Paul Sarbanes

Mr. SARBANES

Mr. SARBANES. If the Senator would yield for one further question, just to take your analysis a step further, in 1992 and 1988, in each of those years, you had a Republican President and a Democratic Senate, is that not correct?

Mr. SARBANES. I yield for the inquiry.

Mr. SARBANES. Let me take the Senator's----

Mr. SARBANES. I thank the Chair. I would like to ask the distinguished Senator from Vermont a couple of questions, if I can, about the charts he was referring to earlier. I want to make sure I understand them fully. This one, as I understand, shows the number of judges that have been confirmed in the last three Congresses--we are now in the 105th Congress. There are currently 94 vacancies in the Federal court system?

Mr. SARBANES. It is not even moving with the speed of a glacier, one might observe.

Mr. SARBANES. This is the first judge that has come before us?

Mr. SARBANES. As yet, no judges have been confirmed in this Congress?

Mr. SARBANES. Although I gather there are some 25 judges pending in the Judiciary Committee.

Mr. SARBANES

Mr. SARBANES. This is a chart that Senator Leahy, now the ranking member on the Judiciary Committee, used today in the course of the Merrick Garland debate which I think is enormously instructive. It is the number of judges confirmed during second Senate sessions in Presidential election years.

Mr. SARBANES

Mr. SARBANES. Mr. President, I rise today in recognition of National Agriculture Week and to pay tribute to the farmers of this nation whose dedication and diligence throughout our history have not only served to feed our families, but have also provided a strong framework for the economic prosperity of this country. At the 1896 Democratic National Convention, it was William Jennings Bryan who recognized the importance of farmers, not only as the individuals who provide our sustenance, but as integral parts of the American business community. He said, ``The farmer who goes forth in the morning and toils all day, who begins in spring and toils all summer, and who by the application of brain and muscle to the natural resources of the country creates wealth, is as much a business man as the man who goes upon the Board of Trade and bets upon the price of grain.'' Today, when technology like weather trackers and cellular phones plays as important a role on the fields as it does on Wall Street, Bryan's words ring true. Bryan's other comment about farmers reminds us of a fact too often forgotten: ``The great cities,'' he said, ``rest upon our broad and fertile prairies.'' Indeed, the productivity of America's farmers not only keeps Americans fed, it also enables the rest of our citizens to embark upon their daily tasks and diverse careers without concern that the grocery's shelves will be empty. Our farmers are so productive that they sustain the lives of more than 250 million Americans every day and still have enough left over to make agriculture our nation's leading export. In 1930, 1 American farmer produced enough food to feed 24 people. Today, that same 1 farmer is feeding 129 people. In fact, our farmers are so efficient that Americans spend approximately 9 percent of their income on food, compared with much higher figures in other countries, such as 17 percent in Japan and 27 percent in South Africa. Yet the agricultural industry's contributions to our economy often go unrecognized. I grew up on the Eastern Shore of Maryland, where my parents owned and operated a local restaurant. I spent much of my childhood working in that restaurant, and one of my clearest memories is of Saturday evenings, when the farmers would come to town to stock up on supplies after a hard week's work. Every Saturday, my parents would keep the restaurant open late, waiting for the farmers to arrive. Over the years, I gained a good understanding of the successes and hardships related to agriculture. In my house, we knew that if the farmers were successful, our own business would prosper. Since then, and the beginning of my career in public service, my contact with farmers from across the State of Maryland has confirmed my strong view that we cannot have real prosperity in this country if the farm sector itself is not sharing in and laying the foundation for that prosperity. Farmers bear a weighty burden. At the same time that their work feeds millions and includes efforts to cleanse a polluted environment, that work is also part of a very modern industry, which generates billions of dollars in revenue and employs more than 15 percent of our citizens. Yet unlike many other billion-dollar businesses, almost 90 percent of American farms are owned by individuals or families. Family farmers are the backbone of America's agricultural industry and we must ensure that they remain a vital part of American society. All of this is relevant, I believe, to this year's National Agriculture Week theme, ``Growing Better Every Day--Together.'' Indeed, we all must remain committed to working on behalf of our farmers at all levels of government. Only through such cooperation can we look forward to a future in agriculture which is even more successful than our present. In the State of Maryland, our attempts at such cooperation are indeed paying off. Recently, I have worked closely with State and local officials to support the efforts of farmers seeking to increase production by bolstering their existing export capabilities and identifying ways in which additional Maryland agribusinesses can enter foreign markets. Maryland is the eastern seaboard's fastest growing exporter. And with a strong and growing trade infrastructure--which includes the port of Baltimore, the World Trade Center, Baltimore- Washington International Airport and other aggressive export-enhancing initiatives--we are hopeful that agriculture, as Maryland's number-one industry, will be able to further tap into the State's increasing number of international opportunities. New forums across Maryland-- which we have initiated together with the Maryland Department of Agriculture and our terrific Maryland Secretary of Agriculture Lewis Riley--are helping farmers take full advantage of our expanding capabilities and possibilities in this regard. We in Maryland take much pleasure in the achievements of our farmers. Generating more than $1.6 billion a year, agriculture employs about 14 percent, or 350,000 of Maryland's workers. Maryland's agricultural industry truly helps the State live up to its often used nickname, ``America in miniature.'' From vegetable production and horticulture in southern Maryland, to the dairy operations and horse farms of central Maryland, to the beef cattle, forestry products and tree fruit in western Maryland, to poultry growing on the eastern shore, Maryland agriculture is indeed diverse and provides a showcase for the nation's agricultural capabilities. Mr. President, we in Maryland and our nation are very proud of our agricultural industry. There is still much work to be done to ensure a bright future for America's farmers, but as this week's theme suggests, through a strong commitment at all levels of government--together--we can help continue to build such a future.

