John Spratt

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I yield 15 minutes to the gentleman from Washington (Mr. Baird), and ask unanimous consent that he have the right to allocate the time allotted to him.

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I yield myself 15 seconds. I would add to what the gentleman just said that we all voted by voice vote to increase veterans' health care by $1.2 billion in committee. It passed on a voice vote. Mr. Chairman, I yield 1\1/2\ minutes to the gentlewoman from California (Ms. Waters).

Mr. SPRATT. Mr. Chairman, I yield myself 45 seconds. To complete what the gentleman from Texas (Mr. Reyes) was saying, it is significant and Members should understand that we have made special provision in our budget resolution to see to it that the contracting officers of the full military services have the budget authority backup needed to continue the privatization plan for expanding and improving military housing. Without the action we take, without the additional budget authority we provide these contracting officers, military housing will come to a trickle, if not a screeching halt. We provide that in our budget resolution. In addition, I would say to the gentleman in the well just now talking about NASA that we provide $4.875 billion over 5 years more than the House budget resolution for the projects that he was just praising. Mr. Chairman, I yield 16 minutes to the gentleman from Virginia (Mr. Moran), and I ask unanimous consent that he be allowed to control that time.

Mr. SPRATT. Mr. Chairman, I yield 30 seconds to the gentleman from Virginia (Mr. Moran) to respond.

Mr. SPRATT. Mr. Chairman, I yield 5 minutes to the gentleman from Texas (Mr. Edwards).

Mr. SPRATT. Mr. Chairman, I yield 30 seconds to the gentleman from Texas (Mr. Edwards).

Mr. SPRATT. Mr. Chairman, I yield 2\1/2\ minutes to the gentlewoman from Oregon (Ms. Hooley).

