[Pages S1152-S1187]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

BALANCED BUDGET AMENDMENT TO THE CONSTITUTION

The PRESIDING OFFICER. Under the previous order, the Senate will now
resume consideration of Senate Joint Resolution 1.
The clerk will report the pending business.
The bill clerk read as follows:

A joint resolution, S.J. Res. 1, proposing an amendment to
the Constitution of the United States to require a balanced
budget.

The Senate resumed consideration of the joint resolution.

Pending:
Durbin Amendment No. 2, to allow for the waiver of the
article in the event of an economic recession or serious
economic emergency with a majority in both houses of
Congress.

Mr. SPECTER addressed the Chair.
The PRESIDING OFFICER. The Senator from Pennsylvania.
Mr. SPECTER. Mr. President, I have sought recognition to speak in
favor of the balanced budget amendment.
Mr. President, this amendment has come up repeatedly during my tenure
in the U.S. Senate, and I have consistently supported the balanced
budget amendment because of my deep-seated view that the Congress needs
this discipline if we are to balance the budget on a permanent basis.
It is a very fundamental principle that people ought to live within
their means--if you or I do not, we end up in the bankruptcy court--and
that governmental entities must live within their means. The only
exception to this issue of living within one's means has been the
Government of the United States of America, which goes into further
debt each year with deficits of $100 billion or $200 billion, or more,
establishing a national debt in excess of $5 trillion.
This issue came into sharp focus for me recently when my wife and I
were blessed with two grandchildren. We would certainly never think of
imposing our financial obligations on our grandchildren, or spending
money on their credit cards for them to pay at some later date. But
that is precisely what we have done as a society. We have undertaken a
variety of methods to try to move toward a balanced budget with Gramm-
Rudman and the so-called automatic sequestrations. That did not work.
Nothing has worked, which is why I believe, in the final analysis, we
need to move to the balanced budget amendment.
We had the vote last year, coming within one vote of having the
amendment pass. The President is opposed to the balanced budget
amendment. But I do believe that just the pendency of the amendment has
been a very substantial impetus moving the administration, the
President, and the Congress to balance the budget without a
constitutional amendment.

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President Clinton has laid before the Congress and the country what
he submits is a plan to balance the budget by the year 2002. But the
reality is, upon looking at the fine print, that it is unlikely to
achieve that result because most of the cuts are in the last 2 years.
When we come to that point, there is the inevitable impetus to
eliminate those cuts. But to the extent that the pendency of the
balanced budget amendment will move us to balance the budget without an
amendment, that is so much to the good. Ideally, it would be preferable
if we could balance the budget without having a constitutional
amendment. But regrettably, that has not been our experience.
It is always difficult to turn down worthwhile programs for Federal
Governmental expenditures, and it is very, very difficult, painful, and
really, at the present time, impossible to have tax increases with a
Congress that is controlled by the Republicans and, I think, properly
declining to even entertain tax increases. So when we do have the
mandate of a balanced budget, it is apparent to everyone--it is
apparent to all 535 Members of Congress, and it is apparent to our
constituents. How frequently have we all heard the cry or the comment
of a constituent coming to see us, ``I have a very important program
that is meritorious and ought to be financed,'' and, at the same time,
insisting that the taxes not go up and that the budget be balanced?
I think it is important, Mr. President, as we go over this balanced
budget amendment, that we allow sufficient flexibility for our
Government to respond in times of crises or emergency. I share the
concern that the distinguished Senator from Illinois, Senator Durbin,
has expressed in offering his amendment. But I think that the
underlying resolution covers the problem in the appropriate way by
calling for a supermajority, or 60 votes, in order to waive the
provisions of the balanced budget in the event that there is a
recession, an economic crisis, which requires that. Therefore, I intend
to vote against the Durbin amendment.
There has been very considerable comment about whether Social
Security ought to be excluded from the balanced budget amendment. After
very considerable thought, Mr. President, it is my conclusion that
Social Security should be excluded. I say that notwithstanding my
recognition of the problems there will be to balance the budget now if
we exclude Social Security. But I submit that it is an artificial way
of balancing the budget, which says that we ought to make expenditures
which are not in excess of our income if we include Social Security,
because those funds really are a trust fund to pay Social Security
recipients at a later day. So what we are doing is saying we are going
to spend more money, which we really can't afford now, by invading the
trust fund, and we will put off for tomorrow what we are not willing to
face up to today, to find a way to pay the Social Security recipients
when the due date arises.
We know very well that the so-called baby boomers will present a
charge on the Social Security trust fund at a later date--2020--which
we will be unable to pay unless we find some way to raise taxes or some
way to make other cuts which are unrealistic in the context of what we
might expect at that time. It may be that in crafting a balanced budget
amendment, excluding Social Security, we will have to implement it on a
schedule which is realistic which will account for excluding those
surplus funds at the present time. But when we talked about Social
Security initially we were talking about an insurance fund concept. We
were talking about setting aside the money in a way where it would be
there to pay those benefits at the time when one reached the age for
Social Security.
So that it is my very, very strong view that as a matter of sound
financing that Social Security ought to be excluded. And this body has
responded on many occasions when that issue has been presented. My late
colleague, Senator John Heinz, was one of the major exponents for
taking Social Security offbudget--not the only exponent but I recall
the eloquent speeches which he made. And I recall many sense-of-the-
Senate resolutions where we talked about putting Social Security
offbudget because it is a trust fund.
I remember well during the tenure of James Baker, the Secretary of
the Treasury, when there was an unusual invasion of the trust fund. I
took the floor at that time and made a comment that there was really a
fraudulent conversion which I believed was the case, and have
analogized it to my experience as district attorney of Philadelphia
when there was a trust fund and a fraudulent conversion. The people who
took the money out of that trust fund were guilty of a criminal offense
because, if it is set aside for a specific purpose and the trustee
invades the fund for some purpose other than for which it was intended,
that is a conversion and an invasion.
So while I believe very strongly that we ought to have a balanced
budget amendment, I think if it is to be realistic and not a double set
of books that Social Security ought to be kept offbudget.
Mr. President, I think that in constructing a timetable for a
balanced budget amendment it is entirely possible to accommodate to the
lesser amount of income which we have from Social Security payments in
order to see to it that our current income aside from Social Security
payments matches our current expenses, and that is the only way to
truly have a balanced budget which I think we ought to have. And an
amendment is the way to impose the discipline to be sure we will have
it for the future.
Mr. President, I thank the Chair. I yield the floor.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. Mr. President, I thank my colleague for his willingness to
lead off in our efforts to pass the balanced budget amendment.
Naturally, I disagree with him on the Social Security issue. But I know
that he is a person of eminent qualification and one who does what he
believes is right.
I have had many years of opportunity to know the distinguished
Senator from Pennsylvania, and I have a lot of respect for him.
Mr. President, today we begin the second week of one of the most
important debates that has ever taken place in the U.S. Senate. The
subject matter goes to the heart of the Founding Fathers' hope for our
constitutional system--a system that would protect individual freedoms
with the maxim of limited government.
In the latter half of this century, however, the intentions of the
Framers of the Constitution have been betrayed by multiple Congress'
inability to control their spending habits. The size of the Federal
leviathan has grown to such an extent that the very liberties of the
American people are threatened.
Like some of the provisions of the Constitution, the proposed
constitutional amendment, Senate Joint Resolution 1, is an appropriate
addition to constitutional limits on the powers of the Federal
Government designed to increase the freedom of the people by limiting
the freedom of the Federal Government to act in ways that are harmful
to the people. It is identical to the balanced budget amendment that
was passed by the House of Representatives in the last Congress. A
number of our new Members voted for it at that time. It has broad
support in the country and among Democrats and Republicans in that we
need to ensure a sound fiscal discipline in our budgeting process in
order to leave a legacy of a strong national economy and a responsible
national Government to our children and grandchildren.
Mr. President, our Nation is faced with a $5.3 trillion--going to
$5.4 trillion--national debt that gets worse every year that we run
budgetary deficits. The Government is using capital that would
otherwise be available to the private sector to create jobs, and to
invest in the future of this country. Increasing amounts of capital are
being wasted on merely financing the debt because of spiraling interest
costs. This problem presents risks to our long-term economic growth and
endangers the well-being of our elderly, our working people, and
especially our children and grandchildren. The debt burden is a
mortgage on our children's and our grandchildren's future.
The total debt now stands at almost $5.3 trillion. By the end of this
debate it may very well reach $5.4 trillion. That means every American,
every man, woman, and child in this country has an individual debt
burden of about $20,000 per person. It took us over 200

[[Page S1154]]

years to acquire our first trillion dollars of debt. We have been
recently adding another $1 trillion to our debt about every 5 years.
While the trends on this front seem to be better, the fact is we are
still running sizable deficits every year. And, unless we take prompt
and decisive action, those deficits will continue to rise again this
year, next year, and year after year. In fact, if you look at the
President's budget, he even waits until he is out of office before they
have to make the tough decisions to really balance the budget by the
year 2002.
Yet, Mr. President, opponents of the balanced budget amendment claim
that there is no problem. They repeatedly point to the marginal
slowdown in growth in debt over the past few years as though all our
problems are solved. They say President Clinton has already dealt with
this problem.
They are dead wrong. Only inside the beltway can people claim that
when the debt is exceeding $5 trillion and still on the rise that we
are on the right track. Everyone on Capitol Hill knows and the
Congressional Budget Office has confirmed that we are currently not on
a glidepath to a balanced budget, or to the balanced budget that the
President may suggest. According to CBO's most recent projections, our
4 years of declining deficits that followed the enactment of President
Clinton's record-setting 1993 tax hike will come to a grinding halt
this year. What lies ahead is a familiar path of steadily increasing
deficits rivaling anything we have ever seen before unless we take
action to put us on the road to long-term fiscal discipline and
balanced budgets.
As this chart behind me shows, the Congressional Budget
Office predicts that under current policies the deficit will begin to
rise this year and continue to rise throughout the foreseeable future.
The Congressional Budget Office projects the deficit will rise to $124
billion in fiscal year 1997 and continue rising to $188 billion in
fiscal year 2002. The deficits just keep rising until in 2007 our
annual deficit is projected to be $278 billion. Added up, these
deficits will add a total of more than 2 trillion additional dollars to
the debt from now--in 1997--until the year 2007.

There is no balanced budget in this chart. And I have to tell you, I
doubt that there ever will be without a balanced budget constitutional
amendment putting the fiscal discipline into the Constitution that will
require us to live within our means. The simple fact is that with every
additional dollar that we borrow we throw more coal on the fire of the
runaway train that we are all riding on.
The sad reality is shown by this stack of unbalanced budget
submissions. The President's budget submission, which promises a path
to balance in the year 2002, causes me substantial concern that this
pile is just going to keep getting higher.
And this only lists the last 28 years of unbalanced budgets since the
last balanced budget in 1969. Actually, there have only been eight in
the last 66 years. But the last 28 years have all been unbalanced. Each
one of these volumes represents one of those unbalanced budgets during
each of those 28 years.
The sad reality is shown by this stack of unbalanced budget
submissions. The President's budget submission which promises us a path
to balance in the year 2002 just makes it very clear, if you believe in
the Congressional Budget Office projections, that this stack is just
going to grow that much higher over the next number of years.
For example, the President's new budget projects a modest surplus in
the year 2002 but also requires a 75-percent deficit reduction to get
there in the 2 years after he leaves office.
Now, get that. Up through the year 2000, this President's budget does
not require much sacrifice or much effort to try to balance the budget.
But in the years 2001 and 2002, 75 percent of the cuts have to take
place, and we all know around here that that is basically impossible to
do.
So the game continues, the same game we have put up with for 28
years, and it is pathetic, is what it is. This just indicates more of
the same status quo, an avoidance of the tough decisions and deferral
of the costs to the next guy, or should I say to our children.
Additionally, the Senate Budget Committee has suggested that
recomputing the numbers under CBO's more conservative economic
assumptions puts the President's budget off balance in the year 2002 to
the tune of an additional $66 billion. So the President's budget that
he submitted just last week is not going to balance.
The point is that we cannot yet congratulate ourselves for a job well
done. There is hard work ahead for each of us to do, and there is no
assurance of success. Based on the sad history illustrated by each of
these 28 years of unbalanced budget submissions and the continued
resistance of the President to take on the tough choices during his
actual tenure in office, success is in serious doubt.
That is one of the reasons why we need a balanced budget
constitutional amendment. It has been called an insurance policy that
we will get the budget actually balanced in the year 2002 and, more
importantly, that we will keep it balanced thereafter.
I would also note that it comes as no surprise that these increases
in our Nation's debt mirror increases in Federal spending. The first
$100 billion budget in the history of the Nation occurred as recently
as fiscal year 1962--that was the whole budget--more than 179 years
after the founding of our Republic. It took only 9 years for that
figure to double, and in just another 6 years Federal spending had
doubled again to $400 billion in 1977. I know, I was here. With another
6 years came another $400 billion increase in the Federal budget, and
by 1986 our Nation had seen its first $1 trillion annual budget. Today
we face an annual budget for fiscal year 1997 projected to exceed $1.6
trillion, as is the case under the budget recently submitted by the
President.
The Federal Government's appetite for spending the American people's
money is the engine that has been driving this debt up and up because
it has been easier to take the money in the form of a hidden tax like
interest costs and future taxes, than in the form of a direct tax.
One of most pernicious effects of the enormous deficit beast is the
interest costs required to feed it. Interest on the public debt in 1996
amounted to some $344 billion. That is roughly $50 billion more than
total Federal revenues in 1975. In other words, we spent less than $300
billion in 1957. In 1996, just 20 years later, gross interest costs
took nearly 25 percent of all Federal revenues and more than half of
all individual income tax revenue. And as this chart shows, net
interest payments on the debt make up the third largest charge of our
Federal budget.
It is the red pie that is taken out of the total pie--the third
largest payment in the Federal budget--exceeded only by defense
spending and Social Security.

It is really amazing when you look at it: Social Security spending,
22 percent, defense spending is 18 percent, and net interest is 15
percent. And it is going up every year and will go up exponentially
unless we do something about it. And yet we have the same people around
here year after year saying, ``Oh, let us just exercise our will and
let us just do it.'' That is what they said for every 1 of these 28
years of these unbalanced budgets, and that is what they will be saying
10 years from now without any balanced budget, if we do not have the
balanced budget constitutional amendment.
Opponents of the balanced budget amendment suggest that we cannot
afford to create a constitutional impediment to deficit spending
because they believe that balancing the budget will result in decreased
social spending.
I do not personally understand the logic of continuing to waste such
a large portion of our budget on interest on the rationale that we
cannot afford to cut spending. What we cannot afford to do is continue
to throw away so much of our budget on interest payments. Think of how
much we could do on crime control, defense, disaster relief, health,
science, and education if we had $344 billion available next year
instead of paying interest against the national debt with that money.
To help my colleagues put this in even better perspective, gross
interest on the debt in 1966 amounted to more than the entire defense
budget of $266 billion; 99 percent of Social Security payments, $347.1
billion; 64 percent of

[[Page S1155]]

all discretionary outlays, $535.4 billion, and nearly 45 percent of all
mandatory programs of $784.9 billion.
The $334 billion of gross interest payments on the debt in 1996 could
have covered our entire health spending, including Medicare and
Medicaid, that is, $293.6 billion, all veterans-related entitlement
spending, $18.8 billion, unemployment compensation, $22.6 billion, the
cost of Federal law enforcement activities of $8 billion, and we would
still have $1 billion to spare.
Last year, in fact, we spent more money on net interest payments on
the debt than we did for the combined budgets of the Department of
Commerce, the Department of Agriculture, the Department of Education,
the Department of Energy, the Department of Justice, the Department of
the Interior, the Department of Housing and Urban Development, the
Department of Labor, the Department of State, and the Department of
Transportation. Just think about that.
Interest on the debt is the fastest growing item in the annual
Federal budget. According to the current Congressional Budget Office
projections, gross interest on the debt will continue to rise
substantially over the next 5 years from $360 billion in 1997, to $412
billion by 2002, and by 2007 just the interest on the debt is projected
to be $493 billion.
If we keep going like we are, we are going to be paying almost
everything on interest that could be used to solve a lot of problems in
our society. This $495 billion is just $50 billion shy of our entire
discretionary budget for the current fiscal year.
Over the past 4 years of short-lived deficit reduction, we have paid
roughly $1.3 trillion in interest on the public debt. That is more than
the Federal Government took in during all of 1994. Without the gross
interest on the debt, we would not have had a deficit in 1996. In fact,
we would have run a budget surplus of $237 billion.
But we cannot even begin to think about reallocating this money to
more productive uses until we begin to reduce our debt. If interest
rates go back up, the problem will be increased exponentially. Self-
propelled interest costs will continue to eat a larger share of our
National Treasury, destroying our choices to fund new programs and
eroding our ability to keep the commitments we have already made. This
is serious stuff.
And even if we are successful in passing a budget this year that will
balance our budget by the year 2002, we will never begin to reduce our
debt unless we can provide some assurance that such balanced budgets
will become the rule rather than the exception. That is what the
balanced budget amendment is geared to do.
Mr. President, both sides will recite lots of numbers and figures
during the course of this debate. One such figure is our current $5.3
trillion national debt. But how does one communicate the implications
of our staggering debt?
In 1975, before this recent borrowing spree, the Federal debt
amounted to approximately $2,500 per person. That was each American's
share of it in 1975, and the annual interest charges were roughly $250
per taxpayer. At present, the Federal debt amounts to about $20,000 per
person, with annual interest charges that each person in this country,
each man, woman, and child in America, has to pay, totaling nearly
$1,350 per person, or roughly $2,975 per taxpayer. That is at today's
interest rates, which will go even higher if we do not get things under
control.
The Congressional Budget Office predicts that in the year 2002, total
Federal debt will be more than $6.8 trillion. That means roughly
$24,000 of debt for every man, woman, and child in America, with annual
interest costs projected to be over $3,100 per taxpayer.
These last figures would mean a nearly tenfold increase in per-capita
debt and a nearly twelvefold increase in annual interest charges per
taxpayer since 1975. Over time, the disproportionate burdens imposed on
today's children and their children by a continuing pattern of deficits
could include some combination of the following: Increased taxes,
reduced public welfare benefits, reduced public pensions, reduced
expenditures on infrastructure and other public investments, diminished
capital formation, diminished job creation, lower productivity
enhancement and less real wage growth in the private economy, higher
interest rates, higher inflation, increased indebtedness to and
economic dependence on foreign creditors, and increased risk of default
on our Federal debt.
Senator Simon would always make this point: If we keep going like we
are going, ultimately we are going to have to monetize the debt--that
is, print cheap money--where it will cost you a bushelful of dollars to
buy a loaf of bread like it did in Germany in the 1930's, and then
write off all the debt on cheap dollars. But the United States of
America as we know it will be gone at that point.
Mr. President, this is fiscal child abuse and it must end. But, as I
indicated earlier, there is no end in sight. After 4 years of declining
deficits--financed partly with the largest tax increase in history--we
have not reduced our staggering $5.3 trillion national debt 1 penny. We
have only slowed the growth in the national debt.
More important, as my Republican colleagues and I predicted would
happen during the debate on the President's 1993 budget package, the
Congressional Budget Office now predicts--and if you look at this
chart--it now predicts that annual deficits will resume their upward
climb beginning this year from an annual deficit of $124 billion in
1997, to $188 billion in the year 2002, and then exceeding $200 billion
the next year and reaching a near record $278 billion high in the year
2007. Even OMB's estimates from the President's newly proposed budget,
which predict lower debt totals than CBO, project that gross Federal
debt will top $6.6 trillion, exceeding 66 percent of our gross domestic
product by the year 2002.
That means, according to their own estimates, the Clinton
administration's self-proclaimed victory in bringing down the deficit
will result in an additional $1 trillion or more being added to the
national debt between now and the year 2002.
Mr. President, we do need to do more. It is time for Congress to pass
Senate Joint Resolution 1, to permanently restore the fiscal
environment in which the competition between tax spenders and taxpayers
is a more equal one--one in which spending decisions will once more be
constrained by available revenues. The time has come for a solution
strong enough that it cannot again be evaded for short-term gain. We
need a constitutional requirement to balance our budget. Senate Joint
Resolution 1 is that solution. It is reasonable, enforceable, and
necessary to force us to get our fiscal house in order.
There are those who oppose the balanced budget amendment because they
say that Congress and the President are already committed to balancing
the budget by the year 2002. As a matter of rhetoric, that is true; as
a matter of what people say, that is true. But as a matter of real
world politics, it is clear that the bridge between such rhetoric and
reality is a rather long one.

Since 1978 alone, there have been no fewer than five major statutory
regimes enacted which promised to deliver balanced budgets. This
includes Gramm-Rudman-Hollings. But there has not been a single
balanced budget since 1960.
Here are the 28 succeeding budgets. In about every one of these it
was promised there would be an effort made to balance it, every one of
which is unbalanced right up to today.
Notwithstanding all of these budget plans and the five statutory
attempts to require a balanced budget that I have mentioned, the
national debt has increased by roughly $4.5 trillion since 1978. In
other words, nearly 85 percent of our current national debt has
accumulated during the period of time in which Congress has operated
within statutory budget frameworks designed to ensure the types of
fiscal discipline that would be required under Senate Joint Resolution
1.
While I support the efforts of the past and commend the dedication
expressed by leaders of both political parties to reaching a balanced
budget, I seriously doubt whether, without the weight of a
constitutional requirement to balance the budget, we will achieve
balance by the year 2002. Even if we did, there is nothing to prevent
future Congresses from yielding to the inherent political

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pressures that would lead to renewed deficit spending. We need a
constitutional amendment if we are truly committed to solving this
problem.
Mr. President, the proposed constitutional amendment will help us end
this dangerous deficit habit in a way that past efforts have not. It
will do this by correcting a bias in the present political process
which favors ever-increasing levels of Federal Government spending.
In seeking to reduce spending bias in our present system--fueled
largely by the unlimited availability of deficit spending--the major
purpose of Senate Joint Resolution 1 is to ensure that under normal
circumstances, votes by Congress for increased spending will be
accompanied either by votes, A, to reduce other spending programs or,
B, to increase taxes to pay for such programs. For the first time since
the abandonment of our historical norm of balanced budgets, Congress
would be required to cast politically difficult votes as a precondition
to politically attractive votes to increase spending.
The American political process is skewed toward artificially high
levels of spending. It is skewed in this direction because Members of
Congress have every political incentive to spend money and almost no
incentive to forego such spending. It is a fiscal order in which
spending decisions have become increasingly divorced from the
availability of revenues.
The balanced budget amendment seeks to restore Government
accountability for spending and taxing decisions by forcing Congress to
prioritize spending projects within the available resources and by
requiring tax increases to be done on the record with record votes. In
this way, Congress will be more accountable to the people who pay for
the programs, and the American people, including our future generations
who must pay for our debts, will be represented in a way they are not
now represented. Congress will be forced to justify its spending and
taxing decisions as the Framers intended, but as Congress no longer
does.
Senate Joint Resolution 1 represents both responsible fiscal policy
and responsible constitutional policy. Passage of this resolution would
constitute an appropriate response by Congress to the desires of the
people and the States for a constitutional amendment on this issue.
The Senate must approve Senate Joint Resolution 1, the balanced
budget amendment. It is the right thing to do for ourselves, our
children, our grandchildren, and future generations, and it will give
us back responsible and accountable constitutional Government. The
faithful stewardship of public funds that was so prized by our Founding
Fathers can be restored for 21st century Americans.

The virtues of thrift and accountability can be rekindled by this
very 105th Congress, so I urge Senators to join with me and the other
61 sponsors of Senate Joint Resolution 1 in support of the bicameral,
bipartisan, consensus balanced budget amendment which has taken years
to develop and for which we have fought for over 20 years.
This is the thing to do. This is the chance to do it. This is the
chance to do what is right. I hope our colleagues will do so.
I apologize to my colleague who has been on the floor, who would like
to call up an amendment, so I yield the floor to him at this time.
The PRESIDING OFFICER. The Senator from Minnesota is recognized.
Mr. WELLSTONE. Mr. President, let me first of all thank my colleague
from Utah for his remarks. He has been a real leader on this. He is
tenacious; he never, never gives up. I have tremendous respect for his
work as a Senator, even though we are in profound disagreement on this
question. But I would like to thank him for kind of matching what he
does on the floor of the Senate with the kind of words he speaks.
Mr. HATCH. I thank the Senator.

Privilege Of The Floor

Mr. WELLSTONE. Mr. President, I ask unanimous consent that Dr.
Rebecca Constantino, who is a fellow in our office, be granted the
privilege of the floor during the debate on the amendment I am about to
propose.
The PRESIDING OFFICER. Without objection, it is so ordered.

Amendment No. 3

(Purpose: To state the policy of the United States that, in achieving a
balanced budget, Federal outlays should not be reduced in a manner that
disproportionately affects outlays for education, nutrition, and health
programs for poor children)

Mr. WELLSTONE. Mr. President, I send an amendment to the desk.
The PRESIDING OFFICER. The clerk will report the amendment.
The assistant legislative clerk read as follows:

The Senator from Minnesota [Mr. Wellstone] proposes an
amendment numbered 3.

Mr. WELLSTONE. Mr. President, I ask unanimous consent that the
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:

Redesignate section 8 as section 9 and after section 7 add
the following:
``Section 8. It is the policy of the United States that, in
achieving a balanced budget, Federal outlays must not be
reduced in a manner that disproportionately affects outlays
for education, nutrition, and health programs for poor
children.''

Mr. WELLSTONE. Mr. President, let me read this amendment slowly and
carefully, because I am hoping to get a very strong vote in favor of
this amendment, and I hope it will be an up-or-down vote. This is a
pretty important matter amending the Constitution, and if this is going
to be done--it may or may not be done--we better do it well, we better
do it carefully.
This amendment says:

It is the policy of the United States that, in achieving a
balanced budget, Federal outlays must not be reduced in a
manner that disproportionately affects outlays for education,
nutrition, and health programs for poor children.

What this amendment is saying, and I will give plenty of historical
and economic context for it, is that we should go on record and make it
very clear that if, in fact, this constitutional amendment to balance
the budget is passed, which then locks us into this goal, will make the
commitment that we are not going to, as we did in the last Congress,
disproportionately cut programs that affect, quite often dramatically,
the nutritional or health or educational status of poor children in
America.
The reason that I offer this amendment is that I think we need to
have some focus on this question. There can be arguments made, and
there have been, on whether or not we ought to amend the Constitution.
There can be arguments made about whether or not this is a mistake vis-
a-vis our fiscal and monetary policy to make sure recessions don't
become depressions. There are arguments both ways.
Senator Durbin has an amendment on the floor that says, look, if we
need to move forward with an economic plan that puts the budget out of
balance during a downturn in the economy, it should just be a
requirement of a majority vote. I think that amendment is on the mark.
I see the budgets over the years. There could be an argument of whom
to blame. I wasn't here during the decade of the eighties or prior to
that time. We can argue it both ways. I think historians are going to
write about a piece of legislation which was euphemistically called the
Economic Recovery Act which dramatically cut tax rates. I think it
became rather regressive, because most benefits went to higher income
citizens, at the same time of dramatically increased expenditures in
the Pentagon. I think President Bush once called it voodoo economics.
All of it was to lead to economic growth. People would have more money
with a tax cut, productivity, jobs. It would lead to eliminating the
debt. Actually, quite the opposite happened.
That was actually borrowed money and borrowed time. It was politics
of illusion. I really appreciate the focus of Senator Hatch on no
longer having that illusion and the message from the people in the
country that we should get our economic house in order and our
political house in order. But what I am asking Senators to do, because
I think we really owe it to the people we represent, is to make a
commitment that one more time, as we go about achieving a balanced
budget, Federal outlays must not be reduced in a manner which
disproportionately affects outlays for education, nutrition and health
care programs for poor children.

[[Page S1157]]

I hope this amendment will not be tabled. I offer this amendment with
passion and with commitment to a matter that I think is very important.
I think there should be an up-or-down vote, and I hope it will be
adopted.
Mr. President, why the amendment? Well, because of recent history.
The Center on Budget and Policy Priorities issued a report entitled
``Bearing Most of the Burden: How Deficit Reduction During the 104th
Congress Concentrated on Programs for the Poor.'' I will just read a
few of their conclusions:
More than 93 percent of the budget reductions in entitlements have
come from programs for low-income people. The Congressional Budget
Office estimates that legislation enacted during the 104th Congress
reduced entitlement programs by $65.6 billion from 1996 to 2002. Of
that, almost $61 billion out of the $65.6 billion comes out of low-
income entitlement programs, the largest reductions in the supplemental
security income program and programs for the elderly and the poor.

