[Pages S5023-S5066]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

CONCURRENT RESOLUTION ON THE BUDGET

The PRESIDING OFFICER. The Senate will now resume consideration of
Senate concurrent resolution, which the clerk will report.
The legislative clerk read as follows:

A concurrent resolution (S. Con. Res. 27) setting forth the
congressional budget for

[[Page S5024]]

the United States Government for fiscal years 1998, 1999,
2000, and 2001.

The Senate resumed consideration of the concurrent resolution.

Pending:
Kerry amendment No. 309, to allocate funds for early
childhood development programs for children ages zero to six.
Dorgan amendment No. 310, to express the sense of the
Senate that the Congress should continue efforts to reduce
the on-budget deficit without counting Social Security
surpluses.
Wellstone modified amendment No. 313, to provide for
increases in funding for Headstart and Earlystart, child
nutrition programs, and school construction, which will be
paid for by reducing tax benefits to the top 2 percent of
income earners in the United States as well as by reducing
tax benefits that are characterized as corporate welfare or
tax loopholes.
Wellstone amendment No. 314, to provide that Pell Grants
for needy students should be increased.
Abraham amendment No. 316, to express the sense of the
Senate that, to the extent that future revenues exceed the
revenue aggregates, those additional revenues should be
reserved for deficit reduction and tax cuts only.
Gramm amendment No. 319, to ensure that the discretionary
limits provided in the budget resolution shall apply in all
years.
McCain-Hollings amendment No. 326, to express the sense of
the Senate that the Congress shall take such steps as
necessary to reconcile the difference between actual revenues
raised and estimates made and shall reduce spending
accordingly if Spectrum Auctions raise less revenue than
projected.
McCain-Mack amendment No. 327, to express the sense of the
Senate with respect to certain highway demonstration
projects.
Lautenberg (for Moseley-Braun) amendment No. 333, to
express the sense of the Senate regarding the use of budget
savings.
Lautenberg (for Moseley-Braun) amendment No. 334, to
express the sense of the Senate regarding the value of the
Social Security system for future retirees.
Specter amendment No. 338, to provide for a reduction in
mandatory spending and an increase in discretionary spending
relating to children's health.
Specter amendment No. 339, to provide for a reduction in
mandatory spending and an increase in discretionary spending
relating to children's health.
Specter amendment No. 340, to restore funding within the
discretionary health function to maintain progress in medical
research, offset by reductions in Federal agency
administrative costs.
Domenici (for Grams) amendment No. 346, to require that the
$225 billion CBO revenue receipt windfall be used for deficit
reduction and tax relief, and that non-defense discretionary
spending be kept at a freeze baseline level.
Domenici (for Coverdell) amendment No. 347, to provide for
parental involvement in prevention of drug use by children.
Domenici (for Snowe-Coverdell) amendment No. 349, to
express the sense of the Senate relative to higher education
tax relief and higher education expenses.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Madam President, would the Senator from Arizona yield
for one moment? There are 11 first-degree amendments, 1 motion to waive
a point of order, and possible second-degree amendments and final
passage votes that could occur today. If everybody asks for a vote,
that means we could have 15 votes, Senator McCain. At an average of 15
minutes a vote, even though we said 10, it would be at least 4 hours of
voting.
I think we can do better. I think at least half of these amendments
can be voice-voted, cutting the 4 hours to 2. We will try our best to
see if the proponents will accept voice votes. I hope we can encourage
Senators not to demand a vote.
I thank Senator McCain, who I am just told will take a voice vote on
amendment No. 327. During this first vote, staff will try to determine
which ones can be voice-voted.
I yield the floor to Senator McCain.
The PRESIDING OFFICER. The Senator from Arizona is recognized.

Amendment No. 326

Mr. McCAIN. I call up amendment No. 326, which is at the desk.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Arizona [Mr. McCain], for himself and Mr.
Hollings, proposes an amendment numbered 326.

(The text of the amendment is printed in the Record of May 21, 1997)
Mr. McCAIN. I yield 10 seconds to the Senator from Montana.
The PRESIDING OFFICER. The Senator from Montana is recognized for 10
seconds.
Mr. BURNS. Madam President, on this amendment, I am heartily
supporting this, especially because not supporting the amendment would
be irrational, knowing that the blueprint is in front of us that
spectrum does not have the value that is put into this bill. So, if we
have a track record that proves that it does not, it is outrageous that
we would accept the figures in this budget.
The PRESIDING OFFICER. The Senator from Arizona.
Mr. McCAIN. Madam President, it is important, as the Senator from
Montana said, that we be on record on this issue because there are
three pertinent facts that we cannot forget here. Over $26 billion is
assumed to be raised from the spectrum auction in the budget. Both the
ranking member of the Commerce Committee, Senator Hollings, and myself
seriously question whether raising that much money is possible.
Unlike fees or taxes, as we all know, spectrum auctions are a
function of the free market, and its value is determined solely by
supply and demand. Due to the volatility of this market, as we have
seen recently, it is virtually impossible to accurately know what
spectrum is worth and, since it is planned to be auctioned 5 years from
now, what it will be worth. Even the expert agencies, CBO and FCC, have
not been able to accurately gauge spectrum value.
I understand the task of the budgeteers here on this issue, but it is
very, very questionable, these figures.
This amendment has been offered by both myself and my good friend,
the ranking member and former chairman of the Commerce Committee, Mr.
Hollings. Simply, this amendment expresses the sense of the Senate that
if the estimates regarding spectrum auctions contained in this
resolution prove not be accurate that spending will be adjusted
accordingly.
The budget agreement before the Senate relies heavily on spectrum
revenues, particularly spectrum auctions, to reduce the deficit and
achieve balance by the year 2002. If this resolution passes as
currently drafted, the Commerce Committee will be asked to raise
between $26 to $28 billion. With the exception of some ancillary fees,
the bulk of what the Commerce Committee will be asked to raise is
assumed to come from spectrum.
Of the total $26.3 billion in estimated spectrum revenues, about 95
percent, or $24.3 billion, would be derived specifically from spectrum
auctions.
The problem is this: experience demonstrates that it's very difficult
to reliably estimate what a given block of spectrum is likely to bring
at auction. And therefore, as the chairman of the Commerce Committee, I
am very concerned that the assumptions contained in the budget
resolution will not actually raise the money needed.
In a letter to me last February 26, FCC Chairman Reed Hundt, a
staunch proponent of spectrum auctions, said this about predicting
spectrum auction values:

Determining the value of spectrum in advance of an auction
is very difficult, and not something the Commission
ordinarily does.
One of the benefits of the auction is that the value of
spectrum is not determined by government, but by a
marketplace in which businesses have actual plans to develop
and use spectrum. The value of any block of spectrum in the
market thus depends on a number of factors, [including] the
location of the spectrum, its technical characteristics, the
amount of spectrum to be assigned with each license, the
availability of technology suitable for a given band, the
amount of spectrum already available for provision of similar
services, the number of incumbents presently occupying the
spectrum, and whether incumbents will remain licensed in that
spectrum or will be relocated to other spectrum.
Not surprisingly, therefore, auction estimates have been inaccurate
on both the high side, as well as the low side, ever since the FCC was
given spectrum auction authority in the Omnibus Budget Reconciliation
Act of 1993.
For example, the very first estimates of the revenue spectrum
auctions would generate were very low. At that time Congress predicted
that spectrum auctions would generate approximately $10 billion over 5
years. The actual amount generated was over $22 billion in 3 years.
Similarly, the auction of digital broadcast satellite spectrum was
estimated to raise less than $40 million. That auction raised $683
million.
Other spectrum auction estimates, however, have been very high. The
recent auction of wireless communications spectrum, which we estimated
in

[[Page S5025]]

August of 1996 would generate $3 billion, raised only $14 million.
All these estimates were based on information provided by a cross-
section of experts, including telecom providers, the financial
community, and the FCC and NTIA--the expert agencies in this area. I
don't fault their expertise, nor am I suggesting that spectrum isn't a
valuable commodity and shouldn't be auctioned. To the contrary, it is
an extremely valuable natural resource, owned by the public, and
allocation should occur by auction.
What I am saying, however, is that just because auctions assign
spectrum efficiently to its most valued use does not mean that they can
be guaranteed to produce a certain dollar figure. They are not, and
were never intended to be, the functional equivalent of cash machines.
They function as a component of the free market and therefore are
subject to great highs and lows.
As Chairman Hundt recognizes, it is impossible, even for experts, to
reliably predict the value that a given block of spectrum is likely to
bring at auction. Despite this fact, however, this budget places
substantial reliance on these inherently unreliable predictions of
spectrum auction revenues to balance the budget.
Here are my specific concerns with the spectrum auction budget
assumptions:
First, revenues from auctioning 100 MHz of spectrum formerly used by
broadcasters for electronic news gathering are estimated to total $9.7
billion between 1998 and 2002. This estimate is based on the spectrum
being roughly comparable in potential usefulness to the lucrative PCS
spectrum. Now, however, FCC and NTIA say that this spectrum is not
comparable to PCS spectrum because it's already occupied and not
suitable for a wide range of potential uses. Thus, a critical element
in estimating the spectrum's $9.7 billion value is not accurate.

Second, another $6 billion is estimated to come from the auction of
spectrum left over from the reallocation ordered in 1993, plus the
auction of new spectrum at now-available higher frequencies. The
problems here are that the leftover 1993 spectrum, standing alone,
isn't expected to generate all that much, and nobody yet knows
precisely what the new high-frequency spectrum is usable for. Thus,
what anybody might realistically be expected to bid for it is, at best,
a guess. Technology may prove us wrong. But no companies, based on
current technology--are clambering for this spectrum.
Third, $5.4 billion more is estimated to come from the auction of
analog broadcast channels in the year 2002--even though most of these
channels won't even be available for use until 2006. That's tantamount
to speculating in spectrum futures.
Moreover, given the broadcasters' vehement objections to being
required to give the channels back by 2006 or any other date, we simply
cannot be sure when--if ever--these channels will actually be freed up.
As Chairman Hundt correctly noted in his February 26 letter,

When incumbent licensees are present, these licensees often
have incentives to oppose the use of auctions to assign
licenses in that band.

Thus, the value to bidders of essentially nonexistent channels has
got to be seriously questioned.
Fourth, even the projections surrounding the comparatively modest
$700 million estimated to come from auctioning so-called 888 telephone
numbers are flawed. The $700 million estimate was made before these
numbers began being handed out for free some time ago. Based on the
quantity of numbers left to auction now, however, the probable revenue
would be perhaps half the original $700 million estimate.
Fifth, the impact of these potentially flawed estimates is made worse
by the large proportion of spectrum auction revenues that this budget
scores in 2001 and 2002. Altogether 70 percent of the total spectrum
auction revenues are called for to be generated during these 2 years.
However, it is during these outyears that the most spectrum can be
expected to be on the market, and the more spectrum you put on the
market, the less you are likely to get for it--simple supply and
demand.

Finally, there's also a potential problem with the $2 billion lump
sum tied to broadcasters' use of their digital TV channels for non-HDTV
uses. This $2 billion represents about a 7-percent hit on the $30
billion television broadcast industry. I am not one to protect the
broadcast industry, but I am concerned about this fee. In the past,
Senator Dole and I had advocated auctioning the digital spectrum before
it was given to the broadcasters. That auction alone is estimated to
have raised between $20 to $70 billion. However, we were unsuccessful
and that spectrum was given free of charge to the broadcasters.
Madam President, balancing the budget is critically important to the
future of our country's economy, and spectrum auction revenues have
been made critically important to balancing the budget. We must
therefore be extremely concerned about the considerable uncertainty
inherent in accurately predicting the amount of money spectrum auctions
will generate, and we must have an insurance policy against the very
real likelihood that these estimates will turn out to be too high.
Madam President, I hope this amendment will pass. Voting for it does
not mean that Senators oppose the budget resolution itself. However,
supporting this amendment does recognize that the auction numbers
assumed in this resolution are subject may not produce the revenue
noted and that therefore, the Congress may need to act on this matter
in the future.
Mr. HOLLINGS. Madam President, I rise in support of the sense-of-the-
Senate resolution. The resolution points out the unreliability of the
budget resolution's assumptions about future spectrum auctions. At
issue here is the credibility of the entire budget itself. The budget
assumes $26.3 billion from spectrum auctions by the year 2002. Such
assumptions are not supported by the record. The only explanation is
that the Budget Committee and the administration have crafted these
assumptions out of thin air.
We are told by CBO that our budget problems can be solved by
auctioning the spectrum. People around here continue to think spectrum
is a canned good sitting on a shelf at the FCC. These budget numbers
are absolutely irresponsible and CBO knows there is no justification
for these estimations. Just look at the most recent auction that was
held last month. Last fall, the budget negotiators fell short in their
offsets and decided to auction a specific 30 MHz of spectrum. CBO told
us the auction would yield $2.9 billion. The auction only yielded $13.1
million. Is this how you balance a budget?
I must remind the budget negotiators that the law requires the FCC to
assign licenses to use the spectrum by auction and that the assignments
shall not be based on revenue considerations. Every time the Congress
mandates an auction as a budget offset we are violating our own law.
And every time we mandate a specific frequency to be auctioned, we are
micromanaging in an area we have no expertise in. The spectrum simply
is not a canned good sitting on a shelf. Management of the public's
spectrum should not be determined on budget numbers.
Just look at the status of the market for start-up wireless
companies. Wall Street is saying there is a glut in the marketplace.
There is no financing available for the recent ``C'' block licensees.
How can CBO possibly justify $26.3 billion when you look at the April
auction in combination with the problems in the ``C'' block?
The FCC recently suspended the interest payments for several of the
``C'' block licensees because they were unable to meet their
obligations to the Treasury. How can CBO justify $26.3 billion when
``C'' block licensees are going into bankruptcy and being bailed out by
the FCC. The Treasury is not receiving any moneys from these auctions.
Even the licensees, such as Nextwave, that violated the law are not
being required to make payments. This is a complete disregard for the
law. This is nothing more than an effort to prop up this charade that
auctions are good.

Look at the case of Nextwave. This company bid several billions of
dollars for licenses nationwide. When it came time to file complete
documentation of their financial backing, the FCC found that this
company was in violation of the foreign ownership limits of the
Communications Act. To its credit, the

[[Page S5026]]

FCC issued an order requiring Nextwave to divest itself of certain
foreign financial commitments and come into compliance with the law.
Now, several months later, Wall Street is still showing no confidence
in these wireless ventures, so Nextwave has been unable to raise any
capital.
So, what does the FCC do? The FCC could not afford another
embarrassment on the heels of the April fiasco. So the FCC simply waves
its previous order and says, don't worry Nextwave, you are in violation
of the law but there are more important issues involved here--we must
continue the charade that the auctions are working. How can an agency
of this Government be so cavalier in its execution of the law is beyond
me. Clearly, it pays to be perceived as being too big a player that the
FCC cannot let the company go under.
Tell that to Rocky Mountain Solutions and Carolina PCS. Where was the
FCC's consistency in applying the law here? Rocky Mountain Solutions
and Carolina PCS had difficulty in raising capital just as the other
licensees. Were they in violation of the foreign ownership limits of
the law. The answer is ``no.'' Were they a small company and not
perceived as a big player? The answer is ``yes.'' Where's the
consistency? The FCC held to a strict interpretation of their own
auction rules--there was no statutory violation--in denying Rocky
Mountain Solutions and Carolina PCS request for more time. When a large
company violates the law, there is always a creative interpretation of
the law in order to keep up the charade.
How can we have any confidence in the results of these auctions? News
reports also indicate that the Department of Justice is investigating
collusion and illegal bidding practices in some of the auctions.
Obviously, some of the potential bidders think the auctions can be
fixed as easily as the budget assumptions.
The Treasury is not going to get the money CBO had projected. The
budget cannot be balanced in this way. Why does the Budget Committee
and CBO continue to keep their heads stuck in the sand. How can CBO
justify not $26.3 billion in light of these recent events? The auctions
are not the solution the rhetoric holds them out to be. Clearly the
Budget Committee and CBO must have budget blinders on. Their denial of
these recent events is further evidence that there is no integrity to
these numbers.

Just look at a breakdown of the budget assumptions and the problems
with each item.
Auction of the returned analog spectrum: The budget proposal requires
an auction of 78 MHz of analog spectrum in 2002 with a mandatory return
of the analog spectrum in 2006. CBO scores the analog auction at $5.4
billion. There are many practical problems involved here. First, will
there really be an interest in this auction when the winning bidders
will not have access to the spectrum for at least 4 years? What about
possible delays that may occur from zoning ordinances and tower
construction problems? In addition, there remains the question of
whether there will be widespread demand for digital TV.
Auction of 36 MHz of spectrum from CH.60-69: This spectrum was
originally set aside for the transition to HDTV. No one knows if the
FCC plan will actually work. All we have if a computer model from the
FCC. All indications are that the FCC'S table of allocations will be
challenged at the FCC and possibly in the courts. The budget deal will
enshrine the FCC'S plan before we know its implications and possibly
foreclose revisions to the FCC'S plan. Such a result would be
unacceptably shortsighted. It is highly unlikely this proposal will
result in a free and clear nationwide block of spectrum by 2002.
Spectrum penalty: The Budget Committee Assumes $2 billion from a
penalty fee that would be levied against those entities who received
``free'' spectrum for advanced, advertiser-based television services,
but failed to utilize it fully. This is the most incredulous proposal
of all. The Telecommunications Act of 1996 authorized the FCC to assess
fees on a broadcaster's flexible use of the spectrum--if the
broadcaster elects to offer additional services in addition to its free
over-the-air programming. CBO staff has no basis to score this
provision. There is no evidence in the record to assume the
broadcasters will be capable of offering a subscription-based service
by 2002.
Auction of additional 120 MHz: CBO assumes $9.7 billion but where's
the spectrum coming from? How can they justify it when the recent
auction raised only $13 million when CBO had scored it at $2.9 billion?
Auction 800 and 888 numbers: Here's a small business tax if you ever
saw one. The administration's proposal is simply unrealistic. Large
companies will simply outbid all the small players and warehouse
popular numbers. Furthermore, the FCC does not have sole jurisdiction
of toll free numbers. The United States participates with Canada in the
North American numbering plan.
Mr. REID. Madam President, there are going to be high priority
projects in the transportation bill that passes the Congress this year.
As long as there has been a U.S. House of Representatives, there have
always been demonstration projects. The House is showing no signs of
giving them up this year.
There is no chance that the House will pass a transportation bill
without earmarks for individual Members' projects.
Given that knowledge, do we, as the Members of the Senate, really
want to unilaterally disarm? If there are going to be demonstration
projects, are we merely going to defer to the House?
Rather than slipping projects into the final bill during the
conference, wouldn't it be better to have an open discussion of the
relative merits of these projects in committee than on the floor?
At least give the House credit for having a process. The House
committee of jurisdiction required that a 14-point check list be filled
out for each demonstration project this year. Only a very few projects
from that list will be selected for funding.
If the original ISTEA legislation is an indication, well under 10
percent of the final dollar amount will be earmarked for demonstration
projects. The original ISTEA bill provided $6.5 billion for
demonstration projects out of a total authorization of $155 billion.
I dispute the Senator's notion that all demonstration projects are
merely glorified pork. In my home State of Nevada, one of the fastest
growing areas in the Nation, we have used earmarks to keep up with the
explosion in transportation needs.
The I-15/U.S. 95 Spaghetti Bowl Interchange in Las Vegas, one of the
busiest interchanges in one of the fastest growing cities in the United
States was built with earmarked funding far more quickly than if it
needed to go through a traditional funding process.
Nevada's capital, Carson City, remains one of a handful of State
capitals in the United States that is not linked to the Interstate
System. An earmark in the original ISTEA funded the first leg of this
critical link.
Mr. McCain. Madam President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
Mr. DOMENICI. Madam President, I have a minute to respond. I don't
think I will use that. But I want to ask Senator McCain, in the
interest of helping us with the management here, could we now set this
amendment aside and do his amendment we are going to accept?
Mr. McCAIN. Yes, sir.
Mr. DOMENICI. Madam President, I ask consent the pending McCain
amendment be temporary set aside so Senator McCain can offer his second
amendment, which will be determined by a voice vote.
The PRESIDING OFFICER. It is so ordered.

Amendment No. 327

Mr. McCAIN. Madam President, I ask to call up amendment No. 327.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Arizona [Mr. McCain], for himself and Mr.
Mack, proposes an amendment numbered 327.

(The text of the amendment is printed in the Record of May 21, 1997.)
Mr. McCAIN. Madam President, the amendment is very simple. It just
says we will not have highway demonstration projects. The Senate is on
record. I wanted to get the Senate on record again, and I will before
we take up ISTEA. We have seen this very unseemly situation over in the
other

[[Page S5027]]

body, where tens of billions of dollars are special projects called
highway demonstration projects, which are really only gauged by the
influence of the Members of Congress as opposed to merit. I am very
pleased that this body is opposed to highway demonstration projects,
and I want the Senate on record as reflecting that deal.
The amendment I offer today is cosponsored by Senator Mack. My
resolution states that Congress should not divert limited highway trust
fund resources away from State transportation priorities by authorizing
new highway projects and Congress should not authorize any new
demonstration projects or other similarly-titled projects.
Its a simple proposal, embodying a principle endorsed by three-
quarters of the Senate less than 2 years ago. The principle is
elementary, fair, and sound. The principle is--No new highway
demonstration projects.
Why is this amendment necessary? It is necessary because the largest
domestic public works program, the Intermodal Surface Transportation
and Efficiency Act [ISTEA], must be reauthorized this year. As my
colleagues know, the lion's share of Federal highway and transit
funding comes under the ISTEA umbrella. Through a Byzantine set of
formula calculations, Federal gas taxes are collected by our States,
sent into Federal coffers, and then are redistributed to the States.
Some of us question the necessity of requiring State-collected gas
taxes to be sent to Washington. I am one of those individuals. But that
is an issue for another debate. Today, I want to focus on a clear abuse
in the current highway funding distribution process.
ISTEA funds are governed by a statutory distribution formula with a
few limited exceptions. One major exception is funding for highway
demonstration projects. It is this exception my amendment seeks to
eliminate. This exception is neither necessary nor fair.
What has been said about highway demonstration projects? Let me
highlight a few comments.
Secretary of Transportation, Rodney Slater, had this to say during
his confirmation hearing before the Senate Committee on Commerce,
Science, and Transportation in February:

The administration has taken a firm position in opposition
to demonstration projects * * * [they] take resources from
the [highway] trust fund.

He further remarked that ending highway demonstration projects would
``result in greater investment of resources * * * for general
distribution based on formula.''
Let me reiterate. The highway allocation process is policy driven.
But as the Secretary said, highway demonstration projects are not. The
Congressional Research Service [CRS] states:

The demonstration project approach is often constituent-
driven and focuses on increasing Federal outlays allocated to
a particular State or district * * * When earmarking occurs,
allocation stems less from concerns over marginal social and
economic benefits, and more from marginal political benefit.

The Heritage Foundation is strongly against highway demonstration
projects. In its ``Balancing America's Budget, Ending the Era of Big
Government,'' the Heritage Foundation says:

Projects earmarked by Congress are classic examples of
political favoritism obtained by powerful Senators and
Representatives for public works spending in their states and
districts. Federal ``demonstration projects'' are even more
questionable . . . purely local projects funded by the
federal government cannot be justified as being in the
national interest.

These are not new sentiments--they have been voiced for years. In
fact 2 years ago, the President's budget submission called for the
cancellation of some demonstration projects stating:

Such projects have been earmarked in congressional
authorization and appropriations laws. These projects limit
the ability of the States to make choices on how to best use
limited dollars to respond to their highest priorities.

Pork-barrel highway demonstration projects were discussed in Vice
President Gore's Reinventing Government report. It states:

GAO also discovered that 10 projects--worth $31 million in
demonstration funds--were for local roads not even entitled
to receive Federal highway funding. In other words, many
highway demonstration projects are little more than Federal
pork. Looking specifically at the $1.3 billion authorized to
fund 152 projects under the 1987 Surface Transportation and
Uniform Relocation and Assistance Act, GAO found that ``most
of the projects . . . did not respond to States' and regions'
most Federal aid needs.

One might have hoped that Federal budget constraints would curb
highway pork barreling. But it has not.
In 1982, 10 demonstration projects totaling $362 million were listed
for special line-item funding in the Surface Transportation Assistance
Act of 1982. The 1982 Federal Budget deficit was $127 billion, and it
jumped to $221 billion by 1986.
In 1987, 152 demonstration projects totaling $1.4 billion were named
in the Surface Transportation and Uniform Relocation Assistance Act of
1987. The 1987 Federal budget deficit was $149 billion, but it jumped
to $269 billion in 1991.
Then in 1991, the mother lode of all demo project bills was signed
into law: 538 location-specific projects totaling $6.23 billion were
included in the Intermodal Surface Transportation Efficiency Act of
1991.
If the budget deficit has not curbed demonstration projects, maybe
fairness will.
It is 1997 and time once again to authorize funding for our Nation's
transportation infrastructure. Funding for highway, bridge, and transit
needs remain great. Congress should give States the maximum amount of
flexibility available to spend their highway dollars in whatever manner
best meets their critical transportation needs. The States do not need
Congress to micro-manage the transportation planning process. And the
traveling public certainly is not well served when Washington forces
limited funding to be spent on unnecessary road projects.
Two years ago, the Senate adopted my amendment to prohibit the
funding for future demonstration projects. That amendment was
cosponsored by Senators Feingold and Smith. It passed by a vote of 75
to 21.
We need to reaffirm Senate opposition to new demonstration projects.
There are reports that more than 400 Members in the other Chamber
submitted requests to the Committee on Transportation and
Infrastructure for highway, bridge, or transit projects. I am informed
these requests include more than 1,000 projects. These requests could
total hundreds of billions of dollars, hundreds of billions of dollars
that would be siphoned away from formula-driven allocations, and poured
into individually designated State or local projects.
Past highway demonstration projects took almost $8 billion away from
formula-driven allocations to the States. While we can't recapture this
$8 billion, we can end the practice. My amendment states that
``Congress should not divert limited highway trust fund resources away
from State transportation priorities by authorizing new highway
projects and Congress should not authorize any new demonstration
projects or other similarly titled projects.''
Mr. President, most Senators want to raise the amount of highway
funding for our States and to assure an equitable distribution of that
funding. One way to provide more money is to end the practice of
designating highway demonstration projects or innovative projects, or
any other creative description of pork-barrel projects.
I urge my colleagues to support my amendment.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Madam President, this sense-of-the-Senate amendment
provides the Senate shall not authorize any new highway demonstration
projects during the reauthorization of the Intermodal Surface
Transportation Efficiency Act.
We have no objection to the amendment. We are willing to accept it.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. LAUTENBERG. Madam President, I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. DOMENICI. Madam President, I ask unanimous consent that the order
for the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DOMENICI. Madam President, we tried to expedite things and it

[[Page S5028]]

turned out we did not. What I would like to do now is ask unanimous
consent that we return to the first McCain amendment on which the yeas
and nays have been ordered, and that immediately thereafter we return
to the second McCain amendment. We will have further discussion on that
during the vote.
The PRESIDING OFFICER. Without objection, it is so ordered.

Vote On Amendment No. 326

The PRESIDING OFFICER. The question occurs on amendment No. 326,
offered by the Senator from Arizona.
The yeas and nays have been ordered. The clerk will call the roll.
The assistant legislative clerk called the roll.
Mr. FORD. I announce that the Senator from North Dakota [Mr. Dorgan]
is necessarily absent.
The PRESIDING OFFICER. (Ms. Collins). Are there any other Senators in
the Chamber who desire to vote?
The result was announced, yeas 84, nays 15, as follows:

[Rollcall Vote No. 86 Leg.]

YEAS--84

Abraham
Akaka
Allard
Ashcroft
Baucus
Bennett
Biden
Bingaman
Bond
Breaux
Brownback
Bryan
Burns
Campbell
Chafee
Coats
Cochran
Collins
Conrad
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Enzi
Faircloth
Feingold
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Gramm
Grams
Grassley
Gregg
Hagel
Helms
Hollings
Hutchinson
Hutchison
Inhofe
Inouye
Jeffords
Kempthorne
Kennedy
Kerrey
Kohl
Kyl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lott
Lugar
Mack
McCain
McConnell
Mikulski
Moseley-Braun
Moynihan
Murkowski
Nickles
Reid
Robb
Roberts
Roth
Santorum
Sessions
Shelby
Smith (NH)
Smith (OR)
Snowe
Specter
Stevens
Thomas
Thompson
Thurmond
Warner
Wyden

NAYS--15

Boxer
Bumpers
Byrd
Cleland
Durbin
Harkin
Hatch
Johnson
Kerry
Murray
Reed
Rockefeller
Sarbanes
Torricelli
Wellstone

NOT VOTING--1

Dorgan

The amendment (No. 326) was agreed to.
Mr. DOMENICI. I move to reconsider the vote.
Mr. LAUTENBERG. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from New Mexico.

Amendment No. 327

Mr. DOMENICI. Madam President, I believe we are going to be able to
avoid a rollcall vote on the second McCain amendment, No. 327, if
Senator Reid is permitted to speak for one moment indicating his
opposition. I ask unanimous consent that that be the case, after which
time we will return to the amendment, and there will not be a rollcall
vote on it.
Mr. REID addressed the Chair.
The PRESIDING OFFICER. The Senator from Nevada.
Mr. REID. There will be demonstration projects in the transportation
bill that passes Congress this year. As long as there has been a House
of Representatives and we have had highways, there have been
demonstration projects. The House is showing no signs of giving them up
this year. There is no chance --no chance--that the House will pass a
transportation bill without earmarks for individual Member projects.
Given that knowledge, do we, as Members of the Senate, really want to
unilaterally disarm? There are going to be demonstration projects,
which there will be. Are we merely going to defer to the House?
Wouldn't it be better, rather than slipping projects into the final
bill going to conference, that we have an open discussion of the merits
here on the floor?
At least the House--we should give them credit for having a process.
The House committee of jurisdiction required that a 14-point checklist
be filled out for each demonstration project this year. If you do not
meet all 14, you do not get your project.
Only a few projects from the list will be selected for this funding.
In the original ISTEA legislation, under 10 percent of the projects had
earmarks. So $6.5 billion for demonstration projects out of the total
authorization of about $160 billion.
I dispute the notion of the Senator from Arizona that all
demonstration projects are glorified pork. That is not true in rapidly
growing areas. It is very important to the State of Nevada. We should
oppose this amendment.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Madam President, this is a sense-of-the-Senate
resolution that we should not have any special projects. I urge its
adoption.
The PRESIDING OFFICER. The question is on agreeing to amendment No.
327.
The amendment (No. 327) was agreed to.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. If Senators will just bear with me. There is a lot of
agreement now on amendments. So I am going to get rid of some of them
before we take the next vote, thus eliminating a lot of votes we might
have had to have.

Amendment No. 347, As Modified

Mr. DOMENICI. Madam President, I send to the desk Senator Coverdell's
amendment No. 347, as modified.
The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment (No. 347), as modified, is as follows:
At the end of title II, add the following:

SEC. . SENSE OF CONGRESS REGARDING PARENTAL INVOLVEMENT IN
PREVENTION OF DRUG USE BY CHILDREN.

(b) Sense of Congress.--It is the sense of Congress that
the provisions of this resolution assume that, from resources
available in this budget resolution, a portion should be set
aside for a national grassroots volunteer effort to encourage
parental education and involvement in youth drug prevention
and to create a drug-intolerant culture for our children.

Mr. DOMENICI. It has been cleared on the other side. We accept it.
The PRESIDING OFFICER. Do the Senators yield back their time?
Mr. DOMENICI. I yield back the time.
The PRESIDING OFFICER. The question is on agreeing to the amendment.
The amendment (No. 347), as modified, was agreed to.

Amendment No. 333

Mr. DOMENICI. We have also worked out Senator Moseley-Braun's
amendment No. 333.
This amendment is a sense of the Senate that entitlement savings in
the budget resolution should be used to protect the long-term future of
Social Security and Medicare and maintain Federal discipline.
This is also a sense of the Senate. We urge its adoption.
The PRESIDING OFFICER. The question is on agreeing to amendment No.
333.
The amendment (No. 333) was agreed to.
Mr. LAUTENBERG. I move to reconsider the vote.
Mr. DOMENICI. I move to lay that motion on the table.
The motion to lay on the table was agreed to.

Amendment No. 334

Mr. DOMENICI. I call up Moseley-Braun amendment No. 334.
The PRESIDING OFFICER. The clerk will report.
The bill clerk read as follows:

The Senator from New Mexico [Mr. Domenici], for Ms.
Moseley-Braun, proposes an amendment numbered 334.

Mr. DOMENICI. Madam President, I ask unanimous consent that further
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The text of the amendment is printed in the Record of May 21, 1997.)
Mr. DOMENICI. Madam President, this amendment is also a sense of the
Senate that no change in Social Security should be made to reduce the
value of the Social Security system for future generations. It is a
sense of the Senate. I urge its adoption.
Ms. MOSELEY-BRAUN. Madam President, I rise to make brief statements
concerning two of my amendments to the congressional budget resolution
that the Members on both sides of the aisle have agreed to support.
These two amendments are of vital importance. They concern the value
of

[[Page S5029]]

the Social Security program and the use of budget savings in the
mandatory spending areas. These are vitally important amendments
because they relate to that important issue of retirement security that
should be a part of any discussions about the Federal budget.
The first amendment, which is amendment No. 333, expresses a sense of
the Senate that the budget savings in the mandatory spending areas
contained in this budget resolution should be used:

to protect and enhance the retirement security of the
American people by ensuring the long-term future of the
social security system;
to protect and enhance the health care security of senior
citizens by ensuring the long-term future of the Medicare
program and,
to restore and maintain Federal budget discipline to ensure
that the level of private investment necessary for long-term
economic growth and prosperity is available.

Mr. President, this amendment is important because:

twenty-two percent of every dollar spent by the federal
government goes to the social security program,
another eleven percent of every dollar spent by the federal
government goes to the Medicare program,
currently, spending on the elderly accounts for a third of
the federal budget, and
while the federal budget deficit has dropped for the fourth
straight year to $67 billion in 1997, measures need to be
taken to ensure that this trend continues.

I am pleased that my colleagues have accepted this amendment and once
again, reaffirmed our commitment to protecting Americans' retirement
security and also reducing the deficit.
My second amendment, which is amendment No. 334, is one about which I
know many Members of this body are also concerned. It has to do with
the value of the Social Security program. I have begun to hold forums
in my State as a means of starting the dialog with my constituents
about the future of Social Security. I know that other Members have
held similar forums in their States as well.
The amendment simply expresses the sense of the Senate that the
budget resolution does not assume any legislative changes that would
reduce the value of the Social Security program for future generations
of retired citizens. This is an important amendment because we have an
obligation to ensure that this program which has allowed a generation
of Americans to retire with dignity must be preserved.
Madam President, a few facts will highlight the importance of the
Social Security program to Americans.
First, 13 percent of the population is over age 65 and that
percentage will increase to over 20 percent of the population by 2030;
Social Security provides over 80 percent of retirement income for 60
percent of seniors;
More than half of all senior citizens do not receive any private
pension income;
Poverty rates among the elderly are at the lowest levels since we
began collecting the data due in a large part to Social Security; and
Finally, the average Americans retiring in 2015 will have paid
$250,000 in payroll taxes during their working career.
There is no question that current retirees rely heavily upon Social
Security and future retirees expect the value of the program not to be
diminished when they need it. Therefore, I am again happy that my
colleagues support this amendment. I think we can all agree that we
must protect the value of the Social Security program for future
generations of Americans.
The PRESIDING OFFICER. If all time is yielded back, the question is
on agreeing to the amendment.
The amendment (No. 334) was agreed to.
Mr. LAUTENBERG. I move to reconsider the vote.
Mr. DOMENICI. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Madam President, I believe Senator Gramm of Texas is
going to make a point of order.

