Judd Gregg

Mr. GREGG

Mr. GREGG. Mr. President, my point was that this will increase the piggy bank available to nondefense discretionary to be used for earmarking because it will take defense dollars and move them over to nondefense discretionary accounts. I don't argue with the argument that there is a significant number of earmarks in the defense budget. I hope that as part of reading his Defense Department earmarks--which I will be happy to agree exists--he will at the same time list the earmarks that were added into the Labor-HHS bill over the last 4, 5, 6 years as a result of literally billions of dollars being taken out of the Defense Department to pump up the Labor-HHS bill. That is where the earmarks occurred.

Mr. GREGG. Mr. President, so we can get the order, I understand we are going to go to Senator Bunning next; is that the game plan? He is on his way to the floor.

Mr. GREGG. I thank the Senator from Kentucky, who may be one of the most effective spokespersons in the Senate on the issue of protecting the Social Security accounts and making sure that as we move forward, we are responsible in that area. This amendment accomplishes exactly that. It is a brilliantly drafted amendment because it was, of course, drafted by the chairman of the Budget Committee and offered by him. Mr. Chairman, it reflects that the times have changed. Well, they really have not; the numbers have changed. Instead of $2 trillion, we are now talking $1 trillion of Social Security money that is going to be used in this budget. You know, the cattle are not out of the barn; they truly are in the barn. And we figure each cow is worth a dollar. We should be protecting them, and we should be at least addressing them. What I think the amendment does is it highlights the essence of one of the most significant problems with this budget; that is, although it spends a lot of money and it raises a lot of taxes, it does nothing on the issue of the long-term solvency of this Government, which is the most significant threat we face. The chairman of the Budget Committee has held numerous hearings on this issue. I have congratulated him on being focused on this issue. But, unfortunately, he brought forward a budget which does not address this. We have created a government which is not going to be affordable to our children because the costs of Social Security and the costs of Medicare when the baby boomer generation retires is simply going to overwhelm their fiscal ability to support that generation. We should be getting on right now and doing things that correct this. There were ideas put forward which would accomplish this that the President put forward in the area of Medicare. There are things you can do in the area of Social Security. For example, you can get the reimbursements correct on the COLA. But what this budget does is nothing. It does nothing to protect or address this outyear problem. What it does do is aggravate the problem by digging the hole deeper by using $1 trillion of Social Security funds to operate the Federal Government over the 5 years of this budget. So when the chairman of the committee drafted the amendment, he was thinking correctly. And when he said that--he was speaking here relevant to the use of Social Security funds by the administration in prior budgets--they included as the definition of a balanced budget one that raided the Social Security trust fund of every dime. Then he claimed that it was a balanced budget. That was no balanced budget; that was a budget built on massive borrowing disguised as balancing the budget. Well, that is essentially a statement which could be applied exactly to this budget. So the chairman was right with that statement. Then he went on further and said: It threatens Social Security to take $180- to $190 billion of Social Security money, to use it, instead of paying down the debt or prepaying the liability, to use to it pay operating expenses of the Government, it threatens Social Security. That again is being done within this budget to the tune of $1 trillion. So the Senator from Kentucky in his own way is once again highlighting the issue effectively and has put forward language which will accomplish the goal. It was good language when it was offered by the Senator from North Dakota, and it is good language offered by the Senator from Kentucky. I certainly hope we support it.

Mr. GREGG. Mr. President, I don't want to prolong the debate because the Senators from New Mexico and Tennessee have an amendment ready to go. But I would note that the most recent inconsistency on this is not our side, it would be on the Democratic side, in that the Senator from North Dakota voted against this amendment in committee, which he now is going to vote for on the floor. I wanted to make that point. So the inconsistency is in the eye of the beholder.

Mr. GREGG. Mr. President, I will conclude my comments by saying that I hope the Senator from North Dakota is not cynical, because of his rather negative view of what this amendment will do. I hope it does not come to fruition. I hope what the amendment does is force the people who bring the budget next year to look at Social Security and figure out how we are going to deal with it and thus put in place some entitlement reform which addresses this issue and gets us into a position where we are able to protect it.

Mr. GREGG. I would. I understand the Senator from South Carolina wants to speak on the Bunning amendment. Should we complete that debate?

Mr. GREGG. Sounds good.

Mr. GREGG. Mr. President, as I understand it, Senator Collins expects to be here by 11:45 to present her amendment. Then, as I also understand it, at 12:30, we go to an hour which is agreed to and under the rule they have an hour certainly available to them on the Humphrey- Hawkins, and that would be Senator Brownback and Senator Schumer, I believe, who have that hour.

Mr. GREGG. We certainly want to accommodate Senator Baucus on our side.

Mr. GREGG. Madam President, I suspect I will support it, although I don't know, but I wish to ask the chairman of the Finance Committee a few questions so I get more specifics on the amendment. What is the total cost of this amendment?

Mr. GREGG. If I might ask, Madam President, further, of the chairman, the surplus, however, is in the year 2012. So what happens to these rates in 2011 that will expire? Are those picked up?

Mr. GREGG. Or 2010.

Mr. GREGG. Would it be appropriate--if I can ask the chairman of the Finance Committee or the chairman of the Budget Committee--I want to get to what the tax cuts are specifically, but they would be extended if they expired in 2010, 2011, or 2012, they would be extended through that period. If that is the case, then the Senator must be using more than the surplus in 2012. He must be using some number in 2010 by which you increase the deficit and 2011 by which you increase the deficit. My question is, what is the number the Senator is using for 2010 and 2011 to account for those extensions in those years?

Mr. GREGG. But how do they score in those 2 years?

Mr. GREGG. So there is another $60 billion on top of the surplus that is used; is that correct?

Mr. GREGG. I think I have the time for the purpose of asking questions.

Mr. GREGG. I yield to the Senator to ask whatever questions he has. I have additional questions.

Mr. GREGG. I think the answer to your question, if I might interject, is it increases the debt by $195 billion.

Mr. GREGG. That would have to be what it does. May I ask a further question of the Senator. It costs $195 billion over the 3 years to extend these tax cuts. Is the education tuition tax credit presumed in that number?

Mr. GREGG. If I may ask further, Madam President, would the expensing section 179 accounts be included in that number?

Mr. GREGG. In this number. Is capital gains contemplated in this number?

Mr. GREGG. Is continuing the dividend rate contemplated in this number?

Mr. GREGG. I thank the Senator. I think that answers my questions. I am presuming what is contemplated in this number then will be the marriage tax penalty and the child credits; is that correct?

Mr. GREGG. And the 10-percent bracket. I am presuming I certainly will be supportive of this amendment in its present form. However, I do suspect we are going to have an amendment which picks up the other extensions.

Mr. GREGG. It is the arbitrariness of the process around here that the Senator from Montana is first to the surplus that was left, but the practical effect of our amendment will be essentially the same as the Senator's, which is to extend the tax credit rates. That is tax deductions--tax rates. I also think the ones we are going to suggest we extend--and we will get to this in our debate--are ones which are more oriented toward economic activity, generating or creating economic activity, than the extensions which are included in the chairman's proposal, which are all good and appropriate but which don't translate other than through maybe greater consumption directly into economic activity, such as the capital gains and the dividend rate does, and the expensing, obviously. We will have that discussion when we offer ours, and I appreciate the chairman's courtesy in allowing me to ask him these questions.