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.
“THE FEDERAL BUDGET” mentioning the U.S. Dept of Labor was published in the Senate section on pages S363-S365 on Feb. 2, 2004.
The publication is reproduced in full below:
THE FEDERAL BUDGET
Mr. VOINOVICH. Mr. President, I rise today to discuss an issue that I have been known to have some thoughts on from time to time and that is our Nation's fiscal situation and this body's approach to its budget responsibilities.
First, I would like to congratulate my colleagues for passing the Omnibus Appropriations bill. In this bill, we funded all of the President's priority items requested in the fiscal year 2004 budget and still restricted discretionary spending to $876 billion.
I recognize that many people were dissatisfied with this legislation. Some people believe Congress spends too little and last year my colleagues on the other side of the aisle offered amendments that would have added over $87 billion to total spending in fiscal year 2004. Other people believe Congress spends too much and asked President Bush to veto the Omnibus Appropriations bill because it contains too much
``pork''. It seems that neither extreme was pleased by the fiscal result, which may be the best indication we did the right thing. I will not claim the fiscal year omnibus is perfect. Nevertheless, this bill represents the best possible compromise between true fiscal discipline and Congress' desire to spend.
Unfortunately, this is our eighth consecutive year of compromising fiscal discipline and the American people are beginning to wonder when we will ever get our act together. The last time discretionary outlays authorized by Congress were lower than spending requested by the President was in 1996. According to the Cato Institute, real discretionary spending increases in fiscal years 2002, 2003 and 2004 are three of the 10 largest annual increases in the last 40 years. Also, the Congressional Budget Office reports that if current appropriations maintain the same rate of growth we have given them since 1999, we will increase discretionary spending by $2.7 trillion over 10 years and every penny of added spending will be reflected in the Federal deficit and debt.
Some people may take comfort in CBO's baseline projections that show the budget reaching surplus in 2013. Let me tell my colleagues these projections should not lull us into a false sense of complacency.
First, CBO itself explains the baseline projections must estimate the future paths of Federal revenues and spending under current laws and policies. The baseline is therefore not intended to be a prediction of future budgetary outcomes. Simply put, the CBO baseline projection assumes Congress will restrict the growth of spending to the rate of inflation, less than 3 percent a year and less than half its current rate of 7 percent. CBO also estimates that Congress will allow Federal revenues as a percentage of GDP to increase from 15.9 percent to 20.1 percent, almost a one-third increase.
Does anyone seriously believe Congress will restrict spending or increase taxes by the amounts required to meet the CBO projections? I wish I could say that I believed these projections but I outgrew fairy tales a long time ago.
Second, if we are honest with ourselves, many people just do not think deficits are important anymore. the commonly heard refrain from some of my colleagues is that Ronald Reagan proved deficits don't matter. Meanwhile, some people only seem to care about deficits when they get in the way of increased spending.
In 1995, the first year Republicans controlled Congress, spending grew by $25 billion. In 2004, with Republicans still in control of Congress, spending will increase by $224 billion. Essentially, the amount we increase spending each year has grown tenfold in just 9 years.
Well, I am here to tell you deficits are important. After 10 years as Mayor of Cleveland and 8 years as Governor of Ohio, I can tell you exactly why deficits are important. When a local or State government allows its finances to become dangerously unbalanced, creditors demand higher and higher premiums on municipal bonds until interest rates become unsustainable. Contractors withhold goods and services or demand strict payment terms as a condition of doing business. Taxes are often raised, which has a serious impact on businesses and families. Finally, government leaders are forced to make draconian cuts in public services.
Families and businesses often seek better opportunities elsewhere, because their local government leaders cannot solve the problems or provide government services such as school maintenance, fire and police protection and hospital services.
This downward spiral is not limited to state or local governments. Entire nations in South America, Eastern Europe, Southeastern Asia and elsewhere around the globe have followed this well worn path to fiscal demise. As much as we may like to think our Nation enjoys special protection from the laws of economics, the fact is that sooner or later our own fiscal irresponsibility and indebtedness will catch up to us. No government is immune to the consequences of deficit spending. Every government, State, local or national, that steadily increases spending with no means to pay the bill sooner or later pays a terrible penalty.
I know full well the penalty governments pay for fiscal foolishness. I took over as Mayor of Cleveland just after the city had gone into default and it took us 7 years to dig out of that hole. The, when I became Governor of Ohio, I inherited a $1.5 billion debt and had to immediately make over 700 emergency spending cuts by executive order and cut spending four more times during my administration.