Motion To Waive The Budget Act

Mr. GRAMM. Madam President, under section 601(b) of the Congressional
Budget Act, I raise a point of order against the pending budget
resolution, as it violates the discretionary spending caps for fiscal
year 1998 as previously set in the 1993 budget resolution and
reconciliation bill.
The PRESIDING OFFICER. Under the previous order, the Senator has 2
minutes to speak on his point of order.
Mr. GRAMM. Madam President, I think this is a defining moment for the
Congress. I think it is a defining moment for those who believe in less
Government and more freedom. I think it is a defining moment for people
who are concerned about spending.
In 1993, on the floor of the Senate, on a straight party-line vote,
with a Democrat majority in both Houses of Congress, and a Democrat
President, we set out spending totals, including a cap on spending for
fiscal year 1998.
Today, in this budget, we are going to bust that spending total by
$8.795 billion. As far as I am aware, this will be the first time ever
that a Democrat Congress has set a spending cap that a Republican
Congress has come along and waived and violated, in this case by almost
$9 billion.
I think that nothing could say more clearly what the problem is with
this budget than the fact that we, as the first act in this budget,
will be busting a spending cap and setting it aside, violating the
rules of the budget in order to bring to the floor a new budget that
spends more than the budget it seeks to replace.
I think it tells you something about our commitment to enforcing
these numbers that our first act in adopting this budget is going to be
to break the very caps that we claim will enforce the new budget.
So I simply want to ask my colleagues to remember, in 1993, when we
had another budget on the floor, when it was adopted, we set out a
procedure to enforce that budget by setting a cap on spending. Today,
we are going to vote, on this vote, whether we are going to waive that
spending cap or whether we are going to live up to it.
I hope my colleagues will vote against the motion to waive this
budget point of order.
The PRESIDING OFFICER. The Senator's 2 minutes have expired.
The Senator from New Mexico.
Mr. DOMENICI. Madam President, parliamentary inquiry. Is it in order
for me now to move to waive the point of order?
The PRESIDING OFFICER. The Senator may make the motion to waive.
Mr. DOMENICI. Madam President, pursuant to section 904(c) of the
Congressional Budget Act of 1974, I move to waive section 601(b) of the
Budget Act, and pursuant to section 24(b) of House Concurrent
Resolution 218, fiscal year 1995 budget resolution, I move to waive
section 24(a) of House Concurrent Resolution 218 for the consideration
of this concurrent budget resolution for fiscal year 1998 as reported,
any amendment to the House companion, and any conference report
thereon.
Madam President, do I have 2 minutes to argue my case?
The PRESIDING OFFICER. The Senator from New Mexico is recognized for
2 minutes.
Mr DOMENICI. When the 2 minutes is up, we vote?
The PRESIDING OFFICER. The Chair advises the Senator that the yeas
and nays have not yet been ordered.
Mr. DOMENICI. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second? There is a
sufficient second.
The yeas and nays were ordered.
Mr. DOMENICI. The first thing you have to understand is that if this
point of order is not waived the budget resolution that we propose for
the next 5 years falls. It is gone. For those who would like it to
disappear and we would have no budget resolution, we can start over,
then vote for Senator Gramm.
Actually, the problem we are confronted with is not one of
overspending. It is one of technical estimating, nothing more. Two-
thirds of this overage is because we underestimated the outlays--CBO
did--the outlays of the expenditures on the Defense Department.
Actually, there is no question that we have been operating under a very
tight lid, and I do not believe we should be held responsible for a
technical error made in the estimating of the costs of the Defense
Department.
I believe we should waive this. As one who has been working on
budgets, I put it this way. I do not waive the budget

[[Page S5030]]

easily but the better thing to do is to get this 5-year budget rather
than to kill it over a point of order that, to me, makes little or no
sense in the context of the next 5 years.
Whatever time I have remaining I yield back.
The PRESIDING OFFICER. All time is yielded back. The question is on
agreeing to the motion of the Senator from New Mexico [Mr. Domenici] to
waive section 24(a) of the Budget Act.
The yeas and nays have been ordered.
The clerk will call the roll.
The bill clerk called the roll.
Mr. FORD. I announce that the Senator from North Dakota [Mr. Dorgan]
is necessarily absent.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The yeas and nays resulted--yeas 66, nays 33, as follows:

[Rollcall Vote No. 87 Leg.]

YEAS--66

Akaka
Baucus
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Bryan
Byrd
Campbell
Chafee
Cleland
Coats
Cochran
Collins
Coverdell
D'Amato
Daschle
DeWine
Dodd
Domenici
Durbin
Feingold
Feinstein
Ford
Glenn
Gorton
Graham
Grassley
Hagel
Harkin
Hatch
Inouye
Jeffords
Johnson
Kennedy
Kerrey
Kerry
Kohl
Landrieu
Lautenberg
Levin
Lieberman
Lott
Lugar
Mack
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Reed
Reid
Roberts
Rockefeller
Roth
Sarbanes
Smith (OR)
Snowe
Specter
Stevens
Thurmond
Torricelli
Wellstone
Wyden

NAYS--33

Abraham
Allard
Ashcroft
Brownback
Bumpers
Burns
Conrad
Craig
Enzi
Faircloth
Frist
Gramm
Grams
Gregg
Helms
Hollings
Hutchinson
Hutchison
Inhofe
Kempthorne
Kyl
Leahy
McCain
McConnell
Nickles
Robb
Santorum
Sessions
Shelby
Smith (NH)
Thomas
Thompson
Warner

NOT VOTING--1

Dorgan

The PRESIDING OFFICER (Ms. Collins). Three-fifths of the Senators
duly chosen and sworn having voted in the affirmative, the motion is
agreed to.
The point of order falls.
The Senator from New Mexico.

Amendment No. 316

Mr. DOMENICI. I would like to proceed to Senator Abraham's amendment
next, please.
The PRESIDING OFFICER. The Senator from Michigan.
Mr. ABRAHAM. Thank you, Madam President. I will be very brief. This
amendment is great straightforward. It is a sense-of-the-Senate
amendment that says that if during the next 5 years the money sent to
Washington by our taxpayers back home exceed the projections which we
have made in this budget resolution--and I believe they might--that
those excess additional revenues may only be spent for tax cuts or to
reduce the deficit and cannot be used for more Federal spending.
The PRESIDING OFFICER. The Senator from New Jersey is recognized.
Mr. LAUTENBERG. Madam President, we are opposed to this amendment. It
says that if the current balance results in better than expected
economic growth that we ought to go back to the lopsided approach
advocated by the majority. I, frankly, think it is illogical. Tax cuts
and deficit reductions are not the only policies that can benefit the
Nation. And unexpected tax revenue may well be put to good use funding
essential Government programs. I don't think that we ought to get
locked in at this juncture to insist that any excess revenues would go
to tax cuts or deficit reduction. I think we ought to make our judgment
at the time that these things occur.

Economic Growth Dividend Protection Act of 1997

Mr. ABRAHAM. Madam President, let me begin by praising Senator
Domenici and the other negotiators for their hard work and diligence.
They have worked for almost 4 months to put this resolution together
and end the 18-month stalemate between the President and Congress over
spending and taxes. Given these circumstances, I believe this agreement
is a step in the right direction and I look forward to seeing many of
its provisions enacted into law. On the other hand, while I intend
support this budget resolution as a whole, I want to express
reservations regarding some of its specifics.
First, I consider this resolution to be just a down-payment--not a
solution--to the entitlement reforms that will be necessary to ensure
the Federal Government's solvency going into the next century. As we
all know, the baby boom generation will soon begin to retire, which
will place enormous pressure on our Federal entitlement programs.
According to the CBO, ``. . . outlays for government programs that aid
the elderly (Social Security, Medicare, and Medicaid) will burgeon as
the number of people eligible to receive benefits from these programs
shoots up.''
Medicare is the first program to experience this problem and this
resolution allows for important reforms to extend its solvency. That
said, I believe these reforms neither go far enough nor call for the
kinds of fundamental changes that will help Medicare stay solvent past
the 10 years targeted by this resolution. I encourage the Finance
Committee to embrace reforms like MSA's, Medicare Choice, HMO's, and
PPO's as options that will increase patient options even as they hold
down costs.
I am also concerned that Congress' historical bias toward ever-
increasing spending is once again on display. While Senator Domenici
and others have worked hard to reject the myriad of new spending
proposals requested by the administration, the bottom line is 5-year
spending under this resolution will increase by 17 percent between
today and 2002. That increase is faster than the rate of inflation, and
well above the growth rates encompassed in the past two budget
resolutions.
By creating new Federal entitlements, this resolution opens the door
for huge, unexpected spending increases down the road. I applaud
efforts to improve the health of this Nation's children, but I believe
the provision to make such funding mandatory is conterproductive to our
efforts to restrain the growth of government spending. For that reason,
I support efforts to make this funding discretionary.
Finally, I am concerned that the tax cuts called for in this
resolution are so modest, especially in comparison to the spending
increases included. In particular, I am concerned that, where,
according to a USA Today poll from this March, 70 percent of the
American people believe that they need a tax cut, under this
resolution, Federal spending will grow 17 percent over 5 years while
the net tax cuts are less than 1 percent of the total tax burden.
Balancing the budget is one of my top priorities, but reducing the
burden of government on Americans is my ultimate goal.
Why do Americans need a tax cut? According to the President's own
economists, the tax burden on Americans is the highest ever--31.7
percent. According to the National Taxpayer Union, the average American
family now pays almost 40 percent of their income in State, local, and
Federal taxes. For all the talk about the ``end of big government,''
the tax burden today is the highest ever. And while we address that
burden in a small, incremental way with this budget resolution, we are
also creating the possibility for ever-more spending later on.
I believe we need to tilt the playing field away from more spending
and toward more tax reduction. Toward that end, I have offered
amendment number 316 along with Senators Brownback, Coverdell, Kyl,
Ashcroft, Sessions, Allard, Hutchinson, and Faircloth in order to focus
the attention of the Senate on the plight of American taxpayers. I am
also introducing legislation today which would codify this rule change
into law.
Madam President, as we all know, on May 2d the Congressional Budget
Office provided budget negotiators with a gift of sorts. In a letter to
Senator Domenici, the CBO report that for this year, the deficit would
be $45 billion less than previously reported. Instead of $112 billion,
the deficit this year would be closer to $67 billion.
Moreover, the CBO suggested that this $45 billion windfall would
extend over the next 5 years, so that the total devicit over that time
would be reduced by $225 billion.
From my perspective, Madam President, this windfall can be viewed as
a mixed-blessing. On the one hand, the continued strong performance of
the

[[Page S5031]]

economy means more jobs and opportunity for Americans--as well as
additional revenues to the Government.
On the other, coming as it did at literally the last possible moment
in the budget negotiations, the windfall resulted in opening up
opportunties for the administration to demand even higher levels of
spending in 1998 and beyond. It is my understanding that all sorts of
spending issues that had previously been closed were reopened following
the CBO's surprise announcement.
One area that remained closed, however, was the issue of tax cuts.
While the last 2 weeks have been filled with one announcement after
another about increases in this program, and new funding for that
program, the net tax cut number has remained stubbornly fixed at $85
billion.
I am going to support this resolution because I believe its net
effect will be to reduce both the size and scope of the Federal
Government. I am also going to support this resolution because,
according to all accounts, the tax cuts incorporated in the plan will
include significant incentives for economic growth and job creation--
incentives like reducing the rate on which we tax capital gains and
increasing the allowable contributions to IRA's.
These incentives will, I believe, result in higher economic growth
over the next 5 years and increase--not decrease--revenues to the
Federal Treasury.
Which brings me to my amendment.
What I am proposing is that, to the extent that tax revenues under
this budget agreement--tax cuts and all--exceed the projections by the
Joint Committee on Taxation, that extra revenue should be reserved for
tax cuts and/or deficit reduction--not additional Government spending.
This is not an idle proposition--history shows that pro-growth tax
cuts like cutting the capital gains tax rate result in large bonuses
for the Treasury. Between 1978 and 1985, while the top marginal rate on
capital gains was cut almost in half--from 35 to 20 percent--total
annual Federal receipts from the tax almost tripled. They rose from
$9.1 billion annually to $26.5 billion annually.
Conversely, when Congress raised the rate in 1986, revenues actually
fell well below what was anticipated. Capital gains revenues actually
fell following the Tax Reform Act of 1986. Economists across the board
predict that cutting the capital gains rate will result in a revenue
windfall for the Treasury. These windfalls should be given back to the
taxpayers.
In pursuit of that goal, I am offering today, a sense-of-the-Senate
amendment which in support of future tax cuts. It says, ``To the extent
that actual revenues exceed the revenues projected under this
resolution, that revenue windfall should be reserved exclusively for
additional tax cuts and deficit reduction.''
Madam President, 2 years ago, a Readers Digest poll asked Americans:
``What is the highest percentage of income that is fair for a family of
four making $200,000 to pay in all taxes?'' The median response,
regardless of whether the respondent was rich or poor, black or white,
was 25 percent.
A similar Grassroots Research poll last March discovered that a
majority of Americans would favor a constitutional amendment that would
prohibit Federal, State, and local taxes from taking ``a combined total
of more than 25 percent of anyone's income in taxes.''
Yet, the Tax Foundation tells us that a dual-income family today pays
an average 38.4 percent of their income in taxes to State, local, and
Federal Governments.
This budget starts us down the long road toward reducing the tax
burden on American families--but it is just the beginning. I intend to
continue that fight. I hope my colleagues will support my amendment.
Mr. ABRAHAM. Madam President, I just seek unanimous consent to add
Senators Faircloth, Allard, and Hutchison of Texas as additional
cosponsors.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from New Mexico.
Mr. DOMENICI. I don't believe I have any time.
The PRESIDING OFFICER. Does the Senator from Michigan yield back the
remainder of his time?
Mr. ABRAHAM. I yield the remainder of my time.
I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the amendment
of the Senator from Michigan. On this question, the yeas and nays have
been ordered, and the clerk will call the roll.
The legislative clerk called the roll.
The result was announced--yeas 56, nays 44, as follows:

[Rollcall Vote No. 88 Leg.]

YEAS--56

Abraham
Allard
Ashcroft
Bennett
Bond
Brownback
Burns
Campbell
Chafee
Coats
Cochran
Collins
Coverdell
Craig
D'Amato
DeWine
Domenici
Enzi
Faircloth
Frist
Gorton
Gramm
Grams
Grassley
Gregg
Hagel
Hatch
Helms
Hutchinson
Hutchison
Inhofe
Jeffords
Kempthorne
Kohl
Kyl
Lott
Lugar
Mack
McCain
McConnell
Murkowski
Nickles
Roberts
Roth
Santorum
Sessions
Shelby
Smith (NH)
Smith (OR)
Snowe
Specter
Stevens
Thomas
Thompson
Thurmond
Warner

NAYS--44

Akaka
Baucus
Biden
Bingaman
Boxer
Breaux
Bryan
Bumpers
Byrd
Cleland
Conrad
Daschle
Dodd
Dorgan
Durbin
Feingold
Feinstein
Ford
Glenn
Graham
Harkin
Hollings
Inouye
Johnson
Kennedy
Kerrey
Kerry
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Mikulski
Moseley-Braun
Moynihan
Murray
Reed
Reid
Robb
Rockefeller
Sarbanes
Torricelli
Wellstone
Wyden
The amendment (No. 316) was agreed to.
Mr. DOMENICI. Madam President, I move to reconsider the vote.
Mr. MURKOWSKI. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
The PRESIDING OFFICER. The Senate will be in order. The Senator from
New Mexico is recognized.

Amendment No. 313

Mr. DOMENICI. Madam President, I believe we are ready to go to
Senator Wellstone's amendment.
The PRESIDING OFFICER. The Senator from Minnesota.
Mr. WELLSTONE. Thank you, Madam President. May I have order?
The PRESIDING OFFICER. The Senate will be in order.
Mr. WELLSTONE. Madam President, the budget----
Mr. DOMENICI. The Senate is not in order. We have to hear.
The PRESIDING OFFICER. The Senate will be in order. Senators desiring
to converse will retire to their cloakrooms. Senators will take their
seats. The Senator from Minnesota.
Mr. WELLSTONE. Madam President and Senators, the budget is all about
priorities. This amendment speaks to priorities. This amendment says
that we invest in crumbling schools all across our country $5 billion,
that we should do that now. This amendment says that, while we have
made progress with Head Start in this budget agreement, still only half
the children, if you consider early Head Start, are covered and we
should cover more of these children. This amendment says that last year
we made cuts in the school breakfast program, we made cuts in the child
nutrition programs for Family Head Start Centers, and therefore we
ought to restore that nutritional funding for poor children in America.
Madam President, altogether this amendment says we make investments
in these areas to the tune of about $20 billion over the next half
decade, and the offset is to make sure that the cuts in taxes are
targeted to middle income and small business, not the top 2 percent of
the economic profile in the country, and that we look at all of these
loopholes and deductions in corporate welfare.
The PRESIDING OFFICER. The time of the Senator has expired.
It is the Chair's understanding that the Senator is calling up
amendment No. 313?
Mr. WELLSTONE. That is correct.
The PRESIDING OFFICER. The time of the Senator has expired. The
Senator from New Mexico.

[[Page S5032]]

Mr. DOMENICI. Madam President, this amendment would reduce tax relief
contained in the resolution by $16 billion in order to increase
spending in programs that the Senator would like to see increased. It
happens, in the programs that he would like to see increased, such as
Head Start, this budget resolution has an increase of $2.7 billion. It
makes it a priority program, so it will most probably be funded at that
extraordinarily high level. That was agreed upon. But sometimes, no
matter how much you do, it is not enough. In this case, the President
brags about the fact that Head Start is going up and going up
appreciably, $2.7 billion, yet the Senator would reduce our tax cut for
the American people in order to add yet more to that program.
I do not believe that is what we ought to do. I yield back any time I
have. Does the Senator from any time remaining?
The PRESIDING OFFICER. The time of the Senator has expired. All time
has expired.

Amendment No. 357 to Amendment No. 313

(Purpose: To provide children who have been victims of violent crime
the ability to transfer to another school by allowing States and local
educational agencies to use Federal education funds in the jurisdiction
of the Labor Committee to assist such victims in attending any other
school of their choice, whether public, private, or sectarian)

Mr. DOMENICI. On behalf of Senator Coverdell, I submit a second-
degree amendment.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from New Mexico [Mr. Domenici], for Mr.
Coverdell, proposes an amendment numbered 357 to amendment
No. 313.
On page 3, line 3, increase the amount by 0.
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On page 4, line 4, increase the amount by 0.
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On page 4, line 6, increase the amount by 2,539,000,000.
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On page 22, line 8, increase the amount by 2,539,000,000.
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On page 44, line 6, increase the amount by 0.

Mr. DOMENICI. I yield my time to the Senator from Georgia.
Mr. COVERDELL. Madam President, the issue embraced by this amendment
is simple but important. In too many schools across our Nation the
focus for our children is not on education but survival. Just 2 days
ago, as I read from the Washington papers, four teenagers were arrested
and charged with gang raping a 14-year-old girl last month by luring
her from a cafeteria at a public high school in Queens to an unused
classroom to carry out the attack, the authorities said yesterday. This
amendment would allow local school districts, agencies, the right to
use a voucher system to allow a victim of a crime to escape this kind
of environment.
Madam President, I yield my time.
The PRESIDING OFFICER. The Senator from Minnesota.
Mr. WELLSTONE. Madam President, my colleagues on the other side do
not want to have an up-or-down vote on whether or not they are willing
to invest in child nutrition programs and whether or not they are
willing to invest in rotting schools. Instead of this increased
investment, they want to now vote on the proposition that we have funds
that go in an unlimited, unconditional way through a private voucher
plan. That is what this vote is all about.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. LAUTENBERG. Madam President, we are talking now about a whole
different program outside the budget resolution. Vouchers --vouchers do
not deserve to be debated in this context. We ought to absolutely
oppose it. I hope we will find some of our friends on the Republican
side who will also oppose the notion of transferring these funds into
school vouchers.
The PRESIDING OFFICER. The Senator from Georgia.
Mr. COVERDELL. Madam President, I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. Do Senators yield back all their time? All
time is yielded.
The question is on agreeing to the second-degree amendment. The yeas
and nays have been ordered.
The clerk will call the roll.
The legislative clerk called the roll.
The PRESIDING OFFICER (Mr. Roberts). Are there any other Senators in
the Chamber who desire to vote?
The result was announced, yeas 51, nays 49, as follows:

[Rollcall Vote No. 89 Leg.]

YEAS--51

Abraham
Allard
Ashcroft
Bennett
Bond
Brownback
Burns
Campbell
Coats
Cochran
Coverdell
Craig
D'Amato
DeWine
Domenici
Enzi
Faircloth
Frist
Gorton
Gramm
Grams
Grassley
Gregg
Hagel
Hatch
Helms
Hutchinson
Hutchison
Inhofe
Kempthorne
Kyl
Lott
Lugar
Mack
McCain
McConnell
Murkowski
Nickles
Roberts
Roth
Santorum
Sessions
Shelby
Smith (NH)
Smith (OR)
Snowe
Stevens
Thomas
Thompson
Thurmond
Warner

NAYS--49

Akaka
Baucus
Biden
Bingaman
Boxer
Breaux
Bryan
Bumpers
Byrd
Chafee
Cleland
Collins
Conrad
Daschle
Dodd
Dorgan
Durbin
Feingold
Feinstein
Ford
Glenn
Graham
Harkin
Hollings
Inouye
Jeffords
Johnson
Kennedy
Kerrey
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Mikulski
Moseley-Braun
Moynihan
Murray
Reed
Reid
Robb
Rockefeller
Sarbanes
Specter
Torricelli
Wellstone
Wyden
The amendment (No. 357) was agreed to.
Mr. DOMENICI. Mr. President, I move to reconsider the vote by which
the amendment was agreed to.
Mr. MURKOWSKI. I move to lay that motion on the table.

[[Page S5033]]

The motion to lay on the table was agreed to.

Amendment No. 313

The PRESIDING OFFICER. The question recurs on the Wellstone No. 313,
as amended.
The question is on agreeing to the amendment.
The amendment (No. 313), as amended, was agreed to.
Mr. DOMENICI addressed the Chair.
The PRESIDING OFFICER. The Senator from New Mexico is recognized.
Mr. DOMENICI. Mr. President, I believe Senator Grams has an
amendment. He is going to call it up.
The PRESIDING OFFICER. The Senator from Minnesota is recognized.

Amendment No. 346

Mr. GRAMS. Mr. President, I call up amendment No. 346.
The PRESIDING OFFICER. The clerk will report the amendment.
The legislative clerk read as follows:

The Senator from Minnesota [Mr. Grams] proposes an
amendment numbered 346.

(The text of the amendment is printed in the Record of May 21, 1997.)
The PRESIDING OFFICER. The Senator is recognized.
Mr. GRAMS. Thank you, Mr. President. I will be brief, but I will try
to talk loudly.
This is a simple and straightforward amendment, and it will address
just two of the weaknesses of the budget agreement; namely, big
spending for the Government and small tax relief for working Americans.
All it does is to require that we use half of the $225 billion of the
CBO revenue windfall for tax relief and half for deficit reduction and
keep nondefense discretionary spending at the cap freeze baseline
level.
If the $225 billion in extra money is, indeed, real, it did not fall
mysteriously from the sky. It is money that belongs, first and
foremost, to the American taxpayers, and it should be put to proper
use. Keeping nondefense spending at freeze baseline levels would reduce
total spending by only 1.5 percent over the next 5 years. If American
workers are working harder and producing more, they should be able to
keep it, not send it to Washington.
So I urge my colleagues to support this amendment, and I thank you
very much, Mr. President.
I yield back the remainder of my time.
The PRESIDING OFFICER. Who seeks time? The Senator from New Mexico is
recognized.
Mr. DOMENICI. Mr. President, I say to my fellow Senators, it is with
regret that I have to oppose this amendment. Essentially, this would
totally break the budget agreement. We would be back at ground zero.
This would propose to take another $134 billion in cuts out of the
domestic programs beyond that which we did in this budget, another $134
billion cut off the discretionary programs that are only growing at
half a percent.
I also must tell you the so-called windfall was used in the following
manner: Only $30 billion of it was used for spending over the 5 years,
and that went for defense, transportation, and dropping the per capita
cap on Medicare.
I believe that we had to do that. I believe it was in everybody's
interest that we do that. That is where it went, and that is what we
did. So if time has expired, I move to table the amendment.
The PRESIDING OFFICER. The question is on the motion to lay on the
table the amendment No. 346.
Mr. MACK. I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second? There appears to
be.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion to
lay on the table. The yeas and nays have been ordered. The clerk will
call the roll.
The assistant legislative clerk called the roll.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
desiring to vote?
The result was announced--yeas 73, nays 27, as follows:

[Rollcall Vote No. 90 Leg.]

YEAS--73

Abraham
Akaka
Baucus
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Bryan
Bumpers
Burns
Byrd
Campbell
Chafee
Cleland
Cochran
Collins
Conrad
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Dorgan
Durbin
Feingold
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Hagel
Harkin
Hatch
Hollings
Inouye
Jeffords
Johnson
Kempthorne
Kennedy
Kerrey
Kerry
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lott
Lugar
Mack
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Reed
Reid
Robb
Roberts
Rockefeller
Sarbanes
Shelby
Smith (OR)
Snowe
Specter
Stevens
Torricelli
Wellstone
Wyden

NAYS--27

Allard
Ashcroft
Brownback
Coats
Coverdell
Enzi
Faircloth
Gramm
Grams
Grassley
Gregg
Helms
Hutchinson
Hutchison
Inhofe
Kyl
McCain
McConnell
Nickles
Roth
Santorum
Sessions
Smith (NH)
Thomas
Thompson
Thurmond
Warner
The motion to lay on the table the amendment (No. 346) was agreed to.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Thank you, Mr. President.
Mr. President, might I say to the Senate, in terms of the budget
resolution, unless something untoward occurs, we have no more than
three votes remaining. So we ought to be finished in reasonably short
order, although I want to remind everyone that in the morning
announcement the leader said we might have votes in the remainder of
the day on judges and a treaty. So before you assume there will be no
additional votes, you better check with the hot line or with the
leadership office.
Mr. DOMENICI. The next amendment is Wellstone amendment No. 314.
I yield the floor.

Amendment No. 314

Mr. WELLSTONE. I call up amendment No. 314.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Minnesota [Mr. Wellstone], for himself,
Mr. Reed, Mr. Bingaman, and Mr. Moynihan, proposes amendment
numbered 314.

Mr. WELLSTONE. Mr. President, I ask unanimous consent that further
reading of the amendment be dispensed with.
The PRESIDING OFFICER. Without objection, it is so ordered.
(The text of the amendment is printed in the Record of May 21, 1997.)
The PRESIDING OFFICER. The Senator from Minnesota is recognized.
Mr. WELLSTONE. I proposed the amendment with Senator Reed, and also
as cosponsors are Senator Bingaman and Senator Moynihan.
This amendment, I say to my colleagues, expands the Pell grant
program. It takes it up to $3,500. It is authorized up to $4,500 right
now. It is a commitment of about $6 billion over 5 years. This will
help thousands of families.
This will make a huge difference, especially to families with incomes
of about $25,000 to $30,000 who, more or less, fall between the cracks
on some of the other assistance that we are giving. So it is very
targeted. It is very effective. The money comes from loopholes and
deductions.
We could be talking about tens of billions, if not hundreds of
billions of dollars, in that. Just invest a little more in the Pell
grant program. This is extremely important to working families in our
country.
Mr. DOMENICI addressed the Chair.
The PRESIDING OFFICER. The Senator from New Mexico is recognized.
Mr. DOMENICI. I thank the Chair.
I ask the Senator, do you yield back your time?
Mr. WELLSTONE. Senator Reed was going to speak.
The PRESIDING OFFICER. The Senator has 4 seconds remaining under his
time.
Mr. WELLSTONE. I thought we had 2 minutes.
Mr. FORD. Equally divided.
The PRESIDING OFFICER. The Chair reminds the Senator that there was 1
minute for each side.
Mr. WELLSTONE. Mr. President, it was my mistake, I say to my
colleagues.
I ask unanimous consent that Senator Reed have 30 seconds to speak.
Mr. DOMENICI. No objection.
The PRESIDING OFFICER. Without objection, it is so ordered. The
Senator is recognized.

[[Page S5034]]

Mr. REED. I thank the Chair. I will make two very brief points.
First, in 1972, we passed the Pell grant. If we simply indexed that
grant for inflation, the maximum Pell grant today would be $4,300. We
are asking for an increase from $3,000 in this budget to $3,500.
Second, back in 1980, the maximum Pell grant covered 72 percent of the
cost of a 4-year public college. Now it covers roughly 20 percent. We
need more. That is what the Wellstone-Reed amendment asks us to do.
Mr. WELLSTONE. I ask unanimous consent that Senator Moseley-Braun be
added as an original cosponsor.
The PRESIDING OFFICER. Without objection, it is so ordered.
The Senator from New Mexico.
Mr. DOMENICI. Mr. President, this amendment should be defeated. The
budget resolution before the Senate increases Pell grants from $2,700
to $3,000. Even the President of the United States says that is
adequate. This will be a very healthy increase. We have already done
that. I do not believe we ought to add further moneys to the Pell
grants and take it away from the taxpayers of this country. It is that
simple. There is adequate funding already in this bill.
I yield back the balance of my time.

Amendment No. 358 to Amendment No. 314

(Purpose: To ensure that the provisions of this resolution assume that
any higher education tax relief are consistent with the objectives set
forth in this resolution and shall include provisions that encourage
parents and students to save for higher education expenses and that
provide relief from the debt burden associated with borrowing to pay
for a postsecondary education)

Mr. DOMENICI. Mr. President, I send a second-degree amendment to the
desk on behalf of Senator Snowe and ask for its immediate
consideration.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from New Mexico [Mr. Domenici], for Ms. Snowe,
for herself and Mr. Coverdell, proposes an amendment numbered
358.

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

On page 3, line 4, increase the amount by 0.
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On page 4, line 5, increase the amount by 0.
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On page 21, line 25, increase the amount by 0.
On page 22, line 1, increase the amount by 0.
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On page 43, line 21, increase the amount by 0.
On page 43, line 22, increase the amount by 0.
On page 43, line 24, increase the amount by 0.
On page 43, line 25, increase the amount by 0.
On page 44, line 2, increase the amount by 0.
On page 44, line 3, increase the amount by 0.
On page 44, line 5, increase the amount by 0.
On page 44, line 6, increase the amount by 0.

Ms. SNOWE. I thank Senator Domenici.
I understand the intent of the amendment offered by the Senator from
Minnesota in terms of expanding the Pell Grant Program, and I am
pleased the budget agreement includes increasing the maximum grant by
$300.
Unfortunately, the Senator's amendment is in violation of the budget
agreement, so I am offering an amendment that says we shall include two
types of tax cut proposals in the $35 billion postsecondary educational
tax cut package in this budget agreement. One proposal would provide
incentives for parents and students to save for a postsecondary
education. The other proposal would be to try to offset the debt that
is incurred by students as a result of borrowing to attend college.
My amendment is consistent with the objectives that were put forward
in the budget agreement, as agreed to by President Clinton and the
negotiators, and I urge its adoption.
Mr. President, as we all know, the budget resolution provides for $85
billion in net tax relief over the coming 5 years. In a May 15, 1997,
letter to President Clinton, the Speaker of the House and the Senate
majority leader agreed that the tax package ``must include tax relief
of roughly $35 billion over 5 years for postsecondary education,
including a deduction and a tax credit.'' The letter further stipulated
that this package of postsecondary education tax cuts ``should be
consistent with the objectives put forward in the HOPE scholarship and
tuition tax proposals contained in the administration's fiscal year
1998 budget.''
Now, even before that letter was crafted, there had been concerns
about the inclusion of any type of education tax cuts in the balanced
budget plan. For some, the inclusion of such targeted tax cuts would
undermine the overall effort to provide broad-based tax relief for as
many Americans as possible. For others, the postsecondary tax cut
proposals put forward by President Clinton were viewed as potentially
counter-productive because they might actually encourage tuition
increases or grade inflation.
Regardless of how one feels about educational tax cuts in general--or
President Clinton's postsecondary education tax cut proposals
specifically--I think we can all agree that the objective of the $35
billion education tax cut package in this resolution, and President
Clinton's fiscal year 1998 educational tax cut proposals, are clear:
Postsecondary educational tax cuts must promote access to a higher
education while addressing the needs of parents and students.
And the amendment I am offering today would encourage that we do
both. It is an amendment stating that our $35 billion postsecondary tax
cut package shall provide tax incentives that encourage students and
parents to save for a postsecondary education, and provide relief from
the debt burden associated with borrowing to pay for a postsecondary
education. These two proposals--and my amendment--are not only
consistent with the objectives laid out by President Clinton in his own
budget proposal, but also with the objectives outlined in the May 15
letter from the Speaker of the House and our majority leader.
Mr. President, a strong commitment to education is included in this
budget agreement because of a recognition that education is the great
equalizer in our society that can give every citizen of our Nation--
regardless of race, income, or geographic background--the same
opportunity to succeed in the global economy of the 21st century. It's
the same reason I decided to make education a priority during the 1995
and 1996 balanced budget debate, and fought to preserve funding for the
Student Loan Program--a program that ensures access to higher education
for lower-income students. A bipartisan majority of the Senate shared
that commitment, and we now have the opportunity to further strengthen
access to higher education through the crafting of sound tax proposals
within this balanced budget package.
As we seek to identify proposals that would improve access to a
higher education, it is critical that we first recognize the primary
barrier that stands between a student and a post-secondary education:
rising costs. According to the Institute of Higher Education Policy,
students at the undergraduate level have seen tuition increases outpace
inflation for more than a decade. As a result of these increasing
costs, an estimated 7.6 million students will require and receive aid
in 1997--and this number is expected to increase to 8.1

[[Page S5035]]

million in 1998. Similarly, due to the significant costs of graduate
and professional school training, borrowing by these students is
increasing even faster than the record rate of increase in total
student loan borrowing overall.

How much money is borrowed by students to meet these rising costs?
According to a 1996 analysis by USA Group Loan Services, the typical
student loan borrower--including undergraduate, graduate, and doctoral
students--now accumulates more than $10,000 in educational debt. By the
same token, the interest paid on this borrowing is enormous. In Maine
alone, students pay $25 million in interest on their student loan debts
every year. Clearly, these rising costs and accumulating debts place
the future of our children and our Nation at stake. Many students may
wonder if they will ever be able to pay off the debt burden they will
absorb if they go to college--and others will simply drop the idea of
pursuing a higher education altogether in light of these numbers.
Mr. President, Congress must remain committed to ensuring that every
individual has the opportunity to pursue a higher education while
adopting policies that ensure students are not dissuaded from attending
a post-secondary institution for financial reasons. While no tax cut
can completely remove financial barriers to a higher education, we can
certainly endorse sound policies as part of this resolution that adhere
to the agreement reached with the White House and move us in the right
direction. I believe that providing incentives for parents and students
to save for a higher education, and providing tax relief for the debt
accumulated by those who need to borrow, is among the policies we
should adopt to move us in that direction.
While the amendment I am offering today does not endorse any specific
bill or plan, I would like to note that I offered legislation on May 1
that would accomplish both of these goals. S. 680, the ``Go to
College!'' Tax Incentives Act, would promote savings by young Americans
and their parents to prepare for the rising cost of a higher education,
and ensure that students are not discouraged from applying for students
loans simply because of the debt burden they would incur in seeking a
higher education.
First, the legislation provides an incentive for parents and children
to put aside as much as $1,000 per child annually in an education
savings account that would be allowed to grow tax free. Planning for
the future is critical when one considers the rising cost of tuition,
and my incentive to save would make such planning less difficult.
Second, the legislation provides a tax credit of $1,500 for the
interest paid on student loans, thereby encouraging students to borrow
as necessary to go to college--not balk at the cost of a higher
education and the related debt they need to incur.
Many Members of this body have supported restoring the deduction for
interest paid on student loans--as evidenced in both of the Republican
and Democratic leader bills, S. 1 and S. 12 respectively. While I, too,
have long supported the restoration of this deduction, the credit I am
proposing in S. 680 would be even more beneficial. Simply put, a tax
deduction lowers a student's gross income on the Federal income tax
form--but a tax credit actually reduces the tax liability of a student.
Although this provision would not benefit students immediately, they
would be assured of substantial tax relief once they begin to pay off
the student loan debt they accumulated when they chose ``go to
college'' in the first place.
Again, the amendment I am offering today does not call for the
adoption of the ``Go to College!'' Tax Incentives Act--rather, I
mention my bill only to show that there are proposals on the table that
would achieve the objectives sought by President Clinton, and that can
be further reviewed during budget reconciliation. Ultimately, any
number of these proposals could effectively meet the objectives set
forth by President Clinton and the majority leader, and I am hopeful
that we will adopt the best such approaches during the reconciliation
process. Therefore, although the amendment I am offering today does not
endorse a specific bill, it ensures that we at least adopt two types of
proposals that will move us in the right direction.
Mr. President, we must ensure that our nation's students do not turn
away from pursuing a higher education due to rising costs and
increasing debt burdens. This amendment would ensure that we address
these issues during the ongoing reconciliation process, while remaining
consistent with the objectives laid out in this balanced budget
agreement, and I urge its adoption. Thank you, Mr. President.
Mr. WELLSTONE. Mr. President, we will agree to a voice vote on this
amendment.
With all due respect to my colleague, whom I greatly respect, No. 1,
this second-degree amendment strikes out all the investment, so as
opposed to plugging some of the loopholes in corporate welfare we make
no investment in the expansion of Pell grants. That is what this vote
is about.
No. 2, you can talk about savings. Families with incomes under
$20,000 a year--since 1979, 8 percent of them, women and men from those
families, have been able to graduate from college. Do you not think we
ought to make sure they get assistance?
The PRESIDING OFFICER. The Senator from Rhode Island.
Mr. REED. Mr. President, no one objects to Pell grants. This should
be a vote about expanding the Pell grants so we can change the reality
that faces working families in this country.
In 1975, 80 percent of Federal financial assistance was in the form
of grants and 20 percent in loans. Today, those numbers are reversed. I
believe we should expand the Pell grants along the lines of the
Wellstone-Reed amendment.
I hope we can do that sometime.
The PRESIDING OFFICER. All time has expired. The question now is on
agreeing to the second-degree amendment of the Senator from Maine.
The amendment (No. 358) was agreed to.
Mr. DOMENICI. I move to reconsider the vote.
Mr. LAUTENBERG. I move to lay it on the table.
The motion to lay on the table was agreed to.

