Nick Smith

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Chairman, I would conclude by requesting the support of my colleagues in the passage of this amendment.

Mr. SMITH of Michigan. Mr. Chairman, first, I would thank the gentleman from Wisconsin (Chairman Sensenbrenner) and the gentleman from Texas (Mr. Hall), who have done such great service to further the efforts of science and research in this country. I would also compliment the ranking member of the Subcommittee on Basic Research, the gentlewoman from Texas (Ms. Eddie Bernice Johnson). This legislation I think gives the emphasis needed to move us ahead in information technology, and certainly we should remind ourselves that information technology research has been instrumental in bringing about the information revolution, which some have compared to the industrial revolution in its size and in its scope. This revolution has spawned new businesses, created millions of good high-paying jobs, advanced the sciences, and certainly improved the health and welfare of the citizens of the country and people all over the world. However, as the President's Information Technology Advisory Committee recently noted, the current boom in information technology is based on the basic research in computer science carried out more than 15 years ago. There is an urgent need to replenish the knowledge base. The advisory committee advocated a 5-year initiative to boost basic research funding significantly and help maintain the Nation's lead in this critical area. This bill, H.R. 2086, was designed to carry through on PITAC's recommendations. In testimony before the Subcommittee on Basic Research last year, university researchers and members of the private sector were very supportive. Dr. Lazowska, a professor at the University of Washington and chair of the Computer Research Association, praised this bill, saying that it exemplifies a sound approach to making research policy by responding to clear national needs with recognizable objectives and a well-defined program for meeting those objectives. In addition, Dr. Roberta Katz, president and CEO of the Technology Network, noted favorably that the 5-year authorizations in the bill demonstrate a commitment to a continued strong Federal investment in basic IT research to move information technology ahead. In today's fast-paced science and technology environment, resting on our past successes is not enough if we are going to keep ahead in a world where other countries are dedicated to matching our productivity and taking away our customers. H.R. 2086 will help ensure that America stays at the cutting edge of new information technologies that will stimulate economic growth, improve our lives, and push forward the frontiers of science. I am pleased to have been a cosponsor of this bill, because it is this kind of initiative that is going to help assure a good future for the citizens of the United States.

Mr. SMITH of Michigan. Mr. Chairman, I offer an amendment.

Mr. SMITH of Michigan. Mr. Chairman, this amendment would have been put on yesterday by our Committee on Science meeting except it would have involved the possibility of re-referral to the Subcommittee on Research and Development. With the consent of Mr. Young as well as the chairman of the Subcommittee on Energy and Mineral Resources, and also the gentlewoman from Wyoming (Mrs. Cubin) gave her support, we are offering this amendment at this time. This amendment would allow the United States Geological Survey to participate in the Networking and Information Technology Research and Development Grant Program established by this bill. In doing so, the USGS would join with the National Science Foundation and other participating agencies in helping focus government funding on information technology research. The United States Geological Survey has a simple mission, to describe and understand the Earth. When I was young, I traveled around the country with my dad who was a topographic engineer with the USGS. Dad helped meet the challenge of mapping this country by taking to the field with the old fashioned rod and compass in hand. Today, the topographic maps my father helped create are digitized and the data they contain augmented by readings from satellites, sensors buried in the ground, and experiments run in the lab. Today, the current shuttle radar topography mission to map the world is in its 5th day of sending back billions of bytes of data. The USGS has spent the last 121 years building a collection of these maps, images, and other information assets as a way of answering some of our fundamental questions about the Earth and its processes. These assets now include extremely large data sets requiring extraordinary technology challenges to maintain and use. That is why this amendment is important. It is difficult to get a grasp on the size of the challenge without resorting to an analogy. For example, the USGS information assets include petabyte size data sets. A petabyte is 2 to the 50th power bytes, one million gigabytes, a thousand trillion bytes, a number that even someone used to dealing with the Federal budget has a hard time understanding. To describe the vastness of this information in another way, these databases are the equivalent of 20 million four-drawer legal-sized filing cabinets stuffed full of text. The computers and processors that deal with these data sets must be correspondingly capable and the network connections that feed them must be adequately quick. The USGS continues to research these technologies as part of their research agenda. Allowing them to partner in the research funded under this bill will help ensure that their technology needs are met. It will also allow them to bring their considerable skills to the table and help focus this research into the areas where it is sure to do the most good. I should point out, Mr. Chairman, that this amendment does not authorize any new funding. This simply recognizes the USGS in its role as a participant in IT research. I am pleased to offer this amendment with the support of the gentleman from Wisconsin (Mr. Sensenbrenner) the chairman of the Committee on Science and the approval of the gentleman from Alaska (Mr. Young) the chairman of the Committee on Resources and the gentlewoman from Wyoming (Mrs. Cubin) the chairman of that committee's Subcommittee on Energy and Mineral Resources.