Orrin Hatch

Mr. HATCH

Mr. HATCH. Mr. President, I rise today to introduce the Software Export Equity Act. I am pleased to be joined in this bipartisan effort by my colleagues on the Senate Finance Committee, Senators Max Baucus, Don Nickles, John Breaux, as well as Patty Murray, Slade Gorton, Dianne Feinstein, and Barbara Boxer. Identical legislation has been introduced in the House by Representative Jennifer Dunn and a strong bipartisan group of her House colleagues. This bill highlights an issue that I have mentioned many times in the Finance Committee. Currently, the section of the Internal Revenue Code outlining what qualifies for foreign sales corporation [FSC] treatment and tax benefits is unclear and has left out software that is exported overseas. Our bill would clarify the treatment of software. What is a foreign sales corporation? It is a corporate entity established by Congress to help facilitate the export of American made goods to foreign markets. The FSC rules allow a corporation a tax benefit on a portion of its earnings generated by the sale or lease of export property. It is consistent with sound U.S. policy to promote U.S. exports. When the foreign sales corporation statute was enacted in 1971, the computer software industry was relatively new. The original FSC statute was drafted with the intent that only U.S. job-creating property manufactured or produced in the United States and sold or leased outside the United States qualifies for export benefits. The FSC rules are designed to assist U.S. exporters in competing with products made in other countries that have more favorable rules for taxing exports. Mr. President, it is in our best interests to encourage the export of American goods and services. The United States is currently the world leader in software development, employing approximately 2 million people in software development jobs. As this industry continues to grow, much of the expansion of the industry is due to the growth of exports. However, as the software industry has grown in response to global markets, the tax laws have not kept up. Currently, the statute allows films, tapes, records or similar reproductions to qualify for FSC benefits. However, because of a narrow interpretation of the FSC rules, software does not generally receive this export incentive. Let me provide an example that I have shared before with my colleagues on the Finance Committee. Suppose you have two CD-ROM's--one containing a musical recording, the other containing dictionary software with musical recordings included. The two look the same and are very similar except for the software. If the you export a master CD-ROM of the musical recording to another country for reproduction, the export qualifies for FSC benefits. However, if you export a master copy of the software CD-ROM with a license to make additional copies, you will be denied FSC benefits. This is simply wrong and unfair. In an age where many computer products are multipurpose--with music and software--this makes no sense. Now this problem is not beyond repair. The Treasury Department does not believe that it has the authority to issue regulations to correct this problem. However, they support the legislative fix I am introducing today. The FSC statute must be clarified to allow exported software with the right to reproduce to receive fair and equitable treatment. Mr. President, this problem hits home in my State of Utah. There are a number of software manufacturers in Utah that have developed a worldwide presence. Watching musical and other intangible items receive FSC treatment while highly sophisticated software is left out, is simply discouraging for these sometimes small software companies. This legislation corrects this inequity and reestablishes our commitment to promoting American competitiveness. I am please to introduce the Software Export Equity Act today. I urge all of my colleagues to support this bipartisan effort and cosponsor this bill. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. HATCH

