Nick Smith

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, reclaiming my time, I appreciate those announcements by my colleagues. I have been working on Social Security for the last 5 years. I am very concerned that we are putting off tough decisions that are going to mean that we either, in the future, substantially raise social security taxes on workers or we cut benefits. And we have done that before. In 1977, when we were short of Social Security funds to pay benefits, we both cut benefits and increased taxes. We did that again in 1983, when money was short in the Social Security Trust Fund. We again in that year cut benefits and raised taxes. So some people are suggesting that we add giant IOUs to the Social Security Trust Fund and assume that the Government is going to pay that money back at a later date. Let me briefly review a pie chart that shows the budget of the United States for this year. As we can see, the bottom green pie is Social Security. It represents 20 percent of the total budget. Defense only represents 18 percent of the total budget. The 12 appropriation bills that we spend most of the year arguing about is even smaller than the Social Security budget, with 19 percent. If we take all of the entitlement programs, it represents a little over half of the Federal budget. And here is what is projected by the Social Security Administration actuaries. They are suggesting that if we do nothing, social security taxes, taxes to cover our senior programs, will have to increase from the current 15-odd percent up to 40 percent within the next 38 years. That is if we do nothing. Two choices: either taxes are going to substantially be increased or benefits are going to have to be cut by over one-third. That is why I think it is so appropriate in this presidential election year that we have an articulate discussion on how to save Social Security. I was disturbed last night when Al Gore started criticizing Governor Bush's proposal that he has not even made yet. So demagogueing this issue is not going to help come to a final solution. It is going to jeopardize being able to work together. Look, we are not going to do this unless Republicans and Democrats work together. Here is a quick snapshot of the bleak future of Social Security. We have a short-term surplus coming in for the next 11 or 12 years on Social Security. After that we reach into somebody else's pocket to come up with the funds. The estimate from the actuaries is $120 trillion that we are going to be short in terms of our commitment to Social Security over and above what is coming in in taxes.

Mr. SMITH of Michigan. Mr. Speaker, I first want to yield to the gentleman from Maryland (Mr. Gilchrest). Tribute to Corporal John T. Weed

Mr. SMITH of Michigan. I yield to the gentleman from California.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, this chart is on Social Security. I have been very interested and concerned about Social Security for the last 5 years. I have introduced three Social Security bills that have been scored by the actuaries of the Social Security Administration that would keep Social Security solvent, would keep it going to the next 75 years. So three bills over the last 5 years. I also chaired the bipartisan task force on Social Security where we were very successful. We have bipartisan agreement on 18 findings that moves us ahead. Last night, I was listening to television, and I heard Al Gore talk about his proposal to fix Social Security and criticize Governor George W. Bush's suggestion that we allow some of that money to be kept and invested by individuals. I was so concerned that I took an earlier flight so I could speak this noon on Social Security. I criticize Mr. Gore for suggesting that we do not have to do anything to fix Social Security. Chris Lehane, Mr. Gore's spokesman, says that one of the reasons Social Security has been so successful is that it depends on one generation to take care of another generation. When in fact there is no need to do anything right now, Mr. Gore suggests that we use the extra money coming in from Social Security. Look at this chart a minute. We have got a short-term, where there is more money coming in from Social Security taxes than is needed to pay out benefits. Mr. Gore suggests that we take some of this money, we borrow from this fund, and we use that money to pay down the debt, the so-called Wall Street debt. It is also so disconcerting that ABC, NBC, CBS pick up those press releases out of the White House that says we are going to pay down $180 billion of debt this year, and that is good, we are moving in the right direction, but what is happening is we are borrowing the money from Social Security to pay down the Wall Street debt so the $5.7 trillion that we now have as a national debt continues to go up. Maybe an analogy is saying that Mr. Gore suggests that we take out one credit card and we use that credit card to pay off another credit card when there is no real money out there. I think this is the time in this presidential election year to discuss and debate how we are going to fix Social Security, how we are going to keep it there, not only for the existing retirees and the near retirees, but for future generations. It is the most important program that probably we have in government. It is the largest program in this country. It is the largest program in the world. What is happening is some people suggest, look, the United States is as good as its word. If it borrows the money, it is going to pay it back. Even if it paid it all back, it is only going to keep Social Security solvent until 2034. But will the Federal Government pay that money back? Where is it going to come from? We are going to have to increase borrowing, cut other government programs, or increase taxes. That is where it is going to come from. As a demonstration of Federal Government's commitment, this Congress and the President, in 1977, when there was a problem of fewer dollars coming in than was needed to pay out benefits, what did they do? In 1977, they increased taxes and reduced benefits. In 1983, again, we ran out of enough money to pay benefits, so, again, they reduced benefits and increased taxes. If we do nothing, I say to Mr. Gore, then taxes are going to increase up to 55 percent, increase in Social Security taxes for our kids. That is what the trustees of the Social Security Administration said. If we do not want to increase taxes, then we cut benefits by 33 percent. This is an appropriate time to discuss where we are going to go on Social Security to keep it solvent. If my colleagues look at the red area, how much we are going into the red over the years, the Social Security actuaries project that we are short $120 trillion. Remember, our annual budget here is $1.7 trillion. Over the next 75 years, we are short $120 trillion of there being less money coming in from the Social Security tax than we need to pay out the benefits that are promised. If we look at the possibility of getting real investment, then all we have got to do is beat a zero percent return. Some of the think tanks around town have projected that one is not even going to get back the money that one paid in. Some of the projections go as high as a 1.7 percent return on the Social Security money that one pays into Social Security. Can the stock market do any better than that? The average for any 12- year period since 1926 has been 3.7. The average for a retiree's lifetime has been up to a 7.88 percent return. We can do better than Social Security. Let us move ahead. Let us debate it. Let us discuss it. Let us not hide the problem under the rug.