John Spratt

Mr. SPRATT

Mr. SPRATT. Madam Chairman, I yield myself such time as I may consume. Madam Chairman, I thank the gentleman for his kind compliment, and I pick up on something he said. He said that among the principles of both budgets is the commitment to protecting those in need. In light of that, I would like to point out that our budget resolution makes provision for $18 billion for low-income assistance programs and another $70 billion to enhance and improve access for working families to health care that they do not have because they are not fortunate to work for an employer who provides coverage. Madam Chairman, I yield 6 minutes to the gentleman from Massachusetts (Mr. Capuano), the former mayor of Summerville, Massachusetts, to talk about this aspect of our budget.

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, some years when we do the budget it is routine, even inconsequential; but some years, as in 1990 when we did the budget summit with President Bush and again in 1993 when we did the Clinton budget, and in 1997 when we did the Balanced Budget Agreement, the budget lays down a path that we follow for many years to come. This is such a budget. Because of what we did in 1990, 1993, and 1997, we are reaping the consequences of our fiscal good behavior. We think we see enormous surpluses projected at as much as $5.6 trillion; $2.6 trillion to $2.7 trillion, after we back out Social Security and Medicare. So this is a watershed budget. We are going to make an allocation of these surpluses that will last for at least 10 years and beyond, and that is why what we are doing has to be done with great gravity. The chairman of our committee, the gentleman from Iowa (Mr. Nussle), just laid out six principles. Well, let me compare the difference between us and them, using his criteria, his six principles. He started with debt retirement, and I heartily agree. The more debt we can pay down, the better for our children and the better for our future, the better for Social Security and Medicare. So what is the scorecard on debt retirement, debt reduction? Our budget, our resolution on the Democratic side over 10 years between 2002 and 2011 will reduce the debt held by the public, Treasury debt held by the public by $3.681 trillion. Their resolution, the Republican resolution, will reduce that debt by $2.766 trillion. We win on that score by $920 billion. Not even close. Tax relief. The gentleman said we should give some of the surplus back to the American people; and we agree, heartily agree. We have set aside one-third of the surplus to give it back to the American people in the form of tax relief to those taxpayers who need it the most. But in making room for tax cuts, we have also left room for other things that people clearly want: education. That was the next on the gentleman's list. The next criterion by which to judge the budget resolution he said was education. Listen to this: because we made room for other priorities, and were not just fixated on tax cuts alone, we provide $132.8 billion over the next 10 years, that much, $133 billion more than the Republican resolution would provide for the education of our children. There is no comparison. It is not even close. We went hands down on that particular issue. A stronger national defense. I have been on the Committee on Armed Services for all of the time I have served here, more than 18 years; and I heartily agree, we need to do more for national defense, we need to modernize our defenses. We have been living off what we spent in the 1980s during the 1990s and now we need to put a little bit more into defense, so we do it. We have in our budget resolution $48.2 billion more for financial defense than they provide. They provided the gentleman from Iowa (Mr. Nussle) the opportunity to supply a different number, but we are realistically budgeting for defense $115 billion in budget authority over and above the baseline set by the Congressional Budget Office, which is an inflated baseline, a baseline equal to inflation. That much more for national defense. At least for now, we win on that score as well. Medicare reform. That was the way it appeared on the gentleman's list. If we look through his budget resolution, the Republican resolution, we look in vain for any proposal for Medicare reform. It is not there. There is a vague proposal about prescription drug benefits for Medicare; but if we are really absolutely earnest about Medicare, then one of our chief concerns has to be how long will its solvent life last so we can tell older Americans it will be there when they need it. We will not be cutting it because we cannot extend its solvent life. We have drawn a strict principle here. We want to add prescription- drug benefits to Medicare; but because we do not have a huge tax cut, we have a moderate tax cut, we have the resources, the wherewithal to do that by using resources from the general fund of our budget, not by dipping into the trust fund of Medicare and diminishing that trust fund and shortening its life, which is what the Republicans propose to do. They want to give to Medicare with one hand and take from it with the other, so that the result is, they get a very meager prescription-drug benefit, mostly for low-income beneficiaries and a shortened solvent life for Medicare. We extend the life of Medicare, and we provide a robust $330 billion to provide prescription-drug coverage under Medicare. However, my biggest concern about their budget and the biggest difference between us and them and the point that I would close on is just this: I have been here for 18 years. I came here when the deficit was just beginning to mount. We have tried to get our arms around this terrible thing we call the deficit and change it; and we finally, finally, after 18 years, reversed some of the fiscal mistakes we made in the early 1980s and put this budget in surplus, surpluses that nobody ever thought possible. Surely we do not want to take any action now, now that we have gotten here, that would put our budget surplus in jeopardy. But this is what the Republican resolution does. If we want it drawn as a line graph, here it is to my right. That red line against the blue background is where their bottom line would go, what resources are left over. We take the surplus that is available, back out the tax cuts they propose, back out Social Security and Medicare, adjust it for spending increases; and this is the path that they are plotting for the future. From 2002 to right here around 2007, 2008, we are skating on thin ice. We are skating on thin ice. We barely have a surplus at all. There is no margin for error, no room for a mistake here. Let me show my colleagues what could happen if these robust assumptions about the growth of our economy on which these frothy, blue-sky surpluses are based. Let us assume that the growth rate in this country drops from the assumed rate on which these surpluses are predicated, from the assumed rate of growth of around 3 percent down to 2.5 percent, a drop of just one-half of 1 percentage point from 3 percent to 2.5 percent. As we can see, we go to the red in a hurry. We are back to borrowing from Social Security and Medicare once again. Just a slight deviation, just a slight mistake, error, or inaccuracy, and we are well below the line again. Having worked here for years, to finally get to this day where we have a surplus, I hoped it would give us some freedom, some freedom for policy initiatives, for priorities that we have long deferred, help us pay down the debt of this country, help us address at long last the long-term problems of Social Security. That is a path we do not want to take. It has been too long, too hard getting to where we are to risk it all for this kind of projection. That is why I say, there is a real difference between the budget resolution that we present and theirs. It scores better on every criterion the chairman just presented. It provides funds for extending the solvent life of Social Security and Medicare. They do not. But it leaves room for other priorities, prescription drugs, education, defense, agriculture which they have not provided for in their budget. Ours is a better budget resolution, and I think the debate that is coming up will clearly, clearly show that. Mr. Chairman, I reserve the balance of my time.