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, we have heard a lot about the talk on paying down the debt, and I think it is very important that American citizens understand some of the terminology that is used here in Washington. This chart represents what would happen to the total public debt. The total public debt of this country right now is $5.7 trillion. That includes the debt that we owe the Social Security Trust Fund and the debt that we owe Wall Street or the debt held by the public, plus the debt held by the other trust funds. I think this represents the potential good news of paying down that debt if we were to stick with the caps, the budget caps that we set in 1997, but that is not going to happen. Yesterday in the Committee on the Budget, we heard the director of OMB say that those caps are unrealistic and presented the President's budget. The President's budget, by the way, increases taxes and fees over the next 10 years by something around $250 billion. Next year alone, his tax increase is $9 billion. So he is expanding spending for a lot of people and a lot of programs with approximately 80 new programs and a considerable extension and expansion of another 155 programs. So those increased taxes and fees are what is paying for a significant increase in the size of the Federal Government. He is able to say that he is going to pay down what he calls the debt of this country. But I think what we should be very careful in understanding is that what he is talking about paying down is the debt held by the public. The bottom portion of this chart represents the debt held by the public, starting now in the year 2000, and what is going to happen over the next 10 years. The middle portion is approximately 112 trust funds that we borrow from in addition to Social Security. That is the Medicare trust fund, the Medicaid trust fund, the transportation, highways and all of the other trust funds. The top trust fund of course is what we have been concentrating on, and that is the Social Security Trust Fund. So when it is suggested that we pay down the debt of this country, what we are talking about is that portion of the total Federal debt, approximately $3.6 trillion; but the way we pay it down is when the cash dollars come in from the Social Security tax, there is more money coming in right now from that withholding tax than is needed to pay out current benefits. So what is being suggested is we use those dollars, we take the cash dollars from Social Security, we borrow it, we write an IOU, and we use those dollars to pay down the debt by the public. However, what happens to the total Federal debt of this country is the debt continues to increase. So we are looking at down the road in the next 10 to 15 years of having the current debt go way over $6 trillion, even if we were to stick with the caps. Here is why I think it is so very important. It is not just the debt and it is not just paying down the debt but it is the structure of our entitlement programs that are going to be very, very difficult for our kids and our grandkids to pay off. Right now the FICA tax, the withholding tax on payroll is 15 percent of taxable wages. Right now, approximately 75 percent of the workers in this country pay more in that FICA tax, that payroll withholding tax than they do in the income tax. If we do nothing, within the next foreseeable future, our payroll tax will have to go to 40 percent of payroll if we do not fix these programs of Social Security and Medicare, 40 percent of payroll. Then we add income taxes on that for all of the rest of the Federal programs, we add another 20 percent of pay that goes to State and local government; enormous taxes are there, and the potential is a huge disadvantage for the ability of this country to stay competitive with the rest of the world. Some people say well, can this happen. All we have to do is look at Europe, look at Japan. Already many of those countries are 40 percent. In France, the effective payroll withholding in France is now 70 percent. I mean it is no wonder they have a tough time competing. If we do not do anything in America, we are headed down that same road. That is why looking at entitlement, that is why I am disappointed that Steve Forbes has withdrawn from the race, because he is one of the few candidates that laid out a precise, exact solution of what he thought was the way to go to keep Social Security solvent, to keep Medicare solvent and still have the choice of doctors. Madam Speaker, I think as we move ahead this year, and moving ahead with this budget, I think we need to challenge ourselves very aggressively to looking at the problems of entitlements, because that is going to be the huge challenge of America and this government in the future.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, early this morning the Steve Forbes campaign called me and said that Steve Forbes' wife flew into Michigan late last night; and sometime between 12 p.m. and 5 a.m. this morning, the family made its decision that he would be withdrawing from the presidential race. As one of the Michigan cochairmen for Steve Forbes, I was disappointed, because what Steve Forbes brought to the podium, to public discussion, was detailed plans on where this country goes, where we go, in terms of fixing Social Security, where we go in terms of fixing Medicare, both insolvent. In my 5-minute speech today under Special Orders, I will be talking about what could happen on paying down the debt, but probably that it is not going to happen, and that what is really going to happen is a tremendous burden on our kids and our grandkids if we do not wake up, if we do not pay attention, if we do not come out with some of the solutions to make sure that we keep these important entitlement programs solvent.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I bring this chart because I think if we do nothing else, we should be up front, very honest. We should not continue to hoodwink the American people in talking about reducing the debt of this country. I bring this chart, the total debt of this country is $5.72 trillion. I divide it in three segments: The Social Security debt, which is now about a trillion; the other trust fund debts are about a $1.1 trillion; and the debt held by Wall Street or the debt held by the public is now $3.6 trillion. What we are doing, when we are saying everybody in Washington says we are paying down the debt, we are borrowing from Social Security; that is why the Social Security debt gets bigger. Mr. Speaker, we are using those dollars borrowed from the Social Security trust fund to pay down the Wall Street debt, so the net total debt, subject to the debt limit, the total debt of this country that we are passing on to our kids continues to go up. Let us be honest about it. Let us try to achieve a real balanced budget, and that means the total debt of this country does not continue to rise.