Please remember, I say to my colleagues, that one out of every five
children in America today is poor. Mr. President, I read an article the
other day with great interest of how you, as the Senator from Missouri,
have teamed up with other Senators, like Senator Coats, and you have
your own commitments to really not turning our gaze away from the
concerns and circumstances of one out of every seven Americans, many of
them children, but you are committed to doing something.
We might have different ideas of what to do. I think that is
commendable, and I know you well enough to know that you have that
commitment. What I am worried about is deficit reduction based on the
path of least political resistance, because I think that is exactly
what we did in the last Congress. That is to say, we are afraid to take
on powerful interests, so, instead, what we do is we go after the
people who are not the heavy hitters, who are not the big givers, who
are not well connected, and those people, all too often, in the Senate
are voiceless and they are faceless and they are powerless and they are
disproportionately poor children in America.
I hope my colleagues will at least support this amendment. If this
passes, it happens one time. Let's get it right. If we are going to
lock ourselves into balancing the budget and deficit reduction, let's
lock ourselves into humane and fair priorities that we are not going to
disproportionately cut programs that affect the educational and
nutritional and health care status of children.
Mr. President, other than entitlements, 34 percent of the reduction
in nondefense programs that are not entitlements came from
nonentitlement programs for people with low incomes. Those low-income
people programs accounted for only 21 percent of overall funding, but
they were disproportionately cut as well.
Just looking at the 104th Congress, I offer this amendment to make
sure that we make a commitment that we are not going to cut such vital
programs. Sometimes we are just too generous with the suffering of
others. Let's not be too generous with the suffering of poor children
in America.
The Concord coalition had this to say. Martha Phillips the executive
director, on November 26, 1996:

Balancing the Federal budget--

And this has been a goal of the Concord coalition--

and keeping it in balance is critically important, but
balance ought not to be achieved principally on the backs of
the poor. Every program should be on the budget cutting
table. No programs, groups or special interests should be
exempt or get a free ride when the budget is being balanced.
But neither should the needy be singled out to bear a
disproportionate share of the load.

They go on to say--this is the Concord coalition, I say to my
colleagues, committed to deficit reduction. The Concord coalition goes
on to say, under the able leadership of Senator Rudman and Senator
Tsongas, who passed away--a real loss for our country--the Concord
coalition goes on to say:

Even though the 104th Congress, which passed the laws, and
the President, who signed them, did not plan to target
deficit reduction efforts on programs affecting low income
people, that was nevertheless the result of both actions that
were taken and those that were not.

(Mr. ROBERTS assumed the chair.)
Mr. WELLSTONE. Mr. President, there is another interesting statement
from the Committee on Economic Development. By the way, I would like to
congratulate the business community in our country. The Committee on
Economic Development over and over and over again, over the last
several years, have said, from the point of view of economic
performance for our Nation, we must invest in the health, skills and
intellectual character of our children. We must do that.
I quote, as a part of a letter that was written November 26, 1996, by
the senior vice president and director of research of the Committee on
Economic Development:

Second, in an unfortunate surrender to misplaced ideology
and political opportunism, our leaders in both political
parties have increased the magnitude of the financing problem
by insisting that tax reductions be included in their
balanced budget plans.

That was their view. By the way, I think we are going to have to look
very closely at some of those budget proposals. My understanding is the
Joint Tax Committee, in projecting the majority party's tax cuts over
the next 10 years, has identified close to $500 billion in the first 5
years more targeted toward middle-income people and the second 5 years
more targeted toward wealthy, high-income people.
What is going to be the offset? Cuts in the nutritional and
educational and health care programs for poor children in America? If
that was the case, that would be unconscionable. If there was some sort
of budget deal that leaves these children out in the cold, that would
be unconscionable.
The senior vice president of the Committee on Economic Development
goes on to say:

Third, as a result of the fiscal pressures created by these
two factors, the burden of budget austerity has fallen
disproportionately on those parts of the budget, and those
parts of society, that offer the least political resistance.

Actually, I have been saying that over and over again. I guess we are
in agreement. I am pleased to hear them actually state it that way.
For the budget that means that the discretionary annually
appropriated programs, including those public investment activities for
a society--it quite simply means the poor.
Now the quote:

As David Stockman observed a decade ago, politics triumphs
over policy in seeking out weak clients rather than weak
claims.

This amendment asks us not to let politics triumph over policy. This
amendment asks us to seek out the weak claims, not the weak clients.
This amendment says we go on record that when we balance the budget,
we will not cut disproportionately those programs that affect the
health care, nutritional and educational status of poor children. We
ought to have 100 Senators voting for that. We can go forward to
balance the budget. We can go forward with deficit reduction. But given
the way we did it in the last Congress, and the evidence, I must say to
my colleagues, it is irreducible and irrefutable that we ought to at
least make this commitment.
Mr. President, the Washington Post in an editorial written today had
this to say:

The balanced budget debate is only in part what it purports
to be--an argument over the deficit, savings, growth, and the
shifting of cost to the next generation. It is also a sharp
debate over social policy, conducted in fiscal code. If you
decide to balance the budget, the question immediately
becomes, at whose expense? The budget is by its very nature a
redistributive device. On balance, it tends to move money
from people who are better off to those who are not. If you
narrow the deficit, will it end up doing more of that, less
or about the same?

This editorial goes on to make the argument that if we are going to
do it, we ought to do it on the basis of a standard of fairness. We did
not do that in the 104th Congress.
This amendment asks the U.S. Senate, in the 105th Congress, Democrats
and Republicans, to go on record that if we are going to balance the
budget, we are not going to do it on the basis of the path of least
political resistance and not going to go after weak clients. We are
going to go after weak claims. And we are not going to end up passing
budgets that disproportionately cut programs that affect the health,
nutritional and educational status of poor children in America.
If I were to get 100 votes, I would feel like I have died and gone to
Heaven. I

[[Page S1158]]

really would. I am so hopeful that my colleagues will vote for this
amendment.
Mr. President, in an interesting poll result, the Committee for
Education Funding points out that whereas there is support for the
constitutional amendment to balance the budget--and there is. I have
been opposed to it. You have to ultimately follow your conviction and
vote for what you think is right or wrong. Senator Hatch clearly takes
another position, and he votes his conviction. No one would ever say
otherwise.
But it is interesting that public opinion polls show--according to
the Committee for Education Funding--that 90 percent of Americans
support maintaining or increasing Federal support for education. When
directly asked if they would support a balanced budget constitutional
amendment that reduces funds for education, nearly 70 percent
disagreed. So this amendment just asks us to be clear about how we
intend to do this.
Mr. President, just a little bit more context. I am going to get a
chance to speak on this amendment today, and then I guess we will go
back to the Durbin amendment and tomorrow get a chance to speak and
then have a vote.
We are, as I said the other day on the floor of the Senate, in many
varied ways a model for much of the world. I mean, we should be so
proud of our country, the diversity of our country, so proud of our
economic performance, so proud of our leadership in the world, so
proud, I think, of really helping to create a world where we no longer
have to think so much about a nuclear war that could be the end for our
children and grandchildren. But there is at least one way in which we
are not a model, one area in which I think in recent years we have been
moving in the wrong direction. And that is in fulfilling our national
vow of equal opportunity. That kind of national commitment is in need
of refurbishing and renewal.
I bring this amendment to the floor because more than 35 million
Americans are poor. That is one out of every seven citizens. In 1994,
of poor children under the age of 6, nearly half lived in families
below half the poverty line. That figure has doubled over 20 years. The
number of people who work and are poor and work full time, 52 weeks a
year, 40 hours a week, and still are poor has dramatically increased as
well.
Mr. President, minorities are poorer than the rest of Americans.
African-Americans are close to 30 percent, Hispanics at a little over
30 percent, and female-headed households are even poorer, and 44.6
percent of the children who live in such families are poor. In 1994,
almost half of all children who were poor in America lived in female-
headed households. So what we have here is one out of every five
children poor, but it is getting closer to one out of every four
children. One out of every two children of color are poor.
Unfortunately, we cannot turn our gaze away from this reality, a strong
convergence between poverty and race and gender and children in
America.
I am asking us to go on record to be for fairness in how we do this
deficit reduction.
Mr. President, let me give a few examples of the kinds of programs
that I am talking about when I say that we should go on record that we
will not disproportionately cut these programs that affect the
nutritional health and educational status of children.
Let me start out with the Women, Infants, and Children Program. Let
me make a point with my colleagues, because sometimes I am going to
give a lot of examples. I am going to talk about women and children. I
want to translate these statistics into personal terms.
But, first, as a teacher, I think I have said it before on the floor
of the Senate, but I want to say it again. I was a college teacher for
over 20 years. I have been in a school in Minnesota probably about
every 2 weeks ever since I was elected. It is just crystal clear to me
that the most important educational program in the United States of
America--you know we talk about higher education. I was a college
teacher. It is a big issue. It cuts across affordable higher education,
cuts across a broad section of the population that people are very
focused on, and it should be.
But as a matter of fact, I think the most important educational
program is to make sure that every women who is expecting a child has
an adequate diet, rich in vitamins, minerals, and protein. It is just a
fact. It is just a fact. The evidence is irreducible and irrefutable
and it is medical evidence. If we do not make sure that every woman
carrying a child has an adequate diet, all too often her child will be
born severely underweight, her child will be born with an impairment
that may mean that no matter what we do in our public schools, that
child will never have the same chance as probably all of our children,
Senators' children, or grandchildren. It is the essence of the American
dream. It is the goodness of our country, for us to say that every
child, no matter what race or gender or income of family, will have the
same opportunity to reach her full potential or his full
potential. That is what my father, who was a Jewish immigrant from
Russia, taught me about our country. That is the greatness of our
country. It is not too much for me to ask my colleagues to go on record
that in balancing the budget we will not make any cuts in the most
important educational program, the Women, Infants, and Children
Program.

In 1996, Mr. President, WIC provided assistance for 7.2 million
women, infants, and children. That was about 60 percent of the eligible
population. There are about 11 million women and children that are
eligible. So, some women and some infants and some children are left
behind.
Mr. President, let me talk a little bit about the WIC Program. It was
established as a pilot program in 1972 and it was made permanent in
1974. It is administered by the U.S. Department of Agriculture. Who is
eligible? Pregnant or postpartum women, infants, and children up to the
age of 5 are eligible. Mr. President, how many people does it serve?
More than 7 million people get WIC benefits every month, and
participation has risen steadily. Children are the largest category of
WIC recipients. Of the average 6.89 million people who received WIC
benefits each month, 3.5 million were children, 1.8 million were
infants, and 1.6 million were women.
Mr. President, this is a program that is a huge priority or should be
a huge priority for this Senate. It is a success story. Sometimes we
harp on the complexity of it all like we do not know what to do. I am
in agreement with every single Senator that says some of these
Government programs ought to be reevaluated, some of them do not work
well. But from the point of view of decency, of fairness, of justice,
of saving money--what is the figure? For every $1 we invest in the
Women, Infants, and Children Program, it is $3 less we spend in medical
assistance later on.
WIC is a huge success story. The Women, Infants, and Children Program
reduces fetal deaths and infant mortality. WIC reduces low birth rates
and increases the duration of pregnancy. WIC improves the growth of at-
risk infants and children. WIC decreases the incidence of iron
deficiency anemia in children, improves the dietary intake of pregnant
and postpartum women, and improves weight gain in pregnant women.
Pregnant women participating in the Women, Infants, and Children
Program receive prenatal care earlier. I think, Mr. President, about
every 2 minutes in America a child is born to a woman who had no
prenatal care. Children enrolled in WIC are more likely to have a
regular source of medical care and are better immunized. Children who
receive WIC benefits demonstrate superior cognitive development. WIC
significantly improves children's diet. WIC is cost effective.
I am just asking my colleagues to make a commitment that we will not
disproportionately cut this program as we move forward to balance the
budget because in the last Congress we disproportionately made cuts in
programs that affected those citizens who did not have the political
clout here, who did not give the big dollars, who are not the heavy
hitters, who are not the well connected. This is a distorted priority
if we at least do not make a commitment on behalf of these children.
Mr. President, I will give some examples from the Women, Infants, and
Children Program, but I want to first of all call attention to my
colleagues to a special report in Time magazine February 3, 1997, ``How
a Child's Brain Develops and What It Means for Child Care Welfare
Reform.'' Mr. President, I

[[Page S1159]]

congratulate Time magazine for this issue. I really believe that we
will see major change in how we think about our priorities here as a
result of the kind of research that Time magazine reports on.
Basically, if I had to summarize this whole issue, the conclusion is as
follows: If you do not make sure that women expecting a child have an
adequate diet, if you do not make a commitment to these children when
they are young, if you do not make sure that they do not have not only
adequate nutrition and adequate health care, but if you do not make
sure that they do not have intellectual stimulation, a nurturing and
caring environment--and by the way, Government cannot do all of that.
The President knows that. Much of that is up to the family. If you do
not make sure that that does not happen, then by age 3 for many of
these children, it is almost close to all over; certainly by age 5.

I think that what we are going to see and more of the concern that
will come out, and it will be compelling, if we do not make the
investment, if we do not do everything to make good things happen at
the local and community level, and realizing people need resources to
make sure that for these children we invest in the intellect and the
character of these children, or many of them will therefore not make
it. What a waste that would be for our Nation.
Mr. President, I have said before on the floor of the Senate and
today is my day to try and give this context because I think so much of
politics is personal, I have learned so much as a grandfather. Because
our children are all older and we had our children when we were very
young, I forget what it was like. Now when we have the grandchildren
over, I have said on the floor of the Senate before, you take a 2-year-
old and you watch him or I watch our granddaughter, it is amazing.
Being in the same room, in the same house, and every 15 seconds they
find something interesting and new. The President is smiling. He may
have seen the same thing. What is going on is that these small children
are experiencing all the unnamed magic of the world that is before
them. We ought to ignite that spark for all of our children. We do not
want to pour cold water on that spark, and we have, for too many
children. Actually, it does not make much of a difference whether it is
my grandchildren or anyone else's grandchildren, they are all God's
children. I think it is time for us to move beyond symbolic politics
and it is time to stop giving the speech and having the photo
opportunities next to the small children unless we are willing to make
an investment.
Mr. President, at 23 years old, Elaine became pregnant and soon after
she was laid off of her $9 an hour office job. Since she was pregnant
she had difficulty finding another job. She did find one at $6 an hour.
With little resources, she immediately learned about the Women,
Infants, and Children Program which she says is the reason her baby was
born healthy and strong. Her initial guidance from the WIC office in
Reno, NV, taught her the basic nutritional information. I am just
reading from this example. We have collected stories from people around
the country. All too often we just speak in statistics here, or
strategy or tactics. I want to try and translate this amendment into
personal terms as it affects people's lives. Every month Elaine
attended nutritional classes and received vouchers for items like milk,
cheese, peanut butter, and beans. She said, ``I had no idea what I was
supposed to eat and what was right for my baby. The public nurses were
all so nice and helpful, I never felt bad. They wanted me to have a
healthy baby as much as I did. I knew nothing about babies, like breast
feeding and stuff. They taught me all that.'' After Elaine gave birth
to a healthy boy, she would take him to the WIC clinic where he was
examined.
The same nurses who guided her through the pregnancies guided her
through the initial steps of child rearing. Not only did she learn the
basics of taking care of her son, but she continued to receive
financial assistance. Says Elaine, ``The formula cost $160 a month and
I did not have it. WIC gave it to me, and I'm not sure what I would
have done without that help.''
Eventually, Mr. President, Elaine returned to her office job at a
rate of $9.60 an hour, and she was no longer eligible for WIC, and she
should not have been. She now lives independently with her son. ``WIC
saved me. I really don't know how I would have survived. It helped me
survive on an emotional level and with finances. I was really
surprised. I always thought these kinds of programs were for `low-
lifes,' but they were a lot like me. I just had hard luck and needed
help. I got it.'' And Elaine's son got it. That is the difference
between Elaine's son having a really what we would call successful and
full life versus what might have happened to her son if she had not
received this assistance.
Is it too much for me to ask colleagues to go on record that we will
not disproportionately cut the Women, Infants, and Children Program?
Really, we should not cut it at all. This amendment doesn't even ask us
to do that. Actually, we ought to fully fund it now. I don't understand
some of these proposals here in Washington--some from the White House.
When we don't actually fully fund some of these programs, I don't know
exactly how we figure out which children go without health care, which
children go without the nutritional help they need, which children are
not in the Head Start programs. Who makes that decision? We know how we
can make a difference and be helpful. We have some proven, credible
programs that have worked, that are key to children, key to what we are
about as a country. I am just saying, let us at least make a commitment
that these programs are not the programs that we disproportionately
cut.
Mr. President, let me now move on and talk about the Head Start
Program. Mr. President, the Head Start Program is a program that began,
as I remember, back in 1965, or thereabouts. It is a program which, in
many ways, is not perfect, but it has lived up to its title, which is
that we do, as a Nation, just what the program says; we give children
from some really difficult and tough circumstances, from low-income
families, a head start. That is the goodness of America, what we are
about. Yet, Mr. President, in 1996, the Head Start Program reached only
17 percent of eligible 3-year-olds and only 41 percent of eligible 4-
year-olds. In the United States, almost 4 million children are eligible
for Head Start, because children 1 and 2 could be receiving or
participating in this program. But it served just over 800,000 of those
over 4 million children. Roughly, 3.2 million children are not being
served.
The President's budget proposal says we will, by 2000, 2001, fund
Head Start for another 1 million children. I still don't understand how
we can make the collective decision not to fully fund it. How do we
explain to people in the country, or more important, how do we explain
to children?
Jonathan Kozol--and I recommend Jonathan's work--wrote a book called
``Amazing Grace: Poor Children and the Conscience of America.'' He
wrote another book called ``Savage Inequalities: Public Education in
America.'' His writing is so powerful. In an article he recently wrote
for a journal called Tikun, a very interesting journal, he writes at
the end:

Millions of children in sequestered neighborhoods, like the
South Bronx, do not know what they have the right to hope
for. Their eyes ask questions that you and I and all of us
have yet to answer.

Their eyes ask questions that, as Senators, we have not answered. One
of those questions is, how can a country, how can a Congress, that
purports to love children do so precious little to help some of the
children that are the most vulnerable citizens with the direst need?
Mr. President, across the freeway from the comforts of Disneyland is
a housing division, a stone's throw from the lavish and affluent hotels
that serve tourists. In a corner apartment lives Rene, a lively,
exuberant, and bright 8-year-old. She is in the second grade where she
is doing well in school. In fact, every morning Rene runs to school
excited to learn. Too many of our children are running into the arms of
police, rather than into the arms of parents and teachers.

We pay a price for not investing in our children. We pay a price for
not investing in poor children in America. Rene attended two years of
Head Start, which, according to her mother, was ``a Godsend.'' At Head
Start, Rene learned

[[Page S1160]]

the fundamentals of schools, such as her colors, the alphabet, and
writing her name. More importantly, Rene and her family learned about
school. For Rene, learning about school at Head Start meant more than
academics. It meant her mother learned about nutrition and eating
right. It meant her mother learned how to interact with and talk to
teachers. Her mother learned how to prepare Rene for school, things
like clean clothes and breakfast. It meant her mother learned about
reading to Rene. It meant her mother learned that Rene needed a
structure, a set time to eat dinner and to go to bed. Head Start taught
this. Learning about school meant Rene learned to interact with her
peers. She learned about sharing. She learned how to listen, how to
take directions. Rene learned about curling up and being read to. She
even learned to brush her teeth. Rene, Mr. President, represents one of
the many children who have benefited from Head Start. Said her mother,
``Before Rene got in this program, I knew nothing about what she
needed. I was kind of scared for her to go to school. I didn't do so
good in school, and I was getting ready for the same with her. Her
teachers cared about her and me. They wanted to work with us, too. I
knew they cared.''
Remember, Mr. President, that the Head Start teachers who did so much
for Rene and began her on the path to school success earn about $17,000
a year. Also, keep in mind that for every Rene that benefited in Head
Start, two are turned away. For every Rene that benefited in Head
Start, two are turned away.
I am asking Senators to make a commitment with this amendment, in an
up-or-down vote, that we will not, in balancing this budget,
disproportionately cut programs that affect the educational, health
care, or nutritional status of children. WIC is one example, and the
Head Start Program is another. I don't think that is too much to ask.
Marcus, a shy and quiet first-grader, finds himself in the
principal's office for the third time in a week. According to his
teacher, Marcus is either overagitated, annoying other students in
class, or else listless and disinterested in the tasks at hand. Marcus
usually doesn't understand what is happening in class. He does not yet
know all of his colors, his numbers, or the alphabet.
Though many of his classmates attended a Head Start Program
and learned the initial steps toward understanding school and
learning, Marcus did not. He represents one of the 1.2
million children who, though eligible, could not participate
in the Head Start Program.

Mr. President, in Minnesota, my State, only 40 percent of the
children who are eligible for Head Start have access to it. In other
States it is much lower.

The program near his home was full. Not only was it full
but there was a year waiting list when Marcus' grandmother
tried to sign him up. Though there was room in another
program, it was too far for his grandmother to take him.
Instead, Marcus stayed home, sometimes alone, while his
grandmother worked. Marcus is conspicuously behind his
classmates. While his classmates scurry around the teacher to
be read to, he had not yet held a book or had ever been read
to. Marcus does not even know how to write his name.

Let me pick up on that.
He had not held a book, and he had never been read to. Why don't we
go on record, in all of this haste to balance the budget, that we will
not balance the budget on the backs of poor children, and we will not
make cuts which would make it impossible for a child like Marcus to
have a book read to him in a Head Start Program?
There are a lot of homes that do not have any books at all. I read
somewhere that one of the factors that most explains how well children
do in school is the number of books that are in the home. Mr.
President, there are many homes where the parent or parents can't
afford any books. I would just suggest to my colleagues that one of the
most important things we could ever do is to make sure that children
have access to those books or that someone can read those books and
nurture those children and stimulate those children.
Peter Hutchinson, superintendent of schools in Minneapolis, made an
excellent suggestion that I am going to try out speaking at the
legislature next week speaking about children. Peter Hutchinson, Mr.
President, said something that I think is appealing to you; a wonderful
voluntary effort. He said, ``You know, Paul * * *'' and he has two
teenagers--``we have all of these wonderful children's books in the
home but the children are older now. Why don't we get those books in
the other child's home? Let us get those books out of our homes. Let's
get bookmobiles and get them into the homes of those children. And let
us get them to those Head Start Programs and make sure that all of our
children get that stimulation.''
That is what I am talking about today.

Marcus did not know how to write his name nor did he know
how to recite the alphabet. In a phrase, Marcus is not a part
of the culture of the school. He did not come to school ready
to learn. Marcus' teacher is concerned and anxious about him.
He is far behind his classmates, and she has little, if any,
time to help him catch up. As weeks progress, he falls
further behind and is more frustrated. Already Marcus hates
school and learning, counting the days until summer vacation.
He knows he is different. He knows he does not understand but
also knows there is not much he can do.

Here is a child who is utterly defeated. I meet children. I travel
the State. I travel the country and I meet with children who are age
10, age 8, who can't look me in the face, who look down. They have no
confidence. They don't believe they are going to be teachers. They
don't believe they are going to be doctors. They don't believe they are
going to be successful business people. They don't believe they are
going to be lawyers. They don't believe they are going to be
architects. They don't believe they are ever going to be Senators or
Representatives. None believe they will ever be President. They have
none of that hope. It is gone.
Can't we make a commitment as a Senate knowing full well
the importance of family and community? But can't we at least get some
resources for the communities and neighborhoods and families so that we
can support our children?

I will tell you something. I am absolutely convinced that when
historians write about this time period of the decade of the 1980's
moving into the decade of the 1990's, the ultimate indictment of our
country will be the way in which we have abandoned our children and
devalued the work of adults who work with those children. Think about
it for a moment.
I am not off the topic. I love to take my grandchildren to the zoo.
But if you work at the zoo, you get paid twice the salary, twice the
wage, that a woman or a man makes working in a child care center. We
pay people who work for the zoo twice as much money as we pay men and
women who work with children. What in the world does that say?
When I was a teacher at Carleton College in Northfield, MN, I would
meet students, and they would say, ``In all due respect, we do not want
to be college teachers. We want to work with these children when they
are young, 1, 2, 3, or 4 years of age, because we know that is such a
critical time.'' But many of them would then go on and say, ``But we
can't. We can't support the family. We would make $6 an hour with no
health care benefits.''
What are we saying? Let us dig into our pockets. Let us not spend
money on wasteful programs. Let us cut. Let us balance the budget. Let
us be fiscally responsible. But, please, let us make a commitment with
this amendment that we are not going to balance the budget on the backs
of poor children. Please let us invest in certain areas of life in
America, starting with our children.
Marcus' teacher said:

I just don't know what could be done for him. I know that
he needs a lot of one-on-one attention and love, but I just
do not have the time or the resources. Every day I feel him
slipping, and, frankly, it breaks my heart. He is a good boy
and a smart boy. I feel as if he is being punished for what
we did not do for him. I am worried that he will always hate
school and suffer until he can leave. He tries so hard.
Sometimes I want to cry.

That is what this debate is all about. It is about people. It is
about children.
I say to my colleague from Utah that I really believe there can be
100 Senators voting for this. I am not bringing this amendment to the
floor because I want to point the finger at other colleagues. I am not
bringing this amendment to the floor to force an embarrassing vote. I
am bringing this amendment to the floor in good faith and in good
conscience really hoping that my

[[Page S1161]]

colleagues will support it because, otherwise, I will just tell you,
given our track record of deficit reduction based on the path of least
political resistance, we are, with this constitutional amendment to
balance the budget, going to lock ourselves into very stoic priorities,
and we will make these cuts, and I believe in the absence of some
commitment, we will make cuts in these very programs that affect these
very children.

By August of 1996, in West Monroe, Louisiana, there was
already a waiting list for Head Start for August 1997. Zora
Cheney has been a Head Start teacher there since 1965. She
was there at the very beginning. Not only does she see the
need for it, but she lives the success. According to Zora,
without Head Start the lives of many children would be in
words ``a disaster.''

I visit Head Start programs all across Minnesota. Another outstanding
feature is parental participation--high-participation parents--in
meeting with the teachers and in talking about the children. This
program is a really important investment in poor children.

We get kids here, so many kids here, that need us and would
not endure later school years without it. I have seen some
kids who come in, and it is obvious they are not cared for
enough and that the home family needs help. While Zora's
program emphasizes the traditional things that we discuss
with Head Start, like building on language, learning shapes
and colors and developing social skills, it does so much
more. Says Zora, ``We are concerned with everything about
that child. We want the parents to learn how to feed them,
how to dress them, how to parent them.'' She continued, ``I
have had children come to school, and I know they have been
sleeping on the floor. I know they need so much at home. We
work with other groups. We refer the families to get things
like furniture and doctor appointments.'' When asked the most
significant contribution that Head Start in West Monroe,
Louisiana has made to the community Zora replies, ``For many
its the first place that they feel safe.''
I have other examples that I will go through tomorrow, but I just
wanted to give some examples of some children, and I am going to be
doing this over and over and over again, actually thanks to the people
in Minnesota--I am just going to bring to the floor of the Senate the
lives of children so that we can get some votes on their behalf because
I will tell you something. For example, the Senator from Utah--and this
is not meant to challenge him--on these children's issues he is
effective and he is a powerful Senator for children. I know that. So I
do not feel like I am spitting in the wind when I come out here to
speak or I do not think I make a mistake with this amendment. I am just
trying to get my colleagues to make this commitment because I know so
many of them care so deeply about children.
The amendment says we make a commitment that we will not put into
effect disproportionate cuts in programs that affect education--I
talked about that--nutritional and health care programs for children.
According to the Childrens Defense Fund, 10 million children, one in
seven children in America, are without any health care coverage at all,
and I think that close to about a million children a year have been
dropped from coverage because actually more and more people are getting
dropped from employment-based coverage, or what has happened, employers
will cover the adult but they do not cover the children.
It used to be that people could get coverage for everyone in their
family. Who are these 10 million uninsured children? Nine in ten, 88
percent, have parents who work. Nearly two in three, 64 percent have
parents who work full time. These are children of working poor
families. More than three in four, 77 percent, are white. Sometimes we
do a little bit too much by way of stereotyping and always assume we
are talking about African American people or Hispanics. Two-thirds live
in families with income above the poverty level, and more than three in
five, 61 percent, live in two-parent families. Each year since 1989--
this was the statistic I was struggling for--900,000 fewer children on
the average have received private coverage.
I think actually it is real important for me to make this point about
what this amendment is talking about and also some of the legislative
initiatives that will be taken in this Senate in the 105th Congress. We
are talking about working poor families. We are talking about people
who are not old enough for Medicare, and even if, by the way, you
receive Medicare in my State of Minnesota people do not have
prescription drug costs covered and elderly people still live in terror
of catastrophic expenses if they are no longer to stay at home and the
nursing home costs, or we are talking about families that are not poor
enough to qualify for medical assistance. They fall between the cracks.
They work, they work hard, they are barely above the poverty-level
income and they are not fortunate enough to have an employer that
provides them with health care coverage. So their children are at risk.
These families live paycheck to paycheck.
What does this translate into? More than half of uninsured children
with asthma never see the doctor during the year. More than half of
uninsured children with asthma never see the doctor during the year.
Many of these asthmatic children are hospitalized with problems that
could have been prevented. One-third of uninsured children with
recurring ear infections never see the doctor. Many suffer permanent
hearing loss. Children with untreated health problems are less likely
to learn in school. If you have an ear infection, if you suffer
permanent hearing loss, if you are not treated for asthma, if you do
not have dental care, if you come to school with an infected tooth,
with a tooth with an abscess and you cannot even get dental treatment,
you are not likely to do as well in school.
Mr. President, it will actually save money when we invest in
children. Each dollar invested to immunize a child saves between $3.40
and, some say, $16 in direct medical costs, and it goes on and on. In
every other advanced economy children get better health care coverage
than in America.

