Frank Pallone

Mr. PALLONE

Mr. PALLONE. I want to thank the gentleman for his input into this. One of the things that the gentleman pointed out which I think is so important is the projections that we are working with now are basically assuming a good economy, or an economy that grows at the rate that we have now, and in fact if the economy slowed down, the problems that he pointed out and the Democrats have been pointing out in terms of the amount of money that is available in Social Security are aggravated considerably. I will just briefly mention again some of these statistics from the Congressional Budget Office. According to the Congressional Budget Office if the economy were to fall into a recession like the one in 1990 and 1991, the budget would be in deficit within one year. My colleagues on the Committee on Ways and Means, and we are going to have the gentleman from Washington (Mr. McDermott) next talk to us, but on the Committee on Ways and Means they pointed out that if the recession began in 1999, the $79 billion budget surplus projected for the year 2000 would turn into a $38 billion deficit and the $86 billion surplus in 2001 would become a deficit of $53 billion. So the assault on Social Security that the Republicans are proposing this year would widen these deficits by as much as $18 billion a year. Of course we hope the economy is going to continue to be good and we are going to do whatever we can to make sure that it is, but the problems that the gentleman from Maryland pointed out become aggravated if we do not continue to have an economy that is this good, and frankly the economy has not been this good for most of the last 10 or 20 years. So it is another reason why we have got to be very careful about what we do. I yield to the gentleman who is on the Committee on Ways and Means and has been very knowledgeable and thoughtful about this whole proposal.

Mr. PALLONE. Mr. Speaker, tonight I have a number of my colleagues, Democratic colleagues, who would join me this evening to talk about the issue of Social Security in the context of the tax proposals that the Republicans plan to bring to the House floor tomorrow as well as Saturday of this week. Mr. Speaker, the Republicans, in my opinion, are moving full steam ahead with this plan to raid the budget surplus to pay for tax cuts instead of putting that money where it rightly belongs, and that is into Social Security. Make no mistake about it, Mr. Speaker, the Republican tax bill is a direct assault on Social Security. The budget surplus that the Republicans want to use to pay for their tax cuts that they are going to be putting before this House tomorrow or Saturday do not exist. There is no budget surplus. The only portion of the Federal budget that is in surplus is the Social Security Trust Fund. In fact, without Social Security, the Federal budget would still be in a deficit this year. According to the Congressional Budget Office, Social Security will take in a $101 billion surplus this year. But CBO also projects the total surplus for the Federal budget this year to be $8 billion. If we do the math, Mr. Speaker, we find that without the surplus in the Social Security Trust Fund, the total Federal budget would have a $93 billion deficit in 1998. The story is the same if we project the numbers out even further. The CBO projects that without the Social Security surplus, the Federal Government would run a $137 billion deficit over the next five years. Over the next 10 years, CBO projects a $1.6 trillion deficit for both the Social Security trust fund and the total Federal budget. In other words, every single penny of surplus the Federal Government is expected to take in over the next 10 years will come from the Social Security trust fund. Because the Federal Government borrows from the Social Security trust fund to pay for other government programs, by the year 2008 the general fund of the Treasury will owe Social Security $2.52 trillion. I do not want to just keep going into these numbers, I would like to yield some time to some of my colleagues this evening, but I want to say that when I talk to my constituents back in the district, regardless of these numbers, they understand the reality. They understand, particularly the senior citizens amongst my constituents, that we have been borrowing from the Social Security trust fund now for a number of years and that that money has to be paid back at some time in the future. So it is very deceptive, I would say, on the part of the Republican leadership to propose a tax cut bill knowing full well that this has to come from the Social Security trust. I would like to yield some time to some of my colleagues this evening to talk about this. Democrats as a party have joined with President Clinton in pointing out from day one this year, the President actually mentioned it in his State of the Union address back last January, that it is imperative that we do what we can this year, if not now in future Congresses, to correct the problems that we will face with Social Security 10, 20, 30 years from now, because there will not be enough money in the trust fund to pay for that generation of baby boomers that will become 65, that will be senior citizens at the time. And so all we are really saying as Democrats is the time is now to think about what we are doing here. We just got into a situation where we have some extra money being generated from general revenues because the economy is good and we passed this Balanced Budget Act last year, let us not now before we have time to think about it just go hog wild, in effect, and start spending money on a tax cut which essentially is just coming from the Social Security trust fund. I yield to my colleague the gentleman from Maryland who has been making this point many times to me over the last few weeks.