Mr. SARBANES

Mr. SARBANES. Mr. President, as a nation we have a deep commitment to a decent home and suitable living environment for every American family. Housing is the cornerstone for healthy communities, a vibrant economy, and a competitive nation. Although we have significantly improved housing conditions in the last 60 years, we still have a long way to go. The latest figures in HUD's Report to Congress on the worst case housing needs estimate that 5.3 million very low-income renter households pay more than half of their income in rent or live in poor-quality housing. They receive no help. Many of those people are elderly or people with disabilities. Today, four of the leading non-profit affordable housing producers-- The Enterprise Foundation, LISC--the Local Initiatives Support Corp.-- Habitat for Humanity International, and the National Neighborworks Network--are committing to a $13 billion investment in low-income communities across the country over the next 4 years. Each have built successful partnerships, leveraging both public and private resources. These partnerships have been critical in supporting local nonprofits to not only build affordable housing but also provide services and encourage economic development to revitalize these neighborhoods. The success of these organizations reverberates in low- and moderate-income communities across the country as they address our widespread affordable housing needs. Their work is supported by Federal programs such as HOME, the Community Development Block Grant, and the Low-Income Housing Tax Credit. The Enterprise Foundation, based in Columbia, MD, is a true success story in the affordable housing industry. Founded by Jim Rouse in 1982, Enterprise has raised and committed more than $1.8 billion in grants, loans, and equity to finance the development of 61,000 affordable homes. They have a number of initiatives including the Enterprise Social Investment Corp. [EISC] which works with 176 major American corporations to help them find new ways to invest in affordable housing. Much of this activity has been made possible by the low-income housing tax credit. In addition, Enterprise, along with Fannie Mae, has created the Cornerstone Housing Corp., a nonprofit that buys and preserves large blocks of multifamily rental housing for low-income families. Enterprise also runs an intensive training program to assist nonprofit organizations in increasing their technical and management abilities. Habitat for Humanity International, since 1976, has provided approximately 55,000 homes through 1,336 local affiliates across the country. Using volunteer labor and tax-deductible donations, Habitat builds new homes and rehabilitates existing homes. An average three- bedroom Habitat home costs approximately $38,300, making homeownership for many low-income families a reality. The Local Initiatives Support Corporation, established in 1979, supports 1,400 community development corporations throughout the country. This partnership has created over 64,000 homes and 9.6 million square feet of commercial and industrial space. Neighborworks is a network of local resident-led partnerships supported by the Neighborhood Reinvestment Corporation, a public nonprofit chartered by Congress in 1978. The Neighborworks Network has produced 38,831 units of affordable housing since its inception and in the last 5 years has leveraged $1.5 billion in investment within communities. In Maryland, I have seen these partnerships work. The Enterprise Foundation, along with its subsidiaries, have developed more than 3,700 units of affordable housing and have committed more than $12.3 million in loans and $90.3 million in equity. In Sandtown-Winchester, Enterprise's Neighborhood Transformation Program has rebuilt more than 700 abandoned homes through a comprehensive community revitalization effort that works in partnership with local residents and the city of Baltimore. Neighborworks has three neighborhood housing services affiliates in Maryland--in Baltimore, Salisbury, and Cumberland. Between 1994 and 1996 alone these three Neighborworks affiliates produced over 600 units of affordable housing and leveraged over $24 million in investments within these Maryland communities. Habitat for Humanity has 16 affiliates in Maryland which have built 89 new homes and rehabilitated another 227 homes. Today these four organizations are challenging themselves and challenging us to continue our successful partnerships through the Community Development Block Grant, HOME, and the Low-Income Housing Tax Credit. These are programs I have supported and programs which have been critical in the production of affordable housing. The HOME Investment Partnership, for example, is an initiative I championed. HOME provides flexible grants to States and units of general government to implement local housing strategies designed to increase homeownership for low-income people. By requiring a 25 percent match, HOME encourages the public-private partnerships that have proven so successful in the production of affordable housing. Mr. President, I commend the work of these organizations and applaud Enterprise, LISC, Habitat, and Neighborworks for their commitment to invest $13 billion in our low-income communities. I fully support our continued role in this effective and successful partnership through Federal programs like HOME, the Low-Income Housing Tax Credit, and the Community Development Block Grant and urge my colleagues to do the same. This is an excellent step in the right direction, and I am pleased to have the opportunity to highlight the work of these organizations and the Federal programs that support them.