So, Mr. President, here we have children with undiagnosed vision
problems who do not get glasses and do not even see the blackboard. We
have children who suffer from asthma, we have children who have ear
infections and can suffer hearing loss, we have children who are in
pain and discomfort and have trouble concentrating, we have children
who are not treated early for lead paint poisoning and these children
can suffer permanent mental retardation, and we have 10 million
children in America who are uninsured.
Given this shameful statistic, is it too much to ask my colleagues to
make the commitment that in our effort to balance the budget we are not
going to make any disproportionate cuts that affect the health care
status of poor children in America? We are not doing near enough right
now.
That is all this amendment does. I am fearful, on the basis of what
we did in the last Congress, that when push comes to shove, we will not
have a deficit reduction plan locked in by this constitutional
amendment to balance the budget based upon a standard of fairness, that
we will embark upon once again deficit reduction based upon the path of
least political resistance, and those Americans who will
disproportionately be asked to sacrifice are the very Americans who
cannot tighten their belts any longer--poor children in America. This
amendment goes to the very heart of who we are and what we are about.
I do not know. My colleague from Utah may speak to this. Maybe there
is a strategy on the other side--not the other side as if we are not
friends, but we have majority party and minority party. I am in the
minority party--to basically vote against all the amendments. I hope
not. And one more time, I really hope that we will have an up-or-down
vote on this amendment. I introduce this amendment with respect for
colleagues. I think it speaks to a terribly important matter. I really
hope that people will vote for it. I really believe most Senators agree
that these are not the areas where we are going to make
disproportionate cuts. I really think most Senators agree.
Mr. President, I will speak more to this amendment, but for right now
I yield the floor.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah is recognized.
Mr. HATCH. Mr. President, I wish to express my regard for the
distinguished Senator from Minnesota. He is very sincere, and he always
means well, and, frankly, I care a great deal for him.
Having said that, I do want to point out that this is a
constitutional amendment we are talking about here, and I need to take
just a few minutes to respond to some of the comments

[[Page S1162]]

that my friend and colleague, Senator Wellstone, has made.
Let me begin by saying that I do not know of any other Member of this
body more genuinely concerned about the children in this country and
particularly those in poverty, unless it is myself. He works hard for
these unfortunate people, these unfortunate kids, as do a lot of us,
and I give him credit for that. When Senator Wellstone speaks on these
issues, he speaks from his heart, and we all know that. Regardless of
the differences on this amendment, you still have to give him credit
for that.
Having said that, Mr. President, the efforts to try to help children
by exempting programs that affect them from the balanced budget
amendment's purview will have precisely the opposite effect. As a
matter of fact, we are throwing their future away unless we pass this
amendment. We are saddling them with historic debt that literally is
going to cause them to spend the rest of their lives working to get out
from under the debt that we in our generation are leaving, or should I
say the past generations because it is more than just our generation.
The Senator has circulated a new section 8 that would become part of
this amendment if it was passed. Let us have no illusions. Senator
Wellstone, the distinguished Senator from Minnesota, is not going to
vote for this constitutional amendment no matter what happens, even if
we accepted this section. But we could not, because this section says:

He has circulated a whole number of amendments exempting the Women,
Infants, and Children Program, a program I support, Head Start, a
program I support, and education positions which I support. His current
amendment exempts, as it says here, outlays for education, nutrition
and health programs for poor children from disproportionate cuts.
If we care about children in this country--and I know we do; I don't
think there is a person in the Senate who would not say that he or she
cares--the most important thing we could do is pass this balanced
budget amendment. Without it, it is our children and our grandchildren
who will inherit the legacy of these astronomical debts, and they are
going up by leaps and bounds. It is our children and grandchildren who
will be called upon to pay the price for our years of profligacy, and
they will pay that price with higher taxes, higher interest rates,
fewer jobs, and economic instability. Thus, the amendment that we must
support in order to save the children is not one which would gut the
balanced budget amendment. To ensure the well-being of future
generations, we need to pass the balanced budget amendment. It is the
only hope for our children.
One of the things that is difficult for me to understand is why some
would argue or assume that exempting certain programs from the balanced
budget regime would somehow save or help those programs. Just the
opposite is the case. If there is a program worth preserving, and I
suggest those programs are, we ought to make sure these programs are
funded responsibly and not with rubber checks. What is the point?
Exempt a program from the budget so it would be allowed to go bankrupt
on its own? Is that what the point is? That is simply the kind of
reasoning that has led us to a $5.3 trillion national debt, going to
$5.4 trillion in the next couple of months.
Mr. President, several self-proclaimed liberals are making these
points as well as myself, notably Representative Joseph Kennedy, among
others, the Representative from Massachusetts. They have become staunch
supporters of the balanced budget amendment. Joe Kennedy is one of them
because, as a self-professed liberal, he believes and other liberals
believe, who are supportive of the amendment, that balancing the budget
is the only way to protect and preserve the worthy programs for the
needy. We are not doing anyone any good by bankrupting the Government
and spending an increasing amount on interest on debt. Representative
Kennedy last week suggested that interest was the primary villain,
crowding out good social spending programs. Imagine what we could do
with the hundreds of billions of dollars we spend on interest every
year?
No, the way to ensure the preservation and stability of critical
programs and help the most needy in our society is to foster fiscal
integrity. This is not the first time we have seen an amendment that
sought to carve out a loophole in the balanced budget amendment, nor
will it be the last. But I would like to ask my colleagues to consider
what the balanced budget amendment would look like if we really did
exempt all of these different parts of the budget because we like some
parts better than others. Anything affecting children, gone; seniors,
gone; investments, disasters, all manner of social spending, all gone
from the amendment if these folks have their way. So what is left? What
would those who propose this barrage of exemptions and loopholes leave
under the balanced budget amendment? Absolutely nothing. And everybody
on this floor has some favorite program, that is what has led us to
this morass and this mess. We all would like to save something. We all
would like to do something.

I have to say, it is pretty hard to fight against children's
programs. I don't know anybody who wants to do that, and if they have
to compete, they will compete very well and respectably for their share
of the Federal budget. They always have and they will. I have to admit,
I wish there was more money for these programs. I wish I could do more
for those programs. But the best thing I think I can do for them is
pass a balanced budget amendment that puts the fiscal responsibility
into this system.
Look, what do they leave under the balanced budget amendment?
Nothing? That is what it all comes down to. These kind of amendments
tug at the heartstrings of all Americans, and they try to make those
who sponsor the balanced budget amendment look mean. But the truth is,
if you really care about children, senior citizens, and disaster
victims, you will vote for the balanced budget amendment. You will vote
for a Federal Government with the fiscal strength to be there for them.
You will vote for a balanced budget amendment because, without that,
you will never be able to protect these programs and these people. And
you will vote for a balanced budget amendment without loopholes such as
the distinguished Senator from Minnesota is sincerely advocating here,
because everybody deserves a balanced budget amendment. I hope we
reject these amendments and pass Senate Joint Resolution 1 as it is
before us.
Additionally, I am not clear on the effect of the amendment of the
distinguished Senator from Minnesota. This Wellstone amendment states
that it is the policy of the United States that, in achieving a
balanced budget, there should not be disproportionate cuts to poor
children's programs. What is this, a sense-of-the-Constitution
resolution? Is that what we put in the Constitution? I don't think so.
I know it is not intended as an insult, but it kind of is, in a way,
by suggesting we are not going to do right by our children. The
distinguished Senator says we are not doing right now by our children
because there is just not enough money. I can agree with that. I can
agree I wish we had more money, I wish we could solve every social
program there is. But no nation on Earth has ever completely solved
them, and certainly no nation that is not fiscally responsible. And
ours is the most fiscally responsible Nation in the world, or at least
it has been up to the last 60 years.
In the last 60 years--in just the last 28 years, we have had 28
straight unbalanced budgets that are demonstrated by this. We have two
piles here, one behind the other. It would be a lot higher than double
my size if we put the other pile on top of this one. These are
unbalanced budgets over each of the last 28 years. That is only part of
it. We have only balanced the budget 8 times in 66 years. No wonder we
cannot do enough for our children. No wonder we do not have the money
to take care of these social needs. It is going to get worse and the
people who are going to get hurt the most are children.
Look at Social Security. When I talk to seniors, there are those who
want to

[[Page S1163]]

take Social Security out of the purview of the balanced budget
amendment, and that will be one of the big votes on this amendment. I
talk to seniors. They are concerned about children, too, and they are
concerned that most all the social spending now is going towards
seniors, and very few dollars are going to children. Part of that is
because we do not have a fiscally responsible Congress that has to try
and divvy up the money so they work in the best interests of all
Americans.
Now, we have had a Congress that just said, ``Just keep borrowing and
just keep spending and you can just keep doing that ad infinitum,
forever.'' We all know that is not the case. Our priorities do shift
from time to time.
Again, I get back to the Wellstone amendment, is this a sense-of-the-
Constitution resolution? What does ``disproportionate'' mean? My gosh,
do you realize what constitutional authorities would do with a word
like that? What does that mean? Does this limit across-the-board budget
cutting? Is that what it does? Our priorities shift from time to time,
as we do the budgets. Congress has to be free to allocate resources
within a balanced budget rule. It has to be free to do that. We cannot
write something like this into the Constitution.

How do we decide what is disproportionate? To senior citizens, they
might think that spending on children is disproportionate, rather than
spending on them. To children's advocates, spending on seniors is
disproportionate to what we should be spending on children. We have to
battle these things out. That is what we are elected to do. But we need
to do it within the constraints of a balanced budget amendment so we
really get down to the matter of setting priorities.
I happen to believe if we set priorities, the distinguished Senator
from Minnesota will be right in there pitching for the priorities of
children, and so will I.
(Ms. COLLINS assumed the chair.)
Mr. HATCH. Madam President, I think we will be able to win on this,
to the extent we have the votes to win it.
Furthermore, on this disproportionate business, how do we decide
which programs affect children? Do we do it on the basis of program
title, or by surveying recipients to see the actual use of the money?
Is that how we do it?
Madam President, it is pretty clear that if you put something like
this in the Constitution, you create more problems than you solve. It's
pretty clear that if you start advocating for any one select part of
the budget to be outside the budget, because you want that protected
from budgetary restraint, that you are hurting everybody. It's pretty
clear if you prefer one group over another, you're going to have a lot
of conflict among groups.
If you do that, you darn well better do it within a balanced budget
constraint, so the people know what is going on, and not just think the
money is going to come from somewhere, which is about the attitude we
have had around here for the last 60 years, and certainly for the last
28 years, every year we had an unbalanced budget. And in current years,
where we said this is a balanced budget for the first time--give me a
break, not one of them has been and nobody has thought any would be.
I have to tell you, I think it is going to be a budget charade this
year as well. The President's budget, according to CBO, is already $66
billion in debt, and the budget will be balanced in the year 2002, that
is assuming current interest rates, that is assuming current rosy
scenarios, that is assuming we continue to have no minor or major
recession. All of those things are ifs.
We should reject this and similar amendments and pass the balanced
budget amendment that will lead a stronger future for our children and
grandchildren away from bankruptcy and debt, which is where we are
headed if we don't get smart and do what is right. To exempt anything
from the budget is almost an insult to everybody who serves. It is an
insult to everybody who serves in the Congress.
We are here to try and do what is right. I believe the distinguished
Senator from Minnesota, myself and others, who similarly feel the depth
of these problems, will be able to fight very, very well for these
particular items in the budget, but within a balanced-budget concept.
If we do that, I think we will have more money in the end, more real
dollars to help children than we are going to have if we don't pass
this balanced budget amendment. So I hope that our colleagues will vote
this down.
Just so people will know right off the bat, I probably am going to
move to table every amendment that comes up. I don't want anybody to
feel badly about it. We think that is the only orderly way to proceed.
Mr. WELLSTONE. Will the Senator yield?
Mr. LEAHY. Madam President, if I might make a comment to the Senator
from Utah.
Mr. HATCH. I will be happy to yield for a comment.
Mr. LEAHY. Obviously, he has his right, as any Senator does, to move
to table any amendment.
Mr. HATCH. That is what we have always done.
Mr. LEAHY. But I hope no person in the public will be fooled by that.
The result is still going to be the same as an up-or-down vote would
be.
Madam President, the Senator from Utah has virtually a blood oath
from the Republicans to vote against anything that might try to protect
Social Security, children, or anything else in this proposed
constitutional amendment. So he would have the votes, I assume, to win.
But I hope the American public will not think this is a procedural
thing. This is very much a vote on the merits on any motion to table
that the Senator from Utah might make to defeat an amendment.
He does have an absolute right, as any of us do, to move to table at
some appropriate time. I hope he will allow enough time, of course, for
debate, but he does have that right. But the vote on that motion to
table should be viewed as if it were a vote on the merits.

I further ask the distinguished Senator from Utah how much longer he
will take.
Mr. HATCH. I will only be a minute. I will say this, I agree with the
Senator. The fact we move to table an amendment doesn't necessarily
mean the substance of that amendment or the substance of that vote
should be ignored. It is just a procedural way of handling the matter
that I think we are going to have to do in an orderly way. But I think
the vote will still mean who voted for it and who voted against. I
always felt that way. I don't have any problem with that.
I also would just like to say that I don't think there are any blood
oaths around here either. I hope some Democrats who have cosponsored
and my fellow Republicans will vote to sustain the motions to table,
but I don't know of any blood oaths, nor do I know of any all-profound
commitments that people have made. I just believe that people know this
game is about to come to an end and that this is a chance to pass a
balanced budget amendment to put our fiscal affairs in order, and that
this is the last chance. This involves both Republicans and Democrats
who have worked hard to come up with this consensus amendment in the
best interest of our country. I understand there are different
sincerely held beliefs on this matter. But in any event, I do not agree
with my colleague.
Mr. WELLSTONE. Will the Senator yield for a moment?
Mr. HATCH. Yes, I yield.
Mr. WELLSTONE. I know the Senator from Vermont wants to speak, and
then I will, after the Senator from Vermont speaks, respond to some of
my colleague's points. I don't understand, I will say to my friend from
Utah, he talks about tabling the amendment because this is an orderly
way to do it. I don't understand why an up-or-down, yes-or-no vote
isn't just as orderly. What is the problem with an up-or-down vote as
opposed to tabling? It is just as orderly.
The second thing--I guess it is less a question, and I don't know if
my colleague, who is a good friend, meant it in this way--I don't think
this is a game. This is less a question than, I guess, a response. I
don't think it's a game at all. I don't think it's a game to these
children, and it is not a game to me. I just want to be clear about it.
It is an amendment offered out of respect. It is an amendment that I
believe is profoundly important for our country. It is an amendment I
hope Senators will support. It is not a game. It is not a game.

[[Page S1164]]

Mr. HATCH. Madam President, it may not be to the distinguished
Senator from Minnesota, but I really believe it is time to pass a
balanced budget amendment, and this is the context in which this is in.
With regard to tabling, we have always done it and intend to table
the amendments if we can, and that is a right that we have. It is not
meant to hurt the Senator or his position, it is just a matter of
procedural choice, which I--and I just want to make it clear up front--
will probably do on all, if not most all, amendments that come before
the body on this matter.
I realize the distinguished Senator from Minnesota is very sincere,
that he would not bring this amendment to the floor if he didn't mean
it and it wasn't meaningful to him. I am not meaning to disparage his
amendment at all, other than I think it would be a terrible way of
writing the Constitution, putting words in the Constitution that would
be almost impossible to define and I think would, basically, gut the
constitutional amendment.
Even if we put it in, even if somehow or another we could find some
way of putting it in the amendment, I don't believe we would have the
vote of the Senator from Minnesota anyway.
To make a long story short, it is one of a long series of amendments
that are intended to defeat the balanced budget amendment, and I hope
my colleagues will vote to table.
Mr. LEAHY addressed the Chair.
The PRESIDING OFFICER. The Senator from Vermont.
Mr. LEAHY. Madam President, normally, I would speak in response to
this, but I understand the distinguished Senator from Texas needs a few
minutes to introduce a bill. Without losing my right to the floor, I
yield to my distinguished colleague from Texas.
The PRESIDING OFFICER. Without objection, it is so ordered. The
Senator from Texas.
Mrs. HUTCHISON. Thank you, Madam President. I thank the Senator from
Vermont.
(The remarks of Mrs. Hutchison pertaining to the introduction of S.
294 are located in today's Record under ``Statements on Introduced
Bills and Joint Resolutions.'')
Mrs. HUTCHISON. Thank you, Madam President.
I yield to the Senator from Vermont and appreciate his willingness to
let me introduce this bill on the day the officer is being buried.
Thank you.
Mr. LEAHY addressed the Chair.
The PRESIDING OFFICER. The Senator from Vermont.
Mr. LEAHY. Madam President, I should note a couple things from the
debate that my good friend from Utah has stated. He said he is in favor
of a balanced budget amendment. I know he has been very sincere about
that. My difference is I am in favor of a balanced budget. The two are
not necessarily the same. We have been voting closer and closer to a
balanced budget each of the last 4 years.
We have seen, after the enormous increase in deficits and the
national debt that grew up with Presidential budgets throughout the
1980's, for actually 12 years, beginning in the early 1980's straight
through 1992, where we saw a tripling of the national debt--I do not
want to sound partisan, but I point out those were all Republican
budgets and Presidents, Republican Presidents who got virtually every
single thing they ever asked for. In fact, the only appropriations bill
that President Reagan ever vetoed--the only one--was one that did not
spend as much money as he wanted. Yet he had, with his budgets, nearly
doubled the national debt. The debt had taken 200 years to build up to
the point where he became President. Within 8 years he doubled it. It
was nearly tripled by the time his successor, another Republican,
finished office.
So we actually built up the debt during that time--we are spending
over a half a billion dollars every working day just in interest on
that. We would not have a deficit today had there not been so much debt
built up during the Reagan and Bush administrations.
In the last 4 years, under President Clinton, the deficit has come
down every single year. No President, Republican or Democrat, has done
that in my lifetime. I think he ought to get some credit for it. Now he
has submitted another budget that will bring it into balance by the
year 2002.
We have endured a number of gimmicks, from the dumping of thousands
of dollars of cash on the ground to even a debt ticker. Now we have
this stack of books being represented as the unbalanced budgets of the
last 28 years. They are not the budgets for the last 28 fiscal years.
Let us make this very clear. The stack of books over there are not the
budgets for the last 28 years. They are not the budgets of the United
States at all. The stack of books are a mishmash of documents. Some are
proposed budgets by past Presidents. Some are proposed appendices of
the proposed budgets. Some are simply analyses of the proposed budgets.
Actually, the stack is as much a gimmick as a constitutional amendment
to balance the budget is a gimmick--as everyone from the Wall Street
Journal, on the right, to newspapers like the Los Angeles Times and the
Washington Post, more to the left, have pointed out.
In fact, here is a copy of last year's budget resolution. It is a
little tiny thin thing. This, incidentally, brought the deficit down
for the fourth year in a row. It is not a very picturesque thing. It is
not a gimmick. It is actually something we vote on. And by voting on
it, we brought the deficit down.
President Clinton made it very, very clear. All it takes to balance
the budget is our votes and his signature; not a constitutional
amendment. It also takes some courage on our part.
Many of us have shown that courage over the last 4 years in bringing
down the deficit. I am proud to be one of those. I am proud to be one
of those who voted against the economic plan that built up those huge
deficits in the first place. Because we are willing to cast specific
votes is why I support the amendment of the Senator from Minnesota,
Senator Wellstone.
I share his strong commitment to keeping America's children healthy
and strong. He has stated this not just on the floor of this body but
in individual talks with Senators. It is a deeply held view on his
part. As one who has chosen to protect the lives of those in the next
century, I share his view of that. I believe in strong families and a
strong family structure in this country. Families prosper only if their
children go the bed fed, not when their children go to bed hungry.
Last Congress, we had this Contract With America--or contract on
America. It seems like deja vu all over again. If you read the fine
print of that contract, as the Senator from Minnesota has, and the
balanced budget plan in there, it repealed the School Lunch Act that
provides lunch to 26 million children. The Contract With America
legislation repealed the WIC Program, special supplemental nutrition
program for women, infants, and children, that provides nutritious
foods to 6.9 million women and children. That Contract With America
legislation repealed the Food Stamp Program, which is a nutritional
safety net, a very modest one for 28 million people.
Now we beat back the repeal of the School Lunch Act with the help of
the Senator from Minnesota. We beat back the repeal of the WIC Program
with the help of the Senator from Minnesota and we beat back the repeal
of the Food Stamp Program with the help of the Senator from Minnesota
and the Senator from North Dakota and others who were here on the floor
today. We beat them back because people saw what was in the so-called
Contract With America.
But with the balanced budget amendment you do not see how this is
going to be done. Nobody wants to bring up the enabling legislation,
the details for future Congresses, or most likely for unelected judges
to decide. How can we guarantee--I will ask this question of the
Senator from Minnesota, is there any way you can guarantee that we
would not repeal the School Lunch Act or the WIC Program or the Food
Stamp Program without at least some of the protections of your
amendment? Is there any way we can be sure we protect them?
Mr. WELLSTONE. Madam President, the answer is no, absolutely not, on
the basis of what was attempted. Also on the basis of some of the cuts
made in the last Congress, the evidence is quite to the contrary. The
evidence is, in the absence of some assurance and some sort of
commitment in spite of all the

[[Page S1165]]

speeches made and words uttered, we will make disproportionate cuts in
the programs that affect health, nutrition, and educational status of
these children.
If the Senator from Vermont would not mind if I go on briefly and
respond to some of the comments made by my colleague, the Senator from
Utah. First of all, sort of a clarification about how you define
``disproportionate.'' It is pretty simple. Again, the evidence, and I
am interested if somebody wants to argue with it, in the last Congress
93 percent of the budget reductions in entitlements came from programs
for low-income people. Madam President, 93 percent. All you need to do
is figure out the percentage of the overall entitlement programs that
are low income and you do not cut by more than that.
We have the same thing with discretionary. You do not have to be a
rocket scientist to understand what the amendment says. You cannot
dance around it. Second, in all of the amendments we introduced and all
the amendments that the majority party is introducing, in this whole
constitutional amendment there will be implementing legislation to work
out the final details.
Third, Madam President, as to the Constitution and whether you can
have policy in the Constitution, I am not a lawyer, but article III
says:

The judicial power of the United States, shall be invested
in one supreme Court, in such inferior courts as the Congress
may from time to time ordain and establish. The Judges, both
of the supreme and inferior Courts, shall hold their offices
during good Behaviour, and shall, at stated Times, receive
for their Services a Compensation which will not be
diminished during their Continuance in Office.

It certainly seems as if we have such policies in the Constitution
right now.
Madam President, what troubles me the most about the comments of my
colleague from the Senator from Utah, first of all, he talks about this
amendment giving an exemption. There is no exemption. This amendment
just says give them what we did last time. Make a commitment that we
will not disproportionately cut programs that vitally affect the
nutritional, educational, and health care status of poor children in
America. I gave examples of those programs in the way they work and
what they mean to children. That is all it says and no more. Senators
should be clear on what they are voting on.
Finally, Madam President, and I want to be clear if I could get the
attention of my colleague from Utah, I do not want him to think I say
this without giving him a chance to respond, but in all due respect to
my good friend from Utah, when we talk about bringing the deficit down
and real interest rates down, and that is the way to help children, a
lot of the children that I have talked about, Senator, do not have that
future. If we do not make a commitment that we will make sure that they
have adequate diet, adequate nutrition, that they come to school
prepared to learn, that they come to school in good health, they are
not going to have this future.
For gosh sake, we should not in the name of deficit reduction savage
poor children in America today. You do not want an up-or-down vote? You
will vote to table. Fine. But this amendment is substantive. It speaks
to the very real problem of the deficit reduction based on the path of
least political resistance, picking out the most vulnerable citizens.
If we do not make a commitment that we are not going to cut these
programs that are so vital to poor children's lives--as a matter of
fact, we should be investing much more--then these children do not have
a future.
Deficit reduction, I am all for. Balancing the budget, we should do
it. But instead of focusing on poor children in America, why do we not
focus on the subsidies that go to oil companies, tobacco companies,
pharmaceutical, big insurance companies, and a whole lot of other
corporate welfare? Why do we not focus on the $17 billion over 2 years
more than the Pentagon requested wanted for the Pentagon? There are
other places to make the cuts, but I say to my colleague from Utah, and
I am sorry to say with indignation, this is anything but an abstraction
to the children I am talking about.
Your argument about how the best thing for these children is to make
sure we balance the budget because real interest rates will come down--
by the way, the Federal Reserve ought to bring the real interest rates
down right now if everybody is right, I am not sure they are about the
Consumer Price Index having overstated inflation, what in the world are
we talking about even the possibility of real interest rates going up?
They ought to be going down. Above and beyond that point, it does not
do the children that I am talking about today one bit of good to talk
about balancing the budget in the future when you balance the budget on
their backs. That is what we did the last Congress. That is what we did
the last Congress.
I am just saying, Senators, we should do this on the basis of some
standard of fairness. I still think I can get 100 votes for this. I
hope the Senator from Utah tomorrow, after we have a little bit more
time for final debate, will not move to table this. I hope he will
support it. With all due respect, the evidence does not suggest that
with the absence of this assurance we will not make these cuts in
exactly these decisive areas of life that so crucially affect the
quality, or if we do not make this commitment, the lack of quality of
the lives of poor children in America. I yield the floor.
Mr. HATCH. Madam President, I know there are 2 minutes left before we
end debate on this amendment. I acknowledge my colleague is sincere. It
does not negate the fact we have to live within budget constraints or
this country will go down and children will be the first to be hurt.
That is why this amendment is so important. You cannot make any
exceptions.
If you make exceptions, then it does not become important. It does
not work and it will not be the constraint that we need, it will not be
the fiscal discipline, that it will make a difference whether this
country really continues to be the greatest country in the world or not
and whether it can do for children and families what we would all like
to do. The best thing we can do is pass this amendment and pass it
without exceptions, like my good friend who is very sincere thinks we
ought to do.
I just want to bring that to the attention of everybody, that it
takes guts to stand up and do what is fiscally responsible, because it
is easier to offer spending through all these constituencies then it is
to have to make priority choices. This amendment will force us to make
priority choices. I think that is critical in any kind of nation that
really wants to call itself great.
The PRESIDING OFFICER. The Senator from Colorado is recognized.
Mr. ALLARD. Madam President, last week I talked about the balanced
budget movement from a historical perspective. I discussed the fact
that when our country started out as a new nation, policymakers felt a
moral and ethical obligation to balance the budget year after year
after year, and they did that. However, as time evolved, a process was
developed under which programs were funded based on demand. This
process produced what are called entitlement programs. It created a
blank check. As a result of these entitlements and the corresponding
lack of accountability, there is no longer the same concern to balance
the budget that existed during the time of the Founders.
I wanted to talk a little bit this afternoon from the perspective of
a family man who has grown up in America, from the perspective of a
small businessman who has had to start his business from scratch. Those
obligations that I faced as a family man and those obligations that I
faced as a businessman are pretty much the same obligations that we are
facing as a Congress, as the leaders of this country, this great
country called America.
Thus far, we have had two amendments presented before this body
which, in effect, provide for exceptions to a balanced budget
amendment. One is the Durbin amendment, and the most recent one is the
welfare amendment. These amendments are unnecessary. We already have a
provision to meet emergencies in the balanced budget amendment proposal
that is before us. Madam President, 60 percent of the vote in the House
and 60 percent of the vote in the Senate, or 261 votes in the House and
60 votes in the Senate, and we will be able to waive the provisions of
this amendment to meet those national emergencies.