Mr. SPRATT

Mr. SPRATT. Absolutely, Mr. Speaker. Look at the bottom line on this chart again, complicated as though it may be. In 2002, the amount left over is $20 billion. It is a lot of money. But keep in mind that that does not include the plus-up for defense, and it does not include the plus-up for agriculture. The two of those could easily be $15 billion, even $20 billion, in which event we are in the red again. We are dipping into those trust funds as early as 1 or 2 fiscal years from now. It is right there. The numbers are right there. It is their particular budget proposal. That is how close to the margin it comes. Now, there is an appearance abroad that this budget allows us to sort of have our cake and eat it, too, to have big tax cuts and not really to have any significant programs cut that are important to people, particularly children. One of the things that the President touts in his budget is he increases NIH by $2.8 billion and takes it one step away from doubling over a period of 5 years. So do we. It is important. We agree with that. However, if we read on, we find that that $2.8 billion increase in the NIH budget comes out of its parent agency, the Department of Health and Human Services. It comes out of its hide. They also have other important agencies: the Center for Disease Control, the CDC, the community health centers. They suffer so that NIH can get the plus-up. We provide NIH the plus-up and also adequately raise the HHS budget so that other good important health programs do not have to suffer to pay for the widening wedge for NIH. They do not. Let me tell my colleagues something else. One of the reasons that I do not think we should be out here tonight or today or tomorrow doing the budget is we still do not have the detail we need to know exactly what is in this budget proposal. When we press the Secretary of HHS for further detail, he said, ``I do not have it. It will come to me April 3 or thereabouts from OMB.'' When we press the Secretary of Agriculture for further details, we could not get it. She told us she would find out on April 3 also. When we asked the Secretary of Defense to come testify, he would not testify because he is not ready to testify. But we know he is coming back with a big bag for more money. However, look at what happens as a result of trying to plus-up some things while holding other things constant. In HHS, here we have a President who ran on the campaign slogan that he would leave no child behind. He told us in his State of the Union message that his wife, a lovely woman, Laura, was a librarian, and she would see to it that children's programs were properly attended to. Look carefully at the HHS budget when it comes. Based on documents released last week to the New York Times, there are three major cuts. Where are they coming in the HHS budget? In children's program. Why did he cut them? They have no voice. We finally got the child care and development block grant up to $2 billion last year. Why were we pushing to get it up? It is a central ingredient for welfare to work. If mothers do not have child care, they cannot leave their kids alone at home. So we had to do it. We raised it $800 million to $2 billion. Still not enough. But it includes and covers 214,000 additional children. What has been targeted at HHS for reduction by OMB? You got it, $200 million out of children, child care. We also added money to the account for abused and neglected children, just $178 million in the whole budget of HHS. What has been targeted for cuts? According to the New York Times, that particular program, taking money from abused, neglected children. Finally, we dealt with some huge omissions that have been overlooked for years and is not at all defensible. Most Americans do not know it, but graduate medical education, interns and residencies, are paid for through the Medicare program, indirectly, but substantially, to the tune of about $10 billion. That is fine for everybody but pediatricians. They do not see patients on Medicare. So our children's hospitals have not enjoyed that kind of subsidy in the past that all other specialties have enjoyed at the teaching hospitals. We finally corrected that last year with a $235 million fund, and that, too, is under target. So when one talks about a budget that is providing for our needs and wants, not leaving any child behind, what one sees is that this big tax cut has even shoved the most critical and sensitive programs on the back burner.