Mr. SPRATT. Mr. Chairman, I yield myself 14 minutes. Mr. Chairman, let me address the last remark made by my good friend, the Majority Leader, the gentleman from Texas (Mr. DeLay), by saying that the budget resolution we will bring to the floor as a substitute for the House Republican resolution will generate a lower deficit, that is right, a lower deficit every year from 2005 through 2014. As a result, the resolution that we offer will accumulate $1.24 trillion less debt over a 10-year period of time, 2005 through 2014, than the President's budget. Finally, and most importantly, our budget will go to balance, our budget will be in balance, in 8 years, in the year 2012. Lower deficits, less debt, a balanced budget by the year 2012. That is what we set out to do. Because, you see, Mr. Chairman, we can remember where we were just 3 short years ago. We can remember that 3 short years ago we were in surplus in fiscal year 2001 by $127 billion. We were in surplus the year before, the last full fiscal year of the Clinton administration, by $236 billion, an unprecedented fiscal performance. President Clinton inherited a deficit of over $290 billion, and every year over 8 years the bottom line of the budget got better, better and better, due to two different budget plans we adopted and imposed during the 1990s; and by the year 2000, we had an unprecedented surplus of $236 billion. We want to go back to where we were when we were running the budget in the black. Three years have seen the budget decline from a surplus of $236 billion in 2000 to a deficit this year in 2004 equal to $521 billion. That is not my number, that is not my creation. Bush's Office of Management and Budget says that the deficit this year will be $521 billion. That means that last year, this year and next year, we will accumulate $1.2 trillion in national debt. Just 3 years ago, with Washington surpluses, we had an uncommon task before us. We were so accustomed to dealing with deficits, we had to ask ourselves afresh, what do we do now that we have surpluses? We had several choices: We could do what we said we could do seven, eight, nine times on the House floor, set up what is called a ``lockbox,'' a corny name for a substantive idea, namely that we would quit borrowing from the Social Security trust fund and henceforth only use the trust fund to buy up outstanding Treasury debt. If we did that, we could pay off most of the Treasury debt held by the public over a period of 8 years, add $3.5 trillion to net national saving, drive down the cost of capital, make Treasury more solvent because it would have less debt to third parties to pay forever, and take the first stride toward making Social Security solvent, which is the most critical problem we face fiscally and domestically, because the baby boomers are on the doorstep of retirement in 2008, and when they retire, they will have a dramatic impact on our economy and on our budget. Or we could take some of the surplus and fund priorities like education and defense, infrastructure and health care, that we had slighted during the 1990s as we bore down on spending in an effort to balance the budget. Thirdly, we could take the surpluses that were projected, not proven, it was not money in the bank, we could take these projected surpluses and pass trillions of dollars in tax cuts. As we pondered that decision, Mr. Chairman, President Bush took office, and he came to office with this big advantage that no President in modern history has enjoyed, a budget in surplus, big-time surplus. And his Office of Management and Budget looked out over 10 years and they said, We foresee $5.6 trillion in surpluses between 2002 and 2010. The President paid little heed to these other options. He forsook the whole idea of the lockbox and saving Social Security. Oh, he paid lip service to it, but his primary, driving, compelling motive was to have the biggest tax cuts possible, and in effect, the Bush administration, as they passed those tax cuts, told us we could have it all, with surpluses this size, we could have it all. We could have tax reduction and debt reduction too. We could have more tax cuts and bigger defense as well. Let me make the record clear. We were for tax cuts on this side, but we wanted more moderate tax cuts. We wanted to be cautious about over- relying on this forecasted surplus, we wanted to be careful not to make the tax cuts so big that they left no room for other priorities, and in particular, we wanted to stay out of Social Security, because we had sworn never again to dig into the Social Security trust fund now that we were out of deficit. Those concerns were dismissed in the passage of a huge tax cut, and here you see the consequences. The $5.6 trillion surplus today, in accordance with the President's 2005 budget, is now a deficit of $2.928 trillion. That is a swing in the wrong direction of $8.5 trillion over the last 3 years, a phenomenally incredible fiscal performance over the last 3 years. We warned that the forecast upon which the President's tax cuts were predicated could be off, could be wide of the mark, and sure enough, it was. The economists now tell us it was 55 percent overstated, misestimated. As a consequence, there never really was a surplus sufficient to fund or offset the tax cuts that the President was proposing. Therefore, as a result of the tax cuts, the additional spending that we have had during this period of time, mainly for defense, homeland security and response to terrorism, that additional spending has driven the budget deeper into deficit than would have otherwise been the case. The next chart will show you where we are right now and where we think we are headed if you take the President's budget 2005, if today or tomorrow the House votes for the President's budget. This is where the Clinton administration started out with a deficit of $290 billion, this is where they took the budget, to a surplus of $237 billion, and this is what has happened under the auspices of the Bush administration on their watch. We have descended from $236 billion surplus to a $521 billion deficit. Now, that deficit is bad enough. The administration would have you believe that they are going to cut that deficit in half over the next several years, over the next 5 years. We do not believe that forecast. When we make what we regard as realistic adjustments to their spending curve, this is what happens on this chart here over the next 10 years. We get a bounce from the economy. The economy does help the deficit, no question about it. So we get a bounce in the early years. We go from a deficit of about $478 billion, and it bottoms out $200 billion to $300 billion for the rest of the time. As a consequence, we do not ever see this budget going into balance. Now, we had to do this by what economists call extrapolation. Neither the Republicans in the House nor the Republicans in the Senate nor the Republicans in the White House have given us a 10-year extension of the budget so we can see the real implications over time of what they are proposing in the way of additional tax cuts and additional spending. But we know, because the Congressional Budget Office takes what the President proposes, applies his policy to their baseline, we know where they are likely to end up. And what you see here is in time, over time, the deficit bottoms out close to $300 billion and goes nowhere. To the contrary, look what happens on this blue line. All of a sudden, this blue line, which is the CBO baseline that does not factor in the President's policies, it assumes that the tax cuts, when they reach their expiration date, the sunset date that was written into them when they passed, this line assumes that beginning in the year 2008, the current services bottom line suddenly shoots upwards so that it goes from a deficit in 1 year of $153 billion to a surplus 2 years later of $98 billion. Now, what happens, one might ask, to propel the budget out of deficit into surplus over that period of time. The tax cuts expire. And this chart says volumes about what the source of the deficit problem is. The expiration of the tax cuts passed in 2001 and in 2003, that alone is sufficient to move the budget out of a $153 billion deficit per CBO's projection to a surplus of $98 billion in 2 years. So looking at this kind of study, we have tried to put together a balanced budget, balanced in the sense that the bottom line is black, that revenues are sufficient to cover expenditures; balanced in the sense that we are covering priorities that are essential and vital to the American people, including national defense. Let me begin with that, just to tell my colleagues what we are presenting in our budget today. We have the same number for national defense as the gentleman from Iowa (Mr. Nussle) has in his resolution; but in fact we have more, because we are adding $6 billion more than he provides for homeland defense, which many of us regard as the next and most dangerous battlefield for most Americans. We have middle-income tax cuts. Our resolution assumes that, for example, the marital tax penalty provisions will be extended and renewed. It assumes that the 10 percent bracket will be renewed and extended. It assumes that the welfare-to-work credits will be extended. In addition, we have extended the alternative minimum tax for a year. We have extended the research and experimentation tax for a year. We are not against all tax cuts. We want to see and we state explicitly in this budget resolution that our policy is to balance tax fairness and tax moderation for middle-income Americans with a balanced budget. Now, having met the opposition in defense, what do we do in other areas that are priorities to the American people? In education, because we think it is a critical priority, we provide over 5 years $9.8 billion more than the House Republican resolution. We provide over 10 years for education $50 billion more than President Bush's budget calls for. We increase Pell grants. We provide more for the environment. By that I mean the Clean Water Act, the Safe Drinking Water Act, and the Land and Conservation Fund is fully funded. We provide veterans health care at the level that the chairman of the Committee on Veterans' Affairs said he would require, that the veterans health care system would require if we are going to meet our obligations and our promises. We provide in the defense budget that the survivor benefit provisions be carried out. We provide needed budget authority so that family housing for military families can proceed apace. For science; for health; for the NSF, the National Science Foundation; and the NIH, the National Institutes of Health, we provide a budget that will at least protect them against inflation. We have gotten their funding level up; we do not want to see it whittled away due to inflation. If my colleagues go down the list like this, they will see in good, solid categories where the need is clear and compelling, we have provided more than they. We have dealt with America's needs and will outline this more explicitly with different groups of Members as the day goes on. But we have done it within the framework where we bring the budget to balance by the year 2012, accumulate less debt, and move out of the mire that we are now in towards the days that we enjoyed just 3 years ago when this budget was in surplus. Mr. Chairman, I reserve the balance of my time.

Mr. SPRATT. Mr. Chairman, I yield 5 minutes to the gentleman from Maryland (Mr. Hoyer). (Mr. HOYER asked and was given permission to revise and extend his remarks.)

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I yield 2\1/2\ minutes to the gentlewoman from Connecticut (Ms. DeLauro).

Mr. SPRATT. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from California (Mr. Waxman). (Mr. WAXMAN asked and was given permission to revise and extend his remarks.)

