The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS” mentioning the Federal Reserve System was published in the Senate section on pages S14132-S14134 on Sept. 22, 1995.
The publication is reproduced in full below:
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
By Mr. MACK (for himself, Mr. Dole, Mr. Lott, Mr. D'Amato, Mr.
Kyl, Mr. Shelby, Mr. Bennett, Mr. Gramm, Mr. Nickles, Mr. Roth,
Mr. Frist, Mr. Craig, Mr. Santorum, Mr. Bond, Mr. Faircloth, and Mr. Cochran):
S. 1266. A bill to require the Board of Governors of the Federal Reserve System to focus on price stability in establishing monetary policy to ensure the stable, long-term purchasing power of the currency, to repeal the Full Employment and Balanced Growth Act of 1978, and for other purposes; to the Committee on Banking, Housing, and Urban Affairs.
THE ECONOMIC GROWTH AND PRICE STABILITY ACT OF 1995
Mr. MACK. Mr. President, today I am introducing the Economic Growth and Price Stability Act of 1995. This legislation aims to accomplish two major goals. First, it focuses the Federal Reserve on achieving price stability. Second, it repeals the Full Employment and Balanced Growth Act of 1978--the Humphrey-Hawkins Act--which codified the Keynesian principles that advocate government fine-tuning of the economy.
Based on the fundamentally flawed premise that government can manage the economy, the Humphrey-Hawkins Act set targets for the economy to reach an unemployment rate of 3 percent for individuals over 20 and 4 percent for individuals over 16 and an inflation rate of 3 percent eventually moving to zero. Almost 20 years later, we know that this law has never achieved any of its intentions. This law proves that government cannot legislate prosperity--the reality is that individuals create jobs and free markets lead to prosperity.
By codifying unrealistic goals, the Humphrey-Hawkins Act gives the Fed an unachievable mission to artificially boost growth and employment while keeping inflation and interest rates low. This promotes fine-
tuning of monetary policy by the Fed in response to current economic trends. While this may lead to short-term economic boosts, over the long term such intervention by the Fed leads to higher inflation, higher interest rates, and more frequent recessions. The Economic Growth and Price Stability Act corrects this problem by focusing the Fed on the only goal it can effectively achieve: price stability. Focusing the Fed on price stability will lead to a sounder dollar, more stable financial markets, increased employment, and greater long-term economic growth.
The Economic Growth and Price Stability Act gives the Fed the responsibilities of defining price stability, charting its own course toward achieving and maintaining it, and setting its own timeframe for accomplishing the price stability goal. By allowing the Fed to create its own timetable, we can rest assured that transitional effects on employment and output will not occur.
Under my legislation, the Fed will still be required to report to Congress on a semiannual basis, but it will additionally be required to explain, in verbal and numerical terms, its definition of and its methods for attaining price stability. By not mandating inflation targets, this legislation places the burden on the Fed to appropriately define price stability. As we all know, the market is a harsh task master, and I believe it will be the best judge of the Fed's progress.
The Fed will have a strong incentive to make correct decisions about its definition of price stability and its method for achieving it, because the markets will be quick to express their views. The Fed will pursue price stability honestly and openly, because if it does not, long term interest rates will rise.
Instead of countercyclical, command and control, government interventionist economics, the Economic Growth and Price Stability Act sets in place a free market paradigm. Under the Economic Growth and Price Stability Act the principal economic responsibilities of government are to establish and ensure an environment conducive to long-term economic growth and increases in living standards by maintaining free markets, low taxes, respect for private property, and the stable long-term purchasing power of the U.S. currency.
If the elections in November 1994 taught us anything, they taught us that the American people want less government, not more. The Economic Growth and Price Stability Act recognizes that the American people know what is best for them and directly responds to their demands. I hope you will join me in this vital effort to free our economy from government mishandling.
Mr. D'AMATO. Mr. President, I am proud to cosponsor with Senator Mack, the Economic Growth and Stability Act. As chairman of the Joint Economic Committee and a member of the Banking Committee, Senator Mack has studied economic issues studiously. I commend him for this initiative.
This bill would repeal the Humphrey-Hawkins Act, which sets the current guidelines for the Federal Reserve's conduct of monetary policy. The multiple goals of Humphrey-Hawkins, however laudable, are conflicting and unattainable. In the long term the Fed can only address inflation. Unemployment and other such matters are the responsibility of the administration and Congress--which we control through our spending and tax decisions. Under this bill, we could no longer lay the blame of failed fiscal policy at the foot of the Federal Reserve.