Mr. SPRATT. Mr. Speaker, even if we do that, what we are doing when we take them out of the equation is using the surpluses accumulating for now in those two trust accounts to buy up debt we incurred in the past, outstanding debt. In the past, we used it to fund new debt; and the proceeds of that new debt we used to fund new spending. Now, we have both agreed, I will give the other party credit, we have both come to an accord that we will use both of these programs solely to buy up existing debt. Unfortunately, our Republican counterparts are breaking faith with us on the Medicare part A trust fund, the HI trust fund, because they are effectively saying we can use some of that to pay for prescription drug benefits under Medicare. $153 billion of the $392 billion that will accumulate over the next 10 years, they say we can spend it on Medicare drug coverage. But if we do that, it will not be there to pay for the other hospital insurance in-patient benefits to which it is primarily obligated.

Mr. SPRATT. Mr. Speaker, I thank the gentleman from Wisconsin for the recognition. This is a complicated chart, but it says everything about the budget, why we are still here at this hour of the evening talking about it, trying to make the case, the point that this budget really cuts to the bone. And I have three problems with the budget in general. First of all, it cuts so close to the margin that it leaves no room for error. If these projections over 10 years, a period that everybody agrees is a precarious amount of time in which to cast economic projections, if these projections are off by the slightest amount, this bottom line here, the so-called on-budget surplus, the surplus remaining after backing out Social Security and Medicare, it is just $20 billion next year, and by 2005, it is actually negative, because it begins to decline in 2004. It is never a significant number until about 2008 or 2009. That is the margin of error, the cushion fund, if you will, in case these projections go wrong. So that is a first problem I have with the budget. What can happen? We just talked about education. If we are wrong here and that goes into the red, then we will see education under pressure again. Discretionary accounts like that that are funded every year will be under the gun again. Secondly, by committing the lion's share of our surpluses to the massive tax cut they are proposing, and when you provide for the additional interests that we will have to pay because we are using the surplus for tax reduction rather than debt reduction, very little room is left for any other priority. If we want to see where the difference is, look at education, critically apparent when we look at education, because we have a balanced approach. We put a third on debt reduction, a third on tax reduction, and a third on priority spending. We have money for the first time, real money for education, $130 billion over 10 years more than what the Republicans are proposing in their budget, $130 billion. There is no difference, no comparison between us and them when it comes to education. That begins at the beginning when we set our framework and said we have got an unusually good stroke of fortune here. We are now reaping the consequences of fiscal good behavior. We, therefore, want to set aside something for those programs which we have denied and deferred in prior years as we tried to subdue the deficit. Education leads the list. We think it is the future. We think it is the ladder that holds up opportunity in America. So we allocate $130 billion more than they do to education. Finally, Social Security and Medicare, we all know that, in 2008, the first of the baby boomers will retire. Seventy-seven million of them are marching to retirement right now. They are already born. They are not going anywhere. They will soon be claiming their benefits. We have got about 10 years to get ready. All through the 1990s, we knew this, but we did not have the wherewithal to deal with it. Now that we have the wherewithal, the $5.6 trillion surplus, we have an obligation. We have an obligation to deal with it. As I have said earlier, we may be sitting on what appears to be an island of surpluses, but we are surrounded by a sea of debt. A large part of that debt is not monetized. It is unfunded, so to speak. It is represented by the promises that have been made to the beneficiaries that have yet to retire but, nevertheless, need those benefits when they do retire for Social Security and Medicare. The unfunded liability of those programs today, if we funded the account adequately to provide for their solvency indefinitely into the future is $3.1 trillion. That is the unfunded liability. Now, we can either take some of our surplus and use it for that, or we can slough the problem off on to our children and let them pay for our retirement, the baby boomers' retirement. What is the morally responsible thing to do? It is to take some of the surplus we have now and set it aside for Social Security and Medicare, and that is exactly what we do. The first thing we do in our budget, we take a third of the surplus, $910 billion, we assign it to the future of these two programs in equal accounts, to Medicare and Social Security; and it ensures the solvency of these programs, Medicare to 2040, Social Security to 2050. That is not fiscally irresponsible. That is fiscal responsibility.

Mr. SPRATT

Mr. SPRATT. Madam Speaker, at the appropriate time we will, on both sides, recognize our staffs, because although we do the talking, they do the arduous work that goes into this enormous task of putting together a budget. We have one particular staffer that I want to recognize tonight. Late last week, as we were working another night well past midnight, I looked at Sara Abernathy and I said, ``When are you due?'' She said, ``Next Wednesday.'' I said, ``For goodness sake, get yourself home.'' Well, the baby was not born Wednesday, it was born March 26 at 10:30 p.m. It is a Democrat. And I would simply like to say to Sara Abernathy, who has worked arduously in putting this budget together for us and for the good of everybody, ``Congratulations on the birth and arrival of Nicholas Colum Butler on March 26.''