Amendment No. 314

The PRESIDING OFFICER (Mr. Thomas). The question now occurs on the
amendment of the Senator from Minnesota, as amended.
The amendment (No. 314), as amended, was agreed to.
Mr. DOMENICI. Senator Specter has an amendment, and I yield the
floor.
The PRESIDING OFFICER. The Senator from Pennsylvania.

Amendment No. 340

Mr. SPECTER. Mr. President, I call for a vote on amendment No. 340.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from Pennsylvania [Mr. Specter] proposes an
amendment numbered 340.

(The text of the amendment is printed in the Record of May 21, 1997.)
The PRESIDING OFFICER. The Senator from Pennsylvania.
Mr. SPECTER. Mr. President, this is a very important amendment
because it will determine whether we will have an increase in NIH
grants and, in fact, whether we will have NIH grants at their current
level.
Night before last, by a vote of 98 to 0, this body passed a sense-of-
the-Senate resolution which increased NIH grants by $2 billion. But the
fact is that the 550 account on health is cut by $100 million. This
amendment asks the Senate to put its money where its mouth is. If the
sense of the Senate which passed two nights ago is to have any sense,
this amendment has to be agreed to.
I understand that the leadership is opposed to this amendment. I
understand that there is an argument that nothing we do here on this
budget resolution amounts to anything; that it is all up to the
appropriators. In a sense, that is correct. But I believe the
appropriators will be influenced by a positive vote here, especially
when the leadership is going to try to defeat this amendment.
If this amendment is defeated, I can explain to the constituency
groups who come to me as chairman of the subcommittee that there was no
money. But if this sense-of-the-Senate resolution for $2 billion is to
be understood, this amendment has to pass.
I thank the Chair.
Mr. DOMENICI. I yield time in opposition to the chairman of the
Appropriations Committee.

[[Page S5036]]

Mr. STEVENS. Mr. President, I ask Senators to do something
irregular--that is, pick up the bill and look at what this amendment
does to the Appropriations Committee. On page 23, you will see on line
9 an increase of $137.8 billion for health. If you look at page 35
where this amendment touches, it has ``new budget authority for
allowances''--no new budget, no outlays.
What it means is we would have to go into every other account and
pull out money to put it in this one account, an account that is
already increased under this budget by $137.8 billion.
The Senator came to me and asked me if I would be bound by this. I
checked with Senator Byrd. We cannot be bound by this. Some of those
accounts--by the way, this is an absolute across-the-board cut--cannot
take that.
For those of you in agriculture, agriculture has already been cut.
Space and technology has already been cut. We have to go in and cut
those further in order to put this money into an account that has
already a $137.8 billion increase under this budget.
I urge you to vote against it, because we do not want to have to go
against the sense of the Senate. But we would have to under this
because we cannot comply with this.
I move to table the amendment, and I ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question is on agreeing to the motion of
the Senator from Alaska to lay on the table the amendment of the
Senator from Pennsylvania. On this question, the yeas and nays have
been ordered, and the clerk will call the roll.
The legislative clerk called the roll.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
who desire to vote?
The result was announced--yeas 63, nays 37, as follows:

[Rollcall Vote No. 91 Leg.]

YEAS--63

Abraham
Allard
Ashcroft
Bennett
Biden
Bond
Breaux
Bryan
Bumpers
Burns
Byrd
Campbell
Chafee
Cleland
Coats
Cochran
Conrad
Coverdell
Craig
Daschle
Domenici
Dorgan
Enzi
Faircloth
Ford
Frist
Gorton
Gramm
Grams
Gregg
Hagel
Hatch
Helms
Hutchinson
Hutchison
Inhofe
Johnson
Kempthorne
Kyl
Landrieu
Lautenberg
Leahy
Lieberman
Lott
Lugar
McCain
McConnell
Murkowski
Nickles
Reid
Roberts
Rockefeller
Roth
Sessions
Shelby
Smith (NH)
Smith (OR)
Stevens
Thomas
Thompson
Thurmond
Torricelli
Warner

NAYS--37

Akaka
Baucus
Bingaman
Boxer
Brownback
Collins
D'Amato
DeWine
Dodd
Durbin
Feingold
Feinstein
Glenn
Graham
Grassley
Harkin
Hollings
Inouye
Jeffords
Kennedy
Kerrey
Kerry
Kohl
Levin
Mack
Mikulski
Moseley-Braun
Moynihan
Murray
Reed
Robb
Santorum
Sarbanes
Snowe
Specter
Wellstone
Wyden
The motion to table the amendment (No. 340) was agreed to.
Mr. STEVENS. Mr. President, I move to reconsider the vote.
Mr. DOMENICI. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. DOMENICI addressed the Chair.
The PRESIDING OFFICER. The Senator from New Mexico.
Mr. DOMENICI. Mr. President, if I could have the attention of the
Senate, everybody is asking where we are on this.
The PRESIDING OFFICER. May we have order? The Senator from New
Mexico.
Mr. DOMENICI. Mr. President, let me say to Senators I have about five
cleanup matters and one amendment we are going to accept, and then we
go right to final passage. That should not be longer than 3 or 4
minutes.

Amendment No. 359

(Purpose: To make technical corrections)

Mr. DOMENICI. Mr. President, I send a managers' technical corrections
amendment to the desk. It has been approved by both sides. It is
nothing but numbers, number changes.
The PRESIDING OFFICER. The clerk will report.
The assistant legislative clerk read as follows:

The Senator from New Mexico [Mr. Domenici], for himself and
Mr. Lautenberg, proposes an amendment numbered 359.
On page 4, increase the amount on line 4 by $1,800,000,000.
On page 4, decrease the amount on line 5 by $100,000,000.
On page 4, decrease the amount on line 7 by $200,000,000.
On page 4, decrease the amount on line 8 by $300,000,000.
On page 4, decrease the amount on line 13 by $200,000,000.
On page 4, decrease the amount on line 14 by $100,000,000.
On page 4, decrease the amount on line 15 by $200,000,000.
On page 4, decrease the amount on line 16 by $400,000,000.
On page 4, decrease the amount on line 20 by -$200,000,000.
On page 4, decrease the amount on line 21 by -$100,000,000.
On page 4, decrease the amount on line 22 by -$200,000,000.
On page 4, decrease the amount on line 23 by -$400,000,000.
On page 5, increase the amount on line 2 by $4,800,000,000.
On page 5, increase the amount on line 3 by $6,200,000,000.
On page 5, increase the amount on line 4 by $6,100,000,000.
On page 5, increase the amount on line 5 by $7,700,000,000.
On page 18, increase the amount on line 8 by
$1,800,000,000.
On page 23, increase the amount on line 15 by $100,000,000.
On page 23, increase the amount on line 22 by $100,000,000.
On page 24, increase the amount on line 12 by $100,000,000.
On page 29, decrease the amount on line 18 by $200,000,000.
On page 29, decrease the amount on line 19 by $200,000,000.
On page 30, decrease the amount on line 2 by $300,000,000.
On page 30, decrease the amount on line 3 by $300,000,000.
On page 30, decrease the amount on line 10 by $300,000,000.
On page 30, decrease the amount on line 11 by $300,000,000.
On page 30, decrease the amount on line 18 by $300,000,000.
On page 30, decrease the amount on line 19 by $300,000,000.
On page 39, line 1, strike beginning with the word
``provide'' through line 4, the word ``outlays'', and insert
``reduce the deficit''.
On page 39, decrease the amount on line 22 by $35,000,000.
On page 39, decrease the amount on line 23 by $75,000,000.

THE PRESIDING OFFICER. If there be no further debate, the question is
on agreeing to the amendment.
The amendment (No. 359) was agreed to.

Amendment No. 309

Mr. DOMENICI. Mr. President, I call up amendment 309. This amendment
creates a reserve fund with no money in it for childhood education. I
urge we adopt it.
The PRESIDING OFFICER. The clerk will report.
The legislative clerk read as follows:

The Senator from New Mexico [Mr. Domenici], for Mr. Kerry,
for himself, proposes an amendment numbered 309.

(The text of the amendment is printed in the Record of May 21, 1997)
THE PRESIDING OFFICER. If there be no further debate, the question is
on agreeing to the amendment.
The amendment (No. 309) was agreed to.

Amendment No. 319 Withdrawn

Mr. DOMENICI. I understand, Senator Gramm, you withdraw amendment
319?
Mr. GRAMM. I do.
The PRESIDING OFFICER. Without objection, it is so ordered. The
amendment is withdrawn.
The amendment (No. 319) was withdrawn.
Mr. LAUTENBERG. Mr. President, I would like to engage in a colloquy
with Senator Domenici regarding the investment in transportation that
is included in this budget agreement.
Mr. President, as most of my colleagues know, I am a strong believer
in increasing investment in transportation, whether for roads, bridges,
rail systems, aviation, or mass transit. All modes of transportation
are important, and all need to be supported.
We have been working hard in the negotiations to increase total
investment in transportation, and we have had some success. We have
increased total transportation outlays over the President's request by
more than $8 billion over the next 5 years. That is not as much as I
would like, but it is a start.
I would like to clarify one element of the budget agreement as it
relates to

[[Page S5037]]

spending the estimated revenues of the highway trust fund over the next
5 years. That is a goal with which I agree. In an ideal world, I would
support even higher spending levels from the highway trust fund.
However, it is important to clarify that, while this agreement
includes an assumption that we will spend from the highway trust fund
the amounts equivalent to receipts currently estimated to come into the
trust fund, the possibility that receipts will grow beyond the levels
currently estimated could endanger our ability to comply with other
equally important assumptions in this agreement including increased
spending for mass transit and Amtrak.
In the end, the Appropriations Committee will have to set ceilings
for individual subcommittees and funding levels for specific
transportation programs, and I want to clarify that increases in
highway trust fund spending will not negatively impact other modes of
transportation, especially mass transit and Amtrak.
I therefore would ask my good friend, the chairman of the Budget
Committee, do you agree that nothing in this agreement, nor in the
budget resolution, requires the Senate to spend all gas tax revenues
without regard for the potentially negative impact on other modes of
transportation?
Mr. DOMENICI. Senator Lautenberg is correct.
The budget resolution contains an assumption that the Appropriations
Committee will provide adequate funding to spend all gas tax revenues
into the highway trust fund. In addition, the budget resolution also
contains an assumption which provides increased funding for mass
transit and Amtrak, in addition to the increase in highway trust fund
spending. Therefore, I am optimistic that this agreement provides
enough funding to accomplish our mutual goals of spending all trust
fund revenues while maintaining our commitments to other modes of
transportation, including increased funding for mass transit and
Amtrak.
Mr. McCAIN. Mr. President, I rise for the purpose of entering into a
short colloquy with the distinguished chairman of the Budget Committee.
Mr. Domenici, I understand that the budget resolution assumes
reinstatement of the aviation excise taxes, which fund important
aviation safety and security programs, and include the 10 percent tax
on the price of domestic airline tickets.
Mr. DOMENICI. That is correct.
Mr. McCAIN. As you know, the National Civil Aviation Review
Commission has undertaken a review of the appropriate funding structure
for the national aviation system, and is scheduled to report its
legislative recommendations at the end of this summer. The commission
may develop an acceptable alternative to the traditional aviation
excise tax system. Am I correct in assuming that the budget resolution
does not preclude substituting an alternative funding mechanism for the
current aviation excise taxes?
Mr. DOMENICI. That is my understanding, as well. The budget
resolution assumes reinstatement of the aviation excise taxes. This
assumption should not be read to preclude replacement of the taxes with
an alternative means of funding the national aviation system, as long
as that alternative is consistent with the budget resolution.
Ms. SNOWE. Mr. President, when it comes to our budget deliberations,
the temptation of politics has often made our search for a balanced
budget a difficult one. For a long time, I think all Members of this
body would agree that too much time was spent aggressively defending
narrow or partisan interests. Personal political interests were
sometimes placed above pressing national interests. And common,
bipartisan objectives were too seldom charted or pursued. The result
for our Nation is now as widely known as it was troublesome: Spending
kept expanding. Deficits kept rising. And confidence in Government kept
diminishing.
But here today, Mr. President, with a balanced budget plan before us
for the first time in 28 years, it's encouraging to think that we may
be reaching a new beginning. Much of the credit for bringing us to this
point belongs to the chairman of the Budget Committee, Pete Domenici.
The chairman has demonstrated his unwavering commitment to a balanced
budget during his years of service on the Budget Committee, and,
ultimately, it was his leadership that brought both sides to the table
and made this day possible. For his ongoing efforts, I believe that the
chairman is deserving of our thanks--and the thanks of generations of
Americans to come.
Let me also thank our majority leader, Trent Lott, for his effort and
commitment to making this agreement possible, and the President of the
United States for his willingness to negotiate and compromise. I know
that it is the hope and expectation of most Americans that President
Clinton will continue to stay focused on the balanced budget goal and
see this plan through to fruition.
And, finally, we should also recognize the other leaders of the House
and the Senate who were engaged in this process. They, too, pursued
this resolution with determination and vigor--and forged consensus on
some very divisive issues. We would not be here today without their
leadership.
But Mr. President, we have also reached this encouraging point in our
budget deliberations because--at last--there is a widespread
recognition that deficits threaten this Nation in unacceptable ways--
and that decisive action is needed now to ward off economic crisis. The
numbers speak for themselves. According to estimates from the
President's own Office of Management and Budget, if we do nothing, the
deficit will double in 15 years, then double again every 5 years
thereafter. Left unchecked, according to OMB, the deficit would reach
$2 trillion by 2025.
We also know that such a scenario would prove intolerably costly to
this Nation. OMB forecasts that if we fail to reign in the deficit now,
future generations will suffer an 82-percent tax rate and a 50-percent
reduction in benefits in order to pay the bills we are leaving them
today. And the Congressional Budget Office has issued a similarly grave
warning, arguing a year ago that: ``* * * current U.S. budget policies
cannot be sustained without risking substantial economic damage.''
Eighty-two-percent tax rates. Fifty-percent reductions in benefits.
Substantial economic damage. This is not some futuristic nightmare, Mr.
President. This is the economy that lies ahead for America unless we
act now, unless we lay the groundwork for long-term deficit elimination
by adopting this resolution.
Mr. President, this agreement provides us with an historic
opportunity to place our country back on the right fiscal path. But it
also provides the American people some assurance that our political
process can work. After more than 2 years of competing proposals,
acrimonious debates, and fruitless negotiations, many Americans have
become understandably cynical of our ability and even willingness to
ever agree on a plan to balance the budget. But this agreement should
give us some hope. It proves that we can compromise on specifics
without compromising on principle--that when an agreement indisputably
benefits the American people, we can set aside partisanship and get the
job done.
Of course, while the resolution before us today is an encouraging one
and should be celebrated, we should also recognize what it is not. This
is only a first step, Mr. President, and no Member of this body can say
with certainty that this resolution signals a conclusive end to the
failed budget politics of old. Indeed, I believe that only a balanced
budget amendment to the Constitution can ensure that fiscal prudence
and responsibility will be exercised indefinitely into the future.
And let me be clear about another matter. The budget resolution
before us is not perfect. Are there flaws in it? Yes, Mr. President, I
think there are. In fact, I suspect that every Member of this body
could find aspects that trouble them in this resolution--aspects that
they may have written in a slightly or even greatly different manner.
For instance, some may criticize this resolution because it expands
new entitlements or does too little to reform existing entitlements
before the baby boom generation begins to retire. In fact, it is with
the latter concern in mind that I am particularly troubled by the
assumption of home health care being shifted from part A to part B of
Medicare. I fear that this shift may actually imperil this vital
program even as it masks the true problems of the

[[Page S5038]]

Medicare trust fund, which must be addressed if we are to preserve and
protect the Medicare Program for senior citizens in the future. Still
others may criticize this plan as being insufficient in terms of
deficit reduction because it would cut the deficit by only 1 percent of
today's GDP over the next 5 years, or because it provides what they
consider to be too much of an increase in discretionary spending. To
put these types of concerns in the words of one analyst from the CATO
Institute: ``On balance, this is a bad deal. Republicans should just
say no.''
Conversely, there are those who may see the cuts quite differently
and argue that this agreement goes too far in cutting certain programs
and does too little to fund new initiatives. Still others do not
support the tax relief included in this resolution, or argue that the
package of tax cuts being discussed would disproportionately benefit
higher income individuals or families.
But Mr. President, after 28 years of deficit spending, we can
no longer let the perfect be the enemy of the good. We can no longer
let politics drive our budget decisions because for 2 years--2 years,
Mr. President--Republicans and Democrats have squared-off over a
variety of issues, while offering competing plans. And the result has
been wholly unimpressive. There has been no agreement. No plan for a
balanced budget. And I think it's worth noting that the only reason
that we have this resolution before us today is that competing budget
plans were unsuccessful. It is compromise that offers us this chance to
reach agreement and lay the groundwork for long-term balance. But if
each Member of this body rejects such compromise and demands instead
that the plan do exactly what he or she would want in the ideal world,
then only one thing is for sure: This plan will be derailed--and our
historic opportunity will be lost.

And lest we focus only on those parts of the budget that are less
than perfect, let's not overlook the incredibly positive aspects of
this plan. For instance, not only will this plan balance the budget in
the year 2002, if its policies are continued, OMB tells us that it will
lead to a surplus of $34 billion in the year 2007. And while many have
cited the fact that the total deficit reduction in this plan will be
only $204 billion over the next 5 years, they fail to mention that
there will be more than $700 billion in additional savings during the 5
years thereafter. Consider for a moment the two dramatically different
futures that potentially lie ahead for this Nation: If we reject this
plan and continue with the status quo, we will add another $1.1
trillion to the national debt over the next 10 years. On the other
hand, if we use the 2002 to 2007 surpluses to buy-down the debt, this
plan will ensure that more than $800 billion would be available for
useful investments, and not eaten up by the national debt.
Perhaps most importantly, by putting us on a course to balance the
budget in 5 short years, this plan will also allow us to address the
significant long-term threats described by OMB and CBO because we will
have laid the groundwork for even larger reforms in the coming years.
And it will also hold future Congresses accountable to maintain this
same level of fiscal responsibility.
And let's not forget the important impact that a balanced budget will
have on economic growth. I know that there are those who say that our
economy is doing well. They point to the growth rate for the last
economic quarter and the fact that we now have had continuous growth
for 6 straight years, and they say things could not be rosier. And it's
at least partly true, Mr. President. We are now approaching the post-
World War II record for the longest period of growth without a
recession. But no one is projecting that the economy will maintain this
pace, and the average annual rate of growth during the current 6-year
streak has been an unimpressive 2.5 percent--the lowest level of growth
during a recovery in this century.
But, tragically, even this lethargic annual rate of growth is not
predicted to last--and cannot last--unless we tackle the deficit now.
Look out to future years and we see that the economy is anticipated to
grow at even more anemic rates; 2.0 percent in 1998; 2.1 in 2000. The
numbers are not impressive. However, with the enactment of a balanced
budget plan, CBO tells us that potential growth will be enhanced
because resources now devoted to consumption can instead be used for
investment. So, Mr. President, this resolution presents us with our
most direct and tangible means of stimulating economic growth in the
short-term, even as we seek to extend our current economic expansion
for another 5 years.

And, finally, to those concerned with various details of the plan,
let's remember this: Within the framework of this resolution, there are
specific levels of savings in various programs, specific levels of tax
cuts and the resolution even includes some of the policies that should
be used to achieve these targets. But, appropriately, this resolution
does not spell out all of the details, and it leaves opportunities for
the authorizing and appropriating Committees to fulfill the parameters
and benchmarks that have been set. So let's remember that the goal of
this resolution--a balanced budget in 2002--is in ink, but some of the
details are still in pencil. And that's OK. The administration will
continue to have the opportunity to encourage specific spending
priorities, and Members of this body will also have their opportunity
to influence and mold these decisions.
Now, Mr. President, let me address one final question. Whenever there
is a political initiative as significant as the one before us, pundits
begin to ask: ``Who is the political winner in this agreement? Is it
Republicans? Or is it Democrats?'' Well, let me suggest an answer: The
winner in this resolution is our Nation and its people. Deficits have
damaged this Nation and its citizens for 28 years and set us on an
inevitable economic crash course. But today, with this resolution, we
have an opportunity to avert this crash by ending these deficits in the
short-term, which lays the groundwork for eliminating them completely
in the long-term. What lies before us is a framework for achieving a
balanced budget by 2002 and holding off the pending disaster that
inaction invites.
So I think our goal could not be more clear: We cannot let this
opportunity slip through our hands. We must begin anew--never again
permitting our Nation to be recklessly endangered by deficits and
deficit spending. We must move forward with a recognition that our
budget belongs to the people--and, as such, it must always be handled
carefully and responsibly. These are our challenges--and, together, we
can and must meet them.
Mr. President, ``a journey of a thousand miles begins with the first
step.'' I am reminded of this Chinese proverb today because this
resolution represents such a monumental first step in our journey to a
balanced budget. To be sure, our journey is not complete. And it will
not be complete unless Members of this body, the House of
Representatives, and the President maintain a strong commitment in the
coming years to follow through and make this balanced budget goal a
reality. We cannot falter in these coming challenges. But, in the
meantime, we should celebrate today for all that it represents. Mr.
President, this resolution places our Nation on the right path and,
against a future of uncontrolled deficits and all that the dangers and
problems that these deficits entail, this resolution gives us hope for
a new beginning of fiscal sanity, economic growth, and prosperity.
So I think our choice should be clear. We need to take this path--and
we need to adopt this resolution. The benefit of doing so, Mr.
President, is too great. The cost of failing to do so, conversely, is
simply too severe.
Mr. REED. Mr. President, like many I recognize that this budget
agreement is a good faith effort. It shows a recognition by Republicans
that their past plans were extreme and unpopular. Indeed, the agreement
acknowledges, to a degree, that Americans want us to invest in
priorities.
However, for all its positive steps, I do not believe it is the right
budget outline for our future. I support a balanced budget plan, but I
cannot support a resolution which sets in motion a questionable package
of unfair tax cuts and other misguided priorities.
The agreement contains a number of laudable elements. The welfare
act's excesses are curbed. It takes a small first step toward health
care coverage for children, and important education tax credits are
provided. And it does purport to continue the march toward a balanced
budget.

[[Page S5039]]

Indeed, we would not be able to consider this agreement without the
1993 budget agreement. With only Democratic votes, that package has cut
the deficit for 4 years in a row and brought the deficit to its lowest
point as a percentage of the Gross Domestic Product [GDP] since 1974.
Ironically, my colleagues on the other side of the aisle predicted the
1993 budget would cause economic collapse and ruin. Yet, today, the
economic growth generated, in part, by the 1993 budget has brought us
to the point where it is conceivable to reach budget balance. Today's
national economy is a marvel of low inflation, low unemployment, and
strong revenues, which is good news for many although it has yet to
reach some in my State of Rhode Island.
Again, there are sound elements of this plan, but I would caution
that a budget resolution is short on specifics, long on figures, and
tends to obscure the magnitude of what is under consideration. While
the budget resolution is nonbinding, it imposes an austere procedural
and fiscal discipline on what the Senate can and cannot do. Certainly
the defeat of the Hatch-Kennedy amendment showed that this budget
resolution can, and could continue to be, used to thwart efforts to
meet even the health care needs of America's children.
Mr. President, for all its effort, I believe this agreement falls
short in a number of key areas.
First, the deal's economic assumptions are optimistic, and are based
on a $225 billion midnight revenue windfall estimate from the
Congressional Budget Office. Sadly, the accuracy of these estimates is
not guaranteed. Since 1980, CBO's revenue estimates have been wrong 11
times, and, on several occasions, these estimates have been off by more
than $50 billion. I would also add that try as the Senate might, the
business cycle cannot be legislated out of existence. My sincerest hope
is that the current economic growth continues, however, history shows
that what goes up usually comes down. If we experience a downturn, this
agreement could need massive retuning, which would probably not include
the elimination of tax breaks for the well-to-do, but would mean pain
for society's most vulnerable.
Second, and, most important, I believe the agreement's nontargeted
tax breaks are the wrong direction for an agreement which claims to
balance the budget. When we are engaged in the task of trying to
balance the budget, we should not make the job more difficult by
enacting questionable tax breaks for those individuals who are already
benefiting handsomely from the current economic growth.
This agreement calls for tax cuts totaling $250 billion over 10
years. When it comes to taxes, what starts small, explodes later.
Indeed, 44 percent of the cost of the agreement's tax breaks are packed
into the years 2005, 2006, and 2007. Indeed, the cost of these tax cuts
grows 32 percent in the final 2 years of the deal. What does this
portend for the second 10 years of the agreement? According to the
nonpartisan Center on Budget and Policy Priorities, the revenue loss
could reach up to $650 billion from 2008 to 2017. I would hasten to
remind my colleagues that this is the time when the baby boom retirees
will begin to place enormous pressure on already strained entitlement
programs.
In contrast, targeted, middle-class tax breaks, like the Hope
Scholarship, are supportable because they help working families afford
college and prepare their children for the competitive international
economy. Unfortunately, the agreement lacks even the attractiveness of
closing corporate welfare loopholes that subsidize the shipment of jobs
overseas and other questionable business activities to pay for tax
breaks.
Mr. President, the specifics of the tax bill this agreement calls for
are questionable to say the least. As the resolution's year-by-year
revenue loss tables show, there is plenty of budgetary room for time
bombs and gimmicks. Indeed, after the revenue loss from the tax breaks
doubles between 1999 and 2000, it falls in 2001 and 2002, but it keeps
rising and explodes after 2007. As others have pointed out, the pattern
is not accidental. Instead, it is designed to permit a number of
questionable tax gimmicks to give the appearance of fairness and fiscal
propriety. One such revenue trick is to phase in the capital gains
indexation which conveniently hides the first 5 year revenue loss and
assumes more revenue early on in the second 5 years as investors rush
to cash in on capital gains indexing. According to experts, capital
gains indexing will cost three times as much in the second 5 years as
in the first 5 years of the budget deal.

Some may argue that if gimmicks are employed and subsequently wreak
havoc on deficit reduction, Senators will do the right thing and repeal
these taxes. Mr. President, I am not so sure that you can put the tax
cut genie back in the bottle. This agreement contains no commitment to
control a revenue loss explosion. Indeed, all of the President's
requests for such assurances were rejected by Republicans. The word
``permanent'' is used to describe the capital gains tax cuts, but not
the President's education tax incentives. I would also add that it is
very difficult to repeal taxes both politically and practically. For
example, phased-in capital gains indexing and other revenue games are
hard to repeal or modify because taxpayers will have accepted the
Government's tax cut offer on which the Senate would be hard pressed to
renege.
But, I am not simply concerned with revenue loss and tax cut
chicanery. I believe that many of the tax cuts called for in this
agreement are of dubious merit and value. The best example of this fact
is an across the board capital gains tax cut. Such a proposal is not
investment oriented. There will be no holding period or connection to
investments in small businesses. As Paul Volker, former head of the
Federal Reserve said before the Senate Finance Committee:

``. . . a near-term reduction in the capital gains tax rate
from present levels does not strike me as a pressing matter,
especially given the current performance of the economy and
the medium and longer-term budgetary prospects . . . [A] very
large across the board reduction of capital gains taxes poses
serious problems of equity and complexity, of revenue loss
and of distortion of decision making.
If public policy is to make a serious effort to raise the
level of savings and investment, and do so equitably, the
priorities seem to me clear. We should move as fast as we can
toward a surplus in the Federal budget.''

There are those who would argue that a capital gains cut would help
millions of Americans. However, the typical beneficiary of a capital
gains cut is not a middle-income family. Indeed, households with
incomes over $100,000 receive about three-quarters of all capital gains
income, and as the Joint Tax Committee reported--JCS-4-97:

``. . . [W]hile many taxpayers may benefit from an
exclusion or indexing for capital gains, the bulk of the
dollar value of any tax reduction will go to those taxpayers
who realize the bulk of the dollar value of gains.''

In other words a capital gains tax cut benefits the wealthy who
actually have capital gains.
There are other questionable tax cuts in this plan, such as the
estate tax cut which would only benefit the top 1.2 percent of estates
and the backloaded IRA proposal which aims to increase savings for
retirement, but causes a revenue loss explosion when the pressure on
entitlements is most acute due to the baby boomers. Again, the
President had tax proposals which were better and helped family
business owners without significantly adding to the deficit.
Third, while the agreement correctly focuses on education through a
$35 billion targeted tax incentives for college costs, a commitment to
increase the Pell grant for fiscal year 1998, a commitment to
technology in the classroom, and a minimal commitment to improving
literacy, the need may exceed what this plan allows due to its 10
percent reduction in domestic investment in real terms. Groups like the
Committee for Education Funding are greatly concerned about the
restrictive discretionary spending caps in the agreement which could
severely thwart efforts to invest in our education needs. The agreement
contains no school construction funds and little room in budget caps
for such an initiative. There is no room for further Pell grant
increases, as the defeat of my amendment to increase Pell grant funding
demonstrates. There are scarce resources for the estimated $4.8 billion
price tag to reform schools as suggested by the National Commission on
Teaching and America's Future. Moreover, there is no commitment to fund

[[Page S5040]]

Goals 2000, School to Work, national service, or the burgeoning need
for research into early childhood development
Fourth, the agreement makes very modest room for health care needs,
and, as I have stated there was no room in this agreement for a more
robust children's health care program paid for with a tax on tobacco. I
am also concerned that there are limited resources available for the
National Institutes of Health's fight against cancer and HIV.
Fifth, I am concerned that the $115 billion in Medicare cuts called
for in the agreement may exceed what is absolutely needed to preserve
Medicare. Indeed, the level of cuts in the years 2001 and 2002 total
$69 billion. I am also disturbed that no solid estimates are available
for the premium increases that many seniors face. The agreement also
ignores the long-term-solvency issues of the Medicare program and may
leave some with the mistaken impression that Medicare is guaranteed to
be there for them. There are even those in the other body who would
like to add the dubious concept of medical savings accounts to this
plan.
Sixth, the agreement ignores our investment deficit, and even its new
initiatives lose ground due to inflation and in relation to the growing
tax cuts. Specifically, infrastructure investment is frozen at a time
when the U.S. Department of Transportation estimates we need $50
billion each year just to properly maintain our transportation system.
Last week, a Rhode Island television station ran a series on the poor
road conditions of my State, but sadly this agreement provides only
minimal assistance to fix Rhode Island's roads. In the area of housing,
the agreement notably extends essential section 8 contracts for senior
housing, but leaves little for other affordable housing programs. Last,
my colleagues should ask themselves whether the budget caps employed to
offset the cost of unsound tax cuts will crowd out important programs
and hamstring the Senate's ability to respond to the needs of all
Americans in an increasingly competitive world?
The agreement does not continue the path of deficit reduction begun
by the 1993 budget agreement. Indeed, the deficit actually increases in
each of the next 3 years from $67 billion this year to $90 billion in
1998 to $90 billion in 1999 to $83 billion in 2000. Then miraculously,
the deficit falls as the Congress starts to cut $69 billion from
Medicare, $49.7 billion from domestic investments, $46 billion from
defense, and $10 billion from Medicaid. All these reductions fall in
just 2 years, leaving little margin for unsound budget estimates or
exploding tax cuts.
Mr. President, on balance there is much in this agreement that should
be applauded, and the bipartisanship it displays is laudable. It
acknowledges that the Contract With America embodied the wrong policies
and priorities for our future. It provides for some investments in
health care and education. It restores some benefits for legal
immigrants hurt by last year's welfare act, and it builds on the
success of the 1993 deficit reduction package.
However, the fundamental question is, Does this agreement meet the
challenges of the future? Will it allow us to truly reform education?
Will it help more working families afford college? Will it rebuild our
roads, bridges, and rails? Will it provide opportunities for those
making the transition from welfare to work? Most important, is this
agreement fair or does it ask too much of those who can least afford
it?
Mr. President, this budget resolution is not the plan for our future.
It is too generous where fiscal discipline is required and too tight-
fisted where investment is direly needed. And, sadly, it fails to meet
the test of fairness and honesty we owe hard working American families.
Mr. President, as the specific legislation to implement this
agreement is developed, I am hopeful that its excesses can be curbed,
and I would urge my colleagues to accept amendments which would make
this plan worthy of greater support.
Mr. LEVIN. Mr. President, the revenue provisions in the budget
resolution which is before the Senate reflects the bipartisan budget
agreement entered into by the President and the congressional
leadership. I quote from the Budget Committee's report accompanying
this resolution:

The Bipartisan Agreement assumes the net tax cut shall be
$85 billion over the next five years and not more than $250
billion over the next ten years, to provide tax relief to
American families. Under the Agreement, revenues would
continue to grow, from $1554.9 billion in 1997 to $1890.4
billion in 2002, an increase of $335.5 billion over the five
year period.
As always, the Ways and Means Committee in the House and
the Finance Committee in the Senate will determine the
specific amounts and structure of the tax relief package. The
tax-writing committees will be required to balance the
interests and desires of many parties (while protecting the
interests of taxpayers generally) in crafting the tax cut
within the context of the goals adopted by the Bipartisan
Budget Agreement.

I also want to read those guidelines from the letter sent to the
President on May 15, 1997, from the Speaker of the House and the Senate
majority leader:

It was agreed that the net tax cut shall be $85 billion
through 2002 and not more than $250 billion through 2007. We
believe these levels provide enough room for important
reforms, including broad-based permanent capital gains tax
reductions, significant death tax relief, $500 per child tax
credit, and expansion of IRAs.
In the course of drafting the legislation to implement the
balanced budget plan, there are some additional areas that we
want to be sure the committees of jurisdiction consider.
Specifically, it was agreed that the package must include tax
relief of roughly $35 billion over five years for post-
secondary education, including a deduction and a tax credit.

