Jim Jeffords

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Aviation Subcommittee of the Senate Committee on Commerce, Science, and Transportation be authorized to meet on March 9, 1995, at 2:30 p.m. on the Metropolitan Washington Airports Authority.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on the Judiciary be authorized to meet during the session of the Senate on Thursday, March 9, 1995, at 10 a.m. to hold a hearing on ``S. 227, the Performance Rights in Sound Recordings Act of 1995.

Mr. JEFFORDS. Mr. President, the Committee on Veterans' Affairs would like to request unanimous consent to hold a hearing on the nomination of Dennis M. Duffy to be Assistant Secretary for Policy and Planning for the Department of Veterans Affairs, and on the budget for veterans programs for fiscal year 1996. The hearing will be held on March 9, 1995, at 10 a.m., in room 418 of the Russell Senate Office Building.

Mr. JEFFORDS. Mr. President, I ask unanimous consent on behalf of the Governmental Affairs Committee to meet on Thursday, March 9, for a markup at 9:30 a.m. on S. 219, Regulatory Transition Act of 1995.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Thursday, March 9, 1995, at 2 p.m. to hold a hearing on the ``Overview of South Asian Proliferation Issues.''

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Finance Committee be permitted to meet Thursday, March 9, 1995, beginning at 9:30 a.m., in room 215 of the Dirksen Senate Office Building, to conduct a hearing on welfare reform.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be granted permission to meet during the session of the Senate on Thursday, March 9, 1995, for purposes of conducting a full committee business meeting, which is scheduled to begin at 10:30 a.m. The purpose of this meeting is to consider the nomination of Wilma Lewis to be Inspector General of the Department of the Interior.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on Thursday, March 9, 1995, at 10 a.m. to conduct a hearing on the Mexican peso.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet at 9:30 a.m. on Thursday, March 9, 1995, in open session, to receive testimony on the defense authorization request for fiscal year 1996 and the future years defense program.

Mr. JEFFORDS. Mr. President, I ask unanimous consent that the Committee on Agriculture, Nutrition, and Forestry be allowed to meet during the session of the Senate on Thursday, March 9, at 9:30 a.m., in SR-332, to discuss ``Farm Programs: Are Americans Getting What They Pay For?''

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, I thank the Chair. (The remarks of Mr. Jeffords and Mr. Leahy pertaining to the introduction of S. J. Res. 28 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, I rise today to strongly support the introduction of a joint resolution to grant the consent of Congress to the northeast interstate dairy compact. Congress is simply being asked to ratify a completed piece of legislation--legislation that passed overwhelmingly in each of the six New England States that the compact represents. Mr. President, a great deal of time and effort has gone into creating the dairy compact, over 6 years in fact. The dairy compact represents a cooperative effort of six States working collectively to restore the traditional Federal-State balance to milk regulation. The compact has been carefully designed so that it will not adversely affect any other region of the country. Provisions have been set forth in the compact to protect the interests of farmers and processors outside the compact region. In addition, there is no cost to the Federal Government. Mr. President, the dairy compact simply complements the Federal Milk Marketing Program. It would not supplant or replace Federal law. The compact regulates only fluid milk, which is milk for beverage use. Milk for manufacturing purposes such as cheese and ice cream would be absolutely exempt from the compact. We are talking about a very small amount of milk in a local market. Just since 1984, almost a third of the 3,170 farms then operating in Vermont have shut down. In 1994 alone, Vermont lost 148 farms and if the downward trend of milk prices continues we will lose more this year. Vermont dairy farmers are receiving milk prices well below the cost of production. Current milk prices for farmers are as low as they were 10 years ago, yet the cost of production and price to the consumer has increased. Farmers and consumers would both benefit from the compact's ability to establish a more stable price structure for the milk they produce and purchase, removing the fluctuations in fluid milk prices, assuring the region a viable supply of locally produced milk. The dairy compact is a unique partnership of the region's governments and the dairy industry supported by a broad coalition of organizations and people committed to maintaining the vitality of the region's dairy industry. The joint resolution being introduced today, has strong support from both sides of the isle. All 12 Senators from the New England delegation, representing producing and consuming States have come together to cosponsor this joint resolution. Mr. President, I can say with certainty, support for the dairy compact in New England is impressive. During the New England Governors' Conference winter meeting, all six New England Governors urged Congress to approve the dairy compact. A resolution of the New England Governors' Conference in support of congressional enactment of the northeast dairy compact was approved and signed by the chair of the New England Governors, Governor Steve Merrill of New Hampshire. The Governors of the compact region speak for not only the farmers and consumers but for the States themselves and the rights of the States. Mr. President, the message to Congress from Governors nationwide has been clear. ``Increase the flexibility of states and support legislation that promotes state and regional policy initiatives.'' Well Mr. President, this thoroughly thought out compact provides the opportunity for a partnership between Congress and the States to strengthen this fundamental federalism movement. It maintains that the States' constitutional authority, resources, and competence of the people to govern, is recognized and protected. Mr. President, I am certain that my colleagues will agree with me that dairy farmers deserve a fair price for their product. What does it say about our values when some of the hardest working people. our farmers, are underpaid and unappreciated? The people of New England have a right and deserve the chance to help themselves. The joint resolution that I am introducing today, along with Senator Leahy and my colleagues from New England gives the region the tools to face the challenges of improving and stabilizing farm prices. I urge my colleagues to respect this interstate cooperation and ratify the dairy compact. Mr. President, I ask unanimous consent that this one page fact sheet that explains and addresses the compact appear in the Record. Mr. President, I unanimous consent ask to have printed in the Record the resolution of the New England Governors' Conference.