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Madam Speaker, I would like to talk a minute about the challenge facing this Congress as we develop next years new budget. Part of the question is, are we really going to pay down the debt, and do we really have a balanced budget. The answer is no on both counts. As Members will notice this chart, I have divided our debt into three segments, because there is a great deal of confusion in terms of what our debt really is. Are we really paying down the debt? We hear the candidates running in this first primary today in New Hampshire talking about the importance of paying down the debt. Madam Speaker, the total debt of this country is now $5.72 trillion. This $5.72 trillion I have divided up into three categories. One is what I call the Wall Street debt, or the debt held by the public. That is approximately $3.6 trillion. The other portion of the debt is the social security surplus about $1 trillion. Right now, because we are overtaxing American workers, we are bringing in about $153 billion this year more in social security taxes than is required for the payment of current benefits. For the last 40 years we have been using that extra social security surplus to fund on other government programs. The middle portion of this chart represents what we have borrowed from the other 112 trust funds. Madam Speaker, I think it is so important that we not, if you will, hoodwink or mislead the American people that we are paying down the debt of the country when we really are not. As Members will see by this chart, the total debt continues to increase. This continued increase in debt is if we have a freeze, and continue to only spend at last year's spending level. Of course, last year we added another $20 billion of emergency spending. So if we add that spending to what we already spent last year and we froze at that level for that next 5 years, then we are going to continue to increase the national debt. We talk about the words ``balanced budget.'' Do Members not think it would be reasonable to define a balanced budget as a spending level when the total debt of the country does not continue to increase? I think it would. I am a farmer. On the farm, a lot of us try to pay off the mortgage so our kids have a little better life, have a little better chance of making it, so we try to pay down the mortgage so their life does not have the kind of sacrifices that some of us went through. But in this Congress, we are going just the other way. We are adding to the mortgage of the country, and we are asking our kids and our grandkids to sacrifice their living standards because we think our needs today are so great we should overindulge or overspend now. Let us start really balancing the budget. Let us stop borrowing from the 112 trust funds for other government spending. On the top of this chart we see social security trust funds. That is the largest surplus we have coming from any of the trust funds. But then there is the Medicare trust fund and the others 111 trust funds. In the gray portion in the middle of this chart, we have represented another 112 trust funds we are borrowing from. Without that borrowing, we do not have a balanced budget. Let me show Members this other chart. If we stick to our budget caps, this chart represents how we can pay down the Federal debt. It does not start to go actually down until 2003, but at least it starts to go down. Let me suggest to Members and the President that increasing spending is not good public policy. I see keeping solvent both social security and Medicare a huge challenge. The actuaries at the Social Security Administration estimate that over the next 75 years, over the next 75 years, there will be $120 trillion less coming in from the social security tax than is needed to pay benefits. Let me say that again. The social security actuaries at the Social Security Administration estimate that we are going to need $120 trillion more than what is expected to come in from the 12.4 percent social security tax over the next 75 years to pay the benefits that we have promised; a tremendous challenge in social security, a tremendous challenge of keeping solvent the Medicare program. I think we have to be very careful about implementing what the President has suggested on increased spending. We cannot continue to expand the size of this government, to increase spending. Let us start solving the problems of social security, Medicare, and start paying down the debt. Madam Speaker, during good times, it is reasonable, whether you are a family or a government, to have a rainy day fund. A rainy day fund for a government that owes $5.7 trillion is starting to pay down that debt. I ask my colleagues to resist the political temptation to increase spending.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I rise today to suggest that today is an important day up in the New England States. We are looking at the presidential candidates speaking before many listening groups, trying to express what the best course for our future is going to be. I hope the American people understand, Mr. Speaker, the consequences of fiscal irresponsibility in the United States Government. I bring this chart to demonstrate that we are approaching a fiscal challenge trying to make the decision whether we will start paying down the federal debt or simply continue to spend more. The national debt of the United States, which is the debt subject to the debt limit continues to increase. Right now Congress has passed a budget for this year demanding we not borrow more money from Social Security and spend it on other programs. That's good! However, we still won't have a real balanced budget because we are spending $70 billion borrowed from the other 112 trust funds. Right now our public debt as defined in law is $5.72 trillion. If we stick to the budget caps that we set in 1997, by 2002 we could have a real balanced budget that does not use the surplus from any of the trust funds. We would start paying down the total public debt. Wait a minute, you say, I heard on T.V. that we already have a balanced budget and that Washington is paying off the public debt, and we can do that in 12 or 13 or 15 years. That is not correct. It is dangerous ground because there is a certain degree of dishonesty that is going on, trying to tell the American people that we are paying down the public debt when we are not. There is a certain amount of hoodwinking in suggesting that we really have a balanced budget when we do not. It seems reasonable that we could define a balanced budget as a budget when the total public debt does not continue to increase. Let me suggest that during the good times it is reasonable to start having a rainy day fund. But a rainy day fund for a government that now owes $5.72 trillion is starting to pay down that debt. I am a farmer from Michigan. We have always felt