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I have been on the Committee on the Budget for a full 7 years. This is my eighth year. This will be only the second budget that we have passed on time by April 15 during that time. In fact, in the total history of the Committee on the Budget, this will only be the third time that we have passed a timely budget resolution. So I would like to compliment the Committee on Rules, certainly the gentleman from Ohio (Mr. Kasich) on the Committee on the Budget. If we look at where we were 7 years ago, we were looking at deficits as far as the eye could see, between $200 billion and $300 billion a year. We have come a long ways. We made the decision last year that we are not going to spend any of the social security trust fund surpluses on anything except social security. This has been a huge change, huge progress. We have agonized as we have tried to hold down spending to make sure ultimately that our kids and grandkids are not going to be saddled with a huge burden of Medicare and social security. If there is one disappointment in this budget, and I met and talked to John Podesta this morning from the White House, it is that we could not get leadership from the White House to move ahead on social security reform. It is going to come up and be a tremendous disadvantage to our kids and our grandkids if we do not attack and face up to the huge problems of resolving the unfunded liability of social security and Medicare and the entitlement programs.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, it is my honor today to recognize a great American on the occasion of his recent selection by the National Immigrant Forum, in conjunction with the Immigration and Naturalization Service, as one of 200 most famous American immigrants of all time: Grand Master Jhoon Goo Rhee. Master Rhee, who shares the honor with such American icons as Albert Einstein, Hyman Rickover and Knute Rockne, is the sole immigrant of Korean ancestry to make the list. Well known as one of the world's foremost authorities on the martial arts and recognized as the father of Tae Kwon Do in the United States, Grand Master Rhee has established himself as more than just a famous instructor. But his road to success and achieving the American dream wasn't easy, nor would he have wanted it that way. When Jhoon Rhee came to the United States in 1956, he spoke little English and had less money--$46 to be exact. Still, he enrolled at Southwest Texas State Teachers College in San Marcos determined to create a better life for himself. Although at first it took him a half- hour to read one page of text, he became increasingly proficient in English through discipline and perseverance, traits that for decades he has so eloquently translated from the martial arts for people from all walks of life. Those traits also are the core of his action philosophy, a philosophy grounded in the principles of the martial arts, but applicable to everyone. It calls for people to build confidence through knowledge in the mind, honesty in the heart and strength in the body, and then to lead by example. Leading by example is exactly what Master Rhee does. Despite his 68 years, each day as part of his daily stretching and meditation regimen, he does 1,000 push-ups and 1,000 sit-ups. Not even the fittest 20 year- old can match those feats. But the discipline, determination and perseverance involved are life lessons that far transcend martial arts and athleticism. He has enabled people everywhere to realize their potential and apply themselves successfully to whatever it is they set themselves to do. It's the philosophy Master Rhee embraced so long ago and which has stood the test of time--the same philosophy which took him from someone who barely could speak the language of his new country, to one of the world's most sought-after motivational speakers. There is no dream too large for Grand Master Rhee, but I'm sure even he has difficulty comprehending how many millions of people around the world owe their positive, constructive ways of living to his wholesome influences. Many of our colleagues, Mr. Speaker, know first hand Master Rhee's call to realize the aspects of life larger than self. We know this because he founded the U.S. Congressional Tae Kwon Do Club and has taught more than 250 current or former Members of Congress not only the art of Tae Kwon Do, but also the art of living a healthier and happier life. We know the affection he engenders to all who make his acquaintance, whether through athletics, business or when hearing his motivational presentation. Master Rhee's success is wide ranging. Aside from his accomplishments in Tae Kwon Do and in training world-class athletes, he has starred in feature films, authored a number of books, served as a goodwill ambassador and started a hugely successful business venture. He also is held in the highest regard as an innovator and teacher. But perhaps where he excels most is in an area that is missing so dearly in today's world--the role of husband, father and citizen. Jhoon Rhee deports himself with the utmost respect and dignity for those with whom he deals and with society in general. For more than 50 years, he has embraced the role model aspect of a life that comes with international renown, a role taken for granted by so many and perfected by so few. He gladly accepts the responsibility of presenting himself and his way of life as an emblem to be worn proudly. This is not just my assessment. His contributions to buttress America's culture with pride and decorum are echoed by many distinguished citizens in and out of government. Among his biggest fans are boxing legend Muhammad Ali, Parade magazine Publisher Walter Anderson and motivational speaker Tony Robbins. Jack Valenti of the motion Picture Association of America has said, ``Master Rhee defies the assumed rush of years. He is an ageless patriot, whose brand of unbreakable loyalty is seldom seen. . . .'' Our esteemed colleague Ike Skelton says, ``Master Rhee is an American treasure.'' Our esteemed former colleague Bob Livingston says it quite simply: ``Master Rhee is one of the greatest Americans I know.'' At an age when even the most industrious of people tend to enjoy the leisure of their later years, Master Rhee at age 68 continues with remarkable energy to exert his positive influence on people of all ages throughout the country and the globe. He has recently launched a new global project, the JhoonRhee.com Web site, where he continues to promote the martial arts, fitness, the healing arts and a way of life whereby, in his words, ``Everybody is happy with every breath of life.'' On March 17, 1992, President George Bush named Master Rhee one of his Daily Points of Light. President Bush said, ``The true measure of any individual is found in the way he or she treats others--and the person who regards others with love, respect and charity holds a priceless treasure in his heart . . . any definition of a successful