[[Page S1166]]

Madam President, I understand I will have an opportunity later on to
continue with some of my remarks and that there is an order on the
floor for another amendment.
I will continue my remarks at another time.
I yield the floor.
The PRESIDING OFFICER. Under the previous order, the hour of 3:30
p.m. having arrived, the Senate will now proceed to the consideration
of the Durbin amendment No. 2, on which there shall be 2 hours of
debate equally divided.
Mr. HATCH. Madam President, I yield 8 minutes to the distinguished
Senator from Colorado, so he can finish his statement.
The PRESIDING OFFICER. The Senator from Colorado is recognized.
Mr. ALLARD. I thank the Senator for yielding. I would now like to
finish my comments that I began a few minutes ago.
The Wellstone amendment would provide funding for education,
nutrition, and health programs for poor children. So, again, as I was
speaking about earlier, I want to talk about this from the perspective
of a family man and also a small businessman. Joan, my wife, and I
started like most American families. After we got our education, we got
jobs. We earned a salary and worked hard to save money so that we could
incur our first major debt as a family. For most families in this
country, their first major debt is when they purchase a home. They are
able to incur that commitment only after they have enough income saved
up to go ahead and qualify to buy that first house.
Most families in America work hard to pay down that debt because they
understand that if they pay down that debt, then, in effect, they are
beginning to free up their resources so that at some later date they
can meet the educational needs of their children, the nutritional needs
of their children, and they can meet the health care needs of their
children. They also, hopefully will be able to save enough of their
resources to get their children started out in life. In addition, by
paying off that debt, they begin to build up a reserve in their home
that they will be able to use in case of emergency.
That is not unlike the situation that we have here in America. That
is why it is important that we get deficit spending under control and
that we have a balanced budget amendment that will say to the Congress
that it can't spend more money than it brings in.
Our debt today is greater than $5 trillion. Every year, for the last
28 years, we have continually added to that debt. We have been going in
a different direction than the average American family. If we really
want a better future for our children and grandchildren, we do not need
to establish more Government programs that will cause the deficit to
rise instead of fall. Instead, eliminating the deficit is the most
unselfish thing that we can do for our children and grandchildren.
Now, as a small businessman, a veterinarian, when I started out, I
had to go to the local banker to take out a loan. The largest portion
of that debt went to purchase a building so that I could take care of
my clients and their animals' needs. As time moved along, I worked hard
to pay down that debt that I had incurred. I knew that the sooner I
paid down that debt, the better I would be able to serve my clients
because a smaller debt load would begin to free up my resources for
other uses. Instead of paying out money on interest, I was able to buy
new equipment and bring in more help so that I could take better care
of my clients.
I think that these two situations, as a family man and as a
businessman, are not unlike what we face as a country. If we, as
Members of Congress, face our responsibility as custodians of this
country's future, we simply have to eliminate deficit spending. Despite
everybody's good intentions, the trend has been in the opposite
direction--our national debt has grown larger every year. I think that
the most unselfish thing we can do for our children and grandchildren
is to eliminate deficit spending and assure them a prosperous future.
That is why I am supporting a balanced budget amendment. The only way
that we will gather the courage and discipline to address our budgetary
problems is if we have a constitutional requirement to balance the
Federal budget.

Now, many will argue here on the floor that we need to protect
particular programs. And lots of times they will couch their arguments
in terms of certain benefits for our children. But what they really
want is to save their own jobs and programs. Because additional waivers
or exceptions to the balanced budget requirement will preserve the
deficit spending status quo, their primary concern cannot really be our
children's future. The balanced budget amendment and eliminating
deficit spending is the approach that concentrates on providing for our
children's future. It is unselfishly saying that we want a better life
for our children and grandchildren. That is why I am such a strong
supporter of a balanced budget amendment.
I wanted to share with Members of this body my experience as a family
man and a small businessman. I don't think that the Federal budget is
unlike what the average American family or small businessman faces on a
daily basis. They understand the need to eliminate deficit spending, to
pay down their debt. I just hope that this body has the same foresight
that many American families and small business people in this country
have.
I yield back the remainder of my time to the Senator from Utah. Thank
you.
Mr. DURBIN addressed the Chair.
The PRESIDING OFFICER. The Senator from Illinois is recognized.

Amendment No. 2

Mr. DURBIN. Madam President, it is my understanding that under the
order of the Senate, there is to be 2 hours of debate, if I am not
mistaken, with 1 hour to be controlled by me and the other hour by the
Senator from Utah, is that correct?
The PRESIDING OFFICER. The Senator is correct.
Mr. DURBIN. Thank you. I yield 10 minutes to my colleague from North
Dakota, Senator Conrad, at this time.
The PRESIDING OFFICER. The Senator from North Dakota [Mr. Conrad] is
recognized.
Mr. CONRAD. I thank the Chair and my colleague from Illinois.
Madam President, first of all, I thank him for offering the amendment
he has put up, which we will be voting on in just 2 hours. I think it
is a critically important amendment. Before I discuss that amendment, I
would like to talk about what I have heard here today, because I have
heard a lot of talk about how we are going to balance the budget. I
heard a lot of talk about how we are going to eliminate deficits, and
all of it is going to be done with this balanced budget amendment to
the Constitution.
I thought to myself, maybe they really don't know that, in fact, this
isn't a balanced budget amendment at all, because even if you pass this
amendment, the debt will continue to rise. Isn't that surprising? We
have heard all of this brave talk about how this amendment is going to
balance the budget. We have heard all of this talk about how it is
going to eliminate deficits. Yet, if we pass it, and if it is
implemented, the debt will continue to rise.
I asked June O'Neill, the head of the Congressional Budget Office,
when she came to testify before the Senate Budget Committee, ``What is
the deficit this year?'' She said, ``Well, Senator, the projected
deficit for this year is $124 billion.'' I said, ``Is that right, $124
billion?'' She said, ``Yes, that's the deficit.'' I said, ``Well, how
much is the debt going to go up this year?'' Well, she wasn't sure of
the number. I looked it up in a table before I asked the question. I
said, ``Well, would it surprise you to find out that the debt, subject
to limit, will be increasing $255 billion this year?'' She wasn't
surprised by that. Of course, none of us who serve on the Budget
Committee are surprised by that.
The difference is that the deficit they are talking about in this
amendment and the deficit she was talking about before the Budget
Committee is the so-called unified deficit. That is when you put
everything into the pot--all the income, all of the outgo, and you call
that the unified deficit. The problem with that is, every penny of
Social Security surplus is going in. That is about $70 billion this
year of trust fund money that they are using to say they have balanced
the budget.
That is not a balanced budget. In fact, by law, in the United States
that

[[Page S1167]]

is not a balanced budget. But they are going to put it into the
Constitution of the United States that it is. Is that really what we
want to do? Do we want to phony up what is a balanced budget and put a
phony description of a balanced budget in the Constitution of the
United States? Boy, I do not want any part of that game. Are we going
to say in the Constitution of the United States that it is a balanced
budget when you take every penny of Social Security surpluses and throw
those into the pot and call it a balanced budget? If any private
employer in this country tried to take the retirement funds of their
employees and put them into the pot to balance their operating budget,
they would be in violation of Federal law. That is called fraud. Yet,
that is what we are talking about here. Their defense is, ``Well, we
are doing it now.'' Yes, we are doing it now. We have been doing it for
13 years. It does not make it right. And it certainly is not something
we should put in the Constitution of the United States.
The first question the people of the United States ought to insist be
answered by our colleagues on the other side of the aisle is, What
budget is being balanced? We need to ask that question, the most basic
question of all, because by any serious definition of a balanced budget
this amendment to the Constitution of the United States that they are
offering is not a balanced budget amendment at all.
This is the description. It says, ``Total receipts shall include all
receipts of the United States Government. Total outlays shall include
all outlays of the United States Government.'' That seems to make
common sense. But the problem is that you are taking all of those trust
fund surpluses.
Look at what they are. In 1998, the fiscal year that we are working
on the budget, $81 billion of Social Security surplus. Under this
amendment that they want to put in the Constitution of the United
States, the organic law of our country, they want to take every penny
it of it to claim they have balanced the budget. In 1999, $169 billion
will be the cumulative surplus by that time of those 2 years; 2000,
$263 billion; 2001, $361 billion of Social Security surpluses, every
penny of it going into the pot to claim they have balanced the budget.
What a hoax. What an absolute hoax to call this a balanced budget. By
2002, $465 billion of Social Security surpluses, and they will have
taken every penny, they will have spent every penny, in order to claim
that they have balanced the budget.
That does not pass any kind of credibility test. For us to be
entrenching that principle into the Constitution of the United States--
I thought about this very hard 2 years ago when it came down to my
vote. I thought to myself, I don't know what the political
ramifications are. I don't know how this will be read. But I know one
thing. I am not putting my name on an amendment to the Constitution of
the United States, the organic law that has made this the greatest
nation in human history, and put my name on an amendment to the
Constitution of the United States that says that a balanced budget is
one that uses every penny of the Social Security surplus to call it a
balanced budget. No. I am not signing up to that kind of deal.
Look at what we are talking about. By the year 2013, $1.8 trillion of
Social Security surpluses, and they are going to take every dime and
claim they have balanced the budget.
Let me turn now to the amendment of my colleague from Illinois, an
amendment that I think is critically important because I think there
are three failures to this balanced budget amendment that is before us
today. No. 1, it raids Social Security surplus funds to claim balance;
No. 2, it does not have adequate provision for a national economic
emergency.
Madam President, we know right now that the right thing to do is cut
spending and balance the budget, without question. I have spent a great
deal of my time offering balanced budget plans in this Chamber. I
deeply believe it is the right thing to do to secure the economic
future for our country. There is a right way to do it and a wrong way
to do it, and unfortunately the amendment before us, the underlying
constitutional amendment, is the wrong one; wrong because it loots
Social Security trust funds; wrong because it does not have adequate
provision for national economic emergencies.
But let me be clear. While it is the right thing to do now to cut
spending and balance the budget, that was precisely the wrong thing to
do in the depths of the Depression. Cutting spending, raising taxes in
the depths of the Depression would only have made that calamity last
longer and be deeper. That is the economic reality. And we are passing
an amendment here not just for today, not for the next 5 years, not for
the next 10 years, but perhaps for the next 200 years. It ought to be
an amendment that can stand the test of time. This one, the underlying
amendment, fails that test.
The Senator from Illinois, Senator Durbin, has come to us and
recognized that we ought to amend the balanced budget amendment to take
account of national economic emergencies.
He is saying that when we get into a situation, especially a
depression, this country ought to be able to take fiscal policy that
would help this country emerge. The Senator from Illinois has put his
finger right on it, one of the key weaknesses of this amendment.

Henry Aaron, director of economic studies at Brookings Institution,
says, ``One does not need to be a primitive Keynesian to believe that a
requirement forcing tax increases or spending cuts during an economic
slowdown could be catastrophic. Yet, the need to mobilize a three-
fifths majority, not just in the Senate but in the House of
Representatives as well, heightens the possibility that such policies
would result because of incapacity to mobilize the necessity
supermajority in both Houses.''
Some of my colleagues on the other side who are moving this amendment
may say, ``Well, all we have to do is get a three-fifths vote to waive
these provisions in the event of a national economic emergency.'' I
think that is cold comfort, Madam President. All we have to do is look
back at some of the decisive moments in history to see that it isn't
easy to get a three-fifths vote in this Chamber. On the eve of World
War II we could not get a three-fifths vote to institute a draft. If
there ever was a national emergency, it was World War II, and we
couldn't get a three-fifths vote to institute a draft. In fact, we
couldn't get a majority vote to institute a draft.
Madam President, we don't want to hold the economic future of America
hostage at in a time of national economic emergency. That does not make
sense.
Robert Solow, the Nobel laureat from MIT, said, ``The balanced budget
amendment would force perverse actions by Congress, easily turning a
small recession into a big one and a big one into a disaster.''
We ought to pass the Durbin amendment because it makes economic
sense. We ought to do that.
This chart shows what we have learned in terms of evening out the
economic cycles. This chart shows real economic growth from 1870 to
1995. You can see these wide swings, these wild swings, in economic
activity up until about 1950. Then these economic stabilizers that we
put in force in this economy eliminated these wild swings that lead to
so much pain, so much suffering, and so much devastation. That is what
the Durbin amendment addresses. It says let us not eliminate these
economic stabilizers. Let us not be in a situation in which we handcuff
the American economy in the midst of a national economic emergency. Let
us not be in a circumstance in which we cannot do what we know works to
eliminate disastrous economic consequences. That just makes common
sense.

I hope we will support the Durbin amendment.
I thank the Chair and yield the floor.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah is recognized.
Mr. HATCH. Madam President, the Senator from North Dakota has been
very eloquent. The problem is that what he seems to be arguing for is a
continuation of the status quo. For instance, on Social Security, at
the very time he is arguing that it is immoral and that it is a rape of
the trust, that it is a ripoff to keep Social Security within the
purview of the balanced budget amendment, he supports a President who
is doing exactly that.
That is what the President's budget does. That is what every budget
of

[[Page S1168]]

every President has done ever since we started the unified budget
system. And it just makes little or no sense to take it out of the
Federal budget, out of the unified system, because if it cannot stand
on its own, which Social Security can, then why would we make any
selectivity. The fact is it is a gimmick to take it off budget, and it
is a risky gimmick at that. What they are trying to do is really defeat
the balanced budget amendment.
Then to argue that we have to take care of economic emergencies,
well, what are economic emergencies? I must be able to list at least
3,000 of them right now that could occur to which everybody could argue
that the balanced budget amendment does not apply.
It is one thing to argue for the status quo. I have seen 28 years of
it. I have been here 21 of the 28 years. And I have to admit I fought
for a balanced budget every one of those years, and there have been a
number of us who have done so, but we have been in a distinct minority
as unbalanced budget after unbalanced budget has been passed.
Now they are saying let us keep the status quo. Even though this
gimmick is going to take Social Security off budget and subject to all
budgetary matters, we should take it out of the balanced budget
amendment, as though Social Security cannot stand on its own. Come on.
That would be one of the most risky things we could do. Every item
ought to be on budget.
Social Security is the largest item in the Federal budget. It ought
to be in the budget. And we can work around the problems that are
concerning the Senator from North Dakota and others who argue that. To
talk about economic emergencies and try to write that into the
Constitution, everybody knows that is a gutting amendment that would
destroy the balanced budget amendment.
To say that you cannot get a three-fifths vote is an insult to
everybody who believes in this country and who is patriotic and who
really believes that the country should go forward. If we have a true
economic emergency, we will be able to get the three-fifths vote, and
there will be a lot of us who are conservative who will be voting for
the three-fifths vote.
The fact of the matter is if it does not measure up, then that three-
fifths vote will not be granted. And a lot of these very same people
will be saying, ``Oh, this is the most important thing in the world,''
as we go into another year of unbalanced budgets. That is what we have
been doing.
I hear these people saying, ``Oh, we can do it. Just do it. Just do
it.'' I have heard that for 21 solid years. We have never done it yet
in the last 28 years. What makes us think that ``let's do it'' means we
are going to do it the next year. The fact is the President's budget is
not going to be in balance, according to the CBO; the one he sent us is
not balanced. And keep in mind the last 2 years are where all of the
budget cuts have to occur in order to be in balance, according to the
President, or there will not be any tax relief to the American people.
So, look, we know that these amendments are intended to gut the
balanced budget amendment. People who are arguing for them may be doing
it sincerely, and I presume they are. But they are people who are not
going to vote for this balanced budget amendment no matter what we do.
They are not for it no matter what we do. We heard the distinguished
Senator from Minnesota. Why, he has four or five major items that he
would exclude from any budgetary restraint. There are others who would
exclude Social Security from any budgetary restraint. And there are 98
others in this body who would also like to exclude some of their
special projects.

The best we can do is work together on the unified budget and face
the music and make priority choices within a budgetary constraint
system, and if we do that we will save this country, we will protect
our children, protect our seniors, protect those who need it, and we
can. Otherwise, we are going to monetize the debt in order to stave off
bankruptcy, and that means ruining our country, having interest rates
going out of sight and inflation through the roof.
We are talking about saving the country right now. That is what we
are talking about. With these gutting amendments, if any of them pass,
the balanced budget amendment will become a lot less effective.
I yield the floor.
Mr. DURBIN. Madam President, I yield 3 minutes to the Senator from
North Dakota.
The PRESIDING OFFICER. The Senator from North Dakota.
Mr. CONRAD. Madam President, just to respond to my distinguished
colleague from Utah, the Senator from Utah says, well, it is OK for us
to put in the Constitution of the United States a definition of a
balanced budget which assumes that you are going to loot Social
Security trust funds, and every other trust fund, for that matter,
because the President did it in his budget submission.
I say that is a mighty weak defense of a constitutional provision. We
are not talking about a statute here. We are talking about the organic
law of the United States.
Mr. HATCH. Will the Senator yield on that point, just on that point?
Mr. CONRAD. Let me complete my thought, and then I would be glad to.
Mr. HATCH. If the Senator would.
Mr. CONRAD. Then I would be glad to yield.
The fact is we are talking here about an amendment to the
Constitution of the United States. This amendment does not lead to a
balanced budget. The debt continues to increase even if this is passed.
That is not a balanced budget, No. 1.
No. 2, the President's budget, which is done on a unified basis in
the same way as this constitutional amendment, is also not a balanced
budget. And I have said that clearly.
Mr. HATCH. Will the Senator yield?
Mr. CONRAD. I have said it publicly, and I have said it privately. It
is not a balanced budget, because although this amendment claims
balance and the President's budget claims balance, they are taking
trust fund money in order to claim balance. That is not a balanced
budget. It defies our own law. Our own law says you should not count
Social Security trust funds.
Second, the difference between Social Security and other funds is it
has a dedicated revenue source. We impose a tax, a regressive payroll
tax on the workers of this country and the employers of this country,
and that fund is in surplus. And so when you mix it in with everything
else, you are taking the surpluses generated by that stream of revenue
that is being generated for a purpose. The purpose is to prepare for
the baby-boom generation. But all the money is being spent. It is being
spent for another purpose. That is wrong. And it is dead wrong to
enshrine that flawed principle in the Constitution of the United
States.
Mr. HATCH. Will the Senator yield?
Mr. CONRAD. Third point. The Senator from Utah says three-fifths
vote, requiring that is an insult to those who serve here. Not at all.
It has nothing to do with insults. I could turn that on the Senator
from Utah and say his requirement of a three-fifths vote is an insult
to democracy. In democracy, majority vote prevails. We do not have
supermajorities. I do not choose to do that.
I do not think it is a matter of insult. I think it is a matter of
reality. Do we really want to be in a circumstance in which this
country faces an economic emergency and we have to have a supermajority
vote to respond when we know from our own past that it has been
difficult to muster a three-fifths vote. Even on the eve of World War
II, to institute a draft, we could not do it. I submit to this Chamber
and to the American public, the wiser course is the amendment of the
Senator from Illinois.
Mr. HATCH. Will the Senator yield?
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. Madam President, I listened to these arguments, and I did
not make the argument that we should have Social Security in the
balanced budget amendment because the President is doing it. Everybody
has done it because it is a unified budget that requires everything to
be on budget. And on the other side of that coin, starting about the
year 2014 Social Security goes in deep deficit. What are we going to
do, keep that off budget so that we do not have to face the music, so
we can keep borrowing?
The PRESIDING OFFICER. The 3 minutes of the Senator from North Dakota
have expired.

[[Page S1169]]

Mr. HATCH. I will use my own time. I am sorry.
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. The fact of the matter is, you cannot budget without
putting everything on budget and you cannot handle it right. And the
President is doing what the Secretary of Treasury said he should do,
and that is keep all items on budget. There are 31 trust accounts, at
least in the Federal Government. Are we going to take them all off
because somebody makes the unfounded allegation that we are ripping off
the trust funds? The fact is, the only way not to rip them off is to
keep everything on budget. And that is a pretty important point.
I do not see how you can argue to take it off budget. It just makes
sense that we face all the music here, not just part of it, and that we
do not make any exceptions so that we have to make priority choices if
we are going to have a balanced budget amendment.

The Senator is right on one thing and that is this amendment does not
require a balanced budget. We can choose not to balance the budget. All
we need to do is get a supermajority.
This is not a pure democracy in this country. This is a
representative democracy, and the Senate is a perfect illustration of
how we do not always have a majority vote. The fact of the matter is,
each State has two Senators, regardless of population, and that gives a
disproportionate amount of voting power to some States over others.
The House of Representatives is a purer democratic body, and our
Founding Fathers in their wisdom understood this. They also would
understand, if you are going to do a balanced budget amendment, you
have to keep everything on budget. And it still does not rebut my
point, which is that this is a gutting amendment. This amendment
basically says when we have an economic emergency we can go off budget,
the amendment does not apply. Again, I ask you, what is an economic
emergency? There is a wide disparity of belief as to what is, and we
provide for a way around that by a three-fifths vote, which I think, in
a true economic emergency, will be easily obtained here and should be
easily obtained here.
In response to the supermajority requirement, the Senator from North
Dakota raises the vote on war, a military threat. Senate Joint
Resolution 1 provides a lower threshold for votes to waive the balanced
budget rule in times of war or national security emergency. With regard
to economic emergencies, during the past 15 years Congress has passed
emergency unemployment compensation by supermajorities every time but
once, and it can be legitimately argued that the once was a time when
they should not have. Disaster relief has been enacted by a similar
supermajority every time except twice over the last 7 years.
What is wrong with requiring people who have not balanced a budget in
28 years and who keep saying the same things, what is wrong with
requiring some fiscal restraint of these people? It is apparent that
Congress is not going to live with fiscal restraint unless it is
imposed upon them, and the only way we can impose it--after five tries
in the last few years of budget restraint by statute, none of which
have worked--the only way you can impose it is through an amendment to
the Constitution that everybody in this body and in the other body is
sworn to uphold. I think it is just that simple.
There is room for legitimate disagreement here, I am sure. I do not
mean to imply that my colleagues are not sincere in every word that
they are saying. But, on the other hand, I think those of us, the vast
majority in this body, who will vote for this are sincere as well. We
have seen 28 years of sincerity. People were sincere in trying to get
balanced budgets during those years, but they did not do it. The reason
they did not do it is because they did not have to do it and it was
easy to borrow. It was a lot easier to borrow and mortgage the future
of our children than it was to face the music. Our amendment will
require we face the music.
I yield the floor and reserve the remainder of my time.
Mr. DURBIN. Mr. President, I yield 1 minute to the Senator from North
Dakota.
The PRESIDING OFFICER (Mr. Allard). The Senator from North Dakota is
recognized for 1 minute.
Mr. CONRAD. Mr. President, words do not change reality. You can call
it a balanced budget amendment to the Constitution of the United
States. It is an amendment to the Constitution of the United States,
but it is not a balanced budget. The simple fact remains, if you pass
the amendment offered by the Senator from Utah and it is fully
implemented, the debt continues to go up. You can say that is a
balanced budget but it is not. It is simply not. The reason it is not
is because the Senator from Utah is taking every penny of the Social
Security trust fund surplus and throwing that into the pot and saying
he has balanced the budget. It is not a balanced budget. No private
employer could do that. It would be a violation of Federal law.

On the question of three-fifths vote, it is very interesting----
The PRESIDING OFFICER. The minute of the Senator has expired.
Mr. CONRAD. May I have 30 more seconds?
Mr. DURBIN. I yield 30 seconds to the Senator from North Dakota.
Mr. CONRAD. On this question of national economic emergency, it is
very interesting that all these arguments about supermajority go right
out the window because they themselves provide for a simple majority in
the case of a national security emergency but not in the case of a
national economic emergency. That is a fatal flaw in this amendment.
I thank the Chair and yield the floor.
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. Mr. President, I hear the distinguished Senator, but what
he fails to say is that we are continuing that system without any
restraint if we do not pass the balanced budget amendment. I think the
Senator from North Dakota, not deliberately, has made several
misleading statements, to some of which I would like to respond.
He says the balanced budget amendment does not balance the budget if
it does not exclude Social Security. Of course he fails to mention that
in the long run everyone knows Social Security is going to run huge
deficits and that it is not always going to run surpluses. This tends
to balance out. If we follow his suggestion, we do nothing but continue
the current system. His own President is including Social Security
because he has to, because it is part of the overall unified budget. By
the time today's children are retiring, Social Security will be running
annual deficits of $7 trillion each year. Unless we keep Social
Security on the budget and make it work and resolve it, in current
dollars, it will be a $7 trillion deficit a year.
He also fails to mention that this huge deficit would not count under
the Social Security amendment that he supports. The amendment he
supports would call this $7 trillion deficit a balanced budget. You
talk about hoax; I don't see how anybody can argue that. Yet they do.
The fact is, we are in trouble and what are we going to do? Just the
status quo? Just keep doing year after year what we are doing;
mortgaging our children's future and making it so this, the greatest
country in the world, becomes the least great country in the world?
That is where we are headed if we do not do something about it.
The Senator from North Dakota also described the balanced budget
amendment as looting Social Security. What a half-truth. The balanced
budget amendment does not touch one penny in Social Security. That
whole argument is nothing more than an accounting preference. The
Social Security trust funds will be still invested in the greatest
securities in the world, and that is American securities, U.S. Treasury
bills, if you will. That is the only thing they can be invested in.
That is going to happen whether we pass a balanced budget amendment or
if we do not. So, this is a phony argument and, frankly, it would be
literally--literally--a risky, risky gimmick to take Social Security
out of the major budget because, on the one hand, there are surpluses
today, but they are all invested in American securities. Starting about
the year 2013, we have huge deficits; not surpluses, but deficits.
Should we take it out when we have surpluses and not put it in when we
have deficits? No. You keep it in all the time and you work with it and
you

[[Page S1170]]

do what is right. That is what the Secretary of the Treasury did. That
is what he suggested. That is what he said is the right way to do it.
By the way, that is also what the President just did in sending up his
budget.
So, if we do nothing here, we have business as usual, another, a
29th, year of unbalanced budgets. I would feel a lot better if some of
these people who are bringing up these amendments would be voting for
the balanced budget amendment. But, no, these are amendments to gut the
balanced budget amendment.
I yield the floor and reserve the remainder of my time.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, could you please tell me how much time is
remaining to me?
The PRESIDING OFFICER. There are 42 minutes for the Senator from
Illinois, 38 for the Senator from Utah.
Mr. DURBIN. Mr. President, I thank my colleague from North Dakota,
Senator Conrad, for supporting my amendment and joining in the debate.
He has raised two very important issues. One relates to the future of
Social Security and its involvement in balancing the budget. The other
relates directly to my amendment, to whether a supermajority vote will
be required in the House and the Senate in times of a national disaster
or a national economic emergency for the Congress to decide to spend
more than we have received in tax revenues that year.
The Senator from Utah, the chairman of the committee, has spoken in
committee and on the floor. His point is made and made clearly. He
believes that Social Security should compete with all the other Federal
programs. He believes that it should be there with no special
treatment, should not be excluded, should be brought to the debate and
treated the same way. I respect his point of view. I disagree with it.
But in order to bring this back to my amendment, I would like to
focus on the debate which started last Thursday and continues this
afternoon.
Consider this possibility. If we are successful in balancing the
budget in fiscal year 2002, as proposed by President Clinton and
virtually all of the leadership in Congress, we will applaud,
congratulate ourselves and believe, I think rightly, that our economy
is in stronger shape. And now let's take a hypothetical.
In the next year, 2003, there is a downturn in the American economy.
This is not an extraordinary event. In fact, history tells us that once
every 5 years we face such a downturn. So our budget is in balance and
the next year, millions of Americans, because of this recession, are
out of work; men and women who have been paying Federal taxes, no
longer working. Naturally, they are not paying the taxes.
On the other side of the coin, they are men and women who need a
helping hand. They are men and women who need unemployment compensation
from the Government. They are men and women who may need, in dire
circumstances, food stamps to feed their children from the Government.
They may also need Medicaid for hospitalization care of their children
while they are unemployed from the Government. They may be determined
to go back to work and headed for a job training program to get them
qualified for another job, that training program coming from the
Government. They may decide it is time to get that advanced degree or
college degree and need to ask for a loan from the Government. In each
of these instances, people who are not paying taxes, working families
who, through no fault of their own, are out of work, turn to the
Government for a helping hand.
Any economist is going to tell you your books are not going to be in
balance that next year. Congress will then have to decide whether in
the year 2003, in this hypothetical, we will not have a balanced
budget, because we don't want to relegate millions of unemployed
Americans to the ash heap of economic history. We want to make certain
they have the same chance other families have had to get back on their
feet, and that is the purpose of the Durbin amendment.
How will we reach that decision? Under the amendment to the
Constitution being offered by the chairman, the Senator from Utah, it
would take a three-fifths vote of the House and the Senate, approved by
the President in order for us to decide, yes, in the year 2003, we are
going to waive the requirements of a balanced budget in order to get
the economy moving again, in order to get people back to work, not to
risk going more deeply into the recession.
The chairman stands and says this supermajority requirement, this 60-
percent requirement, is not unreasonable. Surely, he says, the House
and the Senate, faced with this economic challenge, will rise to the
occasion, cast partisanship aside, avoid the personalities, rally
around the flag, stand behind the families. I say to the chairman and
to others of like mind, history suggests it might not be that easy.
In the desk of each Senator is a publication known as the Senate
Manual. It contains a lot of information about the rules of the Senate,
and it also contains the Constitution of the United States.
I ask the chairman to consider the following: When our Founding
Fathers wrote the Constitution, which we are seeking to amend with this
resolution, there were 13 colonies organized under the Articles of
Confederation. And they said that 9 of the 13 colonies would have to
ratify the Constitution for it to go into effect.