Mr. HATCH. That ought to be enough to make some fairly powerful statements, but I will be happy to give him some more time after I make a few remarks. Let me make a point that my good friend and colleague, Senator Kyl, made at the outset of this debate. Senator Kennedy's amendment would allow the Federal Government to imprison any taxpayer who declines to pay an unconstitutional tax. His amendment is materially different from Senator Nunn's amendment 2 years ago. So I am very concerned about it. Let me just compare the two. The Nunn amendment provided that absent specific legislation authorizing judicial review, the courts would not have jurisdiction for claims arising under the balanced budget amendment. The Kennedy amendment provides that absent specific legislation authorizing judicial review, Congress has exclusive enforcement authority under the balanced budget amendment. Thus the courts would have absolutely no enforcement role. The difference is this. I know my colleague is trying to do what is right here, but the difference is this. The Kennedy amendment allows Congress unconstitutionally to raise taxes by a simple voice vote and no court in this land could hold that tax unconstitutional. The Nunn amendment did not have that draconian affect. Under the Nunn amendment, any taxpayer could raise as a defense the argument that the Congress passed an unconstitutional tax. The Kennedy amendment forecloses that defense. I do not think we want to go that far, even though I think I know what the distinguished Senator is trying to do. The Kennedy amendment, Senator Kennedy's amendment, would allow the Government to imprison taxpayers for refusing to pay an unconstitutional tax. I do not think we want to go that far. At least I do not. So I have to rise in opposition to the amendment offered by my good friend and colleague from Massachusetts. Mr. President, in each year that the balanced budget amendment has been debated, I notice that various arguments are presented as scare tactics by the opponents of the amendment. The devil resurrected now in the Kennedy amendment is the fear that under the balanced budget amendment the courts will raise taxes or cut programs. Indeed, President Clinton even claimed that he could refuse to disburse Social Security checks to our retired senior citizens if the budget is not balanced by the end of any particular fiscal year. The balanced budget amendment does not produce any such evils. On the contrary, the balanced budget amendment strikes a delicate balance between the reviewability by the courts and limitation on the courts' ability to interfere with congressional budgetary authority. It has always been my position that we should not foreclose all judicial review. No. Some judicial review may be necessary and should be permitted. What we should foreclose is any action by the courts that would interfere with Congress' budgetary authority. Judicial review should be available for the egregious, but unlikely, cases where Congress flouts the express procedures dictated by Senate Joint Resolution 1, such as the requirement that each House of Congress vote for a tax increase only by rollcall vote, when in fact we provide for a constitutional majority or a majority of the whole number of both Houses in order to have a tax increase. Such review does not mean that the courts will be able to interfere with the budgetary process but does ensure that the Constitution is enforced and respected. Let me explain this balance in greater detail. There are several reasons why courts will not run the budget process if Senate Joint Resolution 1 becomes law. In part, that is because several well-settled constitutional principles ensure courts do not make the budget decisions that we must make. In part, that is because section 6 of Senate Joint Resolution 1 gives Congress the power to decide how the balanced budget amendment should be enforced. Let us start with the Constitution. No. 1. Standing. The standing doctrine limits who may bring a lawsuit in Federal court. At bottom, to do so a party must show that it has suffered an ``injury in fact.'' That term is a technical one in the law. It does not allow clients to simply claim he dislikes a law or merely that the law is unconstitutional. No. A plaintiff must prove three elements in order to establish standing or to show, as I have mentioned before, that that plaintiff has suffered ``injury in fact.'' First, a plaintiff must prove that he has suffered, or likely will suffer, a concrete injury, not just a conjured up one or abstract one, but a concrete injury. Second, the plaintiff must show that the defendant has caused the specific injury that he has shown. In this case it would be the Government. And third, the plaintiff must show that the remedy he seeks will redress the specific injury that he has shown. It would be very difficult for a plaintiff to establish or any plaintiff to establish all three elements in a lawsuit brought challenging an action under Senate Joint Resolution 1 unless there was an actual violation of Senate Joint Resolution 1 such as I have mentioned--a refusal to follow the supermajority vote rule or a refusal to follow the actual vote rule. Dissatisfaction with Congress' policy judgment is not ``injury in fact.'' A plaintiff, therefore, cannot establish the ability to sue if all that a plaintiff can show is that Congress has not adequately funded or has been unduly generous in funding a particular program. A plaintiff cannot establish standing based merely on the claim that an act of Congress is unconstitutional. A plaintiff also cannot establish standing based simply on his or her status as a taxpayer. The Supreme Court long ago held that a plaintiff cannot establish standing based merely on his status as a taxpayer. The Court so ruled in the 1923 case of Frothingham versus Mellon. In 1982, the Supreme Court reaffirmed its Frothingham decision in the case of Valley Forge Christian College versus Americans United for Separation of Church & State. That is not all. Even if a party can prove he has suffered a judicially recognizable ``injury in fact,'' in all but the most extraordinary cases that party still would not be able to establish standing to sue. The reason why is that a plaintiff still could not make out the remaining requirements to establish standing. In particular, a party would not be able to establish either the ``causation'' or ``redressability'' elements. In a case brought under the balanced budget amendment, a plaintiff would not be able to show that a specific law