Mr. PALLONE

Mr. PALLONE. Mr. Chairman, I move to strike the requisite number of words. Mr. Chairman, I want to first apologize to the gentleman from Louisiana (Mr. Livingston) for not allowing him to speak beyond the 5 minutes, and I am glad to see that we are talking extra time at this point, because I think everyone should be allowed to speak for as long as they want this evening. I do want to say, though, that the notion that somehow the United States and the State Department have been taking a neutral position and that somehow the existence of 907 tilts us towards Azerbaijan or tilts us toward Armenia is simply not true. The United States is not neutral between these two countries. The U.S. has clearly taken a pro-Azeri position from the very beginning, and this administration and the State Department continue to take a pro-Azeri position. I say that because they tried to impose a settlement in Armenia with regard to Nagorno Karabagh that was not acceptable. They did not and they continue not to recognize the territorial integrity of Nagorno Karabagh, which existed as an entity even during the Soviet era. And the United States clearly and the State Department clearly have not taken the position that is supportive of Armenia. I am very afraid that by repealing section 907, we would be sending a clear signal to Azerbaijan that we are 100 percent supportive of their position and, as a result, they would have absolutely no incentive to try to resolve the conflict in the Caucasus, to try to resolve the conflict in Nagorno Karabagh and make peace ultimately with Armenia. Let me just address a few other things that were mentioned here tonight. I know a few of the speakers said we should not look at human rights abuses because they have existed on both sides. If we take that position, we are denying the historical fact of the Armenia genocide, and that is why so many people on our side of the aisle who are pro- Armenia feel so strongly about what is going on there. Nagorno Karabagh was attacked by Azerbaijan. They suffered an aggressive attack by the Azeris and by Azerbaijan as a nation, and they had to defend themselves. The aggressor here was Azerbaijan. The aggressor historically in that area has been either the Azeris or the Turks, and to suggest that somehow this blockade which prevents humanitarian assistance from going to Armenia is not in some ways a continuation of that historic genocide is a denial of history. That is why we cannot allow this section 907 to be repealed, because otherwise the people of Armenia will continue to suffer and will not receive humanitarian assistance. Let me talk about the energy issue. I understand that some people feel that we should not discuss the energy issue here, but others have brought it up and talked about our energy dependence. The bottom line is that if we repeal section 907, we create no incentive for Azerbaijan to share its oil resources in the Caucasus region and to work with Armenia, which suffers an energy crisis. And right now, there is absolutely nothing that would prevent Azerbaijan from building a pipeline through Nagorno Karabagh, through Armenia and down to the Mediterranean. That is the direct way to do it, that is the easiest way for that pipeline to be built. Armenia has said historically that they would like to share energy resources and work with Azerbaijan in terms of a free flow of oil to the West. If we repeal section 970, we create no incentive for using that oil in a cooperative way within the Caucasus countries. That is the kind of signal that we are going to send. And lastly, let me talk about the peace process, because some of my colleagues on the other side have said that somehow repealing 907 will lead to peace. That is not the truth. What they are doing here is rewarding the aggressor. They are telling the country that attacked the Armenians in Nagorno Karabagh, they are telling the country that continues to blockade, that they are going to be rewarded by repealing section 970. We know historically that appeasing the aggressor does not work. It did not work in the case of Chamberlin. And what did we get? We ended up killing 6 million Jews in the Holocaust in Nazi Germany because we appeased the other side. We appeased Adolf Hitler. Start that policy of appeasement again, and we will see another genocide in the Caucasus, we will see a continual genocide of the Armenian people. I do not think that it is fair for people to ignore the historical reality of what is going on here, and if we want to achieve a policy where these three Caucasus nations work together, then do not reward the aggressor. Do not reward the country that is continuing the blockade. Let these countries work together. Let the United States show that it can be neutral and work equally with the other countries. There is nothing to stop the United States from telling Azerbaijan that they should share their resources, their energy resources and work with Armenia and the other Caucasus nations. The U.S. is powerful enough to basically give the signal to Azerbaijan that if they do not lift this blockade, that we will not continue to support them, and that is what we should be sending, that signal to Azerbaijan.