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, in 1 minute this chart says it all. These are the reasons we cannot support this tax bill. It starts with the surplus, a blue sky surplus estimated at $5.6 trillion. We then back out what everybody agrees we should back out, the surplus in Social Security, the surplus in Medicare. That gives us an available surplus of $2.527 trillion. And what is the cost of this tax cut? When we add debt service, associated debt service, and when we also add the cost of extenders we know will be provided and the cost of fixing the AMT, it is $2.3 trillion. That leaves $207 billion to cover other priorities and Social Security. It leaves no room for error, no room for other priorities, no room for Social Security and Medicare. That is why we are offering a much more moderate substitute that is balanced and will provide for all of these things, including tax reduction.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I rise in support of the budget process and in opposition to this rule because it overrides, overrules and dispenses with the budget process. We are here talking about a tax bill for a particular reason. We are here because we have moved the budget from a deficit of $290 billion, a record deficit, in 1992, to surpluses no one thought possible just a few years ago, surpluses that extend as far out as the eye can see. We did that because we adhered to a budget process. We adopted a provision that we would have 5-year forecasts and 5-year budget resolutions, and then we extended that to running out tax cuts, their application, to 10 years. We adopted ceilings, caps for discretionary spending. We imposed a rule called the pay-go rule, a rule that says you cannot increase entitlements or cut taxes unless you offset the amount so as to make it neutral on the bottom line. That is why we are here today. That discipline has helped us reap this reward of doing a major tax bill. Let me say something. Democrats want to cut taxes. We are proposing tax cuts of $800 to $900 billion. Republicans want to cut by more, but the problem they have got is not by how much they want to cut so much as the fact as they are putting the cart ahead of the horse. What they want to do is do this without first having a budget resolution. Regarding all of those rules and budget process disciplines that I just mentioned, if you look in the Congressional Budget Act of 1974 where they are codified, you will see emblazoned at the very top of these provisions the language, ``No budget-related legislation shall be considered before a concurrent budget resolution has been adopted.'' That is the very thing we are doing today. That principle, which is emblazoned in big bold letters in the Congressional Budget Act, is being violated by this rule and this rule overrides and waives major provisions, major disciplines in the budget process. First of all, section 303. Section 303 says you shall not do a tax cut for future fiscal years until you have done a concurrent budget resolution. They are able to skirt past that particular provision because of the curious language of it. It says you cannot do one if it first decreases taxes in the fiscal year covered by the concurrent budget resolution. Since they first decreased the taxes this fiscal year, they are able to skirt by it but they violate the principle of it. They skirt by it only to run smack into section 202. You see, this bill contains tax provisions that indirectly trigger credits to certain working families. Because of that, the bill increases refundable tax levels and as a result it violates the provisions of section 311, section 401, and section 302, three distinct provisions of the code. It violates section 302 because you are exceeding the committee allocations that were set in the budget resolution last adopted, it violates section 311 because you are exceeding total spending, and it violates section 401 because you are creating new entitlement authority. And it violates the spirit of section 303. We are trashing the budget process. The disciplines that have brought us to this day where we can have a big tax cut, we are abandoning. Mr. Greenspan was cited just a minute ago. Last week, he was asked about the budget projections and the fact that we were moving immediately with a tax cut. He said, all of these projections, regardless of how optimistic they are, will be worthless if you do not have the discipline and the process in place to keep it in balance.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, my colleague, Mr. Clyburn and I rise today to take a moment and recognize Mr. Lonnie Thompson, President of SOPAKCO of Mullins, SC, which has facilities in each of our congressional districts. Mr. Thompson was recently presented the Colonel Merton Singer Award for outstanding contributions to the Department of Defense. The Colonel Singer Award is the Research & Development Associates for Military Food & Packaging Systems, Inc. (R&DA) most prestigious award for industry. He was selected for this award based on his significant accomplishments in the area of supporting U.S. forces in all locations throughout the world. He has led his company to improve the quality and contents of Meals Ready to Eat (MRE), Unitized Group Rations, and other specialized rations. His leadership has placed SOPAKCO into the forefront of supporting military forces. SOPAKCO was founded in 1943 to package military rations for Allied troops during World War II. Today, SOPAKCO's Packaging division serves military, humanitarian and non-military organizations around the world. SOPAKCO Packaging maintains and operates a packaging plant in Mullins, South Carolina, and a food processing facility in Bennettsville, South Carolina. Mr. Speaker, Lonnie Thompson's accomplishments are of the highest order and support the needs of the Department of Defense for today and tomorrow. Mr. Thompson's leadership and commitment is what we recognize and honor today.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman from Missouri (Mr. Skelton) for yielding the time to me. Mr. Speaker, I rise to support the conference report on H.R. 4205, and I commend my colleague from South Carolina (Chairman Spence) for his weeks of labor on this bill and on 29 other bills, I believe, over the 30 years that the gentleman has been here. This bill bears his name in recognition of his years of patriotic, diligent, effective service as chairman of the Committee on Armed Services; and it is a bill worthy of his name. Mr. Speaker, I am pleased in particular with the provisions of this bill that deal with retiree health care. I want to commend on our side, the gentleman from Missouri (Mr. Skelton), the gentleman from Hawaii (Mr. Abercrombie), and the gentleman from Mississippi (Mr. Taylor) for taking up this issue, pushing it, persevering and also the conferees for bringing it to fruition with a generous package of improvements to the health care we offer to our military retirees. Mr. Speaker, I am concerned, I am concerned that these provisions by shifting so much spending from discretionary to mandatory will not leave the Pentagon with any cost-containment incentives. I think that will bear our watching and oversight in the future. But on balance, we owe it to our military retirees to continue medical coverage after the age 65. It is an outrage that we have terminated it, and I strongly support these provisions to right that wrong. Mr. Speaker, I rise to support the conference report on H.R. 4205. I commend my colleague from South Carolina, Chairman Spence, for his work on the bill. Indeed, it bears his name in recognition of his years of diligent service as Chairman of the Armed Services Committee, and it is a bill worthy of his name. I am pleased in particular with the bill's provisions on military retiree health care. I want to commend Representatives Skelton, Abercrombie, and Taylor for pushing this issue early on, and the conferees for working out a generous package of improvements to the health care offered our military retirees, particularly Medicare- eligible retirees. With passage of this bill, retirees 65 and older will no longer have to abandon doctors they have grown to know, and or be forced into HMOs or under-served Tricare networks. Instead, for the cost of their Medicare Part B premium, retirees can stay with their own doctor, and Tricare will serve as a Medigap policy, paying their co-payments and deductibles for costs Medicare does not cover. I am concerned that these provisions do not provide the Pentagon with any cost containment incentives. But on balance, we owe it to our military retirees to continue medical coverage after they reach age 65, and I support these provisions. While I support the provisions for military retirees and the bill overall, as Ranking Member of the Budget Committee, I must point out that this bill exceeds the budget resolution. I do not blame the Armed Services Committee for this departure. To the contrary, this bill illustrates the dangers of adopting budget resolutions that are not realistic. Just as the appropriations targets will be exceeded this year by tens of billions of dollars, this bill alone will exceed the budget resolution's mandatory allocations by $20 billion over five years. In the future, if we want our budget process to have meaning, we must be more realistic, as we were in the Democratic budget resolution I brought to the floor last March when we provided an increase of $16.3 billion for retiree health care. The conference report also contains language recommending that the President advance Admiral Husband Kimmel and General Walter Short posthumously to