caused his injury or that a specific law should be held invalid as the unconstitutionally necessary and appropriate remedy. After all, Congress appropriates money for numerous programs, so it would be impossible for a plaintiff to show, for example, that he is injured by any one specific program. Now, that is No. 1. No. 2 is justiciability and the political question doctrine. There are two other doctrines that are relevant here: Justiciability and the political question doctrine. Justiciability focuses not on the person who wishes to bring a lawsuit, but on the issue or claim that the plaintiff wishes to litigate. Not every claim is one that Federal courts are going to adjudicate, and claims that cannot be adjudicated are deemed ``nonjusticiable.'' In many ways, the political question doctrine is just the flipside of the justiciability doctrine. The reason is that a political question is an issue that the Constitution has given to someone other than the courts to decide. The political question doctrine is relevant here because of the origination clause in article I, section 7, clause 1, of the Constitution that provides that ``All Bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.'' Because that clause gives to the House of Representatives specifically the exclusive power to decide whether to raise taxes, the courts cannot do so, even in a case that the courts otherwise may adjudicate. Because this is an important issue, let me just address it in some detail. I will refer to the judicial taxation issue of Missouri versus Jenkins. Can Federal courts order a tax increase? Some opponents of the balanced budget amendment have argued that the courts will use their remedial power to order that Congress raise taxes. In making that argument, some balanced budget amendment opponents rely on the Supreme Court's decision in Missouri versus Jenkins, a decision decided in 1990. There the Supreme Court held that a Federal district court has the remedial authority to order a local school district to raise taxes in order to ensure that a court-ordered school desegregation plan is carried into effect. The Jenkins case, however, supplies no authority for a Federal court to order Congress to raise taxes. The short and simple answer is that the text of the Constitution treats the Federal Government and the States differently in that regard. The Supreme Court did not discuss the effect of the origination clause of the Constitution in the Jenkins case, and that clause is critical to any discussion of this issue. The origination clause of the Constitution provides that ``All bills for raising revenue shall originate in the House of Representatives, but the Senate may propose or concur with amendments, as on other bills.'' That provision is not a mere matter of etiquette. No, the Supreme Court has said that it is a substantive, judicially enforceable constitutional requirement. And we, in the Senate, are very diligent in making sure that we do not tread on the House's authority to do that. All of us understand that, and we are very, very concerned about observing it. In United States versus Munoz-Flores, in 1990, the Supreme Court ruled that the courts can enforce the requirements of the origination clause. In that case, the Supreme Court rejected the argument that issues arising under the origination clause pose what are known as ``political questions,'' questions that are for the political branches, not the courts, to resolve. The upshot of the Munoz-Flores decision is twofold. First, all bills for raising revenue must originate in the House of Representatives, or else they are unconstitutional. Second, and more importantly, the House of Representatives has plenary authority for the ``origination of revenue bills.'' No entity created by the Constitution other than the House of Representatives can originate a revenue bill or order that a revenue bill originate in the House. That includes the Federal courts. Since the Supreme Court is created by the Constitution and since the lower Federal courts are authorized by the Constitution, neither the Supreme Court nor any lower Federal court has the power to order the House to raise taxes or, in any other way, to order Federal taxes raised. The same point can be made in another way. Under the political question doctrine, the Federal courts lack authority to adjudicate certain types of issues. The classic formulation of a ``political question'' case is set forth in Baker versus Carr in 1962. That formulation makes clear that a political question is an issue in part whose resolution is textually committed to a branch other than the courts. The issue whether taxes should be raised easily satisfies that standard, because the origination clause expressly vests that authority in the House of Representatives. At the end of the day, the question whether taxes should be raised is quintessentially a political question, because the Constitution expressly vests in the House of Representatives the authority over that issue. Since the resolution and political question is beyond the demand of the courts, no Federal court could order Federal taxes to be raised as a remedy in any case. Accordingly, the Supreme Court's decision in the Jenkins case is irrelevant in this contest. The principle that Federal courts cannot order taxes to be raised is consistent with the Framers of our Constitution. Let me quote from ``The Federalist Papers'' to make my point. James Madison wrote in Federalist No. 48: ``The legislative department alone has access to the pockets of the people.'' Similarly, Alexander Hamilton wrote the following about the courts in Federalist No. 78: ``The Judiciary has no influence over the sword or the purse, no direction either of the strength or of the wealth of the society, and can take no active resolution whatever.'' Those are important Founding Fathers' definable terms with regard to this particular issue. It is very important that we make this case, because there is a lot of misunderstanding on this constitutional issue. Now, No. 3, an additional safeguard against judicial activism lies in article III of the Constitution and section 6 of Senate Joint Resolution 1. Both provisions give Congress power to limit the jurisdiction of the courts and the remedies courts may provide. The Supreme Court has made clear on numerous occasions under article III that Congress can limit the jurisdiction and remedial powers of the Federal court. Under section 6 of the balanced budget amendment, Congress may adopt statutory remedies and mechanisms for any purported