John Spratt

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, this is a bit difficult to follow, but once you understand it, it is a very graphic chart. Basically what this shows is in the red line at the top is a course of outlays from the 1980s through the current period, 2004. What Members see here is when President Clinton came to office in 1992-1993, spending was at 22.5 percent of our gross domestic product. Federal spending constituted 22.5 percent of our GDP. That is about the point at which President Clinton came to office, and this may be a surprise to some people, but because of budget discipline, because of PAYGO, because of the discretionary spending caps, two different budget plans in 1993 and 1997, every year outlays came down. At the same time, we enhanced revenues. That is the politically polite way to put it. We increased the revenues to the government. They came up. At the point at which they crossed as a percentage of GDP, you have balance for the first time in 30 years because we worked on both sides of the ledger, adding revenues, holding back spending. We had a balanced budget for the first time in 30 years. CBO, the Congressional Budget Office, was to look back on this period with some astonishment and appreciation and say 48 percent of the success achieved in eradicating the budget deficit during the 1990s was due to revenue increases, 52 percent was due to spending curbs, cuts, and decreases. There we have it right there. Outlays continued to go down, and receipts continued to come up; and the difference between the two right there is the surplus that we had in the year 2000, $236 billion. But the blue line here, receipts plummeted with the tax cuts. The recession, plus the tax cuts, caused receipts to plummet while spending went up. We have the exact opposite of what we need in fiscal policy in order to bring or keep the budget in balance. We have increasing expenditures and decreasing revenues. The Cato Foundation, which is probably the most conservative think tank in the United States, certainly in Washington, D.C., the Cato Group has said the Bush administration has succeeded in creating a fundamental mismatch at the base of our budget. They say we have Big Government spending and Little Government revenues, and the result is the deficit.

Mr. SPRATT. Mr. Speaker, I yield to the gentleman from North Carolina (Mr. Etheridge).