their highest wartime ranks of four-star admiral and three-general. Kimmel and Short were the Hawaiian commanders scapegoated for the success of the attack on Pearl Harbor on December 7, 1941. Official investigations have exonerated them from dereliction of duty charges. Nevertheless, Kimmel and Short were singled out for exclusion from the benefits of the Officer Personnel Act of 1947, which allowed World War II flag-level and general officers the privilege of retiring at the highest rank attained during the war. This sole exclusion only perpetuates the myth of their responsibility for the disaster at Pearl Harbor. I have worked for this issue for years. The Senate actually approved this provision last year, but it did not make the conference report. I am grateful now that we have reached a just conclusion. I want to thank Chairman Spence for his support, and also thanks to those in the other body who helped ensure passage of this amendment, especially Senators Kennedy and Roth. In addition, the conference report includes reauthorization of an important ``Buy American'' provision for equipment components the Defense Logistic Agency has determined to be mission-critical: ball bearings. This standing provision of the law stood to expire this year, and I appreciate the support of Procurement Subcommittee Chairman Hunter on this reauthorization. These are just a few examples of the important provisions of the conference report. This conference report moves us in the right direction in regard to military personnel, readiness, modernization, and military construction. I urge my colleagues to approve it.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, there has been a lot of reference today to the Clinton budget act in 1993. It was preceded by the Bush budget summit in 1990. On that occasion, when that budget summit agreement, which laid the first level of foundation for the successes we have now seen in the budget, in 1990, when it first came to the floor, only 47 Republicans voted for it, even though their President was a signatory to it and helped negotiate it. Three years later, because of recession, the deficit had not gone down. It was $290 billion, a record high, and headed up on September 30, 1992. That was the level of the deficit when Bill Clinton came to office on January 20, 1993. On his desk lay an economic report to the President, George Bush, that said over the next 5 years the deficit would hover in that range and exceed $300 billion by 1998. Well, we got to 1998 and got to 2000, and we did not have those horrendous deficits; and there is a reason, because in 1993 we came over here and stepped up to the problem. There was some features to the package that we passed in 1993 I did not like, they were unpopular to vote for; but, nevertheless, they account for the fact that we now do not have huge deficits, but we have enormous surpluses. Indeed, CBO last reported that we could expect a surplus this year of $219 billion, a swing from $290 billion in deficit, in the red in 1992, to $219 billion this September 30. That is nothing short of phenomenal. One of the reasons we are out here today to oppose this particular provision, though I will vote to raise the level of the threshold at which this tax is applicable, we are out here to oppose it because we do not want to see our hard-won successes, this huge phenomenal turnaround, obliterated, blown away because nobody is keeping tabs on the budget, because we really do not have, for all practical purposes, a budget. We have got a table right here that the Committee on the Budget has made up of where we stand at this point in time; and let me walk you through it, because this ought to be the backdrop for today's debate. This is what really concerns us. This is why we are out here in the well of the House taking an unpopular stand for something that is right. CBO last said in July that the surplus over the next 10 years would be $2.173 trillion. Both sides have agreed that the surplus that accumulates in the Medicaid-HI trust fund over that period of time ought to be backed out and treated separately, just as Social Security is. When you deduct that $361 billion, you are down to a surplus of about $1.8 trillion. The tax cuts passed thus far, including the one on the floor today, come to a total of $739 billion over 10 years, revenues that will be deducted from the surplus, if indeed they are passed. That is just this year, tax cuts passed by this House this year, $739 billion, including the tax cut today. Future tax cuts that we can say with certainty will be enacted at one time or another, if not this year. One is the AMT, the alternative minimum tax. We all know that it is drawn in such a way, passed in 1986, that the income threshold is not indexed. Consequently, in the future years, in the very near future, more and more middle-income families for whom this tax was never intended are going to be hit by the AMT, and we will respond. We will change the AMT. So we have taken the AMT correction that you had, the Republicans had in their tax bill last year. We have also factored in tax provisions in the code, concessions, deductions, credits, preferences, that we know are very popular. They have a short time frame, they are not permanent, and we are assuming that they will be renewed in the future, as they always have been in the past. That is $183 billion of known tax increases in the very near future. That is the tax cut activity, $900 billion that you can easily account for that comes off that surplus of $1.8 trillion. Look what we have done in spending. If you just take appropriations, considering the fact we have not put a new ceiling on appropriations in any of our budgets, and assume that discretionary spending will increase at a half percent above the rate of inflation, which is a lot less than it has increased in the last 3 years or since 1995, just a half percent, that is $284 billion. If you assume the mandatory spending increases that have been passed to date, excluding prescription drugs, will become law, that is $54 billion, already passed by this House. If we take the Republican prescription drug bill, their bill, which I do not think you would recant now, CBO's cost estimate of it over 10 years is $159 billion. If we assume that there will be additional farm assistance in the future, as there has been in the past, over the next 10 years I think most people on the Committee on Agriculture would say $65 billion for likely increases and farm protection, given the situation in the farm community, is modest. Finally, if you put in the Medicare provider restorations, corrections to the Balanced Budget Act of 1997 for providers, hospitals, doctors, who are saying they have been cut to the bone by this bill, both sides are now supporting restoration, that is $40 billion. If you adjust that service $376 billion, guess what? You come to a total of $2.261 trillion. That means you are $88 billion in deficit. That is what I have come to the well of the House to do today, to take away the punch bowl. Everybody got excited by this big surplus. The party is over. We are already in deficit if we pass this bill. That is the warning I am issuing right now.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman for yielding me this time. Mr. Speaker, there are different ways to skin this cat; and I guess the puzzling, perplexing aspect of this bill is why we are reaching for a new solution when we have got other solutions ready at hand. For example, as the gentleman from Iowa knows, we are way over the discretionary spending caps. There is no chance that we will adhere to the caps that we set in 1997. We could reset the discretionary spending caps, reinstate the process we call sequestration, so that if we exceed those caps, there is an automatically across-the-board series of cuts that reins in spending to the level we have set. We also have something around here we call the pay-go rule. It applies to tax cuts and entitlement increases. It says, basically, if we want to have either, we have to pay for it. We have to offset it. There must be an offsetting tax increase to diminish the revenue loss or there must be a decrease in an entitlement in order to pay for an increase in entitlement. Those rules are there. Why not simply put them back into working order? Furthermore, if we are really in earnest, the surplus projected for next year, 2001, is $102 billion, per CBO's most recent report. $102 billion is the on-budget surplus without including Social Security. Why go for $25 if the on-budget surplus is $102? Why not raise our sights, lift the bar a bit, and go $50, half of the on-budget surplus? At least why not go for $32 billion, because $32 billion is the amount of surplus calculated into that $102 billion surplus which is attributable to the surplus in the Medicare hospital insurance trust fund? Now, the last time we had a similar bill to this on the House floor, there was a companion bill which sought to redefine the on-budget surplus to exclude the surplus in the Medicare trust account. The surplus in the Medicare trust account is $32 billion in fiscal year 2001. This amount should be, if we are really in earnest about protecting the Medicare surplus, at a minimum $32 billion. Why is it $25 billion? Why have we set the bar so low, and what do we accomplish by doing all this? Now, I voted for it the last time; I will vote for it again this time. But I really think this is more about showmanship than about substance, because there are other ways to do what we want to do. And if we are really sincere and earnest about doing this, it ought to be higher than $25 billion.