that one of our goals would be to try to pay off the mortgage or at least pay down the mortgage so there is a smaller debt load when we pass that farm on to our kids. But here at the Federal Government level we are doing just the opposite. We continue to increase that debt load that future generations are going to have to pay off one way or the other. Allow me to review the last several years of the federal budget. When Republicans took the majority in 1995, there was a deficit, or overspending, every year between $200 billion to $300 billion. Well, the good news is we have come a long ways. This year, for the first time, we are at least going to have a balanced budget without using the Social Security surplus. That is the good news. We have turned the corner. We have started slowing down the growth of government. Here is the bad news. The total public debt is continuing to increase. There are 112 trust funds that the government has. In most of those trust funds we overtax or have higher fees so that there is more money coming into those trust funds than is needed to pay out the particular benefits or expenses in any one particular year right now. So what do we do with that extra money? What government has done and continues to do with that extra money is to spend it for other government programs and write out an IOU to those trust funds. The biggest trust fund is Social Security. We are looking at a surplus, or what is really overtaxation of the payroll tax, to bring in approximately $153 billion more than what is needed to pay Social Security benefits this year. The other big trust fund, of course, is the Medicare, civil service pension, military retirement and other trust funds. These 112 other trust funds will bring in an extra $60 billion. So we are using all that extra money and spending it for other programs and writing an IOU. So what does government do when those trust funds start needing more money than is coming in from those taxes? We do one of three things: first, we cut out other spending. That is pretty unlikely. We have never been able to do that. We have continued to expand the size of government. Second, we increase taxes. And we have done that all the time. Or we increase borrowing and of course Washington has been doing a lot of that. I say let us be honest with the American people. Let us hold the line on spending and let us really start paying down this debt. Thank you.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, all the Presidential Republican candidates and Democrats are campaigning today for the Nation's first elections tomorrow. I would like to talk, Mr. Speaker, about what is happening with our national debt. The public debt of the United States that technically every citizen now or our kids and our grandkids eventually are going to have to pay off. Mr. Speaker, I hope every one of those candidates realizes that this talk about paying down the public debt is somewhat of an untruthful presentation of what is happening with the public debt of this country. The way we do our bookkeeping here in Washington is sometimes confusing and unquestionably very complicated. But what we have right now is a public debt, as defined in law of $5.72 trillion, $5.72 trillion, approaching $6 trillion. We made some good decisions this past year to not spend any of the Social Security surplus for other government spending. Excellent start. Excellent beginning. But still, our total national debt continues to increase. Why is the total debt of this country continuing to increase as we brag, and that is Republicans, Democrats, the President, brag that we are balancing the budget and paying down the Federal debt? Here is why. We have about 112 trust funds. The largest, of course, is the Social Security Trust Fund. But we are borrowing from all of these other trust funds also. The Civil Service Retirement Trust Fund, the Highway Trust Fund, the Airport Trust Fund, the Medicare Trust Fund. From all of these trust funds we are taking the extra money, because we have charged additional taxes more and above what is needed in any particular one year of spending. Now, we are using that money for other government spending. I am introducing legislation that says let us lower the total debt subject to the debt limit that Congress has to pass and the President has to sign. Let us lower that debt to where it will be at the end of this fiscal year next October 1, and then let us stick to it. Let us make sure that we have the kind of freeze that is going to take the burden off of our kids and our grandkids so that they are not going to end up having to pay for what we consider is very important spending this year. Mr. Speaker, I am a senior member of the Committee on the Budget. This week we are holding what are called listening sessions, talking about what the Members are willing to do in terms of holding the line on spending. I am a very strong advocate, and I will encourage at our meetings tomorrow, this week and next week, that we have spending caps for the kind of spending discipline that it allows us. We have come a long ways. When I first came to Congress in 1993, the projected deficit, in addition to what we were borrowing from Social Security, was over $200 billion a year. Now, at least, we have balanced the budget in terms of Social Security spending, and that is the largest amount. There will be approximately $120 billion or $130 billion more money coming in from Social Security taxes than we need in any one year, so somehow we should be starting to talk about how do we reduce that burden on working men and women of America; and how do we save Social Security in the long run? It is a huge challenge. We talk about millions and billions and trillions. But, Mr. Speaker, if anybody can conceive what a trillion dollars is, let me just give what is going to be required to pay out Social Security benefits over the next 75 years over and above what we are going to collect in Social Security taxes. Over and above what we are going to collect in Social Security taxes over the next 75 years, it is going to take $120 trillion more money. That has got to either come from increased borrowing, increased taxes, because I suspect the way we have been going in Congress it is not going to be coming from reduced spending in other areas. There are huge challenges before us. Mr. Speaker, I am a farmer. What we do on the farm is we try to pay off the farm so that our kids do not have to pay off that mortgage. In this country we are continuing to increase the debt to give a bigger mortgage to our kids and our grandkids. Let us turn that around. Let us have the presidential candidates start talking about the seriousness of saving Medicare and saving Social Security and paying down this huge public debt that is facing this country.