Think about this: The birth of our Nation, the creation of the United
States of America, and turning to 13 legislatures in 13 colonies, this
Constitution was given to them, asking them to be a part of our Federal
system.
What if we had given them the Constitution with a supermajority
requirement in each of the legislatures? What if we had said to them,
``Just to make certain that you don't do anything rash, we are going to
require a 60-percent vote from the legislature of each colony to ratify
the Constitution, and it will take 9 of the 13 colonies to do it''?
Mr. President, I am not certain we would be a federal nation today,
because if you reflect on the votes actually cast in each of the 13
colonies, you will find, unfortunately, that 5 of the 13 did not meet
the supermajority requirement. Only 8 of the colonies would have met
the chairman's supermajority requirement.
So, though he believes we can rise to the occasion in economic
recession, history tells us that even in the creation of this Republic,
a supermajority requirement would have complicated things, slowed them
down. I don't know if we would be standing today on the floor of the
Senate of the United States of America. It is anyone's guess. But the
suggestion that a supermajority requirement is something easy to come
by belies history.
What my amendment says is that a majority is necessary to make this
decision. So, if we face a natural disaster--the big one in California,
a hurricane in Florida, a hurricane in North Carolina--or a national
recession, that we will come together as a national legislature and
decide for that given year we will waive the requirement of a balanced
budget because of a national economic emergency, a national disaster.
The chairman suggests people will abuse this. They are going to call
everything a national economic emergency. I don't think so. I think
history tells us over the last 4 years, with the Clinton
administration, with both a Democratic Congress and a Republican
Congress, there has been a real commitment to deficit reduction.
The chairman is standing next to his leaning tower of unbalanced
budgets and suggesting to us that this is going to go on forever. But
if the chairman would look closely over the last 4 years, he will see
they are somewhat different than the other 24 years, because we have
come to a bipartisan conclusion that we should and can reduce the
deficit in a responsible way.
President Clinton's administration, with the cooperation of a
Democratic Congress and a Republican Congress, have brought 4 straight
years of deficit reduction. This is the first time that has occurred in
this century and far into the last century. So it suggests Congress has
the message and has the goal in mind and is moving toward it in the
right way.
The chairman has said to us many times, this is something the
American people want, a balanced budget, and he

[[Page S1171]]

is right, not just by our empirical evidence of visiting our States and
speaking to our constituents, but also by sophisticated polling time
and again. People come forward and say, ``Let's have a balanced
budget.'' But I say to the chairman, I will also add a couple things to
that.
If you would ask them whether they want to protect the Social
Security trust fund as part of balancing the budget, they want that in
an overwhelming way.
If you would ask them whether or not it is right for our Nation to
come to the rescue of families unemployed in the midst of a recession,
for the Nation to come together to offer things to families to get back
on their feet, I think you will find an overwhelming response. Because
the bottom line for most American families, whose senses are dulled by
all this economic theory rhetoric, is whether or not they are doing
well for themselves.

Are people in their households working? Do they have a job? Do the
kids have a chance for a bright future? Is our economy expanding,
creating good-paying jobs? I think that really is a bottom-line
question. In election after election that is the test we are held to.
This amendment does not meet this test. This amendment, by requiring
a supermajority vote, says that this Senate of the United States and
the House of Representatives will hold itself to such a standard as to
question whether or not we can rise to the occasion when there is an
economic necessity.
Mr. KENNEDY. Will the Senator yield?
Mr. DURBIN. I would be happy to yield to the Senator from
Massachusetts.
Mr. KENNEDY. Mr. President, I strongly support the amendment offered
by Senator Durbin to protect jobs for working families. Without it,
millions of Americans may well lose their livelihood if adequate steps
are not taken to prevent real damage to the economy from the proposed
constitutional amendment.
Proponents of the balanced budget constitutional amendment claim that
it will help American families. They predict dire consequences without
a constitutional requirement to force a balanced budget. But, we know
better. President Clinton's budget gets us to balance by 2002, and
American families don't need or want to lock themselves into a
budgetary straightjacket.
Secretary of the Treasury Robert Rubin and over 1,000 economists have
told Congress that the balanced budget constitutional amendment is a
mistake. Because the amendment turns off the economy's automatic
stabilizers, ``it could turn slowdowns into recessions, and recessions
into more severe recessions or even depressions,'' according to
Secretary Rubin.
Without the automatic stabilizers, the Treasury Department estimates
that the 1990 recession might have led to 9 percent unemployment--
instead of 7.7 percent. That would have cost the country over 1 million
additional jobs.
The fundamental problem with the amendment is that it requires a
balanced budget even in times of recession. The depression of the
1930's was made far worse because Congress repeatedly cut Federal
spending and raised taxes trying to keep the budget in balance. This
amendment could easily condemn us to repeat that unacceptable history.
Surely, we can't ignore the views of over 1,000 economists who agree
that this amendment mandates ``perverse actions in the face of
recessions.'' The last time we failed to heed the warnings of the
Nation's economists, at the beginning of the 1980's, the deficit
skyrocketed and hundreds of thousands of Americans lost their jobs.
Of course, supporters of the amendment say this will never happen.
They tell us that if an economic depression is on the horizon, the
proposed constitutional amendment allows Congress to waive the balanced
budget requirement with a three-fifths vote. But it is reckless for
Congress to gamble in this way with the economy.
The Durbin amendment is needed to avert these serious threats to the
economy and to American families. Under the Durbin amendment, a
constitutional majority could waive the balanced budget amendment's
requirements if there is an economic recession or serious economic
emergency in the country.
The amendment protects the country during times of military
emergency, and it should also protect families during an economic
emergency. I urge my colleagues to support the Durbin amendment.
Finally, I want to ask the Senator a question, if I might.
I have listened with great interest to the Senator's explanation. I
find it enormously powerful and extremely compelling. After listening
to the interpretation of both the balanced budget amendment and the
Senator's anti-recession amendment, one has to draw the conclusion that
on the one hand Americans who have great wealth will not be
significantly impacted by the implementation of the balanced budget
amendment during a recession.
The very wealthy do not rely on the kinds of programs that you have
mentioned. So their lives will not be adversely affected if this
measure is actually put in the Constitution.
On the other hand, as the Senator has pointed out, working families,
children of working families, and parents of working families have the
greatest risk under this amendment. If I understand the position of the
Senator from Illinois, it will be the sons and daughters of working
families that will suffer because Pell grants will be cut. It will be
the children in Head Start--children of working families--that will
have their education put at risk. It will be mothers and fathers of
working families who will not receive assistance from job training or
job dislocation programs during times of economic calamities. It will
be their parents, those who have toiled in the factories, served in the
Armed Forces, lifted this country out of depressions, and been the
backbone of this Nation, whose Social Security and Medicare checks are
put at risk.
I wonder whether the Senator's arguments reach this issue of
unfairness inherent to the balanced budget amendment. Because, it seems
to me that one group of Americans, those hard-working Americans, have
the most to risk. And those that are the wealthiest individuals or the
most successful corporations have the least to risk. I wonder whether
the Senator agrees with that observation.
Second, if the Senator believes that is true, then what does he
believe is the position of the organizations that represent working
families.
Where do the workers stand on this? Are they for this? Do they think
that their futures are more secure by putting the balanced budget
amendment in the Constitution? They say no.
What about those groups that have fought for the rights of children,
day in and day out, year in and year out, what is their position? Do
they say yes? They say no.
Do those groups that have been fighting to ensure decent health care
for American seniors come to us and say, ``This balanced budget
amendment is in the best interest of our seniors,'' or do they say,
``Do not pass this measure, at least not without the Senator's
amendment?''
I am just interested if the conclusions that I draw from the
Senator's excellent argument, particularly as it relates to the adverse
impact economic downturns would have on hard-working Americans, is
something that the Senator is very concerned about as well.
Mr. DURBIN. I thank my colleague, the Senator from Massachusetts.
I think his point is well taken. I might add this. He has specified
various groups that have come forward with reservations about this
amendment. He and I both understand that in a time of economic turmoil,
economic recession, some of the most vulnerable Americans are not even
represented in Washington by a special interest group. They are the
working poor, getting up every morning, and going to work, 40 hours a
week, struggling to get by, barely beyond the minimum wage, often
husbands and wives, sometimes working two jobs, trying to make ends
meet, trying to keep their families together.
That is what concerns me. They will be the first casualties in a
recession. They will be the ones laid off. They will be the ones who
will have to then make a decision about their lives and to get back on
track. And what we are saying, I believe the Senator from Massachusetts
and I agree, is that at various points in the modern history of America
there have been opportunities

[[Page S1172]]

for them created through Government programs that have helped.
Oh, certainly they need their own personal responsibility, their own
initiative. But the door was there for them to walk through. If that
door is bolted shut with the supermajority requirement, these families,
the working poor, the groups that the Senator from Massachusetts has
outlined, they will be the first casualties. That is why I offered the
amendment. I thank the Senator from Massachusetts for speaking on
behalf of the amendment.
Mr. KENNEDY. I thank the Senator.
As he has pointed out, the economic issues and strength of our
country is really the backbone for all of the hopes and dreams of
working families. His amendment goes right to the core issue about what
this impact would be at a time of economic cycles. I think anyone that
understands the history of the economic strengths and weaknesses of our
country would see that we should learn lessons from the historic past.
Unfortunately, this amendment does not benefit from that kind of
historical perspective, the underlying amendment. The Senator's
amendment certainly does. I look forward to supporting the Senator's
amendment. I thank him for bringing this matter to the attention of the
Senate today.
Mr. DURBIN. I thank the Senator and reserve the balance of my time.
The PRESIDING OFFICER. The Senator from Utah has reserved the balance
of his time.
Mr. HATCH. I would like to recognize the distinguished Senator from
New Hampshire, but first let me take 1 minute.
I heard the dialog between the distinguished Senator from
Massachusetts and the distinguished Senator from Illinois, and I have
to say that I am fully familiar with all those groups. And about 78
percent of the American people--between 68 and 78 percent of the
American people--have always been for this balanced budget amendment.
They come from all walks of life, from every group. The reason they do
is they are deathly afraid that if we do not get this spending under
control, the very people that my good friends have been talking about
are going to be hurt the most. There is no question about it.
To just keep arguing that we can continue to do business as usual, as
has been argued here, that is the biggest joke of all.
I yield 15 minutes to the distinguished Senator from New Hampshire.
Mr. BOB SMITH. I thank my colleague from Utah for yielding and thank
him for his strong leadership on this issue which he has done for so
many years as we wait to see the long hoped for amendment finally reach
passage.
I was somewhat taken by the comments on the Durbin amendment made by
my colleague. This is again an effort obviously to weaken the
amendment. It is an interesting question about what an economic
recession would be. How would one define it? Would it be just a general
feeling of anxiety about the economy? Would that be an economic
recession?
I might also add, that in difficult economic times you will see areas
of the country where certain pockets of the country, certain areas of
the country there would be an economic downturn and other areas there
may be an economic upswing. So the areas of the country where there is
an economic downturn, how do we define where the amendment and when the
amendment would kick in?
It is obviously a weakening amendment. It is interesting, Mr.
President, that for years and years and years we have heard from the
critics, we do not need this amendment. We do not need a constitutional
amendment to balance the budget. All we have to do is balance it. We
have not done it yet. So I am waiting. And those people who say that we
ought to do that, without the amendment, keep offering amendments to
weaken what we are trying to do.
This is a very historic debate that we are in today. Not only is it
historic in the sense that there have been a number of efforts in the
past to have a balanced budget amendment, but it is historic in the
sense that if we fail, our children are going to pay the consequences.
I think they are going to judge us not in a very kind way if, in the
future, in the outyears, if they look back upon this time when we had a
chance to deal with this in the Constitution and did not do it.
I am pleased and proud to be on the side of Senator Hatch in this
debate. I think he is on the side of the American people. Frankly, not
only the American people today, but tomorrow and for many, many years
to come. We have had a number of efforts, starting in 1935 in the 74th
Congress. That was the first measure designed to require an annually
balanced budget, and introduced by a Democrat, Senator Tydings of
Maryland. The next year, the first proposed amendment to balance the
budget constitutionally was by Harold Knutson of Minnesota, a
Republican, in 1936. It was a bipartisan idea, and it began as early as
1935. Since then, we have had some 30 measures that in some form or
another have come before this Congress.
The balanced budget amendment is not a Republican proposal. It is a
bipartisan proposal. It always has been. Not only have all Senate
Republicans cosponsored the resolution, but many Democrats have, as
well--not as many as we would like, but many have. We hope we will get
the other two or three that we might need.
Senate Joint Resolution 1 was approved by the Judiciary Committee
with the support of three Democrats--Biden, Torricelli, and Kohl. In
addition, six other Democrats, Bryan, Graham, Baucus, Breaux, Moseley-
Braun, and Robb, as well as Senator Kohl. So we have bipartisan
support. This is not a partisan issue. Preserving the United States of
America for our children is not a partisan issue.
Former Senator Paul Simon remains a very active and vocal proponent
of the amendment and helped to lead the fight here on the floor 2 years
ago when it was up on the floor. Perhaps even more recently, the late
Senator Paul Tsongas, whom we all knew and respected, who recently
passed away, stated: ``What you have here is a sad case of pursuit of
self as opposed to pursuit of what is in the national interest. The
balanced budget amendment is simply a recognition of that human
behavior.'' Paul Tsongas was right.
Secretary of Education Richard Riley was the Governor of South
Carolina. He stated:
I have opposed the amendment in the past, thinking it was a
`political cop-out.' The deficit problem has gotten so bad,
that I have now decided to support it.
That is the issue here. It has gotten bad. We have not had the
political courage, collectively, to balance the budget. You can say all
you want, that we do not have to put it in the Constitution, but while
we say that, the debt keeps going up, and it is now $5 trillion. Where
do we stop, $50 trillion? When we get to $10 trillion, we will not be
able to service the debt because a $10 trillion debt will cost you $1
trillion in interest alone. The entire Federal budget is a little over
$1.5 trillion, so two-thirds of the budget will be interest if we
continue along this line. It needs bipartisan support, and I am glad
that it has it. I hope it has enough.
The last time the Federal Government had a balanced budget was 1969.
The total debt was $366 billion. Today, it is $5 trillion. In less than
10 or 12 years, it will be almost $10 trillion if we continue with the
current rate of spending.
Yet, we still have those who come to the floor and say we do not need
an amendment, we do not need to clutter the Constitution. The Founding
Fathers knew what they were doing; they did not put it in there; we do
not need it; we can balance the budget. When? Each year that the
Federal Government spends more than it takes in, billions are added to
the overwhelming weight of our national debt.
Even if we pass this, by the time we get things in order, we will add
hundreds of billions of dollars to the debt, Mr. President. In fiscal
year 1998, we will pay approximately $1 billion a day--$1 billion a
day--in interest on the debt. In the fiscal year 1997, the gross
interest we pay to the service of debt will total $360 billion, the
second largest expenditure in the entire budget. It is $100 billion
more than we spend on defense. Mr. President, $100 billion more than we
spend on defense we spend to service the debt in 1997.
What could we have done with all the money we have paid to service
that debt? Now, that is a very interesting topic. We get criticized a
lot here in the Senate for fantasizing. Let me fantasize about what we
could do with all that money.

[[Page S1173]]

I came to Congress in 1985. What if we had passed a balanced budget
amendment to the Constitution that year and achieved balance in 1990?
Imagine what we could have been doing with that money, which by now
would have accumulated to $1.7 trillion. We could have built 97 space
stations. We could have increased funding for the EPA 261 times.
Imagine the potential of crime control programs if the Department of
Justice just received 98 times more than this year's level. If we
balanced the budget in 1985 and continued the current rate of spending,
we could have done all of those things. If you did not like them, fund
something else.

What if Congress had balanced the budget in 1970 and kept it
balanced? That was the year after we started the deficit spending. What
if we actually had a $5 trillion surplus? We could preserve both
Medicare and the Social Security Program for our children. Veterans
benefits and services could be increased by 116 times. We could provide
tax refunds instead of tax increases. Instead of imposing fees to enter
our parks, we could increase funding for national parks by 4,000 times.
So when you hear the people come to the floor and say it does not
matter, we do not need to clutter the Constitution, that is not
cluttering the Constitution. That is a well-needed amendment. Had we
done this in 1970--true, we would not need the amendment. That is why
we have the amendment process, Mr. President. The U.S. Constitution
should be amended only in the gravest of times, only when it is
necessary. How much graver can you get than the kind of debt we are
passing on to our children? How much graver can you get than a $10 to
$15 to $20 trillion debt? That is where we are headed.
It has been changed 27 times, this Constitution. It affects every
single Government activity and all Federal spending and touches the
life of every man, woman, and child in our Nation, this issue of debt.
A constitutional requirement makes it impossible for Congress to shirk
its duty to make responsible fiscal decisions. That is what this debate
is about: discipline by a constitutional requirement. No copout. You
cannot have Senators coming on the floor, giving all these excuses,
because it is in the Constitution. So they will have to do it. We may
disagree on what we want to cut or what we have to do to balance that
budget. We may disagree on that, and we will have that debate, vote,
and take our lumps one way or the other, but we have to do it. We have
to do it. That is what we have to do now. Congress will have to come up
with cures for the Nation's financial woes, not just Band-Aids, and not
just words.
In a very few years, Mr. President--I am sure Senator Hatch and
others have said this on the floor--in a very few years, interest rates
on the debt plus entitlements will equal 100 percent of the Federal
budget. That is the good news. The bad news is it is continuing to
expand, that interest is consuming more and more and more of that pie,
including the entitlement pie, because, theoretically, if we do not
stop it, it will consume everything. If you think of your homes, your
businesses, you can only go to the bank so many times and then they put
the stop on, the cap on the credit card, the cap on your credit, and
say, ``Now you have to live within your means,'' that is what this
amendment will force this Congress to do.
Despite compelling evidence of the need for immediate deficit
control, legislative budget controls have failed to produce a budget
surplus since 1969. We tried it with Gramm-Rudman. It sounded good.
What happened? When we went to the sequester, when the rubber hit the
road and we had to make the decision, we changed the law. We copped
out. You cannot change this law. If we pass it into the Constitution,
it is constitutional, you have to do it.
Deficit spending is no mystery, although some would prefer it remain
so. In fact, on Thursday, the Senator from North Dakota displayed a
chart titled, ``We Cut the Deficit in Half.'' While it is true that the
deficit projections are decidedly better than the May 1996 estimates,
what actually accounts for the rosier outlook? The welfare reform
legislation we passed last year had the greatest budgetary impact of
any piece of legislation passed by the 104th Congress, according to
CBO. This was the bill which President Clinton had to be dragged
kicking and screaming to sign. And he apologized for signing it, but he
signed it. That is the important thing. In addition, in his recent
budget request, the President now proposes to add $22 billion in new
spending to that welfare bill. Yet, he wants us to trust legislative
remedies. Legislative remedies don't work, folks, because of human
nature--the temptation to spend.

With a balanced budget constitutional amendment, we don't have to
worry about the whims and indulgences of a President, or Congresses, in
years to come. Congress would have to stick to a strict budget just
like American families and businesses. We need to pass this amendment.
We need to pass it now. We should have passed it years ago. We could
have passed it 2 years ago. We lost by one vote. All we are doing, my
colleagues, is giving the American people a chance to have this go to
their State legislatures so that they, then, can act to either approve
or disapprove what we do. We are giving them the opportunity.
Over the last 60 years, total Federal expenditures have increased by
more than 800 percent. By 2020, if we do not raise taxes, we can zero
out all Federal spending, except interest on the debt, and still not
balance the budget. That is why we need it now.
Now, it's interesting that when we think about balancing the budget,
we think about it in terms that are perhaps away from home--this big
issue balancing the Federal budget, don't spend this or that. Let me
give an example. In New Hampshire, my State, the average citizen pays
as much as $38,000 more on a 30-year mortgage for an $80,000 home as a
result of the budget being out of balance. A student in New Jersey pays
almost $9,000 more toward a 10-year loan. In just 1 year, a car owner
in South Dakota could save $180 on an average auto loan, if we balance
the budget and keep it balanced. The Concord Coalition estimates that
the average family's income is $15,000-plus a year lower because of the
deficits of the past 20 years. It impacts everyone--whether you work or
don't, whether you have children or whether you don't. We can improve
wages. We can create jobs. A 2-point cut in interest rates would not
only reduce loan payments for families, but it would produce more jobs,
perhaps 4\1/2\ million more in 10 years. For businesses, a 2-point
percentage reduction in rates would lower investment costs and enhance
the incentive to invest.
I don't want to have to explain to my children someday, as we look
back on this debate, why I stood here and mortgaged away their future.
I am standing on this floor today, proudly in the sense that I support
this amendment, but in a way ashamed that we have to. A baby born today
can expect that over $187,000 of his or her lifetime income will be
used just to pay interest on the debt--$187,000.
Paul Tsongas, our former colleague, described Congress' deficit
spending as ``generationally immoral.'' He was right. He was right a
lot. I wish some of the colleagues on the other side of the aisle would
have listened to their former colleague. We must look for a real long-
term solution to address the retirement of the baby boom generation and
the explosion of entitlement programs that will accompany this shift.
We must not push off these disasters and leave them to my children and
your children to solve. In simple terms, when we all shuffle off this
planet at some time--hopefully, later rather than sooner--you would
probably like to leave your assets to your children. Do you sit up at
night and dream about leaving them your debts, your mortgage, your car
payments? Or would you like to leave whatever you were able to build up
as assets?
The PRESIDING OFFICER. The time of the Senator has expired.
Mr. BOB SMITH. May I have 2 more minutes?
Mr. HATCH. I yield 2 more minutes to the Senator from New Hampshire.
Mr. BOB SMITH. I thank my colleague. The conclusion is that there is
a light at the end of this tunnel. You know what stands in the way of
that light, Mr. President? About three votes--three votes. Maybe two.
Senator Hatch is counting the votes. I haven't been counting them all.
But it's two or three votes, two or three U.S. Senators

[[Page S1174]]

who are probably on the fence. That is the difference. That is how
close it is. We lost it by one vote 2 years ago.

Votes do matter. That is the difference between trillions in more
debt and mortgaging our future or not. Senator Rudman, my New Hampshire
colleague, said to me one time, ``There are only two things that can
happen if we don't stop this insane process. First, we can continue to
deficit spend and just cause sheer chaos when we can't pay our bills
and go bankrupt. Or, second, we can print more money and sit around
with 200, 300 percent inflation.'' We should all think about what that
would do to our daily lives.
There is no other option if we don't balance the budget. It is
insane. Every American--man, woman, and child--in this country knows it
is insane. They know it. You know you would not put up with it with
your school board, your business, or your local government, town
government; but you let the Federal Government, the Congress men and
women spend you into oblivion. There is a light at the end of the
tunnel, and I hope that the U.S. Senate and the Senators won't block
that light. I hope this month the Senate will show the American people
that they are interested in the future of our country and our children.
Thank you very much.
Mr. DURBIN. Mr. President, I thank the Senator for his contribution
to this debate. I agree with him that there are many leaders in both
political parties who come to this issue with complete sincerity. He
has noted my predecessor, Senator Paul Simon of Illinois, the late Paul
Tsongas of Massachusetts, Warren Rudman, and the list goes on--men and
women who have taken the time to analyze this situation and have come
to the conclusion that a balanced budget amendment is in the best
interest of this Nation.
I respect all of those people, but I respectfully disagree with them
when it comes to the specific language of this amendment. There is a
reason why the Secretary of the Treasury, Mr. Rubin, after 26 years on
Wall Street, came before our Judiciary Committee and testified that
absent an amendment, such as the one I am offering today, this
procedure that we are enshrining in the Constitution will tie our hands
in times of economic emergency and recession. It will turn recessions
into deeper recessions or even depressions. We can't justify that, in
the name of clinging to the old school language of the balanced budget
amendment. The Senator from New Hampshire says we may be within one or
two votes.
I say to the Senator from New Hampshire, if we can sit down in a
calm, bipartisan way and address two aspects of this balanced budget
amendment, the supermajority gridlock when it comes to a national
disaster or national economic emergency, and protection of the Social
Security trust fund, I would daresay to my friend from New Hampshire
that we would not be quibbling over two votes. This amendment would
leave the floor of the Senate and the House with the kind of
substantial bipartisan majority which would say to the legislatures
across America that this amendment is a better one, a better version.
But you know what happens in this town, in ``Wonderland, DC.'' Special
interest groups get dug in. You can't change a word. If you touch a
word of it, you are betraying all of the trust that has been given you.
Please, how seldom we rise to amend this Constitution. Should we not do
it in a way that is responsible, in a way that meets the requirements
of our future?
You know, during the worst days of our budget deficits, during the
Reagan and Bush administrations, there were many Members of the House--
most are not serving now--that I served with, who used the balanced
budget amendment as a figleaf for their fiscal recklessness. They would
rush down and vote for these unbalanced budgets. They would lard up
their districts. They would vote for big spending here and there. And
then, when people said, ``Well, how do you explain doing this when it
produces such deficits?'' ``I am for a balanced budget amendment, I
want to amend the Constitution, and I want to make it against the law
for people to do what I am doing. That shows you how sincere I am.''

Now we are like generals fighting the last war. That mentality, that
language, brought to 1997 is what we want to put in and enshrine in
this Constitution, saying that the wording and terms are inviolate,
ignoring the realities. And, yet, the Treasury Secretary and over 1,000
recognized experts on the economy have come forward and warned us. They
have warned us to think twice about this. It may have a surface
political appeal. But how on God's green Earth is it going to work?
The chairman spoke eloquently in the debate on Thursday regarding my
amendment and said, ``The very purpose of this provision of the
distinguished Senator from Illinois is to make a balanced budget
amendment easier to waive.'' He went on to say, ``Instead of trying to
find ways to avoid fiscal responsibility, we ought to be working toward
passing a strong balanced budget amendment that will help us to keep
out of recessions in the first place.''
I would like to say to the distinguished chairman of the Senate
Judiciary Committee that if he can help us craft an amendment that will
abolish recessions in the American economy, I will certainly consider
it carefully. But I do not think we gain anything by suggesting that a
balanced budget amendment will put an end to the business cycle. With
or without this amendment we will someday face a recession, and the
question is, How will we respond?
For those who question whether or not this Senator from Illinois will
vote for a balanced budget amendment, I have voted for five balanced
budget amendments--five versions that protected Social Security,
avoided the supermajority gridlock, and addressed important issues that
protect the American people particularly in times of recession.
I would also like to make note of another element. Some say that this
will lead to irresponsible behavior by the Senate and the House; that,
if the Durbin amendment is adopted requiring only a majority vote, the
people will exploit this amendment. I do not think the critics have
taken a close look. If the critics of this amendment will read it
carefully, they will see that, in my amendment, anxiety is not the
basis for waiving the balanced budget. They will see that it requires,
in fact, specific action by the House and by the Senate for waiving.
First, there must be an economic recession, or a serious economic
emergency in the United States.
Second, Congress, must declare that there is such a recession, or
serious economic emergency, by joint resolution.
Third, that resolution must be adopted by a majority of the whole
number of each House.
Fourth, that resolution must become law, which means it must be
signed by the President, or enacted over his veto by two-thirds vote of
both Houses.
I do not believe that any future Congress will view this as an escape
hatch to ignore the requirements of a balanced budget. If they do, it
will be at their own political peril.
I believe that the requirement which I have in my amendment to the
balanced budget amendment will require public accountability, a record
vote, and the determination by the House and the Senate that, in fact,
we do face an economic emergency.
The chairman has also said we do not need the Durbin amendment; that
what we need to do is to run a surplus in our Treasury so we have a so-
called rainy day fund that we can turn to to take care of working
families who have lost their jobs. Unfortunately, the lead witness
called by the chairman of the Judiciary Committee to testify on behalf
of the balanced budget amendment, former OMB Director James Miller, who
is living proof of the redemption of politics, a man who has presided
over a series of deficits as OMB Director and now is totally committed
to a balanced budget since he no longer holds that position, came
before us and said that, if he could change one thing in this balanced
budget amendment, he would allow the Federal Government to establish a
rainy day fund, or a stabilization fund.

