John Spratt

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I yield 3 minutes to the gentleman from California (Mr. Stark) for a colloquy about prescription drugs. (Mr. STARK asked and was given permission to revise and extend his remarks.)

Mr. SPRATT. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, we have come a long way in 8 years. We have come from a deficit in 1992, a record deficit of $290 billion and deficits projected as far as the eye can see, to a surplus computed the same way of $175 billion and that has underlaid this phenomenal economy. We are now at a fiscal fork in the road. We have wiped out the traditional deficit, the deficit in our annual budget. We have created surpluses in place of those deficits as far as the eye can see, but those surpluses only exist because of the way we keep books. We keep a cash set of books. If we had accrual accounting instead of cash accounting and if we recognized our liability to the Social Security program and the benefits promised to those working today and to the Medicare program and the benefits that it entails, we would be booking substantial costs to both of those programs; and I do not think we would be in surplus. We would be in deficit again. There are many differences between our budget, the Democratic substitute, and their budget, the Republican budget. The resolution is on the floor today, but the main difference is this: we recognize our liability to Social Security and Medicare. They do not, and I will say why. Our budget generates savings, too. We have a cumulative surplus over the next 5 years of $48 billion; over the next 10 years of $365 billion. We take the $365 billion surplus, a substantial share of it over the next 10 years, and we direct the Committee on Ways and Means to provide legislation so that $300 billion of that surplus will be taken out of the general fund and contributed to the Medicare Trust Fund so that it will be more solvent than ever; we think more solvent to the tune of at least 10 additional years. We further direct the Committee on Ways and Means to reconcile legislation so that in 2011, 10 years from now, the total amount of debt savings that we are able to achieve because we have accumulated these surpluses over 10 years, the total amount of debt service, the reduction in interest on the national debt, will be computed, and that amount will then be transferred from the general fund to the Social Security trust fund for a period of years such that we can extend its life by 15 years. Those proposals have been made by the President. We put them in reconciliation language in our budget. They simply do not have anything. They are saying they are going to leave the Social Security surplus alone, and we are too. Good policy, and we agree. They are saying they will pay down $1 trillion of debt. So will we, using the Social Security trust fund. But we are going further. We are extending the life of both programs, and that is the main difference between us and them. We have shown in this budget resolution that we are presenting that we can cut taxes, by less, but significantly. We can pay down debt, $48 billion over the next 5 years, $365 billion over the 10-year period in time. We can do all of these things and still provide for the reasonable needs of our country. $20.5 billion more for education, for example, in our budget than their budget. More for community development. In fact, they cut community development by nearly $2.5 billion between this year and next year. The Community Development Block Grant, the Economic Development Administration that means so much to many of our districts, they slice it, $2.5 billion. We plus it up. More money for law enforcement in ours. There is also an account that is vitally important, because this is not spending, this is an investment, more money for science, more money specifically for the National Science Foundation. You know, Mr. Chairman, when we had our markup in the Committee on the Budget, one of our Members from Princeton, from New Jersey, who is a professor of physics at Princeton and knows something about science, offered an amendment to the budget markup which would have added $2.8 billion over 5 years. The gentleman from New Jersey (Mr. Holt) made that amendment, $2.8 billion over 5 years, $675 million a year to Function 250, which provides for the National Science Foundation. The Holt amendment was rejected. There was a compromise reached such that the committee did give him $100 million plus-up in the mark. But, you know, the arguments of the gentleman from New Jersey (Mr. Holt) began to resonate apparently with the majority. Over the last week, something happened. Last night, haunted by the persuasive arguments that the gentleman from New Jersey (Mr. Holt) made in our committee last week, a majority had some kind of an epiphany, because they came around, and after rejecting his requested increase in NSF, they put $3 billion, exactly what he wanted, even more, in the National Science Foundation function. Mr. Chairman, in light of that, I yield 2 minutes to the gentleman from New Jersey (Mr. Holt), to explain what we have also put in our budget resolution to accommodate an increase in scientific research and exploration.

