Mr. President, I wish to thank my colleague, the Senator from Wyoming, chairman of the Budget Committee, Mr. Enzi, for allowing me, as the vice chairman of the Joint Economic Committee, some time on the Senate floor to discuss the budget.…
Mr. President, I wish to thank my colleague, the Senator from Wyoming, chairman of the Budget Committee, Mr. Enzi, for allowing me, as the vice chairman of the Joint Economic Committee, some time on the Senate floor to discuss the budget.
Our budget process is important, and it has long been in a period of neglect. It needs reform. That is what I am here to talk about today. There are so many areas that are affected by our budgeting process or, at least, that should be. In fact, it is difficult to conceive of any aspect of the Federal Government that couldn't be or shouldn't be addressed through the budgeting process.
When we look at the budget process, it is important for us to focus, to one degree or another, on the Budget Act of 1974. This is an old law. Forty-three years in statute has not exactly improved it. It hasn't matured into something better. In other words, rather than a piece of art that has appreciated in value over time, this is something more akin to the 8-track tape player that you might have purchased in 1974 to go inside your Ford Pinto, which would explode upon impact. This is something that didn't really improve in the 43 years since it was passed, especially not the way we have followed it or, better said, the way we have utterly failed to follow it.
One of the best ways to describe the budgeting process, prescribed by the Budget Act of 1974, is that it is nonbinding. It is less legislation than it is legislative fiction. It is aspirational in the sense that it aims for what could be and what should be, except no one actually aspires to it. In Congress, we don't get to the aspiration, basically, ever. It is reminiscent almost of the immortal words of St. Augustine. When he was undergoing his transition to Christianity, he famously said: ``Lord, grant me chastity . . . but not yet''--always wanting to restrain oneself later and not now, even though the need for restraint, the need for reform is present now, is calling out for reform right now. That is why it is important to remember that what comes next is
important, and next is now. We are discussing the budget this week, and it is important that we focus on these issues right now.
We do have a system that has to be kept carefully in balance. That balance depends on Congress keeping the national interest front and center. It depends on Congress being willing to restrain itself and follow the dictates of our constitutional structure. We have failed on these scores.
Congress collectively, actively, almost defiantly avoids the very type of accountability built into our constitutional structure--the type of accountability called for by article I of the Constitution. Article I, the very first clause of the first section of the first article of the Constitution, makes clear that if you are going to make policy within the Federal Government, if you are going to establish norms that will be enforceable as generally applicable laws within our Federal Government, you have to go through Congress.
``All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.'' Article I, section 1 tells us that.
Article I, section 7 tells us that in order to make a law in our Federal system, you first have to pass something through the House of Representatives and the Senate, and then you have to submit it to the White House. You cannot make law without going through that process. That process is also worked in for a budgeting process.
The way the Budget Act of 1974 is supposed to work, the way our budget process is supposed to operate is that we will pass a series of laws appropriating money in various aspects of the Federal Government. We have a budget that gets passed first, which is an aspirational statement not submitted to the President. It is a resolution passed jointly by both Houses of Congress that sets budgeting priorities. Then, following from those priorities, there are supposed to be 13 separate appropriations bills that spend money, that allocate the scarce resources of the Federal Government, understanding that they are finite to each of the major areas of government spending.
There will be one bill, for example, that funds National Defense. There is another bill that will fund our Justice Department or Federal court system. There is another bill that will fund, for example, our national parks, and so on and so forth. When you follow that formula, you avoid the kind of circumstance in which we push all spending decisions into one legislative package, setting up a potential for disaster.
A common analogy that I sometimes use to describe this is, imagine if you live in an outlying area, in an area where there is only one grocery store for 100, maybe 200 miles around. Upon moving there, suppose, on your way home from work, you receive a phone call from your significant other telling you to stop by the store: Don't come home without bread, milk, and eggs. You don't need everything else. Just get bread, milk, and eggs.
You go to the grocery store. You get your shopping cart, and you put in your bread, milk, and eggs. You get to the checkout counter. You put out your bread, milk, and eggs.
