Mr. Speaker, pursuant to House Resolution 665, I call up the bill (H.R. 2920) to reinstitute and update the Pay-As-You-Go requirement of budget neutrality on new tax and mandatory spending legislation, enforced by the threat of annual,…
Mr. Speaker, pursuant to House Resolution 665, I call up the bill (H.R. 2920) to reinstitute and update the Pay-As-You-Go requirement of budget neutrality on new tax and mandatory spending legislation, enforced by the threat of annual, automatic sequestration, and ask for its immediate consideration.
Mr. Speaker, at this point I would also like to ask unanimous consent that Members have 5 legislative days to revise and extend and insert material relevant to the consideration of H.R. 2920 in the record.
Mr. Speaker, I rise in strong support of the Statutory Pay-As-You-Go Act of 2009. To understand this bill, it's important and useful to understand its short history.
At the outset of the 1990s, Congress passed the Budget Enforcement Act to ensure that the Budget Summit Agreement would be carried out. Among these provisions was a rule called pay-as-you-go, PAYGO for short. At the time, critics distained and belittled our resort to budget process. They accused us of dodging the hard choices we had to make if we were going to wipe out the end of the deficit. But by the end of the 1990s, the budget was in surplus for the first time in 30 years, and it was clear that PAYGO had played an important part in our success.
In 2002, the Budget Enforcement Act was allowed to expire, and the President, President Bush, and the majority, the Republicans at that time, chose not to reinstate PAYGO. Without the process rule in place, the budget plunged from a surplus of $236 billion in the year 2000 to a deficit of $413 billion in the year 2004.
In April of 2005, in his congressional testimony, Alan Greenspan said, ``One of the real problems we had was allowing PAYGO to lapse in September of 2002, and were we to still be under a PAYGO regime, which I thought worked very well, I think we would have a lot fewer problems now.''
When Democrats took back the House, the reinstatement of PAYGO was at the top of our agenda. To expedite its passage, PAYGO was made a rule of the House the day we convened. Without support of the Bush administration, there was no prospect of getting statutory PAYGO enacted in law, but now with the support of the Obama administration, indeed, the underlying legislation we are pushing and advancing today was originally sent to us for filing by request from the President, Mr. Obama.
With the support of the Obama administration, we're in a position now to take a longer stride towards budget discipline by enacting statutory PAYGO into law. The Obama administration has inherited a colossal deficit swollen to accommodate massive recovery measures. As these measures pull us up out of the slump, we must focus attention on our longer-term fiscal fate.
By themselves, budget process rules cannot convert deficits into surpluses, but as in the 1990s, they can play a vital role. Statutory PAYGO works by reining in both new entitlement spending and new tax cuts. Both tend to be long lasting. They are easy to pass and hard to repeal. And by insisting in deficit neutrality for these new policies, PAYGO buffers the bottom line, holds it constant. Its terms are complex, but at its core, it's a commonsense rule that everybody can understand: When you are in deficit, don't make it worse. When you want to spend a dollar, save a dollar. Everybody can understand the commonsense logic of this bill.
I would add that PAYGO has not only been a commonsense idea that found its way into the rules of the House and the statute books, but it has traditionally received bipartisan report. Originally, it was enacted in 1990 under a Republican President and Democratic Congress. In 1997, it was extended under a Democratic President and a Republican Congress.
This is not a panacea--I wouldn't hold it out as that--but it is a significant step in the right direction. It was proven to work in the 1990s, and it needs to be reinstated for that purpose now.
I reserve the balance of my time.
Mr. Speaker, I yield 2 minutes to the gentleman from Texas, a member of the committee, Mr. Doggett.
Mr. Speaker, I yield 4 minutes to the gentleman from California, who claims paternity of this bill, having first introduced the legislation calling for the PAYGO rule, Mr. Miller.
(Mr. GEORGE MILLER of California asked and was given permission to revise and extend his remarks.)
Mr. Speaker, I yield 2 minutes to the gentleman from Texas (Mr. Edwards) who has been a prime mover behind this bill and is the originator of the idea that it should not be a 5 or 10-year bill, but a permanent law.