Mr. Miller knows, I know, and I think most do, the language being
offered by the chairman in Senate Joint Resolution 1 does not allow the
creation of a surplus, or this rainy day fund, to be there when our
economy is in need. That, I think, is a serious shortcoming.
Chairman Greenspan of the Federal Reserve Board, a man credited by
both

[[Page S1175]]

political parties despite controversy of having used monetary policy to
stabilize our economy, was testifying before the Budget Committee when
I asked him point blank, ``Are you for a balanced budget amendment to
the Constitution?'' He said that we should not put ``detailed economic
policy'' into the Constitution. I asked him about the automatic
stabilizers, the Government coming to the rescue of an economy because
of a recession. He said, ``It is far better to have a surplus or rainy
day fund.''
I am sorry to tell Chairman Greenspan that the balanced budget
amendment before us today does not give us that option. It does not
give us that option and, because it does not give us that option, is
fatally flawed.
Let me speak to the supermajority vote again. Not only would a
supermajority vote result in too many of our predecessors failing to
ratify our Constitution but a supermajority vote--think about this for
a moment. Think about it in the context of the last 24 months, the last
24 months when this Government was in such chaos and gridlock that we
had Government shutdowns. Because of the requirement of a supermajority
vote? No. Because of the requirement of a majority vote to extend the
debt limit of the United States. Facing the need to pass a debt limit
bill simply acknowledging our obligation for debt already incurred, or
about to be incurred, we could not do it by majority vote. Without that
debt limit extension, Federal law required that the functions of
Government stop. The Government was shut down not once but twice for a
total of 27 days at the cost to taxpayers of over $1.4 billion for the
failure of Congress to muster a majority vote.
Now we hear from the proponents of this amendment, ``Trust me. If we
get into trouble, if there is a regional economic recession, if there
is a disaster, a Midwest flood, or hurricane in Florida, surely this
Congress will come together and do the responsible thing.'' Well, we
saw, unfortunately, in recent memory when the Congress did not rise to
its responsibility, or rise to the occasion, and allowed these terrible
Government shutdowns for lack of a majority vote. And now we are
putting in the Constitution of the United States clear language to
require a supermajority to respond to a national economic emergency.
The Senator from Idaho, Mr. Craig, said on Friday that past
Congresses have passed economic stimulus packages in times of recession
when they were needed with the necessary 60 votes, including 1993.
Unfortunately, his recollection was not accurate. The inability to
obtain 60 votes prevented enactment of antirecession legislation in
1993, and even the President's deficit reduction package, which turned
out to be a tremendous boost to the economy, passed this body only when
the Vice President voted with an ``aye'' vote. By supermajority it
never would have occurred, and I am not certain where we would stand
today in terms of our economic situation.
I reserve the remainder of my time.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. Mr. President, what we need to do for families is to
resist the higher interest costs on the mortgages, student loans,
consumer purchases, auto loans, et cetera. If Congress can get its
fiscal house in order, more jobs will be created and those jobs will be
more secure. If Congress stops borrowing so much, we will have a more
stable economy, which, of course, can help us to avoid these economic
downturns in the first place. The only way we are going to get there is
to quit piling the 29th unbalanced budget and the 30th and the 31st on
top of each other.
The fact of the matter is the balanced budget amendment is flexible
enough to respond to most needs--in fact, all needs. Put it that way.
But it is serious enough to stop Congress from continuing the pattern
of borrowing year after year which has kept the economy from growing as
well as it could have.
My colleague from Illinois has introduced an amendment that seeks to
waive the provisions of Senate Joint Resolution 1 for any fiscal year
in which there is an economic recession or serious economic emergency.
As such, the Durbin amendment seeks to avoid the three-fifths vote
required by Senate Joint Resolution 1 to waive the balanced budget
rule. This three-fifths majority was placed in the balanced budget
amendment so that a simple majority of the Congress could not run
deficits except in important situations--those recognized by a
supermajority of the Members. Efforts such as the Durbin amendment
would blow a huge hole in the balanced budget amendment.
The terms used in the Durbin amendment is undefined. The
determination of an economic recession or serious economic emergency
could easily be manipulated by a spendthrift Congress as a way to avoid
the discipline of the balanced budget amendment. Thus, the amendment
would create a giant loophole that would swallow the balanced budget
rule.
Remember, also, that if the balanced budget amendment is waived for a
recession, it is waived for all spending in that year. In other words,
this amendment would permit deficit spending for any number of wasteful
projects that are in no way related to the so-called economic
emergency. Just remember President Clinton's 1993 attempt to push
through a multi-billion dollar boondoggle under the guise of trying to
end a recession which had in fact already ended. In short, Mr.
President, if you take your finger out of the hole in the dike, the
whole town is going to be flooded.
One of the arguments made in favor of this amendment is that without
it, the balanced budget amendment will somehow inhibit the functioning
of the so-called automatic stabilizers. Mr. President, I believe the
importance of automatic stabilizers has been overstated and, in any
case, the balanced budget amendment will not inhibit their functioning.
Moreover, the Durbin amendment does not respond to the concerns raised
about the automatic stabilizers. It simply allows Congress to avoid the
balanced budget rule by a lower threshold.
Just to be clear on what these stabilizers are supposed to do, the
notion of automatic stabilizers has to do primarily with the belief
that in an economic downturn, there is a decrease in tax revenues and a
concomitant increase in unemployment compensation and other welfare
payments.
The claim that the automatic stabilizers have moderated the business
cycle is based on the assumption that the relative increases in
Government spending associated with automatic stabilizers causes
automatic, effective counter-cyclical fiscal policy. It is argued that
such increased spending is the key to moderating both the depth and
length of recessions and that the balanced budget amendment will
prevent that spending from occurring.
I believe the characterization of the effectiveness of the automatic
stabilizers has been overstated.
When appearing before the Senate Budget Committee just last month,
CBO Director June O'Neill was asked a question about the relationship
between automatic stabilizers and the apparent moderation in the
business cycle over the last half-century. She cited better monetary
policy and the Nation's move from away an agricultural based economy,
with the inherent ups and downs that go along with agriculture, as
factors at least as important as automatic stabilizers in minimizing
recessions. Additionally, the move to a service economy and better
inventory management practices have reduced the fluctuations associated
with inventory overstocks and the factory economy.
Further, a financial markets expert pointed out to the Judiciary
Committee that the primary reasons why the business cycle has moderated
in recent years are, first, monetary policy, which is controlled by the
Federal Reserve Board; and second, the increasing efficiency of private
markets, because of better information and other factors. These have
nothing to do with automatic stabilizers or fiscal policy.
It is relatively well-recognized that the perceived moderation of the
business cycle over recent decades is due to many factors. For example,
a December 2, 1996 article in the Washington Post affirmed, ``The
success in finally halting the U.S. economic roller-coaster has been
the result of many elements * * *''
The Post article cited ``new technologies, the deregulation of many
industries, and the increased

[[Page S1176]]

globalization of business and finance,'' as some of the most important
changes that helped stabilize our economy. Global trade enables us to
export what would otherwise be oversupply thus avoiding a bust cycle.
Further, that article quoted Herb Stein, a former chairman of the
Council of Economic Advisors, who noted that ``[b]ecause the economy is
so big and so diversified and so open to the world economy, a shock
would have less impact now.'' Thus, an event that may have sent the
country into a recession in 1890 would only be a localized disturbance
today.
Another major factor in helping to tranquilize recessions that the
Post recognized is that we are no longer on the gold standard. ``After
the United States was no longer obligated to defend the price of gold,
and the nation's deficits in international transactions could be
financed easily by that world capital market, the Fed had far more
ability to set interest rates according to the needs of the domestic
economy.''
So while these automatic stabilizers may have had some effect, there
are clearly many other major factors that have brought our economy to
the level of consistency we enjoy today.
Certainly the automatic stabilizers are no justification for
balancing the budget only eight times in the last 65 years. Let's face
it. Our deficits have not been countercyclical, they have been
counterproductive. While business cycles have come and gone over the
last four decades, our deficit habit has not. Our deficits are
structural and largely permanent, not cyclical.
I also want to note that the notion of a country spending itself out
of a recession is now rejected by many economists. One commentator has
wryly stated that the theory of spending and borrowing out of a
recession ``is the game-plan that propelled Argentina and Bolivia to
economic superpower status in the 1970's.'' More recently, Japan has
tried to do this and the result has been continued recession and larger
debt. On the other hand, a number of the world's up-and-coming
countries are enjoying booming economies while keeping their national
budget in balance or even surplus. Perhaps we should be more concerned
that we do not spend ourselves out of prosperity.
But even if we assume that automatic stabilizers are important, Mr.
President, the balanced budget amendment will not impede their use.
The balanced budget amendment in no way prevents us from running a
small surplus, which could be used to offset the effects of an economic
downturn, thus avoiding a deficit. In fact, a number of experts the
Judiciary Committee has heard over the years have suggested we do so.
Fred Bergsten, a noted economist and former Treasury Department
official, suggests we create a habit of regularly shooting for a small
surplus, rather than absolute balance, which will allow us to use
fiscal policy within the balanced budget rule better than we can now
without it, with chronic, structural deficits.
Even if we drop below an intended annual rainy day surplus, the
balanced budget amendment has anticipated this sort of need. A three-
fifths vote in Congress will allow the balanced budget rule to be
suspended for a year. That way, we have the flexibility to run
reasonable deficits if we need to. The three-fifths requirement makes
sure that we do not waive the amendment unless it is a true need and
not just an attempt to avoid the tough choices.
Some have suggested that the necessary three-fifths will be hard to
come by. The history of the votes in Congress demonstrate that in
actual circumstances of economic need, the Congress has had little
difficulty achieving the vote that would be required under the balanced
budget amendment, despite the fact that no such requirement was in
place.
The Congress has voted a number of times to extend the emergency
unemployment compensation program. During the past 15 years, according
to the Congressional Research Service, there is only one instance where
the extension of this important program failed to garner a
supermajority of votes in either Chamber. Indeed, in many cases even
higher supermajority requirements would have been fulfilled. In times
of real need, Congress will get a three-fifths vote.
Some have also argued that the Durbin amendment is needed because
Congress is too slow to respond to recessions. Well, they are half
right. Congress is too slow to respond to recessions. Almost everyone
agrees that when Congress tries to spend the country out of an economic
downturn, their attempt either has little effect or they make things
worse by spending as the economy is already recovering and then sowing
the seeds of a future recession.
But the Durbin amendment does nothing to address this concern. It
does not speed up congressional action--I'm not sure anything can. All
it does is change the vote required from three-fifths to a majority.
And since history clearly shows that we get the three-fifths when we
need it, all this amendment would do is make it easier to waive the
balanced budget rule when we don't really need it.
Finally, Mr. President, when he introduced his amendment the Senator
from Illinois told a story about a friend who needed temporary help
from the Government in his transition from one job to another. There is
no doubt that this is a meaningful and laudable use of our precious
resources.
But it seems to me that we do all the working people of America a lot
more good if we balance the budget, and thus reduce the number of
recessions that they must endure, than if we create a loophole in the
balanced budget amendment to allow future Congresses to easily increase
the already crushing burden of debt. We ought to be less concerned
about when we can spend more, and more concerned about when we must
spend less.
Senator Durbin's amendment seeks to waive the provisions of Senate
Joint Resolution 1 for any fiscal year in which there is an economic
recession or serious economic emergency in the United States as
declared by joint resolution. As such, the Durbin amendment seeks to
avoid the three-fifths vote majority prescribed by Senate Joint
Resolution 1 in avoiding the requirement that receipts match outlays
for any given fiscal year. This three-fifths majority was placed in the
balanced budget amendment so that a simple majority of the Congress
could not run deficits except in important situations--those recognized
by a supermajority of the members. Efforts such as the Durbin amendment
will render Senate Joint Resolution 1 useless.
The Durbin amendment is wholly unnecessary. A brief analysis of
historical fact will demonstrate that in circumstances of national
disaster or economic downturn, the Congress has had little difficulty
passing remedial legislation with supermajority support.
The history of votes in this body demonstrates that in actual
circumstances of economic assistance for unemployment or disaster
relief, the Congress has had little difficulty achieving the
supermajority vote that would be required under the balanced budget
amendment. The Congressional Research Service helped me do some
research on voting patterns in this area. I want to present for you the
results of my research because I think it is illustrative.
Let me summarize the results briefly: On the question of responding
to economic recessions, the Congress has voted a number of times to
extend the emergency unemployment compensation program. During the past
15 years, I count only one instance where the extension of this
important program failed to garner a supermajority of votes in either
Chamber, based on Congressional Research Service data.
Similarly, in the area of disaster relief, over the past 7 years, I
found that in virtually every circumstance, emergency spending bills
placed before the House and Senate passed with supermajorities, on the
order required by the balanced budget amendment, even though no such
requirement was in place.
Let me go into more detail on the unemployment compensation votes.
H.R. 3167, which became Public Law 103-152, extended the emergency
unemployment compensation program [EUCP] in November 1993. This
conference report passed the House with a vote of 320 to 105 and passed
the Senate, 79 to 20. The underlying bill achieved similar majorities,
passing the House 320 to 105, and the Senate 79 to 20. In March 1993,
another emergency unemployment compensation bill passed the Congress
and became Public Law 103-6. The

[[Page S1177]]

supermajority on H.R. 920 in the Senate was 66 to 33, and the vote in
the House was 254 to 161.
In 1992, the House passed the conference report on H.R. 5260, to
extend the EUCP, by a vote of 396 to 23. The Senate acted similarly,
passing the bill, which became Public Law 102-318, by a vote of 93 to
3. Also in 1992, the Senate passed H.R. 4095 to extend the EUCP by a
vote of 94 to 2. The House passed the same bill, which became Public
Law 102-244, by a vote of 404 to 8.
In 1991, the House passed S. 1722, to provide emergency unemployment
compensation, by a vote of 294 to 127. The Senate passed the same bill,
which was vetoed by the President, by a vote of 69 to 30. Similarly,
the House passed the conference report on this bill by a vote of 300 to
118 and the Senate passed the measure 65 to 35. Earlier in 1991, the
House passed H.R. 3201, to provide emergency unemployment compensation,
by a vote of 375 to 45. This measure became Public Law 102-107. The
Senater passed it by voice vote. Finally, H.R. 1281 was passed in March
1991, providing funding for the Unemployment Compensation
Administration [UCA]. This bill passed the House with a vote of 365 to
43. It passed the Senate by a vote of 92 to 8. The conference report on
this bill, Public Law 102-27, passed with tallies of 340 to 48 and 93
to 3, respectively. In 1990, the House passed H.R. 4404, to provide
funding for the UCA, by a vote of 362 to 59. The conference report
passed 308 to 108. This bill became Public Law 101-302, after passing
the Senate by voice vote.
All the way back in 1983, the Senate passed H.R. 1718, to provide
funds for the Unemployment Trust Fund. The bill, Public Law 98-8,
passed the Senate 82 to 15. Finally, the Senate voted in February 1982
to pass House Joint Resolution 391, to provide funding for the
Employment and Training Administration, by a vote of 95 to 0.
What do these vote tallies indicate? They demonstrate that the Durbin
amendment is completely unnecessary. During the past 15 years, my
research reveals only one instance where a vote to provide unemployment
compensation during a period of economic recession did not pass by a
supermajority. One time in 15 years. That's remarkable.
Similarly, in the area of disaster relief, Congress has
overwhelmingly acted by supermajority votes in responding to crises.
In fiscal year 1995, the House and Senate voted on H.R. 1944, which
provided $7.2 billion disaster aid, mostly to help with recovery
efforts in Los Angeles from the 1994 earthquake. The bill passed the
Senate with a vote of 90 to 7--a clear supermajority. In the House, the
bill passed with 276 votes--also a supermajority.
The 1994 fiscal year Disaster Supplemental Appropriations bill, H.R.
3759, received similar treatment. That bill, to provide nearly $10
billion in new appropriation for the emergency expenses of the Los
Angeles earthquake, humanitarian assistance and peacekeeping
activities, as well as for Midwest flood assistance and highway
reconstruction from the San Francisco earthquake, passed the House by a
vote of 337 to 74--not really close, was it, to the 261 required for
the three-fifths vote. The same measure passed the Senate by a vote of
85 to 10.
The 1993 fiscal year disaster supplemental appropriations bill, H.R.
2667, providing nearly $3 billion for emergency relief from the
widespread flooding in the Midwest and other natural disasters, passed
the House by a vote of 400 to 27. The Senate adopted it by voice vote.
In 1992, the disaster relief supplemental appropriations bill, H.R.
5132, passed the Senate by a supermajority vote of 61 to 36. The bill
provided $2 billion in new budget authority for fiscal year 1992,
including funds for disaster assistance and loans to respond to the Los
Angeles riots and the Chicago tunnel collapse and subsequent flooding.
In the House, the same bill passed by a vote of 244 to 162.
Also in 1992, the defense and disaster supplemental appropriations
bill, H.R. 5620, providing $10 billion in grants and loans to help
victims of Hurricane Andrew, Typhoon Omar and Hurricane Iniki, passed
the Senate by a vote of 84 to 10, it passed the House by a vote of 297
to 124. Finally, the 1992 supplemental appropriations bill passed the
Senate with a vote of 75 to 17. This bill provided $8 billion for
Operations Desert Shield and Desert Storm as well as other moneys for
communities recovering from other natural disasters. The same bill
passed the House by a vote of 252 to 162. The conference report passed
the House by a vote of 303 to 114.
Last, the 1990 continuing appropriations bill, House Joint Resolution
423, provided disaster assistance generally. This bill passed the House
by a vote of 321 to 99, and passed the Senate by a vote of 97 to 1.
During the past 7 years, we have voted many times on emergency
disaster funding programs. I count only two situations where a
supermajority was not reached--this despite the fact that no
supermajority was needed.
The facts are hard to refute. The Durbin amendment clearly has little
or no factual basis when compared to the voting record of the Congress.
When the situation warrants, either because of economic recession or
natural disaster, this body has had little difficulty achieving a
supermajority of votes to pass needed spending programs. The balanced
budget amendment has the flexibility necessary to respond to true
emergencies. Creating loopholes like the Durbin amendment only serve to
make deficit-spending as a matter of course easier.
I reserve the remainder of my time and yield the floor.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, I think the chairman, the Senator from
Utah, concluded that automatic stabilizers do have some impact. I think
that the chairman would agree with me that for a person who has lost
his job or a person who has lost her job, the prospect of turning to
the Government for unemployment insurance to continue to keep your
family together not only stabilizes your situation while you search for
another job but helps to stabilize the economy.
I think the Senator from Utah would agree with me that unemployed
workers seeking retraining and additional education to find a job in
fact help to stabilize our economy. And that is exactly the point of
this debate.
I would concede every point made by the chairman about all of the
other stabilizers that have evolved in our economy if he would concede
that there is still a legitimate role of specific programs which step
in to help the unemployed family.
Let me give you an illustration of this which has been used in this
debate before. This is an illustration of the business cycle in America
from 1870 forward. The spikes on the top of the line are the good news.
That is when the economy was expanding, businesses were growing,
farmers were doing well, and jobs were being created.
But every time we dip below this line, we see unemployment,
businesses going out of business, farmers quitting, heading to town.
And look at these spikes in the economy on the negative side leading up
until about 1945 or 1947--much more pronounced, much more dramatic,
deeper recessions, depressions, millions of Americans put out of work.
But what happened after the mid-1940's? We see the downturns, but
they are barely noticeable in comparison to what occurred before that
time.
Automatic stabilizers. The things which the Senator from Utah noted--
global economy, monetary policy, so many other things--but what happens
are the things I have noted as well. Families out of work had a place
to turn. It was no longer survival of the fittest. If you had personal
responsibility, if you were held accountable, you had a means to get
back on your feet.
Last Thursday, in this debate I talked about my friend, Bob Bergen,
who lost his job at the factory in Springfield. Bob came by my house
yesterday in Springfield, and we were talking about it. I said, ``Bob,
remind me. How did you get out of that factory job?'' which he had been
at for 22 years. They closed down the factory, and he got into the
business of furnaces and air-conditioning. I said, ``What was the name
of the program?''
``The JTPA Program. I signed up for it, and I went to the community
college. I took the courses, and when they closed that plant, I was
ready to do something with my life.''
JTPA is a Federal Government program. It is one of the automatic
stabilizers we have used in the past. To

[[Page S1178]]

discount that or dismiss it and say that it has nothing to do with Bob
Bergen now in a good business in Springfield, IL, employing his son, I
might add, as are so many millions of others, is to ignore reality.
Let me address one other point raised by the chairman.
The chairman says that my use of the term ``economic recession'' is
just not precise enough. I call the attention of the chairman to Senate
Joint Resolution 1, to his own language, which allows, in section 5,
Congress to waive all the provisions of the balanced budget amendment
in times that ``the United States is engaged in military conflict which
causes an imminent and serious military threat to national security.''
What does it mean? Troops in the field, troops under fire, whether or
not we suspect that might occur or it already has? These sorts of
things suggest that whatever the language of this constitutional
amendment, our implementing legislation is going to have to be there to
make certain that it is explained in detail.
At this time I yield to the ranking Democrat, Senator Leahy.
Mr. LEAHY. Mr. President, how much time do I have remaining?
The PRESIDING OFFICER. The Senator from Vermont has 7\1/2\ minutes.
Mr. LEAHY. Mr. President, I yield myself 3\1/2\ minutes.
I do support the Durbin amendment. I stated earlier that I wish it
would not be tabled, that we would have a straight up-or-down vote, but
I think the American public understands what the vote means.
I was interested in hearing my friend, the chairman of the Judiciary
Committee, the senior Senator from Utah, oppose the Durbin amendment
last week by saying the proposed constitutional amendment does not need
the flexibility of the Durbin amendment in times of economic crisis
because we can build up yearly surpluses to handle tough times. The
distinguished chairman said:

The balanced budget amendment in no way prevents us from
running a reasonable surplus which could be used to offset
the effects of an economic downturn. This surplus would allow
us to use fiscal policy within the balanced budget rule
better than we can now without it.

Not quite so. The constitutional amendment does not have that
flexibility. It is very specific as it is written, and it prohibits
this use of a rainy day fund. Indeed, those who support it--proponents'
own witnesses before the Judiciary Committee over the course of the
last two Congresses--pointed this out and suggested the language be
amended to provide for such a rainy day fund. The distinguished Senator
from Illinois was present at those hearings this year when they were
saying just that.
Fred Bergsten in 1995 and James Miller in 1997, the witnesses brought
by the proponents of the constitutional amendment, criticized the
language before us for not including the possibility of accumulating
surpluses in a rainy day fund. That is what we do to prepare for
economic downturns in my own State of Vermont.
So I hope we might pay attention to the Durbin amendment. I hope we
might support it.
The distinguished senior Senator from West Virginia, Senator Byrd,
challenged the other side to explain the language in this proposed
constitutional amendment to say how it is going to work; what do the
words mean; what sections do what? In fact, nobody has taken up the
Byrd challenge. I urge the proponents to accept the challenge of
Senator Byrd, if they can--I suspect they cannot--and say just what the
words mean.
If you read the words, they say, ``Total outlays for any fiscal year
shall not exceed total receipts for that fiscal year.'' Then they
provide for waiver by a three-fifths majority --come on, that is not
going to happen. The rainy day fund is out. It would require outlays,
specifically, those saved in the rainy day fund, to be expended in a
latter year and thereby exceed the total receipts for that fiscal year.
I ask unanimous consent that a copy of a letter opposing the so-
called balanced budget amendment for the Coalition for Budget Integrity
be printed in the Record. This is a coalition of approximately 150
organizations that oppose amending the U.S. Constitution to add a 28th
amendment on budgeting. The organizations range from labor unions and
children's advocacy groups, to seniors' groups, teachers, religious and
secular charities, environmental groups, nutrition groups, and
veterans.
There being no objection, the letter was ordered to be printed in the
Record, as follows:

Coalition for Budget Integrity,

Washington, DC, February 4, 1997.

Oppose the Balanced Budget Amendment

We, the undersigned organizations, strongly urge you to
oppose a balanced budget amendment to the United States
Constitution.
The proposed constitutional amendment is not the answer to
the nation's economic problems. The proposed balanced budget
amendment is likely to damage the economy more than
strengthen it. The amendment would require larger spending
cuts or tax increases in years of slow growth than in years
of rapid growth, precisely the opposite of what is needed to
stabilize the economy and avert recessions. The amendment
thus risks making economic recessions more frequent and
deeper.
A constitutional amendment would also be likely to limit
public investments which are critical to long-term economic
growth because the amendment fails to distinguish public
investments needed for growth from other areas of government
spending. The amendment would largely deny the federal
government a basic practice that most businesses, families,
and state and local governments use--borrowing to finance
investments with long-term payoffs.
This amendment has no place in the Constitution of the
United States. It would inappropriately draw the judicial
branch of government into the determination of fiscal and
economic policy. The amendment also undermines the important
constitutional principle of majority rule by establishing a
three-fifths vote to allow a budget to go unbalanced.
The American public has a right to know how a balanced
budget will be achieved before a balanced budget amendment is
enacted. Which important programs--education, health care,
social security, transportation, job training, environmental
protection, housing--will either be dramatically cut or
eliminated threatening America's vital interests?
We strongly urge you to oppose the constitutional balanced
budget amendment.
Sincerely,
AFSCME.
ACORN.
Advocates for Youth.
AIDS Action Council.
Alliance to End Childhood Lead Poisoning.
Amalgamated Transit Union.
American Arts Alliance.
American Association of Children's Residential Centers.
American Association of Classified School Employees.
American Association of Retired Persons.
American Association of University Professors.
American Federation of Government Employees.
American Federation of School Administrators.
American Federation of Teachers.
American Friends Service Committee.
American Jewish Committee.
American Jewish Congress.
American Postal Workers Union.
American Public Health Association.
Americans for Democratic Action.
Association of Performing Arts Centers.
B'nai B'rith.
Bazelon Center for Mental Health Law.
Bread for the World.
Catholic Charities USA.
Center for Community Change.
Center for Law and Education.
Center for Law and Social Policy.
Center for Science in the Public Interest.
Center for the Advancement of Public Policy.
Center on Budget and Policy Priorities.
Center on Disability and Health.
Center on Social Welfare Policy and Law.
Chicago Coalition for the Homeless.
Child Welfare League of America.
Children's Foundation.
Children's Defense Fund.
Church Women United.
Citizen Action.
Coalition for Low Income Community Development.
Coalition for New Priorities.
Coalition of Labor Union Women.
Coalition on Human Needs.
Colorado Rivers Alliance.
Common Cause.
Communications Workers of America.
Community Nutrition Institute.
Community Service Society of New York.
Consumer Federation of America.
Council of Graduate Schools.
Council of Jewish Federations.
Democratic Socialists of America.
Economic Policy Institute.
Environmental Action.
Environmental Justice Working Group.
Environmental Working Group.
Families USA.
Family Service America.
Food Research Action Center.
Friends Committee on National Legislation.
Friends of the Earth.
Fund for New Priorities in America.
Grassroots Policy Project.

