Christopher Shays

Mr. SHAYS

Mr. SHAYS. I would like to just emphasize this point though. The bottom line is that the White House, when they were presenting their plan on Medicare, suggested that Medicare could only grow at 6.8 percent a year; that we needed to slow the growth. That is what we are doing. Admittedly, we failed to keep it as low as the White House originally suggested and it is going to grow at 7.2 percent. And now we had basically four ways to make these savings generically. One is we could change and affect beneficiaries. The second is we could change and affect providers. The third is we could raise taxes to save the Medicare trust fund part A, and that simply was ruled not an option. And the fourth is we could change the system. I would love to get into the whole issue of how we are looking to change the system, but first before yielding I will make this point: We did not advocate making any change in copayments. We did not advocate, and do not, any change in the deduction. We do not advocate changing the beneficiary rate, the premium rate on the Medicare part B. We leave that at 31.5 percent, with the taxpayers still paying 68.5 percent. Now, Medicare part A, which is going bankrupt is the hospital payments. Medicare part B is the services. In Medicare part B, we keep the premium, the cost to the beneficiary, at 31.5 percent. As health care costs go up, that 31.5 percent will continue to be a higher amount, much as it has been in the last 7 years. That will be that gradual increase. I would love to later on, but I will yield to my colleague, I will just point out that in the year 2002 the President basically would have a premium of $82.80, at 25 percent of the cost, because the President fails to slow the growth of Medicare, and at 31 percent of the cost, our charge is only $87.50. It is less than $4 and some change, the difference in the premium cost, and yet the President has called this Draconian. The bottom line is I would love my colleague to talk about what we have done. We have not increased the copayments. We have increased deductions. We keep the beneficiary rate at 31.5 percent.

Mr. SHAYS. But still allowing, if the gentleman would yield.

Mr. SHAYS. Ultimately, this Government is going to be shut down until the President doe his job and provides this Congress with his balanced budget. That is a fact. It is not something that either you or I like, but we know what the cause is. This is the cause that only happens and an opportunity that only happens once in a lifetime. For over 30 years, particularly since the end of the Vietnam war, our national debt his gone up from over $300 billion to $4.9 trillion or $4,900 billion, and that has happened in peacetime. Both the gentleman from Iowa and I and other Members, particularly on this side of the aisle, want to put an end to that. We want to end the deficits so we have lower interest rates; so our mortgages cost us less; so our car payments cost us less; and so that businessmen and women, when they want to invest in new plant and equipment to make their workers more efficient and more productive, do not have to pay so much for the cost of money to invest in new plant and equipment. What I would like to do is I would like to get into one particular issue to illustrate what we did during the last 11 months, and that was the whole issue of Medicare. We know that Medicare is going up from $178 billion to $289 billion. first off, we know that Medicare is going bankrupt. It becomes insolvent starting this year. Less money is put in the fund than goes out the first time ever in Medicare Part A. We know it ultimately starts to go insolvent and becomes bankrupt in the seventh year. With our Medicare plan, we are looking to spend a considerable amount more in the next 7 years than we did in the last 7. We spent in the last 7 years $926 billion. We are looking to spend $1.6 trillion. $1.6 trillion. We are going to spend $727 billion more in the next 7 years than we did in the last 7. On a per capita basis, we are going to go from $4,800 per beneficiary to $7,100. and it is important to say ``on per beneficiary,'' because people are saying ``You are getting more people in the system.'' Yes, even with more people in the system, we are still going to spend 45 percent more for each of those individuals.

Mr. SHAYS. If the gentleman would yield, I watched the President give his press conference yesterday and he said Republicans are trying to basically ram down our proposal, which is simply not true. Because we are not saying that he has to present our proposal. We are saying he needs to present his proposal with his priorities. For instance, if he wants no tax cut, he can submit a budget with no tax cut. If he wants more spending on Medicare or Medicaid, he can do that. The only requirement is that it be balanced, scored by real numbers. So, that is the issue and it is simply not true.

Mr. SHAYS. And you want him to do What?