Mr. SPRATT. Mr. Speaker, I thank the gentleman for his comments. Let me go back just in conclusion to this chart so that everybody understands it. This is simple arithmetic. This is not smoke and mirrors. This takes their numbers, their assumption, their claims about what their budget resolution does and adds them up correctly. They claim that they are providing for a tax cut over 5 years of $200 billion, so we adjust their tax cut of $150 billion by $50 billion to show and allow for a tax cut of $200 billion, which is what they claim on the floor and in committee. In addition, they claim on the chart that they just showed and through comments that they have just made that they too will have a pharmaceutical drug benefit for Medicare beneficiaries. They assume costs of that, they have it in a reserve fund, it is $40 billion. If they are going to claim it, they have to count it. They claim it, but do not count it. We count it. Add the $50 billion, add the $40 billion, adjust for debt service, and in 2003, the surplus of which we are all so proud which we want to protect, we do not want to backslide into Social Security, the surplus virtually vanishes. In 2004, there is a $6 billion deficit. We are $6 billion into Social Security again if this resolution is adopted. In 2005, it is down to $2 billion, and the subsequent years are just as bad. That is the consequence. Now, we have tax cuts in our budget resolution, the Spratt substitute, the Democratic budget resolution. We provide for $50 billion net tax cuts over 5 years and $201 billion net tax cuts over 10 years. We think those are reasonable; and we believe that if our colleagues do the tax cuts that they are talking about that they are claiming, they are back in deficit, and that is why this rule should be voted down. Because it waives what we tried to establish as a major point of order last year in the lockbox when we said, we cannot bring a resolution, we cannot bring an appropriations bill.

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

Mr. SPRATT. Mr. Speaker, reclaiming my time, I thank the gentleman for his explanation, although I think it falls short. The fact of the matter is there is provision for off-budget spending. It is on page 33, function 654 and your report; and that function understates spending over the next 5 years by Social Security to the tune of $20 billion. Because my colleagues understate spending here in calculating how much debt reduction they will achieve in the purchase of our debt held by the public, they owe the State the accomplishment of debt reduction. That is a significant mistake, unless they want to say this is a waivable mistake; it is not. It is bad work. It is a good reason to vote against the rule and to take this thing back and clean up. Let me go back to my chart. I did not have enough time to talk about it. This chart is simple arithmetic. In simple arithmetic, it shows my good friend, the gentleman from Connecticut (Mr. Shays), whom I have enormous respect for and who was just on the floor saying they are going to have a $200 billion tax cut. That is what the gentleman from Ohio (Mr. Kasich) said in the Committee on Rules yesterday, and that is what he said repeatedly in our markup. If they have a $200 billion tax cut, then they have to add $50 billion to the amount of tax reduction over the next 5 years. In addition, if they have a pharmaceutical benefit, a drug benefit in Medicare, they have to add $40 billion. And when they add those two things that they both claim are included, $50 billion and $40 billion, guess what? The surplus disappears.

Mr. SPRATT. Mr. Speaker, reclaiming my time, I would advise the gentleman simply to look at page 33 and the gentleman will see there is an on-budget provision and an off-budget provision, and the off-budget provision is the Social Security benefit spending provision. It is $20 billion short. I mean this is government work, but $20 billion is still real money. It is a big mistake.

Mr. SPRATT. Mr. Speaker, function 650 is a discretionary account, but it also has an off-budget account.

Mr. SPRATT. It is indeed.

Mr. SPRATT. I yield to the gentleman from New Hampshire.

Mr. SPRATT. Mr. Speaker, I thank the gentlewoman for yielding, and I would inquire of anyone on this side who wants to explain why the $20 billion is not provided in function 650, spending by Social Security, to effect this policy that the chairman of the Committee on the Budget just claimed that he is accommodating. Where is it?