Would the distinguished ranking member of the Budget Committee agree
that this agreement and this budget resolution leave great flexibility
for the Congress to shape the tax reconciliation bill?
Mr. LAUTENBERG. I do agree with the Senator from Michigan.
Mr. LEVIN. Does the Senator agree that within the parameters of an
$85 billion net tax cut through the year 2002 and no more than $250
million over the next 10 years, including $35 billion in tax relief
over 5 years for post-secondary education, including a deduction and a
tax credit, there is significant flexibility in the size and the
targeting of a permanent capital gains tax reduction and in the size
and the specifics of death tax relief included in the package?
Mr. LAUTENBERG. Again, the Senator is correct.
Mr. LEVIN. Does the Senator agree that the term ``broad-based'' as
applied to permanent capital gains reductions as in the agreement
letter, and in the committee report is subject to a reasonable debate
as to its interpretation?
Mr. LAUTENBERG. I agree with the Senator.
Mr. LEVIN. And does the Senator agree that the term ``significant''
as it is applied to estate tax relief in that same letter and in the
report is subject to reasonable interpretation as to the size and
specific provisions of any change in the estate tax?
Mr. LAUTENBERG. I do agree.
Mr. LEVIN. As I read the table summarizing the agreement, entitled
``Long Range Summary, 1997-2007,'' on page 77 of the committee print,
there is an agreement regarding net tax figures for the years 1997
through 2002. The word ``agreement'' appears above the columns for
those years. The word ``projections'' appears above the columns for the
years 2003 through 2007. Am I correct then that the net tax cut figures
for the years 2003 through 2007 are not agreements on specific numbers,
but the numbers in those years are simply OMB projections?
Mr. LAUTENBERG. The Senator from Michigan is correct.
Mr. LEVIN. I thank the distinguished ranking member of the Budget
Committee. I ask these questions to reflect my concern that any tax
bill produced pursuant to the budget agreement and this budget
resolution not set in motion tax policies which will create large
deficits in the next decade. Also, I strongly believe we must carefully
study the effect of any tax provisions which we include in the revenue
reconciliation legislation to assure that it is fair, and not weighted
to benefit principally those who need it least.
Mr. KENNEDY. Mr. President, with reluctance, I oppose this budget
resolution. It has many worthwhile features, and I am hopeful that as
the process continues, it can be significantly improved. In its current
version, it has too many obvious defects.
It contains excessive tax cuts that are likely to balloon in the
future and lead to massive new deficits that make

[[Page S5041]]

the pledge of a genuinely balanced budget a hollow promise. It fails to
ask the rich to make a fair contribution to reducing the deficit, and
rewards them with massive tax breaks instead. It threatens the system
that delivers health care to the elderly. It contains excessive
reductions in the needed level of public investment. And it does not do
enough to provide health insurance coverage to the 10 million children
without such coverage today.
The last time a budget promised balance and large, ballooning tax
cuts at the same time was the Reagan budget of 1981. And the tax cuts
in this budget do balloon in the future. As a May 21 study by the
Center on Budget and Policy Priorities shows, the tax cuts in the
budget are growing at a rate of 32 percent in the final 2 years of the
first 10-year period. That study also indicated that the tax cuts are
likely to cost about $650 billion, nearly two-thirds of a trillion
dollars in the second 10-year period, from 2008 through 2017.
The budget also asks too little sacrifice from corporate tax
subsidies.
Our recent budget history should teach us that we only have so much
money for tax cuts. We should target those scarce tax cut dollars to
working families and the middle class. But too many of the tax cuts
that the Republican majority brags about in this budget would benefit
the very wealthiest individuals and corporations.
As part of the bipartisan budget agreement, Speaker Gingrich and
Senator Lott wrote to the President, ``We believe these levels provide
enough room for * * * broad-based permanent capital gains reductions,
significant death tax relief, * * * and expansion of IRAs.'' President
Clinton will be hard-pressed to preserve his important tax cuts for
education if the Republican majority in Congress holds to its present
course.
The capital gains tax cuts in S. 2, the Republican leadership tax
bill, would cost $33 billion in the first 5 years and fully $96 billion
in the second 5 years. More than 85 percent of its benefits would go to
those with incomes greater than $100,000 a year, according to an
analysis by Citizens for Tax Justice. Fully two-thirds of the benefits
from lowering the capital gains tax rate would go to the top 1 percent
of taxpayers--those with incomes above $241,000. This wealthy elite
would get an average tax cut of about $6,800 from the capital gains tax
cut, while families in the middle fifth of the population would get an
average tax cut of $4.
The estate tax cuts in S. 2, the Republican leadership tax bill,
would cost $18 billion in the first 5 years and $48 billion in the
second 5 years. All of the benefits of these tax cuts would go to the 1
percent of estates larger than $600,000 in value.
A 1989 Joint Tax Committee analysis of an IRA provision similar to
that in the Republican leadership tax bill found that 95 percent of the
benefits went to the top fifth of taxpayers.
Reasonable restrictions on the tax cuts for capital gains and estate
tax relief place much less of a burden on the deficit. The Democratic
leader, for example, has introduced targeted capital gains tax cuts
that cost $4.5 billion, and estate tax cuts that cost $3 billion over
the next 5 years.
In addition, this budget takes only modest steps to control the
massive subsidies that the tax laws now bestow on the wealthy. It has
been estimated that over four-fifths of tax subsidies go to the richest
fifth of the population. At a time when billions of dollars of budget
cuts are being proposed in health benefits for the elderly, it makes no
sense to provide tax breaks to billionaires who renounce their
citizenship.
The tax expenditures listed in a December 1996 Senate Budget
Committee report add up to more than $2.7 trillion over the next 5
years. That's more than 30 percent of the cost of running the entire
Federal Government over the same time period. These tax entitlements
represent a larger share of the Federal budget than Social Security,
Medicare, Medicaid, or any spending program.
Together with Senator John McCain and other Senators, I have joined
in a bipartisan effort to reduce corporate subsidies using a base-
closing type Federal commission. Cutting corporate subsidies would
introduce a needed element of fairness in the budget. When so many
individuals and families are being asked to bear a heavy burden of
budget cuts, there should be no free rides for special interest groups
and their cozy subsidies.
Medicare cuts, at $115 billion, make up nearly two-fifths of the
total spending cuts in this budget. These Medicare cuts grow to $155
billion over 6 years, and $215 billion over 7 years. Even though this
budget does not ask as much of beneficiaries as did the Republican
budgets of the last 2 years, cuts of this size raise serious questions
about the continued willingness of Medicare providers to participate in
the system.
Defense did not sacrifice to make its contribution. The levels in the
budget are essentially the higher of either the President's or the
Republicans' proposals. The Republicans' levels were higher in the
short run, and the President's levels were higher in the long run.
Domestic appropriations contribute $61 billion over 5 years and are
assumed to contribute $273 billion over 10 years to keep the budget in
balance. Coming after the 1990 budget, which essentially froze total
appropriations, these cuts seriously reduce the pool of money from
which education, research, and other needed investments are made to
ensure the future growth of the economy.
The budget does make a worthwhile start for children's health, by
allotting $16 billion--$3.2 billion a year on average--over the next 5
years. But the budget also takes $14 billion out of Medicaid at the
same time, leaving doubts about how much net funding will actually
reach children in need.
We should be realistic about what $3.2 billion a year can and cannot
do. According to the Congressional Budget Office, the Federal cost of
providing Medicaid coverage to one child in 1997 will be $860. At $860
per child, $3.2 billion dollars a year will cover about 3.7 million
children. This level is only one-third of the number of uninsured, just
enough to cover those children below poverty with a little left over.
If we stop at the $16 billion in the budget agreement, we will be
leaving out almost 7 million children in working families who earn too
much for Medicaid but not enough to buy the health insurance their
children need.
The $20 billion over the next five years in the Hatch-Kennedy CHILD
amendment was designed to help these families, and I regret that it was
narrowly defeated. Senator Hatch and I continue to believe that is
should be included in the budget, and we intend to offer it as part of
the reconciliation bill later this year.
The debates ahead will offer realistic opportunities to improve the
budget package in all of these areas and eliminate its worst
provisions. I look forward to working with my colleagues to enact a
balanced budget that truly reflects the Nation's needs and priorities.
Mr. KEMPTHORNE. Mr. President, I rise today in support of Senate
Concurrent Resolution 27, the Concurrent Budget Resolution for fiscal
year 1998. This resolution charts the course to achieve the goal that
the people of America and Idaho want and deserve--a balanced budget.
With the spending targets set forth in this resolution Congress will
balance the federal budget for the first time in nearly 30 years.
This accomplishment has a very personal perspective for me because
the last we had a balanced budget, in 1969, I was a junior in high
school. Now, almost 30 years later, as we are on the verge of balancing
the budget again, I have two children in high school who have never
seen a balanced budget. An entire generation of Americans has lived
their entire lives under the burden of a national debt that is now
almost $20,000 for every man, woman and child in this country. Our
children deserve a better future than having to pay the interest on a
$5 trillion debt. This budget resolution offers them hope for a better
tomorrow.
Mr. President, I am proud to support this monumental budget
resolution not only because it achieves a balanced budget and
eliminates the national debt, but because it accomplishes these goals
while providing significant tax relief to working American families.
This resolution confirms that the money in the Federal budget belongs
to the taxpayers of this country, not the government, and it s about
time we start leaving more of it where it belongs, in the taxpayers
pocket.
This resolution provides families with a $500 per child tax credit,
cuts

[[Page S5042]]

the estate tax, provides a capital gains tax reduction and allows tax
relief for education costs. And the resolution provides for these tax
cuts while reducing Federal spending more than one trillion dollars
over the next decade.
This resolution doesn't forget our commitment to the elderly. We
accomplish these tax cuts and spending reductions without making any
legislative changes to Social Security, and we shouldn't, Social
Security is not the problem. This budget also insures the solvency of
Medicare by simply slowing the rate of growth while still allowing
spending to increase 28 percent, more than twice the rate of inflation.
This is an increase from $209 billion this year up to $280 billion in
2002. Without this reform the Medicare Trustee s report estimated that
the Medicare Part A trust fund would be bankrupt by 2001.
Mr. President, the budget resolution before us is a strong plan for
reversing the decades old Washington habit of spend, spend, and spend
some more. It won't be easy to stop this out of control deficit train
and turn it around, but Republicans are determined to get the job done,
and we will.
I am proud to vote for this resolution and with it a brighter
tomorrow for our children. I ask my colleagues to join me in supporting
Senate Concurrent Resolution 27.
I yield the floor.
Mr. GLENN. Mr. President, I rise to comment on the important
resolution before us today, the concurrent budget resolution. This is
truly a remarkable occasion. We are considering the outlines of a plan
that will balance the budget over the next 5 years.
This bipartisan proposal achieves a number of important
accomplishments. The most significant of course is balancing the budget
by 2002. I believe that the Budget Committee Chairman Domenici and
ranking member Lautenberg have done an outstanding job in their work to
bring this agreement to the floor of the Senate.
Without a constitutional amendment, this agreement will balance a
budget that has been the focal point of national debate and a goal
supported by most every candidate for President and Senator for at
least as long as I have been in office.
Four years ago we proposed cutting the budget deficit in half. After
many difficult and contentious votes, Senate Democrats along with a tie
breaking vote from Vice-President Gore helped enact a program that set
us on a course of real deficit reduction. Many criticized that effort
and predicted economic disaster. But now after 4 years of economic
growth and reduced deficits we are in a position to finish the job.
After 4 years, our deficit has been reduced from $290 billion down to
$67 billion.
This proposal outlines a plan to extend the solvency of the Medicare
trust fund for at least a decade. It will expand beneficiaries' choice
of private health plans by allowing preferred provider plans and
provider sponsored plans to compete in the managed care programs in
Medicare. Additional preventive health benefits are provided and
beneficiary copayments for outpatient services are limited. Part B
premiums are maintained at 25 percent of program costs and any
increases necessary for home health care benefits are phased in over 7
years. Low income seniors are protected from any potential home health
premium increases.
In order to ensure that important areas of service are adequately
protected this agreement identifies priorities such as education
reform, Pell grants, child literacy, and Head Start.
Two very important initiatives are anticipated in this agreement. The
first provides $16 billion to expand health coverage to up to 5 million
children who do not now have health insurance. The second revises last
year's welfare reform to restore necessary benefits to disabled
immigrants. I believe that the President's initiatives on these issues
are commendable.
Although important progress is made in this agreement, I want to make
clear that I have a number of concerns.
I have worked on and voted on budget agreements before and I
recognize some of the pitfalls. My first concern is the question of tax
cuts. If the first priority of this agreement is to balance the budget,
I do not believe that we should make that job any harder. This
agreement calls for a net tax cut of $85 billion over 5 years. Why
can't we eliminate these cuts and balance the budget sooner? Why can't
we apply those funds to establish a budget surplus and apply it to debt
reduction?. Or at least, why can't we wait to determine if this
agreement and its underlying assumptions prove successful? What happens
to our deficit reduction and balanced budget efforts in the event of an
economic downturn? There is no assurance that this agreement will be as
successful as the one 4 years ago.
I recognize that tax incentives have historically been employed to
stimulate a sluggish economy. Although some may argue our economic
growth could be even higher, last quarter's 5.6 percent growth is the
highest in 10 years. The stock market is at record highs, a core
inflation rate of 2.5 percent in the last year is the best in 30 years,
the monthly unemployment rate of 4.9 percent is at a 25 year low. I am
not convinced that this is time to use tax cuts to stimulate the
economy. I believe that deficits should be reduced in good economic
times. If tax cuts are to be used in good economic times what tools
will we have in a less favorable economy?
The tax cuts anticipated in this resolution are calculated to cost a
net $85 billion over 5 years. I am concerned, however, that beyond the
scope of the 5 year resolution the cost of these tax cuts will go even
higher. Indeed the agreement expects that the 10 year cost will rise to
$250 billion.
Even though this agreement provides for a balanced budget in 2002,
entitlement spending is expected to soar beyond the turn of the
century. Yes, we improve the solvency of Medicare in this budget and
put it on a firm footing for 10 years, but beyond that time frame
Medicare costs will rise. This agreement continues to use the surplus
provided by the Social Security system to reach a balance. Beyond the
turn of the century the surpluses will provide retirements benefits for
baby boomers. I am concerned that again we are putting off finding a
solution to these problems when relatively small steps taken now can
avoid much larger steps that will undoubtedly need to be taken later.
During the consideration of the resolution I supported efforts to
provide additional support for children without health insurance,
additional support for early childhood development, and additional
support to rebuild crumbling schools. Although we were unsuccessful on
these amendments, this will not be the end of the work. Those battles
will continue throughout the reconciliation and appropriations process
and I am hopeful that we will have some success.
Let me say further that I recognize that just because this agreement
does not solve each and every problem is no reason to oppose it. The
perfect then becomes the enemy of the good. Important progress is made
here and although not perfect I intend to vote for the good.

growth wins

Mr. ROTH. Mr President, it is no coincidence that the first balanced
budget agreement in a generation has come about at a time when the
economy is red hot and when joblessness has dropped below 4.9 percent.
The expanding economy has been shrinking the deficit as well as the
gulf between both sides of the budget debate.
Any lingering distance between Congress and the administration was
swept away on the eve of the budget agreement when the Congressional
Budget Office predicted that a tidal wave of new money would flood the
treasury in the next 5 years.
These new CBO estimates project that even without a budget agreement,
increased revenues and decreased outlays would shrink the deficit an
additional $225 billion.
Perhaps even more important than the first balanced budget in a
generation, this tidal wave of new money has washed away the ground
underneath opponents of growth. Nothing signified the victory of growth
over zero-sum, class-warfare politics more clearly than the words of
President Clinton's former Labor Secretary Robert Reich when he told
the New York Times a few weeks ago, ``The fact is, a lot of the deficit
solved itself. It was the one solution that no one thought of.''
Actually, it was the guiding philosophy of the Kemp-Roth tax cut. If
I may quote Jack Kemp, ``Even with spending

[[Page S5043]]

restraint, we cannot balance the budget consistently without economic
growth.''
Mr President, on this point the record is quite clear. Following the
tax cuts in the early eighties the economy did soar. But so did the
deficit. The problem was, while revenues to the Federal Government
doubled during the decade, spending more than doubled.
In short, growth did its job--we just asked too much of it. The
amount of wealth produced by our country was astounding and continues
to be astounding. However, it is not limitless. So neither can our
spending be limitless.
We can protect the elderly and offer a helping hand to the poor, but
only with solid growth in the economy. Without growth, the poor and
elderly are pitted against each other in competition for meager
resources, while the rich are vilified for their success. Left
unchecked, these battles corrode the American dream.
Mr President, I believe this budget represents a new coalition, bound
by the common objective of higher growth. Because growth is the key to
funding worthwhile social programs without unfairly burdening middle-
class families. It is the key to providing a strong defense and a clean
environment. It is the key to rebuilding the American dream.
Growth has won the debate because it has proven itself. Even the more
ardent opponents of growth oriented policies must realize that to raise
$225 billion from taxpayers would require a typical middle-class family
to pony up an additional $450 per year
Some will argue that the huge Clinton tax increase of 1993 is
responsible for the low deficit, high growth, low unemployment economy
we now enjoy. But that ignores the fact that this economic expansion
began during the Bush administration. Others say it is the information
age, along with deregulation and corporate restructuring that
strengthened our economy.
Regardless of who is right, and I do have some thoughts on the
subject, I relish such a debate about the connection between taxes and
growth. What is no longer debatable is that growth is the key to higher
income for all Americans as well as higher revenues for the Federal
Government.
Look how far we have come in just 5 years. When President Clinton
took office, he offered a $19 billion dollar stimulus package
predicated on the notation that private enterprise could not produce
the jobs our country needed. We no longer harbor fears about the
ability of America to produce for her citizens.
Some make the point that this budget will only be balanced for 5
years. And this is true. It is also true that we face additional
challenges beyond 2002 in both Social Security and Medicare, especially
when the baby boom begins to retire. But the seeds of a solution to
these long-term problems can also be found in this budget. Explicitly
it restrains spending. Implicitly, it acknowledges that growth is the
key to finding revenue for popular programs.
Both sides of the American political conversation are now committed
to playing within the bounds of fiscal restraint, while searching for
ways to promote growth. This formula has served us well in the past and
it will serve us well in the future.
The old bromide is true. A rising tide does lift all boats. And the
same tidal wave that has lifted millions of Americans to unprecedented
new heights of prosperity in the past 6 years has also finally sunk
that leaky old boat, class warfare.
There are only two roads we can travel. One is to downsize the
American dream and learn to live in a slow growth world; the other is
to grow the economy up to level that makes the American dream possible.
With this budget agreement, Congress and the President have decided its
better to grow up.
Ms. MIKULSKI. Mr. President, I rise in support of the budget
resolution. I support this resolution for two reasons. First, it
continues the progress we have made since 1993 in moving toward a
balanced budget. Second, it protects priorities which are vital to our
Nation's future.
It is not a perfect plan. There are parts of it that give me serious
pause. I am especially concerned by the deep cuts in Medicare. I know
that this budget resolution only provides a blueprint for other
committees to follow. So, I reserve the right to vote against the final
Medicare package if the cuts threaten health care for our senior
citizens.
With this resolution, we are finally taking the historic step of
balancing the Federal budget for the first time since 1969. In 1993, I
was proud to support President Clinton's economic plan. Since that plan
was enacted, our deficit has been reduced from $290 billion to less
than $70 billion.
The 1993 vote was strong medicine. But it was the right medicine for
our economy. Today, we have an opportunity to finish the job we began
in 1993. We can adopt this resolution which will bring us to a balanced
budget by the year 2002.
But, unlike previous attempts to balance the budget, this resolution
protects crucial investments in our future. Balancing the budget must
be based on principles. First and foremost, it must meet families' day-
to-day needs.
I believe this resolution succeeds in putting families and children
first. It makes major investments in education--from adding 1 million
children to the Head Start Program to making it possible for millions
of students to receive a college education.
This resolution expands health care coverage to 5 million uninsured
children. I want to do more. This resolution still leaves another 5
million children with no health insurance. I am supporting the Kennedy-
Hatch CHILD bill which would make sure that every child has access to
immunizations, early detection screening, and basic health care. I view
the commitment made in this budget resolution to children's health as a
downpayment on the job. I hope we will finish the job by enacting the
CHILD bill later this year.
The bill before us will continue our progress in making our
neighborhoods safe. It ensures that the programs of the 1994 crime
bill, which have been so effective in bring down crime rates, will be
continued.
I am particularly pleased that the budget resolution protects the
violent crime reduction trust fund, including the community policing or
COPS Program. The COPS Program has already put over 1,200 new police
officers on the streets in my State of Maryland.
Under this budget agreement, environmental protection will also be
strengthened. It ensures that another 500 Superfund sites can be
cleaned up by the end of 2000, and provides funding to help communities
clean up brownfield areas so that they can be redeveloped.
Under this balanced budget agreement, we will also be taking
important steps to move people from welfare to work and to provide tax
relief for working families. It will enable us to provide help for
those who practice self help.
As the Finance Committee begins putting together the tax component
outlined in this budget agreement, I hope they make tax relief for
middle income families their priority. I want to enact capital gains
relief. I think we owe it to those who have invested in their community
through purchasing and maintaining a home. They should be able to
realize the full gain on their investment, and not have it taken away
through capital gains taxes.
I hope we can do something to provide capital gains relief for other
types of investments as well. I believe that the longer you hold an
investment, the less you should pay in capital gains. That rewards
those who invest in our economy for the long run, without rewarding
those who are just out to make a fast buck.
I want us to have estate tax relief, so that a car dealer in
Frederick can pass on the business to the next generation, or a small
family farm in western Maryland or the Eastern Shore can stay in the
family.
I hope the Finance Committee will put together a tax package that
puts families first. If the tax package is unfairly tilted toward the
well-to-do, I will oppose it.
Although I will support this budget resolution, I must be clear that
there are parts of it that give me great pause. I am particularly
troubled by the $115 billion in cuts in the Medicare Program. If we
were given the opportunity to vote separately on each of the major
components of this package, I would oppose the Medicare component.

[[Page S5044]]

In the last Congress, when the majority party was attempting to push
through $270 billion in cuts to the Medicare Program to provide tax
cuts for the wealthy, I opposed them. I said at the time that we did
not have a $270 billion solvency problem in the Medicare Program,
rather we had a $89 billion solvency problem. I was joined by the
majority of my Democratic colleagues in that point.
So to see a resolution which calls for $115 billion in cuts to
Medicare is of deep concern to me. I acknowledge this is much better
than plans that were before us over the last 2 years. However, I am
still concerned about the impact on seniors and on health care
providers of this magnitude of cuts.
I realize that the budget resolution does not cut a single dollar
from the Medicare Program. It only provides a guideline for the
authorizing committee to follow. We are a long way from making any
actual changes in Medicare. So I hope that the Finance Committee will
exercise extreme care in crafting the Medicare piece of the budget
reconciliation bill. I believe we can ensure the solvency of Medicare
without creating a financial burden for seniors or providers.
Let me acknowledge one final area of concern. America owes a special
debt to our veterans. We have a sacred commitment to honor all of our
promises to them. I want to ensure that we provide adequately for
veterans' health care.
I am pleased that we passed an amendment to express the sense of the
Senate that we must provide sufficient funding for veterans programs
and benefits. This amendment includes language to urge that third party
payments--that is, payments from private insurers--be used only to
supplement, not supplant veterans health care funding. It makes clear
that the Senate intends to keep our faith with America's veterans. I
won't stand for anything less than that.
Despite these reservations, I will support this resolution. It plots
our course toward a balanced budget and puts families and children
first. I believe this budget resolution will make a real difference in
the lives of working Americans, and I will support it as a framework
for future action.
Mr. ENZI. Mr. President, I rise in opposition to Senate Concurrent
Resolution 27, the Budget resolution. The budget resolution before us
has gone through an incredible amount of negotiating to get to this
point. I commend the Budget Committee chairman and the ranking member
for working so diligently on this budget.
As we began our work on the blueprint for our Nation's future, I had
certain criteria in mind the budget resolution had to meet in order for
me to support it. Unfortunately, this budget does not meet enough of my
criteria to justify my support.
I would like to take this opportunity to explain my position and
those provisions which I feel leaves this agreement short of the mark.
I feel that a good budget agreement should balance the budget before
the year 2002. The Congressional Budget Office estimates a $225 billion
windfall of unexpected revenues over the next 5 years. We should be
giving this unexpected revenue back to the American people and use it
to reduce the deficit.
It also concerns me that there are no enforcement measures in place
to ensure that the budget will remain in balance after the year 2002,
let alone before that.
Finally, the spending cuts are back loaded in the last 2 years of the
agreement, and will take place after President Clinton leaves office.
That isn't right. I believe the American working families expect action
from us today--not promises for a better tomorrow.
I voted for amendments that I felt would make the budget more
enforceable and realistic. Without these meaningful amendments, the
resolution does not go far enough. The amendments would ensure that the
debt limit would not be increased, and that these additional unexpected
Federal revenues and the projected $225 billion revenue windfall would
go toward tax cuts and deficit reduction.
If we don't produce a balanced budget, we lose, and generations to
come will lose right along with us. A balanced budget only gets more
difficult to achieve the longer we wait.
If we are genuinely concerned about the welfare of our children, we
should first look at balancing the budget while it is still realistic
and possible for us to do so. The longer we wait the more we turn our
children's dreams and hopes for a brighter future into a terrible
nightmare. They look to us for leadership. They look to us to pass a
budget that actually balances, and continues to balance the budget
every year. I have no intention of letting them down.
I yield the floor.
Mr. LEVIN. Mr. President, the budget resolution which the Senate is
now considering represents the next step forward in a process begun in
1993. It reflects a considerable bipartisan accomplishment of the
congressional leadership and the President. While I don't agree with it
in every specific, it represents the best opportunity to reach a
balanced budget by the year 2002, in a way which protects Medicare,
Medicaid, funding for education and environmental protection.
In 1992, the deficit in the Federal budget was $290 billion which
represented 4.7 percent of the gross domestic product. The most recent
estimate of the deficit for fiscal year 1997 is $67 billion,
approximately eight-tenths of one percent of the gross domestic
product.
Over the 5 years from 1993 to 1998, the deficit has been reduced by
about 1 trillion dollars from the deficit for those 5 years projected
at the time. This remarkable progress has come about in large part as a
result of the deficit reduction package which President Clinton
presented in 1993, and which this Senate passed, without a single
Republican vote, by a margin of one vote, the Vice-President's.
The economy has responded to the steady reduction of the deficit. The
economy grew for the first quarter of 1997 at a 5.6 percent rate, with
an inflation rate of 2.7 percent. The unemployment rate is now 4.9
percent, the lowest in 24 years. This compares to an unemployment rate
in 1992 of 7.5 percent. More than 12 million new jobs have been created
since President Clinton took office. Now, this budget agreement,
reflected in the budget resolution before us, holds the promise of
bringing us even closer to finishing the job.
This budget gets many of the nation's priorities right. It protects
Medicare and Medicaid--while assuring the solvency of the Medicare
trust fund for another decade--it includes an important new initiative
for children's health insurance, assures necessary funding for the
protection of our natural environment, and perhaps most importantly, it
includes the largest increase in investment in the education of our
children in over 30 years. The agreement includes the commitment to
pass $35 billion of postsecondary education tax cuts and funding for
the President's initiatives in child literacy, school technology, Head
Start, and an increase in the maximum Pell Grant to $3,000. Overall,
this represents a 13 percent increase over the five years of the
budget, and a 36 percent increase in education and training from last
year's budget resolution.
Mr. President, the resolution before us also makes room in the budget
for $250 billion in net tax cuts over the next 10 years, and $85
billion in net tax cuts over the next 5 years. This could provide an
opportunity, within the confines of a budget which balances in 2002, to
provide investment in our Nation's future growth and tax relief to
middle income families. This will require, however, that the Congress
show the discipline and the determination to shape the tax legislation
which this budget resolution will make possible in such a way as to
meet these objectives.
Toward that end, providing they are part of a real package that gets
us to a zero deficit by 2002, I intend to support the education tax
cuts which the President has proposed, a $500-per-child tax credit
adequate to provide tax relief to middle income families with children,
and capital gains relief for homeowners. Also, I believe that, if
consistent with the deficit reduction goals laid out in the resolution,
that targeted capital gains relief for long-term investments and an
incremental approach to estate tax relief should be used.
We must be careful, as we stand on the threshold of a balanced
budget, not to set in motion tax policies which will create large
deficits in the next decade.

[[Page S5045]]

For that reason, I hope that the tax-writing committees will consider
tying tax reductions to actually accomplished milestones of deficit
reduction.
Second, we must carefully study the effect of any tax provisions
which we include in the final tax reconciliation legislation to assure
that it is fair, and not weighted to benefit those who need it least.
Many of the capital gains and estate tax proposals which we have seen
proposed over the last several years would clearly have mostly
benefited the top 10% of income earners.
The budget resolution before us leaves great flexibility to the tax-
writing committees, and ultimately to the House and Senate to fashion
an equitable tax bill that provides not only tax relief, but investment
in our nation's future, particularly through education. Also, and very
importantly, the resolution provides for the tax provisions to be
considered separately in a reconciliation bill after the other elements
of the balanced budget have been enacted. This will provide the Senate
with the opportunity to reject a tax bill which is inconsistent with
balancing the budget and keeping it balanced in the years beyond 2002,
and/or a tax bill which does not focus its relief on middle-income
families and investment in education. It will also provide the
President with the opportunity to veto such legislation. While I hope
that course will prove unnecessary, it does provide greater assurance
that the budget agreement that we will soon ratify in this budget
resolution will produce an outcome of which we can be truly proud.
Mr. President, I want to commend all of those who worked to produce
this bi-partisan budget resolution. It is with hope that we are finally
approaching a balanced budget which protects the nation's priorities
that I will support this resolution.
Mr. FRIST. Mr. President, I rise today in support of Senate
Concurrent Resolution 27, the 1998 concurrent budget resolution, which
outlines the bipartisan budget agreement between the President and the
Congress. While I acknowledge the legislation's shortcomings, I support
the overall agreement because it is a step in the right direction for
our country.
Before I begin, I want to commend Senator Domenici and the other
negotiators for their tireless and unwavering commitment to reaching
this agreement. Their leadership serves the American people well.
Today, this bipartisan balanced budget resolution fulfills a series
of promises that we made to the American people. We promised to pass a
balanced budget by 2002--reflecting our commitment to economic growth,
fiscal responsibility, and the simple principle that our Government
should live within its means. Today, the plan before us will achieve
that goal. We promised to strengthen Medicare--reflecting our
commitment to the health care of senior citizens. Today, the plan
before us will extend the solvency of Medicare's part A hospital
insurance trust fund for 10 years and make structural reforms that will
preserve the program in the future.
We promised tax relief to help families and promote economic growth--
reflecting our belief that the American people, rather than the Federal
Government, should make decisions about how to spend, save, or invest
their hard-earned income. Today, the agreement before us includes $250
billion in permanent tax cuts over 10 years including a $500-per-child
tax credit, capital gains relief, death tax reform, expanded individual
retirement accounts [IRA's], and education tax incentives. For every $1
in new spending, we cut taxes $3.50.
We also promised to reduce the size and scope of the Federal
Government. Today, the agreement before us reduces total Government
spending $320 billion over 5 years and more than $1 trillion over 10
years. That's savings of $1,200 over 5 years and $3,800 over 10 years
for each man, woman, and child in America. In fact, for every new $1
added to this budget, we reduce spending $15.
In constructing this budget, we promised to reject gimmicks and rosy
economic scenarios in our assumptions. Unlike the President's past two
budgets, the agreement before us does not include mechanisms that
automatically and arbitrarily impose one-time spending cuts or tax
increases to eliminate budget shortfalls. It is also based on the
conservative economic assumptions of the Congressional Budget Office
[CBO], which forecasts economic growth even more conservatively than
most private economists at about 2.1 percent annually over the next 5
years. We chose these assumptions so we could err on the side of
caution.
However, even the most conservative assumptions involve a
considerable degree of uncertainty. Forecasting the performance of a
multi-trillion-dollar economy is far from an exact science. I believe
we have done the best we could with the information we have available.
But if the agreement does not produce the expected results due to
unforeseen circumstances, I will not be discouraged as long as we
maintain our focus on a balanced budget and fiscal responsibility.
Finally, we promised to reject rhetoric and partisan rancor to work
together--Republicans and Democrats alike--to achieve results for the
American people. In this spirit, we have worked to accommodate the
President's priorities, and he has worked to accommodate ours. Today,
the agreement before us is the product of countless hours of
negotiations between a Democratic President and a Republican Congress.
I hope we can continue working in a bipartisan manner.
Mr. President, I cannot express my support without also outlining my
concerns in four particular areas. First, this agreement does not
adequately restrain long-term entitlement spending growth to prepare
for the Baby Boomers' retirement just over a decade away. In fairness,
the authors of this agreement do not claim that it does. But as we
approach this new demographic era, we must be acutely aware of this
situation.
Today, 200,000 Americans turn 65 every year. By 2011, 1.5 million
Americans will turn 65 every year, a trend that will continue for 20
years. As the elderly population increases, our younger working
population will shrink. Today, there are 4.9 workers paying for every
retiree's benefits in programs like Social Security and Medicare. In
2030, when we will have many more retirees to support, there will only
be 2.8 workers to support each beneficiary.
This dramatic demographic shift will bring significant economic,
political, social, and cultural changes that will transform our
society. If we continued on our current spending course, entitlements--
our automatic spending programs--and interest on the debt would consume
all federal revenues in just 15 years--leaving not a single dollar for
roads, education, national parks, medical research, defense, or other
basic government functions. I believe this agreement will help ease
this demographic pressure, but more work lies ahead. We must begin
sooner rather than later to deal with these problems fairly and
effectively.

This week, I joined with Senator Kerrey in offering a Sense of the
Senate amendment on the need for entitlement reform. Specifically, it
encouraged Congress and the President to work to enact structural
reforms in entitlement spending in 1997 and beyond which sufficiently
restrain the growth of mandatory spending in order to keep the budget
in balance over the long term, extend the solvency of the Social
Security and Medicare trust funds, and to avoid crowding out funding
for basic government functions, and that every effort should be made to
hold mandatory spending to no more than 70 percent of the Federal
budget. I am pleased that the Senate adopted this amendment
unanimously. While a Sense of the Senate amendment is not binding, I
believe it will help lay the foundation for more substantive reforms in
the future.
Medicare is my second concern. As the second largest entitlement in
the budget serving more than 38 million seniors, Medicare will have a
profound impact on our long-term fiscal health. When we consider that
the average two-earner couple receives $117,000 more in benefits than
they paid in taxes and premiums and factor in that Medicare is
projected to be bankrupt before the baby boomers retire, we see the
urgent nature of this problem. While I am encouraged by the bipartisan
attempt to modestly restrain Medicare growth, we must redouble our
efforts to save and strengthen this vital program through true
structural reform.

[[Page S5046]]

In addition to the demographic pressures outlined earlier, Medicare
also faces the challenge of delivering 21st century health care through
a bureaucratic 1960's delivery system. Clearly, piecing together fair
and balanced policy options that achieve the required $115 billion in
savings should not be our only goal. Working within the framework of
this budget agreement, Congress should adopt structural reforms that
tailor the program specifically to seniors' needs.
These reforms should give beneficiaries more choices among competing
health plans--similar to the ChoiceCare proposal introduced by Senator
Gregg and my Provider Sponsored Organizations [PSO] bill--while
retaining the current fee-for-service option for any senior who wants
it. With these options, seniors could choose a plan that covers
prescription drugs, a benefit not available under the current program.
We also need to educate our young people about the benefits of long-
term-care insurance. By changing the structural dynamics of the system,
we truly can prepare Medicare for the challenges that await us.
My third concern involves our investment in research and development.
Advances in technology have been responsible for one-third to one-half
of our long-term economic growth through improved capital and labor
productivity and the creation of new products and services. Despite
this important relationship, our Federal investment in research and
development has been falling as a percent of our gross national product
[GNP] compared to other advanced nations. Unfortunately, this budget
agreement does not reverse this troubling trend.
While some research and development investments such as the National
Institutes of Health [NIH] and the National Science Foundation [NSF]
are protected, many others are cut. Total Federal research and
development funding could fall up to 14 percent over the next 5 years.
As a percentage of GNP, it will have dropped more than 30 percent from
1994 to 2002. As a research scientist and chairman of the Commerce
Science, Technology, and Space Subcommittee, I believe that
underfunding research and development risks our national security and
our economic competitiveness. If this trend continues, we will be
retreating from investments with a proven record of returns that have
made us healthier, wealthier, more productive, and more secure than
almost any civilization in world history.
Finally, my fourth concern is education. Time after time in this
Chamber, we have stressed the importance of a balanced budget to our
children. With a balanced budget, they can leave the deficit spending
of the past behind and look forward to a future of better economic
opportunities. To take advantage of these opportunities, our children
will need a quality education. I am pleased that education is a
priority in this agreement. However, we are not targeting our resources
where they are needed most--elementary and secondary education.
In the President's budget, about 85 percent of the new education
spending and tax initiatives are directed toward higher education. This
budget agreement is structured in a similar way. These facts are
troubling when you consider that only 28 percent of fourth graders are
proficient in reading, only 21 percent of eighth graders are proficient
in math, and about 30 percent of college freshman must take remedial
coursework.
Our higher education institutions are the envy of the world, but
without a stronger K-12 education system, this academic superstructure
rests on a foundation of quicksand. I am concerned that our academic
success will not last if we do not target our resources where there is
the greatest need and greatest potential. Ultimately, we should
consider targeting at least 50 percent of new education resources
toward elementary and secondary education in the future. I urge my
colleagues to focus more on this problem.

Mr. President, as I have mentioned, my vote today is not the final
solution to our budget problems. My vote today is merely a down payment
on a long-term commitment to my constituents in Tennessee and to all
Americans--a commitment to fiscal responsibility.
The issues raised by this agreement will not disappear if this
resolution passes. In fact, we will debate them again and again this
year as we implement the agreement in the appropriations and
reconciliation process. However, we can build on the momentum of this
agreement to recommit ourselves to the discipline and diligence
necessary to free our children from debt and unlock the doors of
economic opportunity for our future. I look forward to meeting this
challenge.
Ms. MOSELEY-BRAUN. Mr. President, today the Senate will vote on the
blueprint our nation will follow to reach fiscal balance by the year
2002. I commend the efforts of the President and the Congressional
leadership to reach this agreement. It is clear that unless we get our
deficit under control, we will be leaving our children--and our
children's children--a legacy of debt that will make it impossible for
them to achieve the American Dream.
This budget resolution reflects public opinion. This is a bipartisan
agreement because of clear public opposition to continued deficit
spending.
Although the deficit has been reduced in the past few years, our
Nation's debt still obscures our ability to focus on the issues that
most impact Americans' daily lives. The deficit under President Carter
was $73.8 billion when he left office. Under President Reagan it
ballooned to $221 billion, and reached $290 under President Bush. When
President Clinton took office, he inherited a $290 billion deficit. The
national family was in debt $4.4 trillion.
Under President Clinton's leadership, however, the deficit has been
reduced to $67 billion, the lowest nominal level since 1981. During the
Bush administration, private sector growth averaged 1.3 percent
annually, but under President Clinton, growth has averaged 3.5% per
year. Furthermore, last year's deficit was 1.4 percent of the size of
our economy, well below the deficits of other major economies, and the
smallest level since 1974. This year, it will fall to about 1 percent
of the economy.
President Clinton's 1993 economic budget plan gave the signal to the
world's financial markets that Democrats were committed to fiscal
responsibility and that we would put our country on a glide path to
balance. Our Nation is now in our 6th straight year of economic growth.
Unemployment was 7.5 percent in 1992. Last month it fell to 4.9
percent, the lowest level in a quarter century.
During the first quarter of this year, the economy grew at an annual
rate of 5.6 percent, the best in a decade. And since President Clinton
took office, more than 12 million new jobs have been created.
The best news about this resolution is that it continues the trend
begun in 1993: this budget makes strides toward balance. Balance was a
precondition of this agreement. While I regret that we did not pass a
balanced budget amendment to the Constitution, the proof of the pudding
is in the eating: the President and congressional leaders have reached
a consensus and agreed that this budget should reach balance in the
year 2002. And this budget has achieved that.
Mr. President, an area where the nation has reached a consensus is
tax cuts. Everybody likes tax cuts. Public opinion is always in favor
of tax cuts and this budget resolution provides for a net tax cut of
$85 billion over 5 years.
The tax cuts include: a child tax cut; about $35 billion in higher
education tax cuts; a capital gains tax cut; a cut in the estate tax;
and a variety of other tax proposals included in the President's
budget, including the welfare-to-work tax credit.
But this budget resolution only outlines the overall framework of the
budget. The tax cuts that were agreed upon must be finalized in
reconciliation in the Finance Committee. But these are the likely ones.
While I support the concept of these proposals, I would have
preferred to finish balancing the budget first.
Mr. President, the budget resolution also reflects the popular
support for health care and Medicare. And the changes contained in the
Medicare Program will not hurt seniors.
The agreement calls for $115 billion in Medicare savings, keeping the
Medicare trust fund secure for another decade. It expands seniors'
choices of private health plans by allowing preferred provider
organizations and provider-sponsored plans to compete in Medicare's
managed care program.