The cashier says to you: Excuse me, there is a problem. You can't buy just bread, milk, and eggs. This is a special kind of store where you can't buy bread, milk, and eggs unless you also buy a bucket of nails, one-half ton of iron ore, a Barry Manilow album, and a book about cowboy poetry. In fact, for that matter, this is the kind of store where you have to buy one of every item in order to buy anything else. That is kind of what it is like every time we pass a spending bill lately because, even though the Budget Act of 1974 contemplates 12 or 13 separate appropriations bills, each addressing one discreet aspect of the Federal Government's spending, we end up, more often than not-- in fact, basically every single time for the last 6 of \1/2\ years I have been serving here, and even longer than that, we end up passing either a continuing resolution, which basically is a reset button saying that we will continue to spend next year at the same rate we have been spending this year, subject to these minor exceptions or, alternatively, we might pass an omnibus spending bill, which can be 1,000, maybe 2,000 pages long, sometimes longer, and identify all the areas in which we will be spending but put into one unified bill.
The problem with these bills, the way we have tended to do continuing resolutions and omnibus spending bills, is that we tend to consider and pass them under a compacted time agreement in the final hours or minutes before a cliff. By ``cliff,'' I mean an arbitrary deadline, after which a spending measure already in place will expire. So if there is a spending bill that expires on September 30 of a particular year, it is not uncommon for us to address a spending bill on September 30, sometimes late in the day on September 30 or in the days leading up to it.
It is not uncommon for Members of Congress to be told at that moment: You have two choices. You can either pass this as is and have everything funded more or less as it has been or you can shut down the government.
Nobody really wants to cause a government shutdown. Certainly, nobody wants to be accused of shutting down the government.
Most Members tend to vote for it, and then the American people continue to get what they have been getting. They continue to operate a Federal Government that spends about $4 trillion a year, with little or no control, even by the people's own elected Representatives in Congress, whose job it is to do these things over their own government. This is wrong.
We shouldn't be governing this way. Yet there is a touch of irony in this in that we govern this way, I think, at least in part, because of a fear of public outcry against the process or criticism about the process in which we might engage. Yet, as we undertake this process, which undercuts that process altogether and sidesteps it, as we have avoided that studiously in order to avoid criticism, we have seen Congress's approval rating plummet. In fact, if you look at most opinion polls these days, it puts our approval rating as an institution right around 10 percent. The last time I checked, in the United States of America, that makes us less popular than Fidel Castro. It makes us only slightly more popular than the influenza virus, which is rapidly gaining on us.
If what we are wanting to do is avoid criticism, then the last thing we ought to do is continue to do what we have been doing, which is to consolidate all spending decisions into one legislative package to be addressed at the end of the fiscal year, telling Members they have to either vote for it or be blamed for a government shutdown. That is wrong. That shuts out the American people, and it makes their government unaccountable to them.
In the process, we avoid reforming a lot of programs that need reforming. Among other things, we avoid reforming entitlement spending. It is important when we think about entitlement spending and how it needs to be reformed to remember the immortal words of President John F. Kennedy, who said that ``to govern is to choose.'' But today, to budget is not to choose or to choose in advance not to choose, to avoid choosing altogether.
We are $20 trillion in debt, and we choose to ignore that. Twenty trillion dollars is an enormous amount of money, as is the interest we pay on that sum every single year, which is about $250 billion a year-- an enormous sum of money in and of itself. But that isn't the scary part. The scary part is that $250 billion, which is what we spend every year on interest on our national debt, is roughly the same interest payment we had about 20 years ago. I believe our national debt was one- sixth or one-seventh of its current size. The only reason it is even that low is because our Treasury yield rates--the interest rate at which the U.S. Government pays its creditors--is at an all-time historical low.
Laws of mathematics are such that what goes down must inevitably come back up. As soon as it does come back up, even if it comes up only to its historical average and doesn't rebound above that average, in a short period of time, within a few years after that, we will find ourselves going from about $250 billion a year in interest on debt to about $1 trillion a year in interest on debt, leaving ourselves with the uncomfortable, darned-near impossible
prospect of having to cover a $750 billion shortfall--this on top of our existing sprawling national deficit--without any clear means of doing so.
Congress, in many cases, fears reform, but reform remains necessary to make programs structurally reliable and fiscally sustainable. In other words, we are fearing the wrong thing. A lot of people in my home State of Utah fear snakes, understandably. We have rattlesnakes in parts of Utah. Rattlesnakes can do a lot of damage to you if they bite you. You don't want to mess with a rattlesnake. But sometimes we fear the wrong things, at least in the sense of, in addition to a lot of rattlesnakes, we also have a lot of deer. They should actually fear deer more than rattlesnakes. More people die in the United States every year as a result of deer causing automotive accidents than they do from rattlesnake bites altogether. Sometimes we fear the wrong things.