Mr. SPRATT

Mr. SPRATT. I thank the gentlewoman for her contribution. Madam Speaker, going back to this chart, I think it should be obvious to almost any citizen, every fair-minded person, that a budget accumulating a deficit of $3 trillion to $4 trillion over the next 10 years, and possibly more, plotted by this line right here, is a budget that is not sustainable and should not be passed. The Republicans have brought to the floor and will bring up tomorrow a budget resolution that, in effect, hides the outyear consequences because they simply quit in 2009. They do not go further. They do not extrapolate what will happen when the tax cuts, passed in 2001, 2002 and 2003, are made permanent. But what will happen is shown on this chart: the deficit will never get better. We have decided that this kind of problem requires bold decisions, and this budget resolution brought to the floor tomorrow by the majority party does not make them. We are offering instead an alternative. It could be bolder, but it is definitely a step forward and a step in the right direction. Our budget fiscally will sustain smaller deficits each year and every year from 2005 through 2014 because we do not fear the extension of our budget into the outyears, because we propose a path through those years that will eventually bring us to balance. Indeed, our budget will balance in 8 years, by the year 2012, using realistic and reasonable assumptions. We will accumulate less debt, we will have smaller deficits, and we will put the budget back in balance. Madam Speaker, let me emphasize too that in doing so, we will provide the same basic level for national defense as our Republican colleagues, and we will up them one. We will provide $5 billion more than they provide for homeland defense. We will protect the middle-income tax cuts, as I said earlier, the marriage penalty, the 10 percent bracket, the child tax credit. We will even provide that the estate tax should be substantially reformed by significantly increasing the estate and gift tax credits. Within that same context, we will provide $10 billion more than our Republican colleagues do over 5 years, $10 billion more for education. We will provide $2.2 billion more for the environment. We will provide $5 billion, as I said, more for homeland security. And over 10 years, we will provide $6.6 billion more for veterans health care. We have been discriminating and careful about the increases we have made. We have picked our priorities with care. But we protected those things that are essentially important, the safety net and important programs like veterans health care, as they should be protected; but we have still protected our children and our future by bringing the budget to balance within 8 years. Madam Speaker, I appreciate the opportunity to make this presentation and will be back to the floor tomorrow to pick up where we leave off tonight.

Mr. SPRATT. Offset, fully offset. I yield to the gentlewoman from Nevada.

Mr. SPRATT. The PAYGO rule was adopted for 5 years, renewed again for 5 years in 1997, and expired in 2002, and has not been renewed. But for the PAYGO rule, the tax cuts that were passed in the early 2000 period by the Bush administration could not have come to the House floor.

Mr. SPRATT. The gentleman makes an excellent point. If the $521 billion were not reduced or diminished by the offset of the Social Security surplus, which is about $160 billion, it would instead be $681 billion, instead of $521 billion. In truth, he was here when we voted to do it. We have taken Social Security off budget. We acknowledge that the moneys in that trust fund are being accumulated today to be spent in the very near future, and they should not be consolidated with and diminish other accounts. You should look at the budget bottom line without offsetting the Social Security surplus gains.

Mr. SPRATT. Mr. Speaker, I thank the gentleman from Illinois (Mr. Emanuel) for his contribution. The gentleman was talking about the budget. The reason the budget is topical is tomorrow the House takes up what we call the budget resolution. It is a tough task that lies before us tomorrow. The budget resolution is just an outline. This is it right here. I have the Democratic substitute to it. It is about 67 pages double-spaced. So why is it so tough? It is tough because the deficit this year is $521 billion. This year, 1 year, the deficit is $521 billion. The budget is in deficit over the next 10 years by at least two to three times that amount, by at least $4 trillion on top of that amount. That is one reason the task is tough. It is also tough because we did not have to be here. We did not have to be in this situation. Three years ago when President Bush took office, he gained a benefit that no President in recent history has enjoyed. He gained a budget which he inherited in surplus, big-time surplus, by more than $100 billion. The previous year, the year 2000, the surplus was $236 billion. We actually paid off debt of the United States in 1999, 2000 and 2001. That was the context in which Mr. Bush came to office. His economists at his budget shop, the Office of Management and Budget, looked out over the next 10 years and told the President they foresaw surpluses, cumulative surpluses, of $5.6 trillion. Today, just 3 years later, those surpluses have disappeared. Vanished. They are gone. They are no more. In their place we have a deficit, a cumulative deficit, of $2 to $3 trillion over the next 10 years, depending on assumptions you make about tax and spending policy. What happened to that surplus of $5.6 trillion? As it turned out, we warned the President. We had seen surpluses like this projected before. The projection is really an economist's construct of the future, and they missed it. They misestimated the size of the surplus by at least 50 percent. And when you diminish the surplus expected of $5.6 trillion by 50 to 55 percent, it becomes $2.6 to $2.8 trillion. All of that remaining surplus has now been wiped out by tax cuts and then some, and by spending increases, largely for defense. The President says we have to rein in spending, but for the most part, spending has gone to defense, homeland security, the New York bailout, the airline bailout, the consequences of 9/11, categories that could hardly have been controlled. Domestic discretionary spending on education and health care and the environment has been growing at 2 to 3 percent a year. He says we have to rein it in, but he ignores the spending category that is the big spike in the budget. In any event, the surplus has disappeared. The surplus of $5.6 trillion is no more. It has been replaced by a deficit. So you would expect the President in that light to send us a budget this year that would begin to move us into balance, take us back to the path we were on when he came to office, when he saw nothing but surpluses for the next 10 years. The President does indeed present us a budget which claims to cut the deficit in half by 2009, within 5 years. But he omits from that calculation anything for waging war of low intensity against the insurgencies and so forth in Iraq and Afghanistan. Nothing for the deployments we have there. Even though his Office of Management and Budget says that there will probably be at least $500 billion more needed sometime later this year or early next year, you will not find that calculated anywhere in the President's budget. When he says we are going to cut the deficit in half, not a nickel after 2004 is included for the cost of our deployments in Afghanistan and Iraq, even though the cost is substantial and they are not coming to an end, unfortunately, anytime soon. And so the President does not bring the budget to balance. Indeed, he does not run his budget out 10 years as was customary just a few years ago. When he came to office, so that he could say that there is plenty of support for the type of tax cut I am proposing, $1.7 trillion in tax reduction over 10 years, he extended his projection of the budget out over 10 years to get the cumulative total of $5.6 trillion. Those who looked closely noticed that two-thirds to three-fourths of all that surplus occurred in the second half of that 10-year period of time. Now, the surplus has disappeared, the basis for those tax cuts has been removed, so what does the President recommend for next year? Another $1.3 trillion in tax reduction. He recommends making permanent all of the tax cuts made in 2001, 2002 and 2003. We are not here tonight to advocate higher taxes or more taxes or more revenues. We are here to advocate rebalancing the budget as a critical domestic priority, particularly given the fact that in just a few years we are going to see a demographic phenomenon the likes of which this country has not seen before, the retirement of the baby boomers. Within 20 years, the number of people on Social Security will nearly double. The number of beneficiaries on Medicare will nearly double. We should be preparing now by saving, and we are not. We are dissaving. We are spending more than we take in. As a consequence, our children are going to have to bear the cost of Medicare and Social Security for our retirement, for the baby boomers' retirement. And in addition to that, they are going to have to bear the consequences of the debt that we are now stacking up, which could easily be $7, $8, $9 trillion by the time the baby boomers begin to retire and start drawing their benefits. That is why this is a serious period that requires serious fiscal policy. So what does the President recommend? He recommends another $1.3 trillion in tax cuts, and the budget resolution that our colleagues on the other side of the aisle, the Republicans, will bring up tomorrow will embrace essentially the same tax agenda, which can only mean, given the fact that we have no surplus anymore, that every dollar of those tax cuts, if they are enacted and implemented, every dollar of revenue lost due to those tax cuts will go straight to the bottom line, will enlarge the deficit and will make it bigger and not smaller. That is the situation we find ourselves in tonight and tomorrow as we take up the budget resolution, with a tough problem and difficult to handle. Before going further, let me recognize the gentleman from Virginia (Mr. Scott).