Mr. SPRATT. Mr. Speaker, I thank the gentlewoman for yielding me this time. Again, I did not have time before, but I think I should call to the attention of the House, in light of what the gentleman from Ohio (Mr. Kasich) said earlier, that this resolution offered by the Republicans does not provide for the abolition of the Social Security earnings test. If it did, on page 33 of the concurrent resolution of the budget under function 650, Social Security over the next 5 years would have to be adjusted by $20 billion. They do not adjust it. They do not provide for this waiver, repeal of the earnings test, despite what the gentleman from Ohio (Mr. Kasich) just said. Now, this is an example of doing something hurriedly, doing something slipshod and not attending to important detail. They are not doing what they are purporting to say that it does. We had the same problem last year. We had a military pay raise on the floor, retiree increases; and the budget resolution did not reflect those, did not account for those. Mr. Speaker, I call it to the attention of the House. Function 650 is unadjusted, does not reflect the cost that over the next 5 years if we are going to repeal the earnings test, we have to add $20 billion in outlay expenditures by the Social Security Trust Fund. Everybody should know that when voting on this rule.

Mr. SPRATT. Mr. Speaker, last year, for the first time in 40 years, we balanced the budget without including the surplus and Social Security. We balanced it to the tune of $704 million. Having reached this milestone, we made a vow on both sides of the aisle when we brought our budget resolution to the floor last year that we would not get back into an on-budget deficit again, we would not slip back into borrowing from the Social Security trust fund. We would use the surplus, we said, in the Social Security trust fund instead to buy up existing Treasury bonds and notes, reduce debt rather than create new Federal debt. To accomplish that purpose we both trotted out something we called ``lockboxes,'' a portentous name. When you got through all the boilerplate, both of them came down to this. You have a point of order. If somebody brought to the House floor a resolution, like this resolution, a budget resolution, and it dipped into Social Security again, went into deficit, you could raise a point of order. Now, to the American people, that suggests summary dismissal. It disposes of the question. But in truth, the Committee on Rules in the House is the task master at waiving points of order. We have before us today a rule that ought to be subject to a point of order if we take the lockbox seriously, because this rule waives all points of order. This rule permits a budget resolution to come to the floor that, in our opinion, would wipe out the surplus in 3 years and, in the 4th and 5th years, 2004, 2005, and subsequent years, it would put us back into deficit again, put us back into borrowing from Social Security. This simple chart, this simple arithmetic on this chart shows you why. The Republicans claim that they have $110 billion surplus over the next 5 years. But the gentleman from Ohio (Mr. Kasich) just showed that they intend to use $40 billion for a prescription drug benefit, and we welcome them to the fold on this issue, because we think it needs to be done. So they have matched us. They have $40 billion for a Medicare benefit. In addition, the gentleman from Ohio (Mr. Kasich) has said on repeated occasions in committee markup, yesterday in the Committee on Rules, last night on the floor, that they will have a tax cut of $150 billion, plus $50 billion more, and if CBO says there are more revenues, they will go up still more. When you factor in that additional $50 billion, the $40 billion for Medicare prescription drugs, guess what? The surplus disappears in 3 years and we are back in deficit, back into borrowing from Social Security. So this in simple arithmetic is the argument why this rule should be voted down. Vote it down. Make the Republicans bring back to the floor a budget resolution that safely is in surplus, and not this one, which clearly puts us in danger of backsliding into deficit and borrowing again from Social Security.

Mr. SPRATT

Mr. SPRATT. Mr. Chairman, I would waive my time, but I will save 30 seconds just in case I have to answer something that the gentleman from Ohio (Mr. Kasich) may have to say. I have no purpose in using the 5 minutes time. Mr. Chairman, I yield back the balance of my time.