budgetary shortfall such as sequestration, rescission, or the establishment of a contingency fund. Pursuant to section 6, it is clear that Congress, if it finds it necessary, could limit the type of remedies a court may grant or limit a court's jurisdiction to prevent judicial overreaching. If the balanced budget amendment becomes law, and I hope it does, Congress will have the authority of both article III and section 6 of the balanced budget amendment in order to protect against unwarranted judicial action. Those two provisions help to ensure that Congress will retain the ultimate power to decide how Senate Joint Resolution 1 will be enforced and thereby prevents courts, whether Federal or State, from expanding their power beyond the limited role Congress assigns. These are issues that are important and have to be covered in the context of this debate. Some opponents have argued it would force the President to impound funds; that is, to withhold from spending already appropriated funds such as Social Security payments in order to balance the books. President Clinton has made that argument on several occasions recently. He made it in his State of the Union Address and he made in his Saturday radio broadcast. Shame on him, having taught constitutional law. I shall now explain that argument is a canard. Constitutional analysis, like all legal analysis, begins with the text of the relevant law. Here we need to look to the text of Senate Joint Resolution 1. That part of the analysis is conclusive. Nothing in the text of Senate Joint Resolution 1 authorizes, or otherwise allows, for the impoundment of any appropriated funds. On the contrary, it imposes a duty on the President, the duty to transmit to Congress a proposed budget for each fiscal year in which total outlays do not exceed total receipts. The text of Senate Joint Resolution 1 is clear: It does not authorize the President to impound appropriated funds of any type. We should now move on to the intent of the drafters of Senate Joint Resolution 1. Here, too, the answer is compelling. Neither I nor anyone else who supports Senate Joint Resolution 1 in this Chamber construes the balanced budget amendment as granting the President any authority to impound funds. That should end the debate. Now, under section 6 of Senate Joint Resolution 1, Congress must mandate exactly what enforcement mechanism it wants, whether it be sequestration, rescission, the establishment of a contingency, or rainy day fund, or some other mechanism. The President must enforce whatever mechanism the Congress enacts so Congress has the power to prevent the President from impounding funds. Indeed, even if Congress took no preventive action in that regard, the President could not impound funds if Senate Joint Resolution 1 became law. The reason why is that the Line Item Veto Act prevents the President from doing so. Let me explain why in three steps. First, unlike Gaul, all Presidential powers can be divided into two parts. Expressed powers such as the pardon power, or implied powers, which consist of every constitutional power that the President can invoke, that is not expressly granted to him. That is the complete universe of Presidential powers according to the Constitution. So any power to impound funds must fit into one of these two categories. Second, the Constitution grants the President the power to issue a pardon, but it does not grant him the power to impound funds. As a result, if the President has any impoundment power, that power can only come from the President's general executive power in article II, section 1, or in his duty in article II, section 3, to ``take care that the laws be faithfully executed.'' Third, how the President's impoundment power is classified is important, because Congress has greater authority to regulate the President's implied powers than his expressed powers. Congress has only very limited authority to regulate the President's exercise of an express power such as the pardon power of article I, section 2, clause 1. But Congress has greater room to regulate the President's general executive power. In fact, Congress may do so as long as Congress does not prevent the President from discharging his assigned responsibilities. Indeed, Congress already has regulated in the area of the President's implied powers by giving the President a line-item veto power. We gave the President such authority last Congress. As a result, even if Congress does nothing more to enforce the balanced budget amendment, Congress already has limited the President's ability to impound funds. Why is that so? Well, it is because Congress told the President that the only budget authority that he can exercise is the line-item veto power. The Congress gave the President that power, rather than the impoundment power, only last year, and that judgment by the Congress is naturally entitled to respect. By so granting the line-item veto power, Congress impliedly denied to the President the power claimed by President Clinton to impound funds. The one power implies that the other does not exist. Now, these are important issues, and I have to say they are issues that literally, I think, must be stated against the amendment of my friend from Massachusetts in this particular case. Mr. President, let me just end where I began. There are only two ways to assert constitutional claims. One, you can sue the Government; two, you can raise constitutional claims as a defense. Simply put, the Kennedy amendment would not allow the latter. You could not raise a constitutional defense. Imagine, the Leviathan IRS can prosecute an innocent taxpayer and the taxpayer can't tell the court that the IRS is acting unconstitutionally. Can you imagine that? We just could not put that in the Constitution. It would be awful. The Kennedy amendment does exactly that. This, alone, is a good reason to table Senator Kennedy's amendment. Taxpayers have rights, too and, frankly, the current amendment, Senate Joint Resolution 1, the balanced budget amendment, protects those rights, whereby, the amendment of the distinguished Senator from Massachusetts does not. Now, my friend from Massachusetts may not worry so much about some of the excessive powers of the IRS. I suspect he doesn't have too many worries there, compared to people who are scraping for a living every day of their lives. Be that as it may, that doesn't mean we should justifiably put this into the Constitution by amending the balanced budget amendment with this amendment. Mr. President, how much time do I have remaining?