life must include others. Your efforts provide a shining example of this standard.'' Master Rhee's devotion to the principles of America's Founding Fathers is unsurpassed. He instills in his countrymen the Founders' vision and demonstrates the power of that vision to people throughout the world to show them the path to freedom, peace and prosperity. He understands that everyone on this planet has the right to be happy. But to achieve that happiness, individuals must accept the foundation of perfect human character that entails exercising true freedom approved by one's conscience, and never to practice false freedom licensed by selfishness. Master Rhee is a proud American who cherishes the words freedom, free enterprise, democracy and heritage. He lives the American Dream. Indeed, he exemplifies it. He inspires all, and with a special enthusiasm toward the young, to live lives of honor and integrity. The eloquence and conviction of his message to live noble lives of grand purpose penetrates the most hardened hearts and cynical souls. His accomplishments are legion. A 10th Degree Black Belt, he introduced the martial arts to Russia in the early 1990s, where now there are 65 studios that bear his mane. He is the author of five books on Tae Kwon Do, a member of the Black Belt Hall of Frame and the recipient of the National Association of Professional Martial Artists' Lifetime Achievement Award. He was named by Black Belt Magazine as one of the top two living martial artists of the 20th Century and also as ``Martial Arts Man of the Century'' by the Washington, D.C., Touchdown Club. He has been featured on the cover of Parade, collaborated on several projects with Bruce Lee and had the lead role in the films. When Tae Kwon Do Strikes and The Silent Master. Additionally, he created and choreographed the martial arts ballet--the basis for today's popular ``musical forms'' competition--and invented and implemented the safety equipment used in major open tournaments, including the 2000 Olympic Games in Sydney. I would like to summarize some of Master Rhee's accomplishments, a truly impressive list of famous firsts. He was the-- First master to teach Tae Kwon Do in America: Master Rhee introduced Tae Kwon Do to America in 1956. First master to work out to music: Master Rhee created the Martial Arts Ballet and gave birth to the Exercise to Music craze. First master to invent safety equipment: Master Rhee invented martial arts safety equipment after one of his students was injured in a competition. The introduction of safety equipment enabled martial arts studios to get insurance. Because of that, parents began to send their kids to martial arts instructors, and the martial arts industry was born. First master to promote martial arts in the U.S. through television advertising. First master to use the color belt system: At one time, martial arts awarded only white, brown or black belts. Master Rhee introduced the color belt award system now used worldwide. First master who also is a concert musician: Master Rhee was the featured musician with the Washington Symphony Orchestra. He played classical music on the harmonica. First master to require black belt scholastic excellence: For more than 30 years, Master Rhee has required his students to maintain a ``B'' average or better to qualify for a black belt. First master to train Members of Congress in martial arts: Master Rhee founded the U.S. Congressional Tae Kwon Do Club, where he has taught Members of Congress without interruption since 1965. First American to open martial arts studios in the Soviet Union: Master Rhee first traveled to Moscow in 1991 to teach Tae Kwon Do and now has 65 Jhoon Rhee Do studios throughout the Commonwealth of Independent States. Learning English is a requirement for a black belt. First to teach martial arts in America's public schools: Master Rhee launched his Joy of Discipline program of martial arts and character education in America's public schools in the early 1980s. First Tae Kwon Do master to star in his own movies: Master Rhee starred with Angela Mao in When Tae Kwon Do Strikes. As Grand Master Lee, he is the underground leader of a group of patriots in Japanese occupied Korea. First martial artist to train a world heavyweight boxing champion: Master Rhee taught the legendary Bruce Lee his kicking techniques, and Bruce Lee taught him how to punch. Master Rhee then taught Muhammad Ali what Ali later called his powerful ``Accu-punch.'' Ali used it in 1976 to knock out Bruce Denn in Munich and also in the Joe Frazier heavyweight title bout. First martial artist to be named Man of the Century: And now, Master Rhee is the first and only native Korean to be named as one of America's top 200 immigrants of all time. Mr. Speaker, the National Immigrant Forum made a wise choice. He is a man of character and the prototype role model for the new century. I can think of few others so worthy of such a designation.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, gene technology has come of age. It is referred to under different names: genetic engineering, gene splicing, bioengineering, recombinant DNA. No matter the name used to describe it, this technology represents the latest tool in a continuum of techniques researchers have developed and adopted over the centuries. As chairman of the Subcommittee on Basic Research of the Committee on Science, we have spent the last 14 months studying this new biotechnology of genetically modifying products. We will be releasing probably the most inclusive and detailed report this coming Thursday at 2:30 at a press conference in Room 2320, the Committee on Science room. It is a summation of the findings of a series of three hearings held during the first session of the 106th Congress by our Subcommittee on Basic Research entitled, ``Plant Genome Science: From the Lab to the Field to the Market.'' Additionally we have talked to and counciled with many other world experts on this subject. What is truly powerful about this technology is that it allows individual, well-characterized genes to be transferred from one organism to another, thus increasing the genetic diversity available to improve important commercial crop plants as well as pharmaceuticals. The potential benefits to mankind are limited only by the resourcefulness of our scientists. Biotechnology has been used safely for many years to develop new and useful products used in a variety of industry. More than a thousand products have now been approved for marketing, and many more are being developed. These products include dozens of therapeutics, including human insulin for diabetics, growth factors used in bone marrow transplants, products for treating heart attacks, hundreds of diagnostic tests for AIDS and hepatitis, and other infectious agents, enzymes used in food production, such as those used for the production of cheese and other products. And this is just the beginning. In agriculture, new plant varieties created with these techniques will offer foods with better taste, more nutrition, longer shelf life, and farmers will be able to grow these improved varieties more efficiently, leading to lower costs for consumers and greater environmental protection. Soybeans that produce high oleic oil containing less saturated fat and less processing; cotton plants