Mr. SPRATT. Mr. Chairman, this is the last budget resolution that the gentleman from Ohio (Mr. Kasich) will bring to the House floor after many years. As he leaves the House, he leaves a large void. I came here with him in 1983. I can speak from personal experience because I served on the same committee with him from the day we first arrived here. As a matter of fact, the reason I am on the Committee on Armed Services is that, when the gentleman from Ohio (Mr. Kasich) did not get on it, he went to Bob Michael, raised hell, they went to Tip O'Neill, and Tip and Bob Michael agreed to enlarge the committee by two people. I got one seat. The gentleman from Ohio got the other. I have enjoyed his company. I have enjoyed his friendship. I have admired his commitment to public service, his energy, his effervescence, that infectious boyish smile that, after all these years, has not gone away. In fact, with the addition of twins, it has really blossomed back again. We are going to miss him on the floor, in the gym, committee room, and everywhere. I can say this genuinely, no one that I know of in the 18 years I have been here brought more fervor to the support of an issue and yet less spite than the gentleman from Ohio (Mr. Kasich). No one in my recollection has been better in the well of the House, somebody one always wanted to have on one's side, better on his feet particularly extemporaneously than the gentleman from Ohio (Mr. Kasich). Nobody has been better liked in the 18 years I have been here on both sides of the aisle. He has made a great contribution to this House, one of the great institutions of the republic, and to this country. I am sorry to see him leave after this term. He is not gone yet. I do not want to write his obituary too soon. I am sorry to see him leave, and I am assuaged to some extent by the feeling I do not think I have seen the last of him in public office. It has been a pleasure working with the gentleman from Ohio (Mr. Kasich) and serving with him, and we are going to miss him. Mr. Chairman, I yield to the gentleman from Connecticut (Mr. Shays).

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

Mr. SPRATT. Mr. Chairman, just about a month ago, the Chairman of the Joint Chiefs of Staff, Gen. Henry Shelton, testified that guaranteeing life-time health care is not only important to keeping the promises made to those who have dedicated their careers to military service, but also to attract and retain quality personnel today. This issue is tied to the readiness of our Armed Forces, and will be one of the top defense issues Congress will have to address this year. In truth, I was surprised to see that the Republican budget resolution does not provide any funding over the next five years to improve health care for military retirees over the age of 65, not even funds to pay for prescription drug coverage. The Democratic alternative budget, however, does not dodge this issue. Currently, military retirees 65 or older lose guaranteed access to the Department of Defense (DOD) health care system. The Democratic budget funds two major initiatives the Republican resolution ignores: a permanent and nationwide expansion of Medicare Subvention, and a guarantee that these retirees have access to the Department of Defense's prescription drug plans. These are the major provisions of H.R. 3655 that are geared to Medicare-eligible military retirees. H.R. 3655 is a comprehensive military health care bill introduced by Representatives Neil Abercrombie, Ike Skelton, and Gene Taylor. The Democratic alternative directs the Armed Services Committee to write legislation to improve health care benefits for Medicare-eligible military retirees, and includes mandatory funding for both initiatives: $10.9 billion over ten years for Medicare Subvention, and $5.4 billion over ten years for prescription drug coverage. The prescription drug initiative is treated as an entitlement so it will not have to compete every year with other defense priorities for discretionary funds. The Military Coalition, which represents many different uniformed services and veterans' organizations and more than 5.5 million current and former members of the Armed Forces and their families, supports H.R. 3655 and has commended the Democratic budget for including this funding. The Military Coalition states that the military retiree health care provisions of the Democratic Alternative ``are important steps toward fulfilling the commitment of health care for life that was promised uniformed services retirees as an inducement to dedicate themselves to careers in uniforms.'' The entire text of their letter is included for the record. If the Democratic budget resolution is passed by the House, the following is the report language which will accompany our reconciliation directive to the Armed Services Committee: Report Language to Accompany Sec. 104 of The Democratic Alternative Budget Resolution Section 104 issues a reconciliation directive to the Armed Services Committee for $16.3 billion for the 2001-2010 period. The Budget Committee assumes that the additional funding made available will be used to extend and improve the Department of Defense health care system to Medicare- eligible retirees. The year by year amounts are as follows: For fiscal year 2001, $437,000,000; For fiscal year 2002, $699,000,000; For fiscal year 2003, $990,000,000; For fiscal year 2004, $1,426,000,000; For fiscal year 2005, $1,848,000,000; For fiscal year 2006, $2,069,000,000; For fiscal year 2007, $2,126,000,000; For fiscal year 2008, $2,184,000,000; For fiscal year 2009, $2,243,000,000; and For fiscal year 2010, $2,301,000,000. The Budget Committee believes these amounts are consistent with the provisions of H.R. 3655 that apply to Medicare- eligible military retirees. H.R. 3655, which was introduced by Reps. Neil Abercrombie, Ike Skelton, and Gene Taylor, is a comprehensive bill that addresses the health care needs of active duty personnel, military retirees, and their families. The active-duty provisions of this legislation that are funded within the President's budget are also accommodated within the budget resolution. Specifically, $10.9 billion is consistent with the funding required to meet the bill's provision to extend Medicare Subvention nationwide by January 1, 2006. In addition, $5.4 billion is to meet the bill's provision to provide access to the Department Defense's prescription drug programs for all retirees, including Medicare-eligible retirees. All of the funds are mandatory expenditures. The $10.9 billion is displayed in Function 570 (Medicare) and the $5.4 billion is displayed in Function 550 (Health). While the amounts provided by the Budget Committee conform with the major provisions of H.R. 3655, the Armed Services Committee has sole jurisdiction over this legislation, and may provide the benefits in the manner and function(s) it thinks best. Last year, even though the Democratic alternative did not pass, it provided the impetus to increase funding for veterans' health care by $1.7 billion. Win or lose, the Democratic alternative is a strong message to retirees and a strong step forward for the Abercrombie- Skelton-Taylor legislation. As a cosponsor of H.R. 3655, I hope the Democratic alternative will spur Congress to pass this important legislation. Alexandria, VA. March 23, 2000. Hon. John Spratt, Ranking Minority Member, House Budget Committee, O'Neill House Office Building, Washington DC. Dear Representative Spratt: The Military Coalition, a consortium of nationally prominent uniformed services and veterans organizations, representing more than 5.5 million current and former members of the seven uniformed services, plus their families and survivors, would like to express its gratitude for the proposed budget alternative that you introduced this week. We appreciate your leadership in proposing an additional $16.3 billion over the next ten years to improve access to military health care for the most aggrieved group--Medicare-eligible uniformed services beneficiaries. Although the Coalition would have preferred the House Budget to completely fund health care for life for retirees as provided for in H.R. 2966, we recognize that your budget proposal will provide for immediate and demonstrable progress toward this goal by providing funding for the TRICARE Senior Prime program and making the military BRAC pharmacy benefit available to all Medicare-eligible retirees. These are important steps toward fulfilling the commitment of health care for life that was promised uniformed services retirees as an inducement to dedicate themselves to careers in uniform. Again, thank you for your strong support, for which we are most grateful. It's our hope that you and other members of Congress will not stop with these first, substantial steps, but will continue to address this issue next year, and every year thereafter, until full equity is achieved for those retired members who have done so much to protect the democracy that their countrymen enjoy. Sincerely, The Military Coalition.