Mr. HATCH. Mr. President, I do not intend to take much time on this amendment. My colleague deserves certainly some response. This motion would alter the constitutional amendment and make it into a statute. I do not know if we need to say anything more because we are debating a constitutional amendment. The distinguished Senator from Arkansas is very ingenious. He is a great friend of mine; I appreciate him, but this motion very simply says, ``We do not need a constitutional amendment to balance the budget.'' Now, I insist that we do when you look at these 28 years of unbalanced budgets. I hate it when people come in here and say, ``Let's just do it.'' I have heard that throughout this debate. ``Let's just do it''--the very same people who basically have never done it the whole time they have been in the Senate. That is not quite true because Senator Byrd was here, I suspect Senator Kennedy was here and maybe some others. Frankly, many of these people, I have never heard them ask: Where is the money coming from to pay for these spending programs? This motion says we can guarantee the fiscal discipline necessary to make balanced budgets the rule rather than the exception simply by enacting statutory changes to the Budget Act. As I said, I do not doubt that my colleague believes this and that he is sincere in offering this motion, but I must say that the proponents of this motion are dead wrong. The problem with this motion is that it puts us back to square one, forcing us to rely, as we have done time and time again, on statutory fixes to ensure fiscal responsibility. We have been down this road before, Mr. President, and the result is right here in front of me--28 unbalanced budgets in a row; 58 of the last 66 are unbalanced budgets. Just think about it. In the last 66 years, 58 years we have had an unbalanced budget. In every one of those years we have had people say, ``Let's just do it. Let's do it statutorily.'' Well, the time has come for a solution strong enough that it cannot be evaded for short-term gain. We need a constitutional requirement to balance the budget. The sad history of legislative attempts to balance the budget shows the need for a constitutional amendment requiring a balanced budget. Since 1978, we have adopted, as I have said many times on this floor, no fewer than five major statutory balanced budget mechanisms such as the distinguished Senator is putting forth here sincerely, none of which have worked. We have 28 straight years of unbalanced budgets. We have had statutory regimes for each of those 28 years, none of which has worked. Since 1978, we have adopted those five statutory regimes which promised faithfully to bring about balanced budgets. Every one of those failed and they failed miserably. Time after time, statutory fixes have met with increased deficits. Here it is. It does not take any brains, you do not have to be a rocket scientist to realize we do not have the guts to do what is right under the status quo, without the balanced budget amendment. Some people do not think we even have the guts to pass a balanced budget amendment. Well, in fact, nearly 85 percent of our current national debt has accumulated while Congress has operated within statutory budget frameworks designed to assure balanced budgets. The fact is we can never solve these problems through the enactment of mere statutes because statutes do not purport to correct the structural bias in favor of deficit spending. Statutes are only able to deal with temporary crises. Let's take a look at just a few of those statutes. In 1978, my first year here in the U.S. Senate, we passed the Revenue Act of 1978, P.L. 95-600. Section 3 of that act was straightforward. It stated: ``As a matter of national policy * * * the Federal budget should be balanced in fiscal years 1982 and 1983.'' But, if you look carefully, Mr. President, you will find the Federal budgets for each of those years in this stack here in front of me. In 1982 we ran a budget deficit of $128 billion. In 1983, our deficit was even higher at $208 billion. This while it was our national policy--as declared in statute enacted by Congress and agreed to by the President--that our budget should be balanced in each of those years. Now that is not to say that Congress was not serious about reaching balance. I was here and I can tell you that we were. In fact, later in that same year, 1978, we adopted an amendment offered by our former colleague Harry Byrd, Jr., from Virginia, which stated that ``[b]eginning with fiscal year 1981, the total budget outlays of the Federal Government shall not exceed its receipts.'' Two years later, in 1980, we modified the Byrd amendment to state that ``[t]he Congress reaffirms its commitment that beginning with fiscal year 1981, the total outlays of the Federal Government shall not exceed its receipts.'' You will notice that in reaffirming our commitment to a balanced budget we changed the language from saying that Congress ``should'' balance the budget to say that Congress ``shall'' balance the budget in 1981. And yet, Mr. President, the Federal budget for 1981 is also one of the 28 unbalanced budgets in this stack here in front of me. This again, is not to say that Congress' commitment to balancing the budget was in any way diminished. In 1982 we revised the Byrd amendment once again to say that ``Congress reaffirms its commitment that budget outlays of the United States Government for a fiscal year may be not more than the receipts of the Government for that year.'' And yet, Mr. President, the budget for every year since that commitment was enacted into statute is in this stack of unbalanced budgets. Perhaps the most well-known statute designed to ensure a balanced Federal budget was the Gramm-Rudman-Hollings Act of 1985. Many of my colleagues remember this act well. It was touted as the deficit reduction package to end all deficit reduction packages. I supported that legislation, and I held out great hope that it would actually bring us into balance for what then would have been the first time in 22 years. Much like the motion before us, the Gramm-Rudman-Hollings Act amended the Budget Act to provide for a point of order in the House or Senate against any budget resolution that exceeded certain deficit reduction targets. These declining deficit targets were to put us on the so- called glidepath to balance in fiscal year 1991. A point of order under this legislation could only