[[Page S5047]]

Furthermore, this agreement will make some fixes to the Medicaid
Program. While the resolution does not contain a per-capita cap, which
would have hurt Illinois, it calls for $13.6 billion in net Medicaid
savings. It restores Medicaid coverage for certain legal immigrants. It
provides food stamps to individuals subject to last year's welfare
reform bill time limits, who are seeking work but have not been able to
find a job. And it provides a welfare-to-work initiative.

The other good news is that this budget also provides for: expansion
of the funding for Superfund hazardous waste cleanups; help up for to
five million children, who currently lack health insurance, receive
health insurance coverage by 2002; and it provides for the largest
increase in education spending in 30 years.
This budget resolution does however, contain a few disappointments.
It does not come to grips with the fundamental challenges our Nation
faces in the coming years. Instead of confronting these challenges and
taking steps to meet them, it is the budgetary equivalent of the scene
from ``Casablanca'' when Claude Rains says ``Round up the usual
suspects.'' In this case, the ``usual suspects'' are domestic
discretionary spending and cuts in reimbursements for Medicare and
Medicaid health providers.
Like Captain Renault, this agreement is more concerned with the
appearance of action than with actually achieving something. And unlike
the situation in ``Casablanca'', where the captain's inaction produced
a good result, the failure to address our fundamental retirement
security and investment challenges now, makes the future more difficult
for all of us.
Since 1991, discretionary spending has remained relatively flat.
While the President has resisted deeper cuts this year, this budget
resolution nonetheless short-changes domestic spending. The agreement
cuts investments in non-defense discretionary programs by at least $61
billion below the level needed to maintain the current level of
services. This agreement represents roughly a 10 percent cut in real
terms in non-defense discretionary programs. This translates into less
money for cops on the streets, less money for sewers, and less money
for our highways--fundamental public investments needed to keep our
country strong.
The squeeze is being put on discretionary funding to pay for tax
cuts. Furthermore, nothing is being done to address entitlement
spending. This budget resolution does nothing to address the ominous
long-term issue facing our country: changing demographics and its
effect on our ability to maintain retirement security for future
generations.
I was a member of the Bipartisan Commission on Entitlement and Tax
Reform. The Commission made it clear that unless we get the deficit
under control, by the year 2003, mandatory spending--most of which goes
to Medicare and Social Security--plus interest on the national debt,
will account for fully 73 percent of the total Federal budget.
Though the current economic news is generally good, and the economy
continues to expand, this trend may not continue. The Congressional
Budget Office's report entitled ``The Economic and Budget Outlook:
Fiscal Years 1998-2007,'' points out that ``Despite the improved
outlook through 2007 . . . the budget situation will start to
deteriorate rapidly only a few years later with the retirement of the
first baby boomers and the continued growth of per-person health care
costs.''
By the year 2012, the Social Security trust fund will begin spending
more than it takes in. And by the year 2029, the trust fund will have
exhausted all of its resources. After 2012, when there are no more
surpluses, Federal deficits will really begin to explode, an explosion
fueled by the looming retirement of the baby boom generation.
The fact that for the next 15 years Social Security will be running a
surplus, works to disguise the extent of the problem, as does the fact
that the retirement security budget is currently roughly in balance.
Social Security and Medicare payroll taxes, Medicare part B premiums,
and interest earned by the Social Security and Medicare trust funds
roughly equal the spending by those two programs, at least for the
moment.
The long-term prognosis, however is nowhere near as favorable and the
problem with this budget resolution is that it does nothing to address
these problems now, while there is still time. Granted, the proposed
set of Medicare reductions will extend the solvency of the trust fund
until 2008. There are also some true systematic reforms to the Medicare
Program that will move many of the program features toward prospective
payment systems.
However, this is not nearly enough. This budget resolution does not
even extend the Medicare Program solvency to the year 2010 when the
baby-boom generation begins to retire. Think about this: Currently, 13
percent of the population is over age 65, and that number will double
by the year 2030. The problem of fixing Medicare for the long run is
only going to get more difficult. If we wait until the next millennium
to deal with Medicare, it is going to take a lot more than $115 billion
over five years to fix the problem. If we want Medicare to exist for
our children and for many of us, we have to seize this opportunity to
overhaul the program in a long-lasting way.

Equally depressing is our complete ignoring of needed Social Security
reform. There has been a lot of talk over the last few years about tax
cuts and the need to give Americans some relief from the burden of
excess taxation. As you may know, 70 percent of Americans pay more in
payroll taxes than income taxes. The average worker retiring in 2015
will pay $250,000 in payroll taxes over her working career.
People pay these taxes into a system that they believe will provide
them with some measure of retirement security. They expect Medicare to
be there to cover health care costs and they expect Social Security to
be around to provide a measure of income support. Eighty percent of
Americans get more than 50 percent of their retirement income from
Social Security.
The Social Security system, just like Medicare, is not prepared for
our future changes in demographics. Current retirees can expect to get
back in benefits what they paid in taxes plus interest within eight
years.
For the vast majority of past and current retirees, Social Security
has been a great value. They paid into the system with the promise that
when it was their turn to retire, Social Security would be there. Well,
the outlook is not as good for future generations of retirees. Already,
the probability of getting back what they will pay into the system is
diminishing. In the year 2015, it will take the average worker 13 years
to recover what he pays in payroll taxes.
This already eroding value of Social Security is compounded by the
facts that we are planning to reduce the consumer price index which
will lengthen the time it takes to recoup taxes and even more
problematic, the trust fund is expected to become insolvent in 2029.
A lot of work has been left undone by this budget resolution. This
resolution does not even begin to make the reforms necessary to ensure
that the next generations of Americans can retire with the same dignity
as their grandparents and parents. Cutting $115 billion from Medicare
is simply a quick fix to get past the initial 2001 exhaustion date.
Future seniors should not have to worry about whether Medicare will pay
their doctor's bill or whether their Social Security check will arrive
on time.
Mr. President, I was particularly disappointed that this proposal did
not invest in education infrastructure. It is a sad fact of life that
in thousands upon thousands of classrooms all across the country, our
schools are not physically up to the task of educating all Americans
for the 21st century. Too many of our schools are literally falling
down around our children.
Too many of our schools are overcrowded to the point where students
cannot learn effectively. Too many of our schools do not have the
physical infrastructure necessary to support the integration of
computers into classrooms.
According to the U.S. General Accounting Office, which at my request
conducted an intensive, 2-year study of the condition of America's
schools, 14 million children attend schools in such poor condition they
need major renovations or outright replacement; 7 million children
attend schools with life-

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threatening safety code violations; and it will cost $112 billion just
to bring schools up to what the GAO calls good, overall condition--in
other words--up to code. This budget resolution does nothing to address
these concerns.
Mr. President, education does not just provide benefits to
individuals. Education benefits the public. Every single American
benefits from improvements to our elementary and secondary education
system.
It is unfortunate, then, that we continue to pay for our education
system as though its benefits were individual and local in nature. In
order to remain the world's economic leader, we must reform our
education funding system that was designed to meet the needs of
yesterday's economy.
Our reliance on local property taxes to pay for elementary and
secondary education causes wide disparities in the abilities of school
districts to adequately fund education. Under our current system,
wealthy communities with low tax rates can often generate sufficient
revenues to build the finest facilities, while poor communities with
very high tax rates often cannot raise enough to support even mediocre
schools. While many poor districts try their hardest, and have the
highest tax rates, the system works against them.
According to the U.S. General Accounting Office, poor and middle-
class school districts in 35 States make a greater local tax effort
than wealthy districts. In my home State of Illinois, the poorest
districts tax themselves at an average rate of 43 percent higher than
the wealthiest districts. This phenomenon is our school finance
system's greatest irony: the lowest-income areas often have the highest
property tax rates and the schools with the fewest resources.
The GAO found that although most states make some attempt to
supplement local funding in poor districts, wealthy school districts in
37 states have more total funding per pupil than poor districts. These
disparities exist even after adjusting for differences in geographic
and student need-related educational costs. In Illinois, the wealthiest
20 percent of districts have almost two-thirds as much to spend per
pupil than the other 80 percent.
Because we rely on the local property tax to fund education, the
opportunities available to our children are subject to the vagaries and
disparities of local property wealth. Children in wealthy communities
are able to attend the best schools and have the most opportunities,
while children in poor and middle-class communities often have access
to second-rate facilities and lesser opportunities. This budget
resolution does nothing to reverse these trends.
In conclusion, I believe that our Nation's budget, reduced to its
essentials, is very much like the budget of any family. It should
balance revenues and spending, it should address the needs and
priorities of the various family members, it should be fair in the
apportionment of spending and sacrifice, and it should lay a foundation
for the future well-being of its members.
It should address the looming needs of the American family,
especially in regards to health care and retirement security, as well
as reinvestment in the infrastructure which is in progressively worse
shape.
The agreement reached can be thought of as a decision to pay off
some, but not all, of the old bills, to give more support to a variety
of family activities, and to give up a part time job. Because the
economy is so robust, those decisions represent the cashing in of a
prosperity dividend.
Mr. President, Congress must not only look at the 5 and 10 year
effect of the policies we enact. We need to look at how the policies we
change today affect the future. It is true that long-term economic
estimates are notoriously unreliable, but having said that, long-term
budget problems are in no small part related to long-term demographic
trends. And long-term demographic trends are reliable.
Our actions now will impact future generations, our grandchildren.
For example, if Social Security were examined under the requirements of
private pension funds, you would find that it is underfunded by
hundreds of billions of dollars. Congress should look outside the
budget horizon, particularly at the long-term budgetary consequences of
tax cuts. Tax cuts are back-loaded in this resolution.
Mr. President, in Alice in Wonderland, Alice asked the Cheshire Cat,
``Which way should I go?'' And the Cheshire Cat responded ``It depends
on where you want to go.'' Congress must decide which way to go. Mr.
President, this budget resolution will balance the budget. But more
work needs to be done to meet our obligations to future generations of
Americans, to invest in people and to protect their retirement
security. Every generation of Americans has addressed and resolved
challenges unique to their time. That is what makes our country great.
Now is the time to take steps toward ensuring that our generation will
honestly address its needs so that future generations will have at
least the same opportunity.
Our generation should leave no less than we inherited.
Mr. SMITH of New Hampshire. Mr. President, I rise to voice my
concerns about the budget resolution we debate here today. Since the
announcement of a budget deal earlier this month, I have carefully
examined the plan, contemplated its effect on our economy and the
future of our children, and pondered the advice of many. I have also
observed the floor debate and statements of my colleagues, and have
heard the views of many of my constituents in New Hampshire. After much
deliberation, I must oppose this budget.
While I do not support the resolution, I would like to commend my
colleagues who have worked so hard to try to craft a good plan. I
appreciate their efforts and the difficult discussions they have
endured. Most importantly, I realize that negotiating with the White
House is no easy task. However, my concerns about the deficit, the
exploding growth of entitlements, and the huge tax burden on Americans,
far outweigh the temptation of a politically appealing agreement with
the President. History has taught us that the most politically
expedient solution is not always good for Americans.
What happened to the Republican Congress that came into town in 1995,
ready to attack the problems in our economy that had been ignored for
decades? Where is the spirit of dedication that accompanied our success
and the commitment to our principles that led to our win? Where are
those voices that denounced Washington's business as usual? I cannot
answer these questions, but I do know that we should not disappoint the
voters who trusted us.
For a minute, allow me to set aside the rhetoric that surrounds this
debate and look at the facts. Fact 1: Under the plan, the era of big
government is not over. This budget deal proposes to spend $5 billion
more than even President Clinton requested for fiscal year 1998. In
fact, spending for 1998 increases about $70 billion from 1997--a bigger
increase than any budget passed by Democrat-controlled Congresses in
recent years. Over 5 years, this plan spends $189 billion more than
Congress proposed in last year's budget resolution. The so-called
savings that have been celebrated by proponents are just reductions
from the inflation-adjusted baseline that rises each year.
Fact 2: All the pain is in the out-years. Since Congress revisits the
budget resolution every year, we cannot count on anything past 1998 and
we have no assurance that the cuts in spending will ever be achieved in
2001 and 2002. At the very least, we must cease the fairy tale rhetoric
about savings that will be achieved over the next decade.
Fact 3: The deficit goes up! While the deficit for this year is
projected to be $67 billion, under this plan, it is estimated to grow
to $90 billion for the next 2 years and then drop slightly to $83
billion in 2000. Not until 2001, does the deficit drop to below today's
level. If we can reduce the deficit from $53 billion in 2001 to 0 in
2002, why can't we reduce it by $53 billion this year? Furthermore, the
deficit reduction is due, in large part, to suspicious economic
assumptions. Overnight, the Congressional Budget Office discovered a
$225 billion ``fiscal dividend'' of new tax revenues that may or may
not be realized in the out-years.
Fact 4: The tax cuts will not provide noticeable relief. While we
must vote on the spending increases now, we have but a skeleton of a
commitment on tax relief for Americans--legislation which won't be
discussed until next month. Since we have already promised away

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$35 billion for the President's education credit, the tax writing
committees are left with very little room to accommodate the equally
important capital gains tax reductions, death tax reform, the $500 per
child tax credit, expansion of individual retirement accounts [IRA's]
and other relief provisions. For instance, $100 billion would not even
cover the full $500 credit. These restrictions will produce scaled-
down, phased-in, and barely noticeable adjustments.
Fact 5: The proposal contains no real entitlement reform. This budget
proposes $115 billion in Medicare savings, but does absolutely nothing
to fundamentally restructure the ailing program. In fact, the biggest
reform is an accounting change that we condemned as a ``gimmick'' just
last year--and rightly so. Worse yet, the plan wipes out many of the
real reforms we enacted in last year's welfare reform legislation by
restoring welfare payments to legal immigrants and expanding Food Stamp
work slots.
Fact 6: The budget deal protects additional money for Presidential
priorities, but no programs are terminated. While the resolution
guarantees that spending will go up for programs such as Head Start and
bilingual education, there is not one word about reforming or
eliminating arts funding, AmeriCorps, or corporate welfare programs.
Since total discretionary spending increases in this legislation, I
hold out little hope that wasteful spending programs will be tackled
this year.
A legitimate balanced budget plan should shrink the size of
Government, reduce the deficit, and reform entitlement programs. The
budget must be accompanied by a credible tax package that includes
complete repeal of the estate tax; a 50 percent cut in the capital
gains tax rate; an immediate $500 per child tax credit available to
all, regardless of income; and creation of an ``IRA-Plus'' plan. These
tax cuts should be financed by reducing spending, not increasing other
taxes.
Although this plan contains many serious flaws, it is my hope that we
can renegotiate a plan that meets but one condition: it must be a good
deal for Americans. In its current form, I cannot, in good conscience,
support this budget resolution.
Mr. JOHNSON. Mr. President, I rise in support of Senate Concurrent
Resolution 27, the fiscal year 1998 budget resolution.
Mr. President, this bipartisan budget agreement represents a hard-
fought achievement for our nation. It is neither the perfect plan, nor
is it the plan that I would write if I were solely responsible for this
enormous task. What this plan does represent, however, is a compromise
between two parties, a compromise between Congress and the
administration, and a delicate balance of important national investment
and tax priorities. Under the circumstances, no plan could be perfect.
This plan, nevertheless, is a good plan.
Mr. President, this plan is the culmination of more than 2 years of
debate. During the course of this debate we have witnessed several
critical events: the shutdown of the Federal Government, the death of
the so-called Contract With America, and the emergence of a group of
centrists committed to a sensible approach to balancing the Federal
budget.
In order to understand this agreement in its proper context, we
should take a moment to remember that this agreement today would not be
possible without tough votes cast by Democrats on the Omnibus
Reconciliation Act of 1993. The success of that deficit reduction
package is indisputable. When President Clinton took office in January
1993, the Federal budget deficit stood at $290 billion. Experts are now
projecting a deficit for this year in the range of $67 billion. We have
seen, for the first time in a century, declining deficits for 5 years
in a row, and the deficit as a percentage of the size of the economy is
at its lowest in decades. Not a single Republican supported the 1993
deficit reduction bill. Not one. Yet, without this enormous
achievement, we could not be finishing the job today.
It is also vitally important that we remember the great battle over
the shape of Government that has taken place over the past 2 years. At
the beginning of the 104th Congress, we heard talk of a revolution. We
were told that we needed to cut Medicare by $270 billion over 7 years.
We were told that Medicaid should be reduced by $170 billion, and that
Federal Government would no longer guarantee health care coverage for
the poorest Americans. And we were told that the earned income tax
credit--a program that reduces the tax burden on low- to moderate-
income working families--should be cut by $32 billion. Speaker
Gingrich's revolution also called for massive reductions in
discretionary spending, leading to cuts in critical education programs,
veterans' programs, and environmental protection.
These large-scale reductions would be necessary because Speaker
Gingrich's plan contained a massive tax cut of $280 billion over 7
years. The majority of the tax cuts would be of little benefit to
typical American families. In fact, with the cuts in the EITC, many
families needing the most help would have paid higher taxes.

Democrats knew that there was a better way. We said that we could
balance the budget by 2002, but we had to do it with the right
priorities. We said that we could balance the budget while enacting a
modest package of tax cuts that would be targeted to typical American
families. We said that we could preserve Medicare, invest in education,
and balance the budget. This budget agreement proves that we were
right.
With a better-targeted tax cut package, this agreement allows us to
balance the budget while making investments in critical priorities. The
agreement provides $35 billion in tax cuts for education, funding for
the child tax credit, and still leaves room for relief in estate and
capital gains taxes.
The agreement would increase funding for Pell grants by $8.6 billion
over 5 years. This funding boost would increase the maximum Pell grant
to $3,000--which is a $300 increase--and it would expand eligibility so
that more students can be provided assistance.
The agreement will provide $16 billion over 5 years for innovative
new programs to provide health care coverage for 5 million children who
have no health insurance. This achievement stands in stark contrast to
proposals in the Contract With America that would have removed the
Federal guarantee of health care coverage under Medicaid.
The bipartisan agreement allows for the largest expansion of
education programs since the time that Lyndon Johnson was President.
Head Start will be expanded by $2.7 billion, allowing for 1 million
children to be enrolled in this critical program by 2002. This is a
vast improvement over the Contract With America, which called for the
elimination of the Department of Education, cuts in student loans, and
reductions in Head Start.
The agreement provides for growth in Federal student loan programs,
increasing student loan volume by $7 billion by the year 2002. In
contrast, the Contract With America would have added to student debt
burdens by charging interest while the students were still in school.
The agreement will reform Medicare to extend the life of the Medicare
trust fund for 10 years. Rather than receive benefit reductions,
Medicare beneficiaries will be eligible for new preventive care
benefits, such as mammography coverage, other cancer screening, and
diabetes management.
The agreement will implement President Clinton's proposed budget for
the National Park Service, producing an increase of $57 million over
current budget levels.
The budget plan provides key funding for crop insurance programs,
allocating $200 million necessary from discretionary funds to reimburse
crop insurance agents for the cost of administering the program.
The agreement will fund the President's budget request for tribal
priority allocations, which pay for law enforcement, child protection,
education, and road maintenance on our Nation's reservations. This
provision will boost funding by $200 million for the next fiscal year,
and by $800 million over 5 years.
I do want to take a moment, however, to express my concern that the
tax-writing committees in both the House and the Senate take
considerable care as they fill in the details of the agreement to
reduce taxes by a net $85 billion over 5 years and $250 billion over 10
years. There may be great temptation to structure these tax cuts so
that their full cost to the Treasury is not felt until the years beyond
the 10-year path laid out by this agreement. It would be a grave
mistake, and

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highly irresponsible, to pass into law a tax cut package that could not
be sustained over the long term. Our goal should be to keep this budget
in balance for good. Accordingly, I urge my colleagues on these
committees to keep long-term fiscal considerations in mind.
Mr. President, I want to thank all those on both sides of the aisle
that spent countless hours negotiating this agreement. We have not yet
finished the job, but the passage of this resolution is a crucial step
down the road to balanced budget.
Mr. FAIRCLOTH. Mr. President, I reluctantly have to rise in
opposition to this balanced budget agreement.
Mr. President, this agreement will balance the budget in 5 years.
But, we are already $5 trillion in debt. We can't wait 5 years. We
can't go deeper into debt, just to spend more on domestic programs.
In the last 40 years, the Government has grown too big--it is time
for our national debt to get smaller. In fact, this budget could
actually be balanced by the year 2000 rather than 2002, and still
provide tax relief for working families, were it not for the first 3
years of higher spending which the President insisted upon. I want to
commend my colleagues who negotiated with the President, and I have no
doubt it was difficult to persuade the President to agree to a budget
that ever achieves balance. But I simply cannot support the spending
increases and tax increases in this budget.
If this budget resolution is enacted, spending will grow--that's
right, grow--by $267 billion over 5 years, rising from $1.622 trillion
this year to $1.692 trillion in 1998, $1.753 trillion in 1999, $1.809
trillion in 2001, and $1.889 trillion in 2002. Under this budget deal,
deficits will grow next year alone by 35 percent, from $67.2 billion to
$90.4 billion. In fact, deficits will be above this year's level for
each of the next 3 years. This budget deal allows spending to balloon
over the next 3 years, and it does not begin to control spending until
the year 2001, which of course will be after the end of the President's
second term.
In fact this agreement will actually produce the largest increase in
social spending in the last 15 years.
While we're spending at records levels, the agreement gives little in
the way of tax relief. And much of the tax relief that is provided is
really robbing Peter to pay Paul. The agreement includes a gross tax
cut of $135 billion, but let's take another look at that so-called tax
cut. If you look elsewhere in the agreement, you'll see that it
actually includes $50 billion in new tax increases, including $34
billion in tax increases from the airport and airway trust fund tax.
In addition, the Bureau of Labor Statistics will adjust the Consumer
Price Index downward by 0.25 percent. That's another $6 billion in tax
increases. In other words we are cutting taxes with one hand, and
raising them with another, so the Government can keep spending and
deficits can keep growing.
Most of the deficit reduction in this bill comes not from tough
choices and policy changes that control Government spending, but from
rosey-scenario assumptions made by economists. We are assuming that
economic growth will be strong enough, and inflation will be low enough
that all the hard choices will be taken care off for us. In fact, 99
cents out of every dollar of deficit reduction in this bill is simply
assumed. As my good friend, Senator Gramm has noted, only 1 cent out of
every dollar, or $3 billion out of $350 billion, comes from changes in
public policy.
Congress and the President should tell the American people the hard
truth about the Nation's deficit. A balanced budget requires hard
choices. It cannot be achieved simply by wishing it away.
Even though I cannot support this budget agreement, I must note that
this is perhaps the best agreement that could be achieved, considering
that we have been negotiating with a President who is dedicated to
increasing the size of the Federal Government.
In fact, I find it very instructive to compare this budget agreement
with the budget produced in 1993, when the President and a Democratic
Congress unveiled their own budget plan. That 1993 budget raised taxes
by $241 billion, provided absolutely no net tax relief, and never
achieved balance, but continued deficit spending as far as the eye
could see. The Clinton budget of 1993 provided spending reductions of
$193 billion, as against a net total of $241 billion of tax increases.
The current balanced budget agreement of 1997 provides $320 billion of
spending reductions, and gives the American people a net total of $85
billion in tax relief.
Without the current balanced budget agreement, it is likely that the
Federal Government would face another Government shutdown. This
agreement should prevent that from happening.
Is this a perfect agreement? No, it is not. Unfortunately, no
agreement which attempts to reconcile a philosophy of tax and spend
Government growth with one of tax relief and fiscal restraint is likely
to be perfect. Perhaps it is the best that can be achieved under this
President.
Although it is perhaps the best that Congress can get from this
President, the Nation deserves much better, and for that reason I plan
to vote against the budget agreement. With that, Mr. President, I yield
the floor.
Mr. KYL. Mr. President, Gen. George S. Patton once said, ``if
everybody is thinking alike, then somebody isn't thinking.''
Mr. President, I have no doubt that this budget is going to pass.
There appears to be a lot of sentiment on both sides of the aisle that
the deal must be approved even though it is flawed in many respects.
But, like General Patton, I hope each of us and every American will
actually evaluate the budget agreement on its merits before deciding
whether or not to go along. I, for one, have concluded that the deal--
on its merits--should not be supported, and there are several reasons
why.
First, consider the deficits that are projected under the budget
agreement. The deficit this year is expected to total $67 billion. We
are trying to get a zero deficit--to balance--by the year 2002. But
under this budget, the deficit goes up, not down. It climbs 34
percent--to $90 billion next year--and then remains in that range for 2
more years. Only in the final 2 years of the 5-year plan--in 2001 and
2002--would the deficit drop dramatically.
Think about that. We are at a $67 billion deficit now, and we are
trying to get to balance in 5 years. This budget lets Congress and the
President go on a spending binge for 3 years, and then requires us to
eliminate a $90 billion deficit in just 2 years. It cannot be done.
It is as if you decided to go on a diet and lose 20 pounds by the
Fourth of July. But instead of losing the weight gradually, you decided
to put on 10 more pounds and then started the diet in earnest on July
1. You would fail to achieve your goal. The same is the case regarding
deficit reduction. If it is going to take 5 years to eliminate a $67
billion deficit, how can we possibly eliminate a $90 billion deficit in
just 2 years? The answer is that we will not.
Second, consider tax relief. Of course, the budget itself does not
include a family tax credit, capital gains relief, relief from death
taxes, on an education tax credit. It merely establishes the overall
size of the tax cut that will be written later. But the amount of tax
relief we will be able to provide is very small: a net total of $85
billion over 5 years--about 1 percent of the $8.6 trillion in tax
revenue that will be collected over that time period. A tax cut of 1
percent. It is minuscule.
It is going to be impossible to provide all of the tax cuts that we
have promised within that small amount.
Mr. President, the tax relief we promised to working families--to
help small businesses create jobs and provide better wages--will total
$188 billion alone. President Clinton's education credit will cost
another $35 billion. And there are a variety of other tax cuts as well.
What that means is that a single mother probably cannot count on a
full $500-per-child tax credit. It probably will be something less,
phased in over a period of time. And maybe only some parents will
qualify.
It means that small businesses, including those started by women and
minorities, cannot count on the tax relief that would enable them to
expand, hire new people, pay better wages, and do the things necessary
to become more competitive.

It certainly will not be significant enough to prolong the economic
expansion, which is already reaching historic

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lengths. That means the economy will probably slow, and people would be
hurt be recession. We can prevent that by providing the economy with
the shot in the arm that it needs to keep on growing. But that will
require a larger, more meaningful tax cut.
Third, consider whether or not this budget preserves Medicare for our
seniors today and for those who will count on it in the future. Instead
of going bankrupt in 2 years, this budget lets Medicare go bankrupt in
less than 10 years. We need to make sure Medicare is safe and solvent
for the long haul, particularly when the first wave of the Baby Boom
generations begins to retire in 2010. This budget does nothing to
protect Medicare for the next generation.
It merely delays insolvency, mainly by reducing provider
reimbursements, which will either diminish the quality of care provided
to today's generation of older Americans or drive more doctors and
hospitals out of the Medicare Program altogether, leaving seniors with
limited health-care choices.
It shifts the costs of home health care from part A to part B--a
gimmick that we roundly denounced when the President proposed it
before.
Fourth, consider whether or not this budget makes good on the
President's pledge that ``the era of big government is over.'' It does
not. In fact, there are 13 new mandatory and entitlement programs in
this agreement. And their costs will explode early in the next century.
Fifth, and this may be the most telling of all, to pass this budget
agreement we will first have to waive the discretionary spending caps
for fiscal year 1998 that were established by the Democrat Congress and
the Democrat President in 1993. Outlays will actually exceed the
statutory cap by about $7 billion. In other words, the Republican
majority, which was sent to Washington to try to curb spending, will
allow spending to grow even more than the free-spending Congress of the
early 1990's.
Mr. President, this budget will not produce the intended results. It
merely postpones all of the tough decisions until a new President and a
new Congress are elected early in the next century. It is, as Yogi
Beara once said, deja vu all over again--a remake of the 1990 and 1993
budget deals that simply yielded more spending, bigger government, and
more taxes.
I intend to vote ``no.''
Mr. BYRD. Mr. President, the Budget Resolution before us today is
nothing more than a blueprint that, if implemented in its entirety
through subsequent reconciliation and tax legislation, purports to
balance the federal budget by 2002. Whether or not a balanced budget
will actually be achieved in five years, Heaven only knows. Having said
that, this agreement must nevertheless be recognized as the byproduct
of a reasonable compromise between a Democratic President and a
Republican Congress. Such bipartisan cooperation has not been witnessed
in recent years, when two government shutdowns have highlighted the
paucity of compromise in our federal government.
Mr. President, I would like to commend the leaders from both parties
who have worked hard to forge a balanced-budget agreement that will
likely pass both houses of Congress. However, I also want to remind all
Senators that most of us did not sign the Bipartisan Budget Agreement
announced by the President and the Congressional leadership on May 2,
1997, and we are not thereby bound to its individual components. As
much as we want to jump on this budgetary bandwagon, we must be careful
not to subject this Budget Resolution to any less scrutiny than would
be applied to a strictly partisan budget proposal.
Mr. President, the Budget Resolution before us today purports to
achieve a budget surplus of $1 billion in FY 2002. To accomplish this
task, discretionary spending will be cut by a total of $138 billion
over five years, Medicare and Medicaid will be cut by $129 billion, and
other mandatory programs will be reduced by approximately $40 billion.
In addition, the proposal would amend budget rules to extend the
statutory caps for discretionary spending and the pay-as-you-go
requirements for mandatory spending through 2002. While I am concerned
about the depth of the spending cuts targeted towards discretionary
spending, which has been declining sharply as a percentage of the
federal budget since the 1960's, I cannot ignore the substantial
improvement in discretionary funding that this Budget Resolution
achieves over its immediate predecessors. Furthermore, this plan places
spending priorities on many needed investments in transportation
infrastructure, educational assistance, environmental protection, and
crime-prevention programs.
Mr. President, if the Budget Resolution included only the
aforementioned spending reductions, I would likely be standing on the
floor today declaring my unequivocal support for its passage. However,
the Budget Resolution before us also includes certain provisions that
have nothing to do with balancing the budget. In fact, these
provisions--namely, the $85 billion in net tax cuts included in Senate
Concurrent Resolution 27--take us in the opposite direction and make it
more difficult to balance the budget. In essence, Mr. President, if we
approve these tax cuts, we are with one hand digging deeper the very
hole our other hand is trying so hard to fill. Such ambidexterity
should not be relied upon to balance the budget. We should eschew all
tax cuts until after we firmly erase the budget deficits that have so
plagued our nation in recent years. Tax cuts were, after all, the
primary culprit for the rapid escalation in the federal budget deficit
in the 1980's. It is all too easy to enact tax cuts and save the pain
for later. We have done it before, and the lessons learned from that
exercise should instruct us not to do it again.
Mr. President, some may guarantee that the Budget Resolution before
us today will balance the budget in five years and still provide such
tax relief. If the economy continues to perform at close to its current
pace, that very well may be true. However, if the economy turns sour in
the next five years, the tenuous $1 billion surplus projected for FY
2002 under this Budget Resolution may be worth less than the paper on
which it is printed here today. We may never see that surplus, or
anything close to it, if we combine the contradictory goals of tax
cutting and budget balancing in this resolution. Suppose, for example,
that we provide these tax cuts today and then find ourselves in the
year 2000 well above the deficit targets proposed by this resolution.
Will we be able to repeal these foolhardy tax cuts to bring us closer
to balance? Will we be able to tell those beneficiaries of these tax
cuts to give them up? I have served in this body long enough to
recognize that tax cuts such as the ones included in this Budget
Resolution are virtually a one-way street; there is no turning back. We
should steer clear of this diversion and stay focused on the course of
balancing the budget.

Mr. President, before I conclude my remarks, I want to remind all
Senators of the actions that have helped to bring us to this point,
where balancing the federal budget is well within our reach. According
to the Congressional Budget Office, the FY 1997 budget deficit will be
approximately $67 billion, or less than one percent of Gross Domestic
Product (GDP). Just five years ago, many Senators will remember that we
were facing a budget deficit of $290 billion, or about 4.7 percent of
GDP. This considerable improvement in the fiscal order of our nation
did not occur by accident. Rather, it can be traced directly to the
passage in 1993 of the Omnibus Budget and Reconciliation Act (OBRA-93)
by the 103rd Congress, with the support of President Clinton. That
landmark legislation combined responsible spending cuts and revenue
increases to begin the painful--but necessary--process of eliminating
the deficit. There can be no doubt of the success of OBRA-93 in
bringing down the deficits and stimulating economic growth. We are
currently in our sixth consecutive year of economic growth,
unemployment has dipped below five percent, and inflation has remained
in check. The Budget Resolution before us today continues the task of
balancing the budget from the propitious starting point made possible
by OBRA-93, and it relies on projections of similar economic conditions
in the future. Mr. President, it is safe to say that, were it not for
OBRA-93, the task of balancing the budget by FY 2002 would be
substantially more difficult, and the Budget Resolution before us today
would not come close to balance.