Mr. SPRATT. Mr. Chairman, I yield myself the balance of my time. I ask the gentleman from Ohio (Mr. Kasich) if I could borrow one of his charts. This is the chart I wanted to hold and borrow, because I think throughout this debate the gentleman sort of indirectly unwittingly complimented us. The only thing the gentleman got wrong on this whole chart is a GOP plan, because if the gentleman goes down the items on this chart, the gentleman will see that our budget resolution does everything the gentleman says, except we do it better. It protects 100 percent of the Social Security surplus. I just explained that. We have a $48 billion cushion that keeps you out of Social Security, strengthens Medicare with prescription drugs. We have reconciliation. We do not say report a bill that has structure reforms and then you can have the $40 billion. We say just do prescription drugs, get it done. Retire the public debt by 2013, we do it. Promote tax fairness, give us a break. We have got a $50 billion net tax cut. Read the language of it. We have the AMT correction in it. We have mitigation of the marital penalty in it. We have deductibility of college tuition in it. We have tax fairness and tax relief for families. Restore America's defense? Come on. There is one-tenth of 1 percent over the 5 years difference between what the gentleman is providing for defense than what we are providing for defense. Add in the $16.3 billion that we are providing for retiree health care, and we are way ahead of the gentleman. Finally, strength and support for education and science. We match you in science. And we are $20.5 billion ahead of you in education. You ought to vote for us. I rest my case and I yield back the balance of my time.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman from California (Mr. Matsui) for yielding me this time. Mr. Speaker, I rise in full support of this bill, the retirement earnings test is an old vestige of the 1930s, created when Social Security was born as a way of telling who was truly retired and, therefore, qualified for benefits. It was looked upon as good policy then because it spurred older workers to stop working and take their Social Security benefits and, therefore, freed up jobs for younger workers in what was then, the 1930s, a period of high unemployment. Today, we do not have a labor surplus in most parts of the country; we have a labor shortage. For example, I had an owner of a trucking company call me a few months ago and tell me in desperation that this offset policy in Social Security was causing him to lose drivers. They would not work upon reaching the age of 65, and he could not replace them. He saw no reason for this policy, and I can tell from talking to other workers in my district neither do they. We can explain all the reasons behind it, going back to 1935, but most people see this as a stiff, unfair, tax on hard-working people. I think it is time for us to repeal these offsets all together for those people who have reached retirement age. The question arises: Why did we not do this in 1998? There has been some accusation here that some of us who voted for that particular tax bill then, which was an $8.1 billion tax bill in 1998, voted against the elimination of the threshold. That bill would not have eliminated the threshold. It would have raised the threshold to $39,750 by 2008. But in 1996, almost all of us came out here and voted for H.R. 3136, the Senior Citizens' Right to Work Act of 1996. This bill raised the limit in annual steps from $12,500 to $30,000 by 2002, and indexed the threshold after 2002 to rise with the rate of inflation. Had we simply followed the course of that law, by 2008, the threshold would have been about $38,000, just a little bit less than the bill in 1998 provided. So this argument is really not a fair argument. I am glad to see us bring something to the floor that is bipartisan. Let us keep it bipartisan. I do not think I need to encourage anybody to vote for this. The vote is going to be overwhelming. And any time we get this kind of bipartisan consensus on an issue of this substance, it is a sign of an idea whose time has come. Mr. Speaker, I think it is right that we repeal today, right now, as soon as possible, this old and outdated vestige of the Social Security system and say this is something on which we all agree.