be waived by a supermajority vote. The singular exception was for circumstances in which a declaration of war was in effect. That's pretty tough language, Mr. President. And it was backed up by an automatic sequestration mechanism to ensure that the deficit reduction targets were met. That's why so many of my colleagues and I supported the Gramm-Rudman-Hollings Act. And yet that law, Mr. President--the deficit reduction package to end all deficit reduction packages--was slowly amended, circumvented, and the requirement for a balanced budget finally eliminated altogether just one year prior to the year in which we were to achieve balance under the original act. As a result, we have now amassed an additional $1.3 trillion in debt since 1991. Mr. President, the Bumpers motion offers no better promises than the Gramm-Rudman-Hollings Act. Ultimately, as experience has shown, no Congress can bind a succeeding Congress by simple statute. Any balanced budget statute can be repealed, in whole or in part, by the simple expedient of adopting a new statute. Statutory limitations remain effective only as long as no majority coalition forms to overcome such statutory constraints. Now I know my colleagues have argued that things are different now than they were under Gramm-Rudman-Hollings. They cite too the fact that we have experienced four consecutive years of deficit reduction and that Congress and the President agree that the budget must be balanced. But the American people have plenty of reasons to be skeptical of this argument. Under the budget the President has proposed, we will have deficits larger than last year's budget deficit until the year 2000. Only in the last 2 years of his budget do we see the dramatic cuts necessary to bring us into balance. In other words, a full 75 percent of the deficit reduction planned in President Clinton's budget comes in the 2 years after he leaves office. Is this the sort of glide path to a balanced budget that is envisioned by section 1 of the Bumpers motion? This to me, Mr. President, is not the sort of commitment to balancing the budget that would support the argument that we can rely on yet another statutory fix to bring about long-term fiscal restraint. The reliability of this commitment is only undercut by the Bumpers amendment, which would remove Social Security receipts and outlays from the balanced budget calculation--something the President himself has said cannot be done while still bringing the budget into balance in the year 2002, as is promised by the Bumpers amendment. The truth is that the Bumpers amendment promises only more of the same--year after year of machinations and evasion of responsibility to those of the future generations who must pay for our lack of budgetary discipline. Now, Mr. President, I do not wish to lay blame on Democrats or Republicans for the fiscal indiscretions of the past. The simple fact is that the problems in our current budget are not the fault of any political party, they are inherent in our political system. As our late colleague Paul Tsongas once said: [I]f you ask yourself why are these deficits always voted, the answer is very simple; that is, there are a lot of votes in deficit spending. . . . []The balanced-budget amendment is simply a recognition of that human behavior. It is not so much an indictment of the people who are here now as it is simply a reflection this is how people act in a democracy. They act to maximize their votes, and in this particular case, the addiction to deficit spending takes them in a particular direction.'' The fact is that we can never solve these problems through the enactment of mere statutes because statutes do not purport to correct this structural bias in favor of deficit spending. Statutes are only intended to deal with a temporary crisis. The deficit spending bias is not a problem that has lasted, nor will last, only a short number of years. It is a long-term problem that is deeply ingrained in our budget process. It demands a permanent constitutional solution. Senate Joint Resolution 1 is such a solution. It is a balanced, carefully crafted measure that has been developed in a bicameral, bipartisan fashion. I hope my colleagues will join with me in opposing the maintenance of the status quo and that they will vote to table the Bumpers motion. Having said that, I do get just a little uptight about people coming in here and blaming everything on Reagan and Bush. Yesterday, I had a debate with the distinguished Senator from West Virginia who tried to blame all of these deficits on Ronald Reagan and George Bush because during their tenure the deficits went up, and blame them on the tax cuts. I put into the Record yesterday evidence that those tax cuts, those marginal tax rate reductions actually resulted in a 40-percent, approximately 40-percent, increase in revenues because they stimulated the economy for 8 years, they contributed more jobs, more opportunity; 21 million jobs were created. They stimulated opportunity. They did a lot of things to get this country going again. But let me point out that during that whole time Reagan was in the Presidency, the Democrats controlled the House of Representatives. Tip O'Neil was in charge during the first part of that. And they kept spending. Now, I am not just blaming Democrats. There were liberal Republicans who helped them to do that as well. And there is no question that the increase in military spending did put pressures on the budget and that President Reagan was the one who did that. There is no question about that. But, on the other hand, if you think of the trillions of dollars that were saved because the Iron Curtain now has fallen and freedom has been restored to the East bloc countries, it probably was worth it. The blame should be on everybody. I don't think people should demagog this issue and stand up and say, ``It is Reagan and Bush who did this thing to us and created this $5.3 trillion debt.'' No, it is a continual, 58-out-of-66-year unbalanced spending process, during which time the Congress was controlled by liberals--let me put it that way, rather than Democrats and Republicans--liberals who spent us into bankruptcy. And during all of the Reagan years, the liberals did the same thing. Had we not continued to spend, those marginal tax cuts would have brought us out of the difficulties, except with the possible exception, at least as I view it, of the increases in the defense budget.