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, the NIF is esoteric physics, but it is essential to the quest for reliability of nuclear weapons. If my colleagues believe, as I do that we should forebear testing and one day ratify the comprehensive test band treaty, believe me canceling NIF is not the way to do it. What does the NIF do? The NIF essentially creates the conditions inside of a thermonuclear weapon to an extent we have never been able to explore before, and it helps us to ensure the reliability of our nuclear weapons to validate these complex computer models that we have developed and know that they are reliable. Mr. Chairman, if we ask anyone to list the challenges to our security, almost everyone will say that this spread of fissile materials and nuclear weapons leads to less. One way to curb the proliferation of nuclear weapons is to stop the testing that proves unfeasible, but it is hard for us to advocate that others should not test if we test. The CTBT, therefore, is one of the key pieces to this puzzle, but politically, the CTBT is unlikely to be ratified in country until we are satisfied that our arsenal is reliable and secure and to that end, the NIF is essential; that is why we must proceed with this project and defeat this amendment.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, reclaiming my time, the problem we have is that section 3(b) requires that the congressional budget resolution show receipts, outlays, and surpluses in the OASDI trust fund, while section 5 prohibits it. Am I correct? I had to ask staff to make sure I am correctly interpreting that. Why the contradiction? Is this a result of midnight compromises made on how this bill was to be drafted?