I am here to tell my colleagues that for the United States, that time is close at hand. Our Federal budget is in dire condition. We face a sea of red ink as far as the eye can see. And perhaps the worst thing about it is that few people in this body appear to recognize how bad our predicament is.
Since I came to the Senate in 1999, this body has increased Federal spending an average of 7 percent per year. If we maintain this pace, Federal spending will double every 10 years. Just 3 years ago, we enjoyed a Federal surplus and we now will suffer from major deficits for at least the next 5 years.
From the time I first arrived in Washington, I have worked hard to return the Federal Government to a balanced budget. For a short time, after hand-to-hand combat, we met our goal and for 2 years, fiscal years 1999-2000, we balanced the budget without raiding the Social Security surplus. Unfortunately, our success in balancing the budget was short-lived. In the blink of an eye we returned to spending the Social Security surplus and running large budget deficits. Today, instead of reducing our $6 trillion national debt, we are expanding it.
In 2003, this past fiscal year, we suffered a budget deficit of $375 billion. This means that we spent the entire $161 billion Social Security surplus, and on top of that we had to issue $375 billion in new debt. And, if we are honest about the numbers, next year, and the next decade, look even worse.
Thankfully, in the omnibus bill, we avoided adopting many of the irresponsible spending amendments offered by some members of this body. So many of my friends on the other side of the aisle keep talking about how bad the deficits are, while at the same time, they keep supporting proposals to spend more money which would require borrowing even more next year. Since I joined the Senate in January 1999, there have been 190 attempts to waive the Budget Act, 67 last year alone. It defies logic for any group of Senators to complain about the deficit when they are making 67 attempts to waive the budget act and increase spending. I shutter to think what our deficit would look like if all 67 attempts had been successful. I find it troubling that many of my friends on the other side of the aisle cry crocodile tears about the size of the deficit while making 67 attempts to waive the budget act.
The proposals we did not pass total $87 billion for fiscal year 2004 alone and would have cost over $494 billion over the next 10 years, all of which would have added to the deficit. In other words, if these amendments had been approved, next year's deficit would be $564 billion instead of $477 billion. Even at today's very low interest rates of less than 5 percent, these amendments would have added $1.7 billion in additional annual interest payments every year. Apparently some people see very little difference between paying $200 billion a year in interest and $202 billion; but where does it end? How much of our children's future and even our own secure retirement can we mortgage away?
Nevertheless, there is an optimistic message in these numbers. There may have been 67 efforts to waive the Budget Act in 2003 but only three were successful. For all its well publicized problems, the budget process is working. The super majority points of order, established to exert at least a small level of fiscal discipline, effectively prevented 64 of 67 efforts to increase spending.
I believe it is time to make the Budget Act even more effective. Therefore I will be working to include new points of order in the upcoming fiscal year 2005 budget resolution. These points of order will help end one of the most dishonest budget practices in Washington: the use of Social Security Trust Fund revenues to finance general government expenses.
One of the biggest problems here in Washington when it comes to the budget is getting the facts straight. For example, it is commonly thought--and reported in the media--that we only suffered a $375 billion budget deficit last year. However, this figure ignores the fact that we borrowed and spent $161 billion from Social Security surplus on top of the $375 billion we had to borrow from the private markets.
We spend the Social Security surplus and leave the so-called Social Security trust fund full of government IOUs. Then, we pretend the money just dropped from the sky, and ignore the fact that we borrowed more money--not from the private markets, but from future Social Security beneficiaries. Like most Americans, I think it is wrong to use this money to fund the day-to-day operations of the government. This is no way to manage the finances of our Nation. We must adopt budget process mechanisms that encourage fiscal responsibility, highlight the future consequences of our current decisions and limit the potential for bookkeeping chicanery that would make an Enron accountant blush.
But I am not under any illusions that simply tinkering with the budget rules will restore fiscal discipline. Congress has made an art form out of skirting the budget rules it sets for itself, and I have no doubt that we could come up with a number of creative ways to avoid these rules as well.
Instead, we need to give the American people the full picture about the budget outlook so that the political pressure will be created for Congress to play by the rules and restore fiscal discipline. Last year I worked closely with Chairman Nickles and we were able to restore several important budget enforcement mechanisms such as: extension of supermajority enforcement of budget points of order; extension of discretionary spending limits in the Senate; extension of restriction on advance appropriations in the Senate; tighter restrictions on emergency spending legislation; and restoration of pay-as-you-go point of order in the Senate.