that fight pests or produce naturally colored cotton, reducing the need for chemical dies; bananas that deliver vaccines to fight enteric diseases are just a few examples of what is in store. While millions of lives all over the world have been protected and enriched by biotechnology, its application to agriculture has been coming under attack by well-financed activist groups. The controversy they have generated revolves around probably three basic questions as I have defined them: one, are agricultural biotechnology and classical breeding methods conceptually the same? Two, are these products safe to eat? And three, are they safe for the environment? The testimony and other material made available to the subcommittee as we have met with leading scientists throughout the world lead me to conclude that the answer to all three questions is a resounding yes. In fact, modern biotechnology is so precise and so much more is known about the changes being made that plants produced using this technology may even be safer than traditionally bred plants. This report contains background information on the development and oversight of plant genetics and agricultural biotechnology, a summary of the subcommittee hearings, and my findings and recommendations based on these hearings. I hope that it will be of use to all of the scientists and researchers in America as we examine this important issue of biotechnology. The human genome effort and the plant genome effort with the arabidopsis thaliana is being completed well ahead of schedule and will have a tremendous impact on our lives and the lives of people all over the world. We need to move ahead, but we need to make sure that scientific facts and not rumors and scare tactics are the basis of information to the general public. Politically motivated misinformation can slow down the advancement of a science that has so much potential for mankind.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Chairman, I want to say that I also am introducing a bill that hopefully takes care of this problem. I think because those with low-income need this protection, because fire departments are seeing a lot of damage in those homes that have bad wiring, it is a consideration that we need to work out; and we are going to do that. So in a more complete bill, we are headed in that direction.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Chairman, adopting this amendment is going to demonstrate the firm commitment this House has to those individuals who literally put their lives on the line. Fire fighters, first responders, lost 100 lives last year, half as many as all the law enforcement people in this country. We need to move ahead in this area. There are 32,000 fire departments. They need help. This allows more research, more funding, and it is going to be the kind of gesture that is really going to put us on the front line. When we have disasters it is the first responders that are there, whether it is a shooting, whether it is a hurricane, whether it is a tornado or a volcano or earthquake. It is the people who want to help the school when there is a fundraiser, it is the first responders and firemen who come to that assistance. Let us give them this support. I thank the gentleman from Maryland (Mr. Hoyer), the gentleman from New Jersey (Mr. Pascrell), and certainly the gentleman from Pennsylvania (Mr. Weldon), and many others who have joined in in making this a bipartisan effort. Mr. Chairman, this Nation is well-served by the 1.2 million men and women who work as fire and emergency services personnel in over 32,000 fire departments across this country. They play a crucial role protecting and preserving our lives and our property . . . a dangerous role--an average of nearly 100 firefighters a year lose those lives in the line of duty. Eighty percent of those who serve do so as volunteers. This amendment recognizes the contributions of volunteer firefighters by providing $10 million to fully fund the USDA's Volunteer Fire Assistance Program. This program allows the nearly 28,000 rural fire departments nationwide to apply for cost-share grants for training, equipping and organizing their personnel. These rural fire departments represent the first line of defense for rural areas coping with fires and other emergencies. This amendment also establishes two grant programs at the Federal Emergency Management Agency. The first is an $80 million competitive grant program for volunteer and paid fire and emergency services departments. With these 50/50 matching grants, departments can get assistance acquiring safety equipment, firefighting and communications equipment, funds for training, and assistance funding fire prevention programs. In addition, this amendment establishes a $10 million burn research grant program through FEMA. Under this program, safety organizations, hospitals, and governmental and nongovernmental entities that are responsible for burn research, prevention, or treatment are eligible for competitive grants to continue their important work. We see our firefighters and EMS personnel responding to emergencies every day, more than 18 million calls a year. From car accidents, to brush fires, to large scale disasters like the tornadoes that ripped through Ft. Worth last night, emergency responders are first on scene, first to react, first to provide the assistance we've come to take for granted. Mr. Chairman, adopting this amendment would demonstrate the firm commitment this House has toward these emergency first-responders, to those who literally put their lives on the line each day. I'm thankful for the bipartisan support this amendment enjoys, and I'd like to thank my colleagues Mr. Weldon, Mr. Hoyer, Mr. Pascrell, and Mr. Andrews for their work helping bring this to the floor. I urge your support for this important bipartisan amendment.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, this week the House is considering H.R. 7, the Education Savings and School Excellence Act of 2000. For years, we have watched as our education quality has gone way below the standards set by other nations. For example, the U.S. 12th graders currently test among the lowest among the industrialized nations in math and science. If our Nation is to continue setting the standard for the rest of the world in science, research, and technology, then we must take steps now to help ensure that each child learns to their maximum ability. Mr. Speaker, this education savings account will allow a Roth-type IRA for investment to help assure the best possible education for academic tutoring, for books, for fees, computers, special education services and other education need. I understand Vice President Gore has now supported tax credits, tax deductions for contributions that will go into political campaigns, but he has denied support for this bill that allows families to have some kind of tax incentive for savings to help assure the best possible education.