Mr. PALLONE. Mr. Chairman, again, I would like to rise in support of an amendment that is being offered, hopefully soon by my colleague, the gentleman from California (Mr. Radonovich) of California, cosponsored by myself, and it is very simple and straightforward. It would simply strike the section relating to the repeal of Section 907 of the Freedom Support Act. The Freedom Support Act, passed by Congress on a bipartisan basis and signed into law by President Bush, defined U.S. policy in the Newly Independent Countries of the former Soviet Union in the post-Cold War era. Section 907 prohibits direct U.S. Government aid to Azerbaijan until that country lifts its blockades of Armenia and Nagorna Karabagh. Mr. Chairman, Section 907 was good law when we passed it back in 1992, and it is still good law. Azerbaijan has done nothing to comply with the basic requirement of Section 907 that it lift its blockades of Armenia and Nagorna Karabagh, blockades that have caused severe human hardship for the Armenian people. Mr. Chairman, Azerbaijan is an authoritarian regime run by a Soviet Arab bureaucrat named Heydar Aliyev. Armenia, on the other hand, is a democracy that has tried to extend the institutions of democracy to its citizens while making the transition to a market economy. Yet, Mr. Chairman, if we adopt the language in the foreign ops bill, we will essentially be rewarding the country that has not made the transition from Soviet era despotism and corruption and punishing the country, that is Armenia, that has moved towards democracy and a market economy and is trying to integrate with the West. I would just like to say again, let there be no doubt that the government of Azerbaijan has blockaded Armenia for 9 years. The blockade has cut off the transport of food, fuel, medicine, and other vital supplies creating a humanitarian crisis requiring the U.S. to send assistance to Armenia.

Mr. PALLONE. Mr. Chairman, I object.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I rise in opposition to the rule and in opposition to the underlying bill, particularly the provision that would repeal section 907 of the Freedom Support Act. An amendment will be offered today which I have cosponsored that would strike this repeal provision. Mr. Speaker, Azerbaijan has done nothing to comply with the basic requirement of section 907 that it lift its blockade of Armenia and Nagorno Karabagh, blockades that have caused severe hardship for the Armenian people. The Government of Azerbaijan has blockaded Armenia and Nagorno Karabagh for 9 years. The blockade has cut off the transportation of food, fuel, medicine and other vital supplies, creating a humanitarian crisis requiring the United States to send emergency life-saving assistance to Armenia. Next, Mr. Speaker, I would like to speak in opposition to an amendment expected to be offered by the gentleman from Indiana (Mr. Burton). This amendment cuts humanitarian foreign assistance to India. As a result of the underground nuclear tests that India conducted in May, the President was required to invoke severe sanctions pursuant to the Glenn amendment of the Arms Export Control Act. These sanctions terminated much of the development aid that the U.S. provides to India; however, it protects humanitarian programs from the sanctions. Passage of the Burton amendment would only serve to hurt India's poor and not have any impact on the government. The United States and India have conducted several rounds of bilateral talks that have been labeled as ``positive'' and ``successful quiet diplomacy.'' This positive direction would be substantially disrupted by passage of the Burton amendment. In light of the progress in the ongoing U.S.-India talks, now would be the worst time to enact the Burton amendment. Again, Mr. Speaker, this rule should be opposed and the underlying bill should be opposed, in part because so much effort is put into legislation, if you will, on appropriation bills. I share the opinion that was expressed yesterday by the gentleman from New York (Mr. Gilman), when he addressed the Committee on Rules and said that to the extent that this legislation actually includes authorizing language that has not been reviewed by the full Congress, it should be defeated.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, at the direction of the Democratic Caucus, I offer a privileged resolution (H. Res. 540) and ask for its immediate consideration.