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, it is important that the American people understand tonight, when we will hear the President brag about a balanced budget and paying off the debt, what is really involved. For the American people to understand that, the press has got to start understanding what a balanced budget is and the fact that our total debt of this country, the public debt of this country, is going up every year. The suggestion is that we simply increase our borrowing from Social Security to reduce the so-called Wall Street debt. The current debt to this country, as defined in law, is $5.72 trillion. It is important that everybody understand we are not going to have a real balanced budget until the total debt of this country does not continue to increase.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, just as a follow-up to the previous speaker, I wish everybody, Mr. Speaker, could read the editorial in the Wall Street Journal today. It conveyed the message that part of the reason this economy is doing so well is Congress is staying out of its way. And yet some people say, let us pass more legislation. Let us do more things, increase taxes, make it tougher for business to succeed and end up increasing the tax revenues that come to this government. We have been working at this budget for the last 9 months. Now we are saying after all of the gives and takes, the compromising here is our best effort level of spending prorated among different programs. Now we have calculated that in order to save the Social Security surplus, we need to cut about 1 cent out of every dollar that is now proposed to be spent across the board for discretionary programs. Not leaving it up to the President to cut Republican programs, not leaving it up to the Republicans to cut Democrat programs. Mr. Speaker, an across-the-board cut is reasonable. Let us do it and get on with this budget and let us have a new beginning to save Social Security.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, do I not have the right to ask unanimous consent for 1 minute prior to proceeding with the 5 minutes speeches?

Mr. SMITH of Michigan. Mr. Speaker, point of order.

Mr. SMITH of Michigan. But, Mr. Speaker, I only want 1 minute.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I want to talk about Social Security. We have heard a lot of talk about it. The President 2 years ago in his State of the Union message said, let us start putting Social Security first. Republicans have said that and Democrats have said that. So we are doing a lot of talking but we are not doing a great deal of putting Social Security first. We have taken maybe a giant step in the conviction of the Republicans not to spend the Social Security surplus, and so we have made a decision that despite the fact that there are more revenues coming into the Federal Government than we have seen for a long, long time, and the revenues coming in are both what is called on budget, which means the income tax and all other revenues except for the Social Security tax, and Social Security tax is now 12.4 percent of most of what everybody makes, what is happening is it is a pay-as-you-go program. Social Security gets their Social Security, the FICA tax, the payroll tax, money in every week and almost immediately it is sent out in benefits. Since we dramatically increased the Social Security tax in 1983, there is a little more Social Security tax coming in than there is required to pay current benefits. That is what is called the Social Security surplus, and what Republicans decided several months ago is that we were going to hold the line on the budget not to spend the Social Security surplus for other government programs and instead use that money to pay down what I call the Wall Street debt or the debt held by the public. I have introduced a Social Security bill every year since I have been in Congress, every session since I have been in Congress since 1993. I just introduced the most recent improved Social Security bill last month, and it was based on our task force report, our bipartisan task force report, where Republicans and Democrats came together to agree on the findings. The bill I introduced reflects these findings. Let me briefly go over this chart. Number one, it allows workers to invest a portion of their Social Security tax. It starts at 2.5 percent of your taxable payroll. That is now $76,000. Over the years, it increases. It can only be used for retirement but it is in the worker's name so that politicians in Washington cannot steal it like they have in the past. In 1997, when Social Security money was short, we passed a law that says we are going to reduce benefits and increase taxes. Again in 1983, when Social Security revenues were short of the requirement for benefits, we increased taxes and cut benefits. Let us not do that again. This bill does not increase taxes. Seventy-two percent of all the workers in the United States now pay more in the Social Security tax than they do in the income tax. Let us not increase taxes. It repeals the Social Security earnings test so senior citizens, if they want to work, do not have their Social Security check reduced for the amount they work. That needs to be changed to allow seniors to work if they want to. It gives workers the choice to retire as early as 59\1/2\ years old and start taking their personal retirement savings account out. We also have a provision that encourages individuals, if they want to wait until they are 70, it substantially increases their benefits by 8 percentage points for every year that they delay taking their Social Security check. In other words, if they delay 3 years, it is a 24 percent increase in what they would otherwise get. One year would be 8 percent; 2 years 16 percent. It gives each spouse equal shares of the personal retirement savings account and increases widow and widower benefits up to 110 percent. As I met with widows and widowers, they said, look, you are dramatically taking so much of the Social Security check away when one of the spouses die that we cannot afford to live in our home anymore. So we increased that up to 110 percent of the maximum benefit they were getting. It reinforces the safety net for low income and disabled workers. It passes the Social Security Administration's 75-year solvency test. In fact, the economists suggest that if we were able to put this bill into law, it would keep Social Security solvent forever. It is not going to reduce the existing benefits for current retirees or near-term retirees. It is something we need to look at if we are serious about saving Social Security. The time has passed for just talking and rhetoric. Let us do something about it. Mr. Speaker, I hope that every American voting next year will be asking their candidates for the President and the Congress what their plan is to save Social Security and really put it first.