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, I have listened to the very eloquent statements of my good friend from Kentucky. Certainly, all of us understand the need for the protection of the Social Security System. Certainly, I, like others, was torn when I had to vote on amendments that would be sacrosanct and separate from the possibilities of being tampered with by the balanced budget amendment. However, I can make the same kind of arguments on behalf of the children of this country for nutrition and the reasons why we should make sure that we do nothing that will endanger their ability to be protected from cuts which might damage their future. In a moment, I will talk about the care we must take when we make cuts, because if we do not recognize that education is so important to the foundation of our society and our economy, if we make mindless and unwarranted cuts in that, we will be counterproductive in the ability of us to balance the budget. However, I came to the conclusion in deciding to vote for the balanced budget amendment that we had to leave ourselves open to all options and that we could not pick and choose those things for which we ought to try to protect. And I understand and realize that it would be much easier for us to separate Social Security from it. Mr. President, on February 13, I came down to the floor to discuss my position on the balanced budget amendment. I outlined the concerns that increased debt load places on our economy and our future generations and how the interest payments we are making now on the budget are threatening everything else, now having exceeded the defense expenditures and the discretionary expenditures. I outlined at that time that in the past, in 1982, when I had been in the House only some 8 years, I was first faced with the balanced budget amendment. I said at that time, ``I won't vote for it because we can't wait 7 years for the budget to be balanced.'' At that time, we had just had a very important bill passed which greatly reduced the taxes of this Nation. I was the only Republican that opposed that amendment which made drastic cuts in our taxes, and I stated at that time that I was afraid that what we had done would lead to huge deficits in the future. I took a lot of abuse at that time for that vote. But, as history has shown, that vote probably was one that was the best judgment I could have exercised at the time. But, as we now know, it is important for us to pass the balanced budget amendment. We must begin to balance the budget and to outline our priorities. So we must be careful not to make balancing the budget more difficult. Today, I will talk about the need to be careful on how we cut, especially in the field of education. I am the chairman of the Senate Education Subcommittee and, therefore, have a particular responsibility to make sure that what we do from this point on does not in any way inhibit the ability of this Nation to be able to meet its commitments to its young, but most importantly its commitments to this Nation that we maintain our ability to be the most competitive and the most economically sound nation in the world. I am afraid, as I look across the Congress to see where cuts are being made. I also recognize the future needs of our Nation especially in the area of education. For without immediate attention by this Nation on our educational system, we are facing incredibe danger for our economic future. We cannot move forward without recognizing that cuts within the educational system may well prove to be counterproductive--counterproductive in that they will reduce the potential revenues that we would otherwise have and that they will only increase the social costs that we are presently experiencing. So let me now, as we go into the 21st century, take a look at where we are with respect to education and the need for us, a Nation, to place ourselves in more competitive position within the international economic community. In order for our country to remain viable in the global economy we must not only be free from crippling interest payments on our debt, but we must also prioritize our spending so that we maneuver ourselves to be ready to face the challenges of the new millennium. If we do not act now, we will destroy the dreams that we cherish--good health, a good education, a good job, and a good retirement. Some have proposed that we reduce the deficit simply by making across-the-board cuts on all programs. Such cuts might provide a solution to our financial woes in the short term, but they only exacerbate the deficit in the long term. Here is why. If we cut back on programs for education and training, we lose our competitive edge in the marketplace, resulting in a lower standard of living, fewer high paying jobs, less Federal revenues in taxes, and, naturally, a larger deficit. On the other hand, if we work to improve our education system, we not only increase our national productivity, but our standard of living will increase, resulting in greater Federal revenues and a decreased need to invest in our social programs. In Michael Crichton's recent book, ``Disclosure,'' the main character's professional advancement is threatened by the appointment of a woman as his supervisor. He is so distracted by the immediate problem of sexual harassment that he only belatedly understands the advice from an anonymous ally. That advice--to solve the problem. And he keeps repeating, ``Just solve the problem.'' I believe this advice applies to the larger problem that we face today. If we solve the larger problem, then this will solve those immediate ones that we look at with respect to our inability to fund the various programs we all desire to fund. For if we do not improve our educational system, and if we are unable to solve the deficit problem, we can not ensure that we have the capacity to provide for the programs we need. And then we will find that the problem of balancing our budget is unsolvable and that this Nation will disappear in the next millennium as a lesser nation. The way to solve the problem of our deficit is not, as some suggest, mindless across-the-board cuts. Solutions to our financial woes are long-term investments--specifically in our education system. By not solving the problem of reduced productivity and higher costs through education failures, interest payments will keep increasing, tax revenues will keep decreasing, and our deficit will only grow larger. More mindless cuts is not the answer. Instead, thoughtful investments and adequate resources are the solution to our long-term fiscal concerns. Consider for a moment the education spending patterns over the last decade. Since the beginning of the 1980's overall Federal support for education, after adjusting for inflation, has decreased by 5 percent. Funds for elementary and secondary education declined 15 percent, while postsecondary education funds declined 24 percent. Where has that led us? Certainly, not to the first class education system we all support. In fact, using the six education goals developed by a bipartisan group of Governors in 1989 as our barometer, we are not close to reaching our mark of excellence in education. Among the goals for our future is that our children come to school ready to learn, that they come without hunger, and that they come with the capacity to be able to understand the education that they are going to be faced with. That means they must first be fed, immunized, and, hopefully, have had some preschool experience. However, only 45 percent of young children from low-income families are enrolled in preschool programs and only 55 percent of infants have been fully immunized, protecting them against childhood diseases. Head Start continues to only serve one-fourth of all eligible children