Mr. SPRATT. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, last week, the Vice President introduced the idea of taking the Medicare part A Hospital Insurance Trust Fund off budget, putting it off budget completely. There was no such plan on the other side. Their budget resolution, which they pushed through 2 months ago, used all of the projected surpluses, including the Medicare surplus for tax cuts and a few program increases. To the extent that anyone deserves credit here, I think we should say the Vice President has initiated an idea which the Republican majority is today embracing, but in a different form. They do not go as far as he proposes. The version of this bill that is before us now was not drafted until last night. It was not introduced or referred to the Committee on Budget, which has jurisdiction. Section 306 of the Budget Act gives us jurisdiction specifically over this kind of legislation. We have not held hearings, we have not taken testimony, and our debate is limited to 40 minutes without any amendments in order. For that reason, I would like to put some questions to the gentleman from California (Mr. Herger), who is the sponsor of the bill, if he would answer them for clarification and for legislative history. Why does the gentleman propose not to take the Medicare part A Trust Fund off budget as the Vice President proposed? Why has the gentleman elected not to take it off budget and have a clean separation between it and the rest of the budget?

Mr. SPRATT. I yield to the gentleman from California.

Mr. SPRATT. Mr. Speaker, reclaiming my time, just to say in conclusion that we will take the whole loaf. If the gentleman wants to go with setting it off completely, we will vote for that; and we do not understand why the gentleman has not gone that far. Mr. Speaker, I reserve the balance of my time. Announcement by the Speaker Pro Tempore

Mr. SPRATT. Mr. Speaker, I yield 3 minutes to the gentleman from Texas (Mr. Stenholm). (Mr. STENHOLM asked and was given permission to revise and extend his remarks.)

Mr. SPRATT. Mr. Speaker, I yield 3 minutes to the gentleman from Washington (Mr. McDermott). (Mr. McDERMOTT asked and was given permission to revise and extend his remarks.)

Mr. SPRATT. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I am going to vote for this bill because I think basically we should segregate the part A trust fund. But I am going to plead the abuse of process before acceding to the bill, because this is not the way to make important law. As I said earlier, this bill was not drafted, to the best of my knowledge, until last night. We did not see it this morning until 10 o'clock or 11 o'clock. It was not introduced or referred to the Committee on the Budget. It did not come through the Committee on Rules. The Committee on the Budget has jurisdiction, but we have held no hearings on it. We have taken no testimony. Now the debate is limited to 40 minutes, and there are no amendments in order. That is too bad. The House ought to be able to come out here and work its will on a piece of legislation this important. If we were allowed to, we could have corrected some of the flaws in the bill. I think if we put it to the House as a whole, do we want Medicare taken cleanly off budget, it would be an overwhelming yes. We still do not know why that compromise was made. Secondly, there are glitches in this bill that honest, open debate, an amendment, could, number one, ferret out and, number two, correct. For example, as I pointed out, section 3(b) adds a new requirement to congressional budget resolutions. It requires the resolution to show the receipts and outlays and surplus of the Social Security Trust Fund. Then section 5 of the same bill flat prohibits any agent or instrumentality of the Federal Government from including the Social Security surplus in any document that shows the Federal surplus or deficit. Any instrumentality. What if we were to do that in a newsletter? Are we an instrumentality of the Government? This is a kind of drafting error that we could wash out of the bill if we had an opportunity to do; but we do not, not on the House floor today. This bill requires that Medicare part A be set aside, but it does not require the congressional budget resolution specify exactly how much is being set aside. That seems to me elementary. Why would it not provide that this is the part A trust fund, this is the amount we expect, and we are setting it aside, taking it off the table, out of calculation. So the House has not had an opportunity to do its will, and we are passing a bill that is a lot weaker than it could be if we had an opportunity to make it better.