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, a very brief comment regarding our future on social security. We have approximately eight proposals now introduced that have been scored by the Social Security Administration to keep social security solvent for at least the next 75 years. As we move forward in these last several days, and as we break for the rest of November and into December, I would suggest very strongly that each Member of the Congress meet with the people back home, talk to them about the importance of social security, about the complications of solving social security, and about our efforts to have a good beginning by not spending the social security surplus. To accommodate $9 trillion of unfunded liability, $9 trillion that needs to be accommodated in order to keep social security going, it is very important that these discussions continue.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, somehow, sometime, some place we are going to have to get over this partisan bickering and start working together on serious problems facing this nation. Yesterday I introduced a bipartisan bill that keeps Social Security solvent. In trying to convey the seriousness of the Social Security problem, I said that in the next 75 years the taxes coming in from Social Security are going to be short $120 trillion from accommodating what we have promised in benefits; $120 trillion over Social Security taxes collected over the next 75 years. My wife Bonnie said, Nick, nobody understands what a trillion is. How else can we convey the seriousness? So, here is a quick try. A worker's income will be less if we don't solve Social Security. Poland has just exceeded 48 percent of their payroll tax for senior citizens. France is over 70 percent for their payroll tax. That means the cost of production goes up and fewer sales and less employment. We have created less take home pay, more jobs in the U.S. in the first quarter of this year than Poland and France have in those two countries combined since 1980. Our pay roll tax is heading in that direction. Let's fix Social Security.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, this morning at 11 a.m. I will be holding a press conference announcing a new social security bill that will keep social security solvent forever. That press conference at 11 a.m. this morning is going to be held at the triangle southeast of the steps. If it rains or snows it will be in room 210, the Committee on the Budget room. I announce this, Mr. Speaker, because I notice some publications noted that it was going to be in the press gallery. It is going to be at the triangle. The reason for the change is about a dozen organizations will be present that have agreed to support my bill. I would just encourage, Mr. Speaker, everybody in this Chamber to decide what legislation, scored by the Social Security Administration keeps Social Security solvent, they support. There are several such bills already introduced, or come up with your own bill as long as it is scored by the Social Security Administration to make this important program solvent. I think time has gone for rhetoric. We need action to support and move ahead with legislation that is going to keep social security solvent.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I come to the well of the House today with what I consider good news but also maybe some bad news, a little bit sweet and a little bit sour. The good news is that there is a great deal more attention to the serious problem of saving Social Security. The bad news is that we are not doing too much about it. I was disappointed when the President sent over his proposed legislation that in effect says, let us add another IOU promissory note to the Social Security Trust Fund. An IOU is, of course, a promise to pay in the future. And that is what this would do is say, somehow, some way, raising revenues from some source down in future years, Congress will come up with the money to keep Social Security going for a little while longer. Let me, Mr. Speaker, just give a little background on Social Security. It was started in 1935. It was a program then and always has been a pay-as-you-go program. In other words, existing current workers were asked to pay a Social Security tax. That tax came in and was immediately sent out to senior citizens, retirees, beneficiaries. So today the money comes in one day and by the end of the week it is sent out in benefit payments. Right now we are bringing a little more in because we have substantially increased the FICA tax, the Social Security tax; we are bringing a little bit more money in than is needed to pay benefits. That is what is called the Social Security Trust Fund. And that is what Republicans, the Democrats and the President have been arguing about, should we continue spending that Social Security Trust Fund money for other government programs. I think now most of us agree, no, that we should not. And the challenge is how do we calm the desire of the President and some of the spenders in this body that would like to spend more money and yet not spend the Social Security Trust Fund reserve. That, however, not spending that Social Security trust fund, does not solve Social Security. The trust fund, the IOUs in the trust fund, the money the government has borrowed in the past, now accounts for approximately $800 billion. But when we consider that benefit payments are $400 billion a year, that trust fund reserve would not even hardly last the full of 2 years. The actuaries at Social Security and the CBO, the Congressional Budget Office, estimate that the unfunded liability, I will go into detail on those words, but the unfunded liability of Social Security is $9 trillion. In other words, if we were to hire a private firm and say we want you to continue paying Social Security benefits indefinitely, they would say, okay, you have got to give us the right to tax all workers 12.4 percent of their taxable payroll, plus you have got to give us $9 trillion today to put in an interest- bearing account so that that will be the only way that we will take on as a private sector industry the responsibility of paying Social Security benefits in the future. $9 trillion. Compare that with our annual budget in this country of $1.7 trillion. It means that we have got a long ways to go. It means that Social Security is not solvent and cannot continue the way it is currently structured. So back to the good news. The good news is