John Spratt

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I yield 1 minute to the gentleman from Mississippi (Mr. Taylor).

Mr. SPRATT. Mr. Speaker, I yield 1\1/4\ minutes to the gentlewoman from Pennsylvania (Ms. Schwartz).

Mr. SPRATT. Mr. Speaker, I yield 1 minute to the gentleman from Washington (Mr. Inslee). (Mr. INSLEE asked and was given permission to revise and extend his remarks.)

Mr. SPRATT. Mr. Speaker, I yield a minute to the gentlewoman from California (Mrs. Capps). (Mrs. CAPPS asked and was given permission to revise and extend her remarks.)

Mr. SPRATT. Mr. Speaker, before yielding to the gentlewoman from California (Mrs. Capps), I yield 30 seconds to the gentleman from Texas (Mr. Edwards) to respond to the last speaker.

Mr. SPRATT. Mr. Speaker, I yield a minute to the gentleman from Wisconsin (Mr. Kind).

Mr. SPRATT. Mr. Speaker, I yield 15 seconds to myself. Mr. Speaker, the numbers that the gentleman from Texas (Mr. Edwards) was citing come from a document that we have prepared that compares the conference report with the Congressional Budget Office's current services baseline. And by that comparison, this conference report falls $13.504 billion below current services over the next 5 years. Mr. Speaker, I yield 1 minute to the gentleman from Minnesota (Mr. Peterson), the ranking Democrat on the Committee on Agriculture.

Mr. SPRATT. Mr. Speaker, I yield myself 15 seconds to respond to the gentleman. This chart clearly shows, Mr. Speaker, where the increases in spending have come. They have been supported by the Bush administration and supported by both sides of the aisle because they have gone to national defense, homeland defense, and response to 9/11. Ninety to 95 percent of the spending increases in the discretionary accounts over and above current services have gone to these programs in these 4 fiscal years. You supported it, the President sought it, and we have done it because we had to do it. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Illinois (Mr. Emanuel).

Mr. SPRATT. Mr. Speaker, I yield 4 minutes to the gentleman from Maryland (Mr. Hoyer), the distinguished whip.

Mr. SPRATT. Mr. Speaker, I yield 30 seconds to the gentlewoman from California (Ms. Pelosi), the distinguished minority leader of the House.

Mr. SPRATT. Mr. Speaker, I yield 1 minute and 15 seconds to the gentleman from Alabama (Mr. Davis).

Mr. SPRATT. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Ohio (Mr. Brown).

Mr. SPRATT. Mr. Speaker, I yield 2 minutes to the gentleman from New Jersey (Mr. Menendez), the distinguished chairman of the House Democratic Caucus.

Mr. SPRATT. Mr. Speaker, I yield 1 minute to the gentlewoman from California (Ms. Lee).