Mr. PALLONE

Mr. PALLONE. I honestly believe, and I will say this now, that I think that the opportunity does exist over the next few days to get a number of our Republican colleagues to join us on this and to defeat this effort to try to spend the alleged surplus. But of course I have to say that it is true that the idea is coming from the Republican leadership, and that is why so many of us on the Democratic side are speaking out against it.

Mr. PALLONE. No, I appreciate the gentleman. If I could just reclaim my time briefly? I wanted to make it clear, emphatically clear, that this proposal that is before the Committee on Ways and Means is essentially coming from the Republican leadership, and I know that there are many Republicans, and I heard you speak this morning on this subject, that share the viewpoint that we have been expressing here that we should not have this tax cut until the Social Security money is paid back and until and that the really is not a surplus. So I appreciate your comments. I yield to the gentleman from Wisconsin (Mr. Kind).

Mr. PALLONE. I yield to the gentleman from Wisconsin.

Mr. PALLONE. Because I think that if we do not get our point across now that this is a problem and this passes, then what is to stop it, you know, if the lesson is not learned?

Mr. PALLONE. I would like to just develop a little of what you just said. That is, the way that we pay for Social Security, which is really not a progressive tax. I mean, it is basically a tax that wage earners pay at a certain rate. If you have to rely on that as a means of raising this revenue, we know that a few years ago, I think it was in the 1970s that the FICA, which is the tax that you pay on your earnings that pays for Social Security, was actually increased in order to generate more money that would be needed because it was estimated that we need more money for future beneficiaries. If we five or 10 years from now have to raise that FICA tax again in order to correct the problem that this money has not been paid back, not only would we be raising taxes again in order to have enough money for Social Security, but again it is not a progressive way of financing the program, as you say, paid for really on the backs of working people, strictly working people. That is not really a fair way to go about it. I think it is also true that we are hearing all these proposals now about not having the Social Security COLA, raising the age before you get benefits. The effort to try to do those kinds of things will be increased. The pressure will be increased because the money will not be there. We have not figured out a way to pay this money back. This possible surplus that is being generated now is really the only thing that is on the table that has a real possibility of paying some of this money back that has been borrowed. All the other alternatives that I can think of are not very desirable. So I appreciate your bringing that up as well. I think that we probably talked enough about this tonight, but I know we are going to be talking about it a lot more over the next few days, and I am just hopeful that we can get not only most, if not all, the Democrats to support this idea of Social Security first and not implementing this tax cut until the Social Security Trust Fund has been paid back, but maybe get some Republicans as well.

Mr. PALLONE. Let me say to the gentleman that what he said about Wisconsin is certainly true in New Jersey. I had over 20 town meetings, forums during the August break. Particularly senior citizens are very much aware of the fact that we do not have a surplus because we are borrowing from Social Security and feel the same way, along the same lines that you have articulated. The other thing I wanted to say and I think is very important that you raised which really has not come up from what I have heard from the Committee on Ways and Means, certainly not from the Republicans who are pushing for this tax cut, is that we not only have to worry about the Social Security money that has to be paid back but we also have this huge national debt that was accumulated over the years. A lot of people are not aware of the fact that it is only in this one year that we are balancing the budget. We still have to pay back this debt with interest for all those years. So even for those who feel that we should not spend this surplus on a tax cut because of what is owed to Social Security, there might be just as many hopefully that think that we should not be spending it because we have to pay back the national debt. Both of those are very legitimate reasons that you have pointed out.