[[Page S1179]]

Gray Panthers.
Hadassah.
International Association of Fire Fighters.
International Brotherhood of Boilermakers, Iron, Ship
Builders, Blacksmiths, Forgers and Helpers.
International Brotherhood of Teamsters.
International Federation of Professional and Technical
Engineers.
International Union of Electronic, Electrical, Salaried,
Machine and Furniture Workers.
Laborers' International Union of North America.
Leadership Conference on Civil Rights.
League of Women Voters.
Legal Action Center.
Libraries for the Future.
Lutheran Office for Governmental Affairs, ELCA.
McAuley Institute.
Mexican American Legal Defense and Educational Fund.
Migrant Legal Action Program.
National Association for Visually Handicapped.
National Association of Area Agencies on Aging.
National Association of Child Advocates.
National Association of Community Health Centers.
National Association of Letter Carriers.
National Association of Retired Federal Employees.
National Association of School Psychologists.
National Association of Service and Conservation Corps.
National Association of Social Workers.
National Caucus and Center on Black Aged, Inc.
National Coalition for the Homeless.
National Commission for Economic Conversion and
Disarmament.
National Council of Jewish Women.
National Council of Senior Citizens.
National Council on Aging.
National Council on Family Relations.
National Education Association.
National Family Farm Coalition.
National Family Planning and Reproductive Health
Association.
National Farmers Union.
National Hispanic Council on Aging.
National Jewish Community Relations Advisory Council.
National Low Income Housing Coalition.
National Minority AIDS Council.
National Neighborhood Coalition.
National Organization for Rare Disorders.
National Organization for Women Legal Defense and Education
Fund.
National PTA.
National Puerto Rican Coalition.
National Rural Housing Coalition.
National Senior Citizens Law Center.
National Treasury Employees Union.
National Urban League.
National Women's Law Center.
Natural Resources Defense Council.
Neighbor to Neighbor.
NETWORK: A National Catholic Social Justice Lobby.
Older Women's League.
OMB Watch.
OPERA America.
Paralyzed Veterans of America.
Peace Action.
Physicians for Social Responsibility.
Public Employees Department, AFL-CIO.
Service Employees International Union.
The American Association of University Professors.
The ARC.
The Enterprise Foundation.
Union of American Hebrew Congregations.
Unitarian Universalist Service Committee.
UNITE, Union of Needletrades, Industrial and Textile
Employees.
United Auto Workers.
United Church of Christ, Office for Church and Society.
United Food and Commercial Workers Union.
United Methodist Church, General Board of Church and
Society.
United States Student Association.
United Steelworkers of America.
United Transportation Union.
Wider Opportunities for Women.
Wisconsin Assembly of Local Arts Agencies.
Women and Poverty Project.
Women of Reform Judaism, The Federation of Temple
Sisterhoods.
YWCA of the USA.

Mr. LEAHY. Mr. President, paralleling the position of the 1,060
economists who banded together to oppose this constitutional amendment,
the 150 organizations that make up the Coalition for Budget Integrity
argue that the proposed amendment is likely to damage the economy more
than strengthen it. They note that the amendment would require spending
cuts or tax increases at just the wrong times. They are concerned that
the constitutional amendment would likely limit public investments by
failing to distinguish public investment from Government spending and
failing to allow for a capital budget. They correctly observe that the
constitutional amendment would draw the judicial branch into the
determination of fiscal and economic policy and undercut the
constitutional principle of majority rule with supermajority three-
fifths requirements to raise the debt limit and waive the provisions of
the amendment.
Mr. President, I also want to commend the honesty of Jack Kemp, who
appeared yesterday on the NBC News television program, ``Meet The
Press.''
Jack Kemp was quite honest in his appraisal of the so-called balanced
budget amendment to the Constitution.
Jack Kemp said yesterday on national television:

I have never been enamored with putting a budget balanced
amendment into the Constitution. . . . I would not vote for
the Stenholm balanced budget amendment because it clearly is
a trap into which, I think, a future Congress would end up
keeping taxes high or raising taxes in a recession. . . .
It's a recipe for a future disaster for this country.

Jack Kemp said what I believe many Members of Congress privately
believe, but are too afraid to say in public.
I believe Jack Kemp was right to speak his conscience and I hope more
Members of Congress will follow his courageous lead.
I yield the floor.
Mr. CRAIG addressed the Chair.
The PRESIDING OFFICER. The Senator from Idaho.
Mr. CRAIG. Mr. President, how much time remains on our side?
The PRESIDING OFFICER. The Senator has 11 minutes, 15 seconds. Who
yields time?
Mr. LEAHY. Mr. President, how much time remains to us?
The PRESIDING OFFICER. The Senator has 4 minutes remaining.
Mr. LEAHY. I withhold the remainder of my time.
Mr. HATCH. I yield 5 minutes to the distinguished Senator from Idaho.
Mr. LEAHY. I give control of our remaining time to the Senator from
Illinois.
Mr. CRAIG. Mr. President, let me first of all react to the Senator
from Vermont's inclusion of Jack Kemp's remarks of yesterday into the
Record. Jack Kemp does not support our balanced budget because he feels
it is not strong enough in one respect; it does not require the tax
limitation that Jack Kemp believes is necessary. Over the years I have
debated this at length with Congressman Kemp. He knows that what our
amendment does is a substantial movement in the right direction. While
I would have liked tax limitation over time, we know that is a vote
that cannot be won on the floor of the Senate or the House. That is why
we have left tax limitation up to the true limiters, and that is the
electorate, to decide if a tax increase should produce a change in the
makeup of the U.S. Congress. So we are not going to put our Government
on automatic pilot, as would be the subtle insinuation of Senator
Durbin in arguing that, somehow, this amendment is not flexible enough
and therefore we need his majority-vote waiver.
Let me talk about putting whims in the budget process, because I
believe that is exactly what would be done if you favor the Durbin
amendment. It does not require this Senate to make tough choices, and
it creates almost an unlimited opportunity for deficit spending. The
balanced budget amendment as we have proposed it, and as it has been
introduced on the floor of the Senate by Senator Hatch, is flexible
enough. It allows deficit spending if 60 percent, or three-fifths of
the majority of the Congress, vote that way. If there is a true long-
term emergency, the votes will be there to respond to it.
Let me cite some examples. The Senator from Illinois knows these
examples. He has participated, as have I, in a fair number of them.
From 1962 to the present, there have been 12 economic stimulus packages
passed by Congress. All 12 have received three-fifths votes in the
Congress. So, every time there was a true emergency and collectively
the Senate or the House decided it was just that, the three-fifths
majority written into this balanced budget amendment was garnered. In
other words, when there is legitimacy, and not just the easy pass go
that we have had now for decades upon decades, that has built the stack
of unbalanced budgets here on this table, but when it was really
necessary, the record clearly shows that the support of three-fifths of
the Congress was there.
Of course, there was one so-called economic stimulus package that did
not pass at first. We got involved in a

[[Page S1180]]

filibuster in 1993 on a so-called stimulus package, but at that time a
recovery was already underway. Every economist in the country said,
``We are in a recovery; why are you pumping more deficit spending into
the economy and risking a surge of inflation?'' And, of course, we did
filibuster, and that deficit spending package failed, largely because
it was nickel-and-dime kind of stuff, to build a swimming pool here or
paint a mural there or create some kind of make-work somewhere else. It
had nothing to do with job training to a great extent, or job creation.
Yet some were pushing it, even when economists were saying, ``Yes, in
fact, the economy is recovering.''
But even when that first, large bill did not pass in 1993, an
overwhelming majority of the Congress still showed compassion for those
actually in need; we soon passed a stripped-down bill, which extended
unemployment benefits.

While we do not use the word ``emergency'' in the balanced budget
amendment, clearly an emergency is whatever three-fifths of the
Congress term it is. That is a reasonable test of what is a true
emergency. So, those 12 economic stimulus packages that I referred to
since 1962 were deemed by the Congress to be important enough to garner
the three-fifths vote. Therefore the other day, several weeks ago, when
the President said, ``If you had a little flexibility in there for a
recession,'' and he was visiting with those of us who were proponents
of this amendment, then he ``would show some kind of interest in it.''
I said, ``Well, it is there, Mr. President. You need to recognize that
we saw those needs and that is why we put inside the amendment the
three-fifths requirement that would be necessary to deficit spend.''
Some have said that recessions are often regional, that there are
economic areas within our country that fail to respond to recovery, and
that economics shifts occur unevenly. They say, without the Durbin
amendment, it would be hard to provide relief in those cases. If that
is the case, why has there not been why has there not been a long list
of regional recession relief bills that have been defeated? Or that
have passed only narrowly? No, the Congress has responded in time of
need and that is why all of these bills have gotten the three-fifths
vote that we thought was a necessary safeguard for this amendment.
The Durbin amendment is based on a fundamental mistake. Let me repeat
that. The Durbin amendment is based on what I believe to be a
fundamental mistake. Regularly balanced budgets do not harm the
economy, but saying they do is the mistake he makes. He assumes, as
does the Secretary of the Treasury, that somehow balanced budgets are
dangerous for the economy, or could create or worsen a downturn. And
yet economists, liberal and conservative, argue a that balanced budgets
will lead to a sustained 2- to 2.5-percent drop in the overall interest
rates. They would create jobs and a higher standard of living.
I see that as an economic stimulus. The balanced budget amendment
would create economic stimulus. Regularly balanced budgets would help
the economy. And yet we still recognized the need for putting into the
amendment some flexibility in the case of a recession and Congress
needing to respond to it.
The Durbin amendment simply guts the balanced budget amendment. It
would let a majority waive the requirement for a balanced budget on a
whim. It does not require that there be a real recession, merely that
Congress declare one. It would not just allow the amount of deficit
spending supposedly necessary or unavoidable because of an economic
emergency--it would allow unlimited deficit spending.
If you go back and look at history, you find that economic growth was
greater, and average unemployment was lower, during those periods in
which budgets were regularly balanced.
In fact, if Congress had passed the balanced budget amendment the
first time I voted for it in 1982, the typical family's income would be
$15,500 higher today. That is not my number, but was estimated by the
Concord Coalition. According to the General Accounting Office, if we
balance the budget and keep it balanced, after 20 years, our children's
standard of living will be between 7 and 36 percent higher.
Deficits are the problem. The debt is the threat to the economic
security of our children, our seniors, and those who are vulnerable to
changes in the economy. Former Senator Paul Simon brought in liberal
economists who told us that the debt and deficit are so big, deficit
spending is now useless as an economic stimulus.
The evidence does not show that balancing the budget makes recessions
more severe. Investors Business Daily pointed last week to a 1986 study
the National Bureau of Economic Research that said, when you adjust for
the different way data were collected before World War II, prewar and
postwar recessions did not really differ significantly in length and
severity.
While the balanced budget amendment already, with its three-fifths
vote requirement, anticipates the need to respond to a serious, long-
term economic problem, the Durbin amendment seems concerned with a
rapid response to short-term swings. But Congress has a notoriously bad
track record when it comes to short-term responses to the economy.
Every economic stimulus or anti-recession bill since 1949 was passed
by Congress after the recession was over. But the Durbin amendment
still requires Congress to vote to waive the balanced budget
amendment--meaning it does not allow a prompt response, just an easy
evasion.
The Durbin amendment has nothing to do with so-called automatic
stabilizers. The balanced budget amendment already allows for automatic
stabilizers. Section 6 of the balanced budget amendment allows for the
honest, good-faith use of estimates in legislation that implements a
balanced budget. Read the committee report: If Congress makes good-
faith, reasonable estimates of receipts and outlays, and then mid-year
changes in the economy cause a temporary deficit, that would not
trigger a three to five vote. Unemployment benefit checks, for example,
would still go out.
The problem is that we now have permanent deficits, in good times as
well as bad.

Conclusion

We do not need a loophole in the balanced budget amendment--like the
Durbin amendment. We need to change the bleak status quo. Our $5
trillion debt--growing by more than $8,000 a second--proves that we
have a long-term problem. This stack on the Senate floor of the last 28
unbalanced budgets--14 of which promised balance but did not deliver--
demonstrates that this problem requires a permanent solution. If we
pass the balanced budget amendment, we will create an economic bill of
rights for the 21st century.
The PRESIDING OFFICER. The Senator's 5 minutes have expired.
Mr. HATCH. I yield 1 minute.
Mr. CRAIG. Mr. President, let me draw to a conclusion my debate on
this amendment, because I hope that we can table this amendment. I see
no reason to write that kind of language into the Constitution. We have
given clearly the kind of flexibility that the Congress has needed in
the past to respond.
It isn't by accident that we picked three-fifths. When you go back
and analyze past actions of Congress and economic stimulus packages
that meet the definition of an emergency or what's needed for
recessionary recovery, that is exactly what this amendment is designed
to respond to. I believe it does, and I hope that our colleagues will
join with us in tabling this effort.
Mr. President, I yield back the remainder of my time.
The PRESIDING OFFICER. Who yields time?
Mr. DURBIN addressed the Chair.
The PRESIDING OFFICER. The Senator from Illinois.
Mr. DURBIN. Mr. President, I understand I have 4 minutes remaining;
is that correct?
The PRESIDING OFFICER. That is correct.
Mr. DURBIN. Thank you, Mr. President. I will use this to conclude my
remarks.
I want to first thank my colleague, the Senator from Utah, for this
debate, for his fairness throughout this debate and the prior debate,
though we clearly disagree on a very important issue. I thank him for
the fairness with which he has handled this debate and allowed me the
opportunity to express my point of view.

[[Page S1181]]

I said at the beginning of this debate I don't think there is a more
serious vote that a Member of the House or Senate could make, absent a
vote on whether the United States goes to war, than a vote on whether
we amend this Constitution. When you think that on only 17 occasions in
the 205 years, since 1791 have we actually amended this great document,
each of us should pause and reflect and make certain that what we bring
to the legislatures of this Nation for consideration is the very, very
best.
What we are talking about today, I think, is a critically important
part of this debate. It is important because, as the Senator from
Vermont, who was kind enough to join me in this debate, said, we are
talking about the ability of the American people through their
Government to respond to an economic emergency.
There are those who would argue we need a supermajority, and history
tells us in the last 2 years, the requirement of a majority vote
resulted in gridlock and Government shutdown and national
embarrassment. I worry that at some future date in the midst of an
economic downturn, after this budget has been pared back dramatically
to reach balance, when there are people and groups in this town, like
hungry dogs on one bone, trying their very best to preserve something,
requiring a supermajority vote to step up and help working families get
back on their feet could be an invitation to gridlock at a time when
those families need us the most.
Mr. President, I close by making a final request to the fairminded,
to the judicious chairman of this committee in asking him for one last
consideration, and that is that we have the yeas and nays on the merits
of this amendment. I think I know the outcome, but let us preserve in
this debate an up-or-down vote on this question. Let us give, in the
course of this debate, to the American people our best judgment on the
merits.
Let us not have this question, I think critical question, masked by
some procedural vote that will suggest that this amendment on its face
does not merit a yea-and-nay vote in the Senate. I think it does, and I
would gladly give that right to any Senator in their effort to improve
on a modification of a document which we all value and revere, the
Constitution of the United States.
Mr. President, I ask for the yeas and nays on my amendment.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The yeas and nays were ordered.
Mr. HATCH addressed the Chair.
The PRESIDING OFFICER. The Senator from Utah.
Mr. HATCH. How much time is remaining?
The PRESIDING OFFICER. The Senator has 5\1/2\ minutes.
Mr. HATCH. Mr. President, I will only take a few minutes. I want to
thank the distinguished Senator from Illinois for the kind way he has
conducted himself on this amendment. He has a wonderful personality. He
did a very good job in our committee, and I think he has done a very
good job here on the floor.
In all honesty, his amendment would drive huge loopholes into the
balanced budget amendment and make it, basically useless, because
almost anybody could claim almost any type of event as an economic
emergency. That would trigger his amendment and do away with the
balanced budget amendment.

There is one thing I would like to clarify. My good friend from
Vermont talked about Fred Bergsten. Fred Bergsten suggested we shoot
for a small annual surplus to be used during the course of each fiscal
year. Mr. Bergsten is a Keynesian who believes fiscal policy will work
better if the cycles are above the zero balance line rather than below.
The fact the past surpluses accumulated in past years cannot be used
without a three-fifths vote puts a lock on our savings, so such savings
will not be used willy-nilly. But the best use of surpluses will be to
pay down our debt. If Congress decides to use accumulated surpluses, it
will be easier to get a three-fifths vote to use savings than to
borrow, and that is the point I am making.
Let me just conclude with the thought that the Durbin amendment is an
unnecessary loophole that would, basically, make the balanced budget
amendment, once a part of the Constitution, very ineffective. Congress
can respond appropriately to real needs, but we need the increased
protections of Senate Joint Resolution 1 to protect future generations.
I worry about our children and our grandchildren and their children.
I worry about whether people are going to have good jobs in the future.
I worry about whether it is going to take a bushel barrel of dollars to
buy a loaf of bread. I worry about whether we are going to monetize
this debt, as the distinguished liberal Democrat Senator from Illinois,
Senator Durbin's predecessor, Paul Simon, has always said will happen.
If we monetize this debt, this country, as we know it, will be gone,
because people will no longer believe in the credit of the United
States. If we inflate our economy to pay off our huge national deficits
and debt, we are ultimately going to wind up where we will have
inflation that would eat every working person's lunch every day.
If you really love the poor, if you really love senior citizens, if
you really love our children and grandchildren, if you really love the
future of this country, then we can't have loopholes like this blown
into the balanced budget. We have to stand up and vote for a strong
balanced budget amendment. It is difficult, I have to admit. It makes
life a little more difficult for us as Members of Congress, but don't
you think it is time to end these unbalanced budgets? Here are 28 of
them, the last 28 years, and without this amendment, it will go on
forever and our children's future will be gone.
I yield back the remainder of my time.
Mr. CRAIG addressed the Chair.
The PRESIDING OFFICER. The Senator from Idaho.
Mr. CRAIG. Mr. President, I move to table, and I ask for the yeas and
nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
lay on the table the amendment offered by the Senator from Illinois
[Mr. Durbin]. The yeas and nays have been ordered. The clerk will call
the roll.
The bill clerk called the roll.
Mr. NICKLES. I announce that the Senator from Pennsylvania [Mr.
Santorum] is necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 64, nays 35, as follows:

[Rollcall Vote No. 7 Leg.]

YEAS--64

Abraham
Allard
Ashcroft
Baucus
Bennett
Biden
Bond
Brownback
Bryan
Burns
Campbell
Chafee
Coats
Cochran
Collins
Coverdell
Craig
D'Amato
DeWine
Domenici
Dorgan
Enzi
Faircloth
Frist
Gorton
Graham
Gramm
Grams
Grassley
Gregg
Hagel
Hatch
Helms
Hollings
Hutchinson
Hutchison
Inhofe
Jeffords
Kempthorne
Kyl
Lott
Lugar
Mack
McCain
McConnell
Moseley-Braun
Murkowski
Nickles
Reid
Robb
Roberts
Roth
Sessions
Shelby
Smith, Bob
Smith, Gordon H.
Snowe
Specter
Stevens
Thomas
Thompson
Thurmond
Warner
Wyden

NAYS--35

Akaka
Bingaman
Boxer
Breaux
Bumpers
Byrd
Cleland
Conrad
Daschle
Dodd
Durbin
Feingold
Feinstein
Ford
Glenn
Harkin
Inouye
Johnson
Kennedy
Kerrey
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Mikulski
Moynihan
Murray
Reed
Rockefeller
Sarbanes
Torricelli
Wellstone

NOT VOTING--1

Santorum

The motion to lay on the table the amendment (No. 2) was agreed to.
Mr. HATCH. Mr. President, I move to reconsider the vote.
Mr. LOTT. I move to lay that motion on the table.
The motion to lay on the table was agreed to.

Unanimous Consent Agreement--Amendment No. 3

Mr. LOTT. Now, Mr. President, I ask unanimous consent that at 2:15 on

[[Page S1182]]

Tuesday, February 11, there be 60 minutes of debate, equally divided,
in the usual form prior to a vote on or in relation to the Wellstone
amendment No. 3, and following the expiration or yielding back of the
time, the Senate proceed to a vote on or in relation to the Wellstone
amendment.
The PRESIDING OFFICER. Without objection, it is so ordered.

Order of Procedure

Mr. LOTT. Mr. President, for the information of all Senators, there
will be no further votes this evening. It is my understanding that
Senator Boxer intends to make a statement relative to the
constitutional amendment. Also, the President of the United States will
be visiting with congressional leaders tomorrow on the Senate side of
the Capitol--in fact, in the President's Room just off the floor of the
Senate Chamber. Therefore, it is my hope that when the Senate convenes
following the weekly policy party luncheons, there will be a short time
agreement for debate prior to a vote on or in relation to the Wellstone
amendment regarding underprivileged youth. Members should expect a vote
relative to the Wellstone amendment in the 3 o'clock timeframe
tomorrow. Also, the Senate could be asked to confirm the nomination of
Congressman Richardson to be Ambassador to the United Nations.
Therefore, a rollcall vote is expected with respect to that nomination.
I thank my colleagues for their cooperation.
I yield the floor.
Mrs. BOXER addressed the Chair.
The PRESIDING OFFICER. The Senator from California is recognized.
Mrs. BOXER. Thank you very much, Mr. President. Before he leaves the
floor, I would like to personally thank the newly elected Senator from
Illinois, Senator Durbin, for his leadership on this extremely
important amendment that he offered the Senate, which would have made
this balanced budget amendment a much more attractive amendment to the
people of Illinois, to the people of California, to the people of all
of our States--to the Nation.
A very interesting poll just came out in the February 9 edition of
The Los Angeles Times, some people, when asked in the abstract, said
they would support a balanced budget amendment to the Constitution,
under any circumstances. However, about 39 percent of the people polled
said they would not support the balanced budget amendment if it could
mean cuts in areas that they overwhelmingly approve of, such as
Medicare, Social Security, and Medicaid.
I learned at a very early age from my parents what it was like to
live through a depression. There was no safety net then in the 1930's,
and people were literally committing suicide because there was no
safety net. They didn't know what they were going to do for their
families, and they were absolutely filled with despair.
We have learned a lot since then, and Senator Sarbanes, with his
charts, has shown us that we learned a lot since the Great Depression,
and that we have the ability to soften those recessionary periods. Yet,
in this inflexible amendment that is before us, it would take a
supermajority, Mr. President, to act on behalf of the American people.
Now, I did not come here to this great Senate to have my hands tied in
the case of a recession, a depression, or a natural disaster.
I want to thank my friend from Illinois for raising that issue as
well. He has gone through the Midwest floods, as I have gone through
the California floods, earthquakes, and fires, and there but for the
grace of God goes every single one of us in this Chamber. And if we
cannot act as a majority, without the requirement of a supermajority,
to meet the needs of the people, then what are we doing here?

By rejecting this amendment of the Senator from Illinois, which he
was so eloquent in explaining, I truly believe that this amendment, as
it stands, is dangerous. It is dangerous for our people.
Mr. SARBANES. Will the Senator from California yield for a question?
Mrs. BOXER. I am delighted to yield to my friend.
Mr. SARBANES. The Senator made reference to this earlier, and I think
the very able Senator from California is on to an extremely important
point here. I want to illustrate it with this chart.
The PRESIDING OFFICER. Senators in the rear of the Chamber will cease
conversations. Take the conversations outside the Chamber.
The Senator from California is recognized.
Mrs. BOXER. Mr. President, what we are talking about here, because we
have voted down this extremely important amendment, is, how are we
going to act in this U.S. Senate to ease the pain of people during
recessions or other economic emergencies. People who are jobless, who
have no health insurance or who can't afford to pay their rent?
I am happy to yield to my friend.
Mr. SARBANES. Well, as the Senator has noted, as economists across
the country have commented, and as the chart beside me shows, since
World War II we have been able to ease the business cycle because we
experience automatic stabilizers during an economic downturn. We start
running deficits because we are not collecting taxes and we are paying
out unemployment. If you try to balance the budget, or if you are
required to do so by constitutional amendment during an economic
downturn, you are going to return our economy to these boom-and-bust
cycles that we experienced throughout the first part of this century
and we are going to lose the ability to have this kind of movement in
the business cycle, which is much better for our people.
The Senator is absolutely correct. With this amendment, we are going
to be dooming ourselves to going back and turning economic downturns
into recessions and recessions into depressions, as the Senator has
pointed out.
Mrs. BOXER. Exactly. I would say to my friend that you have to learn
from history. If we can't learn from history, we are doomed to fail the
people. Some of us have heard about these depressions from our parents.
Look at the Senator's chart. We can clearly see what has happened since
World War II. We have spared our people from the deepest, darkest days
of recession and depression.
By rejecting the amendment offered by the Senator from Illinois,
which would have given this U.S. Senate and the House the ability to
act without requiring a supermajority in times of recession, this
becomes a very radical amendment to the Constitution.
Does my friend not agree?
Mr. SARBANES. I agree absolutely with that. We at the moment have the
best unemployment situation in 20 years; the best performance on
inflation in 30 years. We have now brought the deficit down as a
percent of the gross national product to the best ratio in 25 years. We
are making progress on all of these fronts. We have the strongest
economy in the world.
People come in with this radical notion of amending the Constitution
of the United States. All we need to do is continue to make the hard
decisions that are made with respect to the budget. It is one thing to
balance the budget. Those are the tough decisions. Those are the ones
we ought to make and not put an amendment into the Constitution of the
United States which is going to deny us the ability to deal with
economic downturns and recessions when they occur. The amendment they
are talking about putting into the Constitution of the United States
does not abolish the business cycle. It does not eliminate economic ups
and downs. Yet with this amendment, we run the risk of going back to
economic cycles with very deep downturns when our people are really
suffering through depression. We have not had that since World War II.
And I for one don't want to go back to it.
Mrs. BOXER. I want to thank the senior Senator from Maryland for his
leadership on this. I have the honor and privilege of serving with him
on the Banking Committee, where he is the ranking member, and on the
Budget Committee, where we serve together. So we have a chance to
debate and discuss these issues. A great privilege it is always to have
the participation of my friend from Maryland because he brings such
insight.
I say to my colleague that he and I have voted for balanced budgets
in the past. That is why this amendment debate is really a figleaf. As
my friend pointed out, it does not do one thing to balance the budget.
I am going to show some most extraordinary newspaper articles which

[[Page S1183]]

have appeared as editorials or as op-eds. The writers of those articles
call this balanced budget amendment what it is--a technique for people
to say, ``Oh, I voted to balance the budget,'' even though in many
cases these colleagues didn't vote for the one budget in 1993 that my
friend from Maryland and I voted for along with a bare majority of the
Senate which has set this country on a course of 4 years of declining
deficits and has set this country on a course of economic prosperity.
We have far to go, but we are moving in the right direction. The vote
that mattered, I say to my friend, was the vote that we cast, the tough
vote--and some people lost their seats because of it--that made the
actual changes in budgetary policy which has cut this deficit from $290
billion when George Bush left office to where it is today at about $107
billion. That was the tough vote.
This vote is an easy vote. We are just setting the stage for the
States to call conventions in order to ratify the amendment. And even
if it is approved by the States, in the end, there is a real
possibility that there will be a disagreement and the courts will be
called upon to try to resolve the situation.

So it makes no sense. That is why 1,100 economists condemn the
balanced budget amendment as unsound and unnecessary. I know that this
statement has been quoted time and time again.
I see that my friend is on the floor now with some very important
numbers. I am happy to yield to him.
Mr. SARBANES. I want to support the very perceptive statement of the
distinguished Senator from California about the reduction in the
deficit subsequent to the enactment of the 1993 budget, which, as the
Senator pointed out, was passed on the tie-breaking vote of the Vice
President.
In 1992, the deficit was $290 billion. We have brought it down 4
years in a row. It is now at $107 billion. Four years in a row we have
had a steady decline in the deficit. We brought it down from $290
billion to $107 billion, and, as a percent of our gross product, the
deficit has dropped from 4.9 percent in 1992 to 1.4 percent in 1996.
The last time the deficit was this low as a percent of our gross
domestic product was in 1973. This is the best performance in 23 years
in reducing the deficit as a percent of our gross domestic product.
This is a very good record. We are going to continue the progress. We
are going to continue to bring the deficit down, both in absolute terms
and as a percentage of our GDP.
Let me show you a chart which compares what we have succeeded in
doing in this country and what is happening in the other major
industrial countries.
This chart compares various nations' deficit as a share of GDP. The
United States is now at 1.4 percent. Here is Japan, 3.1; Germany 3.35;
Canada 4.2; France 5; the United Kingdom 5.1; Italy 7.2. We have the
best performance of any of the major industrial countries.
We have an economy now with 5.4 percent unemployment, the best
unemployment in 20 years. We are at less than 3 percent inflation, the
best inflation performance in 30 years. The deficit of 1.4 percent of
GDP, the best since 1973. That is a vertical comparison with our past
performance in this country.
Then we look to see how we are competing with other countries. This
chart shows we have the best performance of any of the G-7 countries.
This economy is working. We ought not now to take this, as the Senator
has described it, radical step of trying to amend the Constitution of
the United States and perhaps dooming ourselves in some future crisis
to be unable to confront the economic circumstances of the time. As the
Senator has pointed out, that is what these over 1,100 economists
across the country are saying.
I thank the Senator.
Mrs. BOXER. I thank my friend and colleague.
I think the record is clear. We are making progress, and what we
ought to be doing now is debating how we make further progress. Instead
we are spending many, many hours discussing an amendment to the
Constitution which does not one thing to continue this progress.
These economists, including 11 Nobel laureates in economics from
Stanford University, the University of California at Berkeley, New York
University, Carnegie-Mellon, Yale, and MIT--you can't have a better
group of people who know what they are talking about. Some of what they
say is, ``We condemn the proposed balanced budget amendment to the
Federal Constitution. It is unsound and unnecessary.''
I received a degree in economics many years ago, and I know that
economists choose their words carefully because economics is not an
exact science. As a result, economists try very carefully to measure
their tone and measure their words. So when you have 1,100 economists
signing on to this, and using the word condemn, this is serious
business. Now, maybe there are colleagues in the Senate who could stand
up to some of these people and tell them they are incorrect, but I have
a hard time believing that.
Let me sum up what they said. And it just parallels what the Senator
from Maryland has shared with us.