Mr. SPRATT. Mr. Speaker, I did not hear the bells on rollcall 27. I spoke in support of the bill, H.R. 5, and I would have voted in favor of the bill had I been present.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman from Massachusetts (Mr. Moakley) for yielding me this time. Mr. Speaker, Members should know that if they vote for this rule, they vote to violate the Congressional Budget Act of 1974. They vote to discard the discipline that has brought us from $290 billion deficits to $125 billion surpluses. For 25 years, section 303, black letter law of the Congressional Budget Act, has wisely provided that Congress shall not take up major tax cuts of this magnitude or for that matter major spending increases without first adopting a budget resolution. That has been the procedure for 25 years, and for good reason. It requires to take something of this magnitude and put it in the framework of a budget and face it off against competing alternatives. By not doing that, the result today will be, if we pass this bill, pass this rule, a bill that will drain $182 billion off of a surplus of about $800 billion. Twenty-five percent of the surplus will be disposed of today in one fell swoop without considering other things that we could have done for it. Now, the rule serves a purpose. It is not some arcane rule. It says, do not do something of this magnitude, either on the tax side or the spending side, in isolation. Do it comprehensively. Consider other alternatives. Do it and see what the trade-offs of doing it are. I want to defang the marital penalty as much as anybody else. I will gladly vote to do it, but we can vote for it by voting to double the standard deduction, cost about $44.8 billion, and then do something else. The families who are faced with this so-called marital penalty will soon be faced with the AMT, the alternative minimum tax. We never meant for them to be confronted with the AMT. That problem can be fixed, too. The cost is $32.8 billion, a total of $77 billion. Then there is $105 billion left over. For that $105 billion, we can do Medicare prescription drug coverage per the President's proposal over the next 10 years, or we can go to the President's proposals for tax cuts this year and we have a whole list of things to do. We can expand tuition tax credits. We can provide for school construction bond subsidies. We can fix the EITC. We can expand the child care tax credit. Surely that is pro middle-income family, working families. We can add to the long-term care tax credit, a tax credit of $3,000; and we still have enough left over to do the President's proposed retirement savings account. All of this can be done in addition to fixing the marital penalty and also fixing the AMT. That is what is wrong. That is what is out of place with this rule. It violates the Congressional Budget Act. It requires us to do something in isolation ad hoc, and what this will lead to is ragged results. Lots of stuff left on the cutting room floor that has not been fairly considered. There is a better way of doing this. I am for the marital penalty correction but I am for doing it in the proper way.