Mr. PALLONE. Let me first thank the gentleman from Texas for the comments that he made. I would like to yield to the gentleman from Wisconsin, but let me, if I can, comment briefly on what the gentleman from Texas said, because I think it is so important. The gentleman stressed how we were so successful and it took so long to get to the Balanced Budget Act, which was passed last year, and I think it is, in part, because of that and because we are not creating more deficits that our economy continues to be strong. Because I believe very strongly, I do not know what economists I can cite for it, but I am sure there is a lot of commentary to suggest that as we continued to build these deficits in the last 10 or 20 years, it had a negative impact on the economy. I think that a good part of the reason why the economy is doing well is because the Balanced Budget Act was passed and we are not creating more deficits. But we have to go further with this because the bottom line is that we still have this money that is owed to the Social Security Trust Fund. And when that has to be paid back, and it has to be paid back with interest, the money has to come from somewhere, and I am concerned. And the gentleman talked about a good economy. We have to deal with this problem about how to pay back this money over the long term, which really has not been addressed yet. In fact, if the economy gets worse, future generations may have to pass a tax increase to make sure they are paying the money back to the Social Security Trust Fund for the benefits to be there in 10, 20, 30 years when the need arises. What are the consequences if we do not have the money to pay back? And there may not be the will to pass a tax increase to pay for that in a few years. Then what happens to the benefits? They may not be there. They may cut back on the benefits as an alternative. So this is really crucial in terms of where this Social Security program goes. We need to put that surplus in there to make sure that we are paying back this borrowed money, otherwise it may not be there for future generations. I think the gentleman made the point well when he said that this is the time to think about it, when the economy is good, and not to just go head over hog in dealing with some tax relief program that puts us further into debt and does not solve the Social Security problem. So I just wanted to thank the gentleman again for that input. I would like to yield now to the gentleman from Wisconsin (Mr. Kind).

Mr. PALLONE. Mr. Speaker, tonight I want to discuss the need to strengthen Social Security for the long term. I just wanted to say that I think a lot of people are not aware of how successful the Social Security program has been. Of course it was created by Franklin Roosevelt quite a long time ago in the wake of the Great Depression, but it has been our most successful domestic program in the Nation's history. Just to give some examples, Social Security has kept millions of retired seniors from living in poverty by providing a guaranteed cash benefit with a lifetime protection against inflation. For about two- thirds of beneficiaries, Social Security provides about half of their annual income; and, for 30 percent of beneficiaries, Social Security provides 90 percent of their annual income. Social Security is the only source of income for one in every six older Americans. And in large part, Social Security relieves today's workers of the economic burden of supporting their aging parents. In addition, the comprehensive benefits provided by Social Security saves millions of families from financial disaster in the event a worker's death or disability. Finally, 39 percent of all Social Security benefits are paid to workers who become disabled, survivors of deceased workers, and spouses and children of retired and disabled workers. So this, again, is our most successful program in the Nation's history. That is why I think that it is so important that all Americans be aware of what the Republican leadership wants to do with the projected Federal surplus. They are supposed to vote on this in the House Committee on Ways and Means as early as tomorrow. I think that young people and seniors alike should be concerned with the Republicans' intention to use budget surpluses for tax cuts, instead of saving that money until we have developed a way to protect Social Security for the long term. What we are hearing from the Republican Leaders that is going to be voted on in committee tomorrow is a tax cut plan that would cost $80 billion. That sum is so large that it could not be financed without dipping into the budget surplus, which incidentally we do not even have. We have not seen it yet. We talk about, and the media talks about a budget surplus, but we do not really know exactly what it consists of or whether it is real. The CBO, the Congressional Budget Office, in fact estimates that were it