The amendment is not needed to balance the budget. The
measured deficit has fallen dramatically in recent years from
$290 billion in '92 to $107 billion--

They say:

The deficit is 1.3 percent of gross domestic product, a
smaller proportion than that of any other major nation.

The Senator from Maryland has said this very same thing. They go on
to say:

Congress and the President can reduce the deficit to zero,
balance the budget or even create budget surpluses without a
constitutional amendment.

These 1,100 economists close by saying:

There is no need to put the Nation in an economic
straitjacket. Let the President and Congress make fiscal
policy in response to national needs and priorities as the
authors of our Constitution wisely provided.

Now, Mr. President, I am so honored to be in this Senate representing
the largest State in the Union. It truly is an honor. I am humbled by
it. I am humbled by our Constitution. And so I think we need to be
pretty humble when we think of how we are going to vote on this. I
think we have to be humble. I think we have to look at what the experts
tell us. I think we have to look at the facts as they have been laid
before us by my friend from Maryland. Our economy is moving in the
right direction.
Having a balanced budget amendment to the Constitution would in fact
put us in a straitjacket, would in fact tie our hands, would in fact
make it very difficult for us to get out of an economic crisis when we
may have to temporarily go out of balance while we take care of it.
Let me ask a question of my friend from Maryland, who is still in the
Chamber.
In his State he has been fortunate not to have had the number of
natural disasters that I and the people of my State have had to face.
He knows this place, however, because he has been here a long time, and
the people of Maryland keep sending him back for a reason--because he
is wise. So I ask my friend, under this amendment as it is proposed--
and particularly since this Senator Durbin's recession amendment was
defeated--California was in a horrible recession, the worst in the
country. We moved from an economy that was heavily supported by jobs in
the defense sector, to an economy without the great dependence it once
had on defense sector jobs, and we had a very hard time. We made
investments that softened the blow but still it was tough. Then we got
hit with an unbelievable earthquake called the Northridge earthquake.
Because the Federal Government acted swiftly, because we could act
without having to have a supermajority, we were able to pump $11
billion into the California economy to rebuild the infrastructure. We
are rebuilding the universities. We are rebuilding hospitals. We are
rebuilding people's lives.
I say to my friend, I will offer an amendment to waive the
requirements of a supermajority in case of natural disasters such as
earthquakes, fires, floods--where people are homeless and in trouble.
Under the amendment as it stands now, however, if any State had a
disaster like that which occurred in California, with $11 billion of
damage and people hurt and suffering, does my friend believe we could
get the required supermajority to act swiftly?
I have very grave doubts about it, because I have seen us have a hard
time even getting 51 votes. I ask my friend,

[[Page S1184]]

would he want to be here representing a State that had a disastrous
flood or earthquake or any other natural disaster and have this
amendment in place which requires a supermajority?
Mr. SARBANES. The Senator from California asks a very appropriate
question. In a sense, she answered it right at the end with the
observation that she herself has, as I have, seen instances in this
Chamber when we were scrambling to get a simple majority in order to
provide disaster relief to one or another State in the country that had
been devastated by a natural disaster. And many Members said, ``Well,
we don't really want to do that. Yes, it's a difficult situation, but
we don't want to make this response.''
I have seen the very able Senator from California personally work the
floor of the Senate in order to try to get a majority vote in order to
respond to what her State had been stricken with, and she was
successful, I must say. But suppose you had to get a supermajority in
order to do it. Past experience does not bear out the assumption that
you can just get a supermajority willy-nilly. In the past, we have had
to scramble simply to get a majority.
The amendment contains a provision that states that you cannot raise
the debt limit unless you have a supermajority, and obviously unless
you can raise the debt limit and borrow additional funds, you are not
going to be able to respond to the disaster, and particularly not
respond to it immediately, which is often what is required. But time
and time again in this Chamber I have seen the leadership sweating
bullets in order to get a simple majority in order to deal with a debt
limit issue. So it just defies past experience for Members to stand
here and say, ``Oh, we will get the supermajority.'' As the Senator
from California has pointed out, it is tough enough to get the
majority, the simple majority.
Mrs. BOXER. I give my friend an example. The San Francisco
earthquake, Loma Prieta, which was way back, we are still rebuilding
from, I say to my friend. And we had a freeway go down, just a
disaster, and we got the funds to rebuild the freeway. About 2 years
ago on the floor of this Senate a Senator said we have to back off this
because we are building it in a different fashion and it is costing too
much money.
I stood up as one of the two Senators from California and explained
that if we rebuilt it the same way it was prior to the earthquake, it
would fall down again. We had to put a little more into it to make sure
that the structure was as safe as possible--to ensure that the
residents traveling on the freeway would be safe.
Well, I won that vote, but I have to tell you it was close, I say to
my friend.
Under this constitutional amendment, there is no way I could have
done that because it would have required a supermajority--we would have
needed to be out of balance for a short period of time because of the
unanticipated funds required to respond to the disaster. And I say to
my friend that, if any State experiences a multibillion dollar
disaster, unless you can come on the floor and convince colleagues to
cut other programs, you are going to be in deep trouble. That is the
other reason why this is a very, very radical amendment.

I want to say to my friend, I so appreciate his participating in this
discussion. It means a lot to me that he is here. As a matter of fact,
it reminds me of one time out in California when he was at a forum with
me, when most people had gone home. It was a situation very similar to
tonight.
But I want to say to my friend, as we sit on the Budget Committee
together, there is one figure who comes before the Budget Committee
that my colleagues on the other side of the aisle just think is the
best. They credit this person with everything good about the economy,
and his name is Alan Greenspan. I think Alan Greenspan is doing a good
job. I sometimes disagree with him, but overall I think he has done a
good job. Where is Alan Greenspan on this constitutional amendment to
balance the budget? Let me say--I am not going to read his whole
statement, but I think this sums it up:

As a consequence, what I am concerned about is that it is
very difficult to implement technical economic policy through
the Constitution. I don't like the idea of embodying concrete
economic issues in the Constitution, which is going to have
to stay in the Constitution for 50 or 100 years or more.

So I find it really interesting that on every single economic issue,
my colleagues on the other side of the aisle--who all support this
amendment; I do not think there is one of my colleagues on the other
side who is going to vote the other way--have abandoned Alan
Greenspan's leadership, where they have followed him down every other
economic road. Again, I ask my colleagues to be a little humble on
this. We do not have all the answers. None of us has all the answers.
But, certainly, if you are going to walk away from someone who you
think has been right on target, keeping inflation under control,
keeping the economic recovery going, and he is telling us not to do
this, it seems to me fairly arrogant to disregard it.
I would like to share with my colleagues what I think is a terrific
editorial that appeared in the Los Angeles Times. As a matter of fact,
it is so good I am going to read you most of it. I honestly think this
says it the way it is. It speaks for me.

Balanced Budget Plan: Looks, 10; workability, zero.
This seductive idea won't stand up under close inspection.

Here is what it says:

No. 1 on the legislative menu of the new 105th Congress is
a Republican-backed constitutional amendment to require a
balanced budget by the year 2002 and every year thereafter.
What could have more first-glance appeal? But amending the
Constitution, despite the political symbolism, is not the way
to go about controlling government spending.
On Tuesday, President Clinton voiced his strongest
opposition yet, appropriately characterizing the proposed
amendment as a ``straitjacket'' that pays little regard to
the vagaries of the economy. For instance, it would not
provide the flexibility needed to deal with recessions . . .

My friend and I from Maryland, we have gone through this, I think, in
a detailed way. It says:

. . . it would not provide the flexibility needed to deal
with recessions, when Federal funding might have to rise as
revenues drop. The proposal would allow suspension of the
balanced budget requirement only if three-fifths of each
House approved. That's not much of an escape valve,
considering how long it takes Congress to act on most
problems . . .

We know that. It takes us time to gear up around here, as the
President is going to learn as he enjoys his stay in the Senate. So, in
time of recession, we are often behind the curve as it is. We come in
the second quarter, after the recession.

The amendment, pushed through the Senate Judiciary
Committee on Thursday, generally fails to spell out how a
balanced budget would be achieved. The difficult decisions on
what spending to cut or how to raise revenues are not
addressed but simply are left to future Congresses--and
everyone knows how difficult and seemingly endless budget
negotiations can be in the Capitol . . .

The article closes by saying:

The amendment--which will be put before the States'
legislatures if it wins approval in the House and Senate--has
drawn opposition from a broad spectrum of economists and
fiscal experts. It should. The amendment is irresponsible
governance, fiscally reckless and a false political star.

The Los Angeles Times is not known for such strong language. It is
very measured. The editorials are very measured. So let me repeat that:

The amendment is irresponsible governance, fiscally
reckless, and a false political star.

The last article which I want to mention comes from the USA Today, on
Monday, February 3, 1997. The headline reads:

This is cheap political grandstanding. There is an easier
way to balance the budget: Just do it.

``Just do it.'' It says, ``Balance The Budget? Yes. But An Amendment?
No.''
So, whether it is our worry about being in a straitjacket when there
is a recession or a natural disaster, or whether it is our worry about
the Social Security trust fund--which absolutely will be hit if an
amendment does not carry the day to exempt it--or whether it is our
worry about Medicare--all of these areas are at great risk if we
continue with this proposal, which has been condemned by 1,100
economists. Editorials all over the country have pointed out that
passing a balanced budget amendment to the Constitution is just not a
wise thing to do.

[[Page S1185]]

We can and must balance the budget. I voted for six balanced budgets.
I am very proud of that. I am proud to see the deficit coming down. It
is a serious matter. I hope, however, my colleagues will have the
courage to walk away from an idea that seems wonderful on its face, but
if you look behind the door, you will see the pitfalls there.
I thank you, Mr. President, for your kind courtesies. I thank my
colleague from Maryland for participating in this discussion with me. I
hope, as we go down the road on this debate, we will have some more
colleagues step away from this at-first-glance politically popular idea
and realize that it will put us in an economic straitjacket with no way
to respond to recessions or other economic emergencies or crises. So it
is putting us into a straitjacket which can only harm the people.
To close: ``Balance The Budget? Yes. But An Amendment? No.''
There is an easier way to balance the budget: Just do it.
Mr. President, I yield the floor.
The PRESIDING OFFICER. The Senator from Maryland.
Mr. SARBANES. Mr. President, what is the parliamentary situation?
The PRESIDING OFFICER. We are on the Wellstone amendment, No. 3.
Mr. SARBANES. I thank the Chair. Mr. President, I commend the very
able Senator from California for her very fine statement. She clearly
understands the pitfalls that are involved in a balanced budget
amendment and, I think, has spoken eloquently to the issue. She has
also spoken with a very deep personal knowledge of the situation
confronting her and her State when she has had to deal with these
natural disasters. I simply want to underscore, again, for those who
say, ``well, we will easily get a supermajority in order to waive the
provisions of this amendment in an emergency situation,'' that I saw
the Senator working literally day and night just to get a majority in
order to deal with a natural disaster and, as she pointed out, coming
up with close votes in order to do it.
She succeeded, which is very much to her credit and reflected her
very effective advocacy. But had a supermajority been required, she
would have fallen short. So I want to thank her for her very strong
statement.
Mr. President, I know it is late into the evening, and I am not going
to take long, but I want to take just a few minutes to speak to the
issue before us, and I hope at a later point to make a longer
statement.
First of all, I want to point out, as we deal with this amendment to
amend the Constitution to require a balanced budget, it is very
important to understand that the budget we are talking about balancing,
the U.S. budget, does not have a capital budget to it. Everyone gets up
and says, ``well, the State governments do it, the local governments do
it, private individuals do it, corporations do it, why shouldn't the
Federal Government do it?''
None of those other entities balance a capital budget as well. They
all provide for capital budgets that are financed by borrowing. That is
what State governments do. They have a requirement to balance the
operating budget, but they then sell bonds. Why do States and
municipalities issue bonds? Why is there a municipal bond market?
Because they borrow in order to fund the capital budget.
We don't have a capital budget at the Federal level, and anyone who
is really serious about trying to write requirements into the
Constitution, which, by the way, I think are extremely difficult to do
because you can't provide for every contingency, but if you had any
degree of seriousness, would first provide for a capital budget. You
would set capital investments apart and say, ``all right, we recognize
we make investments in the future and we capitalize them, and we borrow
to fund the capitalization.''
That is what people do when they buy a home. Although it is said that
everybody has to balance their budget, people don't balance their
budget every year. It is wise and prudent financial policy, if your
income is adequate to the task, to borrow in order to buy a home, to
borrow in order to buy a car.
If individuals had to operate under this amendment's balanced budget
requirement, the vast majority of people in this country would not be
able to buy an automobile and they would not be able to buy a home,
because they couldn't produce the cash with which to make the full
payment in the year they incur the obligation, which is what this
amendment is requiring of the Federal Government.
So that is the first point to make. You are talking about trying to
balance a budget that includes within it your capital expenditures,
instead of setting them aside and funding the capital expenditures
through a capital budget, which is financed by borrowing and which
makes prudent economic sense. After all, the highway or the building is
going to last you for 20, 30, 40 years, and it makes sense to borrow,
to amortize it over that period of time and have the use of it right
from today out into the future.
The second point I want to make about the balanced budget amendment
is in the post-World War II period, we have used what are known as
automatic fiscal stabilizers in order to ameliorate economic downturns.
When the economy begins to go soft, the Federal budget automatically
shifts toward deficit, for two reasons: First, people are losing jobs,
and because they are no longer working, they are not paying taxes into
the Treasury; therefore, the revenues into the Government decrease.
This happens automatically. We don't take any action around here for
that to happen. It just occurs. Because people are no longer working,
they are no longer earning, and those people, at least, are not paying
taxes into the Treasury.
Second, at the same time, automatically expenditures increase,
because we pay out unemployment insurance. If you have been working,
you become unemployed, you are entitled to draw unemployment insurance.
So those payments go up.
The consequence of those two things happening--and there are other
transfer payments also that go up in the course of an economic downturn
or a recession--the deficit widens. But that deficit serves to cushion
the economic downturn, because it helps to sustain purchasing power in
the economy that would otherwise go into decline. Cushioning occurs
because by providing unemployment insurance, you help to hold the
economy up and to check the downturn.

Now, that happens automatically. It doesn't require a conscious
decision. If the recession is bad, we often then go on to make
conscious decisions here about ways to try to bring the economy back.
But under normal circumstances, this cushioning is sufficient to
moderate the economic downturn.
Because we have followed this policy essentially since the end of
World War II, we have been able to check the boom-and-bust cycle of our
economy, which we had previously been experiencing. Of course, that is
a very good thing, because you don't put your economy and your people
through the absolute wringer of a major economic downturn.
The fact of the matter is, as the economy goes soft, you begin to run
these deficits. If you try to offset the deficit, either by cutting
spending or raising taxes or a combination of the two, in an economic
downturn, you would only drive the economy further down. The economy,
the business cycle is swinging downwards, and if you compound that
swing by a policy of trying to eliminate the deficits which arise from
that downturn, you only make the downturn worse, and we have
experienced that in our history, during the Great Depression.
This is why these automatic stabilizers are so important, and this is
why, in many respects, this amendment is so dangerous.
This chart beside me measures real economic growth from 1870 to 1995,
and it shows the ups and downs in economic growth in our economy,
beginning in 1870 and running through until 1995. The essential thing
the chart shows is that since World War II, we have essentially been
able to avoid deep economic recessions or, indeed, depressions.
One of the reasons--not the only reason, but one of the reasons--we
have been able to do that is because we have had these automatic
economic stabilizers which have kept the economy from coming down into
deep negative growth. Only a couple of times have we actually had a
downturn that took us into negative growth. Most of the time we get
movements, they remain in the

[[Page S1186]]

positive level, and, as you can see, we have not in recent history
experienced the kinds of deep moves we experienced pre-World War II.
That is why the Secretary of the Treasury, Secretary Rubin, in
testimony before the Judiciary Committee about this amendment to the
Constitution, said he was fearful that what it would do is turn an
economic downturn into a recession and a recession into a depression.
Amendment supporters say, ``Well, if that happens, we'll get a
supermajority around here, we will waive the provisions of the
Constitution, and we will take action.''
There are a number of difficulties with that response. First of all,
the automatic stabilizers work automatically. No one has to recognize
there is an economic downturn. Often, we don't see an economic downturn
is happening until much later, until it is well into its cycle.
Only a few years ago, Alan Greenspan thought the economy was doing
well and said so. Later, it turned out that at the moment he said that,
the economy was already into a downturn, but it wasn't recognized, it
wasn't seen. Later, when all the figures came in, we went back and saw
that we had already gone into a downturn. This amendment is going to
cost us these automatic fiscal stabilizers that operate without the
need for congressional action, and that cushion a recession that we
might not even know to exist.
Second, we have a lot of arguments around here about whether we have
a downturn, how serious a downturn is, how you have to respond to it.
Franklin Raines, the Director of OMB pointed out the other day before
the Budget Committee that a lot of our difficulties are regional
depressions, not national depressions. Much of the country might be
doing all right, but a region of the country may be in severe trouble
and needs help in order to address the situation in which to find
itself.
Of course, then it is going to be extremely difficult to get a
supermajority because most communities will not be experiencing a
recession or downturn and their representatives will not want to waive
this provision.
I can remember during the administration of President Bush when we
tried to act on extending the unemployment insurance. It took us
months, months, months, and months before we were able to do it. And
all the time the economic downturn was getting worse. As a consequence,
all the time we were falling further and further behind the curve.
The fact of the matter is, is that the earlier you can act, and
particularly if you can act automatically, through stabilizers, the
quicker you can check the downturn. If the downturn gains momentum,
begins to build up steam in that direction, the amount of corrective
action that has to be taken in order to turn it around is much greater.
The prudent thing is to act early on, because then you do not suffer as
much damage because you do not go as deep into the decline.
But this balanced budget amendment is a virtual guarantee that that
kind of early action will not be taken and that we will always be
playing catch up with the economic cycle.
The many distinguished economists who have spoken out, and to whom my
very able colleague from California has made reference, have focused,
amongst other things, on this aspect of the situation. We ought not to
give away lightly the benefits that have come to us by developing
effective fiscal policy to help restrain the movements of the business
cycle. We have not eliminated it. I assume my colleagues who are
pushing this amendment do not for a moment suggest they somehow have
figured out a magical way to eliminate the business cycle. But we have
developed policies that have ameliorated the business cycle.
I do not want to go back to these deep declines in the economy. We
ought not to be in the situation where, as in the 1930's, we would rue
the day that we denied ourselves the capacity to respond to that kind
of an emergency so that we actually had to experience something
approximating economic devastation before we were prepared to take
action.
Why would you do that? Why would you want to do that? Is the economy
not working well? Let us look at that issue for just a moment.
The unemployment rate today is 5.4 percent. It has been down in the
low range of 5 percent now for many months. It is a very good
performance. The last time we had a performance anything like that over
a sustained period of time was 20 years ago.
What about the inflation rate? The inflation rate is under 3 percent.
It has been there now for the last 4 or 5 years--about or under 3
percent. The last time we had a performance on the inflation front that
was that good was 30 years ago.
So we are doing very well on unemployment and inflation.
We have created 11.5 million jobs over the last 4 years. Other
countries envy us in terms of what we are doing. But, amendment
proponents say, we still have a problem with the deficit? What about
the deficit? Let us take a look at the deficit.
Are we making any progress on reducing the deficit? Can someone
contend that we are not making any progress on the deficit-reduction
front and, therefore, we need a constitutional amendment, as risky and
as radical as it might be, in order somehow, some way to compel some
kind of action? We should note, however, that the amendment does not
curb the deficit at all? You are still going to have to make the budget
decisions with respect to the budget--your spending and tax decisions
with respect to the budget. Have we been doing that already?
In 1992, the deficit, in current dollars, was $290 billion. Since
then, we brought the deficit down in each of the succeeding 4 years.
The deficit now is $107 billion. And the President has submitted a
budget plan that will eliminate the deficit by the year 2002.
Some have criticisms of that plan. Others praise it. I think it is a
pretty good plan but it is not written in stone and it is up to the
Congress to deal with it now in consultation with the administration.
But in any event, there is a plan to bring it down and eliminate the
deficit by the year 2002.
I think the President has pretty good credibility in putting forward
this plan on the basis of his record.
We ran large deficits in the 1980's and into the early 1990's. It was
not just the administration that did that, the Congress was complicit
in it as well. After all, you do not get a budget unless we in Congress
pass it. Although I do want to point out that through those 12 years,
in all but 1 year the budget passed by the Congress had a lower deficit
figure than the budgets submitted to the Congress by the
administration.
In other words, in every year but one the Congress was able to do a
tighter budget than what the administration had submitted to the
Congress. Had we passed the administration's submitted budgets, as
proposed to us, the deficits would have been larger, not smaller. We
did not increase the deficits. We in fact lowered the deficits.
But now in the last 4 years we have made this very impressive
progress and we are on the path to a balanced budget. The way you make
this progress is you make decisions on the budget each year. None of
this progress was made because there was an amendment in the
Constitution. And if you put an amendment in the Constitution, the
progress still will not be made.
The progress can only be made when you vote the budgets, when you
make the spending and the tax decisions that are contained within the
budget, the consequences of which then give you your deficits or your
balance. That is when you make the decisions. And we have been making
hard decisions, particularly the 1993 economic plan, which passed this
body on the tiebreaking vote of the Vice President.
A lot of people criticized that plan. People said ``Oh, this is going
to have devastating consequences on the economy.'' It was a combination
of spending cuts and some tax changes. But what it produced was a
reduced deficit and an economy that has worked exceedingly well over
the last 4 years, an economy that other countries look at with a great
deal of envy.
These are the absolute figures on reducing the deficit. Let us look
at the measure of the deficit as a percent of the gross national
product, which is a very important measure. It enables us to compare
with our own performance over time and with other countries. Because as
you strengthen your economy, you can bring your deficit down and it

[[Page S1187]]

becomes a smaller percentage of the GDP and becomes easier to handle.
It is like an individual's situation. If he has more income, he is
better able to handle the deficit. If his economic strength grows more
rapidly than the deficit he is trying to handle, then he gets stronger
and more able to pay off the debt.
Let us look at that. This is what has happened. In 1992, the deficit
was 4.9 percent of GDP. That is not a good figure. I am prepared to
state that right at the outset. The European Community now, which is
trying to move toward monetary union, has established some benchmarks
which it is pressing the 15 members of Europe to abide by in order to
achieve the monetary union. And one of them is that deficit, as a
percent of GDP, be under 3 percent--under 3 percent. That is the
benchmark they have set out.
In 1992 we were at 4.9 percent. As this chart beside me shows, we
brought down our deficit as a percentage of GDP to 4.1 percent in 1993,
3.1 percent in 1994, 2.3 percent in 1995, and 1.4 percent in 1996. That
is the best performance since 1973, 23 years ago. It is a better
performance than all but 3 of the 15 members of the European Union,
three of the smaller countries--Luxembourg, Denmark, and Ireland. Our
projections out into the future are very positive; according to these
projections, we will do even better than 1.4 percent in the future.

So we are making very significant progress toward a balanced budget.
We really are on the right track. The real place we ought to be
focusing on is on the budget process and the decisions that will be
made with respect to spending programs, tax programs, tax subsidies,
tax expenditure issues, and so forth.
Further, our performance of 1.4 percent deficit as a percent of GDP
is better than any of the G7 countries, the major industrial countries
in the world.
I was at a Joint Economic Committee hearing this afternoon where
Chairman Stiglitz of the Council of Economic Advisers was presenting
the economic report of the President. He talked about how nice it was
now to go to international meetings with the performance of our economy
and be able to hold out as an example to other countries what we are
doing.
Look at this chart beside, which compares the deficit as a share of
GDP for each of the G7 nations. Here is the United States, down to 1.4
percent. We have a game plan now, by the year 2002 to close that out
completely. Now, I know we will have arguments here about the game
plan, but I think it is credible. It could be changed, it could be
different. I think it is credible. I think it represents a bona fide
effort to close this out.
Look at this comparison: Here is Japan with 3.1 percent deficit,
Germany, 3.5 percent; Canada, 4.2 percent; France, 5.0 percent; the
United Kingdom, 5.1 percent. Italy is 7.2 percent. If you make the
comparisons, if you do a vertical comparison over our history, we have
the best performance now, deficit as a share of GDP, since 1973. That
is how we stack up in terms of our past record. If you do a horizontal
comparison with other countries around the world, this is how we stack
up. Any way you look at that, that is a pretty good performance.
Now, let me finally address one other point about this amendment. I
want to address this assumption here that you can simply get these
supermajorities almost by the wave of the hand if you have any kind of
serious problem confronting you. Now there are two kinds of
supermajorities required in this proposed resolution, Senate Joint
Resolution 1--either a majority of the total membership of the body or
three-fifths of the total membership of the body, what they call the
whole number of the House. Now, what the ``majority of the whole''
requirement means is in the Senate you would have to have 51 votes--
although there is some argument, legally, about the role of the Vice
President's vote in this process, an interesting debate that shows you
the complexity of this proposal and its potential for complications.
That question has never been resolved. Then there is the three-fifths
supermajority requirement, which of course in this body would be 60
votes.
I want to make historical reference to one critical vote in the
House, which in a historical sense we can look at and say, ``Well, that
was a critical vote in the history of this country. That was really a
national crisis, and clearly Members should have recognized it and
should have acted accordingly. That is the kind of situation which, if
it arises again, we certainly would be able to get these
supermajorities provided for in this Senate Joint Resolution 1.'' In
1940 the U.S. Congress, on the urgings of President Roosevelt, provided
for a draft for 1 year, because President Roosevelt saw the war clouds
that were gathering in Europe and felt the United States needed to
undertake preparation for what might be coming. A year later, of course
the issue arose, since it was only for a year, about extending the
draft. We are now talking about the fall of 1941, only shortly before
Pearl Harbor. The President asked the Congress to extend the draft so
that we could continue this program of military preparedness because
the war clouds were even darker and more ominous.

The issue was so close in the House of Representatives that Speaker
Rayburn, exercising a very rare prerogative of the Speaker, took the
floor of the House at the close of the debate to urge extension of the
draft. The vote on that issue in the House was 203 to 202, so under the
Constitution it carried. You had a quorum present, had a majority of
those voting, carrying it 203 to 202. Mr. President, 203 is--and was
not then--a majority of the whole number of the House of
Representatives, which would be 218 today, and it is certainly not
three-fifths of the whole number of the House. These are the two
supermajorities required in this resolution.
Now, there you were with a crisis situation which certainly, looking
back at it historically, you would have said, ``Well, obviously, those
Members of Congress will recognize what the country is confronting and
vote to carry this forward.'' They barely did it. They cast a vote that
would not have worked under the supermajority requirements contained in
Senate Joint Resolution 1.
I think those who say of course we will achieve supermajorities are
being much too sanguine. The amendment says that the debt limit shall
not be increased without three-fifths of the whole number. We can
hardly put together simple majorities in Democratic or Republican
administrations to achieve this goal. I have voted in this body to lift
the debt ceiling in Republican administrations at the request of
Republican Presidents and Republican Secretaries of the Treasury
because I felt obviously we had to do that. We could not put the credit
of the United States at risk. But those votes have been exceedingly
close and they have not come anywhere near meeting the supermajority
requirements contained in this Senate Joint Resolution 1. No wonder the
Secretary of the Treasury has voiced his apprehension that we might
risk a default on the debt and hurt the creditworthiness of the United
States through the passage of this amendment to the Constitution.
Mr. President, I urge my colleagues to think long and hard about this
amendment. It is a very radical proposal. It has a lot of surface
appeal, as my colleague from California pointed out when she quoted the
editorial in the Los Angeles Times. The easy vote is obviously to be
for it, as most people upon hearing it say it is a good idea. You
really have to go into it and examine it very carefully and appreciate
the real way you bring the deficit down is to make the budget
decisions, not to amend the Constitution of the United States.
I yield the floor and I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The bill clerk proceeded to call the roll.
Mr. NICKLES. Mr. President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.

____________________