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, there are too many curiosity questions on the Census long form. Right now, on the average, one out of every six citizens of the United States that are sent the census long form are asked questions that take almost 25 minutes to fill out, very personal questions, very intrusive questions. What we have been investigating and looking at is should there really be a $100 fine if you refuse to answer all of those personal, intimate questions. It asks all sorts of information that the government does not need to know, such as the number of rooms in your house, when it was built, where your water and utilities come from, how much they cost, how much you paid for your house, the number of cars, telephones, bathrooms you have, how much insurance you carry on the contents of your home. It asks about your education, the time you leave for work, how you get there, your health, your job. This is simply excessive, and I am suggesting a couple of things. Number one, I suggest that there should not be a $100 fine if you fill out the pertinent information. This was put in our United States Constitution so every 10 years we could have a new count of the number of individuals in the United States so we could reapportion congressional districts for the 435 Members of Congress. It was not the intent that we expand this to allow an administration, a bureaucracy, a Washington group to pursue all kinds of personal information that they might want to know sometime about you. We are suggesting that if you fill out the forms and that if you fill out the number of people and their names, in essence, the questions on the short form, there should not be any fine, or any fine that would exceed $5 or $10. I think with our new technology in this country, with the ability of government to know so much about us, knowing what doctors we go to, when we go to the doctor, for what reason we are going to the doctor, where we buy, what kinds of goods, where we travel, the danger is a government that, out of curiosity, would like to know more than they really need to know about our individual lives. I am saying that we need to totally review the Census form. I hope the information that came out yesterday, that a Federal judge in Texas has said that there should be no prosecution for any individual that does not fill out the rest of the long form and those intrusive questions, is correct. In the meantime, I think it is time that this body and the United States Senate, along with the administration, re-evaluate its intrusiveness. It is bad enough that we are taking 41 cents out of every dollar the average American makes in local, State, and Federal taxes. It is worse when we start getting into their lives, their bedrooms, to try to have the kind of information that we think we need to know to make that kind of policy decision. It is time we slowed down the intrusiveness of the Federal government. It is time that Americans started asking their Representatives in Congress, in the United States Senate, I include in that, and their potential next President their position on this issue.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Chairman, I say to the gentleman from Missouri (Mr. Skelton), my understanding is, I read in the Democrat Spratt budget that my colleagues are putting in the same amount that the President did at $306.3 billion, and the Republicans are putting $307.3 billion into the defense. How they divide it up, we were not as articulate as our colleagues are, but just the fact that we are upping them one on the military budget. I would yield to the gentleman, but I only have a minute to talk about what I need to talk about, and that is where we are going on Social Security. Too often I think Republicans want to move ahead and do not look back to how much they have accomplished. And what we have accomplished is significant since 1995, when we took the majority. We actually for the first time in almost 40 years quit using Social Security surplus for other Government programs. What has happened is, in 1995, we were looking at on-budget deficits of approximately $300 billion. Today we have a surplus. We are moving ahead in the right direction. I am disappointed that this budget, Republican, Democrat, nobody else, deals with the huge problem of really fixing Social Security. The Democrat budget says they are extending the life of Social Security and Medicare by 13 years and 10 years, respectively, but actually what they are doing is adding just two more giant IOUs to those trust funds. It does nothing to fix the program. That has got to be the challenge in the years ahead.

Mr. SMITH of Michigan. I yield to the gentleman from Missouri.

Mr. SMITH of Michigan. Mr. Chairman, reclaiming my time, I agree. If the Spratt budget is the same as the budget of the President budget, we add an additional $1 billion to up that budget by, I think, $18 billion.

Mr. SMITH of Michigan. Mr. Chairman, I agree with the gentlewoman from North Carolina (Mrs. Clayton) that ag and farmers deserve better. But I think it should be very clear that in our budget, unlike the budget of the President, we immediately put in $6 billion for use and then we add another $6 billion over the next 5 years for crop insurance to beef up that program. So, for the first time ever, we put in ahead of time $6 billion right away.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I honor today Robert B. Miller, Jr., of Battle Creek, Michigan, Scene Magazine's 1999 Man of the Year. ``Bob,'' as he likes to be called, is one of Battle Creek's best known citizens due in large measure to his legacy of personal and financial commitment to the greater Battle Creek community. Today, the community will show its appreciation and gratitude for Bob's many years of philanthropy and dedication, as they gather to pay tribute to him as the 1999 Man of the Year. Robert Miller, Jr. is a naval veteran and graduate of Michigan State University, with degrees in marketing and English. He has spent most of his professional life in the print media, working for such newspapers as the Lansing State Journal, Idaho Statesman and the Daily Olympian, before making his mark on Battle Creek as publisher of the Battle Creek Enquirer and News, a position he inherited from his father, the late Robert Miller, Sr. Robert Miller, Jr. epitomizes the word philanthropy. He has been as much involved in civic duties as he was in professional journalism. He's served as a trustee of the Miller Foundation and as a member of its Grants Review Committee, as well as being a member of the local Red Cross, United Way and numerous other boards and committees. Most recently, he can be found working on behalf of the Humane Society and as an advocate for Big Brothers/Big Sisters. As a professional, Bob has led by example, blending strength, drive and determination with tremendous character, devotion and kindness. I admire Bob for his professional involvement and dedication to civil activities and service to the community. He exemplifies what it means to be a citizen, having set a standard of excellence which serves as an example for others in the community. I commend Robert B. Miller, Jr. for his many years of hard work and tireless devotion in making his community a better place to live, work and raise a family. And I congratulate him on being named Scene Magazine's 1999 Man of the Year.