Mr. SPRATT. Mr. Speaker, reclaiming my time, the gentleman begs the question. If this is what we did with Social Security in order to protect it, why not do the same with Medicare? Has the gentleman made a compromise?

Mr. SPRATT. Mr. Speaker, section 3(b) of the gentleman's bill adds a new requirement to the congressional budget resolution. It requires the resolution to show receipts, outlays, and surpluses of deficits in the Old Age and Survivors, OASDI Social Security Trust Fund. This is a new requirement, for since 1991, budget resolutions have excluded Social Security. Why does the gentleman now require budget resolutions to show the Social Security surplus when, for a decade, they have been prohibited from showing the Social Security surplus?

Mr. SPRATT. Mr. Speaker, reclaiming my time, the gentleman is not separating them. That is just the point. By putting them back in the budget, the gentleman is undercutting the whole idea of having Social Security off budget. It boggles my mind why the gentleman would want to do that, when the idea is to separate these accounts and treat them differently from the ordinary accounts of the budget.

Mr. SPRATT. I yield to the gentleman from Michigan.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman for yielding me time. Mr. Speaker, we will support this bill because there is no reason to oppose it. All it does is enact the inevitable. You see, when Treasury takes in more money than it spends, it simply uses the surplus, the excess money, to pay off debt. It does not sit on the money. It has debt coming due at all times. It pays the debt off, retires the debt, uses the surplus in that manner. So I am mystified when I read this bill by what substantively it is supposed to do. The majority acts as though if we do not put this money in this debt reduction payment account and seal it off, we are going to spend it. But this just begs the question. This is June 20th. The fiscal year ends on September 30. We will not have the incremental additional surplus numbers until some time in July. We are out a whole week in July, we are out for the whole month of August. When are we going to spend it, and who is going to spend it? Who controls the appropriations process? The majority does. They determine what comes to the floor, what is in it and what passes, because they have the votes. So it is hard to see how this money is going to be spent between now and September 30, when they control the process, unless they elect to spend it on a fast track. That raises the next question. If debt reduction is such a good idea, and I think it is a good idea, why does this bill just apply to this fiscal year? Why does the bill present itself in this form applicable for just 3 months remaining in this fiscal year? Why does it just apply to the increase in the surplus, for that matter? There is a $24 billion base surplus already projected. If debt reduction is a good idea, why do we not set aside some of that surplus, allocate it to debt reduction? Why not even go further? Why do we not take a bill and put it on this floor, a bill that does not just apply to fiscal year 2000, but to the next 10 fiscal years, until we have retired the total debt, which simply says out of every surplus we actually realize in the next 10 years we will set aside 50 percent, or make it 33 percent, or 65 percent, some fixed percentage every year allocated by law to debt reduction, if it is such a good idea? I think it is, and I think it would be a good idea before we actually have that money and it is burning a hole in our pocket, some wanting to use it for tax cuts and others wanting to use it for spending increases, let us allocate a certain amount of it by black letter law to debt reduction. We could do that in this bill, but it does not do that. This bill only applies for 90 days. If debt reduction is the majority's top priority, I am also mystified, because I was on the floor here when we presented the budget resolutions, our competing resolution and their resolution, which passed and which became the concurrent budget resolution for fiscal year 2001. It allocates all of the additional surplus, all of the surplus that CBO finds over and above the baseline surplus they project now, it takes all of that additional surplus and allocates it to tax cuts. There is a specific clause in their budget resolution for this year under which we are now operating which permits and encourages them to use all of the additional surplus for tax cuts. If it is such a good idea to use it for debt reduction, why did they not make the allocation there in the budget resolution, which is the operative resolution we have got? As a result of that allocation in their budget resolution, we presented a budget resolution that would reduce debt over the next 5 years by $48 billion and over the next 10 years by $365 billion. Their budget resolution, by contrast, reduced debt by only $12 billion, because it allocated all of the additional surplus not to debt reduction, as this bill would imply, but to tax reduction. So, what do we have here? We have a bill that is absolutely minimal in its impact on the national debt, if it has any at all. The chairman, whom I respect, the distinguished chairman said this could be a model for future years. If it is a model, let us take it and apply it to future years. Let us say a certain amount of the surplus every year is going to be set aside to debt reduction. Let us not fool ourselves and the American people by adopting something which will have little if any impact on the actual reduction in the national debt.