Mr. SPRATT

Mr. SPRATT. Mr. Speaker, I thank the gentleman for calling this special order.

Mr. SPRATT. Mr. Speaker, I think it is in order just to take a minute to say we have every reason to be celebrating our success. Three times in the 1990s we stood up to the problem of the deficit which had plagued fiscally the 1980s: In 1990, when we passed the Bush Budget Summit Agreement; in 1993, Democrats only, just our side of the aisle, one vote would have made the difference, we put on the board the votes to pass the Clinton Deficit Reduction Act. And then, in 1997, we came around to finish the job. As it turned out, the deficit was already down below $25 billion that year. But we wiped that out and went on to put the Government on a fiscally even keel for the next 5 years. And now we are enjoying the fruits of that and we ought to celebrate it. Last year, for the first time in 30 years, we had a surplus of $70 billion. This year, when we closed the books on fiscal year 1999, we had a surplus of $125 billion. Now, that is using the yardstick that we have used since 1969, including all expenditures, all revenues of the Federal Government, and so-called unified or consolidated budget. If you back out Social Security, the biggest account in the budget, this year, for the first time in eons, we are just about in balance without including Social Security, a billion dollars in a budget of a trillion, 800 billion dollars. We are just about in balance with our Social Security. So we developed a new objective. Just as we were crossing the goal line, we moved the goal post back. We said, ``It's not good enough to balance the budget using Social Security. Let's balance the budget without using the surpluses in Social Security and let's not borrow from the Social Security trust account in the future.'' The President was the first to propose that we use the Social Security surpluses to buy down debt held by the public, outstanding Treasury debt. The benefit of that would be if we dedicate ourselves completely to it over the next 10 years, we would retire $1.8 trillion in debt, half the outstanding debt held by the public of this country. And then over the next 15 years, we could retire nearly all of it, more than $3 trillion of publicly held debt. Then in 2020, 2024 when the Administrator of Social Security has to take those bonds which he holds as trustee and liquidate them, cash them in so he can meet benefit payments, the Treasury will be in better shape fiscally than ever to roll the bonds and pay the debt because it will have very little debt held by the public at that point in time. This is a fundamentally important thing, and basically both parties are coming together on trying to do that as one of the legs in the stool that will keep Social Security up. So this year we said we would like to stay out of the Social Security surplus. My colleagues on the other side said they were going to do that. The problem is they really have not shot squarely with the budget that they presented on the floor. And so I wrote Mr. Crippen, Dr. Crippen, a Republican appointee, a good man, he has a Republican partisan background, he is their appointee to head the Congressional Budget Office, CBO, supposed to be neutral and nonpartisan. It is our budget shop. I asked him since he is the scorekeeper, he is the umpire, he is the arbiter in these matters and they are the experts with a good track record of predicting the effects of legislation that we pass around here that we call the budget, the 13 appropriations bills that make up the annual budget, give me the latest, give us the latest update. When you have passed the 13th of these 13 bills, tell us where we stand. He wrote me back a letter telling it like it is. He said, Dear Mr. Spratt, look at table 1. Total spending in these 13 different appropriation bills by our calculation, and that is outlays, that is dollars actually spent in fiscal year 2000, the year that we are in right now, will come to $614.1 billion. He said if you apply an across- the-board cut of 1 percent to that, you will whittle off about $3.5 billion of it, leaving a net of $610 billion. He said in 1997 when you did the balanced budget agreement of 1997 and you capped discretionary spending, the cap or ceiling that you put on discretionary spending this year was $579.8, $580 billion. If you spend $610 billion which is what these 13 bills did, according to Dr. Crippen, you are $30.7 billion over and above those discretionary caps. That is the first violation. Secondly, more importantly, when you go $30 billion over, you have got a $14 billion surplus out there that we project for fiscal year 2000. That surplus would obtain if you hit the target of $580 billion in total spending. But if you are $30 billion over it, then you will use up the $14 billion surplus and be $17 billion in deficit. That deficit will have to come out of Social Security. That means that you will be $17 billion into the Social Security account. That is the straightforward accounting of the matter. No way you can cover that up. They tried to dispense with it with what we call scorekeeping gimmicks, delayed obligations, advance funding, all of these different things, there is a lengthy list of them provided, and they are all shams. The truth of the matter is right here. Dr. Crippen told it the way it is. They are $17.1 billion into the Social Security trust fund as a result of bills that this Congress passed under the majority leadership of the Congress in the House and the Senate.