there is more attention to it. I say hurrah to the President for the last two State of the Union speeches, saying let us put Social Security first and so the Republican leadership, the Democrats, all of us in Congress have said, good idea, let us put Social Security first but we have not done it yet. We have not come up with the kind of proposals that are going to keep Social Security solvent. Next Wednesday at 11 a.m. in room 210, Mr. Speaker, I will be announcing my Social Security bill that does just that. It keeps Social Security solvent into the future. It is not easy. To pretend that somehow the Social Security trust fund and the promise that government has made that it will somehow pay that trust fund money back is going to save Social Security is not true. It is not right. It will not work. Somehow, we have got to increase benefits for widows and widowers that are asked to substantially reduce their money coming in from Social Security as they try to survive. I think we are challenged with a situation that Congress does not usually react and do something unless the people of this country demand that something be done. That has not happened yet. There needs to be better information. There needs to be more understanding that at risk are future generations and current retirees if we do not step up to the plate and solve Social Security now.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I am going to try to give a quick 1-minute summary. For the 40 years before the Republicans took the majority in this House, spending of the United States Government increased faster than inflation every year. Now we are starting to bring that spending increase down, and we have balanced the budget without using Social Security money for the first time in 40 years this year. Despite the fact that we have reduced discretionary spending as a percent of GDP for the past five years we are still using 20.8 percent of the gross domestic product of this country in spending and running this Federal Government, the highest spending in history, the highest rate of taxation in history. Now we are asking departments just to try to hold the line, to increase efficiency, to get rid of some waste and some fraud and some abuse in their spending. You have heard the figure one percent. That is how much we need to reduce what is authorized. It is 0.8 percent of outlays, 0.8 percent reduction in what is now expected to be spent. We are saying to those administrators, directors, department heads, try to look at efficiencies to save 8 cents out of every $10. Correct and stop some of the fraud and abuse. Mr. Speaker, they can do it. Let us do it. Let us join together. Let us save Social Security.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, it is going to be sort of like a lesson plan. It is about Social Security. Next Wednesday at 11 a.m., a week from tomorrow, I will have a press conference on a Social Security bill that I am introducing that will keep Social Security solvent forever. I have been working on Social Security for the last 5 years, developing what I think is a reasonable proposal to keep Social Security solvent and protected. We are going to hear later tonight about the importance of not spending the Social Security surplus. A year ago last April, I was asked to chair a bipartisan task force on Social Security. At that time, most everybody thought that the Democrats and Republicans would not come to any agreement on what we should do about Social Security. But after 15 hearings with two or three or four witnesses per hearing, we became so convinced and, therefore, unified about how serious the problem of keeping Social Security solvent was and how important Social Security was to so many Americans that Republicans and Democrats came together and agreed on 18 findings. I just want to quickly go through these finding. I know it is sort of like a lesson plan, but if my colleagues have a mental attitude that this is going to tremendously affect their future retirement, the retirement of their kids, and the retirement of their parents, then bear with me on these 18 findings, because this is what I have patterned my new Social Security program after. I am going to start. ``Background Social Security is a universal program that has provided a safety net for Americans.'' One-third of seniors today depend on Social Security for 90 percent or more of their total retirement income. ``Time is the enemy of Social Security reform and we should move without delay.'' Time is the minimum because we are running out of money. It is expected that by 2012 to 2014 there is going to be less FICA tax coming in than is able to accommodate existing benefits at that time. The longer we put off not utilizing the surplus that is coming in for the next several years, the more drastic that solution is going to have to be. ``Change should be gradual to allow workers to adjust their retirement plans, and any change for current or near-term retirees should be minimal.'' And that is what we have been working on the last several weeks in my bill, and it will be a bipartisan bill with Democrats and Republicans sponsoring that bill. It will keep Social Security solvent not just for 75 years but forever. The next item we agreed on is, ``Social Security under the current structure is projected to become insolvent during the next 75 years.'' And that is the problem. That is why it is important not spending the surplus now, because it is going to be that much more difficult to pay that back to Social Security when the time comes. ``Any reform must consider the effects on all generations, genders and those currently receiving Social Security benefits.'' ``Solvency and reform are not necessarily tied together.'' ``No payroll tax increase.'' And again I remind my colleagues that this is Democrats and Republicans on this task force agreeing. ``Social Security surpluses should only be spent on Social Security.'' That is what we are fighting about here in Congress now. ``Social Security reform should encourage savings and overall economic growth.'' And that is why investing some of that money in the capital markets and how that might be best utilized is so important in how we develop a final plan. ``The Social Security Trust Fund is a secure, legal entity comprised of U.S. Treasury bonds backed by the full faith and credit of the U.S. Government.'' Listen to this, though. ``While the U.S. has never defaulted on any of its obligations, these bonds represent a claim on future Federal revenue. Such securities will have to be redeemed from funds outside of the Trust Fund.'' That means we either cut other spending, we increase taxes, or we reduce benefits. ``The current demographic projections may very well