Mr. SARBANES

Mr. SARBANES. Mr. President, I am pleased to submit along with Senators Mikulski, Warner, and Akaka, this sense-of-the-Congress resolution. It is a simple resolution which clearly states that it is the sense of the Congress that Federal retiree COLA's should not be delayed. After 3 years of having their cost-of-living adjustments delayed, Federal retirees finally saw equity restored this year when their COLA adjustment became effective in January instead of April. Federal retirees should continue to receive their COLA on time, in line with all other Federal cost-of-living adjustments. According to the Congressional Budget Office, the average Federal retiree would lose an estimated $915 over the next 5 years if a three- month COLA delay is reinstated. To many of our Nation's more than 2 million Federal retirees, this can mean a significant difference in the calculation of their yearly living expenses. Further delaying Federal retiree COLA's would, in my view, set a dangerous, unfounded precedent where cutting or altering Federal retiree and employee benefits to effect cost savings becomes an all too regular and accepted practice. Mr. President, Federal retirees have served this Nation with the expectation that the benefits they have earned will be excluded from the pressures of achieving arbitrary budgetary targets. Disparate treatment of COLA recipients goes against longstanding congressional policy that for more than 25 years has ensured COLA equity for all retirees, and I urge my colleagues to join me in support of this important resolution.

Mr. SARBANES

Mr. SARBANES. Mr. President, I am pleased to join my colleague from Maryland, Senator Mikulski, in introducing this important legislation to ensure the protection of Federal employee pay and benefits in the event of a furlough. We have a responsibility to the men and women who have dedicated themselves to public service and I would hope that my colleagues would join Senator Mikulski and me in our ongoing effort to maintain the Federal Government's commitment to its dedicated work force. Federal workers have just experienced the most difficult Congress in recent history. Federal employees became hostages in the budget battle which resulted in two successive Government shutdowns. At this time last year, Federal employees were in a constant state of anxiety-- concerned about the future of their jobs, whether they would be laid off or have to work without pay, all as their workloads continued to accumulate. Despite this tremendous pressure and the constant attacks on their pay and earned benefits, Federal workers continue to provide consistent, quality service on behalf of all Americans. As I have stated many times before, Federal employees have already made significant sacrifices in past years in the form of downsizing efforts, delayed and reduced cost of living adjustments, and other reductions in Federal employee pay and benefits. It is, in my view, critical that we protect Federal employees from the type of senseless abuse they endured during the Government shutdowns last Congress. Federal workers should never again find themselves in a situation where, through no fault of their own, they may have to either work without pay or be prohibited from coming to work at all. Mr. President, Federal employees have made a choice to serve their country and we should respect and reward that choice by supporting these hardworking, dedicated individuals. Through the legislation Senator Mikulski and I are reintroducing today, we will continue to send the message to the Federal work force and to all American citizens that Congress honors and values the commitment those who work for the Government have made.