Also, as many of you know, last year I offered an amendment to the budget resolution requesting the CBO prepare a report describing the long term unfunded liabilities of the U.S. government. This amendment was approved by unanimous consent and CBO will shortly be providing us with this valuable information. I look forward to sharing this information with my colleagues. This year, I will go further and work to include a provision in the budget resolution directing CBO to include interest costs in its cost estimates for legislation. Many Members are surprised to learn that CBO does not factor in additional interest expense when it reports the cost of proposed legislation. It is as if we went to buy a house or car and completely ignored the financing costs and amortization schedule.
Today, our national debt stands at $6.8 trillion. If our new CBO figures come to fruition, we will add a cumulative deficit of $6.1 trillion from fiscal years 2004-2014, which would bring our debt up to a whopping $12.9 trillion. At this level, the interest payments on the national debt would exceed $600 billion, which is nearly twice as much as we currently spend on non-defense discretionary spending.
And who is going to end up paying for this debt? It won't be members of this body--no, instead it will land squarely in the lap of our children and grandchildren. I don't know any parents or grandparents who would think it was a good idea to run up huge personal debts that their children or grandchildren would have to pay at the time of their death, but that is exactly what we are doing with out Federal budget.
It is immoral to bequeath nearly $13 trillion of debt to our children and grandchildren. And most of the American people agree with me. I know this, because when people come into my office asking for money for a particular project, I always ask them the same question. That question is: is this particular priority worth putting your children and grandchildren further into debt? And it's remarkable, their attitudes immediately change, and many of them reconsider.
So the problem isn't that the American people aren't willing to sacrifice and make hard choices. The problem is that Congress hasn't had the guts to tell the truth about what we can and can't afford. We in Congress don't want to say no to anything. We want to have it all.
Over the past 10 years, Congress has increased spending at rates that would stagger the average family. Between 1995 and 2004 the growth in median income for wage earners in our Nation was 6 percent. There is not a single department in the entire Federal government that has been asked to restrict its growth in spending to less than 10 percent. The most frugal department, the Treasury, increased its spending by 10 percent or more than 1.5 times the level enjoyed by median income earners. The Department of Labor, guardian of the interests of the average workers, grew its spending by more than 99 percent or 16 times the increase earned by the workers it represents.
Those are the facts. Congress needs to wake up and smell the coffee. Unless we change course, start prioritizing, making hard choices, and stop spending like drunken sailors, we are going to saddle our children and grandchildren with a debt so large it boggles the mind.
I have no illusions about the enormity of the task at hand to restore fiscal discipline. It's a big job, but it is nothing short of a moral imperative. In order to avoid a total breakdown of the budget and appropriations process, President Bush will need to work very closely with Congress. Given the competing priorities in this body, it could be very difficult to increase Defense and Homeland Security by 9 percent while limiting the growth in domestic spending to only 1 percent. I am prayerful the Budget Committee will recognize the reality of these numbers and allocate sufficient funding to domestic budget function areas to gain the support of an overwhelming majority of Senators. To fail to do so would invite considerably more than 67 attempts to waive the budget act and if the budget is enacted with an arrow margin, I am not sure we will have the votes to defeat all of them.
And on top of all the pressure we face to increase spending, many of my colleagues would like to permanently extend the temporary tax reforms enacted last year, which would mean even less revenue than CBO has assumed in its most recent budget projections. So if we make these tax reforms permanent, we will need to either cut most of the spending in the discretionary portion of the budget or dig ourselves into an even deeper deficit hole.
Nor has anyone in the administration or in Congress seriously address the need to control mandatory spending. More than 55 percent of Federal spending consists of so called ``off budget'' mandatory entitlements. These mandatory programs may be off budget when we vote on appropriations bill but their costs weigh heavily on the budgets of future generations.
We have to recognize that everything we do this year will be measured against the backdrop of ever increasing deficits. It is time to take them seriously and begin to make the difficult choices needed to restore fiscal responsibility.
This will not be politically easy and I understand that. There is no shortage of important things the Federal Government could be doing across the Nation. And, I support many of those spending ideas.
But the simple, undeniable fact is that we can't have it all. We have to make hard choices.
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