Mr. SPRATT. Madam Speaker, I would like to pick up where the gentleman left off with more explanatory charts. We have said that the projected surplus in the year 2001 when the President came to office was an unprecedented $5.6 trillion. There it is on this simple table. Under the President's fiscal policies and under the situation of the times, not all of his making, that surplus declined from $5.6 trillion to a deficit today in accordance with his 2005 budget, which will equal over this same period of time 2002, 2011, a cumulative $2.928 trillion deficit. From $5.6 trillion in surplus to $2.9 trillion in deficit. The arithmetic is simple. That is a reversal of $8.5 trillion over a 3-year period of time. We have never seen fiscal discipline come so unraveled, all of the effort in the 1990s to put the budget in balance for the first time in 30 years, to put it in surplus, to bequeath that surplus to President Bush only to have it absolutely wiped out over the next 3 years. Here is a very simple graph that shows the path the deficit has taken since 1989 when the first President Bush was the President. As we can see, under the administration of the first President Bush, the deficit declined and grew worse, from $153 billion to $221 billion to the point where in the last year the first President Bush held office, we had a deficit of $290 billion. In 1991, 1992, a deficit of $290 billion. That was the situation that President Clinton found when he came to office in January of 1993. If we look at the curve rising up, it shows us that every year of the Clinton administration, the bottom line of the budget got better and better and better. Every year the deficit was lower until 1998 when we had a surplus for the first time in 30 years and in the year 2000 we had a surplus, a phenomenal surplus, of $236 billion. The next year President Bush came to office. Three solid years preceded him in surplus. His own economists told him to expect a surplus of $5.6 trillion. They blew it. They overestimated it. We warned him to be wary, but nevertheless that was the situation in which he came to office. Here is what has happened since. The $521 billion here at the bottom of this chart is the projected deficit for this year from the administration. That is not our estimate. We are not trying to put some sort of spin on it. The facts are bad enough and speak for themselves. The Office of Management and Budget, Mr. Bush's shop, said the deficit this year will be $521 billion. As we see the next chart, we pick up that $521 billion over here on the vertical axis, right there, $521 billion, the deficit in 2004; and then we make some politically realistic, and we think budgetarily realistic, adjustments to the path that CBO, our Congressional Budget Office, has plotted for the President's budget because they make certain assumptions that are, frankly, not realistic. For example, they require by law to assume that when a tax cut expires, it dies, it sunsets, it does not come back. We know from practical experience that popular tax cuts are almost always renewed, and therefore they do not give a plus-up to the budget. If we make assumptions like that, politically realistic assumptions, then the President's budget will go from $521 billion to 389 next year. It gets a bit of a bounce from this economy. It is helping. The economy is helping diminish the budget deficit, but it bottoms out at about that level and stays around 300 to $400 billion for the next 10 years to the point where in 2014, the deficit is still over $500 billion: 521 in 2004; 502 in 2014. That is our best estimate of where we are going under the President's budget per his projections adjusted for what we consider political reality. By the way, the blue line up there, which the gentleman from Virginia (Mr. Scott) was just rising to call my attention to remind the Members, that is the plot we were on, the path we were taking when President Bush came to office, and that is how far we have descended into debt. From all the way up here, $250 billion in surplus down to deficits of $521 billion. It is obvious to anyone, everyone, that a budget deficit of this magnitude requires bold measures. Simple half measures simply will not cut it. We learned that in the 1980s and the 1990s. We need a long-term plan for deficit reduction. We need enforcement to back up our intentions, and we need to look at every segment of the budget, spending and revenues both. If we look at this simple pie chart here, we will see that this wedge, domestic nonhomeland security, discretionary spending, that is, education, the FBI, the Justice Department, the National Parks Service, the government as we know it falls in this wedge right here. The entitlement programs take up two thirds of the budget. This other wedge, the red wedge, is for defense and international support, international aid, foreign aid, discretionary spending; and then this sliver down here is homeland defense. A small sliver today, but growing every year, $46 billion this year, an account that did not even exist in the budget 3 years ago. Well, what does the President propose? Essentially what he proposes is to rein in spending, his words, but he goes only to this segment of the budget, 15 percent of the budget, domestic, nonhomeland security, domestic discretionary spending. He goes to it and begins to clamp down on it and take one-half to one percentage points out of it, cuts that do not seem that draconian in truth. But, in effect, the President takes about $10 billion to $15 billion below constant dollar levels out of the domestic discretionary accounts, and by the fifth year of his budget forecast, that is all that is left. That is all that is left. The cut amounts to $40 billion to $50 billion. It begins to become serious, particularly in accounts like education and health care. Now, we have taken seriously this budget forecast because it is, I think, a call to arms. If you add up all of the deficits shown on this politically realistic line, they come to about $3.5 trillion over the next 10 years. If we are realistic, honest, frank, and face the facts, that is the future we are looking at. I do not think that is a sustainable course. I do not think that is a future we want to have or a situation we want to bequeath to our children. So we have come up with a budget that will be offered tomorrow as a substitute to the budget offered by our Republican colleagues. Their budget never gets in deficit, partly because they only run the budget out 5 years, not 10 years as was customary in the recent past. They do not go the extra 5 years, because that would require them to confront an uncomfortable decision. Their tax cuts will expire within that second 5 years. They intend to renew those tax cuts. But if they renew those tax cuts that were passed in 2002, 2003 and 2001, if they renew those tax cuts, the budget will never balance, at least not on any chart we have got or any forecast that is likely to be made. It will be in deficit for as far out as the eye can see. We, however, have taken our budget and run it out 10 years, and we have made certain assumptions about tax cuts. We protect middle-income tax cuts. We call for the extension of the marriage penalty provisions. We call for extension of the child tax credit at $1,000. We call for extension of the 10 percent bracket. So we protect middle-class tax cuts. In addition, we protect the estate tax. We protect the reforms in the estate tax and call for a reduction in the estate tax by substantial increases in the unified estate and gift tax credits. What do we do? This is most important. After doing these things, spending $10 billion over 5 years, more than they commit to education, $4 billion more to the environment, all down the line with critical priorities, veterans health care, $2.5 billion more than the President provides for veterans health care because veterans deserve it, we promised it, and they are stacked up trying to get appointments at veterans hospitals today. We have taken care of critical priorities with a really discriminating eye as to what really matters. In the process, we have also provided for a fiscal framework that will balance the budget within 8 years, by 2012, will accumulate less debt each year, less deficit each year, than the Republican bill that is the main bill on the floor tomorrow. Our substitute will accumulate less debt, smaller deficits, and will balance by the year 2012. I yield to the gentleman from Virginia (Mr. Scott).