[[Page S5052]]

After discussing what actions have made this Budget Resolution
possible, however, I believe it is also important to focus on what
actions were not needed. Specifically, I am referring to the proposed
constitutional amendment to balance the budget, which was again
defeated earlier this year. Without constitutionally tying the hands of
this and future Congresses, the leaders of the Congress and the
President have come together to forge a balanced-budget plan. The plan
is not perfect, by any means, but it must serve as a reminder that, in
order to balance the budget, it takes only the courage to stand in the
well of this chamber and cast our vote for a specific plan to eliminate
the deficit. There is no substitute for courage that can be drawn from
such an ill-conceived constitutional amendment.
In conclusion, Mr. President, let me announce my intention to support
final passage of S. Con. Res. 27.
I commend the members of the majority and minority leadership, and
the Budget Committee, who have come together with equanimity to work
out a bipartisan budget agreement with the White House. Compromise is
never easy to achieve, but its results may well be worth our efforts.
After all, let us not forget that the Senate itself was, according to
``The Federalist Papers,'' the ``result of compromise between the
opposite pretensions of the large and the small States.'' Similar
conflicting ``pretensions'' have helped mold the bipartisan budget
agreement before this body into a reasonable approach to balance the
budget.
Mr. President, I yield the floor.
Ms. LANDRIEU. Mr. President, I rise in support of Senate Concurrent
Resolution 27, the bipartisan budget agreement as amended during the
debate of the past few days. Mr. President, I believe that the Budget
Resolution represents an important victory for this body and for the
American people in that we can finally look forward to a balanced
budget by 2002. Priorities like Medicare, Medicaid, education and the
environment have been protected. This agreement, the first true
balanced budget in 28 years, delivers on a personal promise of mine to
work to strengthen the economy, balance the budget and put families
first.
Mr. President, I salute the work of both parties as the primary
reason this agreement was reached. Each side had to give and take to
get us to this point. I commend the President and the congressional
leadership, particularly Senator Domenici and Senator Lautenberg, for
their responsible conduct throughout this entire process. We are in
their debt.
Mr. President, the budget agreement puts more resources into
educating America's children--from Head Start to college--than the
Federal government has done in 30 years. It secures Medicare's solvency
for a decade, cleans up poisonous waste sites and will help move
millions of Americans from welfare to work. Just as important, it
accomplishes all this and gives needed tax relief to hard-working
families and small businesses through capital gains and estate tax cuts
and a $500 per child tax credit.
Mr. President, this agreement only begins our work, it doesn't end
it. I will go forward with my colleagues fighting for families--to
strengthen our investment in children by repairing their crumbling
schools, extending medical coverage to more children, and cutting
juvenile crime--and to strengthen Social Security and make retirement
secure for every working American.
Mr. KERRY. The Senate shortly will be taking a very momentous step.
We will be acting on a budget resolution designed to eliminate the
federal budget deficit by 2002. This has been an objective many of us
have fervently sought for many years. It has been my objective since I
came to the Senate in 1985.
The Federal Government has run a deficit continuously for more than
30 years, but it soared to what were then almost inconceivable heights
in the 1980s during the Reagan and Bush Administrations. As a result of
those stratospheric deficits, the national debt has multiplied several
times, exacting a toll from our economy, increasing interest rates, and
making debt service one of the largest expenditures in the Federal
budget.
I would like nothing more than to vote for a solid budget resolution
that would achieve balance while allocating resources in a way most
likely to meet our most pressing national needs. Because of the
strength of my desire to achieve balance and eliminate the deficit, I
am tempted to vote for the resolution that the Senate is considering
today. It does, of course, project balance in 2002.
Mr. President, I know how difficult it is to achieve a budget
compromise, which entails bridging the great differences among elected
officials--the President and his Administration and both Democrats and
Republicans in the Congress. President Clinton and his senior advisers,
the Senate and House Republican leadership, and the chairmen and
ranking members of the House and Senate Budget Committees have labored
mightily for many weeks to try to devise the plan on which we will be
voting today. Given those differences they had to bridge, I think they
are to be commended for what they accomplished.
But above all the applause for the deal they struck, and the
bipartisan congratulatory cheers simply for laying aside the usual
bickering and sticking with the plan they have prepared, I hear my
conscience saying it is wrong to ignore my core set of values and what
I believe should be the priorities for our Nation.
This budget deal, Mr. President, may be historic. I strongly support
the fact that it achieves balance in 5 years, and if that balance
actually is achieved, it surely will be historic. But that is far from
the only measure that should be applied to a budget. Deficit
elimination is a vital objective, but it is neither an economic policy
nor a statement of priorities for our Nation or its Government.
Said another way, it matters, and matters greatly, how we achieve
balance, not just that we achieve it.
Mr. President, despite the fact it achieves balance, and despite the
fact that one can imagine many budgets that would be worse for our
Nation--indeed, one need look no further than the draconian budget the
congressional Republicans tried to force down our throats as recently
as 2 years ago--this budget does not meet America's needs as I believe
they can and must be met while achieving budget balance. It fails this
test in two ways--one of those consists of vital activities it fails to
include, and the other consists of the detrimental effects of its
contents.
The foremost deficiency of this budget is that it has no vision for
America's children. To partially address this deficiency, I offered an
amendment to enable the Senate to consider legislation later this year
to meet the critical early developmental needs of children from birth
to age 6. I applaud the managers for accepting this amendment. But
earlier, the Senate rejected a bipartisan amendment that would have
provided the budgetary room needed to enact a program providing health
insurance to the millions of children who do not now have it.
We were presented with a deal that gives lip service to some of our
critical domestic needs by providing limited room for so-called
Presidential initiatives. These include $16 billion over 5 years to
provide health insurance to children who do not now have it; an
increase in Pell grants; and increased funding for bilingual and
immigrant education, child literacy initiatives, Head Start, and
Environmental Protection Agency and National Park Service operations.
But the allocations for these categories fall far short of the
additional investments that are needed in these and other critical
areas.
The share of our gross domestic product invested in education,
training, infrastructure, and civilian research and development will
continue to decline for the next 5 years under this budget blueprint.
Many Senators--on both sides of the aisle--pointed this out during the
debate and each one in turn was rebuffed.
Look at the amendment by my great friend and colleague, the senior
Senator from Massachusetts, Senator Kennedy, and the chairman of the
Judiciary Committee, Senator Hatch. The amendment they offered would
enable an expansion of health coverage to all uninsured American
children. But their amendment was defeated--shot down for the sake of
the deal. Look at the amendment by my able friend, the senior Senator
from Illinois. Senator

[[Page S5053]]

Moseley-Braun attempted to set aside $5 billion for school
construction. Of the schools in Massachusetts, 92 percent are in
disrepair, and this money would have been a downpayment on our
obligation to allow these children and all American children to have at
a minimum a proper setting in which to learn. But Senator Moseley-
Braun's amendment was rejected. And, why? Because it purportedly would
have busted the deal.
The Senator from Minnesota, Senator Wellstone, sought to increase
funding for Head Start, school lunches, and school construction.
Republicans cynically demolished that amendment by passing a substitute
amendment calling for a school voucher program.
At the head of the list of the harmful features of the bill can be
placed the effects of its tax cuts. I support and believe the Nation
can benefit greatly from the President's initiatives to provide
assistance through the Tax Code to American families and individuals to
help them meet the costs of higher and continuing education. But this
budget resolution includes tax cuts that are sufficiently large that
the result inescapably will be to increase the deficit--yes, I said
increase the deficit--for at least the next 2 years.

Considerably more potentially destructive, despite a fuzzy commitment
by the deal cutters that the tax cuts will not be backloaded--that is,
they will not result in mushrooming revenue loss in the future, the
revenue losses will significantly increase in the outyears. The net
revenue loss over 5 years will be $85 billion; the net loss over 10
years is projected to be $250 billion.
Mr. President, while President Clinton did win some less-than-
ironclad assurances that the Republican-controlled Finance and Ways and
Means Committees will include some of his tax cut priorities regarding
education tax deductions and credits and a child tax credit, the
Republicans insist on including sweeping, broad-based, across-the-board
capital gains and estate tax reductions among a host of tax cuts. These
cuts will have a dramatically skewed distribution, providing the
greatest portion of their benefits to taxpayers with annual incomes
placing them among the top 5 percent of the Nation.
It is instructive to look at two proposals. Reducing capital gains
taxation from 28 percent to 19.6 percent will yield 85 percent of the
benefit to the top 5 percent of taxpayers, all with incomes exceeding
$100,000. Reducing the estate tax by increasing the exemption from
$600,000 to $1 million will benefit only the wealthiest 1 percent of
households. Under current law, 98 percent of Americans who die leave
estates wholly exempt from estate taxes. Such proposals can only be
viewed as Republican ``welfare-for-the-rich'' at its worst.
Mr. President, while non-defense discretionary accounts are squeezed
harder as we approach the magical balance to occur in 2002, and while
most Americans have worked hard and sacrificed for the past 5 years to
keep our economy booming and slash the deficit more than $200 billion
and will be required to tighten their belts further by this resolution,
the richest Americans and American corporations are absolved from
contributing to the final push to 2002. The deal virtually ignores
corporate welfare--both that which exists among discretionary spending
programs and the far larger amount which exists in the Internal Revenue
Code.
At a time when beneficiaries of spending programs--especially lower-
income beneficiaries--have been subjected to significant reductions in
those benefits they have received, corporate beneficiaries are asked to
bear virtually none of the cost of achieving budget balance, much less
paying for the investments in people and infrastructure that are so
badly needed.
As my distinguished friend, the eternally junior Senator from South
Carolina, Senator Hollings, said on the floor on Tuesday evening, there
is a scarcity of discipline in this budget and even less willingness to
take less-than-pleasant budget medicine now in order to experience
economic and budgetary order in later years. Instead, even that limited
budgetary reckoning the deal entails is largely postponed until the
final 2 years of the deal. Because of this, the national debt will
increase significantly in the next several years, resulting in ever-
higher debt service costs which must be borne by the budget until that
debt is reduced.
I reiterate that I staunchly support balancing the Federal budget.
But I do not believe in balancing the budget in just any way. One
roadmap for achieving balance is not the same as every other roadmap
for achieving balance. There unquestionably is a difference. Indeed, I
have worked on and voted for balanced budget plans over the years with
colleagues on both sides of the aisle. But, I cannot vote for this one.
It is a Wizard of Oz budget deal--no home, no heart, no brain, and no
courage.
If this budget passes and becomes the operative structure for fiscal
decision making by the Congress, as I expect it may, I will work
diligently to do everything possible to meet the needs of America's
children, and other pressing needs, within its constraints, and to
alter those constraints where it is possible to do so.
But, with no joy, I will vote no on final passage, greatly
disappointed and saddened that the Senate has not taken the steps and
provided the opportunities that are so badly needed to fairly confront
and meet our Nation's most critical needs while achieving a balanced
budget.
Mr. DASCHLE. Mr. President, this is an historic occasion. This budget
outline is the first plan Congress has produced in 28 years to balance
the budget.
I want to thank all of those who worked so hard to get us to this
point, including the President and Vice President, Erskine Bowles,
Frank Raines, John Hilley and others at the White House, Senators Frank
Lautenberg, ranking member of the Senate Budget Committee, House
minority leader Dick Gephardt and John Spratt.
I also want to thank our partners across the aisle: Senate majority
leader Lott, Senator Pete Domenici, chairman of the Senate Budget
Committee, Speaker Gingrich and Congressman John Kasich.
And all the staff, in both houses, the administration and including
my own, who have worked so diligently to complete this agreement.
Finally, I want to thank two former colleagues, Senators Jim Sasser
and Harris Wofford, who were defeated for re-election in 1994--in no
small part because they supported the 1993 deficit reduction plan.
Without that plan we would not be here today. Because of that plan,
we've been able to cut the budget deficit by 75 percent. In less than 5
years, we've gone from a $280 billion deficit to a $67 billion deficit.
The U.S. economy has added more than 12.5 million new jobs, and 3
million small businesses. Our economy is now growing at a virtually
unparalleled rate of 3.5 percent a year. Unemployment is at its lowest
level in 24 years. Young people graduating from college this month are
entering one of the best job markets in years. That's a remarkable
record of progress.
I support this budget resolution because it builds on that progress.
Make no mistake: This budget plan is not the culmination of the
Contract With America. It is, in some fundamental ways, a repudiation
of that contract.
Where the contract targeted tax relief to those who needed it least,
this budget agreement targets it to those who need it most. Where the
contract would have left Medicare to wither on the vine, this agreement
extends the solvency of the Medicare trust funds for a decade. Where
the contract represented a declaration of war, this resolution is
instead a declaration of principles.
There is a difference between a budget that slashes and burns to get
to zero, and a budget that is truly balanced. This resolution--if we
adhere to it--will result in a balanced budget that addresses not only
our financial deficit, but our investment deficit as well. This budget
plan sets aside $35 billion in education tax relief, to help working
families pay for college and job training. This plan will provide
health insurance for 5 million children--half of the uninsured children
in America. This plan extends the life of Superfund, so we can clean up
the environmental mistakes of our past, and it invests in environmental
safeguards, so we can avoid mistakes in the future. This budget keeps
Medicare solvent for another decade--without gouging senior citizens
who depend on the program.
It is a good deal. But it is not a done deal. We still have a long
way to go before this declaration of principles is

[[Page S5054]]

translated into an actual budget--13 individual appropriations bills,
plus a reconciliation bill.
We know full well, from the last Congress, how difficult these next
steps can be. It is my hope that we will also remember the painful
consequences of refusing to take those steps. As long as the
commitments we have received now in writing are honored, we will
proceed in good faith toward reconciliation.
That does not mean, however, that we will be passive observers of
this process. Any attempt to undermine our agreement and skew the tax
relief to benefit disproportionately those who need tax relief the
least will be met with forceful opposition. So will any effort to
shortchange our agreement on education tax credits and children's
health insurance.
The time for negotiations on these priorities is over. There is more
than enough money, and flexibility, in this budget plan to honor these
important commitments. There is also enough room in this framework to
accommodate our proposal to help communities rebuild crumbling schools,
and replace obsolete schools. According to the Government Accounting
Office, one-third of all schools--serving 14 million children--require
extensive repair or replacement. Almost 60 percent of schools have at
least one major structural problem, from sagging roofs to cracked
foundations. About half have unhealthy environmental conditions, such
as poor ventilation or inadequate heating. Half lack the basic
electrical wiring needed to connect them to the information
superhighway.
It is wrong for us to hobble future generations with the debts of
this generation; that is why we are taking these steps to eliminate the
deficit. But it is equally wrong to deny future generations the basic
tools they will need to make a life for themselves and their own
families. Education is the most important of those tools, and that
includes safe, adequate schools.
It is our hope that we can have a truly balanced budget on its way to
the President's desk before the August recess. Then we need to turn our
attention to other concerns, including juvenile drug abuse and crime,
pension reform and, yes, campaign finance reform. Bipartisanship does
not come easy to this Congress. But this budget outline proves it is
not impossible.
It is my hope that we will be able to work together to make sure this
balanced budget framework is not the only bipartisan victory of this
Congress, but merely the first. There is much more we need to do.

Amendments Nos. 310, 338, 339, 349 Withdrawn

Mr. DOMENICI. Mr. President, I ask unanimous consent that any
amendments that were pending at the desk and have not been called up be
withdrawn.
The PRESIDING OFFICER. Is there objection? Without objection, it is
so ordered.
Amendments Nos. 310, 338, 339, 349 were withdrawn.
The PRESIDING OFFICER. Under the previous order, the clerk will
report House Concurrent Resolution 84.
The assistant legislative clerk read as follows:

A Concurrent Resolution (H. Con. Res. 84) establishing the
Congressional Budget for fiscal years 1998 through 2002.

The PRESIDING OFFICER. All after the resolving clause is stricken,
and the text of Senate Concurrent Resolution 27 will be inserted in
lieu thereof.
The question now occurs on agreeing to the concurrent resolution,
House Concurrent Resolution 84, as amended.
Mr. DOMENICI. Mr. President, I ask for the yeas and nays.
The PRESIDING OFFICER. There is a request for a second.
Is there a sufficient second?
There is a sufficient second.
The yeas and nays were ordered.
The PRESIDING OFFICER. The question occurs on agreeing to House
Concurrent Resolution 84, as amended. The yeas and nays have been
ordered.
The clerk will call the roll.
The assistant legislative clerk called the roll.
The PRESIDING OFFICER. Are there any other Senators in the Chamber
who desire to vote?
The result was announced, yeas 78, nays 22, as follows:

[Rollcall Vote No. 92 Leg.]

YEAS--78

Abraham
Akaka
Baucus
Bennett
Biden
Bingaman
Bond
Boxer
Breaux
Brownback
Bryan
Burns
Byrd
Campbell
Chafee
Cleland
Cochran
Collins
Conrad
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Domenici
Dorgan
Durbin
Feingold
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Grassley
Gregg
Hagel
Harkin
Hatch
Hutchinson
Hutchison
Inouye
Jeffords
Johnson
Kempthorne
Kerrey
Kohl
Landrieu
Lautenberg
Leahy
Levin
Lieberman
Lott
Lugar
Mack
McCain
McConnell
Mikulski
Moseley-Braun
Murkowski
Murray
Nickles
Reid
Robb
Roberts
Rockefeller
Roth
Santorum
Sessions
Shelby
Smith (OR)
Snowe
Stevens
Thurmond
Torricelli
Warner
Wyden

NAYS--22

Allard
Ashcroft
Bumpers
Coats
Enzi
Faircloth
Gramm
Grams
Helms
Hollings
Inhofe
Kennedy
Kerry
Kyl
Moynihan
Reed
Sarbanes
Smith (NH)
Specter
Thomas
Thompson
Wellstone
The concurrent resolution (H. Con. Res. 84), as amended, was agreed
to, as follows:
Resolved, That the resolution from the House of
Representatives (H. Con. Res. 84) entitled ``Concurrent
resolution establishing the congressional budget for the
United States Government for fiscal year 1998 and setting
forth appropriate budgetary levels for fiscal years 1999,
2000, 2001, and 2002.'', do pass with the following
amendment:
Strike out all after the resolving clause and insert:

SECTION 1. CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL
YEAR 1998.

(a) Declaration.--The Congress determines and declares that
this resolution is the concurrent resolution on the budget
for fiscal year 1998 including the appropriate budgetary
levels for fiscal years 1999, 2000, 2001, and 2002 as
required by section 301 of the Congressional Budget Act of
1974.
(b) Table of Contents.--The table of contents for this
concurrent resolution is as follows:

Sec. 1. Concurrent resolution on the budget for fiscal year 1998.

TITLE I--LEVELS AND AMOUNTS

Sec. 101. Recommended levels and amounts.
Sec. 102. Social security.
Sec. 103. Major functional categories.
Sec. 104. Reconciliation.

TITLE II--BUDGETARY RESTRAINTS AND RULEMAKING

Sec. 201. Discretionary spending limits.
Sec. 202. Allowance in the Senate.
Sec. 203. Allowance in the Senate for section 8 housing assistance.
Sec. 204. Environmental reserve.
Sec. 205. Priority Federal land acquisitions and exchanges.
Sec. 206. Allowance in the Senate for arrearages.
Sec. 207. Intercity passenger rail reserve fund for fiscal years 1998-
2002.
Sec. 208. Mass transit reserve fund for fiscal years 1998-2002.
Sec. 209. Highway reserve fund for fiscal years 1998-2002.
Sec. 210. Exercise of rulemaking powers.

TITLE III--SENSE OF THE SENATE

Sec. 301. Sense of the Senate on long term entitlement reforms,
including accuracy in determining changes in the cost of
living.
Sec. 302. Sense of the Senate on tactical fighter aircraft programs.
Sec. 303. Sense of the Senate regarding children's health coverage.
Sec. 304. Sense of the Senate on a medicaid per capita cap.
Sec. 305. Sense of the Senate that added savings go to deficit
reduction.
Sec. 306. Sense of the Senate on fairness in medicare.
Sec. 307. Sense of the Senate regarding assistance to Lithuania and
Latvia.
Sec. 308. Sense of the Senate regarding a national commission on higher
education.
Sec. 309. Sense of the Senate on lockbox.
Sec. 310. Sense of the Senate on the earned income credit.
Sec. 311. Sense of the Senate on repayment of the Federal debt.
Sec. 312. Sense of the Senate supporting long-term entitlement reforms.
Sec. 313. Sense of the Senate on disaster assistance funding.
Sec. 314. Sense of the Senate on enforcement of bipartisan budget
agreement.
Sec. 315. Sense of the Senate regarding the National Institutes of
Health.
Sec. 316. Sense of the Senate regarding certain elderly legal aliens.
Sec. 317. Sense of the Senate regarding retroactive taxes.
Sec. 318. Sense of the Senate on social security and balancing the
budget
Sec. 319. Sense of the Senate supporting sufficient funding for
veterans programs and benefits.
Sec. 320. Sense of Congress on family violence option clarifying
amendment.
Sec. 321. Sense of the Senate on tax cuts.
Sec. 322. Sense of the Senate regarding assistance to Amtrak.
Sec. 323. Sense of the Senate regarding the protection of children's
health.

[[Page S5055]]

Sec. 324. Deposit of all Federal gasoline taxes into the Highway Trust
Fund.
Sec. 325. Sense of the Senate early childhood education.
Sec. 326. Highway Trust Fund not taken into account for deficit
purposes.
Sec. 327. Airport and Airway Trust Fund not taken into account for
deficit purposes.
Sec. 328. Military Retirement Trust Funds not taken into account for
deficit purposes.
Sec. 329. Civil Service Retirement Trust Funds not taken into account
for deficit purposes.
Sec. 330. Unemployment Compensation Trust Fund not taken into account
for deficit purposes.
Sec. 331. Sense of the Senate concerning Highway Trust Fund.
Sec. 332. Sense of the Senate concerning tax incentives for the cost of
post-secondary education.
Sec. 333. Sense of the Senate on additional tax cuts.
Sec. 334. Sense of the Senate regarding truth in budgeting and spectrum
auctions
Sec. 335. Highway demonstration projects.
Sec. 336. Sense of the Senate regarding the use of budget savings.
Sec. 337. Sense of the Senate regarding the value of the social
security system for future retirees.
Sec. 338. Sense of the Senate on economic growth dividend protection.
Sec. 339. Deficit-neutral reserve fund in the Senate.
Sec. 340. Support for Federal, State, and local law enforcement
officers.
Sec. 341. Sense of Congress regarding parental involvement in
prevention of drug use by children.
TITLE I--LEVELS AND AMOUNTS

SEC. 101. RECOMMENDED LEVELS AND AMOUNTS.

The following budgetary levels are appropriate for the
fiscal years 1998, 1999, 2000, 2001, and 2002:
(1) Federal revenues.--For purposes of the enforcement of
this resolution--
(A) The recommended levels of Federal revenues are as
follows:
Fiscal year 1998: $1,199,000,000,000.
Fiscal year 1999: $1,241,900,000,000.
Fiscal year 2000: $1,285,600,000,000.
Fiscal year 2001: $1,343,600,000,000.
Fiscal year 2002: $1,407,600,000,000.
(B) The amounts by which the aggregate levels of Federal
revenues should be changed are as follows:
Fiscal year 1998: $-7,400,000,000.
Fiscal year 1999: $-11,100,000,000.
Fiscal year 2000: $-22,000,000,000.
Fiscal year 2001: $-22,800,000,000.
Fiscal year 2002: $-19,900,000,000.
(C) The amounts for Federal Insurance Contributions Act
revenues for hospital insurance within the recommended levels
of Federal revenues are as follows:
Fiscal year 1998: $113,500,000,000.
Fiscal year 1999: $119,100,000,000.
Fiscal year 2000: $125,100,000,000.
Fiscal year 2001: $130,700,000,000.
Fiscal year 2002: $136,800,000,000.
(2) New budget authority.--For purposes of the enforcement
of this resolution, the appropriate levels of total new
budget authority are as follows:
Fiscal year 1998: $1,386,700,000,000.
Fiscal year 1999: $1,440,100,000,000.
Fiscal year 2000: $1,488,939,000,000.
Fiscal year 2001: $1,520,200,000,000.
Fiscal year 2002: $1,551,600,000,000.
(3) Budget outlays.--For purposes of the enforcement of
this resolution, the appropriate levels of total budget
outlays are as follows:
Fiscal year 1998: $1,372,000,000,000.
Fiscal year 1999: $1,424,100,000,000.
Fiscal year 2000: $1,468,800,000,000.
Fiscal year 2001: $1,500,700,000,000.
Fiscal year 2002: $1,515,900,000,000.
(4) Deficits.--For purposes of the enforcement of this
resolution, the amounts of the deficits are as follows:
Fiscal year 1998: $-173,000,000,000.
Fiscal year 1999: $-182,200,000,000.
Fiscal year 2000: $-183,200,000,000.
Fiscal year 2001: $-157,100,000,000.
Fiscal year 2002: $-108,300,000,000.
(5) Public debt.--The appropriate levels of the public debt
are as follows:
Fiscal year 1998: $5,593,500,000,000.
Fiscal year 1999: $5,841,000,000,000.
Fiscal year 2000: $6,088,600,000,000.
Fiscal year 2001: $6,307,300,000,000.
Fiscal year 2002: $6,481,200,000,000.
(6) Direct loan obligations.--The appropriate levels of
total new direct loan obligations are as follows:
Fiscal year 1998: $34,000,000,000.
Fiscal year 1999: $33,400,000,000.
Fiscal year 2000: $34,900,000,000.
Fiscal year 2001: $36,100,000,000.
Fiscal year 2002: $37,400,000,000.
(7) Primary loan guarantee commitments.--The appropriate
levels of new primary loan guarantee commitments are as
follows:
Fiscal year 1998: $315,700,000,000.
Fiscal year 1999: $324,900,000,000.
Fiscal year 2000: $328,200,000,000.
Fiscal year 2001: $332,200,000,000.
Fiscal year 2002: $335,300,000,000.

SEC. 102. SOCIAL SECURITY.

(a) Social Security Revenues.--For purposes of Senate
enforcement under sections 302, 602, and 311 of the
Congressional Budget Act of 1974, the amounts of revenues of
the Federal Old-Age and Survivors Insurance Trust Fund and
the Federal Disability Insurance Trust Fund are as follows:
Fiscal year 1998: $402,800,000,000.
Fiscal year 1999: $422,300,000,000.
Fiscal year 2000: $442,600,000,000.
Fiscal year 2001: $461,600,000,000.
Fiscal year 2002: $482,800,000,000.
(b) Social Security Outlays.--For purposes of Senate
enforcement under sections 302, 602, and 311 of the
Congressional Budget Act of 1974, the amounts of outlays of
the Federal Old-Age and Survivors Insurance Trust Fund and
the Federal Disability Insurance Trust Fund are as follows:
Fiscal year 1998: $317,600,000,000.
Fiscal year 1999: $330,600,000,000.
Fiscal year 2000: $343,600,000,000.
Fiscal year 2001: $358,100,000,000.
Fiscal year 2002: $372,500,000,000.

SEC. 103. MAJOR FUNCTIONAL CATEGORIES.

The Congress determines and declares that the appropriate
levels of new budget authority, budget outlays, new direct
loan obligations, and new primary loan guarantee commitments
for fiscal years 1998 through 2002 for each major functional
category are:
(1) National Defense (050):
Fiscal year 1998:
(A) New budget authority, $268,200,000,000.
(B) Outlays, $266,000,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $600,000,000.
Fiscal year 1999:
(A) New budget authority, $270,800,000,000.
(B) Outlays, $265,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $800,000,000.
Fiscal year 2000:
(A) New budget authority, $274,800,000,000.
(B) Outlays, $268,400,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $1,100,000,000.
Fiscal year 2001:
(A) New budget authority, $281,300,000,000.
(B) Outlays, $270,100,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $1,100,000,000.
Fiscal year 2002:
(A) New budget authority, $289,100,000,000.
(B) Outlays, $272,600,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $1,100,000,000.
(2) International Affairs (150):
Fiscal year 1998:
(A) New budget authority, $15,900,000,000.
(B) Outlays, $14,600,000,000.
(C) New direct loan obligations, $2,000,000,000.
(D) New primary loan guarantee commitments,
$12,800,000,000.
Fiscal year 1999:
(A) New budget authority, $14,900,000,000.
(B) Outlays, $14,600,000,000.
(C) New direct loan obligations, $2,000,000,000.
(D) New primary loan guarantee commitments,
$13,100,000,000.
Fiscal year 2000:
(A) New budget authority, $15,800,000,000.
(B) Outlays, $15,000,000,000.
(C) New direct loan obligations, $2,100,000,000.
(D) New primary loan guarantee commitments,
$13,400,000,000.
Fiscal year 2001:
(A) New budget authority, $16,100,000,000.
(B) Outlays, $14,800,000,000.
(C) New direct loan obligations, $2,100,000,000.
(D) New primary loan guarantee commitments,
$13,800,000,000.
Fiscal year 2002:
(A) New budget authority, $16,400,000,000.
(B) Outlays, $14,800,000,000.
(C) New direct loan obligations, $2,200,000,000.
(D) New primary loan guarantee commitments,
$14,200,000,000.
(3) General Science, Space, and Technology (250):
Fiscal year 1998:
(A) New budget authority, $16,200,000,000.
(B) Outlays, $16,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $16,200,000,000.
(B) Outlays, $16,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $15,900,000,000.
(B) Outlays, $16,000,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $15,800,000,000.
(B) Outlays, $15,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $15,600,000,000.
(B) Outlays, $15,700,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(4) Energy (270):
Fiscal year 1998:
(A) New budget authority, $3,100,000,000.
(B) Outlays, $2,200,000,000.
(C) New direct loan obligations, $1,100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $3,500,000,000.
(B) Outlays, $2,400,000,000.
(C) New direct loan obligations, $1,100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $3,200,000,000.

[[Page S5056]]

(B) Outlays, $2,300,000,000.
(C) New direct loan obligations, $1,100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $2,900,000,000.
(B) Outlays, $2,000,000,000.
(C) New direct loan obligations, $1,100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $2,800,000,000.
(B) Outlays, $1,900,000,000.
(C) New direct loan obligations, $1,200,000,000.
(D) New primary loan guarantee commitments, $0.
(5) Natural Resources and Environment (300):
Fiscal year 1998:
(A) New budget authority, $23,900,000,000.
(B) Outlays, $22,400,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $23,200,000,000.
(B) Outlays, $22,700,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $22,600,000,000.
(B) Outlays, $23,000,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $22,200,000,000.
(B) Outlays, $22,700,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $22,100,000,000.
(B) Outlays, $22,300,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
(6) Agriculture (350):
Fiscal year 1998:
(A) New budget authority, $13,100,000,000.
(B) Outlays, $11,900,000,000.
(C) New direct loan obligations, $9,600,000,000.
(D) New primary loan guarantee commitments, $6,400,000,000.
Fiscal year 1999:
(A) New budget authority, $12,800,000,000.
(B) Outlays, $11,300,000,000.
(C) New direct loan obligations, $11,000,000,000.
(D) New primary loan guarantee commitments, $6,400,000,000.
Fiscal year 2000:
(A) New budget authority, $12,200,000,000.
(B) Outlays, $10,700,000,000.
(C) New direct loan obligations, $11,100,000,000.
(D) New primary loan guarantee commitments, $6,500,000,000.
Fiscal year 2001:
(A) New budget authority, $11,000,000,000.
(B) Outlays, $9,500,000,000.
(C) New direct loan obligations, $11,000,000,000.
(D) New primary loan guarantee commitments, $6,600,000,000.
Fiscal year 2002:
(A) New budget authority, $10,700,000,000.
(B) Outlays, $9,100,000,000.
(C) New direct loan obligations, $11,000,000,000.
(D) New primary loan guarantee commitments, $6,700,000,000.
(7) Commerce and Housing Credit (370):
Fiscal year 1998:
(A) New budget authority, $6,600,000,000.
(B) Outlays, -$900,000,000.
(C) New direct loan obligations, $4,700,000,000.
(D) New primary loan guarantee commitments,
$245,500,000,000.
Fiscal year 1999:
(A) New budget authority, $11,100,000,000.
(B) Outlays, $4,300,000,000.
(C) New direct loan obligations, $1,900,000,000.
(D) New primary loan guarantee commitments,
$253,500,000,000.
Fiscal year 2000:
(A) New budget authority, $15,200,000,000.
(B) Outlays, $9,800,000,000.
(C) New direct loan obligations, $2,200,000,000.
(D) New primary loan guarantee commitments,
$255,200,000,000.
Fiscal year 2001:
(A) New budget authority, $16,100,000,000.
(B) Outlays, $12,100,000,000.
(C) New direct loan obligations, $2,600,000,000.
(D) New primary loan guarantee commitments,
$258,000,000,000.
Fiscal year 2002:
(A) New budget authority, $16,700,000,000.
(B) Outlays, $12,500,000,000.
(C) New direct loan obligations, $2,700,000,000.
(D) New primary loan guarantee commitments,
$259,900,000,000.
(8) Transportation (400):
Fiscal year 1998:
(A) New budget authority, $46,400,000,000.
(B) Outlays, $40,900,000,000.
(C) New direct loan obligations, $200,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $46,600,000,000.
(B) Outlays, $41,300,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $47,100,000,000.
(B) Outlays, $41,400,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $48,100,000,000.
(B) Outlays, $41,300,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $49,200,000,000.
(B) Outlays, $41,200,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $0.
(9) Community and Regional Development (450):
Fiscal year 1998:
(A) New budget authority, $8,800,000,000.
(B) Outlays, $10,400,000,000.
(C) New direct loan obligations, $2,900,000,000.
(D) New primary loan guarantee commitments, $2,400,000,000.
Fiscal year 1999:
(A) New budget authority, $8,500,000,000.
(B) Outlays, $10,900,000,000.
(C) New direct loan obligations, $2,900,000,000.
(D) New primary loan guarantee commitments, $2,400,000,000.
Fiscal year 2000:
(A) New budget authority, $7,800,000,000.
(B) Outlays, $11,000,000,000.
(C) New direct loan obligations, $3,000,000,000.
(D) New primary loan guarantee commitments, $2,400,000,000.
Fiscal year 2001:
(A) New budget authority, $7,800,000,000.
(B) Outlays, $11,400,000,000.
(C) New direct loan obligations, $3,100,000,000.
(D) New primary loan guarantee commitments, $2,500,000,000.
Fiscal year 2002:
(A) New budget authority, $7,800,000,000.
(B) Outlays, $8,400,000,000.
(C) New direct loan obligations, $3,200,000,000.
(D) New primary loan guarantee commitments, $2,500,000,000.
(10) Education, Training, Employment, and Social Services
(500):
Fiscal year 1998:
(A) New budget authority, $60,000,000,000.
(B) Outlays, $56,100,000,000.
(C) New direct loan obligations, $12,300,000,000.
(D) New primary loan guarantee commitments,
$20,700,000,000.
Fiscal year 1999:
(A) New budget authority, $60,500,000,000.
(B) Outlays, $59,300,000,000.
(C) New direct loan obligations, $13,100,000,000.
(D) New primary loan guarantee commitments,
$21,900,000,000.
Fiscal year 2000:
(A) New budget authority, $64,239,000,000.
(B) Outlays, $60,700,000,000.
(C) New direct loan obligations, $13,900,000,000.
(D) New primary loan guarantee commitments,
$23,300,000,000.
Fiscal year 2001:
(A) New budget authority, $63,000,000,000.
(B) Outlays, $61,900,000,000.
(C) New direct loan obligations, $14,700,000,000.
(D) New primary loan guarantee commitments,
$24,500,000,000.
Fiscal year 2002:
(A) New budget authority, $63,300,000,000.
(B) Outlays, $62,300,000,000.
(C) New direct loan obligations, $15,400,000,000.
(D) New primary loan guarantee commitments,
$25,700,000,000.
(11) Health (550):
Fiscal year 1998:
(A) New budget authority, $137,800,000,000.
(B) Outlays, $137,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $100,000,000.
Fiscal year 1999:
(A) New budget authority, $145,000,000,000.
(B) Outlays, $144,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $154,100,000,000.
(B) Outlays, $153,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $163,400,000,000.
(B) Outlays, $163,100,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $172,200,000,000.
(B) Outlays, $171,700,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(12) Medicare (570):
Fiscal year 1998:
(A) New budget authority, $201,600,000,000.
(B) Outlays, $201,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $212,100,000,000.
(B) Outlays, $211,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $225,500,000,000.
(B) Outlays, $225,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $239,600,000,000.
(B) Outlays, $238,800,000,000.

[[Page S5057]]

(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $251,500,000,000.
(B) Outlays, $250,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(13) Income Security (600):
Fiscal year 1998:
(A) New budget authority, $239,000,000,000.
(B) Outlays, $247,800,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $100,000,000.
Fiscal year 1999:
(A) New budget authority, $254,100,000,000.
(B) Outlays, $258,100,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $100,000,000.
Fiscal year 2000:
(A) New budget authority, $269,600,000,000.
(B) Outlays, $268,200,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $100,000,000.
Fiscal year 2001:
(A) New budget authority, $275,100,000,000.
(B) Outlays, $277,300,000,000.
(C) New direct loan obligations, $100,000,000.
(D) New primary loan guarantee commitments, $100,000,000.
Fiscal year 2002:
(A) New budget authority, $286,900,000,000.
(B) Outlays, $285,200,000,000.
(C) New direct loan obligations, $200,000,000.
(D) New primary loan guarantee commitments, $100,000,000.
(14) Social Security (650):
Fiscal year 1998:
(A) New budget authority, $11,400,000,000.
(B) Outlays, $11,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $12,100,000,000.
(B) Outlays, $12,200,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $12,800,000,000.
(B) Outlays, $12,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $13,000,000,000.
(B) Outlays, $13,000,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $14,400,000,000.
(B) Outlays, $14,400,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(15) Veterans Benefits and Services (700):
Fiscal year 1998:
(A) New budget authority, $40,500,000,000.
(B) Outlays, $41,300,000,000.
(C) New direct loan obligations, $1,000,000,000.
(D) New primary loan guarantee commitments,
$27,100,000,000.
Fiscal year 1999:
(A) New budget authority, $41,500,000,000.
(B) Outlays, $41,700,000,000.
(C) New direct loan obligations, $1,100,000,000.
(D) New primary loan guarantee commitments,
$26,700,000,000.
Fiscal year 2000:
(A) New budget authority, $41,700,000,000.
(B) Outlays, $41,900,000,000.
(C) New direct loan obligations, $1,200,000,000.
(D) New primary loan guarantee commitments,
$26,200,000,000.
Fiscal year 2001:
(A) New budget authority, $42,100,000,000.
(B) Outlays, $42,200,000,000.
(C) New direct loan obligations, $1,200,000,000.
(D) New primary loan guarantee commitments,
$25,600,000,000.
Fiscal year 2002:
(A) New budget authority, $42,300,000,000.
(B) Outlays, $42,400,000,000.
(C) New direct loan obligations, $1,300,000,000.
(D) New primary loan guarantee commitments,
$25,100,000,000.
(16) Administration of Justice (750):
Fiscal year 1998:
(A) New budget authority, $24,800,000,000.
(B) Outlays, $22,600,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $25,100,000,000.
(B) Outlays, $24,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $24,200,000,000.
(B) Outlays, $25,200,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $24,400,000,000.
(B) Outlays, $25,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $24,900,000,000.
(B) Outlays, $24,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(17) General Government (800):
Fiscal year 1998:
(A) New budget authority, $14,700,000,000.
(B) Outlays, $14,000,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $14,400,000,000.
(B) Outlays, $14,400,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $14,000,000,000.
(B) Outlays, $14,700,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $13,700,000,000.
(B) Outlays, $14,100,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $13,100,000,000.
(B) Outlays, $13,100,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(18) Net Interest (900):
Fiscal year 1998:
(A) New budget authority, $296,500,000,000.
(B) Outlays, $296,500,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, $304,600,000,000.
(B) Outlays, $304,600,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, $304,900,000,000.
(B) Outlays, $304,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, $303,700,000,000.
(B) Outlays, $303,700,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, $303,800,000,000.
(B) Outlays, $303,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(19) Allowances (920):
Fiscal year 1998:
(A) New budget authority, -$0.
(B) Outlays, -$0.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, -$0.
(B) Outlays, -$0.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, -$0.
(B) Outlays, -$0.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, -$0.
(B) Outlays, -$0.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, -$0.
(B) Outlays, -$0.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
(20) Undistributed Offsetting Receipts (950):
Fiscal year 1998:
(A) New budget authority, -$41,800,000,000.
(B) Outlays, -$41,800,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 1999:
(A) New budget authority, -$36,900,000,000.
(B) Outlays, -$36,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2000:
(A) New budget authority, -$36,900,000,000.
(B) Outlays, -$36,900,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2001:
(A) New budget authority, -$39,200,000,000.
(B) Outlays, -$39,200,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.
Fiscal year 2002:
(A) New budget authority, -$51,100,000,000.
(B) Outlays, -$51,100,000,000.
(C) New direct loan obligations, $0.
(D) New primary loan guarantee commitments, $0.