in this Nation. We also recognize that educated people who can compete in the global marketplace require a mastery in challenging core subject areas--such as math and science--and that all adults be literate and prepared for life-long learning. Unfortunately, in these basic areas, we are far from the finish line. The 1993 National Assessment of Educational Progress indicates more than 75 percent of students at all grade levels failed to achieve even the basic level of proficiency, and over 60 percent failed to meet the proficiency level in English. In international comparisons, American students consistently score below most other industrialized nations. In the 1992 international assessment of education progress U.S. 13- year-olds scored second to last among the nations in mathematics achievement, and similarly in science. More recently, a report recently came out that investigated the literacy of children that graduate from high school. The report found that 51 percent of the students now graduating from our high schools were functionally illiterate. That is, incapable of handling an entry- level job with their educational achievement. Make no mistake about it. These disturbing statistics are not about someone else's children. They are not someone else's problem. These are our children. These are our problems. Our future work-force and our future leaders. The quality of our public schools in America, is directly related to the standard of living of each and every citizen. Without a strong investment in education, this Nation will not be able to maintain an adequate number of highly-skilled workers, these workers are necessary if our country is to maintain a competitive position within the global marketplace. To give you a quick idea of why curing our educational ills is critical and key to our future, we will examine a yearly cost of our failing educational system. The total cost of our failure in education to our economy has been estimated to be one-half trillion dollars each year to our economy. The lost revenue alone has been estimated to be about $125 billion. That is, if the educational levels were where they should be, the income to the Nation, relative to furnishing our budget, could be higher by $125 billion, putting us a long ways towards being able to have the budget balanced. For example, American business spends approximately $200 billion a year to perform training for employees which is necessary to provide those individual minimum skills required to perform on the job, skills most of which should have been taught in the schools. The Department of Education estimates that 30 million Americans are functionally illiterate, another 46 million are marginally literate. This creates a significant problem for our economy. ``Combating Illiteracy In The Workplace,'' by Robert Goddard, puts the cost of this illiteracy at a staggering $225 billion a year. This includes lost productivity, unrealized taxes, crime, welfare, health, housing, and other social costs. We pay for our failed educational system every time an individual drops out of high school. Lack of a high school degree costs an individual $440,000 in lifetime earnings. These lost earnings often drive these individuals into welfare, crime, and drugs. Up to 80 percent of our people that are incarcerated in our State jails are functionally illiterate, school dropouts. Federal expenditures for welfare were $208 billion in the fiscal year 1992. The cost of incarceration, which I mentioned, is $25 billion per year and growing, and the medical costs of violent crime is another $18 billion per year. Illegal drugs cost the economy $238 billion a year, as estimated by Brandeis University. These difficult circumstances perpetuate themselves generation after generation. I think most Americans agree, and in poll after poll people cite the quality of education as a paramount concern. The support for education in these polls is often cited as one of the most important roles of Government. Americans understand intuitively that investing wisely in education is the key to our future success and the best possible national investment we can make for the country. The evidence is clear: Countries which spend more on education per pupil have higher levels of per capita GDP. Institutions like Motorola report corporate savings of $30 to $35 for every dollar on training. That is 3,000- to 3,500- percent rate of return. But most of that education, if you read the report, was to make their students literate to put them in a position where they could read. They found, amazingly in their study, they were having trouble with their employees answering simple math problems and they could not believe they do not have the capacity to do the math, when they found out the problem was they could not read the problems. Thus they had to teach them how to read to do simple math problems. That is the state of the situation, and that is Motorola, one who can be selective in their employees. People, as rational consumers, also realize investing in their own education leads to substantially higher lifetime earnings. A person with a bachelor's degree earns over 1.5 times of the person with a high school degree. A professional degree earns over 350 percent higher lifetime earnings than a high school diploma in itself. While we recognize both intuitively and through research the economic rewards of education, we do not simultaneously invest the funds necessary to support the position. Many of my colleagues, while acknowledging the importance of educational investments, argue that throwing money at education is not the solution. I could not agree more. Increasing educational expenditures in itself will not solve our country's educational deficiencies. We have a responsibility to invest educational dollars wisely, including more active congressional oversight over Federal initiatives. Simultaneously, we must also reinvigorate our schools by demanding that students learn to high academic standards. Why? Because the status quo in our schools has failed. Too many of our graduates finish school without knowing the three R's, much less more rigorous academic standards. Clearly, there is no room for federally mandated standards. We should be providing incentives for States and communities to set high goals for student achievement--pupil by pupil, and school by school. More importantly, they must know what standards this Nation must reach, if we are going to be able to continue to compete internationally. It is one thing to believe that our education, as most people in this country do, has improved over the time they were in school, and I find that is true for myself. I am amazed that the students in until college. What they do not realize, for instance, in a recent report on the comparison of our students to other nation's students we fared poorly. One example is with Taiwanese students. These students when they graduate are 2 years ahead of our students in many subjects, such as in math. Is it any wonder we come out last in these tests, or next to last? What is important is that we know and that the States know that we do have a problem. That this Nation is faced with a very serious educational problem, and if we do not do something about it, we will not be the Nation we must and should be in the next generation. So we must be sure that when we begin to reduce the budget to try and balance it that we do not do counterproductive cuts which will decrease our revenues and increase our social costs. Rather than cutting the deficit it will increase the deficit. This last dream can only be realized by setting high priorities on education and educational investment. These increases are essential if our country wishes to remain viable into and throughout the next