Mr. SHAYS. So it has been since November 20 and the President made it very clear that we would balance the budget using the Congressional Budget Office numbers. And what has happened since then? Has he submitted a budget? Has it been scored by the CBO? And the answer is no. That is really the point that we find ourselves. We have been authors and we have authored since January and we have struggled and debated and made decisions on Medicare and Medicaid; on the school lunch program; yes, on taxes as well. We set out priorities, and now we want the President to tell us what his priorities are. Instead, he has been a critic on the sidelines saying what he does not like, and not an author, and we are asking him to be an author. The challenge we have right now is the Government shutdown. Why is it shut down?

Mr. SHAYS. Did we get any that we wanted?

Mr. SHAYS. Mr. Speaker, if the gentleman would yield, that is the key point, that we compare the same basic accounting numbers. And Mr. Dreier is right on target, the President was right behind you saying use the Congressional Budget Office numbers. Congressional Budget Office is not bipartisan. It is not partisan, it is nonpartisan. These are not political appointees like the Office of Management and Budget.

Mr. SHAYS. Mr. Speaker, I am happy to be joined by the gentleman from Iowa [Mr. Ganske]. Mr. Speaker, I was elected to the State House of Representatives in 1974, and it never ceased to amaze me, when I saw my colleagues in Congress having to form a budget, that they did not have to balance the budget. It never ceased to amaze me that unlike the State house, where our revenues had to equal expenditures, men and women in Congress continued to deficit spend and put us in an incredible hole of obligations. Mr. Rabin, before he was assassinated, said that he was elected by adults to represent the children and the children's children. And this is what this issue is all about. We have Federal employees who are innocent victims, but, ultimately, they will be paid. But they have to now survive without pay. They are caught in the middle. But this is not about Federal employees. This is not even about the disruption of services. It is about whether or not there is an agreement in Congress with the White House to finally balance our Federal budget, get our financial house in order, Save Medicare from bankruptcy and, ultimately, to change this social and corporate welfare State into what I would refer to as an opportunity society, an opportunity for all Americans. So, Mr. Speaker, we are gathered here now in a very significant debate. I have differences with my colleagues on the other side, as I am sure others of my colleagues on this side of the aisle have. We are trying to get our financial house in order and balance our Federal budget. We presented a budget that we worked on for 11 months. Our budget, in some cases with discretionary spending, which is the running of Government, the various departments and agencies, we made real reductions. We spent less in some programs and departments than we did in this year's budget. We eliminate a department, we reduce the size of other departments, we consolidate agencies, and we attempt to, in a 7-year plan, balance the Federal budget. In terms of entitlements, which are half of our Federal budget, we are looking to slow the growth of entitlements. We are not cutting them; we are spending more. I am just going to read the expenditures of five programs that our colleagues just previously made reference to. They called it cuts. Only in this place, in this city of Washington, when you spend so much more do people call it a cut. The earned income tax credit is a credit that goes to people who do not pay taxes. It is an assistance to the working poor, and we are told that we are cutting it when we go from $19.9 billion to $25 billion in the 7th year. That is an increase of 20 percent, and yet our colleagues call it a cut. The School Lunch Program, which they went to schools and told the children they would no longer have a school lunch program. What an outrage. That program goes from $5.1 billion to $6.8 billion. Our Student Loan Program, we are told we are cutting the Student Loan Program, and it goes from $24.5 billion to $36.4 million, a 50-percent increase in student loans. Only in Washington when you spend 50 percent more do people call it a cut. And then, before yielding to my colleague, the gentleman from Iowa [Mr. Ganske], I will just make reference to two very important programs, I know to Mr. Ganske, and certainly to me as well, because we worked on these programs very closely. Medicaid. This is health care for the poor. We go from $89 billion now to $127 billion. Only in Washington when you go from $89 billion to $127 billion do people call it a cut. And then with Medicare, we go from $178 billion to $289 billion. I would love to just make reference to some very specific points in this program. The bottom line to this program is that when we talk about it, we are going to go on a per capita basis from $4,800, in this past year, to $7,100 in the year 2002, which is now 6 years from now. Now, that is a 45-percent increase per capita, and yet I am told that is a cut. We are allowing Medicare to increase on an annual basis of 7.2 percent, and yet I am told by my colleagues on the other side of the aisle that that is a cut. I have a difficult time with that. It is not a cut, it is a significant increase. Admittedly, it is not a 10-percent growth, it is a 7.2-percent growth each and every year. I know my colleague, who happens to be a doctor, is very near and dear to the concerns of Medicaid and Medicare. Medicaid is health care for the poor. And also Medicaid is nursing care for the elderly poor. Medicare, which is health care for the elderly and the disabled, these are two very important programs that we are trying to save. I would love at this time to yield to my colleague to discuss whatever he would like as it relates to these issues.