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, I would like to discuss for the next 4 or 5 minutes why everybody is talking about Social Security, why they are concerned that Social Security is in trouble some time in the future, why young people today think the chances of their getting any Social Security are pretty remote. It is the young people today, probably under 35 years old, that are most at risk in not having Social Security in their retirement years if we continue to fail to do anything to keep Social Security solvent. The chart that I brought in represents where we are now. If we look at the top left part of the chart, the little blue area in the top left is the current surpluses coming in to the Social Security trust fund, in other words, the amount of taxes that are in excess of benefits payments going out. That is going to stop around 2011 or 2012. At that point, there are going to be fewer Social Security taxes coming in than are needed to pay current benefits. Of course, Social Security, since it started in 1935, has been sort of a Ponzi game where current workers pay in their taxes that is immediately sent out to current retirees, and so it is a pay-as-you-go program. The red portion represents where we are in terms of what is going to be the additional amount of dollars needed to pay current Social Security benefits in future years. We get down to 2019, and we are going to need something like $400 billion additional money from some place, either increased taxes or increased borrowing, to pay promised Social Security benefits. It is a problem. We are now looking at probably the best economic times in the history of the United States, where we are having a surplus of total revenues coming into the Federal Government. The question is now, do we use those revenues to spend on new expanded social programs and expand the size of Federal Government? Do we use those monies to start solving the Social Security problem? Here is what is needed: right now the average retiree that retires from now on is not going to get the money back that they and their employer put into Social Security, so essentially a zero-percent return on their finances unless they are lucky enough to live into their 80s and 90s or to be 100 years old. So what do we do? I think one thing we have to do in the first place is to understand the seriousness of the problem. To demonstrate how serious it is, I projected what is going to be needed in payroll taxes if we do nothing in the next 30 or 40 years. If we are going to have a FICA tax, a payroll tax, that accommodates the needs of Social Security and Medicare and medicaid, Social Security taxes are projected to go up to be 40 percent of one's income within the next 35 to 40 years. All we have to do to verify that kind of serious situation, increasing the cost of producing everything we produce in this country, is to look at what is happening in Europe, in Japan. Several countries now in Europe are up to that 40 percent mark. Japan is approaching it. A country like France, the effective payroll deduction to pay for the senior programs in France now is approximately 70 percent of payroll. It is no wonder that France is finding it very difficult to compete in the world market. If we do nothing in this country, if we keep putting these proposed solutions off because it is easy to demagog, because really there is only two ways, Madam Speaker, to fix Social Security and to fix Medicare. We either bring more revenues into the program or we reduce the amount of money coming out. That means increasing taxes or reducing benefits. One way to increase revenues, though, is starting to get a better return on the investments coming in to Social Security, coming into Medicare. That means investing some of that money in real returns with real investments. That is why I have advocated for the last several years that we have personal retirement savings accounts that can draw real interest returns so that modest-income workers today can retire wealthy because of the magic of compound interest. My grandson painted our fence this last summer, and I tried to convince him to put his money into a Roth IRA, and we figured what that money would be worth 50 years from now. He said, Grandpa, I want to really buy a car with that money and save up for a car. So we went step by step, year after year to see if that money would return revenues and we found out that $160 would turn into $70,000 by the time he was ready to retire. We have to have some real retirement accounts. We have to start getting real returns on the money that is coming in from Social Security.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Especially if you exercise and you live longer than the average, then you of course are going to get more than your money back. So everybody should exercise, all seniors should contribute to the workforce and contribute their talents, now they can do it under this legislation.

Mr. SMITH of Michigan. Right now under the legislation as we amended it in 1983, it started at 2 percent per year increase after age 65, then it went to 4. This year it is going to 6 percent. The amendment that I have proposed would move it up to 8 percent, which is the actuarially sound amount. If you are going to live an average life span, then it is reasonable if you put off taking benefits and continue working, continuing paying the FICA tax to support Social Security, it ends up ultimately being somewhat of an advantage and so moving that 8 percent per year up until you are age 70 is a reasonable step to take.

Mr. SMITH of Michigan. There are a lot of parents of this bill. The gentleman from Texas is one of those parents. This is something that has been in the works with bills introduced for the last 15 or 16 years trying to correct an injustice. It is interesting it has taken us this long. Then there is a unanimous vote to move ahead. When it is an injustice and it is moving ahead with fairness, then I think there is a general attitude in this Chamber when it is reasonable, when it is fair, when it is getting rid of something that is unjust, then it is very good. I would just say there is another provision that I hope we can move ahead with in terms of fairness, in terms of encouraging individuals to work, and, that is, to increase benefits for individuals that, at age 65, decide to delay taking those Social Security benefits. And so if they wait a year, they should end up with more benefits. It is called delayed retirement credit. A provision of this bill that would make an 8 percent increase in benefits for every year was an amendment that I hoped to incorporate in this bill someplace along the line. I talked to the White House, the President has agreed to it, the Democrats and Republicans have agreed to it. The actuaries at the Social Security Administration have suggested that it does not cost money because actually it might save money encouraging individuals that want to delay taking Social Security to have an increased benefit later on, to make it actuarially sound. Another point that I think is important in this issue is that widows eventually would have the higher benefit when they become widows. This kind of action, the kind of piecemeal approach of sending one bill at a time to the President I think is the right policy decision, so you can measure the merits, the pros and cons of each policy. Again my congratulations and thanks to the gentleman from Texas for having this hour.

Mr. SMITH of Michigan. Sam, everybody salutes you. You are a great American and a great veteran.