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I rise today in strong support of S. 2057 and H.R. 3104. S. 2057 provides retroactive travel reimbursements for troops who returned home before December 19, 2003 from Iraq and Afghanistan for rest and recuperation leave. H.R. 3104 provides separate combat medals for the operations in Iraq and Afghanistan. I think you would be hard pressed to find a Member of Congress who opposes these low cost bills to benefit our troops. The only question is: What took us so long? During debate on the $87 billion Iraq supplemental last October, I introduced an amendment that would have provided for free travel all the way home from Iraq and Afghanistan for troops on R&R leave, and would have required separate campaign medals be issued for service in Iraq and Afghanistan, among other important personnel benefits. The Republican leadership in the House would not even let this amendment on the floor for a vote. So here we are six months later, and we are only just now revisiting the issues. Why so long? Quite simply, the Bush Administration opposed separate war medals for Iraq and Afghanistan, preferring instead to issue one service medal for the Global War on Terror. I understand the Administration's desire to put these operations in a larger context, but that does not translate to our troops on the ground. Circumstances leading up to and in Iraq and Afghanistan were very different, as are the challenges our troops face on the ground today. Furthermore, the Pentagon policy not only authorized a single medal for OEF and OIF, it does not prescribe service stars to reflect service in both conflicts or multiples tours of duty in the same conflict. This is blatantly wrong. Campaign and service medals proudly reflect military service in a particular conflict, enhance esprit-de-corps, and are a strong part of military history. It means a great deal to an infantryman to look at his fellow soldiers and say ``Iraq--yes sir, I was there.'' The British established the Iraq Campaign Medal to recognize service in, and in support of, operations in Iraq. Australia established separate ``Afghanistan'' and ``Iraq'' clasp for their Active Service Medal to reward OEF and OIF service. So why would we deny our servicemen, who are sacrificing so much for our country, separate medals that can boost morale for such a small price? And if the Global War on Terror continues for many years on many fronts as the President has suggested it might, are we to expect that the Administration would prefer that we issue no new campaign medals in perpetuity? H.R. 3104 makes sure this will not be the case. S. 2057 and H.R. 3104 are low cost, long needed morale boosts for our troops in the field, and though it has taken us too long to get to them, I wholeheartedly urge their passage today.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank my good friend and fellow colleague on the Committee on the Budget for bringing this motion to instruct to the floor, and I rise to urge support amongst all Members, both sides of the aisle, for this motion to instruct conferees. What does this motion do? It simply directs the conferees, who will be appointed today, to accept the pay-as-you-go provisions included in the Senate-passed budget resolution, which would make PAYGO applicable to both entitlement spending increases and tax decreases. It would make those steps on either side of the ledger deficit neutral in order to pass. Let us not forget that we have a deficit this year of $521 billion, and if you take the President's budget as projected by the Congressional Budget Office, the deficits over the next 10 years will accumulate to $5.132 trillion. That is why this motion is necessary. The Senate resolution creates a PAYGO point of order against any tax cut or any entitlement increase that adds to the deficit, the bottom line of the budget. That point of order can only be overridden by the vote of 60 Senators. The gentleman here says, well, it takes 60 votes because of the filibuster rule to pass anything in the Senate. But there is a way around the filibuster rule in the budget process called reconciliation. If a tax cut is included in the reconciliation provisions of a budget resolution which is passed by majority vote, by one vote is all that is necessary, then reconciliation can dispense with the 60-vote requirement. So, in order to have at least 60 Senators stiffen their spines and stand up and say, and I would like to see the same procedures in the House, no, we are not going to commit this act of further increasing the deficit, this rule would apply. In contrast to the PAYGO provision in the Senate budget, the House budget resolution which we passed last week by a narrow margin contains what I can best describe as a half measure. It is nonbinding language. It endorses a single-edge PAYGO rule, by which I mean it applies only to entitlement spending and not at all to revenues. The one-sided PAYGO rule in the House Resolution would make no effort whatsoever, none, to temper tax cuts, although, since 2001, tax cuts have added four times as much to the deficit, mounting deficit, as entitlement increases have. Ironically, ironically, this form of PAYGO would also open the way to initiatives that might otherwise be spending entitlements. That is because it could allow them to become law as tax expenditures, put in the Tax Code, called tax cuts, without being offset, and this could actually worsen the deficit and further complicate the Tax Code. The original PAYGO legislation was part of a budget summit agreement that was reached between the first President Bush and Congress in 1990. That rule was extended in 1993 and 1997 but allowed by Congress and the second President Bush to expire in 2002. The original PAYGO rule cut both ways. It applied to both revenue decreases and entitlement increases, and it worked, Mr. Speaker, it worked. It was one of the basic steps that we took in a long, arduous journey that moved the government out of mammoth deficits, $290 billion in 1992, to huge surpluses, $236 billion in 2000. The Senate version simply restores the rule to its original form, that is all. In the House Committee on the Budget, the renewal of PAYGO in its original form was explicitly endorsed by none other than the chairman of the Federal Reserve, Mr. Greenspan. I asked him myself, Mr. Chairman, do you support the restoration of the PAYGO rule in its original form? He said, absolutely, I do. I asked, Mr. Chairman, would you apply it to expiring tax provisions? Yes, sir, I certainly would. He was unequivocal in his support for it. So also is the AARP, the Concord Coalition, the Committee For Responsible budget, anybody who is a responsible, informed observer of the budget process, who knows what PAYGO did for the 1990s, it stiffened our spine and helped us put the budget into balance for the first time in 30 years. We need it today more than we did then, because we have, as I said, a deficit of $521 billion. We have a cumulative deficit over the next 10 years of $5.136 trillion if you do not include Social Security. We need the PAYGO rule with both edges applicable today as like never before in both houses, the House and the Senate. If nothing else, if nothing else, this can be the one bold step we take in a budget that otherwise does very little to move us out of deficit. So I urge everyone, vote for the motion to instruct, vote for PAYGO in its original proven-to-work form, applicable both to entitlement increases and tax decreases, vote for this motion, and reinstate one of the best rules we have ever had for putting the budget in balance.

Mr. SPRATT. Mr. Speaker, in the Democratic budget resolution, let me remind the gentleman, we incur a lower deficit than their resolution. Every year for 10 years, we incur $1.2 trillion less debt than the President's resolution, and we merely bring spending back to baseline so that we can restore what is needed for priorities like education and veterans health care.

Mr. SPRATT

Mr. SPRATT. Can the Chair give us an estimate of when he expects to close the roll and announce the vote?

Mr. SPRATT. Mr. Speaker, but if the original purpose was to save time, why are we now extending time?

Mr. SPRATT. Mr. Speaker, if the purpose of setting the vote at 5 minutes was to save time, the House's time, what purpose is served by allowing the roll to stay open for more than 20 minutes?

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I ask unanimous consent to proceed for 1 additional minute.

Mr. SPRATT. Mr. Chairman, I yield 3 minutes to the gentleman from North Carolina (Mr. Price). (Mr. PRICE of North Carolina asked and was given permission to revise and extend his remarks.)

Mr. SPRATT. Mr. Chairman, I yield 6 minutes to the gentleman from Ohio (Mr. Brown) and ask unanimous consent that he be allowed to allocate portions of his time.