Senator Mack's bill would recognize that the appropriate goal for the Federal Reserve is maintaining price stability in the long term. The Economic Growth and Price Stability Act recognizes that a key factor in encouraging growth is a stable environment in which to make decisions about the future. In an atmosphere of assured price stability, American families and corporations would be better able to budget and plan for the future. Assuring this steady level of capital investment and growth will create the jobs necessary to keep Americans' working.
The policies and school of thought behind this legislation are sound. Federal Reserve Board Chairman Alan Greenspan has testified that ``a key ingredient in achieving the highest possible levels of productivity, real income, and living standards is the achievement of price stability.'' The Economic Growth and Stability Act is a critical step in this direction.
Working together, the Federal Reserve can tackle inflation while the Congress, with the right fiscal policy, can stimulate long-term growth. We must return to a period of strong growth for our country to prosper and remain globally competitive. We owe it to ourselves and our children.
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By Mr. THOMAS (for himself, Mr. Grassley, Mr. Jeffords, Mr.
Frist, Mr. Simpson, and Mr. Burns):
S. 1268. A bill to provide assistance for the establishment of community rural health networks in chronically undeserved areas, to provide incentives for providers of health care services to furnish services in such areas, and for other purposes; to the Committee on Finance.
the rural health development act
Mr. THOMAS. Mr. President, I rise today to introduce the Rural Health Development Act, an act that I have worked on for some time, to help rural communities design a delivery system that fits their unique health care needs. It has been a project, in fact, that I have worked on since the day I arrived in the House, more than 5 years ago. This issue and these items continue to be a top priority for me here in the Senate. I am pleased that my colleagues, Senators Grassley, Jeffords, Simpson, Burns and Frist, have joined me in this effort. They, too, have worked feverishly on behalf of the rural communities in their States.
Rural health care, Mr. President, as you know from your State, is at a crossroads. My bill provides for an infrastructure needed to create a system of quality health care for rural families. There are a number of problems that are unique to rural areas--the lack of physicians, nurses, health care extenders, nurse practitioners, and physician assistants. We are troubled by the closure of small hospitals where the utilization has been relatively low, and leaves a community without some kind of emergency medical service.
Inadequate and unequal Medicare reimbursement is a problem today. So we have what we think is a solution. It helps communities develop their own health care delivery system. It assists in recruiting and retaining physicians. It improves educational opportunities for nurses, physicians, physician extenders, and other kinds of health professionals. It allows hospitals to downsize without losing their emergency room capacity. In short, it is a long-term solution tailored to the needs of rural areas.
Specifically, it provides technical assistance. Small grant funds are provided to help communities to design their own network, not one designed by outside consultants who are only familiar with the characteristics of larger places. Second, these funds can be used for two purposes--to build telemedicine systems to assist rural areas, and coordinate arrangements between primary care clinics, emergency medical centers, and tertiary care facilities.
Finally, the result to rural individuals, families and employers is the ability to take advantage of cost savings that occur elsewhere, which has not been able to occur in rural America.
We equalize the Medicare reimbursement rates. Rural counties receive significantly less reimbursement from Medicare managed care programs. For example, Fall River County in South Dakota, receives $177 per month, per beneficiary versus $678 for Bronx County in New York--a 367 percent difference.
My bill reduces this variation and reimburses rural providers relative to their metropolitan counterparts. The result, of course, is that Medicare beneficiaries in rural areas will have the opportunity to participate in managed care plans.
Third, it improves the educational opportunities for nurses. Nurses are a critical component to rural health care. My bill guarantees that 20 percent of all scholarships offered through the National Health Service Corps go to nurses in rural areas. Since 1972, over 70 health care providers have served in Wyoming through the services of the National Health Service Corps Program. So we put greater emphasis there.
Regarding recruiting and retaining physicians, Medicare currently provides a 10 percent bonus in rural areas. Ten percent is not much of an incentive. So it is increased to 20. To compensate for the increase, the bonus is restricted to primary care physicians in rural areas.
In addition, the bill guarantees 24-hour emergency care. Medicare currently restricts States from establishing limited-service hospitals. As a result, many facilities either have to operate as full-service hospitals, with very low utilization, or close. We are suggesting they be recategorized as a rural emergency access care hospital so that indeed they can be reimbursed from HCFA for these emergency services.
In conclusion, Mr. President, as we search for solutions to deliver health care throughout the country, the Rural Development Health Care Act is one proposal that should be added to the list. Many of the provisions have received a favorable response--so much so that they are likely to be folded into the reconciliation package.
More important, the Rural Development Health Care Act provides the answer to rural communities that are looking to keep up with the rapidly changing health care environment.
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