Mr. SMITH of Michigan. It is so interesting. I chaired the Social Security task force. The futurists for health care are suggesting that within 25 years, anybody that wants to live to be 100 years old would have that option. Within 35 to 40 years, anybody that wants to live to be 120 years old will have that option. This is just another signal that everybody, especially younger people, better save now, so save and invest now, because who knows what medical technology is going to do.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I am proud to stand with members of Congress who have introduced bills that advocate comprehensive reform of Social Security. We understand the immensity of the challenge facing the country as baby boomers retire, how demographics result in a huge responsibility for future generations, and the importance of preparing Social Security for the future. You will find repeal in the Social Security Solvency Act for 2000, which I introduced in November. Bills that I introduced this year and last year, including the Social Security Solvency Act for 2000, included elimination of the earnings limit, plus another provision that I consider to be the counterbalance to the earnings test--accelerating the increase in the ``delayed retirement credit'' or DRC. If a worker decides to continue working after 65 and defer his monthly benefit, the DRC increases the size of his monthly check he will ultimately receive from Social Security. A worker who turns 65 this year will see his benefits increase 6 percent for every year he defers his benefit. Current law allows a worker to delay retirement for up to five years, working until he reaches 70. If that retiree's monthly benefit was $1,000 when he turned 65, it will be $1,300 if he puts off receiving a Social Security check until he's 70--that's an extra $3,600 a year. However, if that worker enjoys an average length of retirement, this delay puts him at a disadvantage. He should be receiving an extra $4,800 a year, not $3,600. Under current law, the DRC is set to rise to 8 percent in 2008. This is the amount that Social Security considers to be ``actuarially sound.'' That means that a retiree who delays receiving his benefit is getting proper compensation in the future for the money he does not get today. As we eliminate the earnings limit, it is reasonable to include an increase in the DRC. Retirees deserve a fair deal today--not in 2008. Now that we are taking away the earnings limit that discourages senior citizens from working, we should accelerate the DRC and encourage them to ``save'' so they have a higher benefit during the years they no longer have outside earnings. The accelerated DRC will encourage people to work as long as they choose. The Social Security actuaries have examined my proposal to accelerate the DRC, and they say it is actuarially sound. It doesn't cost taxpayers or weaken the Social Security trust fund. There are three reasons to accelerate the DRC: 1. Fairness--Give workers who choose to delay receiving their Social Security benefit an increase that is consistent with actuarial assumptions. 2. Choice--Give senior citizens more options to manage their retirement--they choose when they retire and when they should apply for benefits. 3. To Fight Poverty--Give a higher survivor benefit to widows whose spouses took benefits based on the DRC. When I learned of the Ways and Means markup of H.R. 5, I approached Representative Shaw and Representative Archer, and presented my amendment to accelerate the DRC. After careful consideration by the Social Security subcommittee, I received agreement to add this amendment. Gene Sperling called me on the evening of Feb. 28 to tell me that the President had agreed to support it, and the minority gave their consent on Tuesday. This amendment is to too important to be stalled by politics. I will continue to fight for its inclusion, and I remain optimistic that I will see the DRC acceleration language in the bill that President Clinton finally signs into law.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, I would like to talk today about a couple of challenges facing this country. One challenge is, is there a way to improve our budget process? Should we go to a biannual budget or other techniques that might be used to better serve the taxpayers of this country? And the second issue is the tremendous challenge of keeping Social Security and Medicare solvent. In yesterday's Roll Call there was an article on page 46 of yesterday's Roll Call, I wrote an article: ``Entitlement Reform the Way to Go.'' Madam Speaker, I include for the Record a copy of the article on page 46 of yesterday's Roll Call: The One Thing I Would Change About Congress . . . Entitlement Reform the Way to Go (By Rep. Nick Smith) For 224 years, Congress has wrestled with the budget. As an ex-wrestler and current Budget Committee member, I know that can be both strenuous and challenging. This has led some Members to seek a ``quick fix'' in an attempt to end the annual struggle. Biennial budgeting, however, is a mirage that distracts us from the real budget problems we face. Biennial budgeting would be an enormous change in our budget processes, the biggest since at least 1974. The effects on the budget struggle would be far-reaching and very largely negative from the Congressional perspective. Biennial budgeting will deprive Congress of much of the leverage it needs to compete equally with the administration. Specifically, Congress gives up. Reconciliation in off years. The Congressional majority could lose much of its power in election years to use reconciliation. This will endanger its priorities in election years and would rule over the House tax cut strategy for this year. Congress could include multiple reconciliation instructions in a biennial budget resolution, but this deprives Congress of flexibility needed to react to changing political and economic needs. The majority would have to fashion its political strategy for the next two years just three months after the preceding election. Control over the agencies. The annual budget process allows Congress to express its will to government agencies. I know that we were more eager to cooperate with Congress at budget time when I was a member of the Nixon administration. Biennial budgeting will reduce our leverage to hold agencies accountable and encourage defiance. Budget accuracy and flexibility. Economic forecasting is highly uncertain. The Congressional Budget Office estimate for fiscal 2000 two years ago was for a $70 billion unified budget deficit. That's $240 billion off the current fiscal 2000 estimate of a $170 billion unified budget surplus. The estimate has shifted by $40 billion just since October 1999. This uncertainty means, the President would bargain for high second-year spending, and we would frequently need or be tempted to reopen the budget. When we reopen the budget, we would find ourselves with little leverage against a pre- funded administration that can resist unwanted budget modification with near impunity. When revenue is lower or spending is higher than projected, the pressure to increase fees, taxes and borrowing, rather than cut the administration, would be considerable. Leverage over spending. Congress will inevitably grapple with supplemental spending requests in the off years. In the absence of pressure to produce a complete budget, an administration will always have poll-tested and politically motivated requests in off years that will be hard to fend off in the absence of broader budget