Mr. SARBANES

Mr. SARBANES. Mr. President, I am pleased to join my colleague from Maryland, Senator Mikulski, in introducing this important legislation to ensure the protection of Federal employee pay and benefits in the event of a furlough. We have a responsibility to the men and women who have dedicated themselves to public service and I would hope that my colleagues would join Senator Mikulski and me in our ongoing effort to maintain the Federal Government's commitment to its dedicated work force. Federal workers have just experienced the most difficult Congress in recent history. Federal employees became hostages in the budget battle which resulted in two successive Government shutdowns. At this time last year, Federal employees were in a constant state of anxiety-- concerned about the future of their jobs, whether they would be laid off or have to work without pay, all as their workloads continued to accumulate. Despite this tremendous pressure and the constant attacks on their pay and earned benefits, Federal workers continue to provide consistent, quality service on behalf of all Americans. As I have stated many times before, Federal employees have already made significant sacrifices in past years in the form of downsizing efforts, delayed and reduced cost of living adjustments, and other reductions in Federal employee pay and benefits. It is, in my view, critical that we protect Federal employees from the type of senseless abuse they endured during the Government shutdowns last Congress. Federal workers should never again find themselves in a situation where, through no fault of their own, they may have to either work without pay or be prohibited from coming to work at all. Mr. President, Federal employees have made a choice to serve their country and we should respect and reward that choice by supporting these hardworking, dedicated individuals. Through the legislation Senator Mikulski and I are reintroducing today, we will continue to send the message to the Federal work force and to all American citizens that Congress honors and values the commitment those who work for the Government have made.