Mr. SHAYS. Mr. Speaker, I understand I have 55 minutes and the gentleman from New York [Mr. Owens], the gentleman after me, has 55 minutes?

Mr. SHAYS

Mr. SHAYS. Mr. Speaker, we spend a billion dollars a day just on interest on the national debt. We are elected by adults to represent the children and future generations. We have the opportunity of a lifetime to balance our Federal budget and to get our financial house in order. Since the Vietnam war the national debt has gone up from $300 billion to $4,900 billion, $4.9 trillion. This is not about Federal employees. This is not about the disruption of some Federal services. It is about finally, once and for all, and for the good of our children and future generations, balance the Federal budget in 7 years using honest numbers. Taxes are on the table. Spending is on the table. Even defense is on the table. The budget must be balanced and it must happen at least within 7 years.

Mr. SHAYS

Mr. SHAYS. Mr. Speaker, I was elected to the statehouse in 1974 and began service in 1975 and I could never understand how Congress would be able to spend more than it raised in revenues and deficit-spend. I knew that on the State level we had to balance our State budgets. I vowed when I was elected in 1987 that my first priority would be to get our financial house in order and be part of that effort. There was a small group of us, only 30 at the time, who voted for a budget that the gentleman from Ohio [Mr. Kasich] introduced which began to do that, and each year we saw that number increase. Finally this year we saw a Congress that over 300 Members voted for a balanced budget amendment. But it would be kind of silly to vote for a balanced budget amendment and not be willing to vote to balance the budget, and we set out to balance the budget. It was a long and an arduous task in which we spent the last 11 months to in fact balance the budget in 7 years. We submitted that budget and it was vetoed by the President. We are asking the President of the United States to do the same kind of heavy lifting that we have done and tell us where his priorities are and where he would spend and where he would cut. I do not disagree that the President might have a problem with where we spend on Medicare, Medicaid, school lunch, student loans. He may have differences. He may not agree with the tax cuts that we have suggested in the next 7 years, all of those are issues that are open for dialog and debate and need to be debated. The issue is, when? When is he going to submit his balanced budget, a budget balanced in 7 years, scored by real numbers of the Congressional Budget Office, which is not a partisan office, it is not a bipartisan office, it is a nonpartisan office. And so we are now in a position where the President has, which is his privilege, the ability to take the 13 different budget items and agree to the ones that we have passed, and the 13 budget items, any of those that he does not agree with, he can veto. He has vetoed the Interior bill, the Commerce, Justice and State and the VA-HUD bill. My colleague was right in pointing out that the Veterans Administration is not functioning. It is not functioning because we provided a budget and the President decided to veto it. We have not yet presented him the Labor-HHS bill. That is in the Senate and is now filibustered by my colleagues on the other side of the aisle who are in the Senate. We have not given him the District of Columbia bill and the Foreign Operations. But all the other bills we have given him. So we have a shutdown. I contend that this is not an issue of Federal employees or even the reduction and disruption of some services. It is an issue of whether finally after 30 years of deficit spending we are going to get our financial house in order. When I was first elected to the statehouse, our debt was $350 billion. Our debt has grown now to $4.9 trillion. It is about whether we finally, after so many years, are going to get our financial house in order and balance the Federal budget and in the process save our trust funds, particularly Medicare, from insolvency starting this year and bankruptcy in the seventh year. We have heard criticism of our budget, that the earned income tax credit, a credit that goes to people who pay no taxes, is being cut and yet we know it is going from $19.9 billion to $25 billion in the next 7 years, the school lunch program, which under our plan goes from $5.1 billion to $6.1 billion, or our student loan which goes from $24 billion to $36 billion. Only in this place when you spend 50 percent more like on the student loan program, going from $24 billion to $36 billion, do people call it a cut. Or Medicaid that is going from $89 billion to $127 billion. Or Medicare which is going from $178 billion to $289 billion. We have put in tremendous new money under our Medicare program. For instance, it goes from $4,800 to $7,100 per beneficiary in the 7th year, a significant increase. Ultimately we have a disagreement with the President on Medicare and Medicaid. He may have other priorities. The simple fact is this Government would get started in 6 hours, those parts that need to be funded that are not would be funded in easily 6 hours if the President did one thing that he promised to do at Thanksgiving, and I thought when the President gave his word, he meant to keep it, and he gave his word that we would balance the budget in 7 years using real numbers. We are still waiting for his balanced budget proposal. I know the Government is shut down, but I know ultimately that we are going to have to get our financial house in order, and I am willing to stay as long as it takes to do that.