Mr. Speaker, I yield 2 minutes to the gentleman from Maryland (Mr. Van Hollen).
Let me simply respond by saying, I'm glad to bring this to the floor. I voted for it in the past, saw it work, and I think it's going to work again. As I said, it's not a panacea, but it's a useful device to have in our arsenal of weapons to deal with the recession we're in.
By the way, the recession that we're in, which has caused us to suffer a huge swelling in the deficit, started in December of 2007, on the Bush watch. Wall Street fell apart in September of 2008. The TARP program was initiated in response to that. That too happened during the Bush watch. We're in the backwash of many fiscal policies and economic policies which happened on their watch, and we're now suffering the consequences of them.
I now yield 3 minutes to the gentleman from Vermont (Mr. Welch).
Mr. Speaker, I yield 2 minutes to the gentleman from New York (Mr. Bishop).
Mr. Speaker, I yield 3 minutes to the gentleman from Florida (Mr. Boyd).
I yield the gentleman 30 additional seconds.
Mr. Speaker, I yield 2 minutes to the gentleman from Kansas (Mr. Moore).
Mr. Speaker, I yield 2 minutes to the gentlewoman from Pennsylvania (Ms. Schwartz), the vice chairman of our committee.
We have one more speaker, and then I will close.
I yield 2 minutes to the gentleman from New Jersey (Mr. Andrews).
(Mr. ANDREWS asked and was given permission to revise and extend his remarks.)
Let me respond to some arguments that have been made and not responded to during the course of this argument.
First of all, the sequestration base, the programs which are subject to across-the-board cuts or abatement in the event that there is a deficit on the scorecard, why is that a narrow selection of programs? Because it's a cross section of programs purposely intended to reach a number of different constituent groups so that we will not use sequestration. Neither the President nor the Congress would want to use a meat cleaver like that.
We've said, knowing that it could happen if we defaulted in doing anything else, young people, old people, farmers, miners, a huge cross section of our constituencies are represented in that sequestration base to make it certain, clear that we would never resort to that particular base for making across-the-board cuts to put PAYGO back in balance.
Secondly, there's been repeated talk about, You passed PAYGO in the last Congress and look what happened. The truth of the matter is our Republican colleagues have never wanted to vote for PAYGO because it was always double-edged the way we proposed it. Double-edged meant yes, it would apply to mandatory spending increases, but it would also apply to tax cuts, because both have an adverse impact on the deficit bottom line.
They would never vote for the second edge, the double-edged sword, and consequently they have to come up with another explanation as to why they do not support it.
So they fall back on the economy itself. Look what happened to the economy after the adoption of the PAYGO rule in the 110th Congress. But, come on. This is a case where we have a coincidence, maybe, but not a correlation. The PAYGO rule had nothing to do with what happened to the economy. The Bush administration's economic and fiscal policies had a lot to do with what happened to the economy.
The fact that the Bush administration inherited a projected surplus of $565.6 trillion and turned it into a projected deficit of $3 trillion had an impact on the economy. The addition of $5 trillion to $6 trillion to our national debt had an impact on our economy. And don't forget the recession officially started during the Bush administration, December 2007. That's when it started.
And when it really got bad, when Wall Street nearly went under in September and October of 2008, that, too, was the Bush administration. And we voted up the TARP, and that's one of the reasons--the Troubled Asset Relief Program, a $700 billion program. When we voted that up, the Bush administration was still in office.
So there's the answer to the charge that somehow or another the PAYGO rule didn't do anything to affect the economic situation we find ourselves in.
The reason we are seeing the largest deficits in the history is we're in the longest recession since the Great Depression. It's had a profound impact on us. The incubation of those conditions occurred during the Bush administration.
So, Mr. Speaker, the facts stand. All during the 1990s, when we had the budget process rules in place, they contributed mightily. We had a good budget and the convergence of a good economy, and we put the budget back in balance by the year 1998.
The facts speak for themselves, and facts are stubborn things. The budget process rules worked before. They will work again, if we vote for the statutory PAYGO.
Mr. Speaker, I rise in opposition to the amendment and yield myself 3 minutes.