century. Next, Mr. President, I would like to mention something else which I think is incredibly important. I think that we must realize if we are going to bring this deficit under control we must do something about escalating health care costs. This is an area that I and many of my fellow Members have been deeply involved in. I would say that we must realize that if we do begin to tackle our national health care problem, there is no hope for bringing the federal deficit under control. Mr. President, one of the only ways we can balance the budget is by getting the Federal health care expenditures under control. For example, CBO estimates that if we do not address the health care expenditures, the debt will grow by $1.4 trillion by the beginning of the next century, due to health care costs. The chart I have here for my colleagues to look at demonstrates what will happen if we do not get health care costs under control. I point out that the red line indicates current health care trends for Federal expenditures. Mr. President, 2 years ago I introduced a bill, worked very hard to demonstrate that health care expenditures can be brought under control. If this bill was passed into law that Federal health care expenditures could be brought under control and that the anticipated national debt could be reduced by $1.4 trillion over the next 10 years. That yellow line on the chart demonstrates what could be done if my plan was accepted last year. But that is not the only plan. That plan worked by shifting the burden of hospital care back to the States, capping our Federal expenditures and allowing the States through managed care and other processes to bring this under control. However, now it is important that we look at other measures. For instance, we found out this past year that with the Clinton bill, and bills like it which tried to go too far, we were not ready nor was our society ready to go that far. Let us take a look before we do that, take a look at why it is important that we do try and get the health care expenditures under control. First of all, let us take a look at the entitlements and mandates. This chart demonstrates in red what is happening to items such as Social Security, Medicare, and Medicaid, as we move into the next century. It demonstrates clearly that if we do not balance the budget, we cannot get the costs under control, and if we do not take care of our entitlements, we never will. The next chart shows the biggest component which is increasing at the most rapid rate, which is in yellow, is Medicare and Medicaid. As you can see, where that was a relatively small growth up through 1985, starting in 1985 things just escalated out of control. My point is that Federal health care has to be brought under control or there is no hope of balancing the budget. As I indicated in a bill 2 years ago, there is a method to do it. I am working now on another one that uses the private sector to demonstrate it can be done. Federal health care spending is projected to increase from 3.3 percent of the economy today--this is important, too--to over 11 percent by 2030. The growth of Federal health care costs poses an immediate and critical drain on our budget and thwarts our ability to balance the budget. The CBO projects that entitlement spending will be 58 percent of total Federal outlays by the year 2003, from 47 percent today. This represents an astounding 11 percent increase over 8 years. For unless appropriate policy changes are made by the year 2003, less than 15 cents of every dollar the Federal Government spends will be available for nondefense discretionary programs. And that includes education and programs for the poor, elderly, and disadvantaged Americans. We cannot let that happen. First, I want to outline some of the problems we face as we work to solve this dilemma. Medicare enrollment has been growing at an average annual rate of 2.2 percent per year since 1975, and is expected to grow at an annual rate of 2.1 percent through 1996. As the baby boomer generation reaches 65, beginning in the year 2010, the rate will rise even more. In fact, it will rise substantially more. Total Medicare expenditures have grown from $34 billion in 1980 to $160 billion in 1994. This means an average growth rate of 11.7 percent over this period. The CBO projects that Medicare expenditures will grow from $176 billion in 1995 to $286 billion in the year 2000. This represents an average annual growth rate of 10.2 percent over the next 5 years. Mr. President, this trend cannot continue or we will only expect this growth rate to continue to explode as our population ages and, again, the baby boomers will be, into the next century, raising the costs and the number of people to be treated by a substantial number. But if we work hard, we can start to get our Federal health expenditures under control. Second, Medicaid is also affecting our ability to balance the budget. Total Medicaid expenditures have grown from $41 billion in 1984 to $138 billion in 1994. The average annual growth rate from 1984 through 1990 was 9.8 percent, while the average annual growth rate from 1994 was 17.7 percent, an astounding jump. The CBO projects Medicaid expenditures will grow from $157 billion in 1995 to $262 billion in the year 2000. This represents a compound annual growth rate of 10.8 percent over the next 5 years. Currently, Medicaid consumes approximately 18 percent of State spending and approximately 6 percent of Federal spending. Like Medicare, we cannot allow this trend to continue. If we are going to reach the goal, and I believe we can, we must get health care costs under control. I expect and believe we can do that. I am working toward that, and I know others are, too, but we must remember we cannot do it without solving the health care crisis and improving the educational system. Finally, I would like to raise another spectrum with respect to the needs of what we must do to balance the budget and get health care costs under control, and that is in respect to the fourth dream which I mentioned, to start with, and that is that we have a good retirement. Just to give an idea of why it is incredibly important that we bring health care expenditures under control, some 10 years ago, the amount of money in an average benefit package was about 50 percent health care and about 50 percent pensions. Twenty years ago, 35 percent was for health care and 65 percent was for pensions. Now it is 21 percent for pensions and 79 percent of each benefit package for health care. If you also take a look, as others have been working on, as to what is going to happen to Social Security in the next century, if you add to that this dimension, that little money now being put into pension plans, the problems of the elderly will be exacerbated. So, in wrapping up and finalizing, I reluctantly back the balanced budget amendment. I do so with the firm conviction that if we improve our educational system, we do not mindlessly cut or eliminate programs, we can prepare ourselves for the next century. We can, to a large extent, allow our economy to continue to expand, thereby allowing our nation to grow its way out of this deficit problem, with increased More importantly, in the immediate area, we must dedicate ourselves this year to finding a solution to health care reform. If we do that, as I know we can, if we have the courage to do it because it will require shifts and it will require the understanding of the elderly population that they will be cared for in a betterand more efficient way, we will be able to bring the budget deficit under control in the not too distant future. I am hopeful that we can. For that reason, I will support the balanced budget amendment. Mr. President, I yield the floor. Mr. MURKOWSKI addressed the Chair.