issues. As a result, we will pass supplemental appropriations bills in most years that will grow as Members add their own pet election-year projects. All of this threatens even the very modest spending restraint that we've been able to exercise over the last five years. I find it surprising, then, to hear of growing support for moving from our current annual budget to a biennial budget process. It does seem sometimes that we are on a budget treadmill that never stops. There is no solution, however, in ducking our responsibilities to exercise the power the Constitution grants us. Power atrophies unless it is used, and that is what will surely continue to happen to Congressional power if we adopt biennial budgeting. Members interested in getting a handle on the budget should focus on substance rather than process. The truth is that the discretionary potion of the budget--which is the substance of the 13 annual appropriations bills--makes up just one-third of total federal spending. The rest of our spending--chiefly, entitlement programs--is on automatic pilot and rising faster than inflation. This growth in entitlement spending puts enormous pressure on the other parts of the budget and will inevitably necessitate higher taxes or a return to excessive government borrowing. Acting promptly and boldly will bring benefits as well. The unremarked secret of our current budget surplus is the welfare reforms enacted in 1996 and the Medicare changes enacted in 1997. To be blunt, we would still be in deficit without these reforms. But in both cases, one could also argue that the programs have been strengthened. I have long believed that there are similar opportunities to improve our largest entitlement, Social Security, which is now 23 percent of total federal spending. As chairman of the Budget Committee Task Force on Social Security, I helped develop 18 unanimous and bipartisan findings that could serve as the basis for reform. After the completion of the task force's business, I also introduced the bipartisan Social Security Solvency Act (H.R. 3206), which is scored to keep Social Security solvent based on these findings. The effect of this reform (or of similar reforms such as the 21st Century Retirement Act (H.R. 1793)) would be to dramatically reduce the growth of government spending for decades to come. The charts on this page show how significant reform can be. The first chart shows that federal spending will rise to nearly 35 percent of the nation's gross domestic product without changes in our entitlement programs, about 75 percent higher than it is today. Needless to say, giant tax increases will be needed to sustain this level of spending. In contrast, the second chart shows what could happen if we simply adopt the Social Security Solvency Act. Under this scenario, we would experience a gradual reduction in federal spending as we shift to a retirement system based partly on worker-owned accounts starting at 2.5 percent of income and partly on traditional government-paid benefits. This legislation would also fully restore the program's shaky finances and create opportunities for workers to live better in retirement by making full use of the power of compound interest. This is not easy work. But if we do nothing, taxes will have to rise to the equivalent of 40 percent of payroll by 2040 to pay for Social Security, Medicare and Medicaid. Social Security and our other entitlement programs are complicated and alteration carries political risk. The benefits from this effort, however, will also be substantial. Sound reforms will allow Congress to master the federal budget where gimmicky process reforms such as biennial budgeting are bound to fail. Madam Speaker, what we are faced with in this country is an expanding cost of Social Security and Medicare. The two greatest challenges that the United States faces is the increased cost of the entitlement programs. We have played around for the last 5 years desperately trying to reduce the expansion and increase of discretionary programs. But the entitlement programs account for almost two-thirds of Federal spending. One-third of Federal spending, the 13 appropriation bills that we agonize, that we argue, that we debate for almost 8 months of the year, only account for one-third of total Federal spending. We have been successful in starting to slow down the increase in that expending. So some years, in fact, it has been less than inflation. Generally, it is about inflation. But the challenges that we are facing with Social Security and Medicaid are the hugest challenges we can say for future taxpayers. Because if we do not do something, Madam Speaker, if we do not force ourselves to deal with these kind of problems, because of the fact that life spans are increasing dramatically and because of the fact that the birth rate has substantially been reduced in the last 50 years, that means that fewer young people, fewer workers in this country are asked to pay a higher FICA tax to support the senior program. The actuaries give an estimate that, if we are to continue the programs as they exist today, within 40 years, our payroll tax, our FICA tax, will be approximately 40 percent. Right now it is 15.3 percent. That is our FICA tax for senior programs. Some people say, well, that would be unreasonable; that cannot happen. All we have to do is look at what is happening in countries around the world. Czechoslovakia, Japan, other countries in Europe are approaching already 40 percent payroll tax to support their senior program. The country of France has an effective payroll charge, a payroll deduction, of 70 percent of what each worker in France earns to support their senior program. I mean, it is no wonder that France has such a tough time competing. If we allow our entitlement programs to go on the way they are without some modification, without some change, without greater priority to use the surpluses for those programs, but we cannot do it with the surpluses alone, put all of the $4 trillion surpluses that we expect over the next 10 years and it will be less than half enough to pay for the unfunded liability of Social Security alone, let alone Medicare and Medicaid. I just cannot urge my colleagues enough or the American people to look at the consequences of what is going to happen if we do not deal with these important programs. Number one, Social Security probably is the most successful program that we have in terms of making sure our senior population does not live out the remainder years of their lives in poverty. So I think we cannot afford to let it go by the wayside. Neither can we afford to put off the decision. The longer we put off the decision on Social Security, the greater and more drastic the changes are going to have to be. We should have done it 4 years ago. We should have done it 6 years ago. How do we develop the leadership in the United States to make the tough decisions that need to be made to change these programs? I mean, I appreciate the political vulnerability that any politician goes through if they suggest change in a popular program. We have approximately 12 percent of our seniors that depend almost entirely just on their Social Security check. I urge my colleagues to read this article in Roll Call. I ask my colleagues and the President of the United States to be more aggressive coming forward with programs and proposals that can be scored to keep Social Security solvent for at least the next 75 years.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. I yield to the gentleman from Wisconsin.