Mr. SPRATT. Madam Speaker, I would say to the gentleman, the word ``PAYGO'' will be used frequently in this debate. In 1990, as we were trying to get our hands around the deficit, we came up with some budget process changes that had enormous significance. They were scoffed at at the time, but they have worked remarkably well. One was the pay-as-you-go rule, or PAYGO rule. What it provided was if anyone wants to cut taxes, he must either cut taxes in one place in the code and raise them elsewhere, or find an entitlement benefit and cut it by an amount commensurate with the tax cut so that it is deficit neutral, it does not enlarge the deficit. By the same token, if one wants to enhance, enlarge, liberalize an entitlement, benefit, it either has to be paid for with a new revenue stream or you have to cut another entitlement somewhere in order to offset it and make it deficit neutral.

Mr. SPRATT. Mr. Speaker, I yield to the gentleman from Illinois (Mr. Emanuel).

Mr. SPRATT. I will put your favorite chart up.

Mr. SPRATT. The green is surplus. It is deficit diminution. The red is a growing deficit.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I rise to call attention to the outstanding career of an extraordinary United States Army Reserve officer, Lieutenant Colonel Paula Shaun Lorick. General George C. Marshall once said, ``There is no limit to the good you can do if you let someone else take the credit for it.'' Lt Col Paula Lorick spent here career in the Army proving that principle. During twenty-five years of exemplary service, Lt Col Lorick embodied the duty, loyalty, and love of country, the selfless service and personal courage that are the core values of the United States Army. Since November 16, 1978, Lt Col Lorick has served in some of the Army's most demanding positions, and served always with distinction. She was a Finance Company Commander, a Postal Company Commander, a key staff member with the Joint Operations Center at US Atlantic Command. In addition to her administrative assignments, Lt Col Lorick was a warfighter, deploying to Dhahran in Saudi Arabia at the height of the Persian Gulf War, and earning the Southwest Asia Service Medal and the Kuwait Liberation Medal. Lt Col Lorick pulled other demanding duty as Deputy Director, Military Member Support and Ombudsman Services with the Employer Support of the Guard/Reserve Organization for the past three years. She played a key role in helping Guard and Reserve members make the transition from civilian jobs to deployment status in support of Operation Noble Eagle, Operation Enduring Freedom, and Operation Iraqi Freedom. Today marks the end of Lt Col Lorick's long and distinguished career. Having been diagnosed with cancer, Lt Col Lorick is being medically retired in a ceremony fittingly held in the Pentagon's Hall of Heroes. In a rare event, Lt Col Lorick is being awarded the Legion of Merit medal, a medal typically reserved for higher-ranking officers. It is a well-deserved, parting tribute from a grateful nation. I offer Lt Col Lorick our gratitude for her service, our congratulations on the honor bestowed upon her today, and our prayers and support in the months ahead.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, today I am submitting for the record the second half of the graduation address given by Arch Barrett at the Naval Postgraduate School Joint Professional Military Education Course in June, 2003. I submitted the other half for the Record on February 24. I commend Arch's speech to all those with an interest in the founding of the Goldwater-Nichols legislation, and I am proud to enter it into the Record. Reflections on Leadership in Defense and Professional Military Education Reform As you well know, White's retirement did not end Congress's involvement in correcting the problems Jones identified. A large part of the credit for keeping the issue alive and finally succeeding in enacting fundamental changes must be credited to the then little-known, and very junior, Representative from Missouri, Ike Skelton. Congressman Skelton was about 50 years old at the time; he was and is, tall and slim, and has a studious air. He also has the gift of quickly conveying to even the briefest acquaintances his interest in, and respect for, them as human beings. An avid reader of military history, Skelton was one of the first members of Congress to grasp the significance of Jones' criticisms of the existing organization. Although he was not a member of White's subcommittee, Skelton probably attended more of the hearings than any member except White. He sat on the dais, listened to testimony, and patiently waited his turn to ask penetrating questions. In 1983, Skelton introduced his own legislation for revamping the Joint Chiefs of Staff. It was based on his conversations with Gen. Maxwell Taylor. Skelton testified in support of his bill before the Investigations Subcommittee. He continued to attend almost every hearing for the next three years even though was never a member of the Subcommittee. During mark-ups and floor debates he defended the proposed legislation. He played a pivotal role in shaping the final outcome. I will tell you what happened as a consequence of White, Skelton and Jones's efforts in a few minutes. First, however, I would like you to ponder a few questions. Why did Jones and White put so much effort into defense reform when they knew nothing could happen in 1982 and that they would not be in office after that year? Why did White, a former Marine and very conservative Democrat who had a solid record of supporting higher defense budgets and Pentagon legislative proposals, choose to take on the Pentagon in his last nine months as a legislator? It must have taken a lot of soul searching for him to reverse course and oppose the Pentagon. He could just as easily have sidestepped the issue and quietly retired from public service. Why did Skelton, also a strong advocate of the Department of Defense, spend so much time over a period of more than a decade wrestling with defense organization matters? As a junior Congressman, Skelton had to be concerned with his reelection prospects. Defense reform probably never garnered one vote for any congressman. Finally, Why did Jones knowingly incur the wrath of the military community that had anointed him with such success? He soon became more vilified by his former colleagues than an American Idol contestant that Simon decides to ridicule. The answer to these questions, in my opinion, is that General Jones and Representatives White and Skelton were leaders in the best sense of the word. Their behavior reveals four essential characteristics of leadership. First, Leaders select their goals and steadfastly pursue them. We followers must hope that the goals our leaders choose are worthy. In this case they were. These leaders chose the harder right rather than the easier wrong. Second, Leaders shoulder their responsibilities. Both White and Jones readily accepted