Mr. SARBANES

Mr. SARBANES. Mr. President, I thank the distinguished Senator from Vermont for yielding me this time. Mr. President, there is no doubt that this is an extremely important vote that Senators are about to cast this afternoon. An amendment to the Constitution to require a balanced budget ought to give every Senator great pause. First of all, amending the Constitution is no light enterprise under any circumstances. Second, we ought to be certain that we are not falling into the trap of unintended consequences, that we do not pass an amendment that does more harm than good. In this respect, we ought to heed the advice which we have been receiving from many quarters with respect to the potential impact of this amendment to the Constitution on our ability to conduct wise economic policy. In this respect let me make four points in opposition to the balanced budget amendment. First, let me discuss the effect of this amendment on our ability to avert or slow economic downturns. Mr. President, over 1,100 economists have taken out an advertisement condemning the balanced budget amendment as unsound and unnecessary. Its signers include 11 Nobel laureates in economics, and they state-- and I quote: We condemn the proposed ``balanced-budget'' amendment to the Federal Constitution. It is unsound and unnecessary. They then go on to say--and I think this is an extremely important statement: The proposed amendment mandates perverse actions in the face of recessions. I repeat: ``The proposed amendment mandates perverse actions in the face of recessions.'' The statement continues: In economic downturns, tax revenues fall and some outlays, such as unemployment benefits, rise. These so-called built-in stabilizers limit declines of after-tax income and purchasing power. To keep the budget balanced every year would aggravate recessions. Secretary Rubin, the Secretary of the Treasury, testifying before the Senate Judiciary Committee, echoed these sentiments when he stated that the balanced budget amendment threatens to turn economic downturns into recessions and recessions into depressions. Mr. President, along these lines, I want to draw attention to this chart beside me which shows the fluctuations in real economic growth from 1870 to 1995. This is 1870 here. This is 1995 out here. What this chart shows is that since the end of World War II, when we began using automatic fiscal stabilizers--what the 1,100 economists call the ``so-called built-in stabilizers''--we have been able to greatly ameliorate the fluctuations in the business cycle. You still get business cycle fluctuations, but you do not get the boom-and-bust pattern which characterized the pre-World War II period in which a downturn would become a recession, and a recession would become a depression. We have had fluctuations since 1945. But they have almost always been in the positive range in terms of economic growth. Our economy has benefited enormously from this stability. When the economy slows down, unemployment rises, tax revenues fall off, and the paying out of unemployment benefits increases. We therefore automatically start incurring deficits which serve to slow down and head off the economic downturn. These automatic stabilizers have enabled us to significantly ameliorate the business cycle. As the economists' statement says, an amendment to the Constitution requiring a balanced budget would prevent this kind of countercyclical fiscal policy and, therefore, would greatly increase the risk of severe economic fluctuations during an economic downturn. Amendment supporters say, well, we will be able to see an economic downturn begin and we will get a supermajority to waive the amendment's balancing requirements. The fact of the matter is, however, that it is very difficult to tell when you are in an economic downturn. The beauty of the current system is that it automatically adjusts as the economy goes soft. As the economists said in this full-page ad in the paper, ``The proposed amendment mandates perverse actions in the face of recessions. In economic downturns, tax revenues fall and some outlays, such as unemployment benefits, rise.'' No congressional action is required for this system to go into effect. If, in an economic downturn, you try to balance the budget by cutting back on unemployment benefits and raising taxes in order to balance it, you will just drive the economy even deeper. In short, Mr. President, this amendment prevents us from doing the very things that have allowed our economy to stay on an even keel for the last 50-plus years. Second, Mr. President, it is very important to understand that we do not have a capital budget at the Federal level. The argument is being used by the proponents of this amendment that because State governments have to balance their budgets, local governments have to balance their budgets, business firms balance their budgets, and private individuals balance their budgets that the Federal Government should have to balance its budget. But none of these entities--not States, local governments, private companies, or households--would balance their budgets if they kept their budget the way the Federal Government does in accounting terms. There is no capital budget at the Federal level. State and local governments have a capital budget, and they borrow in order to finance it. I sat on a committee that received testimony from two State Governors in favor of the balanced budget amendment to the U.S. Constitution. One of the arguments they made in favor of the balanced budget amendment to the Constitution was that their State balanced budget amendments gave them a better credit rating for when they went into the bond market to borrow, allowing them to borrow at lower interest rates. Of course, my question to these Governors was, if you are required by your Constitution to have a balanced budget, why do you have to borrow? Their response was, ``Well, Senator, you don't understand. We borrow to finance the capital budget. Our constitutional requirement for a balanced budget is for the operating budget, but we can have a capital budget for which we borrow.'' Of course, it makes good sense to borrow for capital items. Businesses do it when they invest in new plant equipment and private individuals do it when they buy a home or a car. Very few people can afford to buy those items out of cash in the year of purchase. If you calculate prudently in terms of your expected income flow and the amount you are spending for the capital asset, it makes good sense to borrow in order to finance the capital asset, have the use of it over time, and pay it off over that period as you amortize the use of that capital asset. Business does it all the time. Private individuals do it all the time. So this analogy that amendment proponents draw to State and local government, private individuals, and business does not work because there is no capital budget at the Federal level. And amendments that were offered on the floor to introduce capital budgeting into the Federal accounting process were rejected. Third, it is argued that if we face an economic or military emergency, you will get a supermajority in this body in order to waive the amendment's balancing requirements. Well, Mr. President, we have seen the difficulty we have around here extending the debt limit by a simple majority. This legislation requires a three-fifths supermajority, three-fifths of the total membership of the body, in order to raise the debt limit. Very few of the efforts to raise the debt limit in recent years have had that kind of support. I have voted for debt-limit increases with Republican Presidents because I thought it was the responsible thing to do. But in many of those instances, even where there was some bipartisanship involved, the vote to increase the debt limit failed to garner 60 votes. The difficulty of gathering a supermajority simply cannot be overestimated. Yet amendment supporters assert, well, clearly, Congress will see a crisis and make the proper response. Our history, however, simply does not support that contention. Let me give you just one example, involving national security, because proponents of this amendment contend that it will not inhibit us from addressing our national security needs. In 1940, on the recommendation of President Roosevelt, the United States enacted a 1- year draft. The draft came up for renewal a year later, in the fall of 1941, not too long before Pearl Harbor. At this point, the House of Representatives had an intense debate about extension of the draft. Speaker Rayburn, in fact, went into the well of the House to appeal for the extension of the draft, saying it was essential for the security of our country. That extension passed in the House on a vote of 203 to 202. That vote would not meet the requirements of this balanced budget amendment, because to meet the requirements of the balanced budget amendment, you have to have a majority of the whole membership to waive the balanced budget amendment in time of national security emergency. The majority of the whole then--as now--would have been 218; 203 falls short of the majority of the whole requirement in the balanced budget amendment, let alone the supermajority requirements that are contained in the amendment. So those who place faith in the assumption that the Congress would easily waive the balancing requirements are much too sanguine. I am very apprehensive as to whether, either in a national security crisis or an economic crisis, we would be able to respond. In both instances, it is imperative to be able to respond early. The longer you wait, the more serious the problem, the further you fall behind the curve. This balanced budget amendment has the effect, at best, of delaying essential action, and at worst, of preventing such action at all. Fourth and finally, let me very quickly make the point that the way to balance the budget is to make the budget decisions that we are confronted with, not to amend the Constitution. We have been trying to do that, and we have had some good success over the last 4 years. We have brought the deficit down. How do you actually bring down the deficit? How do you really address this problem? What I have argued here this morning is that amending the Constitution carries with it great risks, as the economists in this article have indicated, and that we can do the job--and have been doing it--without a balanced budget amendment. I ask unanimous consent that the full economists' statement be printed in the Record.