Mr. SHAYS

Mr. SHAYS. I am struck by the fact that the gentleman points out that we cannot continue to allow mandatory spending to continue to grow and grow. They cannot be sustained. As they grow, it crowds out discretionary spending, though discretionary spending is where you and I and other Members on both sides of the aisle actually have to make choices.

Mr. SHAYS. I vote on a third of the budget. Gramm-Rudman, which was attempting to get our financial House in order, only focused in on discretionary spending, so while we tried to control the growth of discretionary spending, nondefense and defense spending, we had entitlements just continuing to grow, and what to me is most alarming, interest on our national debt is about 15.3 percent. What it seems from looking at that chart, I am just wondering if the gentleman could project this out beyond the year 2002, and tell me if we do not deal with this challenge, what is likely to happen.

Mr. SHAYS. Mr. Speaker, I would love to get the gentleman's chart 3 beside him, because to me it just raises a very interesting point as it relates to democracy. Mr. Speaker, as I read it, and I would love the gentleman to comment, as I look back in 1955, it is fairly clear that nearly 90 percent of all expenditures are what we call discretionary spending, spending that was voted out by the Committee on Appropriations, and that what we call mandatory spending, entitlements, interest on the national debt, was close to 20 percent. We vote on what we call the discretionary spending, then. What my colleagues seems to point out is that sometime, I gather, in the 1970's or a little beyond, at that point mandatory spending overtook discretionary spending with, I think, tremendous significance, because I was elected 8 years ago. I do not vote on 50 percent of the budget. It is on automatic pilot. In fact, I do not vote on 60 percent of the budget, basically.

Mr. SHAYS. Mr. Speaker, will the gentleman yield?

Mr. SHAYS. I serve on the Committee on Government Reform and Oversight. We have oversight of HHS, and it was described to me by one of the planners, an undersecretary, that when HHS also included Social Security, its total budget was larger than the gross domestic product of Canada, an astounding thought, that here we had this Government agency that spent more money than all the gross domestic product of Canada. Mr. Speaker, I would just thank the gentleman for his presentation, both in terms of liabilities, which ultimately are continuing to grow, and something we have not even begun to address. But what we are trying to do in this 104th Congress' first session is to slow the growth of mandatory spending, to start to make choices about what parts of our society should get resources. I thank the gentleman.

Mr. SHAYS

Mr. SHAYS. Mr. Speaker, the gentleman's analogy of leaving the old world for the new world, I just want to make this point. We have left the old world for the new world, and we are not going back to the old world. We have burned our ships. We are in this new world, and we are determined to save this country from bankruptcy. I thank my colleague for yielding to me.

Mr. SHAYS. Mr. Speaker, will the gentleman yield?