Mr. HATCH. Mr. President, I yield back the balance of my time. Are the yeas and nays ordered?

Mr. HATCH. I thank both my colleagues. Mr. President, I believe we should reject this amendment. Senate Joint Resolution 1 will not only help us to stop borrowing, but will help us to protect any savings we may build up. So, I do not believe it is necessary to make it easier to spend our hard-earned savings. Senate Joint Resolution 1 gives us appropriate flexibility with the appropriate protections. Mr. President, have we moved to table this amendment yet?

Mr. HATCH. Mr. President, I move to reconsider the vote by which the motion to table was agreed to.

Mr. HATCH. Mr. President, as my friend has said, I move to table this amendment. It unnecessarily reduces the time for ratification from 7 years to 3 years, even though that 7 years has been the proper form of ratification for many amendments since 1921. However long it takes, we need the balanced budget amendment and there is no reason to reduce the time for the consideration by the States. So I hope our colleagues will table this amendment.

Mr. HATCH. Mr. President, I move to reconsider the vote.

Mr. HATCH. Mr. President, I move to table and ask for the yeas and nays.

Mr. HATCH. I am prepared to yield back my time.

Mr. HATCH. Mr. President, how much time remains?

Mr. HATCH. How much is left for the other side?

Mr. HATCH. Let me just say for the sake of this debate, if the Senator were willing to vote for the balanced budget amendment, I would accept his amendment because I think three-quarters of the States would ratify this amendment within the 3-year time period. I know he will not vote for this balanced budget amendment, and, frankly, it is better from a constitutional standpoint to give the States enough time to function. Some States do not even meet this year in their legislatures; others meet, but may not have time to consider this. It does take time to ratify a constitutional amendment, depending upon a lot of timing factors. So we prefer to have the 7-year period. But I will make that offer if the Senator will vote for the balanced budget amendment. I would encourage all my colleagues to vote for his amendment, but until he does, I think we have to reject this amendment unless he is willing to do so.

Mr. HATCH. Mr. President, how much time is left for the Senator from Utah?

Mr. HATCH. I understand my colleague. I understand the amendment being offered by Senator Feingold would reduce the period for the States to ratify the balanced budget amendment from 7 to 3 years. I have to say, that I do not see the wisdom in departing from the longstanding 7-year standard that this resolution reflects. The 18th amendment, ratified in 1921, was the first constitutional amendment to contain a time limitation of any kind. Although there was heated debate at the time over Congress' authority to impose such a limitation on the States' ratification of the constitutional amendment, the Supreme Court subsequently upheld Congress' power to set a reasonable time limit on ratification in the case of Dillon versus Gloss back in 1921. As a result, we find 7-year time limitations within the actual text of the 18th, 20th, 21st and 22d amendments. Since approval of the 23d amendment in 1961, Congress has continued to include a 7-year time limitation. But such limitation has been removed from the text of the amendment and incorporated instead in the joint resolution proposed in the amendment as we have done in Senate Joint Resolution 1. Now, just to verify the continued adherence to the convention of a 7- year time limitation, I did a quick review of the 107 Constitutional amendments introduced in the last Congress. Indeed, of those 107 resolutions, only 1 contained a time limitation that varied from the conventional 7-year limitation. I am quite confident, were we to adopt a shorter time limit, as my colleague proposes, the amendment would still be ratified by an overwhelming number of the States. But I fail to see the need in this case to alter what has been recognized as a reasonable time limitation on ratification since the early part of this century or to prejudice the consideration of the balanced budget amendment by reducing the time for consideration. Mr. President, I am not concerned about 3 years or 7 years. I am concerned about 28 years, these 28 years of unbalanced budgets. You know, the bottom line is, we can talk all we want to about technicalities like 3 or 7 years but it is the 28 years I am concerned about. Really, if you get serious about it, it is 58 of the last 66 years during which we have had unbalanced budgets. It does not take a rocket scientist to realize this outfit just does not have the will to do what is right. So to get all caught up in whether it is 3 or 7 years, I do not think serves the best interests of this amendment. Let me just say the bottom line is this. Congress cannot and will not stop spending more than it earns without the force of a constitutional requirement to balance the budget. I have 28 unbalanced budgets here just to prove the point. We stacked them a little lower by doubling and tripling the smaller volumes, but it still is a pretty high stack. It is headed right to the ceiling if we do not get a balanced budget amendment. We have run deficits in 58 of the last 66 years. And, Mr. President, that is plain fiscal irresponsibility. For these reasons, I urge my colleagues to reject distractions such as this amendment. I do not mean to demean the amendment of the distinguished Senator or my colleague who serves well on the Judiciary Committee, and with whom I have a very good, friendly and decent relationship, but it is a distraction in the sense that really the 7- year period really ought to be maintained since it has been over all these years. So I urge my colleagues to reject this amendment and to find the courage to change the face of this Nation by voting for a constitutional amendment to balance the budget. This is a chance to do it. This is a chance to do something that will work. If we put the balanced budget requisite into the Constitution, I have no doubt that it will be a very relative few who would not observe it. But I believe the vast majority of Members of the Congress of the United States henceforth and forever would do everything in their power to live up to that constitutional requisite were we to put it in the Constitution. I have no doubt about it. I think the vast majority of people who serve here are very honorable people who keep their word and will do what is right. I really believe that if we put this in the Constitution, that vast majority will really make sure that this balanced budget amendment works. On the other hand, if we do not, my gosh, what hope do we have? I mean, I can just see where nobody could be seen above this stack 6 or 4 years from now. Frankly, I am absolutely solid in asserting, unless we have a balanced constitutional amendment, these stacks are just going to continue to grow ad infinitum, something that must be horrifying our Founding Fathers, many of whom are undoubtedly in Heaven, although there are a few I am sure who had a rough time getting there. But the vast majority of them probably are there with our Father in Heaven saying, ``Let's do that which we failed to do when we had the chance, even though we thought about it.'' But they, when they were here, never thought for a minute we would have 28 straight years of unbalanced budgets. So I suspect that the only way to solve this problem is to put some fiscal mechanism within the Constitution that makes sense. This amendment is that mechanism. It is a bipartisan amendment. I chatted with Charles Stenholm last night, our Democratic counterpart over in the House. I have to say he has done a tremendous job over the years doing his best to try to enact this amendment. It takes guts because he takes a lot of flak for it because people in his party in particular want to keep spending and taxing and claiming that they are doing a lot for people--they never say with their own money that could be better utilized by them and I think in a better way. So I want to praise him for the work he has done over there in the House, along with other Democrats and Republicans who have worked so hard through the years on this amendment. I want to praise everybody here who will vote for this amendment because it does--it does--hold hope for the future if we can pass this amendment and enshrine it in the Constitution where I think the vast majority of Members would honor it and do what is right. The spending games would be over. So I would hope that our colleagues will keep the language exactly the same. I do not know how it would affect other people who are currently willing to vote for the amendment, but we would like not to change it. In spite of the fact that my colleague is sincere and that this is a sincere amendment, I would hope that our colleagues will vote to table it. Mr. President, I am prepared to yield back the balance of my time. We could move to the Senator's next amendment, unless he wants to discuss it.