Mr. SARBANES. Mr. President, will the Senator yield me 2 minutes?

Mr. SARBANES. To summarize once again the economists' statement, first of all, the balanced budget amendment would not enable us to respond automatically to economic downturns, running the risk, therefore, of turning recessions into depressions. Second, and I quote, ``Unlike many State constitutions, which permit borrowing of financed capital expenditures, the proposed Federal amendment makes no distinction between capital investments and current outlays. Private businesses and households borrow all the time to finance capital spending. The amendment would prevent Federal borrowing to finance expenditures for infrastructure, education, research and development, environmental protection, and other investment vital to the Nation's future well-being.'' If we had a capital budget right now, we would have a balanced budget, because there is well over $107 billion worth of capital items in the Federal budget. Third, I addressed the escape hatches and the difficulty of obtaining these supermajorities. That is really a recipe for gridlock. Fourth, and this leads again to my final point, we have brought the deficit down consecutively now for 4 straight years. How? We made tough decisions on spending and taxing. We voted for the 1993 economic plan. Many of those pushing the balanced budget amendment to the Constitution voted against that economic plan with respect to the budget. That was the plan that enabled us to bring the deficit down from $290 billion in 1992 to $107 billion in the past fiscal year--a cut of almost two- thirds in the deficit. That was done by making tough decisions. The chart beside me reveals this progress. An amendment to the Constitution, by itself, does nothing. You still have to make the budget decisions. We have been doing a good job of it. In fact, as this next chart shows, we have brought the deficit down from 4.9 percent of our gross domestic product down to 1.4 percent. This is the best performance in a quarter of a century, as a percent of GDP. So, Mr. President, we have been doing the job. And the way to continue to do the job is to address the deficit. As I noted, it is now down to 1.4 percent of GDP. This is better than any other major industrial power in the world. Chairman Stiglitz of the Council of Economic Advisors says he now goes to international conferences and everyone is talking about how well and how successfully the American economy is working. This figure--deficit as a percent of GDP, 1.4 percent--is better than any of the other major industrial countries. Consider this chart beside me. This is the U.S. deficit as a share of GDP, 1.4 percent. Here is Japan at 3.1 percent; Germany at 3.5 percent; Canada, 4.2 percent; France, 5 percent; the United Kingdom, 5.1 percent; Italy, 7.2 percent. So we have been doing the job, and we have been doing the job the way it needs to be done. In short, Mr. President, we ought not to meddle with the Constitution. We ought not run the risk of provoking economic prices, of preventing a timely response to a national security threat, of failing to make capital investments in the future of our country. Mr. President, I urge the rejection of this amendment to the Constitution. I thank the Senator from Vermont for yielding me time. Mr. HATCH addressed the Chair.

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

Mr. SARBANES. If the Senator will yield, it is certainly the dollar. Everyone is anxious to hold U.S. Treasury bonds. Let me say to my colleague, the Maastricht Agreement for the European Union set out certain criteria that countries had to meet in order to qualify for the monetary unit. These were regarded as extremely severe criteria. One criterion set out in the Maastricht Agreement was that they had to bring their deficit as a share of GDP down to 3 percent--3 percent. That is the target that those countries are working to achieve. Everyone says, well, that is a really tough standard that these European countries are trying to meet. The United States is at 1.4 percent.