Mr. SHAYS

Mr. SHAYS. Mr. Speaker, it is one of the greatest privileges in the world to serve in Congress and represent constituents who have sent you to Washington. I have had the pleasure as well to represent a smaller constituency in the State House in Hartford, and it never ceased to amaze me, as a State legislator, how I as a State legislator had to make sure that our State had its financial house in order, and yet the Federal Government could deficit spend. I often wondered how those men and women in Congress could do such a terrible thing to our country, to burden future generations with horrific debt, on which we have to pay annual interest payments which are in excess of over $235 billion annually. Mr. Speaker, when I got down to Washington I vowed that getting our financial house in order would be my first and highest priority, making sure that we balanced our Federal budget. I have seen during the past 8 years that there has been here a greater awareness that we needed to do this and more and more Members willing to put their, candidly, political lives on the line to do that. I pay special salute to the freshman class that have joined us this year, because this number of 73 Members has given us the opportunity to lead. We have not had an opportunity as a Republican conference to lead in 40 years. What we have done in that short period of time, Mr. Speaker, I think is extraordinary. We passed major reforms in the first day of the session by reducing the size of Congress, reducing the number of committees, reducing the staff on committees, requiring or no longer allowing proxy votes, requiring all committee meetings to be open to the public, requiring that Congress live under all the laws we impose on everyone else. I want to say that again; to require Congress to live by all the laws that we impose on everyone else. Mr. Speaker, we not only voted during the beginning of the year for a balanced budget amendment, but we did something obviously more important, we voted to balance the budget. That is what I want to address at this point. Mr. Speaker, we are going to get our financial house in order and balance our Federal budget. At the same time we are going to save our trust funds, particularly Medicare, from insolvency and then ultimately bankruptcy. Our Medicare fund will go bankrupt if we do not take corrective action to restore funds in the Medicare Part A fund, which will go bankrupt in 7 years. We are looking to transform our caretaking social and corporate welfare state into a caring opportunity society. We are set to do all three of these objectives, and we are working hard to accomplish that task. Mr. Speaker, Prime Minister Rabin, who was the former prime minister in Israel, made it very clear that he viewed his responsibility this way. He said he was elected by adults to represent the children. That is what I think Members in Congress have to do. We are talking about not having a horrific debt that mortgages our country's future. We have a plan. The plan is very simple: We balance the budget in 7 years. Admittedly, we have a tax cut. What do we do? We balance it in 7 years. I could forego a tax cut if we balance the budget in 6 years, but I will be darned if I am going to reduce the tax cuts and then take what we had saved to allow for tax cuts and just spend more money. We are allowing this Government to grow. In the past 7 years we spent $9 billion. We are going to spend $12 billion. The issue is should we spend $13 billion in the next 7 years. We say no. The other issue is we say it should be balanced by the seventh year. Mr. Speaker, I constantly hear about Republican cuts to the budget. They are just not true. At least they are not true when they refer to the earned income tax credit, a very important program to provide proactive financial assistance to individuals who do not pay taxes, but work. The earned income tax credit grows from $19.9 to $25.4 billion. The school lunch program under our plan grows from $5.1 to $6.8 billion. The student loan program grows from $24.5 to $36 billion. That is a 50-percent increase. Only in this place when you spend 50 percent more do people call it a cut; Medicaid, growing from $9 billion to $127 billion, Medicare from $178 billion in the seventh year to $289 billion. That clearly is an increase in spending. Mr. Speaker, we are cutting some programs, and maybe some we should not, but we had to make choices. Now it is up to the President. We have spent a whole year working on our budget. We have closed it and advertised it, and have proclaimed it to our constituency and the entire United States. Now it is time for the President to say where his priorities are. A member of our conference pointed out that we have been authors and the President has been a critic. It is important now that the President be an author of what he favors and show us what he wants, and then compare the two options. I think we can have an agreement on 24 hours, as soon as the President and the leaders in the Democratic side of the aisle, the gentleman from Missouri [Mr. Gephardt] and the gentleman from South Dakota [Mr. Daschle], determine that the American people want to balance the budget in 7 years and get our financial House in order. We are not asking that they agree to what we are doing with Medicare and Medicaid or the tax program or our discretionary spending. We are asking them to present their plan, see where we agree and, where we agree, case closed. Where we disagree, then iron out our differences. Ultimately, the President is the President of the United States. He is going to have to pass judgment on what we do. There will have to be an agreement. But rather than compromise, we are looking to find common ground and save this country from bankruptcy. We are determined to get our financial House in order and balance the Federal budget. We are determined to save our trust funds, particularly Medicare, from bankruptcy. We are determined to transform this social and corporate welfare state into an opportunity society and end this cycle of 12- year-olds having babies, 14-year-olds selling drugs, 15-year-olds killing each other, 18-year-olds who cannot read their diplomas, 24- year-olds who have never had a job, and 30-year-old grandparents. That has to end. We need to transform this society into truly what is an opportunity society. I look forward to doing that, and working with colleagues on both sides of the aisle to accomplish that task. Mr. Speaker, I would just conclude by saying I am proud to serve in this incredible opportunity as a Member of Congress, and to represent the people of the United States.