Mr. JEFFORDS

Mr. JEFFORDS. I rise today in support of the balanced budget amendment. Mr. President, this vote has been described in historic terms. Only the historians can make that decision, but a brief description of our budget history might be instructive. In the heat of our arguments the past gets poorly presented. Thomas Jefferson was not in the United States when the Constitution was written. He was abroad representing the United States as our Minister to France. When he came back, he said, ``If I could add one Amendment to the Constitution, it would be to prohibit the Federal Government from borrowing funds.'' His reasoning was simple. ``We should consider ourselves unauthorized to saddle posterity with our debts,'' he said, ``and morally bound to pay them ourselves.'' Thomas Jefferson, as in so many other areas, was ahead of his time. For two centuries, this moral contract bound our predecessors. While debt was accumulated in times of dire national emergencies, in 1975 the debt stood at but $629 billion. Since then, we have increased the debt by more than seven fold, standing at $4.7 trillion today. The track record of the past two decades, more than anything else, has led me to the point where I now reluctantly support amending the Constitution to impose a discipline on Congress which we all wish it had but know it lacks. I agree with critics of the amendment that this is not something to undertake lightly. Since 1791, there have been over 10,000 constitutional amendments offered in Congress. During this time, only 22 of these 10,000 amendments have been deemed important enough by Congress to be passed. Of these 22, only 17 have been ratified by the States and have become part of the Constitution. interest spent on our debt What is the problem with our enormous debt today? The problem that exists today, Mr. President, is that the Federal Government owes more than $4.7 trillion. Therefore, we must spend over $800 million on interest every day--that's right, Mr. President, over $800 million on interest every day--and this does absolutely nothing for us to help the needs of all Americans. We send more to our bondholders in 3 days than we do to every man, woman, and child in Vermont over the course of an entire year, making Federal interest payments the second largest spending item in the budget. Mr. President, these interest payments are crippling our ability to adequately fund national priorities, such as education. We now spend five and a half times as much on interest payments than we do for all education, job training, and employment programs combined. We spend twice as much on interest payments than we do on all Federal programs for the poor. In 1950, the publicly held debt per family was $5,800, today the debt averages about $54,000 per American family. If we do not balance the budget by the year 2002, the debt burden per family will be a staggering $78,000. Interest on the debt is over $1,200 per person per year. At this rate, a child born today, living a normal lifespan of 75 years, will pay some $135,000 in interest on the debt. That assumes that no further debt is added and interest rates do not increase--both are highly unlikely. When I came to Congress in 1975, our gross interest expenditure totaled $49 billion. This year it is expected to be over $300 billion, meaning that today every dollar in personal income taxes collected west of the Mississippi is used to pay for interest on our national debt. The CBO estimates that in 10 years it will be over $650 billion and 35 percent of the revenue of the Federal Government will go just for debt service. This assumes that there will be no increase in the current interest rates. Since 1975, our national debt has grown from $542 billion to $4.7 trillion. It is expected to grow to $6.3 trillion by 1999--a 1,200- percent rate of growth since 1975. It this is the best case scenario, we must get hold of this enormous problem as quickly as possible. The only way I feel that this can be accomplished is by a balanced budget amendment. Back in 1975, every man, woman, and child owed $2,500 because of the debt. That figure now stands at over $18,000. It is expected that the amount of national debt that every man, woman, and child owes will increase by $5,000 over the next 5 years to a staggering $23,000. The last time we balanced the budget in 1969--only 9 cents of every Federal dollar went to pay interest. Today, 26 cents of every Federal dollar goes to pay for interest on the national debt. Furthermore, projections for our debt are frightening. It is expected to double to $9 trillion over the next 10 years. That means if we do nothing to balance the budget over the next 10 years, our interest payments will double to almost $2 billion a day. It is quite obvious that this trend can not continue. the national debt jeopardizes our economic future Mr. President, the greatest economic threat this country is facing is out-of-control spending by the Federal Government. Recently, the New York Federal Reserve Board reported that the Nation lost 5 percent in GDP due to the deficits in the 1980's--in other words our national income did not grow by an astonishing 5 percent. According to the CBO, 1 percent of growth is equal to creating 650,000 jobs. That means that the debt of the 1980's cost us over 3.5 million new jobs. Mr. President, every dollar that goes to pay for the interest of our national debt takes a dollar away from our economy to assist in productivity increases. Congress can not continue to do this to our national economy and, most importantly, to Americans. We can only guess where our economy would be if this Nation had a balanced budget amendment before the 1980's. The GAO recently released a report that a balanced budget by 2001 would 36 percent for every American's standard of living. Further, since 1960, the private savings rate has dropped from over 8 percent of our economy to 5 percent. During the same time, the Federal Government deficits have increased from less than 1 percent of the economy to more than 3 percent, resulting in a net national savings rate of less than 3 percent. On this note, the OMB reports that if we balance the budget over the next 5 years, the net national savings rate would increase to 6.1 percent. If nothing is done our national savings rate would be a mere 3 percent. Over the past 15 years, our expenditures in inflation adjusted percentages from fiscal year 1980 to fiscal year 1994 have decreased Federal spending for education by 13 percent and transportation by 2 percent. On the other hand, defense expenditures were up by 18 percent and entitlement expenditures, mainly Social Security and Medicare, were up by 50 percent. However, our gross interest