Mr. SPRATT. Mr. Speaker, I yield myself 5 minutes and 15 seconds. Mr. Speaker, basically, the budget before us is the President's budget sent to us a couple of months ago, subject to a few puts and takes. Unfortunately, neither the President nor the Republicans in the House nor the Republicans in the Senate have done what was done for years in good budget practice, and that is run their numbers out for 10 years. They simply give us a 5-year display of their numbers and that conveniently avoids showing the effect, the enormous effect, on the budget of having the renewal of the tax cuts after the year 2010. But if Members want to see basically where this budget will take us, they can look in CBO's analysis done in the early part of March required by law of the President's budget because it basically is the same as the President's budget. They do not have to read past Page 2 in this analysis of the President's budget. And when they do, they will see that if we follow the path that the President is proposing, we will add $5.135 trillion to the national debt to the United States between now and 2015, over the next 10 years. But that calculation does not include anything for fixing the AMT, which CBO tells us will cost $642 billion in revenues; and it includes nothing for deployment of our troops in Iraq and Afghanistan after 2005, which CBO calculates at $384 billion; and it includes nothing for partial privatization of Social Security even though the President estimates it will cost $774 billion. When we add all of those things in and calculate their effect on the budget, here is what happens. I have sat here for the last hour, heard Member after Member on the other side saying we have got a budget that will cut the deficit in half over the next 5 years. Here is what happens: take it from CBO, make these two or three noncontroversial adjustments to their number, and see what happens. The deficit never gets below $362 billion. At the end of the time frame, it is $621 billion, $7 trillion of additional debt. That is where we are headed. That is where this train will take us if we adopt this budget resolution today. Do the Members believe me? Let me show which side should be regarded as credible. Let us just look back at the recent past. When Bill Clinton came to office, the deficit was $290 billion. Awaiting him was the biggest deficit in our Nation's peacetime history. We passed the Clinton budget, and every year thereafter the bottom line of the budget got better for 8 straight years until in the year 2000 we had a surplus, 5 years ago, of $236 billion. Every year since, the bottom line of the budget has gotten worse. And I have got a much simpler, more emphatic way to describe the effects of it. This chart right here shows us how much we have had to raise the statutory ceiling on the permissible amount of debt that the United States can incur, the debt ceiling, over the first Bush administration. And guess what. In this budget resolution too. Over the first Bush administration, in 4 years there were three increases in the debt ceiling that totaled $2.234 trillion. It is a matter of record. That is where the budget took us over the last 4 years. And this budget, vote for this budget resolution and buried in it is a provision which will increase the debt ceiling of the United States by another $781 billion. Members are voting for that if they vote for this resolution tonight, a total over 5 years of $3.015 trillion increase in the national debt of the United States. Incredible. But as I said, that is not all. Read chart two, Page 2 in the CBO report, and they will see it goes on and on and on. We stack debt on top of debt. I have heard people come out here and say we are flush with revenues in the aftermath of these tax cuts, we have had a rejuvenation of revenues. Here is the truth if Members want a very simple back-of-the- envelope form: this is where the Bush administration told us we would be if we passed their tax cuts. We would have, in the year 2004, $1.118 trillion in individual income taxes. And here is what the actual take was last year: $811 billion. That $300 billion shortfall in revenues accounts for three-fourths of the $412 billion deficit last year. People may ask, and I think it is fair for all of us to ask, how do we run a $427 billion deficit and still have room for additional tax cuts which the Republicans are pushing in this budget resolution, another $106 billion of tax cuts pushed in this budget resolution? There is one short answer, a simple step: when we do not have the income taxes because we cut these taxes, we go to the Social Security trust fund, and there is a surplus there of $160 billion. We reach into the surplus not this year but next year and every year for 10 years to come as far as the horizon can see, and this is what happens: every year this budget resolution will result in the consumption of the Social Security surplus. With the problems we have got in Social Security, surely we should have one rule until we finally find the grand solution, that is, do no harm. This bill does harm year after year after year because it raids the Social Security trust fund. Mr. Speaker, I reserve the balance of my time.

Mr. SPRATT. Mr. Speaker, I yield 1\1/4\ minutes to the gentlewoman from South Dakota (Ms. Herseth).

Mr. SPRATT. Mr. Speaker, I yield myself the balance of my time. Mr. Speaker, this is not a budget that follows the will of the House. That is the first problem with it. The will was expressed 2 days ago. Two days ago, 348 Members voted emphatically against any Medicaid cuts. The conferees disdained that instruction and whacked $10 billion out of Medicaid. This is a budget that does contain spending cuts, but in this budget the spending cuts do not go to the bottom line and reduce the deficit dollar for dollar. Basically, what they do is offset partially the tax cuts that are also called for. Consequently, this budget is not a budget that will bring the deficit into balance. We have a deficit of $427 billion this year. I said earlier, do not take it from me. Take it from CBO. Read their analysis of the President's budget. This is basically the President's budget with some puts and takes. They project that over the next 10 years, if you follow that budget, we will incur $5.130 trillion. This budget resolution, if Members vote for it, includes an increase in the statutory debt ceiling of almost $800 billion. That is the course we are on, stacking debt on top of debt. Now, one would think with all the problems we have got we would do something about the deficit in this budget, but this budget does not make the deficit better. It adds $167 billion to the CBO baseline deficit over the next 5 years and worse in the second 5 years. We are just kicking the can down the road, and this budget very conveniently avoids the huge mountains just over the crest of the horizon. So if you want to vote for a balanced budget, vote down this budget resolution. If you want to vote against accumulating debt on debt and leaving our children with mountains of debt, vote against this budget resolution. Send the budget conferees back to work with something that is respectable and deserving of our vote.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, let me respond to the gentleman's contention about taxes. When the Bush administration presented its tax package, they told us that the revenues produced by the individual income tax in 2004 would be $1,118,000,000,000. In fact, in 2004 revenues produced by the individual income tax were just over $810 billion. There was a $300 billion shortfall in revenues beneath the projection of the Bush administration, which accounts for three-fourths of the deficit, $412 billion deficit in 2004.