SEC. 104. RECONCILIATION.

(a) Reconciliation of Spending Reductions.--Not later than
June 20, 1997, the committees named in this subsection shall
submit their recommendations to the Committee on the Budget
of the Senate. After receiving those recommendations, the
Committee on the Budget

[[Page S5058]]

shall report to the Senate a reconciliation bill carrying out
all such recommendations without any substantive revision.
(1) Committee on agriculture, nutrition, and forestry.--The
Senate Committee on Agriculture, Nutrition, and Forestry
shall report changes in laws within its jurisdiction that
increase outlays by $300,000,000 in fiscal year 2002 and
$1,500,000,000 for the period of fiscal years 1998 through
2002.
(2) Committee on banking, housing, and urban affairs.--The
Senate Committee on Banking, Housing, and Urban Affairs shall
report changes in laws within its jurisdiction that reduce
the deficit $434,000,000 in fiscal year 2002 and
$1,590,000,000 for the period of fiscal years 1998 through
2002.
(3) Committee on commerce, science, and transportation.--
The Senate Committee on Commerce, Science, and Transportation
shall report changes in laws within its jurisdiction that
reduce the deficit $14,849,000,000 in fiscal year 2002 and
$26,496,000,000 for the period of fiscal years 1998 through
2002.
(4) Committee on energy and natural resources.--The Senate
Committee on Energy and Natural Resources shall report
changes in laws within its jurisdiction that provide direct
spending (as defined in section 250(c)(8) of the Balanced
Budget and Emergency Deficit Control Act of 1985) to reduce
outlays $6,000,000 in fiscal year 2002 and $13,000,000 for
the period of fiscal years 1998 through 2002.
(5) Committee on finance.--The Senate Committee on Finance
shall report to the Senate changes in laws within its
jurisdiction--
(A) that provide direct spending (as defined in section
250(c)(8) of the Balanced Budget and Emergency Deficit
Control Act of 1985) to reduce outlays $40,911,000,000 in
fiscal year 2002 and $100,646,000,000 for the period of
fiscal years 1998 through 2002; and
(B) to increase the statutory limit on the public debt to
not more than $5,950,000,000,000.
(6) Committee on governmental affairs.--The Senate
Committee on Governmental Affairs shall report changes in
laws within its jurisdiction that reduce the deficit
$1,769,000,000 in fiscal year 2002 and $5,467,000,000 for the
period of fiscal years 1998 through 2002.
(7) Committee on labor and human resources.--The Senate
Committee on Labor and Human Resources shall report changes
in laws within its jurisdiction that provide direct spending
(as defined in section 250(c)(8) of the Balanced Budget and
Emergency Deficit Control Act of 1985) to reduce outlays
$1,057,000,000 in fiscal year 2002 and $1,792,000,000 for the
period of fiscal years 1998 through 2002.
(8) Committee on veterans' affairs.--The Senate Committee
on Veterans' Affairs shall report changes in laws within its
jurisdiction that provide direct spending (as defined in
section 250(c)(8) of the Balanced Budget and Emergency
Deficit Control Act of 1985) to reduce outlays $681,000,000
in fiscal year 2002 and $2,733,000,000 for the period of
fiscal years 1998 through 2002.
(b) Reconciliation of Revenue Reductions.--Not later than
June 27, 1997, the Senate Committee on Finance shall report
to the Senate a reconciliation bill proposing changes in laws
within its jurisdiction necessary to reduce revenues by not
more than $20,500,000,000 in fiscal year 2002 and
$85,000,000,000 for the period of fiscal years 1998 through
2002 and $250,000,000,000 for the period of fiscal years 1998
through 2007.
(c) Treatment of Congressional Pay-As-You-Go.--For purposes
of section 202 of House Concurrent Resolution 67 (104th
Congress), legislation which reduces revenues pursuant to a
reconciliation instruction contained in subsection (b) shall
be taken together with all other legislation enacted pursuant
to the reconciliation instructions contained in this
resolution when determining the deficit effect of such
legislation.
(d) Adjustments.--
(1) Deficit neutral adjustments.--Upon the reporting of
reconciliation legislation pursuant to subsection (a), or
upon the submission of a conference report thereon, and if
the Committee on Finance reduces the deficit by an amount
equal to or greater than the outlay reduction that would be
achieved pursuant to subsection (a)(5)(A), the Chairman of
the Committee on the Budget, with the concurrence and
agreement of the ranking minority member, may submit
appropriately revised reconciliation instructions to the
Committee on Finance to reduce the deficit, allocations,
limits, and aggregates if such revisions do not cause an
increase in the deficit for fiscal year 1998 and for the
period of fiscal years 1998 through 2002.
(2) Flexibility on adjustments.--
(A) In general.--If the adjustments authorized by paragraph
(1) involve a reduction in the revenue aggregates set forth
in this resolution, in lieu of revenue reductions, the
Chairman of the Committee on the Budget may make upward
adjustments to the discretionary spending limits in this
resolution, or any combination thereof.
(B) Limit.--The adjustments made pursuant to this
subsection shall not exceed $2,300,000,000 in fiscal year
1998 and $16,000,000,000 for the period of fiscal years 1998
through 2002.
TITLE II--BUDGETARY RESTRAINTS AND RULEMAKING

SEC. 201. DISCRETIONARY SPENDING LIMITS.

(a) Discretionary Limits.--In this section and for the
purposes of allocations made for the discretionary category
pursuant to section 302(a) or 602(a) of the Congressional
Budget Act of 1974, the term ``discretionary spending limit''
means--
(1) with respect to fiscal year 1998--
(A) for the defense category $269,000,000,000 in new budget
authority and $266,823,000,000 in outlays; and
(B) for the nondefense category $257,857,000,000 in new
budget authority and $286,445,000,000 in outlays;
(2) with respect to fiscal year 1999--
(A) for the defense category $271,500,000,000 in new budget
authority and $266,518,000,000 in outlays; and
(B) for the nondefense category $261,499,000,000 in new
budget authority and $292,803,000,000 in outlays;
(3) with respect to fiscal year 2000, for the discretionary
category $537,193,000,000 in new budget authority and
$564,265,000,000 in outlays;
(4) with respect to fiscal year 2001, for the discretionary
category $542,032,000,000 in new budget authority and
$564,396,000,000 in outlays; and
(5) with respect to fiscal year 2002, for the discretionary
category $551,074,000,000 in new budget authority and
$560,799,000,000 in outlays;

as adjusted for changes in concepts and definitions and
emergency appropriations.
(b) Point of Order in the Senate.--
(1) In general.--Except as provided in paragraph (2), it
shall not be in order in the Senate to consider--
(A) a revision of this resolution or any concurrent
resolution on the budget for fiscal years 1999, 2000, 2001,
and 2002 (or amendment, motion, or conference report on such
a resolution) that provides discretionary spending in excess
of the discretionary spending limit or limits for such fiscal
year; or
(B) any bill or resolution (or amendment, motion, or
conference report on such bill or resolution) for fiscal year
1998, 1999, 2000, 2001, or 2002 that would cause any of the
limits in this section (or suballocations of the
discretionary limits made pursuant to section 602(b) of the
Congressional Budget Act of 1974) to be exceeded.
(2) Exception.--
(A) In general.--This section shall not apply if a
declaration of war by the Congress is in effect or if a joint
resolution pursuant to section 258 of the Balanced Budget and
Emergency Deficit Control Act of 1985 has been enacted.
(B) Enforcement of discretionary limits in fy 1998.--Until
the enactment of reconciliation legislation pursuant to
subsections (a) and (b) of section 104 of this resolution--
(i) subparagraph (A) of paragraph (1) shall not apply; and
(ii) subparagraph (B) of paragraph (1) shall apply only
with respect to fiscal year 1998.
(c) Waiver.--This section may be waived or suspended in the
Senate only by the affirmative vote of three-fifths of the
Members, duly chosen and sworn.
(d) Appeals.--Appeals in the Senate from the decisions of
the Chair relating to any provision of this section shall be
limited to 1 hour, to be equally divided between, and
controlled by, the appellant and the manager of the
concurrent resolution, bill, or joint resolution, as the case
may be. An affirmative vote of three-fifths of the Members of
the Senate, duly chosen and sworn, shall be required in the
Senate to sustain an appeal of the ruling of the Chair on a
point of order raised under this section.
(e) Determination of Budget Levels.--For purposes of this
section, the levels of new budget authority, outlays, new
entitlement authority, revenues, and deficits for a fiscal
year shall be determined on the basis of estimates made by
the Committee on the Budget of the Senate.

SEC. 202. ALLOWANCE IN THE SENATE.

(a) Adjustments.--In the Senate, for fiscal year 1998,
1999, 2000, 2001, or 2002, upon the reporting of an
appropriations measure (or the submission of a conference
report thereon) that includes an appropriation with respect
to paragraph (1) or (2), the Chairman of the Committee on the
Budget shall increase the appropriate allocations, budgetary
aggregates, and discretionary limits by the amount of budget
authority in that measure that is the dollar equivalent, in
terms of Special Drawing Rights, of--
(1) an increase in the United States quota as part of the
International Monetary Fund Eleventh General Review of Quotas
(United States Quota); or
(2) any increase in the maximum amount available to the
Secretary of the Treasury pursuant to section 17 of the
Bretton Woods Agreement Act, as amended from time to time
(New Arrangements to Borrow).
(b) Committee Suballocations.--The Committee on
Appropriations of the Senate may report appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974 following the
adjustments made pursuant to subsection (a).

SEC. 203. ALLOWANCE IN THE SENATE FOR SECTION 8 HOUSING
ASSISTANCE.

(a) Adjustment for Discretionary Spending.--In the Senate,
for fiscal year 1998, upon the reporting of an appropriations
measure (or upon the submission of a conference report
thereon) that includes an appropriation for Section 8 Housing
Assistance which fully funds all contract renewal obligations
during that fiscal year, the Chairman of the Committee on the
Budget may increase the appropriate allocations in this
resolution by an amount that does not exceed $9,200,000,000
in budget authority and the amount of outlays flowing from
such budget authority.
(b) Committee Suballocations.--The Committee on
Appropriations of the Senate may report appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974 following the
adjustments made pursuant to subsection (a).

SEC. 204. ENVIRONMENTAL RESERVE.

(a) Adjustments for Mandatory Spending.--
(1) Allocations.--In the Senate, upon the reporting of
legislation (or upon the submission of a conference report
thereon) pursuant to subsection (b), the Chairman of the
Committee on the Budget may increase the allocation
pursuant to sections 302(a) and 602(a) of the
Congressional Budget Act of 1974 to the Committee on

[[Page S5059]]

Environment and Public Works by an amount that does not
exceed--
(A) $200,000,000 in budget authority and $200,000,000 in
outlays for fiscal year 1998; and
(B) $1,000,000,000 in budget authority and $1,000,000,000
in outlays for the period of fiscal years 1998 through 2002.
(2) Prior surplus.--For the purposes of section 202 of
House Concurrent Resolution 67 (104th Congress), legislation
reported (or the submission of a conference report thereon)
pursuant to paragraph (1) shall be taken together with all
other legislation enacted pursuant to section 104 of this
resolution.
(b) Limitations.--The adjustments made pursuant to this
section shall only be made for legislation that provides
funding to reform the Superfund program to facilitate the
cleanup of hazardous waste sites.

SEC. 205. PRIORITY FEDERAL LAND ACQUISITIONS AND EXCHANGES.

(a) Adjustment for Discretionary Spending.--In the Senate,
for fiscal year 1998, upon the reporting of an appropriations
measure (or upon the submission of a conference report
thereon) that includes an appropriation for the National Park
Service's Land Acquisition and State Assistance account at
the fiscal year 1998 request level (as submitted on February
6, 1997) and up to an additional $700,000,000 in budget
authority for priority Federal land acquisitions and
exchanges during that fiscal year, the Chairman of the
Committee on the Budget may increase the appropriate
allocations by an amount that does not exceed $700,000,000 in
budget authority and the amount of outlays flowing from such
budget authority.
(b) Committee Suballocations.--The Committee on
Appropriations of the Senate may report appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974 following the
adjustments made pursuant to subsection (a).

SEC. 206. ALLOWANCE IN THE SENATE FOR ARREARAGES.

(a) Adjustment for Discretionary Spending.--In the Senate,
for fiscal year 1998, 1999, and 2000, upon the reporting of
an appropriations measure (or upon the submission of a
conference report thereon) that includes an appropriation for
arrearages for international organizations, international
peacekeeping, and multilateral development banks during that
fiscal year, the Chairman of the Committee on the Budget may
increase the appropriate allocations, aggregates, and
discretionary spending limits in this resolution by an amount
that does not exceed--
(1) $415,000,000 in budget authority and the amount of
outlays flowing from such budget authority for fiscal year
1998;
(2) $1,227,000,000 in budget authority and the amount of
outlays flowing from such budget authority for fiscal year
1999; and
(3) $242,000,000 in budget authority and the amount of
outlays flowing from such budget authority for fiscal year
2000.
(b) Committee Suballocations.--The Committee on
Appropriations of the Senate may report appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974 following the
adjustments made pursuant to subsection (a).

SEC. 207. INTERCITY PASSENGER RAIL RESERVE FUND FOR FISCAL
YEARS 1998-2002.

(a) In General.--If legislation is enacted which generates
revenue increases or direct spending reductions to finance an
intercity passenger rail fund and to the extent that such
increases or reductions are not included in this concurrent
resolution on the budget, the appropriate budgetary levels
and limits may be adjusted if such adjustments do not cause
an increase in the deficit in this resolution.
(b) Establishing a Reserve.--
(1) Revisions.--After the enactment of legislation
described in subsection (a), the Chairman of the Committee on
the Budget may submit revisions to the appropriate
allocations and aggregates by the amount that provisions in
such legislation generates revenue increases or direct
spending reductions.
(2) Revenue increases or direct spending reductions.--Upon
the submission of such revisions, the Chairman of the
Committee on the Budget shall also submit the amount of
revenue increases or direct spending reductions such
legislation generates and the maximum amount available each
year for adjustments pursuant to subsection (c).
(c) Adjustments for Discretionary Spending.--
(1) Revisions to allocations and aggregates.--Upon either--
(A) the reporting of an appropriations measure, or when a
conference committee submits a conference report thereon,
that appropriates funds for the National Railroad Passenger
Corporation and funds from the intercity passenger rail fund;
or
(B) the reporting of an appropriations measure, or when a
conference committee submits a conference report thereon,
that appropriates funds from the intercity passenger rail
fund (funds having previously been appropriated for the
National Railroad Passenger Corporation for that same fiscal
year),

the Chairman of the Budget Committee shall submit increased
budget authority allocations, aggregates, and discretionary
limits for the amount appropriated for authorized
expenditures from the intercity passenger rail fund and the
outlays flowing from such budget authority.
(2) Revisions to suballocations.--The Committee on
Appropriations may submit appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974.
(d) Limitations.--
(1) In general.--The revisions made pursuant to subsection
(b) shall not be made--
(A) with respect to direct spending reductions, unless the
committee that generates the direct spending reductions is
within its allocations under sections 302(a) and 602(a) of
the Budget Act in this resolution (not including the direct
spending reductions envisioned in subsection (b)); and
(B) with respect to revenue increases, unless revenues are
at or above the revenue aggregates in this resolution (not
including the revenue increases envisioned in subsection
(b)).
(2) Budget authority.--The budget authority adjustments
made pursuant to subsection (c) shall not exceed the amounts
specified in subsection (b)(2) for a fiscal year.

SEC. 208. MASS TRANSIT RESERVE FUND FOR FISCAL YEARS 1998-
2002.

(a) In General.--If legislation is enacted which generates
revenue increases or direct spending reductions to finance
mass transit and to the extent that such increases or
reductions are not included in this concurrent resolution on
the budget, the appropriate budgetary levels and limits may
be adjusted if such adjustments do not cause an increase in
the deficit in this resolution.
(b) Establishing a Reserve.--
(1) Revisions.--After the enactment of legislation
described in subsection (a), the Chairman of the Committee on
the Budget may submit revisions to the appropriate
allocations and aggregates by the amount that provisions
in such legislation generates revenue increases or direct
spending reductions.
(2) Revenue increases or direct spending reductions.--Upon
the submission of such revisions, the Chairman of the
Committee on the Budget shall also submit the amount of
revenue increases or direct spending reductions such
legislation generates and the maximum amount available each
year for adjustments pursuant to subsection (c).
(c) Adjustments for Discretionary Spending.--
(1) Revisions to allocations and aggregates.--Upon the
reporting of an appropriations measure, or when a conference
committee submits a conference report thereon, that
appropriates funds for mass transit, the Chairman of the
Budget Committee shall submit increased budget authority
allocations, aggregates, and discretionary limits for the
amount appropriated for authorized expenditures from the mass
transit fund and the outlays flowing from such budget
authority.
(2) Revisions to suballocations.--The Committee on
Appropriations may submit appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974.
(d) Limitations.--
(1) In general.--The revisions made pursuant to subsection
(b) shall not be made--
(A) with respect to direct spending reductions, unless the
committee that generates the direct spending reductions is
within its allocations under sections 302(a) and 602(a) of
the Budget Act in this resolution (not including the direct
spending reductions envisioned in subsection (b)); and
(B) with respect to revenue increases, unless revenues are
at or above the revenue aggregates in this resolution (not
including the revenue increases envisioned in subsection
(b)).
(2) Budget authority.--The budget authority adjustments
made pursuant to subsection (c) shall not exceed the amounts
specified in subsection (b)(2) for a fiscal year.

SEC. 209. HIGHWAY RESERVE FUND FOR FISCAL YEARS 1998-2002.

(a) In General.--If legislation generates revenue increases
or direct spending reductions to finance highways and to the
extent that such increases or reductions are not included in
this concurrent resolution on the budget, the appropriate
budgetary levels and limits may be adjusted if such
adjustments do not cause an increase in the deficit in this
resolution.
(b) Adjustments for Budget Authority.--Upon the reporting
of legislation (the offering of an amendment thereto or
conference report thereon) that reduces direct non-highway
spending or increases revenues for a fiscal year or years,
the Chairman of the Committee on the Budget shall submit
revised budget authority allocations and aggregates by an
amount that equals the amount such legislation reduces direct
spending or increases revenues.
(c) Establishing a Reserve.--
(1) Revisions.--After the enactment of legislation
described in subsection (a), the Chairman of the Committee on
the Budget may submit revisions to the appropriate
allocations and aggregates by the amount that provisions in
such legislation generates revenue increases or direct non-
highway spending reductions.
(2) Revenue increases or direct spending reductions.--Upon
the submission of such revisions, the Chairman of the
Committee on the Budget shall also submit the amount of
revenue increases or direct non-highway spending reductions
such legislation generates and the maximum amount available
each year for adjustments pursuant to subsection (d).
(d) Adjustments for Discretionary Spending.--
(1) Revisions to allocations and aggregates.--Upon the
reporting of an appropriations measure, or when a conference
committee submits a conference report thereon, that
appropriates funds for highways, the Chairman of the
Committee on the Budget shall submit increased outlay
allocations, aggregates, and discretionary limits for the
amount of outlays flowing from the additional obligational
authority provided in such bill.
(2) Revisions to suballocations.--The Committee on
Appropriations may submit appropriately revised
suballocations pursuant to sections 302(b)(1) and 602(b)(1)
of the Congressional Budget Act of 1974.
(e) Limitations.--

[[Page S5060]]

(1) In general.--The revisions made pursuant to subsection
(c) shall not be made--
(A) with respect to direct non-highway spending reductions,
unless the committee that generates the direct spending
reductions is within its allocations under section 302(a) and
602(a) of the Budget Act in this resolution (not including
the direct spending reductions envisioned in subsection (c));
and
(B) with respect to revenue increases, unless revenues are
at or above the revenue aggregates in this resolution (not
including the revenue increases envisioned in subsection
(c)).
(2) Outlays.--The outlay adjustments made pursuant to
subsection (d) shall not exceed the amounts specified in
subsection (c)(2) for a fiscal year.

SEC. 210. EXERCISE OF RULEMAKING POWERS.

The Congress adopts the provisions of this title--
(1) as an exercise of the rulemaking power of the Senate
and the House of Representatives, respectively, and as such
they shall be considered as part of the rules of each House,
or of that House to which they specifically apply, and such
rules shall supersede other rules only to the extent that
they are inconsistent therewith; and
(2) with full recognition of the constitutional right of
either House to change those rules (so far as they relate to
that House) at any time, in the same manner, and to the same
extent as in the case of any other rule of that House.
TITLE III--SENSE OF THE SENATE

SEC. 301. SENSE OF THE SENATE ON LONG TERM ENTITLEMENT
REFORMS, INCLUDING ACCURACY IN DETERMINING
CHANGES IN THE COST OF LIVING.

(a) Findings.--
(1) Entitlement reforms.--The Senate finds that with
respect to long term entitlement reforms--
(A) entitlement spending continues to grow dramatically as
a percent of total Federal spending, rising from fifty-six
percent of the budget in 1987 to an estimated seventy-three
percent of the budget in 2007;
(B) this growth in mandatory spending poses a long-term
threat to the United States economy because it crowds out
spending for investments in education, infrastructure,
defense, law enforcement and other programs that enhance
economic growth;
(C) in 1994, the Bipartisan Commission on Entitlement and
Tax Reform concluded that if no changes are made to current
entitlement laws, all Federal revenues will be spent on
entitlement programs and interest on the debt by the year
2012;
(D) the Congressional Budget Office has also recently
issued a report that found that pressure on the budget from
demographics and rising health care costs will increase
dramatically after 2002; and
(E) making significant entitlement changes will
significantly benefit the economy, and will forestall the
need for more drastic tax and spending decisions in future
years.
(2) CPI.--The Senate finds that with respect to accuracy in
determining changes in the cost of living--
(A) the Final Report of the Senate Finance Committee's
Advisory Commission to study the CPI has concluded that the
Consumer Price Index overstates the cost of living in the
United States by 1.1 percentage points;
(B) the overstatement of the cost of living by the Consumer
Price Index has been recognized by economists since at least
1961, when a report noting the existence of the overstatement
was issued by a National Bureau of Economic Research
Committee, chaired by Professor George J. Stigler;
(C) Congress and the President, through the indexing of
Federal tax brackets, social security benefits, and other
Federal program benefits, have undertaken to protect
taxpayers and beneficiaries of such programs from the erosion
of purchasing power due to inflation; and
(D) the overstatement of the cost of living increases the
deficit and undermines the equitable administration of
Federal benefits and tax policies.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions in this resolution assume that--
(1) Congress and the President should continue working to
enact structural entitlement reforms in the 1997 budget
agreement and in subsequent legislation;
(2) Congress and the President must find the most accurate
measure of the change in the cost of living in the United
States, and should work in a bipartisan manner to implement
any changes that are necessary to achieve an accurate
measure; and
(3) Congress and the President must work to ensure that the
1997 budget agreement not only keeps the unified budget in
balance after 2002, but that additional measures should be
taken to begin to achieve substantial surpluses which will
improve the economy and allow our nation to be ready for the
retirement of the baby boom generation in the year 2012.

SEC. 302. SENSE OF THE SENATE ON TACTICAL FIGHTER AIRCRAFT
PROGRAMS.

(a) Findings.--The Senate finds that--
(1) the Department of Defense has proposed to modernize the
United States tactical fighter aircraft force through three
tactical fighter procurement programs, including the F/A-18
E/F aircraft program of the Navy, the F-22 aircraft program
of the Air Force, and the Joint Strike Fighter aircraft
program for the Navy, Air Force, and Marine Corps;
(2) the General Accounting Office, the Congressional Budget
Office, the Chairman of the Joint Chiefs of Staff, the Under
Secretary of Defense for Acquisition and Technology, and
several Members of Congress have publicly stated that, given
the current Department of Defense budget for procurement, the
Department of Defense's original plan to buy over 4,400 F/A-
18 E/F aircraft, F-22 aircraft, and Joint Strike Fighter
aircraft at a total program cost in excess of
$350,000,000,000 was not affordable;
(3) the F/A-18 E/F, F-22, and the Joint Strike Fighter
tactical fighter programs will be competing for a limited
amount of procurement funding with numerous other aircraft
acquisition programs, including the Comanche helicopter
program, the V-22 Osprey aircraft program, and the C-17
aircraft program, as well as for the necessary replacement of
other aging aircraft such as the KC-135, the C-5A, the F-117,
and the EA-6B aircraft; and
(4) the 1997 Department of Defense Quadrennial Defense
Review has recommended reducing the F/A-18 E/F program buy
from 1,000 aircraft to 548, and reducing the F-22 program buy
from 438 to 339.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that, within 30
days, the Department of Defense should transmit to Congress
detailed information pertaining to the implementation of this
revised acquisition strategy so that the Congress can
adequately evaluate the extent to which the revised
acquisition strategy is tenable and affordable given the
projected spending levels contained in this budget
resolution.

SEC. 303. SENSE OF THE SENATE REGARDING CHILDREN'S HEALTH
COVERAGE.

(a) Findings.--The Senate finds that--
(1) of the estimated 10 million uninsured children in the
United States, over 1.3 million have at least one parent who
is self-employed and all other uninsured children are
dependents of persons who are employed by another, or
unemployed;
(2) these 1.3 million uninsured kids comprise approximately
22 percent of all children with self-employed parents, and
they are a significant 13 percent of all uninsured children;
(3) the remaining uninsured children are in families where
neither parent is self-employed and comprise 13 percent of
all children in families where neither parent is self-
employed;
(4) children in families with a self-employed parent are
therefore more likely to be uninsured than children in
families where neither parent is self-employed; and
(5) the current disparity in the tax law reduces the
affordability of health insurance for the self-employed and
their families, hindering the ability of children to receive
essential primary and preventive care services.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that from
resources available in this budget resolution, a portion
should be set aside for an immediate 100 percent
deductibility of health insurance costs for the self-
employed. Full-deductibility of health expenses for the self-
employed would make health insurance more attractive and
affordable, resulting in more dependents being covered. The
government should not encourage parents to forgo private
insurance for a government-run program.

SEC. 304. SENSE OF THE SENATE ON A MEDICAID PER CAPITA CAP.

It is the sense of the Senate that in order to meet deficit
reduction targets in this resolution with respect to
medicaid--
(1) the per capita cap will not be used as a method for
meeting spending targets; and
(2) the per capita cap represents a significant structural
change that could jeopardize the quality of care for
children, the disabled, and senior citizens.

SEC. 305. SENSE OF THE SENATE THAT ADDED SAVINGS GO TO
DEFICIT REDUCTION.

(a) Findings.--The Congress finds that--
(1) balancing the budget will bring numerous economic
benefits for the United States economy and American workers
and families, including improved economic growth and lower
interest rates;
(2) the fiscal year 1998 budget resolution crafted pursuant
to an agreement reached between the Congress and the
Administration purports to achieve balance in the year 2002;
(3) the deficit estimates contained in this resolution may
not conform to the actual deficits in subsequent years, which
make it imperative that any additional savings are realized
be devoted to deficit reduction;
(4) the Senate's ``pay-as-you-go'' point of order prohibits
crediting savings from updated economic or technical data as
an offset for legislation that increases the deficit, and
ensures these savings are devoted to deficit reduction; and
(5) Congress and the Administration must ensure that the
deficit levels contained in this budget are met and, if
actual deficits prove to be lower than projected, the
additional savings are used to balance the budget on or
before the year 2002.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that--
(1) legislation enacted pursuant to this resolution must
ensure that the goal of a balanced budget is achieved on or
before fiscal year 2002; and
(2) if the actual deficit is lower than the projected
deficit in any upcoming fiscal year, the added savings should
be devoted to further deficit reduction.

SEC. 306. SENSE OF THE SENATE ON FAIRNESS IN MEDICARE.

(a) Findings.--The Congress finds that--
(1) the Trustees of the Medicare Trust Funds recently
announced that medicare's Hospital Insurance (HI) Trust Fund
is headed for bankruptcy in 2001, and in 1997, HI will run a
deficit of $26,000,000,000 and add $56,000,000,000 annually
to the Federal deficit by 2001;
(2) the Trustees also project that Supplementary Medical
Insurance (SMI), will grow

[[Page S5061]]

twice as fast as the economy and the taxpayers' subsidy to
keep the SMI from bankruptcy will grow from $58,000,000,000
to $89,000,000,000 annually from 1997 through 2001;
(3) the Congressional Budget Office reports that when the
baby-boom generation begins to receive social security
benefits and is eligible for medicare in 2008, the Federal
budget will face intense pressure, resulting in mounting
deficits and erosion of future economic growth;
(4) long-term solutions to address the financial and
demographic problems of medicare are urgently needed to
preserve and protect the medicare trust funds;
(5) these solutions to address the financial and
demographic problems of medicare are urgently needed to
preserve and protect the medicare trust funds;
(6) reform of the medicare program should ensure equity and
fairness for all medicare beneficiaries, and offer
beneficiaries more choice of private health plans, to promote
efficiency and enhance the quality of health care;
(7) all Americans pay the same payroll tax of 2.9 percent
to the medicare trust funds, and they deserve the same
choices and services regardless of where they retire;
(8) however, under the currently adjusted-average-per-
capita cost (AAPCC), some counties receive 2.5 times more in
medicare reimbursements than others;
(9) this inequity in medicare reimbursement jeopardizes the
quality of medicare services of rural beneficiaries and
penalizes the most efficient and effective medicare service
providers;
(10) in some states, the result has been the absence of
health care choices beyond traditional, fee-for-service
medicine for medicare beneficiaries, which in other counties
and states plan providers may be significantly over-
compensated, adding to medicare's fiscal instability; and
(11) ending the practice of basing payments to risk
contract plans on local fee-for-service medical costs will
help correct these inequities, mitigate unnecessary cost in
the program, and begin the serious, long-term restructuring
of medicare.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that the
Finance Committee should strongly consider the following
elements for medicare reform--
(1) any medicare reform package should include measures to
address the inequity in medicare reimbursement to risk
contract plans;
(2) medicare should use a national update framework rather
than local fee-for-service spending increases to determine
the annual changes in risk plan payment rates;
(3) an adequate minimum payment rate should be provided for
health plans participating in medicare risk contract
programs;
(4) the geographic variation in medicare payment rates must
be reduced over time to raise the lower payment areas closer
to the average while taking into account actual differences
in input costs that exist from region to regional;
(5) medicare managers in consultation with plan providers
and patient advocates should pursue competitive bidding
programs in communities where data indicate risk contract
payments are substantially excessive and when plan choices
would not diminish by such a bidding process; and
(6) medicare should phase in the use of risk adjusters
which take account of health status so as to address
overpayment to some plans.

SEC. 307. SENSE OF THE SENATE REGARDING ASSISTANCE TO
LITHUANIA AND LATVIA.

(a) Findings.--The Senate finds that--
(1) Lithuania and Latvia reestablished democracy and free
market economies when they regained their freedom from the
Soviet Union;
(2) Lithuania and Latvia, which have made significant
progress since regaining their freedom, are still struggling
to recover from the devastation of 50 years of communist
domination;
(3) the United States, which never recognized the illegal
incorporation of Lithuania and Latvia into the Soviet Union,
has provided assistance to strengthen democratic institutions
and free market reforms in Lithuania and Latvia since 1991;
(4) the people of the United States enjoy close and
friendly relations with the people of Lithuania and Latvia;
(5) the success of democracy and free market reform in
Lithuania and Latvia is important to the security and
economic progress of the United States; and
(6) the United States as well as Lithuania and Latvia would
benefit from the continuation of assistance which helps
Lithuania and Latvia to implement commercial and trade law
reform, sustain private sector development, and establish
well-trained judiciaries.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that--
(1) adequate assistance should be provided to Lithuania and
Latvia in fiscal year 1998 to continue the progress they have
made; and
(2) assistance to Lithuania and Latvia should be continued
beyond fiscal year 1998 as they continue to build democratic
and free market institutions.

SEC. 308. SENSE OF THE SENATE REGARDING A NATIONAL COMMISSION
ON HIGHER EDUCATION.

It is the sense of the Senate that the provisions of this
resolution assure that a national commission should be
established to study and make specific recommendations
regarding the extent to which increases in student financial
aid, and the extent to which Federal, State, and local laws
and regulations, contribute to increases in college and
university tuition.

SEC. 309. SENSE OF THE SENATE ON LOCKBOX.

It is the Sense of the Senate that the provisions of this
resolution assume that to ensure all savings from medicare
reform are used to keep the medicare program solvent, the
Treasury Secretary should credit the Medicare Hospital
Insurance Trust Fund (Part A) with government securities
equal to any savings from Medicare Supplemental Medical
Insurance (Part B) reforms enacted pursuant to the
reconciliation instructions contained in this budget
resolution.

SEC. 310. SENSE OF THE SENATE ON THE EARNED INCOME CREDIT.

(a) Findings.--The Senate finds that--
(1) an April 1997 study by the Internal Revenue Service of
Earned Income Credit (EIC) filers for tax year 1994 revealed
that over $4,000,000,000 of the $17,000,000,000 spent on the
EIC for that year was erroneously claimed and paid by the
IRS, resulting in a fraud and error rate of 25.8 percent;
(2) the IRS study further concluded that EIC reforms
enacted by the One Hundred Fourth Congress will only lower
the fraud error rate to 20.7 percent, meaning over
$23,000,000,000 will be wasted over the next five years; and
(3) the President's recent proposals to combat EIC fraud
and error contained within this budget resolution are
estimated to save $124,000,000 in scoreable savings over the
next five years and additional savings from deterrent
effects.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that the
President should propose and Congress should enact additional
programmatic changes sufficient to ensure that the primary
purpose of the EIC to encourage work over welfare is achieved
without wasting billions of taxpayer dollars on fraud and
error.

SEC. 311. SENSE OF THE SENATE ON REPAYMENT OF THE FEDERAL
DEBT.

(a) Findings.--The Senate finds that--
(1) Congress and the President have a basic moral and
ethical responsibility to future generations to repay the
Federal debt, including money borrowed from the Social
Security Trust Fund;
(2) the Congress and the President should enact a law that
creates a regimen for paying off the Federal debt within 30
years; and
(3) if spending growth were held to a level one percentage
point lower than projected growth in revenues, then the
Federal debt could be repaid within 30 years.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that--
(1) the President's annual budget submission to Congress
should include a plan for repayment of the Federal debt
beyond the year 2002, including the money borrowed from the
Social Security Trust Fund; and
(2) the plan should specifically explain how the President
would cap spending growth at a level one percentage point
lower than projected growth in revenues.

SEC. 312. SENSE OF THE SENATE SUPPORTING LONG-TERM
ENTITLEMENT REFORMS.

(a) Findings.--The Senate finds that the resolution assumes
the following--
(1) entitlement spending has risen dramatically over the
last thirty-five years;
(2) in 1963, mandatory spending (i.e., entitlement spending
and interest on the debt) made up 29.6 percent of the budget,
this figure rose to 61.4 percent by 1993 and is expected to
reach 70 percent shortly after the year 2000;
(3) this mandatory spending is crowding out spending for
the traditional ``discretionary'' functions of Government
like clean air and water, a strong national defense, parks
and recreation, education, our transportation system, law
enforcement, research and development and other
infrastructure spending;
(4) taking significant steps sooner rather than later to
reform entitlement spending will not only boost economic
growth in this country, it will also prevent the need for
drastic tax and spending decisions in the next century.
(b) Sense of the Senate.--It is the Sense of the Senate
that the levels in this budget resolution assume that
Congress and the President should work to enact structural
reforms in entitlement spending in 1997 and beyond which
sufficiently restrain the growth of mandatory spending in
order to keep the budget in balance over the long term,
extend the solvency of the Social Security and Medicare Trust
Funds, avoid crowding out funding for basic Government
functions and that every effort should be made to hold
mandatory spending to no more than 70 percent of the budget.

SEC. 313. SENSE OF THE SENATE ON DISASTER ASSISTANCE FUNDING.