payments have grown 120 percent. Mr. President, this trend can not continue if this Nation is going to be able to continue educating our children to compete in this global economy. If you were to ask what should the priorities of this Nation be? Let us just take a choice. Should we spend more money on education for the future of this Nation, or more money on interest? Well, it is clear what our choice would be--education. Yet, we have precisely reversed our priorities because we have been imprudent with our fiscal policy. savings and debt Why are deficits so bad for our economy? First, deficits tend to consume savings that we could use for truly productive investments. To fund these budget shortfalls, the Federal Government must keep borrowing, consuming limited capital. The resulting shortage of capital exerts an upward pressure on interest rates, recently done by the Federal Reserve, and further depresses economic activity. Second, the budget deficit is eroding our economic standing relative to the rest of the world. Raising interest rates and discouraging private investment, the deficit has continued to slow our economic growth in terms of our Nation's productive capacity relative to other nations. An excellent example of this is the cost American business pays to borrow capital, about 10 percent; compared to Japan, which can borrow money at under 5 percent. Clearly, American businesses are at a competitive disadvantage because of imprudent fiscal policies followed by the U.S. Government. Further evidence of this growing competitive disadvantage can be found during the 1980's, when thousands of American businesses made the decision that they cannot afford high interest rates on future investments--investing instead overseas, where interest rates were more affordable. Because of our lack of fiscal restraint, American firms are creating new jobs overseas and not in the United States. To further outline the economic incentives to relocate overseas a recent hearing on education and the economy highlighted the tremendous financial pressures placed on American investments. In his testimony, Alan Wurtzel, vice chairman of Circuit City Stores, Inc. stated that our poor education system provides very few qualified and skilled workers. For this reason, many firms find it more attractive to relocate overseas where a highly skilled work force can produce quality products without extensive job training or skill enhancement. Our performance in reindustrialization will continue to remain sluggish until we restore our economic health. This cannot be done when the Federal Government continues to run deficits. Without increased productivity in this Nation, our wages can not increase. Even more significant to our international position, our debt has been the principal factor in the Nation's trade deficits. The CBO recently estimated that over 50 percent of our trade deficit is from our Federal deficits. The CBO also reported that ``deficit reduction increases investments, which in turn increase the productive capacity of the economy. Moreover, deficit reduction lowers borrowing from abroad, which reduces the amount of income that is generated in the United States but flows to foreigners.'' Not surprisingly, our trade deficit remains a serious problem for our economy. the need for the balanced budget amendment Mr. President, some of my colleagues have asked why do we need to have a balanced budget amendment? They often cite the recent Treasury Department's study which indicates the possible effects on States and their finances if a constitutional amendment is passed. They often discuss the possible negative impact this amendment might have on their State. What this study does not discuss is what will happen to Federal spending if we do nothing. Or, if nothing is done to control Federal spending how this will adversely impact our childrens' future. What this study clearly shows is how far Federal spending is out of whack. The bottom line in this budget battle is what is best for our children. I believe that for the good of our children we must end budget deficits. Congress needs to learn what those in my home State's capital, Montpelier and all other State capitals, take as an article of faith--a balanced budget. Mr. President, a balanced budget amendment is necessary from just what I outlined above. That is, Congress, both Democrats and Republicans, are unable to make the tough choices necessary to balance the budget. A prime example of not making the difficult choices necessary to balance our budget can be found during the last Congress. Take for example, three battles last Congress on appropriation matters, as my colleagues will recall. One of these was an amendment to cut the defense budget by only $1 billion--only one-third of 1 percent. The second fight was on continued funding for the space station. The third fight was on increasing the grazing fees to lower Federal costs. How did we deal with these three appropriation battles? We compromised by passing everything, and that is what we do day after day, year after year, piling up the debt for our children's children to take care of. Over the past decade, the deficit numbers have worsened to the point that they are now deeply embedded in our budgets, in our priorities and even in our national consciousness. This constant barrage of deficit spending seems to have given us a sense of numbness, making us feel that it is now beyond our control and not in the interest of our national will. Finally, over the next few days I plan to discuss what Congress can and cannot do to balance the budget. First, I will discuss the desperate need to reinvigorate the American educational system. Our poor educational results remain a constant drain on our standard of living and economic growth. The cost to our economy is enormous, mainly through lost productivity and decreased revenue that results from our inadequate education system. Second, I will outline the need to carefully review and reform Federal spending on health care. As my colleagues know, about one-half of the deficit is related to increased Federal spending on health care. Mr. President, my experience is that unless we get firm control on these two critical problems, Congress will be unable to balance the budget and our Nation will continue to suffer lost economic growth. Our future will be dim. However, if we do as I believe we can, our future will be bright and prosperous. In the days ahead, I will show how I believe it can be done. Mr. President, in closing, I think we need to follow what Thomas Jefferson voiced some 200 years ago, we must pass a constitutional balanced budget amendment. Mr. President, I yield the floor. Mr. HATCH addressed the Chair.