Mr. SPRATT. Mr. Chairman, I yield myself 2\1/2\ minutes. Mr. Chairman, the gentleman just said that we have cut taxes and revenues have gone up. In fact, taxes were cut in 2001. Revenues, individual income taxes were $994 billion that year. The next year they went down to $858 billion. The next year down to $793 billion. This year the estimate is $765 billion, well below the $994 billion level when taxes were cut on individuals. The facts simply do not bear out the statement he made. Let me also straighten out some other facts. First with respect to Medicare. The chairman, in putting together his mark, decided that he would adopt the CBO baseline for Medicare spending as opposed to the OMB baseline, which was $535 billion. CBO is $400 billion. So ignoring the President's actuaries, he put in the lower number. We, in order to have an apples-to-apples comparison with that resolution, have adopted the CBO baseline. Also, there is no difference between us in Medicare benefit spending. However, because the administration of the program can be improved, we provide $805 million more over 5 years for Medicare administration. Also, on the mandatory side, we provide $8 billion for the Family Opportunity Act, an act that has enjoyed bipartisan support because it provides Medicaid coverage to children with special needs in families who otherwise would not qualify for Medicaid and cannot obtain private insurance. This is compassionate conservatism. We provided $8 billion to fund that program so we can finally get it established, and we added two more provisions in our budget resolution. First, we said if the price of Medicare, in fact, exceeds $400 billion, then the prohibition against negotiating drug prices included in the Medicare prescription drug law should be suspended and we should negotiate lower prices. Secondly, we said take some of the excessive subsidies provided for the HMOs and redeploy that money. In the Committee on Ways and Means, we have got reconciliation instructions to that effect. Redeploy that money to make the Medicare prescription drug benefit better. We have a manifestly better set of provisions for Medicare and Medicaid in our budget resolution. Mr. Chairman, I yield the balance of my time to the gentlewoman from Oregon (Ms. Hooley).

Mr. SPRATT. Mr. Chairman, I yield 1 minute to the gentlewoman from California (Ms. Pelosi), our distinguished minority leader.

Mr. SPRATT. Mr. Chairman, we have come up with a budget which takes these difficult facts and, number one, tries to set a target date for bringing the budget to balance. We do that in 2012. Secondly, we have tried to bring the deficit in at lower and lower rates each year, and lower than our opposition, the Republican budget on the floor. We have succeeded in doing that. We adopt the full PAYGO bill. As a consequence of what we propose in our budget resolution, we bring the budget to balance in 2012. At the same time, within this fiscal framework, we provide for middle-income tax relief, we provide more for education, more for veterans' health care, more for science under the NSF function of the budget, for example, more for the National Institutes of Health, more for health care. Usually we are bringing spending back up to baseline. It is not a great deal more, but it is more in almost every respect, proving we can deal with the deficit without pulling up the drawbridge. We can be compassionate conservatives, conservative in the sense that we bring the budget to balance, compassionate in the sense that we deal with the needs of the American people and our country and do not turn our backs on them. This is a good resolution we are offering as a substitute. It is fiscally and morally responsible, and I urge that every Member vote for it.

Mr. SPRATT. Mr. Chairman, I demand a recorded vote.

Mr. SPRATT. Mr. Chairman, we have to bring to conclusion this resolution, and then we move to a final conclusory debate on the surviving resolution, if this resolution does not prevail. Is that the sequence?

Mr. SPRATT. Mr. Chairman, if the gentleman would allow me to do something he did earlier, and that is acknowledge the indefatigable work that our staff did. Tom Kahn, my chief of staff, Joe Minarik, and the staff members in back of the aisle, Sarah Abernathy, Arthur Burris, Linda Bywaters, Dan Ezrow, Jennifer Friedman, Jason Lumia, Sheila McDowell, Diana Meredith, Kimberly Overbeek, Scott Russell, Andy Smullian, Lisa Venus, Andrea Weathers, Jason Venner and Allison Colflesh, they have worked extremely hard over the last several weeks to bring this to fruition, and I am grateful for all of their support. By the same token, I know the chairman feels the same way about his staff.