Mr. Speaker, so that everyone will understand, what the gentleman is proposing is that we rewrite the budget resolution, which we wrote and passed in both the House and Senate months ago, to go back to square one and basically begin all over again because we will have to change 302(a) and all the work we've done to get the appropriation bills passed by the end of July. We would have to go back and take at least $48 billion out of all those bills to comply with the numbers that Mr. Ryan proposes in his alternative budget resolution today.
I will have to say that when I told Mr. Ryan we were not going to have a hearing, that we were not going to have a markup, we were going to bring this matter straight to the floor, I also told him out of a sense of fairness that he could have a substitute, that I would support a substitute. He deserves one. I had no idea that he would offer a brand-new budget resolution as a substitute. I thought it would be a substitute, maybe a cap on discretionary spending. So this came as a surprise. There is a cap on discretionary spending here; but as I read it, there is no cap, there is no PAYGO provision. He has left it out of there completely. That's the way we read over here. I can't find anything in there.
In addition, I thought ours was pretty dense; and then I read some of your draftsmanship, if I can share with everyone. Try this on: The percentage required to produce a spending reduction, as ordered by a spending reduction order, shall be calculated by OMB by adding all budgetary resources of the government, and reducing that amount by an amount sufficient to reduce the total amount of outlays of the government to equal, or lower, a level of outlays than the amount set forth in the guideline period.
If we are dense, this is turgid, I am telling you. I'm not quite sure what this says, except that it does propose a new budget resolution. It would become a statutory budget resolution if we passed it as part of this particular bill because this is----
I will.
It is similar to the PAYGO rule here.
You set levels for all of those things and then also provide--I believe if they turn out to be wrong, if we had a downturn in the economy and wanted to change those numbers, you would have to have a two-thirds vote in each House in order to do that.
That loads some cumbersome conditions on the House or the Senate if we find ourselves faced with economic reversal.
Mr. Speaker, I yield 3 minutes to the gentleman from Oregon (Mr. Schrader).
Mr. Speaker, I yield 3 minutes to the gentleman from Indiana, Mr. Baron Hill.
Mr. Speaker, it is my honor to yield to the Speaker of the House, the gentlewoman from California, Madam Speaker (Ms. Pelosi).
Mr. Speaker, I yield 3 minutes to the gentleman from Rhode Island (Mr. Langevin).
Mr. Speaker, I yield 3 minutes to the gentlelady from Massachusetts (Ms. Tsongas).
Mr. Speaker, I yield 3 minutes to the gentleman from Wisconsin (Mr. Kind).
Mr. Speaker, I yield 2 minutes to the gentleman from North Dakota (Mr. Pomeroy).
Mr. Speaker, I yield 2 minutes to the gentleman from Connecticut (Mr. Himes).
I plan to use the time left, and Mr. Hoyer will speak as well and share part of the time.
If I may inquire of the Chair, how much time is remaining?
I yield myself 6 minutes. Mr. Speaker, let me make everyone aware of what is at stake here. What the minority has proposed is to take this resolution, this bill, and add to it a budget resolution for 2010 and years thereafter, way outside of the established procedure of the House to do at this point in time. We have strived mightily to finish up all of the appropriations bills by the time we adjourn for the August vacation. And it looks as though we are going to be successful in our pursuit. And I think we all deserve credit for having accomplished that.
Were we to adopt this resolution, we would have a completely different set of numbers. At least $48 billion would have to be reallocated within section 302(a), because there is a cut immediately in discretionary spending. If you hold constant and inflate the amount of money provided for overseas contingency operations, military operations, the amount of money that would have to be extracted from other programs that has basically already been distributed, already been allocated, already been cut, would be around $70 billion.
That is a lot of work that would have to be done again. We would have to basically go back to square one and start over again. So that is the first problem we have with this bill. And that basically is enough reason for anyone who is concerned with finishing timely business here in the House for the summer before adjourning, that is enough to vote against the substitute that the gentleman is offering.
But if that's not enough for you, read onward. Get a copy of this resolution and read the language to see what is being proposed here, because what the gentleman proposes to do is to fix spending, total spending, discretionary spending and deficit as a percentage of gross domestic product for a period of 5 years, after which it will be fixed at the levels it reaches at the end of the 5-year period of time. This would have profound consequences for the budget. We have never budgeted like that, not over that period of time.