We fear making reform. But reform is not what we should fear; we should fear the consequences of failure to do that.
In some ways, the central unifying problem isn't just about the debt or dysfunction but the distrust. Congress has squandered the trust of the American people, and we as an institution have a responsibility to work hard to win back that trust. The only way to win back that trust is through real reform. We have to put the national interest ahead of our own interests, our own political interests and the special interests that are constantly moving here in Washington, DC. That work can begin with this very budget. It should begin with this budget. Budgets provide us with an opportunity to discuss our priorities. Those priorities always need to be all about reform.
This budget is far from perfect, but in understanding that it is not perfect, it is a vehicle to begin the real process of reform. Nowhere is this more important than with tax reform, and this will set in motion those events that can culminate in real, genuine, and much needed tax reform.
There are a couple of odd quirks within our Federal Tax Code. First of all, its sheer length and complexity are a problem. Arthur Brooks from the American Enterprise Institute said that complexity is itself a subsidy--a subsidy that disproportionately benefits the well connected, the wealthy, the well educated, the specialists who handle the complexity and profit from it. One hundred years ago, our Tax Code was only a few hundred pages long. Today, our Tax Code, depending on what you count, can fairly be described as much closer to 100,000 pages than to a few hundred.
Among the many problems we can find in the Tax Code is the marriage tax penalty, which many Americans are familiar with, whereby a hard- working American couple might pay higher taxes only because of the fact that they happen to be married. This is wrong, and it needs to be fixed.
There is a related point--a related flaw--that is much less well known than the Tax Code marriage penalty, and that is the Tax Code parent penalty. Let me explain what that is. Imagine two couples-- couple A and couple B. Imagine that couple A and couple B are identical in every respect but one. In other words, they both have the same income, they both have the same pattern of charitable contributions, mortgage interest, State and local taxes, and so forth. Everything that affects their taxes is the same except one thing: Couple A has three children and couple B chooses to remain childless. Because of the way our Tax Code interacts and intersects with our senior entitlement programs--namely, Social Security and Medicare--we end up penalizing parents, creating this parent tax penalty. Let me explain that a little bit.
Let's call couple A--the couple with three children--Jack and Julie. According to very modest assessments made by the U.S. Department of Agriculture, Jack and Julie, with their three children, will incur costs of about $700,000 as they raise their children. These are the costs of raising children. I believe it is a little faulty--there are a number of things it doesn't include--but it is an estimate produced by the U.S. Department of Agriculture. Jack and Julie, our hypothetical couple A, will spend $700,000 raising their three children to maturity. It doesn't take into account the non-economic costs associated with parenting or the myriad benefits that go along with that--but $700,000. That is the amount they will put into raising these three children. That cost doesn't benefit just Jack and Julie, it doesn't benefit just their three children--no, the way our system works, the way Social Security and Medicare work, it also goes to stabilize, to shore-up entitlement benefits for tomorrow's retirees, because Social Security and Medicare operate on a pay-as-you-go basis. Today's retiree benefits are paid by today's workers. Today's workers will be tomorrow's retirees. Today's children will be tomorrow's workers and will be paying the retirement benefits of today's workers, tomorrow's retirees.
Let's look at couple A, back to Jack and Julie. Jack and Julie operate solely with Julie's income. Jack is a stay-at-home father. Meanwhile, Julie has a good job that pays $75,000 a year. As you look at this chart, it shows how the pay stubs Julie receives twice a month might look.
I would imagine many Americans look at this the same way I do. People approach their pay stubs with a degree of trepidation. It is almost easier not to look at it when you see all the things the government does to your paycheck each time it goes through.
Jack and Julie look at Julie's pay stub when it comes out twice a month, and they see a few things, including the fact that, in addition to the $205 that is withheld from her Federal income tax twice a month, she also sees $41.84 withheld for Medicare, $178 withheld for Social Security, and $144 withheld for State income tax.
So when we look at Julie's pay stub, we see that what Julie is paying into Social Security and Medicare is roughly the same as what we will see from couple B, who chooses to remain childless. Couple B has every right not to have children. We don't want to penalize anybody regarding their decision on whether to have children. But the point here is that the investment Jack and Julie are making into the Social Security system comes twice--first as they pay their taxes, including their Social Security and Medicare taxes--and with Social Security taxes, by the way, that is also going to play a role in determining the Social Security benefits for which Jack and Julie will one day be eligible when they retire. Yet the Tax Code doesn't adequately take into account the $700,000 they are investing into their own children and that those children will make it possible for couple B to receive their Social Security and Medicare benefits when they retire. That is why we need to fix the parent tax penalty.