Mr. SPRATT. Mr. Chairman, I yield myself 4 minutes. Mr. Chairman, this has been a long debate for which I am grateful because the gravity of this problem calls for it. I wish all our effort could have been devoted to the search for common ground for a better solution; but I am afraid, as we bring it to a close, we find ourselves diverging more than converging. That is unfortunate, because the longer we put off the resolution of this problem, the more difficult it is going to become. Here is the situation in a nutshell: the government will run a deficit this year of $521 billion. The President and our Republican colleagues claim that their budget will cut that deficit in half over the next 5 years; but, pardon me, I doubt that. For one thing, on the spending side, they leave out any supplemental funding beyond 2005 for Iraq and Afghanistan. I wish they were right about that, but I doubt it. On the revenue side, they leave out any fix for the Alternative Minimum Tax, even though the Treasury Department tells us it will soon affect 30 million tax filers. So it is unrealistic to project revenues without it. Worse still, after 2009, the Republican budget quits; and that is when it really gets tough. That is when I am afraid the budget gets worse. They leave us expecting that the budget is linear and that over time the deficit will be reduced, the half that is supposedly left in, but I do not think it will work out. Let me just show you a few charts. At the expense of maybe showing you some things you have already seen, the first chart is a roller coaster. What happened when Bill Clinton came to office, President Clinton came to office with a $290 billion deficit. He put it in surplus by the year 2000 by $236 billion. It took really three budget agreements to bring it to resolution like that. Then in the last 4 years, you see this precipitous decline. Now, I know that recession, terrorists, and war have all taken their toll on the economy and the budget; but there were conscious, deliberate choices made that caused this budget to skyrocket down. There in another graphic portrayal is what happened. This is the Clinton administration building up surpluses, moving from deficit to surplus. Every year the bottom line of the budget is better. And here is the Bush administration, every year it gets worse and worse. This chart shows on the far left side where we are today, looking at a deficit this year of $521 billion, a swing in the budget over the last 4 years of $760 billion, a phenomenal reversal of fiscal discipline. Despite the claims the President makes that he will cut this in half, when we make what we regard as basic, realistic, politically inevitable adjustments to his budget, this is where you end up in 2014, not with a diminished deficit, but about where we started out, $502 billion as opposed to $521 billion. It treads water, at best. The problem does not go away. It does not go away with growth; it does not go away with anything but an effort to bring it to healing. Here is part of the problem. We have heard the Republicans say here that tax cuts have not done all of that. That is true. Part of the problem is that these surpluses were overestimated by 50 percent to start with. Now, when we look at the size of their tax cuts, the wedge taken out of the tax cuts, by the tax cuts out of the remaining surplus, that is about 50 to 55 percent. It is about half the problem that we are looking at today. Here is another aspect of the problem right here. The tax cut agenda is $3.77 trillion over the next 10 years. This is pending, enacted tax cuts already. On top of that, we are increasing defense over the same period of time by about $1.3 trillion over inflation. That is why, as this chart right here shows, the big hump is the cost of Iraq and Afghanistan. If we extend it, taper it off, and it concludes up here, we will add about $1.5 trillion over and above inflation to defense between 2002 and 2011, more than we anticipated spending in current services. I am not saying it is not needed. What I am saying is, when the Republicans say we have to bring spending to heel, we have to bring spending under control, this is where it is occurring, as this next graph shows. As these three bar graphs show, over the last 4 fiscal years, 90 to 95 percent of the increase in spending over and above current services has occurred in these accounts, and they are not likely to be reined in. Mr. Chairman, we are not coming to grips with the budget today in this resolution. Unfortunately, the resolution avoids bold strokes and it will take bold strokes, believe me, to untie this Gordian knot. If we want to strike a bold stroke, if we want to do something about the deficit, if we want to do something about saving and making solvent Social Security, vote against this budget resolution. That is the single best thing we can do for deficit reduction and for putting our country back on fiscal track. Vote against it, send us back to the drawing board. Let us come to the House with something worthy of passage, something that will put us back on a path to a balanced budget. This resolution will not do it. Mr. Chairman, I reserve the balance of my time.

Mr. SPRATT. Mr. Chairman, I have no further requests for time, and I am prepared to begin the closing arguments, if I may reserve the time not yet used and add it to the 5 minutes for closure.

Mr. SPRATT. There is not at all.

Mr. SPRATT. Mr. Chairman, I yield 30 seconds to myself. The only bracket we refer to is the bracket that would include those making over, earning, having incomes over $500,000 a year, which is our definition of a wealthy person. So we are saying do not take all the benefits away from those taxpayers that have been provided by the 2001 and 2003 tax cuts, but consider cutting them in half, for example, in order to raise the revenues, to offset the costs of extending middle- income tax provisions like the 10 percent bracket, the child tax credit and the marital penalty provisions. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from Texas (Mr. Edwards).

Mr. SPRATT. Mr. Chairman, I ask unanimous consent that the manager's amendment be modified with the modification I have placed at the desk.

Mr. SPRATT. Mr. Chairman, will the gentleman yield?

Mr. SPRATT. Mr. Chairman, I yield 1 additional minute to the gentleman from Texas (Mr. Edwards).

Mr. SPRATT. Mr. Chairman, I yield 1 minute to the gentleman from Illinois (Mr. Emanuel).