its worst. At a time when the American people are demanding that the Federal Government assume a more limited role in society, this program goes in the opposite direction. Instead of leaving the sugar industry to market forces, the USDA wields the heavy hand of government intervention. Why should Congress repeal the sugar program? That is a good question, and I will give you but a few examples: It has been estimated by the General Accounting Office [GAO] that the program costs consumers and sweetener users an average of $1.4 billion annually. The producers who sell the most sugar reap the biggest benefit. Right now, the world sugar price is half that of the United States. The sugar program stifles competition. In 1991, the GAO estimated that 42 percent of the program's benefits went to only 1 percent of the growers. The 33 largest sugar plantations receive over $1 million each year. The U.S. has generally supported free and fair trade. How can we justify artificially inflating the price of a domestic commodity just to enrich and protect a particular industry? This legislation would not impact existing rules on tariffs and quotas. Therefore, there would be no dumping of foreign sugar into the U.S. market. Like most Americans, I strongly support reducing the Federal budget deficit. Due to import tariffs and a 1.1 cents-per-pound tax on producers, the sugar program operates a no-net-cost to the Federal budget. While this is true, the program costs the American taxpayers $1.4 billion. The sugar program is a regressive tax, which imposes a much greater burden on those who spend a great deal on consumption. Under the present system, the benefit of reducing the Federal budget deficit is far outweighed by the high cost to the American consumer. One of the greatest environmental crises facing the State of Florida is the degradation of the Everglades. The Everglades is a national treasure, which is threatened by phosphate and pesticide runoff. The sugar program's continued high price supports have for years stimulated overproduction in the Everglades agricultural area. In effect, the Federal Government has encouraged the destruction of the Everglades through heavy-handed government intervention and misguided attempts to regulate the economy. The repeal of the sugar program would have a minimal, if any, impact on jobs in the sugar industry. The American sugar industry, the pro- sugar lobby, has estimated a job loss of 420,000. This is factually and statistically untrue. The Census Bureau and the USDA have estimated that the sugar industry only accounts for 46,000 jobs. In fact, even with the program, sugar industry jobs fell by 18 percent between 1982 and 1992. It is believed by many economists that any job losses in the sugar industry would be offset by gains realized in the sweetener industry. Mr. President, the time for wasteful and inefficient commodity programs like the sugar program has come to an end. I hope the Senate will move quickly to pass this legislation and send a message to the relatively few that benefit from this program that the American consumer deserves a better deal.