Mr. SHAYS

Mr. SHAYS. Mr. Speaker, I would like to respond to my colleague and say to him that this is about everything that is important. I have waited 8 years to see my Government finally balance its budget and get its financial house in order, and that is what we are attempting to do. We are attempting to do three basic things. Get our financial house in order, balance our Federal budget, is one. The second issue is to save our trust funds, particularly Medicare, from bankruptcy. It starts to become insolvent next year and becomes literally bankrupt in 7 years. The third thing we intend to do and are working very hard to, is to change both the social and corporate welfare state into a caring opportunity society. That is our objective. I know my colleague feels very heated about this issue, but it is really a distortion to talk about cuts to education when education loans are going to go from $24 to $36 billion. That is a 50-percent increase in education loans.

Mr. SHAYS. If I could just make some points first. Then if I have some time, I would be glad to. Again, let me say that we intend to have this go from $24 to $36 billion. Only in Washington when you spend 50 percent more on student loans do people call it a cut. Our Medicaid number is going to go from $89 to $127 billion. Again, only in Washington when you spend so much more do people call it a cut. We are increasing the school lunch program. We are increasing the student loan program. We are increasing Medicare, we are increasing Medicaid. We are absolutely determined, and this is not something which one part of our party feels strongly about, we, this Republican Conference, have been working all year long to balance our Federal budget. That is what we are going to do. We are going to get our financial house in order. It is just amazing to me that we have had such a struggle throughout the year.

Mr. SHAYS. No. I will not yield yet. I will be happy to yield later if I have time. I only have 5 minutes. I do want to make the point and I think it is very important to be made. We are not saying that it has to be the Republican balanced budget. We do not even come close to saying that. Yes, we would like to see tax cuts, if it is going to be extended over 7 years. I would be happy to give up any tax cut if we balance the budget in 5 years, but if it is going to take 7 years, I cannot understand why we cannot balance the budget in 7 years with a tax cut. Balance it in 4 or 5 years without a tax cut, it makes sense. It does not have to be our spending priorities on discretionary spending. Obviously the President and this Congress, Democrats and Republicans, have to weigh in. It is just wrong, in my judgment, for anyone on that side of the aisle to suggest that it has to be our budget. No, it does not. It just has to be balanced in 7 years using the nonpartisan numbers of the CBO. I would be happy to yield to the gentleman from New York.

Mr. SHAYS. Reclaiming my time, the gentleman needs to recognize that we need to make it solvent for many more years, and we want to bring it up to the year 2010, 2011, which is the start of the baby boomers. Your plan brings it to solvency for a few more years but does not get it up to the year 2010, which is our objective. We want to balance our Federal budget, we want to save Medicare, and we want it to be solvent to the year 2010. I would be happy to yield to my colleague.

Mr. SHAYS. Mr. Speaker, reclaiming my time, and I plead this not be used against my time. It is very simple to respond. I wish that 10 years ago this Congress had shut down the Government and balanced our Federal budget, and we would not be in the mess we are in today. Our big regret on this side of the aisle is that we gave the President 30 days to come forward with a balanced budget and he chose not to. That is the bottom line to this issue.