not for a surplus in the Social Security trust fund, the total Federal budget for this year would indeed be in a deficit. So what we really know is that without the application of the trust fund, the money from the Social Security trust fund, in fact, there would be no surplus at all. That is why we need to guard against what the Republicans are proposing to do tomorrow. I will explain it a little more, and I have the gentleman from Texas (Mr. Green), who is going to join me as well. Mr. Speaker, as many people are aware, and I hear this a lot at town hall meetings and the senior forums that I have in my own district, particularly during the August recess, the Federal Government uses the surplus in the Social Security trust fund to fund other government programs. In effect, the government borrows from Social Security. So if there is excess money or surplus in the Social Security trust fund, it is essentially lent to the Federal Government and the Federal Government uses it for other purposes. Now, it seems only logical then that when the Federal budget realizes a true surplus, in other words when the general revenues are in surplus, that that surplus be used to pay back what has been borrowed from Social Security. That is what Democrats have been saying ever since we realized that the Federal Government may have a surplus sooner that was expected. Let me say again in a few more words that when we passed the Balanced Budget Act last year, we did not anticipate that there was going to be a surplus for some time. But because the economy has been good this year on an annual basis, we understand that there may in fact be a surplus. But that is only in general revenues. That has nothing to do with the Social Security money that people pay, wage earners pay in their taxes on a regular basis when they earn a certain income. So even though there may be a slight surplus in general revenues at the end of this year, we have borrowed so much money from the Social Security trust in the past, and we will continue to do so this year, that that little surplus in general revenue does not make up for the money that we have borrowed from the Social Security trust fund. So what we are saying is that if we add that money borrowed from Social Security, in effect we have no surplus since we have to pay that money back. Whatever money is generated annually through general revenues should be applied ultimately to pay back what is owed to Social Security. Back in January, the President said in his State of the Union address that he believed that Congress should not touch whatever surplus and revenues are generated this year until lawmakers come up with a plan to shore up Social Security for the long-term. We know that 20 years from now, there is not going to be enough money in the Social Security trust to pay the beneficiaries at that time because a lot more younger people, the baby boom generation, will be retiring at that point and we will need more money in the Social Security trust fund. In addition to that money, that has to be paid back. The President believes, as I do, that protecting Social Security should be a bipartisan goal and he recently made a radio address stating that Republicans and Democrats alike must maintain fiscal discipline, setting aside the surplus until we save Social Security. Let us talk a little bit about this bill. A number of my colleagues and I, going back to February after the President's State of the Union address, a number of our Democratic colleagues back then in February introduced H.R. 3027. This establishes a fund called the ``Save Social Security First'' reserve fund to hold all Federal budget surpluses. It literally says the funds shall be used to save budget surpluses pending Social Security reform. This is a very simple bill that was introduced by a lot of the Ways and Means members back in February. And if the Republican leadership would just bring this bill up on the floor tomorrow, which they could do, then we could easily pass it, it could be signed into law, and we would know for sure that any action that was taken in terms of taxes or spending would, in effect, require first that the surplus go into Social Security. Obviously, the Republicans are not bringing up that bill and, instead, what we are hearing is that they are going to bring up this tax cut that is going to cost the surplus $80 billion. And that, of course, will really have an impact on the Social Security Trust Fund because it will mean that we have $80 billion less that we can apply towards Social Security. I would like at this time, there is a lot more that I could say on this, but I will at this time yield to my colleague, the gentleman from Texas (Mr. Green), who has expressed concern about this issue before on the floor, and who is here with me tonight, so we can try to get a little more light on this subject to the American people and our colleagues.