Mr. HATCH. Eighty seconds?

Mr. HATCH. Mr. President, I know my colleague is sincere. I have nothing but respect for him as he serves on the committee. I have a lot of regard for the distinguished Senator, and he knows it, and I know it. However long it takes, we need a balanced budget amendment, and I think this is drafted correctly. It has Democrat prints all over it and Republican prints all over it. It is the bipartisan amendment that has always been in play, and I think should always be in play. Frankly, I am hopeful we can pass it by next Tuesday. But however long it takes, we need it. If we do not do it, we will continue the status quo, and that is a stack of unbalanced budgets, which my friend and colleague admits will continue if we do not do something about it. Mr. President, I yield back the balance of time, and I understand these votes will be stacked.

Mr. HATCH. I ask unanimous consent to move to table, with the understanding it will be able to come up at a later time.

Mr. HATCH. Would the Senator like me to yield him some time?

Mr. HATCH

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

Mr. HATCH. I suggest the absence of a quorum.

Mr. HATCH. I move to table the amendment, with the understanding that the vote will not occur until 12:35. I ask for the yeas and nays.

Mr. HATCH. I ask unanimous consent that I be permitted to move to table, with the vote not occurring before 12:35.

Mr. HATCH. Mr. President, I compliment the distinguished Senator from Florida. He has been one of the great leaders on the balanced budget amendment, prior to this debate and certainly during this debate. I believe he deserves a lot of commendation from both sides of the floor for his steadfastness and standing up on this amendment. We cannot support this particular amendment to the balanced budget constitutional amendment, and I regret that we cannot. But, in spite of that fact, our colleague from Florida has been one of the leaders out here, and I personally just want to express my appreciation for his efforts and for the work he has done on his side of the floor, as well as our side of the floor. I appreciate it. Mr. President, I understand that the vote cannot occur until 12:35?

Mr. HATCH. Mr. President, I think this side has said everything it needs to say. I will be happy to yield any time of our remaining time, unless somebody else wants to speak, to our friend from Florida. We have to oppose this amendment. We know how helpful the Senator from Florida is and how much this means to him. We have appreciated the support he has provided in this debate and certainly will listen to what he says here. I yield the floor.