Mr. SARBANES. Exactly. The year the Senator took out the mortgage, he was in violation of the concept of the balanced budget amendment to the Constitution.

Mr. SARBANES. If the Senator will yield.

Mr. SARBANES. Yes.

Mr. SARBANES. Twelve minutes.

Mr. SARBANES. Mr. President, I simply want to make this observation. Well over half of those budgets that the Senator from Utah points to in that pile would have been in balance if we had a capital budget. The fact of the matter is we didn't--and don't--have capital budgets. State and local governments have capital budgets. Businesses and private individuals have capital budgets. But we have a budget accounting system that requires us to cover the capital items as well as the operating items. If we had done budget keeping the way everyone else does budget keeping, well over half of those budgets would have been in balance. He talks about young people being born with a debt hanging over them. They are also born with a tremendous number of physical assets that have been purchased that are available to them for their use--a transportation network, a communication network, a research and development network, and an educational infrastructure. All have been paid for by previous generations for their use out into the future.

Mr. SARBANES

Mr. SARBANES. Mr. President, I am honored to join again with nearly 1 million Lithuanian Americans in commemorating the 79th anniversary of the proclamation of an independent Lithuania, especially at a time when the Lithuanian people are rebuilding their democracy. After more than seven centuries of struggle, the Lithuanians have finally succeeded in reestablishing an independent republic. While their hopes were realized once before in this century, their freedom was abruptly revoked in 1940, after 22 years of democratic governance. Throughout this long and difficult period, the people of Lithuania and the other Baltic nations never wavered from their beliefs in democratic values and their desires for liberty and freedom. In keeping with such a strong commitment, their independence after so many years is not only something to celebrate, it is an incentive for us all to rededicate ourselves to the democratic principles commemorated by this anniversary. Since 1990, when Lithuania rejoined the international community of democratic nations, the country has recognized the importance of meaningful political and economic reforms. Most significantly, Lithuania recently experienced another peaceful transfer of civilian rule, demonstrating the increasing stability of its democracy. Lithuania's commitment to continue along the path of economic reforms also promises greater prosperity in the years to come. A number of indicators suggest the possibility of a brighter future for the Lithuanian economy, despite the difficult period of transition that has resulted from the collapse of the Soviet Union. Gross domestic product is expected to rise this year, and continue to do so the next. Inflation is expected to decline. Industrial production is also on the rise. In addition, Lithuania has reached out to its neighbors, both those in the Baltic region and those further to the west. The Baltic Economic Cooperation Agreement and Lithuania's decision to join the Council of Europe are examples of this young democracy's determination to remain economically and politically engaged with the rest of the world. At this time of year, our thoughts also turn to those Lithuanians who suffered under the brutality of the Nazi and Soviet occupations. Many risked and lost their lives for the rights and freedoms that Lithuanians today are privileged to enjoy. Their steadfast determination and courage eventually prevailed, providing hope for all peoples who dream someday to be free. The writer Vincent Boris has observed that Lithuanian ``statehood was reestablished within a continuum of nationhood.'' Indeed, the Lithuanian people have drawn their strength from a very real sense that nationhood can never be oppressed. That sense of nationhood has been most evident here in the United States, where we have witnessed the unyielding dedication of Lithuanian Americans to the freedom of their native land. Their perseverance encouraged many of us to stand in this body over the last several decades and proclaim our support for a Lithuanian republic. We in Maryland, and our Nation, are particularly fortunate to have such an active Lithuanian-American community. Its longstanding traditions of self-help and voluntarism and its dedication to the democratic ideals that have prevailed in Lithuania have truly enriched the history of this country. In areas ranging from business, to academia, to the arts, Lithuanian-Americans consistently make significant contributions across the Nation. Mr. President, recently, Lithuanians gathered in their capital, Vilnius, to commemorate this anniversary. I am proud that we in the United States have continued to stand with them on this occasion, both in years when there was much to celebrate and in years when there were only memories and dreams of a better future. It is my sincere hope that we can celebrate this anniversary with the same optimism that we do this year for many years to come.