Mr. PALLONE. I appreciate the gentleman's comments, and if I could say, and out of no disrespect, that we are going to yield back the balance of our time and you can start your hour so we can go home.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, let me just point out that the problems that the gentleman from Michigan (Mr. Dingell) pointed out, I think, were misrepresented by the Republicans on the other side. Basically, what the gentleman from Michigan (Mr. Dingell) was saying, and I agree, is that there is not very much in this bill that is not already the law, and that it is being brought up at this time to try to give the impression during an election year that somehow the Republican majority is doing something significant with regard to this issue with regard to drug addiction. Secondly, he pointed out that we do have included in this bill a special interest provision which thankfully he caught and now the Republican side is saying that they are going to take out in a subsequent amendment. Let me say the problem with that is the mischief that we see when a bill like this does not go before the committee, does not see the light of day, does not have the opportunity for public debate and for input from the public. That is when we get these kinds of special interest provisions that thankfully were caught. What else might be in this bill because it did not go through the regular process? That is the point that he made. Let me just reiterate again the problem with this special interest provision if it is not taken out and if somehow this body does not approve to take it out, basically what it allows is an extension of this exclusivity for 6 months and what that means is that those who might want to produce these antiaddiction drugs in a generic sense, as a generic drug, would not have the opportunity to do so because of the extension of the exclusivity. What that means is that these drugs become more expensive, and the big issue before this House with regard to health care in general and certainly with regard to drugs is their affordability. People cannot afford a lot of drugs. They do not have access to them if they cannot afford it. One of the points we are making is if there was that extension of exclusivity it would not allow generics and others to come in and produce a drug in a way that is less expensive and more available to the public. So this was a special interest provision that was put in there that was anti- consumer, anti-public interest, and I am glad that it is now being taken out. What other mischief is in there that we have not had an opportunity to look at because of the fact that this did not go through the committee of jurisdiction and did not have an opportunity for hearing? That is the problem. We are not against the bill per se but we are against the way that the Republicans went about this.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I want to follow up on what the previous speaker said, not only my Republican colleague from Wisconsin, but also my Democratic colleague from Oregon. Seniors understand, when we talk to them and when we have town meetings, that there is essentially no surplus; that the so-called surplus that we talk about is essentially what is owed to Social Security, and that we have to pay back a lot of money to the Social Security trust fund over the next 5 or 10 years if we are to have enough benefits to pay out to Social Security recipients. That is why this Republican tax proposal is really the wrong way to go. What will happen, essentially, is that we will, in fact, increase the debt and, ultimately, may have to raise taxes in order to provide the benefits that Social Security recipients need. So what I say is we spent a lot of time last year on a bipartisan basis to pass a Balanced Budget Act. We have a balanced budget, but we still have this problem that we have to pay back Social Security. We do not have a surplus. We do not have one to spend. Let us not, in the few weeks we have here in this Congress, waste our time trying to kid the American people that somehow we are going to give them tax relief. It is not really there to spend.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I wanted to take my 5 minutes this morning to stress again, as I have several times on the floor over the last week or so since we came back from our August recess, how important it is for us to move forward on a positive agenda that addresses some of the major concerns that the American people want us to deal with before this Congress adjourns in approximately four weeks. I have to say the Democrats are united behind a strong and bold agenda which addresses the real challenges that face working families. Democrats have been working together over the last year and will be over the next few weeks to enact our priorities and deliver a clear message to the American people about what we stand for. There are two main areas which I think need to be prioritized. One is the idea of saving Social Security first, and the other is a Patients' Bill of Rights, or HMO reform. I am very concerned about what may happen this week with regard to a tax bill that is proposed to come out of the Committee on Ways and Means this Thursday and that will spend a significant portion of the so-called surplus that we allegedly have, but will not address the concerns over Social Security. In fact, in today's Congress Daily, some of the Republican members of the Committee on Ways and Means who were concerned about addressing the Social Security issue actually were told that they will have to wait until next year to deal with that; we will do the tax bill first and worry about Social Security later. Well, that is the wrong priority. We should be dedicating every penny, every penny of that surplus, towards shoring up the Social Security system, rather than providing short-term tax cuts that will primarily help the wealthiest Americans. President Clinton said at the beginning of this year, and he has repeatedly said over and over again, that Democrats want to make sure that whatever surplus there is over the next few years is used to basically make the Social Security system sound, because we know that in another 20 or 30 years there will not be enough money in Social Security to pay for current levels of benefits. What we also need to point out is that most of the Social Security trust that is in surplus right now has been lent, if you will, to the Federal Government, and has to be paid back with interest. Well, right now if you look at that trust money that has been lent to the government and essentially been used, we do not really have a surplus in our general revenue funds, because we have to pay back that Social Security money that was lent to the government. So I will insist, I will insist, and I think that most of my colleagues in the Democratic Party will insist, that before any tax cut is given back and any money is spent of this so-called surplus, that we make sure there is enough money left to pay for Social Security. That is not the case right now. There is not enough money in the so- called ``surplus'' to pay back what is owed to the Social Security system, and we should not be passing any tax cut bill or giving out or even spending money on new programs or priorities until we make sure that that money is available for the Social Security recipients. The Republicans are going to try to mask that this week and pretend as if there is a surplus out there. There is no surplus when you think about the money that has to be paid back to Social Security. Let us not pass a tax bill unless we have a guarantee in that tax bill that the money will be set aside for Social Security before any more money is spent or paid out in tax cuts this year. The second issue that I would like to raise, and I think we need to address before Congress adjourns in the next four weeks, is HMO reform. The Democrats have put forth a Patients' Bill of Rights. The President, again, in his State of the Union address earlier this year, emphasized that we need to pass HMO reform during this Congress. The Democrats have put forth a very good bill called the Patients' Bill of Rights that is real HMO or managed care reform. We need to pass this legislation before we adjourn. Again, the key elements of this bill, I would just like to list some of the key elements of the Patients' Bill of Rights: Guaranteed access to needed health care specialists, access to emergency room services, continuity of care protections, access to timely internal and external appeal process, limits on financial incentives to doctors, assuring doctors and patients can openly discuss treatment options, and an enforcement mechanism that ensures recourse for patients who are maimed or die because of health plan actions. The main thing we want to do with this Patients' Bill of Rights is we want the decision of what kind of care you will get, whether you will get an operation, whether you will be able to say, stay in the hospital a few extra days, have that decision be made by the physician and his patient, in consultation with the patient, and not by the insurance company. Too many people have been denied care under their HMO policies or their managed care policies, and that should not be the way it is in this country. We have quality health insurance, but people have to be able to assure, if they need a particular operation, if they need a particular procedure, that they can have it. That is what Democrats stand for, and that is what we will be fighting for over the next four weeks.