their responsibilities even though they involved personal hardship. Skelton chose to assume added responsibilities because he recognized the need for leadership. Third, Leaders sometimes have to show the way by going first, acting as a guide to others. As you will see, White, Skelton, and Jones's efforts eventually led to a fundamental reordering of the entire Armed Forces of the United States. Fourth, Leaders must constantly prepare themselves. They must be knowledgeable, and be perceived by others as knowledgeable. Representatives White and Skelton were unschooled in the defense reorganization issues. Consequently, they dedicated untold hours to gaining knowledge and understanding of the issues that confronted them. Because White prepared himself, he garnered the support of the committee and the House of Representatives. Because Skelton prepared himself, he was able to shape the final outcome. What happened after Jones and White retired in 1982? Were they vindicated? Yes. But it took four more years of effort. Other legislators saw what White had accomplished and considered his efforts ``unfinished business.'' These leaders included Republican Senators Barry Goldwater, Bill Cohen, and Strom Thurmond, Democratic Senators Sam Nunn and Carl Levin, and Representatives Bill Nichols, Les Aspin, and, of course, Ike Skelton. To a man, these Congressmen possessed strong pro-defense records. All took a stand against the Pentagon and the White House. All were strongly criticized. As leaders, they exemplified the traits first demonstrated by Jones, White, and Skelton. The Goldwater-Nichols Department of Defense Reorganization Act of 1986 rewarded their efforts. The legislation attempts to ensure that when America goes to war the services work together as joint integrated teams of land, sea, and air forces. It strengthened field commanders like Gen. Schwarzkopf in the Persian Gulf War and Gen. Franks in Afghanistan and Iraq today. It also streamlined and unified the chain of command to the field commanders, elevated the chairman above the parochial Joint Chiefs of Staff, and ensured that talented and qualified service officers like you in this audience are assigned to the multi-service staffs. Representative Skelton was responsible for a fundamentally important amendment that gives the Vice Chairman of the Joint Chiefs of Staff the powers he enjoys today. He was selected as one of the seven conferees on the Goldwater-Nichols Act. He negotiated wording with Sen. Nunn that gives the unified commanders some of the extraordinary command authorities they enjoy today. Finally, he headed the Panel on Military Education that I spoke of earlier that was largely responsible for much of the architecture of military education today. I would be the last to claim that the Goldwater-Nichols Act has been the sole reason for the turn-around in U.S. military performance since 1986. Nevertheless, it has played a significant role in the string of successful military operations since then including Operation Just Cause in Panama, the Persian Gulf War, Bosnia, Kosovo, Haiti, Afghanistan, and Iraq. Observing these results, the defense establishment long ago reversed itself and embraced the principles of joint military command and operations established in the Goldwater-Nichols Act. This record of success is a tremendous pay-off for the efforts of Gen. Jones, Chairman White, and Representative Skelton--not only for themselves but also for the nation they served. This record of success is also a credit to you in this audience and the entire armed forces of the United States. It is a privilege for me to have a formal opportunity to express my gratitude to you. As an older person, I long ago left the ranks of defenders and joined those who must be defended. I, for one, very much appreciate the sacrifices you are prepared to make for me, and for all of your fellow citizens. At the beginning of my remarks, I admitted asking myself why I would choose to speak about leadership. Having thought about my experience observing White, Jones, and Skelton, I soon realized precisely why I chose to talk to you on that subject on the occasion of your graduation from JOINT professional military education. I chose to speak about leadership because it would allow me to remind you graduates, as you rejoin your service comrades and assume ever-greater responsibilities, that you have an opportunity to be genuine leaders--leaders writ large. You have an opportunity to choose to attempt to make a difference, as did White, Skelton, and Jones, to select worthy goals and make a dedicated effort to achieve them. You will encounter opportunities to shoulder responsibilities that you can easily evade, to choose the harder right rather than the easier wrong. You will face the choice of whether to continue to prepare yourself to the best of your ability by dint of hard work and study to be a competent leader. I firmly believe that if you are to be satisfied with your life in general, and your performance in the profession of arms in particular, you will choose to assume the burden and reap the rewards of leadership.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I rise to enter into the Record a speech given by a former staffer of the House Armed Services Committee, Arch Barrett. Arch is one of the most unassuming people I know, but was one of the most remarkable and able staffers I've met during my 20 years on Capitol Hill. Arch had an undergraduate degree from both the West Point and Harvard, and later got his Ph.D. in political economy and government from Harvard. He entered the Air Force as a second lieutenant in 1957, saw plenty of action in Vietnam, and retired as a colonel in 1981. While in the Air Force, he received the Distinguished Flying Cross, Legion of Merit, Meritorious Service Medal, Air Medal with 12 oak leaf clusters, the Joint Service and Air Force Commendation Medals, and the Vietnam Service Medal. As distinguished as his military record is, his greatest effect on the military came after he became a staffer for the House Armed Services Committee. If it were not for Arch Barrett, I do not believe Congress would have enacted the Goldwater-Nichols Act. Goldwater- Nichols forced the separate branches of the Armed Services to work cooperatively, and our forces would not be nearly as effective today had it not been for the Goldwater-Nichols Act. The Pentagon fought Goldwater-Nichols tooth and nail, and it took us about 4 years to actually pass the legislation. Whenever the Pentagon raised an objection, we sent Arch Barrett over and he'd argue with the naysayers until they ran out of objections and had to relent. It was a virtuoso performance by someone who had mastered the subject matter. Arch Barrett is now a professor at the Navy Post-Graduate School in Monterrey, still serving his country. He gave the graduation address to the Naval Postgraduate School's Joint Professional Military Education Course in June 2003. In that speech, Arch