Mr. JEFFORDS

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

Mr. JEFFORDS. Mr. President, if one is not aware of the history of this issue over the past decade or so, this amendment might seem like one that we ought to concentrate on and seriously consider. It brings up the issue of educational standards, but it takes our attention away from the basic reasons for the development of the Goals 2000. When these goals were developed by the Governors in 1989, it came as a result of a 1983 report called ``A Nation at Risk.'' That report was released by the Secretary of Education at the time, Ted Bell, who served as Secretary of Education during the Reagan administration. It described serious deficiencies in our educational system. Those results have been verified by many studies including the somewhat recent Work Force 2000 report which pointed out very importantly and very critically that this Nation is not presently prepared to compete in the international market and will be less so in the future. Here are some of the problems that created the demand for Goals 2000. Too many of our people right now do not even graduate from high school. But much more seriously is that only half of those who presently graduate have what is considered an acceptable basic education. Even more troubling is the fact that two-thirds of that half are functionally illiterate to one degree or another. They do not have the basic skills necessary to handle an entry level job. This means that our school system turns out millions of young people each year needing remedial education before they can effectively help us compete in the world economy. The purpose of ``A Nation at Risk'' was to raise awareness that our Nation was facing a serious crisis. The standard of living had been slipping for the past decade or more and would continue to slip if we did not raise the quality of our education. In the late 1980's, the business community was concerned that educational reform was not being implemented, even after President Bush had convened the national education summit and the Nation's Governors had created the goals which, with the input of Congress, are now referred to as Goals 2000. The need for progress on this issue was important to the business community. I remember very well the first meeting I had in my office as a new Senator and as member of the Education Subcommittee with a group of this Nation's top CEO's whose firms were involved in international ventures. I expected that they might come to me and say, ``We have to do something about capital gains.'' They did not. They said that we must fully fund Head Start. If the United States did not make sure that everyone had the advantage of preschool training, early childhood education, and other compensatory programs, we would not produce the kind of high school graduates who would be able to compete internationally. Our educational failures impact the business community, especially in those areas of graduate education which are so critical to our competitive edge in high-technology fields. Right now, about 40 percent of the slots for graduate schools in critical areas of science, engineering, and mathematics go to foreign students because they are more competitive for those slots. That used to be fine, and I remember in my own State we had many foreign students who went to graduate school and ultimately worked for IBM. These days, unfortunately, foreign graduate students are not staying here. They are not returning the advantage of their skills and knowledge to our industries. They are all going home. In other words, we are sending about 40 percent of graduates from our schools, which are the best in the world, to work for our competitors. I wished to raise this specter because this is the kind of problem which national standards should address. When we passed Goals 2000, we set forth a set of voluntary national goals and standards. In addition to the original goals proposed by President Bush and the 50 Governors, we expanded upon the goal for math and science competitiveness and added such subjects as history and arts. What we are talking about today is the beginning of a process of developing standards which are necessary for our ability to compete in the international economy. I would hate to think we will begin debating subjects which are important but unrelated to the more important issue of competitiveness and thereby disparage our national and worldwide standards. Recently, members of the business community spoke about job training before the Labor Committee and said that we must enforce worldwide educational standards for our people can become qualified for the work force of the future. If people do not understand the requirements, they will continue presuming that the standards which we have been utilizing, the ones which we feel are an acceptable education, are quite all right. People fail to realize that students in Taiwan graduate 2 years ahead of our students in science and math. In addition, studies show that not only are we removed from the list of top nations in science and math achievement, but that we are at the bottom of the heap. My point is that we must concentrate on why the Goals 2000 bill was developed. It was deemed necessary to improve the standard of living of the Nation: To improve our standards and our competitiveness. While it is important for us to stay informed about recommendations for important subjects such as history, I am concerned that we will begin to forget why we are here, and that is to save the Nation. I will introduce a second-degree amendment at an appropriate time which will address the concern of my good friend, the Senator from Washington, regarding the development of certain standards at the UCLA Center for History in Schools, those standards remember that those standards have not been adopted by anyone, and they are not in a form to be adopted. In fact, the panel which would approve them has not even been named yet. So we are prematurely criticizing something which is not even ready to be adopted. But more importantly, the amendment requires that anything meritorious or relevant or acceptable that is in those standards should not be used. Now, I am not sure whether that means the acceptable elements could be proposed and later approved, or not. The amendment does not say. It simply states that the standards cannot be used and that no more money can go to them. Therefore my amendment will leave in the final paragraph of the amendment of the Senator from Washington, which states the concern about how we adopt the history standards, but will remove that part which states that we should simply throw away everything that has been done in this area and prohibits the information from being used. Out of a very substantial number of examples in the history standards, only a very few have provoked great controversy. Therefore, I will speak again later, when I offer my amendment. But I just want everyone to realize that the critical goal is to have an educational system second to none which will keep the United States competitive in the next century by providing the necessary skilled work force. I will also mention the cost of doing nothing and the cost of trying to do away with these standards. Right now, over $25 billion each year are spent by our businesses on remedial education because of the failures of our school system. In addition, we have about a half a trillion dollars loss in the economy due to illiteracy, imprisonment, and the many other social ills that result from educational shortfalls. This is an extremely important issue, and I hope that we will remain focused on the primary issue of developing a more competitive nation for the future. Mr. President, I must oppose the amendment offered by my colleague from Washington. The amendment, which has not been subject to any hearings or review by the committee of jurisdiction, prohibits the National Education Goals Panel and the National Education Standards and Improvement Council from certifying any voluntary national content standards in the subject of history. As my colleagues may recall, under the Bush administration grants were awarded to independent agencies, groups, and institutions of higher education to develop worldclass standards in all the major subject areas. The history standards were developed by the UCLA Center for History in Schools with the contribution of hundreds of individual teachers, scholars and historians. The standards, which have just recently been published, have raised concern among some readers. Criticism has focused not on the standards themselves but upon the examples of activities for students in each grade level. Of the thousands of examples, not more than 25 were considered controversial. However, upon receipt of public input and criticism the Center for History in Schools is reviewing and altering its work. This, in fact is, and should be, the appropriate process and primary purpose of public commentary. But, I am not here to defend the specific content of these standards--that is best left to teachers, educators, and parents. Instead, I am concerned that this amendment has much broader implications. At issue is not so much the specific substance of these standards. Indeed, the standards have neither been endorsed by any Federal body nor, for that matter, even been finalized. Rather, the issue is whether or not we have in place a process for developing world class standards. I cannot overstate the importance of this matter. Countless reports have outlined that our country is falling behind in international test comparisons because our children have not learned the necessary skills in order to compete successfully. A recent survey of Fortune 500 companies showed that 58 percent complained of the difficulty of finding employees with basic skills. The chief executive officer of Pacific Telesis reported: Only 4 out of every 10 candidates for entry-level jobs at Pacific Telesis are able to pass our entry exam, which are based on a seventh-grade level. It is no longer enough for Vermont to compare itself to the national average. Comparing one State with another is like the local football team believing itself to be a champion of national stature because it beat the cross town rival. No, we must compare ourselves with our real competitors--the other nations of this global marketplace. To date, it appears that they are quickly outpacing us in many pivotal areas. I have had meetings upon meetings with the chairmen and CEO's of major U.S. corporations to urge me to support the development of high academic standards. Why? Because the status quo in our schools has failed. Too many of our graduates finish school without knowing the three R's, much less more rigorous content standards. For our country to remain competitive, it is essential that our schools prepare our future work force for the demands of the 21st century. Unfortunately, until we present our students with challenging content standards that goal will not be realized. Instead, estimates indicate that American businesses may have to spend up to $25 billion each year just for remedial elementary math and reading instruction for workers before they can train them to handle modern equipment. Not only does this drain critical funds from our corporations but it dramatically affects our ability to compete in the global marketplace. For the past decade the average wage has gone down. The standard of living is slipping and wealth is accumulating only at the top. Until we are able to prepare our children for the future we will have failed ourselves, the next generation and this country. The first step to success is establishing strong academic standards so that our children leave school ready for the work force or for postsecondary education. Remedial education should not be the main function of our institutions of higher education or our businesses and corporations. By preparing our students while they are in school, we will reduce the need for catchup courses so many of our graduates now have to take. We have a process in place to get our children ready for the 21st century. That process includes reforming our school and creating high benchmarks for students. That process is done through the National Council on Education Standards and Improvement. NESIC will be a 19- member council composed of professional educators, representatives of business, industry, higher education, and members of the public. The council is authorized to certify voluntary national education standards and pass their recommendations to the goals panel for final approval. The role of the council is to certify that the standards developed in each subject area are credible, rigorous and have been developed through a broad-based process. NESIC provides a mechanism for ensuring that standards remain national rather than Federal. If this duty was not being performed by such a council, the responsibility for certifying national voluntary standards would fall squarely upon the shoulders of the Secretary of Education--which would positively result in greater Federal involvement. This body is a separate entity created to oversee the certification of voluntary national standards. It has absolutely no oversight authority over States. In other words, States are not required to agree with the voluntary national standards, they are not required to accept or incorporate any portion of the national standards or even acknowledge existence of standards. Yet such a national council is essential to States and local schools to assist them in weeding out and reviewing voluntary standards. Without such an entity, each State will have to undertake that review by itself. To do that 50 times over simply does not make sense. Clearly, the recommendations of the council are not binding on States. The council's certification process is simply a Good Housekeeping seal of approval to assist States in determining which standards are rigorous and competitive. For us to step in and derail this process makes no good sense. By passing NESIC's responsibility we not only jeopardize the whole independent nature of NESIC, we also jeopardize the process of creating tough academic standards. I don't think we have that luxury.