Mr. PALLONE

Mr. PALLONE. I think you are right, and I think that we are going to hear more about this over the next few days, but I am glad that we are able to spend some time tonight on it because this is going to be a major part of the debate over the next few days and the next few weeks here. So thanks again.

Mr. PALLONE. Well, I think you are pointing out another point as well tonight, and I appreciate your bringing it up, and that is that to some extent, I think to a large extent, this is just being done by the Republicans for political purposes because the election is a few weeks away. Because I think we have already heard pretty much from the other body, from the Senate, that they are not going to take this up. And so this is not a proposal that is likely to go anywhere, it is just going to be passed in the House so that Republicans can go back and say, oh, they did this and somehow benefit from it on election day.

Mr. PALLONE. Sure. And then the last thing I wanted to say, and I think is sort of the true irony, is that the Republicans, of course, during this balanced budget debate over the last few years posed themselves as the conservatives. And the bottom line is that the two of us and others that have taken the position we are talking tonight are the true conservatives from a fiscal point of view. In reality what the Republican tax proposal is essentially, you know, I do not want to use the term ``liberal,'' but it is just basically fiscally irresponsible. And if you are really concerned about fiscal responsibility and you really are conservative, you take the point of view that you are taking tonight. I think that is ironic, but I have to say it because it is true.

Mr. PALLONE. The second point that you made that I wanted to just develop a little as you talk, and this comes out of my town meetings all the time. As you know, our constituents are pretty intelligent, they understand a lot of these things, and one of the things that constantly came up during the August break at my town meetings was the fact that people are aware that we have this huge debt out there that keeps collecting interest. You brushed upon that. I mean we have been mainly talking about why this Republican tax proposal is wrong because of Social Security, but you could also look at it from the other point of view, which is that we still have this huge debt that we are paying back. When we are told by whatever that there is a surplus this year, that is only a surplus for general revenues for this fiscal year. There is still all this money that we owe from previous years that has to be paid back. So you could use that argument as well to justify why there should not be a tax, why this tax proposal should not go forward.

Mr. PALLONE. So the likely result is then of course, the other thing that I was going to say is that, and again following up on your point, is that the economy is good now. It is the best it has been for a while. If it were to turn around and not be so good, it would be even more difficult, it seems to me, to raise the revenue. You would have to have either higher tax increases to make up for this loss. So to me it makes no sense now when the economy is good and we are actually in a position to be generating a little bit of extra money. This is the time to put it back.

Mr. PALLONE. I just wanted to, if I could, take a few minutes to develop three points that I thought that the gentleman made that were really excellent. I want to commend him first for what he said because I think he states very succinctly what the problem is that we face with this Republican bill that we are going to have, this tax cut or tax proposal that is going to come up on Thursday. There were three things that I wanted to follow up on. One is it is, of course, true, I would think, and I ask you this, that if we have this tax cut and it were to pass and it was not linked to some requirement that it would not be triggered until there is a true surplus, the whole point of this money having been borrowed from the Social Security trust, if you will, to pay for current expenses means that we have to pay it back. In other words, the way the Federal law was set up with Social Security, we have to pay it back with interest. So the reality is that if that money is not there, when it has to be paid out in a few years, we would probably have to do a tax increase.