of course downplayed his own role in establishing Goldwater-Nichols, but did recognize important contributions from several Members of Congress. One of those is a man I, like Arch Barrett, admire--my good friend and colleague from Missouri, the Ranking Democrat on the House Armed Services Committee, Ike Skelton. I commend Arch's speech to all those with an interest in the founding of the Goldwater-Nichols legislation, and I am proud to enter it into the Record. Reflections on Leadership in Defense and Professional Military Education Reform (By Archie D. Barrett) Sixteen years ago, in 1987, Congressman Les Aspin asked me whether there was an uncompleted task in the area of Defense Department restructuring that could be assigned to Representative Ike Skelton. Aspin was the chairman of the Committee on Armed Services of the U. S. House of Representatives. Skelton was a mid-level Democrat on the Committee who was intensely interested in improving the quality and performance of our Armed Forces. I was a member of Mr. Aspin's Committee staff. At the time, the Pentagon was making little progress in implementing the education provisions of the 1986 Goldwater-Nichols Act. The Act required a reassessment and revamping of professional military education to assure that it supported the new emphasis on joint military planning and operations. I suggested to Chairman Aspin that Rep. Skelton could provide a signal contribution to the improvement of the nation's armed forces if he could be persuaded to lead a congressional panel charged with bringing PME into line with the goals of the Goldwater-Nichols Act. Subsequently, Rep. Skelton seized on the opportunity and ultimately fathered the significant changes in Professional Military Education that have culminated in your presence here as JPME graduates at the Naval Postgraduate School. My remarks today will be addressed to the leadership displayed by Rep. Skelton and two other individuals that eventually led to this gathering. We usually think of a leader as someone who is in charge or who heads an organization. I for one barely qualify. My most extraordinary experience in that regard was leading aircraft on night combat missions in Southeast Asia during the Vietnam War. But the aircrews I commanded came together for only one mission and very little ``leadership'', as we usually think of it, was involved. On the other hand, many of you in the audience have been, or will be, called upon to lead in the traditional sense. You may rightly ask what I could convey to you on the subject. I certainly asked that question of myself when I began to contemplate this address. My answer is that I have had the privilege of observing others use their ability, their positions, and their prestige to exert leadership on matters of great importance to our country. Basically, a leader influences other people to behave as he or she wishes. The leaders I will discuss influenced the behavior of hundreds of thousands of members of the armed forces, including you in this audience. It is because of my experience with those men that I can discuss aspects of leadership. At about the time you graduates were attending high school, I retired from the Air Force and joined the staff of the Armed Services Committee. In February 1982, General David Jones, the nation's most senior military officer, testified that there were fundamental flaws in the structure of the highest military body in our Armed Forces, the Joint Chiefs of Staff--or JCS, as it is often called. He proposed that Congress legislate far-reaching changes. Gen. Jones was chairman of the JCS. At the time, he was in his late `50s. He was a tall, dark haired, distinguished looking man in his Air Force uniform with the 4 stars on each shoulder. The general charged that the JCS, a committee consisting of the chiefs of each service, had difficulty making decisions and providing advice to the President from an overall national defense perspective because each chief aggressively pursued the interests of his own service. Moreover, he claimed, the service chiefs had used their positions on the JCS to weaken the field commanders--the CINCs--whose mission it is to plan and conduct military operations. Each service chief wanted to keep as much control of his soldiers, sailors, airmen, or marines as possible. Each chief also sought to maximize his service's budget for tanks, planes, or ships regardless of the needs of the other services. It is no wonder, then, that when the services were called on to work together in military operations, their joint performance was often unsatisfactory. Most of you in this room are accustomed to hearing of nothing but an unbroken string of military successes during your lifetime. Those of us who are older remember a much more uneven pattern of military performances. Jones could point to a whole string of flawed military operations to support his allegations. In Vietnam, the JCS disregarded the principle of unity of command. There were two land chains of command and four air chains of command largely because of each service's sensitivity about placing its forces under the command of a general or admiral of another service. In 1980, the services were unable to work together in an attempt to rescue American Embassy hostages in Iran. Two aircraft collided on the ground killing several servicemen and dooming the operation. The subsequent investigation revealed gaping disconnects among the services in training for the operation and, once again, flaws in the chain of command. Going back to World War II, friendly fire from Navy ships shot down Army aircraft during the invasion of Sicily killing paratroopers and aircrews due to inadequate communications and coordination among the services. Also, in World War II, the Army and the Navy divided the Pacific into two commands, one headed by Gen. MacArthur and the other by Admiral Nimitz, because they could not agree on a unified command structure. The result was a near disaster at Leyte Gulf that could have prolonged the war. In 1983, a year after Gen. Jones first testified, 241 young servicemen were killed in a terrorist attack on a Marine barracks in Beirut. The investigation revealed glaring inadequacies in the military chain of command that wound its way from the Pentagon through Army, Air Force, and Navy flag officers to the Marine colonel and his unit on the ground. In that same year, it took over 6000 U.S. troops to defeat 600 Cubans on Grenada. After action reports revealed that inadequate communications among the services hindered naval gunfire and air-to-ground support of the troops in combat. These and other flawed military operations were not merely unfortunate incidents. As you well know, the price of substandard performance of our armed forces in war is paid in the lives of young Americans. Obviously, General Jones was raising issues of fundamental importance to the American people. But why did the general voice his criticisms on Capitol Hill? Why