Mr. JEFFORDS. Mr. President, I would like to address the pending amendment.

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, I ask unanimous consent to proceed as in morning business.

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, it is my sad duty to inform my colleagues that this morning the president pro tempore of the Vermont Senate was killed in an automobile accident. He was a good friend of mine and will long be remembered. In my home State of Vermont, a calling to join the legal profession has historically been taken as a calling to public service. No family has taken that more seriously than the Bloomers of Rutland, VT. Asa Bloomer, legendary trial lawyer and rhetoritician, served his community well in the Vermont State Senate. In his heyday, in the 1950's and early 1960's, he was the acknowledged single source of power in the Vermont Senate. He rose to the rank of president pro tempore, a post he held at the time of his death, in 1963, suffering a heart attack in the legislative halls. He was a close friend of my father's, and brought me into close contact with the Bloomer family. Quite naturally, his older son Bob, a lawyer, followed his father to the senate where he served with distinction. Then his brother, a fellow lawyer and good friend, John Bloomer, ran for, and was elected to, the Vermont Senate; 2 years ago he was elected as was his father, as president pro tempore of the senate. He held that position until this morning, when enroute to the State House in Montipelier to preside at an important meeting of his judiciary committee, his life was tragically taken in an automobile accident. His dedication to his tasks in Montipelier was well measured by the fact that his failure to appear for the very start of the meeting was taken by his colleagues as a dire portent of bad news. John Bloomer was never late. A pall was immediately cast over the State House as the Vermont and American flags were lowered to half staff in the brilliant sunshine of a chill and crystal clear subzero Vermont morning. John Bloomer, Republican senator, was immediately remembered as John Bloomer, dear friend. Margaret Lucenti, a liberal Democrat who served well with John as clerk of his judiciary committee, said, ``He was just a wonderful human being, a friend to everyone.'' For me, a fellow member with John of the Rutland County Bar Association, he was a dear and trusted friend. I knew him for as long as I can remember. I will never, ever forget him. He was a true inspiration to all of us who knew him. John Bloomer was a man of strong convictions that were always tempered by compassion. As we remember his long years of service to Vermont, we will fondly recall his countless deeds of kindness to fellow Vermonters. My sympathies go out to his wife, Judy, to his brother, and to all his four children and to his countless friends, of which I am proud to count myself one. He well carried on the Bloomer family tradition of service to the State of Vermont. Our State will miss him, as a tireless public servant and as a caring and concerned human being. And I will miss him as a true friend. Mr. President, I yield the floor. Several Senators addressed the Chair.

Mr. JEFFORDS

Mr. JEFFORDS. Mr. President, the decision by the House Republican Conference to abolish legislative service organizations brings to an end the proud and productive history of the Arms Control and Foreign Policy Caucus. With regret that the caucus will not be able to play a role at this critical time of debate over the role of U.S. foreign policy in the post-cold-war world, the caucus will cost its doors in 1995. We are pursuing the possibility of establishing a new private entity to perform certain caucus roles, but at this time we plan to transfer caucus papers to the Legislative Archives Center of the National Archives. We also plan to transfer any unobligated caucus funds to the Treasury. For 30 years this bipartisan caucus--formerly named Members of Congress for Peace through Law--has played a constructive role on issues of war and peace in our time: in the 1960's it opposed the war in Vietnam; in the 1970's and 1980's it championed efforts for nuclear arms control; in the 1980's it built a powerful congressional coalition seeking negotiated solutions to the wars in El Salvador and Nicaragua; and in the 1990's it sought to focus on the post-cold war problems of weapons proliferation and the need for a strengthened United Nations. Throughout, it has also worked to promote human rights and improve the economic situation of peoples in the developing world. Its record in providing legislative services is also a proud one: during the 103d Congress alone, the caucus issued 150 legislative alerts and reports, over 30 special issue reports and fact sheets, and 3 in-depth comprehensive policy reports. It also hosted 10 meetings for Members or staff with outside experts. Claims by LSO opponents that LSO's are simply special interest groups with little legislative function are, certainly in this case, patently untrue. Finally, throughout its history, the Arms Control and Foreign Policy Caucus has upheld the strictest standards of financial accountability and has fully complied with LSO regulations and reporting. On behalf of the 125 caucus members, I express our hope that in some way, even without a support staff to coordinate our efforts, will be able to continue the distinguished tradition of acting in a bipartisan and bicameral manner to pursue the goal of a more peaceful world.