Mr. SPRATT. Mr. Speaker, I thank the gentlewoman for yielding me this time. Mr. Speaker, it has been more than a month since the House and Senate both passed budget resolutions on a fast track, but it was only Tuesday of this week that the House finally got around to appointing conferees. We had the first and only meeting of the conference yesterday amid reports that a conference report was almost a done deal. The meeting was a formality, to give some semblance of collaboration to the budget process. But there has been no collaboration. There has been no transparency. This conference report was prepared by Republicans and their staff behind closed doors, at times and places unknown to me, even though I am a conferee. So not surprisingly, this conference report does not reflect the resolution that we would have passed had we been full partners in this process. Let me tell you what this conference report is not. This is not a budget that follows the will of the House as expressed 2 days ago in the motion to instruct conferees. Two days ago, 348 Members of the House voted emphatically against Medicaid cuts. The conferees disdained the instruction and whacked Medicaid anyway for $10 billion. So this is a budget with spending cuts, and the Republicans will tell you that these are necessary to reduce the deficit. But in this budget, the spending cuts do not go to the bottom line and reduce the deficit dollar for dollar. They will be used to offset tax cuts so that they will at least partially offset their impact on the bottom line of the budget, because, you see, this budget does not make the bottom line better. It does not make the deficit better. It makes it worse. The government faces a deficit this year of $427 billion. Now, you would think that with deficits of this size, that the budget would be used to make the bottom line smaller not larger, but not this budget. It does just the opposite. This will make the budget $167 billion worse on the bottom line over the next 5 years than the CBO baseline budget. I have right here what we could put together as quickly as possible, given the short amount of time we have had, a back-of-the-envelope analysis. Let me go through it bullet by bullet. The House-passed budget produced deficits of $127 billion above the deficit in CBO's current services baseline forecast. This report, this conference report produces deficits that are $40 billion greater than the House-passed budget; $167 billion above the CBO baseline. This does not improve the deficit problem. It makes it worse. The conference report calls for $35 billion in reconciled spending cuts, compared with $69 billion in reconciled spending cuts in the House budget resolution. That $35 billion difference accounts for most of the $40 billion difference in total deficits. In the conference report, there are cuts in nondiscretionary spending, big cuts, $150 billion over 5 years. But they are virtually offset with defense discretionary spending increases, so these two accounts in discretionary spending are basically a wash. And as for the tax cuts, they remain at $106 billion. So what we have here is a budget that does not help the situation. This is a budget that hurts the situation. And let me mention one particular aspect where harm is done that is wholly unnecessary. Everybody knows that we have a problem with Social Security, looming insolvency. Call it a crisis, call it a problem. You would think that a budget of this kind would at least, if it did not have a grand solution, would at least do no further harm. But instead, this budget, in order to pay for the reduction in income taxes, reaches into the Social Security trust fund, takes out $160 billion and spends that entire trust fund surplus for the operation of the government, not for Social Security benefits. This is not a step forward for Social Security. This is a step backward. And it is just another reason that we should all, all of us, oppose this bill. It is bad in substance. It's bad process.

Mr. SPRATT

Mr. SPRATT. This chart shows the percentages of our debt that are held by foreigners. As you can see, they have steadily increased to the point where in 2004 the share of foreign-owned debt rose to 44 percent. One of the reasons that it is difficult to get this message across to the American people is that they are not really feeling the effects of it, since foreigners are buying for now a lot of our debt. But when and if they cease buying it in huge quantities as they have been, we have got a problem.

Mr. SPRATT. Reclaiming my time, in the meantime, they are accumulating claims against the United States that could some day be called.

Mr. SPRATT. Well, we have to probably inflate our currency. But let us not get into that. We are still not in that bad of shape, and I do not want to get into dire predictions. But we are forewarned. We all know there are limits to which anyone can go, governments, individuals, households, companies, corporations, there are limits to which you can go in borrowing money. It is a function of what your income is, and we are beginning to approach those limits.

Mr. SPRATT. Mr. Speaker, I yield to the gentlewoman from Nevada (Ms. Berkley). I traveled to Las Vegas to spend the day with the gentlewoman from Nevada (Ms. Berkley) a couple of weeks ago, and we went all over the City of Las Vegas, from three different editorial boards, to television, to a town meeting, and we found people there very much concerned about Social Security and about the shape of the budget.

Mr. SPRATT. Reclaiming my time, that is correct.

Mr. SPRATT. That is correct.