did Jones not rely on his Commander-in-Chief to address the problems? One answer is that the administration was not interested. A more fundamental answer involves a fact many people do not realize. The Constitution makes the Congress, not the President, responsible for the organization of the nation's defense. The U. S. House of Representatives delegates oversight of that responsibility to the Committee on Armed Services, and further, to one of its subcommittees. Representative Richard White, a Democrat from El Paso, was the chairman of the subcommittee responsible for overseeing defense organization in 1982. White was about 70. He was tall and slim. He was soft-spoken. His ruddy complexion reflected the time he had spent in the West Texas sun. His subcommittee focused primarily on investigations--defense contractor fraud, for example. Almost a quarter century had passed since Congress enacted major changes in defense organization. Understandably, Chairman White knew little about the subject. But he was acutely aware that he was responsible for that part of the Constitution that assigned defense organization to Congress. In April, White convened hearings to determine whether Gen. Jones' criticisms were valid and to ascertain what action Congress should take. The hearings lasted until late July and covered over 1000 pages. The Reagan Administration strongly opposed reorganization. With few exceptions, the Pentagon witnesses opposed change. On the other hand, many witnesses who had previously served in the Pentagon or White House in high civilian positions sided with Jones. They emphasized that the Joint Chiefs of Staff, as constituted, simply did not and could not provide adequate military advice to the President due to the conflicting service interests that dominated the chiefs' thinking. A number of high-ranking retired military officers also agreed with Jones. Others strongly disagreed. Mr. White presided over every hearing. Listening to the conflicting views of the witnesses soon provided him the education in defense organization issues that he lacked when the hearings began. He made himself an expert through his perseverance. Only a few other congressmen, however, attended the hearings regularly. Focusing on defense organization is about as exciting as watching paint dry. Moreover, with the Pentagon leadership and the President adamantly opposed to changes, few legislators felt that the investment of their time would be worth the effort. At the conclusion of the hearings, Chairman White introduced a bill to reorganize the Joint Chiefs of Staff. He had decided that Jones was right. White's subcommittee approved his bill with few changes. One Congressman stated that he did not know much about the complicated issues addressed in the bill. He could confidently support the bill, he said, because Chairman White had presided over the lengthy hearings and was an expert who knew what must be done. White presented his bill to the full Committee on Armed Services in August. The Committee approved it and referred it to the House of Representatives. In the fall, with Chairman White leading the debate, the House passed the bill and referred it to the Senate. In December, Mr. White persuaded Senator Tower, a fellow Texan, to hold a hearing on his bill before the Senate Armed Services Committee. That is the end of my story about Rep. White. Soon after the December hearing Congress adjourned and White's bill died, as do all bills that have not been enacted at the end of each Congress. There was no time for the Senate to consider the legislation. Moreover, Mr. White disappeared from Capitol Hill at the same time. You see, he had long ago decided to retire and did not run for reelection even though he would have had no trouble winning another term. Interestingly, by that time General Jones had also retired. He continued to push for reorganization, however.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I rise to honor R. Lewis Shaw of South Carolina for his service to our state and great contribution to our environment. Lewis Shaw is retiring as Deputy Commissioner of the South Carolina Department of Health and Environmental Control (DHEC), a position he has held since 1984. During his long tenure, Lewis Shaw has become equated with DHEC and the whole gamut of environmental regulation: clean air, clean water, toxic and nuclear waste disposal, and waste remediation. He has supervised the state's involvement in all aspects of the clean-up of Savannah River Site. His command of the issues and professional ability are such that Lewis Shaw has served as our state's chief environmental quality officer under both Republican and Democratic Governors. Lewis Shaw was long ago recognized on the national as well as the state level. In 1985, Attorney General Meese appointed him to one of four State Environmental Directorships on the National Enforcement Council. He served on the Council from 1985-1990, and as Chairman in 1989. In 1988, Lewis Shaw helped create the Southern Environmental Enforcement Network (SEEN,) to facilitate the enforcement of environmental statutes, rules and regulations in member states. He served as Chairman of Southern Environmental Enforcement Network in 1991. Lewis Shaw was a member of the governing body which founded the Southern Appalachian Mountains Initiative (SAMI) in 1994. SAMI is an organization of stakeholders formed to explore the environmental stability of the Southern Appalachian Mountains and develop long-range plans to protect those resources. In 1997, Lewis Shaw was selected to serve as Chairman of SAMI. In 1999, he was elected President of the Environmental Council of the States (ECOS), the non-partisan organization of state environmental commissioners, after serving as secretary-treasurer and vice-president. From 2001-2004, Lewis Shaw served as President of the Environmental Research Institute of the States, ECOS's research arm. Out of respect for him and his wide-ranging experience, Lewis Shaw has been called to testify before numerous committees of Congress, representing the views of South Carolina, and on occasion, all the states on environmental issues. I have had the good fortune of working with Lewis Shaw on some tough issues: on the multiple problems at Savannah River Site, on a toxic waste landfill at Pinewood and a hazardous waste incinerator in Rock Hill; at Superfund sites in Cherokee and Chester Counties; on ozone exceedences in York County and ozone transport, and on clean water throughout my district. 1 could always count on Lewis Shaw to understand the problem and know the law, and to present solutions that were fair and feasible. He has been an asset to South Carolina for 33 years and to me for the 22 years that I have served in Congress. He will be sorely missed and hard to replace, but he leaves a great legacy: a much better environment and a model of performance that everyone in the field of environmental regulation would do well to emulate.