(a) Findings.--The Senate finds that--
(1) emergency spending adds to the deficit and total
spending;
(2) the Budget Enforcement Act of 1990 exempts emergency
spending from the discretionary spending caps and pay-go
requirements;
(3) the Budget Enforcement Act of 1990 expires in 1998 and
needs to be extended;
(4) since the enactment of the Budget Enforcement Act,
Congress and the President have approved an average of
$5,800,000,000 per year in emergency spending;
(5) a natural disaster in any particular State is
unpredictable, by the United States is likely to experience a
natural disaster almost every year.
(b) Sense of the Senate.--It is the sense of the Senate
that the functional totals underlying this concurrent
resolution on the budget assume that the Congress should
consider in the extension of the Budget Enforcement Act and
in appropriations Acts--
(1) provisions that budget for emergencies or that require
emergency spending to be offset;
(2) provisions that provide flexibility to meet emergency
funding requirements associated with natural disasters;
(3) Congress and the President should consider
appropriating at least $5,000,000,000 every year within
discretionary limits to provide natural disaster relief;

[[Page S5062]]

(4) Congress and the President should not designate any
emergency spending for natural disaster relief until such
amounts provided in regular appropriations are exhausted.

SEC. 314. SENSE OF THE SENATE ON ENFORCEMENT OF BIPARTISAN
BUDGET AGREEMENT.

(a) Findings.--The Senate finds that--
(1) the bipartisan budget agreement is contingent upon--
(A) favorable economic conditions for the next 5 years; and
(B) accurate estimates of the fiscal impacts of assumptions
in this resolution; and
(C) enactment of legislation to reduce the deficit;
(2) if either of the conditions in paragraph (1) are not
met, our ability to achieve a balanced budget by 2002 will be
jeopardized.
(b) Sense of the Senate.--It is the sense of the Senate
that the functional totals and limits in this resolution
assume that--
(1) reconciliation legislation should include legislation
to enforce the targets set forth in the budget process
description included in the agreement and to ensure the
balanced budget goal is met; and
(2) such legislation shall--
(A) establish procedures to ensure those targets are met
every year;
(B) require that the President's annual budget and annual
Congressional concurrent resolutions on the budget comply
with those targets every year;
(C) consider provisions which provide that if the deficit
is below or the surplus is above the deficits projected in
the agreement in any year, such savings are locked in for
deficit and debt reduction; and
(D) consider provisions which include a provision to budget
for and control emergency spending in order to prevent the
use of emergencies to evade the budget targets.

SEC. 315. SENSE OF THE SENATE REGARDING THE NATIONAL
INSTITUTES OF HEALTH.

(a) Findings.--Congress finds that--
(1) heart disease was the leading cause of death for both
men and women in every year from 1970 to 1993;
(2) mortality rates for individuals suffering from prostate
cancer, skin cancer, and kidney cancer continue to rise;
(3) the mortality rate for African American women suffering
from diabetes is 134 percent higher than the mortality rate
of Caucasian women suffering from diabetes;
(4) asthma rates for children increased 58 percent from
1982 to 1992;
(5) nearly half of all American women between the ages of
65 and 75 reported having arthritis;
(6) AIDS is the leading cause of death for Americans
between the ages of 24 and 44;
(7) the Institute of Medicine has described United States
clinical research to be ``in a state of crisis'' and the
National Academy of Sciences concluded in 1994 that ``the
present cohort of clinical investigators is not adequate'';
(8) biomedical research has been shown to be effective in
saving lives and reducing health care expenditures;
(9) research sponsored by the National Institutes of Health
has contributed significantly to the first overall reduction
in cancer death rates since recordkeeping was instituted;
(10) research sponsored by the National Institutes of
Health has resulted in the identification of genetic
mutations for osteoporosis; Lou Gehrig's Disease, cystic
fibrosis, and Huntington's Disease; breast, skin and prostate
cancer; and a variety of other illnesses;
(11) research sponsored by the National Institutes of
Health has been key to the development of Magnetic Resonance
Imaging (MRI) and Positron Emission Tomography (PET) scanning
technologies;
(12) research sponsored by the National Institutes of
Health has developed effective treatments for Acute
Lymphoblastic Leukemia (ALL). Today, 80 percent of children
diagnosed with Acute Lymphoblastic Leukemia are alive and
free of the disease after 5 years; and
(13) research sponsored by the National Institutes of
Health contributed to the development of a new, cost-saving
cure for peptic ulcers.
(b) Sense of the Senate.--It is the sense of the Senate
that this Resolution assumes that--
(1) appropriations for the National Institutes of Health
should be increased by 100 percent over the next 5 fiscal
years; and
(2) appropriations for the National Institutes of Health
should be increased by $2,000,000,000 in fiscal year 1998
over the amount appropriated in fiscal year 1997.

SEC. 316. SENSE OF THE SENATE REGARDING CERTAIN ELDERLY LEGAL
ALIENS.

It is the sense of the Senate that the provisions of this
resolution assume that--
(1) the Committee on Finance will include in its
recommendations to the Committee on the Budget of the Senate
changes in laws within the jurisdiction of the Committee on
Finance that allow certain elderly, legal immigrants who will
cease to receive benefits under the supplemental security
income program as a result of the Personal Responsibility and
Work Opportunity Reconciliation Act of 1996 (Public Law 104-
193; 110 Stat. 2105) to continue to receive benefits during a
redetermination or reapplication period to determine if such
aliens would qualify for such benefits on the basis of being
disabled; and
(2) the Committee on Finance in developing these
recommendations should offset the additional cost of this
proposal out of other programs within the jurisdiction of the
Committee on Finance.

SEC. 317. SENSE OF THE SENATE REGARDING RETROACTIVE TAXES.

(a) Findings.--The Senate finds that--
(1) in general, the practice of increasing a tax
retroactively is fundamentally unfair to taxpayers; and
(2) retroactive taxation is disruptive to families and
small business in their ability to plan and budget.
(b) Sense of the Senate.--It is the sense of the Senate
that the levels in this budget resolution assume that--
(1) except for closing tax loopholes, no revenues should be
generated from any retroactively increased tax; and
(2) the Congress and the President should work together to
ensure that any revenue generating proposal contained within
reconciliation legislation pursuant to this concurrent
resolution proposal, except those proposals closing tax
loopholes, should take effect prospectively.

SEC. 318. SENSE OF THE SENATE ON SOCIAL SECURITY AND
BALANCING THE BUDGET.

(a) Findings.--The Senate finds that--
(1) this budget resolution is projected to balance the
unified budget of the United States in fiscal year 2002;
(2) section 13301 of the Budget Enforcement Act of 1990
requires that the deficit be computed without counting the
annual surpluses of the Social Security Trust Funds; and
(3) if the deficit were calculated according to the
requirements of section 13301, this budget resolution would
be projected to result in a deficit of $108,700,000,000 in
fiscal year 2002.
(b) Sense of the Senate.--It is the sense of the Senate
that the assumptions underlying this budget resolution assume
that after balancing the unified Federal budget, the Congress
should continue efforts to reduce the on-budget deficit, so
that the Federal budget will be balanced without counting
social security surpluses.

SEC. 319. SENSE OF THE SENATE SUPPORTING SUFFICIENT FUNDING
FOR VETERANS PROGRAMS AND BENEFITS.

(a) Findings.--The Senate finds that--
(1) veterans and their families represent approximately 27
percent of the United States population;
(2) more than 20 million of our 26 million living veterans
served during wartime, sacrificing their freedom so that we
may have ours; and
(3) veterans have earned the benefits promised to them.
(b) Sense of the Senate.--It is the sense of the Senate
that--
(1) the assumptions underlying this Budget Resolution
assume that the 602(b) allocation to the Department of
Veterans Affairs will be sufficient in fiscal year 1998 to
fully fund all discretionary veterans programs, including
medical care; and
(2) funds collected from legislation to improve the
Department of Veterans Affairs' ability to collect and retain
reimbursement from third-party payers ought to be used to
supplement, not supplant, an adequate appropriation for
medical care.

SEC. 320. SENSE OF CONGRESS ON FAMILY VIOLENCE OPTION
CLARIFYING AMENDMENT.

(a) Findings.--Congress finds the following:
(1) Domestic violence is the leading cause of physical
injury to women. The Department of Justice estimates that
over 1,000,000 violent crimes against women are committed by
intimate partners annually.
(2) Domestic violence dramatically affects the victim's
ability to participate in the workforce. A University of
Minnesota survey reported that \1/4\ of battered women
surveyed had lost a job partly because of being abused and
that over \1/2\ of these women had been harassed by their
abuser at work.
(3) Domestic violence is often intensified as women seek to
gain economic independence through attending school or
training programs. Batterers have been reported to prevent
women from attending these programs or sabotage their efforts
at self-improvement.
(4) Nationwide surveys of service providers prepared by the
Taylor Institute of Chicago, Illinois, document, for the
first time, the interrelationship between domestic violence
and welfare by showing that from 34 percent to 65 percent of
AFDC recipients are current or past victims of domestic
violence.
(5) Over \1/2\ of the women surveyed stayed with their
batterers because they lacked the resources to support
themselves and their children. The surveys also found that
the availability of economic support is a critical factor in
poor women's ability to leave abusive situations that
threaten them and their children.
(6) The restructuring of the welfare programs may impact
the availability of the economic support and the safety net
necessary to enable poor women to flee abuse without risking
homelessness and starvation for their families.
(7) In recognition of this finding, the Committee on the
Budget of the Senate in considering the 1997 Resolution on
the budget of the United States unanimously adopted a sense
of the Congress amendment concerning domestic violence and
Federal assistance. Subsequently, Congress adopted the family
violence option amendment as part of the Personal
Responsibility and Work Opportunity Reconciliation Act of
1996.
(8) The family violence option gives States the flexibility
to grant temporary waivers from time limits and work
requirements for domestic violence victims who would suffer
extreme hardship from the application of these provisions.
These waivers were not intended to be included as part of the
permanent 20 percent hardship exemption.
(9) The Department of Health and Human Services has been
slow to issue regulations regarding this provision. As a
result, States are hesitant to fully implement the family
violence option fearing that it will interfere with the 20
percent hardship exemption.
(10) Currently 15 States have opted to include the family
violence option in their welfare plans, and 13 other States
have included some type of domestic violence provisions in
their plans.

[[Page S5063]]

(b) Sense of Congress.--It is the sense of Congress that
the provisions of this Resolution assume that--
(1) States should not be subject to any numerical limits in
granting domestic violence good cause waivers under section
402(a)(7)(A)(iii) of the Social Security Act (42 U.S.C.
602(a)(7)(A)(iii)) to individuals receiving assistance, for
all requirements where compliance with such requirements
would make it more difficult for individuals receiving
assistance to escape domestic violence; and
(2) any individual who is granted a domestic violence good
cause waiver by a State shall not be included in the States'
20 percent hardship exemption under section 408(a)(7) of the
Social Security Act (42 U.S.C. 608(a)(7)).

SEC. 321. SENSE OF THE SENATE ON TAX CUTS.

It is the sense of the Senate that the Concurrent
Resolution on the Budget assumes that--
(1) a substantial majority of the tax cut benefits provided
in the tax reconciliation bill will go to middle class
working families earning less than approximately $100,000 per
year; and
(2) the tax cuts in the tax reconciliation bill will not
cause revenue losses to increase significantly in years after
2007.

SEC. 322. SENSE OF THE SENATE REGARDING ASSISTANCE TO AMTRAK.

(a) Findings.--The Senate finds that--
(1) Amtrak is in a financial crisis, with growing and
substantial debt obligations approaching $2,000,000,000;
(2) Amtrak has not been authorized since 1994;
(3) the Senate Committee on Commerce, Science, and
Transportation favorably reported legislation to reform
Amtrak during the last two Congresses, but no legislation was
enacted;
(4) the Finance Committee favorably reported legislation in
the last Congress that created a dedicated trust fund for
Amtrak, but no legislation was enacted;
(5) in 1997 Amtrak testified before the Congress that it
cannot survive beyond 1998 without comprehensive legislative
reforms and a dedicated source of capital funding; and
(6) Congress is obligated to invest Federal tax dollars
responsibly and to reduce waste and inefficiency in Federal
programs, including Amtrak.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that:
(1) Legislative reform is urgently needed to address
Amtrak's financial and operational problems.
(2) It is fiscally irresponsible for Congress to allocate
additional Federal dollars to Amtrak, and to distribute money
from a new trust fund, without providing reforms requested by
Amtrak to address its precarious financial situation.
(3) The distribution of money from any new fund to finance
an intercity rail passenger fund should be implemented in
conjunction with legislation to reauthorize and reform the
National Rail Passenger Corporation.

SEC. 323. SENSE OF THE SENATE REGARDING THE PROTECTION OF
CHILDREN'S HEALTH.

(a) Findings.--The Senate makes the following findings:
(1) Today's children and the next generation of children
are the prime beneficiaries of a balanced Federal budget.
Without a balanced budget, today's children will bear the
increasing burden of the Federal debt. Continued deficit
spending would doom future generations to slower economic
growth, higher taxes, and lower living standards.
(2) The health of children is essential to the future
economic and social well-being of the Nation.
(3) The medicaid program provides health coverage for over
17,000,000 children, or 1 out of every 4 children.
(4) While children represent \1/2\ of all individuals
eligible for medicaid, children account for less than 25
percent of expenditures under the medicaid program.
(5) Disproportionate share hospital (DSH) funding under the
medicaid program has allowed States to provide health care
services to thousands of uninsured pregnant women and
children. DSH funding under the medicaid program is critical
for these populations.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that the health
care needs of low-income pregnant women and children should
be a top priority. Careful study must be made of the impact
of medicaid disproportionate share hospital (DSH) reform
proposals on children's health and on vital sources of care,
including children's hospitals. Any restrictions on DSH
funding under the medicaid program should not harm State
medicaid coverage of children and pregnant women.

SEC. 324. DEPOSIT OF ALL FEDERAL GASOLINE TAXES INTO THE
HIGHWAY TRUST FUND.

(a) Findings.--The Senate makes the following findings:
(1) Since 1956, Federal gasoline excise tax revenues have
generally been deposited in the Highway Trust Fund and
reserved for transportation uses.
(2) In 1993, Congress and the President enacted the first
permanent increase in the Federal gasoline excise tax which
was dedicated to general revenues, not the Highway Trust
Fund.
(3) Over the next five years, approximately $7,000,000,000
per year in Federal gasoline excise tax revenues will be
deposited in the general fund of the Treasury, rather than
the Highway Trust Fund.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions in this resolution assume that Congress
should in the extension of the Budget Enforcement Act, ISTEA
reauthorization, appropriations Acts, and in any revenue
bills, that all revenues from Federal gasoline excise taxes,
including amounts dedicated to general revenues in 1993,
should be dedicated to the Highway Trust Fund so that such
taxes may be used for the purpose to which they have
historically been dedicated, promoting transportation
infrastructure and building roads.

SEC. 325. SENSE OF THE SENATE EARLY CHILDHOOD EDUCATION.

(a) Findings.--The Senate finds the following:
(1) Scientific research on the development of the brain has
confirmed that the early childhood years, particularly from
birth to the age of 3, are critical to children's
development.
(2) Studies repeatedly have shown that good quality child
care helps children develop well, enter school ready to
succeed, improve their skills, cognitive abilities and
socioemotional development, improve classroom learning
behavior, and stay safe while their parents work. Further,
quality early childhood programs can positively affect
children's long-term success in school achievement, higher
earnings as adults, decrease reliance on public assistance
and decrease involvement with the criminal justice system.
(3) The first of the National Education Goals, endorsed by
the Nation's governors, passed by Congress and signed into
law by President Bush, stated that by the year 2000, every
child should enter school ready to learn and that access to a
high quality early childhood education program was integral
to meeting this goal.
(4) According to data compiled by the RAND Corporation,
while 90 percent of human brain growth occurs by the age of
3, public spending on children in that age range equals only
8 percent of spending on all children. A vast majority of
public spending on children occurs after the brain has gone
through its most dramatic changes, often to correct problems
that should have been addressed during early childhood
development.
(5) According to the Department of Education, of
$29,400,000,000 in current estimated education expenditures,
only $1,500,000,000, or 5 percent, is spent on children from
birth to age 5. The vast majority is spent on children over
age 5.
(6) A new commitment to quality child care and early
childhood education is a necessary response to the fact that
children from birth to the age of 3 are spending more time in
care away from their homes. Almost 60 percent of women in the
workforce have children under the age of 3 requiring care.
(7) Many States and communities are currently experimenting
with innovative programs directed at early childhood care and
education in a variety of care settings, including the home.
States and local communities are best able to deliver
efficient, cost-effective services, but while such programs
are long on demand, they are short on resources. Additional
Federal resources should not create new bureaucracy, but
build on successful locally driven efforts.
(b) Sense of the Senate.--It is the sense of the Senate
that the budget totals and levels in this resolution assume
that funds ought to be directed toward increasing the supply
of quality child care, early childhood education, and teacher
and parent training for children from birth through age 3.

SEC. 326. HIGHWAY TRUST FUND NOT TAKEN INTO ACCOUNT FOR
DEFICIT PURPOSES.

It is the sense of the Senate that the assumptions
underlying this budget resolution assume that the Congress
should consider legislation to exclude the receipts and
disbursements of the Highway Trust Fund from the totals of
the Budget of the United States Government.

SEC. 327. AIRPORT AND AIRWAY TRUST FUND NOT TAKEN INTO
ACCOUNT FOR DEFICIT PURPOSES.

It is the sense of the Senate that the assumptions
underlying the budget resolution that the Congress should
consider legislation to exclude the receipts and
disbursements of the Airport and Airway Trust Fund from the
totals of the Budget of the United States Government.

SEC. 328. MILITARY RETIREMENT TRUST FUNDS NOT TAKEN INTO
ACCOUNT FOR DEFICIT PURPOSES.

It is the sense of the Senate that the assumptions
underlying this budget resolution assume that the Congress
should consider legislation to exclude the receipts and
disbursements of the retirement and disability trust funds
for members of the Armed Forces of the United States from the
totals of the Budget of the United States Government.

SEC. 329. CIVIL SERVICE RETIREMENT TRUST FUNDS NOT TAKEN INTO
ACCOUNT FOR DEFICIT PURPOSES.

It is the sense of the Senate that the assumptions
underlying this budget resolution assume that the Congress
should consider legislation to exclude the receipts and
disbursements of the retirement and disability trust funds
for civilian employees of the United States from the totals
of the Budget of the United States Government.

SEC. 330. UNEMPLOYMENT COMPENSATION TRUST FUND NOT TAKEN INTO
ACCOUNT FOR DEFICIT PURPOSES.

It is the sense of the Senate that the assumptions
underlying this budget resolution assume that the Congress
should consider legislation to exclude the receipts and
disbursements of the Federal Unemployment Compensation Trust
Fund from the totals of the Budget of the United States
Government.

SEC. 331. SENSE OF THE SENATE CONCERNING HIGHWAY TRUST FUND.

(a) Findings.--The Senate finds that--
(1) there is no direct linkage between the fuel taxes
deposited in the Highway Trust Fund and the transportation
spending from the Highway Trust Fund;
(2) the Federal budget process has severed this linkage by
dividing revenues and spending into separate budget
categories with--
(A) fuel taxes deposited in the Highway Trust Fund as
revenues; and

[[Page S5064]]

(B) most spending from the Highway Trust Fund in the
discretionary category;
(3) each budget category referred to in paragraph (2) has
its own rules and procedures; and
(4) under budget rules in effect prior to the date of
adoption of this resolution, an increase in fuel taxes
permits increased spending to be included in the budget, but
not for increased Highway Trust Fund spending.
(b) Sense of the Senate.--It is the sense of the Senate
that--
(1) in this session of Congress, Congress should, within a
unified budget, change the Federal budget process to
establish a linkage between the fuel taxes deposited in the
Highway Trust Fund, including any fuel tax increases that may
be enacted into law after the date of adoption of this
resolution, and the spending from the Highway Trust Fund; and
(2) changes to the budgetary treatment of the Highway Trust
Fund should not result in total program levels for highways
or mass transit that is inconsistent with those assumed under
the resolution.

SEC. 332. SENSE OF THE SENATE CONCERNING TAX INCENTIVES FOR
THE COST OF POST-SECONDARY EDUCATION.

It is the sense of the Senate that the provisions of this
resolution assume that any revenue reconciliation bill should
include tax incentives for the cost of post-secondary
education, including expenses of workforce education and
training at vocational schools and community colleges.

SEC. 333. SENSE OF THE SENATE ON ADDITIONAL TAX CUTS.

It is the sense of the Senate that nothing in this
resolution shall be construed as prohibiting Congress in
future years from providing additional tax relief if the cost
of such tax relief is offset by reductions in discretionary
or mandatory spending, or increases in revenue from
alternative sources.

SEC. 334. SENSE OF THE SENATE REGARDING TRUTH IN BUDGETING
AND SPECTRUM AUCTIONS.

(a) The Senate finds that--
(1) the electromagnetic spectrum is the property of the
American people and is managed on their behalf by the Federal
Government;
(2) the spectrum is a highly valuable and limited natural
resource;
(3) the auctioning of spectrum has raised billions of
dollars for the Treasury;
(4) the estimates made regarding the value of spectrum in
the past have proven unreliable, having previously
understated and now overstating its worth;
(5) because estimates of spectrum value depend on a number
of technological, economic, market forces, and other
variables that cannot be predicted or completely controlled,
it is not possible to reliably estimate the value of a given
segment of spectrum; therefore,
(b) It is the Sense of the Senate that as auctions occur as
assumed by this Resolution, the Congress shall take such
steps as necessary to reconcile the difference between actual
revenues raised and estimates made and shall reduce spending
accordingly if such auctions raise less revenue than
projected.

SEC. 335. HIGHWAY DEMONSTRATION PROJECTS.

(a) Findings.--The Senate finds that--
(1) 10 demonstration projects totaling $362,000,000 were
listed for special line-item funding in the Surface
Transportation Assistance Act of 1982;
(2) 152 demonstration projects totaling $1,400,000,000 were
named in the Surface Transportation and Uniform Relocation
Assistance Act of 1987;
(3) 64 percent of the funding for the 152 projects had not
been obligated after 5 years and State transportation
officials determined the projects added little, if any, to
meeting their transportation infrastructure priorities;
(4) 538 location specific projects totaling $6,230,000,000
were included in the Intermodal Surface Transportation
Efficiency Act of 1991;
(5) more than $3,300,000,000 of the funds authorized for
the 538 location-specific projects remained unobligated as of
January 31, 1997;
(6) the General Accounting Office determined that 31 States
plus the District of Columbia and Puerto Rico would have
received more funding if the Intermodal Surface
Transportation Efficiency Act location-specific project funds
were redistributed as Federal-aid highway program
apportionments;
(7) this type of project funding diverts Highway Trust Fund
money away from State transportation priorities established
under the formula allocation process and under the Intermodal
Surface Transportation and Efficiency Act of 1991;
(8) on June 20, 1995, by a vote of 75 yeas to 21 nays, the
Senate voted to prohibit the use of Federal Highway Trust
Fund money for future demonstration projects;
(9) the Intermodal Surface Transportation and Efficiency
Act of 1991 expires at the end of fiscal year 1997; and
(10) hundreds of funding requests for specific
transportation projects in Congressional Districts have been
submitted in the House of Representatives.
(b) Sense of the Senate.--It is the sense of the Senate
that--
(1) notwithstanding different views on existing Highway
Trust Fund distribution formulas, funding for demonstration
projects or other similarly titled projects diverts Highway
Trust Fund money away from State priorities and deprives
States of the ability to adequately address their
transportation needs;
(2) States are best able to determine the priorities for
allocating Federal-Aid-To-Highway monies within their
jurisdiction;
(3) Congress should not divert limited Highway Trust Fund
resources away from State transportation priorities by
authorizing new highway projects; and
(4) Congress should not authorize any new demonstration
projects or other similarly-titled projects.

SEC. 336. SENSE OF THE SENATE REGARDING THE USE OF BUDGET
SAVINGS.

(a) Findings.--The Senate makes the following findings:
(1) Poverty rates among the elderly are at the lowest level
since our Nation began to keep poverty statistics, due in
large part to the social security system and the medicare
program.
(2) Twenty-two percent of every dollar spent by the Federal
Government goes to the social security system.
(3) Eleven percent of every dollar spent by the Federal
Government goes to the medicare program.
(4) Currently, spending on the elderly accounts for \1/3\
of the Federal budget and more than \1/2\ of all domestic
spending other than interest on the national debt.
(5) Future generations of Americans must be guaranteed the
same value from the social security system as past covered
recipients.
(6) According to the 1997 report of the Managing Trustee
for the social security trust funds, the accumulated balance
in the Federal Old-Age and Survivors Insurance Trust Fund is
estimated to fall to zero by 2029, and the estimated payroll
tax at that time will be sufficient to cover only 75 percent
of the benefits owed to retirees at that time.
(7) The accumulated balance in the Federal Hospital
Insurance Trust Fund is estimated to fall to zero by 2001.
(8) While the Federal budget deficit has shrunk for the
fourth straight year to $67,000,000,000 in 1997, measures
need to be taken to ensure that that trend continues.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that budget
savings in the mandatory spending area should be used--
(1) to protect and enhance the retirement security of the
American people by ensuring the long-term future of the
social security system;
(2) to protect and enhance the health care security of
senior citizens by ensuring the long-term future of the
medicare program under title XVIII of the Social Security Act
(42 U.S.C. 1395 et seq.); and
(3) to restore and maintain Federal budget discipline to
ensure that the level of private investment necessary for
long-term economic growth and prosperity is available.

SEC. 337. SENSE OF THE SENATE REGARDING THE VALUE OF THE
SOCIAL SECURITY SYSTEM FOR FUTURE RETIREES.

(a) Findings.--The Senate makes the following findings:
(1) The social security system has allowed a generation of
Americans to retire with dignity. Today, 13 percent of the
population is 65 or older and by 2030, 20 percent of the
population will be 65 or older. More than \1/2\ of the
elderly do not receive private pensions and more than \1/3\
have no income from assets.
(2) For 60 percent of all senior citizens, social security
benefits provide almost 80 percent of their retirement
income. For 80 percent of all senior citizens, social
security benefits provide over 50 percent of their retirement
income.
(3) Poverty rates among the elderly are at the lowest level
since the United States began to keep poverty statistics, due
in large part to the social security system.
(4) Seventy-eight percent of Americans pay more in payroll
taxes than they do in income taxes.
(5) According to the 1997 report of the Managing Trustee
for the social security trust funds, the accumulated balance
in the Federal Old-Age and Survivors Insurance Trust Fund is
estimated to fall to zero by 2029, and the estimated payroll
tax at that time will be sufficient to cover only 75 percent
of the benefits owed to retirees at that time.
(6) The average American retiring in the year 2015 will pay
$250,000 in payroll taxes over the course of his or her
working career.
(7) Future generations of Americans must be guaranteed the
same value from the social security system as past covered
recipients.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions of this resolution assume that no change
in the social security system should be made that would
reduce the value of the social security system for future
generations of retirees.

SEC. 338. SENSE OF SENATE ON ECONOMIC GROWTH DIVIDEND
PROTECTION.

(a) Findings.--The Senate finds that with respect to the
revenue levels established under this resolution:
(1) According to the President's own economists, the tax
burden on Americans is the highest ever at 31.7 percent.
(2) According to the National Taxpayers Union, the average
American family now pays almost 40 percent of their income in
State, local, and Federal taxes.
(3) Between 1978 and 1985, while the top marginal rate on
capital gains was cut almost in half--from 35 to 20 percent--
total annual Federal receipts from the tax almost tripled
from $9,100,000,000 annually to $26,500,000,000 annually.
(4) Conversely, when Congress raised the rate in 1986,
revenues actually fell well below what was anticipated.
(5) Economists across-the-board predict that cutting the
capital gains rate will result in a revenue windfall for the
Treasury.
(6) While a USA Today poll from this March found 70 percent
of the American people believe that they need a tax cut,
under this resolution Federal spending will grow 17 percent
over five years while the net tax cuts are less than 1
percent of the total tax burden.
(b) Sense of Senate.--It is the sense of the Senate that
with respect to the revenue levels established under this
resolution, to the extent that actual revenues exceed the
revenues projected under this resolution due to higher than

[[Page S5065]]

anticipated economic growth, that revenue windfall should be
reserved exclusively for additional tax cuts and/or deficit
reduction.

SEC. 339. DEFICIT-NEUTRAL RESERVE FUND IN THE SENATE.

(a) In General.--In the Senate, revenue and spending
aggregates may be changed and allocations may be revised for
legislation that provides funding for early childhood
development programs for children ages zero to six provided
that the legislation which changes revenues or changes
spending will not increase the deficit for--
(1) fiscal year 1998;
(2) the period of fiscal years 1998 through 2002; or
(3) the period of fiscal years 2002 through 2007.
(b) Revised Allocations.--
(1) Adjustments for legislation.--Upon the consideration of
legislation pursuant to subsection (a), the Chairman of the
Committee on the Budget of the Senate may file with the
Senate appropriately revised allocations under sections
302(a) and 602(a) of the Congressional Budget Act of 1974 and
revised functional levels and aggregates to carry out this
section. These revised allocations, functional levels, and
aggregates shall be considered for the purposes of the
Congressional Budget Act of 1974 as allocations, functional
levels and aggregates contained in this resolution.
(2) Adjustments for amendments.--If the chairman of the
Committee on the Budget submits an adjustment under this
section for legislation in furtherance of the purpose
described in subsection (a) upon the offering of an amendment
to that legislation that would necessitate such a submission,
the chairman shall submit to the Senate appropriately revised
allocations under sections 302(a) and 602(a) of the
Congressional Budget Act of 1974 and revised functional
levels and aggregates to carry out this section. These
revised allocations, functional levels, and aggregates shall
be considered for the purposes of the Congressional Budget
Act of 1974 as allocations, functional levels and aggregates
contained in this resolution.
(c) Reporting Revised Allocations.--The appropriate
committee shall report appropriately revised allocations
pursuant to sections 302(b) and 602(b) of the Congressional
Budget Act of 1974 to carry out this section.

SEC. 340. SUPPORT FOR FEDERAL, STATE, AND LOCAL LAW
ENFORCEMENT OFFICERS.

(a) Findings.--The Senate makes the following findings:
(1) Our Federal, State, and local law enforcement officers
provide essential services that preserve and protect our
freedoms and security, and with the support of Federal
assistance, State and local law enforcement officers have
succeeded in reducing the national scourge of violent crime,
as illustrated by a murder rate in 1996 that is projected to
be the lowest since 1971 and a violent crime total in 1996
that is the lowest since 1990.
(2) Through a comprehensive effort to attack violence
against women mounted by State and local law enforcement, and
dedicated volunteers and professionals who provide victim
services, shelter, counseling, and advocacy to battered women
and their children, important strides have been made against
the national scourge of violence against women, illustrated
by the decline in the murder rate for wives, ex-wives, and
girlfriends at the hands of their ``intimates'' fell to a 19-
year low in 1995.
(3) Federal, State, and local law enforcement efforts need
continued financial commitment from the Federal Government
for funding and financial assistance to continue their
efforts to combat violent crime and violence against women.
(4) Federal, State and local law enforcement also face
other challenges which require continued financial commitment
from the Federal Government, including regaining control over
the Southwest Border, where drug trafficking and illegal
immigration continue to threaten public safety and menace
residents on the border and throughout the Nation.
(5) The Violent Crime Reduction Trust Fund established in
section 310001 the Violent Crime Control and Law Enforcement
Act of 1994 (42 U.S.C. 14211) fully funds the Violent Crime
Control and Law Enforcement Act of 1994, including the
Violence Against Women Act, without adding to the Federal
budget deficit.
(b) Sense of the Senate.--It is the sense of the Senate
that the provisions and the functional totals underlying this
resolution assume that--
(1) the Federal Government's commitment to fund Federal law
enforcement programs and programs to assist State and local
efforts to combat violent crime, including violence against
women, will be maintained; and
(2) funding for the Violent Crime Reduction Trust Fund will
continue in its current form at least through fiscal year
2002.

SEC. 341. SENSE OF CONGRESS REGARDING PARENTAL INVOLVEMENT IN
PREVENTION OF DRUG USE BY CHILDREN.

It is the sense of the Congress that the provisions of this
resolution assume that, from resources available in this
budget resolution, a portion should be set aside for a
national grassroots volunteer effort to encourage parental
education and involvement in youth drug prevention and to
create a drug-intolerant culture for our children.
Mr. DOMENICI. Mr. President, I move to reconsider the vote by which
the concurrent resolution was agreed to.
Mr. LAUTENBERG. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
[Applause.]
The PRESIDING OFFICER. Under the previous order, the Senate insists
on its amendment, requests a conference with the House and is
authorized to appoint conferees.
The majority leader.
Mr. LOTT. Mr. President, I have a couple unanimous consent requests
that I think Members will be very interested in. First, let me take a
moment to comment on the cooperation and the significance of that vote.
It truly was a bipartisan effort. It was cooperation between the
Congress and the President. I think we should be proud of it, and it is
an example of what I hope we can do more of in the future.
I thank the Democratic leader for his efforts, his willingness to be
on the floor and work with us on some of these votes. We had a couple
of bumpy spots along the way, but I think the result was a good one.
I particularly thank the chairman of the committee. I know he feels a
rush of emotion right now. He has been working on trying to get us to
this type of budget resolution for 25 years. I think he has done a
great job. I commend him and thank him for the great work he has done.
[Applause, Senators rising.]
Mr. LOTT. Also, the Senator from New Jersey stood right there with
him. They worked together. He kept his word, and we got a tremendous
result here of 78 to 22, overwhelming. Without that type of cooperation
across the aisle from the Budget Committee, it could not have been
achieved. So I thank one and all for what has been achieved today.
[Applause, Senators rising.]
Mr. DASCHLE. If the majority leader will yield for just a moment, I
know people are waiting for the vote on the judges, so we need to be
expeditious. I, too, commend the distinguished Budget Committee
chairman and the ranking member for the extraordinary demonstration of
leadership. This vote would not have been possible were it not for the
way they worked with the White House, with us, in coming to the vote we
have today.
This is a historic moment. We will balance the budget as a result of
this resolution. Democrats and Republicans alike can take credit and
can take a great deal of pride in what we have done today. So I commend
them and appreciate very much their leadership today.
Mr. DOMENICI. Mr. President, will the leader yield for 1 minute?
Mr. LOTT. Mr. President, I say to the chairman, I will yield to him.
He has earned the time.
Mr. DOMENICI. I don't want to start thanking people, because there
are so many who did so much. I do want to say, from my standpoint, that
my highest, highest thanks go to our majority leader. He has not been a
majority leader for a long time, and this is a very, very difficult
undertaking. There were a lot of potential pitfalls.
Frankly, I commend him for being a very, very courageous majority
leader. He has a lot of courage. When something has to be done and he
agrees to do it, it is like you have a great army with you; we just
move. If he wasn't in the lead, I was, and we took turns and we got
this done.
I also want to say that this is a bipartisan effort. I say to Senator
Daschle, thank you. When we had trouble, we would call on him.
Last but not least, I always knew Frank Lautenberg, but I didn't know
we were really friends. I think I can say we have a bond between us now
that came about because we worked on a very, very difficult set of
issues for a long time. I thank him and his staff for their
cooperation, and close by saying to all the Senators, thanks for the
way you conducted yourselves. This is a complicated, messy process, but
I think we did the Senate well, which I always want to do.
I will close by saying that the one staff person I must always
recognize, and I think the White House at one point suggested without
Bill Hoagland we couldn't put this together. I thank him publicly.
Frank, it is good to be your friend.
Mr. LAUTENBERG. If I may, Mr. President, I too, want to say that my
work with Pete Domenici was illuminating, a learning experience at
times. His smile sometimes was beguiling, but the steel nerves always
showed through. It was a good experience.

[[Page S5066]]

I noted with one of our colleagues over there, Senator Nickles--and I
am sure that he does not mind my quoting him here--he said that this
markup in the budget was the least acrimonious that he had seen in his
17 years on the Budget Committee. I, too, in the 14 years I have been
on the Budget Committee.
We had plenty of differences. Do not let anybody think it was smooth
going all the way. But there was a determination to get the job done.
It was largely Pete's leadership and our willingness to just put aside
some differences.
My leader, Tom Daschle, was always there to encourage me and the
team.
Senator Lott, too, you know how to push at times and how to pull at
other times. You still got us going in the same direction. I don't get
it. But it was a pleasure working with the majority leader.
My team, John Cahill, Bruce King, Sander Lurie, Marty Morris, Sue
Nelson, Mitch Warren, and the others whom I was fortunate enough to
inherit from the experienced days of Senator Exon and Senator Sasser,
Amy Abraham, Matt Greenwald, Phil Karsting, Jim Klumpner, Nell Mays,
and Jon Rosenwasser, everybody helped enormously. I want to say Bill
Hoagland and the majority leader's team were cooperative. They tried to
always make sure we understood exactly what was going to be in there.
There was no attempt to deceive or fool.
Thus, we have an agreement that we can all be proud of. The American
people should be proud of it. They saw us cooperating, as the majority
leader said. And here we saw a vote of 78 to 22. That is pretty darn
good.
Thank you very much. I yield the floor.
Mr. LOTT. I thank the Senator.
I do have a couple unanimous-consent requests to make. I think
Members will be very interested in this. Then we can go on with some
closing statements and some wrapup information.
We have some other matters that we are going to try to work through
in the afternoon. But if we can get these two agreements, then we could
announce there would be no further votes today. I think that would be
very important.

____________________