Mr. SPRATT. Mr. Speaker, I would like to make a point that is a little different from the one the gentleman has been on, and that is we achieve these budget surpluses with real budget discipline. Among other things, we impose cost curbs and controls, discretionary spending ceilings, for example, that have held spending down for the last 10 years. As a consequence, we have reduced spending in the Federal budget to where today it is about 19 percent of the total economy. In other words, out of every dollar this economy produces, the Government takes a bite of about 19 cents. As recently as the mid-1980s, in the peak pinnacle of the Reagan years, we were spending, the Federal Government, as a percentage of GDP, 23.6 percent, as opposed to 19 percent going to 18 percent in a few years under the budget we have now in place, 3 to 4 percentage points less than we were spending just 15 years ago. Now, why is that significant for Social Security? In order to pay for the long-run cost of Social Security, once the ratio of those working to those retired drops to about 2.2 to 1, we will need to shift resources out of our GDP into the Social Security program, because we have lowered spending. We will need to shift about 2.7 percent maximum of our total economy in order to fund the peak demands of the Social Security system after the baby-boomers fully retire. Because we have adjusted spending, we have laid the basis, the foundation, for making that adjustment in the future, another way that we position ourselves to finally stand up to this problem, address the problem, rise to the opportunity, and it will be a shame if we blow this opportunity and do something else before we have saved and made Social Security solvent for the long run, because it is bedrock for 40 million Americans, and it will be bedrock for millions more before our work is done.

Mr. SPRATT. If the gentleman will yield, to the discipline of the budget rules that have brought us from a $290 billion deficit 7 short years ago to a surplus this year, measured by the same technique, of $125 billion. Rules, processes, procedures have helped us travel that far in this period of time. If you undercut and trash those rules, we will soon lose what we have accomplished.

Mr. SPRATT. Dr. Crippen sent me two tables in response to my request. Under his letter of October 28, he said, CBO has also calculated the across-the-board cut that would be necessary to eliminate the estimated on-budget deficit, the deficit without Social Security, for this year under two scenarios. Table 2 presents their estimate of what would be necessary in the way of across-the-board cuts to wipe out this deficit of $17.1 billion that otherwise will come out of Social Security. He said, if you cut completely across the board, defense, veterans, everything, it will take a 4.8 percent across-the-board cut, not a .97 percent cut but a 4.8 percent. Now, he said if you cut 4.8 percent, you are going to wipe out the pay raise and everything that you have provided for personnel this year, important initiatives in the defense bill. Your initiative to get $1.7 billion of additional funding for veterans health care will be largely wiped out. So if you exclude veterans health care and if you exclude defense programs, the across- the-board cut would have to be 10.8 percent, not 1 percent or .97 percent. It would have to be 10.8 percent. So the whole 1 percent across-the-board cut is a ruse. According to the Director of the Congressional Budget Office, Dr. Dan Crippen, the minimal cut would be 4.8 percent in order to rectify these books and stay out of Social Security.