Furthermore, the gentleman says we are going to put these in place-- this is a resolution that he understandably, under the circumstances, has cobbled together in a few days--he is going to impose something that would be binding for 5 years. And if there were a reversal in the economy for the worse, and we needed to engage in countercyclical economic intervention, this would be a huge stumbling block, because two-thirds of the House would have to agree to any deviation from the spending limits that this resolution or this substitute would impose, two-thirds of the House. A determined minority of one-third could block any kind of salutary action we wanted to take.
That's not good policy. It's not good policymaking. We have never done it before. It would be a mistake to do it now. So for those reasons, I would say to all of my colleagues on both sides of the aisle, read the resolution, read the substitute, and I think you will see this is something we do not want to do at this particular point in time. We don't want to go back to square one and do the appropriations bills all over again. We don't want to cast a rigid cast around the budget resolution so that if we do have a downturn in the economy the budget resolution itself would actually be, the budget would actually be procyclical. We try to have countercyclical economic policies built into our budget. This budget resolution, this budget substitute would actually be procyclical. It would worsen the downturn in the economy if it were to take that turn at this point in time.
So for all of these reasons, I would urge Members on both sides of the aisle, mine particularly, but the other side as well, to look carefully before you cast this vote and vote ``no'' on the substitute that has been offered by Mr. Ryan.
I reserve the balance of my time.
Mr. Speaker, one question to the distinguished ranking member. Where were you when we had, first, Iraq and then Afghanistan, and it came to paying for those endeavors which account for by far the biggest growth in spending in the discretionary accounts. There were no spending caps at that particular point in time.
I yield for a brief response.
I now yield 1 minute to the distinguished majority leader, the gentleman from Maryland (Mr. Hoyer).
I would say once again, Mr. Speaker, using the balance of my time, that every Member in voting on this substitute should understand its consequences. Its consequences would be to undo completely the bill that we're trying to move now that a lot of us believe is a useful measure, useful tool in disciplining our budget. It will be a shame to see us come this far only to falter on a resolution like the substitute offered by the gentleman from Wisconsin. It will not be consistent at all.
And it's interesting to note that while he makes elaborate provisions for limiting spending and limiting deficits, there's no provision whatsoever made for incorporation of the PAYGO rule, which has proved itself in the past to be successful.
So I say vote for the resolution, but vote first against the substitute that is being offered by the gentleman from Wisconsin because, if it is adopted, it will not adapt to, will not fit into the base bill before the House. Instead, it would undo its effectiveness altogether.
I yield back the balance of my time.
Announcement by the Speaker Pro Tempore
Mr. Speaker, I demand a recorded vote.
Mr. Speaker, I rise in opposition to the motion to recommit.
This resolution is too clever by half. Our colleagues across the aisle have not had some sudden epiphany and decided this bill, after all, was something they could embrace. This is an effort not to push the bill across the finish line, but to kill it before it finally gets passed here from the House. We have worked for months to get statutory PAYGO to the point where we can now put it over the top and put it in the statute books of the United States of America. If we vote for the resolution, if we vote for the motion to recommit, we will put that at jeopardy because this is a procedural device to defeat a bill that they cannot defeat on the substance of the merits of the bill itself. We won the argument on the substantive merits. They want to take it back now by a procedural device. Their aim is to insert in this bill numbers that were inserted and used in a Blue Dog publication that was issued last January, 7 or 8 months ago. The numbers have changed. They're dramatically different from what they are in the conference report, the concurrent resolution we finally adopted.
As I said, we've been through an arduous budget process to determine these details. If we now begin undoing those details, everything will come unraveled, including the bill before us. So I would urge every Member on this side to stick together. We're on the verge of passing it.
I yield to the gentleman from Indiana (Mr. Hill), who is one of the authors of the bill.
Mr. Speaker, I yield the balance of my time to the distinguished majority leader, the gentleman from Maryland (Mr. Hoyer).
I yield back the balance of my time.
Mr. Speaker, I demand a recorded vote.