underestimate the future of life expectancy.'' We had testimony that within 25 years anybody that wanted to live to be 100 years old would have that option; within 40 years anybody that wanted to live to be 120 years old would have that option. Tremendous implications not only on Social Security but on everybody's retirement plans. And that is why we, in the bill we will be introducing, encourage additional savings. I am going through the rest of these very quickly. ``Guaranteed return securities and annuities can be used with personal accounts as part of an investment safety net.'' We have financial managers now that will guarantee investments in the stock market and guarantee that investors will not have a loss. ``A universal Social Security survivor and disability benefit program needs to be maintained.'' No changes in that part. ``Congress should consider paying for a portion of the disability benefits for certain workers that have only been working a short time.'' Again, our press conference will be next Wednesday at 11 a.m., a week from tomorrow. We hope all our colleagues will attend, Mr. Speaker. I think it is important that we look at the long-range solutions for Social Security.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, I rise in reluctant opposition to the Norwood-Dingell health insurance regulation legislation. I have listened to my colleagues and constituents to learn all I could before casting my vote. Although I am convinced that something needs to be done to redress a health insurance system that is out of balance, I have several concerns that could not be allayed. Norwood-Dingell properly expands the ability of patients to recover damages from health care plans in court. The current bar to recovery of any damages against a health plan is inappropriate. Those plans that act negligently or are found guilty of medical malpractice should be held accountable as any medical professional would be. Norwood-Dingell, however, would open the gates to these types of suits too broadly. Had the amendment in the nature of a substitute offered by Representative Houghton, the gentleman from New York, been adopted by the House, I would have voted for Norwood-Dingell on final passage. That common sense amendment would have ensured that employers and directors would not have to worry about liability except in very rare cases. Under the vague language of Norwood-Dingell, however, there is uncertainty. Uncertainty is always a breeding ground for lawsuits, and the result would be their employers willing to provide health care to working families. Had Mr. Houghton's substitute passed, the bill would have had all the protection and access provisions of the Norwood- Dingell bill, but lawsuits would have been limited in a reasonable way. I also support the same common sense limits on suits against doctors and other professionals that have forced malpractice insurance to skyrocket, doctors to practice ``defensive medicine'' and raise everyone's costs, forcing even insurance companies to raise prices and reduce quality of care. Doctors should not have any greater liability than insurance companies and they also need help redressing the balance of power that is now tilted too heavily towards insurance companies, which is why I am a cosponsor of legislation such as H.R. 1304, a bill that would allow doctors to come together when dealing with health insurers. In closing, Mr. Speaker, we need to do more to protect patients and give doctors the freedom to treat their patients using their sound medical judgment as the yardstick rather than an insurance company's bottom line. Still, there are now more Americans without health insurance than there were just a few short years ago and we need to make sure that we don't raise health care costs more than necessary. I would note that the Congressional Budget Office has not done a cost estimate of this bill as required by the Unfunded Mandates Act and that none of us really know how much costs will increase and how many of our constituents will lost their health coverage. Before passing a bill that will affect nearly every American, I think we owe it to them to find out.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, for those people that might be watching this session arguing between that side and this side, who think it is more important to save Social Security, really the news is so good, because if both sides can work together to make sure the President does not raid the Social Security trust fund, we are going to be so much better off. For 40 years, we have been spending the Social Security surplus for other government programs. When we did the ``Contract with America,'' we said we were going to balance the budget. We set the target date for 2002. Actually we accomplished it this past year that ended October 1. We balanced the budget without using the Social Security trust fund. So now that we have got both sides working together, let us do that. Let us not start criticizing that we are not spending enough money in these appropriation bills because what that means is you are spending the Social Security surplus. It is tough for politicians in Washington not to spend more money to do more good things for the people in this country simply because they are more apt to get reelected when they spend that money. Let us be frugal. Let us run our pocketbook and our checking account like everybody else.

Mr. SMITH of Michigan

Mr. SMITH of Michigan. Mr. Speaker, we have heard this morning individuals from the other side of the aisle criticize turning down the nuclear test ban treaty over in the Senate. I am disappointed that there was partisanship on the part of the Democrats, that all those Democrats in the Senate voted for that test ban treaty, despite the fact that six former Secretaries of Defense urged the Senate to vote it down, four former Secretaries of Energy urged the Senate to vote it down, four former CIA directors urged the Senate to turn it down; (that includes two of the directors in the CIA appointed by President Clinton, Jim Woolsey and John Deutch), two former national security advisers, urged the Senate to turn it down; four former chairmen of the Joint Chiefs of Staff, and former Secretary of State Henry Kissinger called the Senate saying it was going to tremendously jeopardize the security of this country if they voted for it. I think, Mr. Speaker, it is important that as we look at all this expert advice and all of the additional retired generals and admirals that have come forward urging a ``no'' vote, there is no question in my mind, we have done this country a security favor by turning down this particular test ban treaty. Good going, Senate Republicans, for doing what is right.