The parent tax penalty consists of this unique interaction between our tax system and our senior entitlement programs and doesn't take into account the intense investment in financial terms that America's moms and dads make in their children.
By increasing the child tax credit, we could offset this penalty. One of the proposals out there would involve raising it to, say, $2,000 per child. I think that would be great. I could even go higher than that, but $2,000 wouldn't cover the whole problem, it wouldn't undo the whole penalty, but it would go a long way toward offsetting that. I would welcome that. That would be a good development. There are people just like Jack and Julie Jones all over this country who would benefit from that, and the American people as a whole would benefit from it. Social Security and Medicare would be more stable and made more sustainable by this change.
The next step we need to make with tax reform involves making the Tax Code more pro-worker. A lot of people criticize the Tax Code for the fact that it has the highest corporate tax rate in the industrialized world at 35 percent. I believe that the best reform we could achieve would be substantial. There are a lot of people who are talking about reducing the corporate tax rate to maybe 15 percent or 20 percent. I hope we can get to something like that, and that would be a great first step. What I would really like to do is to bring that down not to 25 percent or 20 percent or 15 percent, I would like to see it brought down to zero. Let me explain why I believe that.
A corporation consists of and is animated by two things: capital and labor, investors and workers. Investors and workers join together and form partnerships to make profits. Both of them
pay a share of the corporate tax. In the United States, forces of globalization have benefited from this arrangement between workers and investors. The forces of globalization have benefited the investor class more than the workers. In this new global economic environment, we need to think about how to increase the returns to workers.
Globalization has helped the investors, and policy now needs to go out of its way to help the workers. One way to do that would be to eliminate the corporate tax altogether and tax investment income the same way we do regular income. That would shift the worker share of business tax to business owners. This would immediately do two things: It would give a raise to American workers, who really need it, and it would turn the United States into an irresistible magnet for foreign investment in the United States of America. In one stroke, the most profitable, favorable tax strategy in the global economy would be creating American jobs.
The current code gives preferential treatment to U.S. investors sending their money overseas. While this is their right to do, this is not something we should be incentivizing and pushing them into, which is exactly what the status quo does. Reform would give preferential treatment to international investors coming here, which is, after all, what we want. Let's level the national playing field between the working class and the investor class, while tilting the global playing field toward the United States rather than pushing it outward, away from our great country.
If these tax reforms could be set in motion through this budget or at least set in motion indirectly if not directly, the Tax Code would finally start working again for American families and finally start benefiting hard-working American mothers and fathers.
Another issue that we struggle with significantly in the Federal Government involves Federal regulations. This, too, is something we could start to address through the budgeting process. Our Federal regulatory system is economically damaging. This is something that strangles small business. It inherently--by its very nature, it inures disproportionately to the benefit of large, established, incumbent businesses, those that can afford an army of lawyers, accountants, lobbyists, and compliance specialists, that benefit from a heavy system of regulation, which is often made heavier still at the urging of the largest, wealthiest, most established companies because these Federal regulations provide a natural restriction on entry, a natural barrier that disincentivizes and in some ways disables would-be competitors from joining and entering into the marketplace. One thing we know about competition is that it brings down costs and it raises quality, and that is a good thing.
Federal regulations also create a sort of constitutional distrust. They themselves represent a harsh deviation from the natural constitutional order. I mentioned a few minutes ago the provisions of article I. Article I, section 1, and article I, section 7 require that Federal laws be passed by Congress. Federal regulations get around that.
Sometimes Congress chooses voluntarily to delegate to someone else the task that we, by operation of the Constitution, are supposed to perform and not to delegate to someone else. This administrative action makes things easier on occasion for Congress, but that is a bug, not a feature. The Constitution never was intended to make life easier for Members of Congress.
Let me explain how this happens and how it shows up here. It happens sometimes with good intentions. Congress wants to approach a particular issue, solve a particular problem without necessarily having to go into the difficult, painstaking, line-drawing process that inevitably is brought into question anytime we are trying to solve a problem through lawmaking. In other words, Congress will identify a problem and pass a law that says, for instance: We shall have a good law in area X, and we hereby delegate to agency Y the power to make and enforce rules carrying the force of generally applicable Federal law that will carry out the objectives we have outlined in our legislation.
In other words--let's get to something more approximating a real example. Congress, for instance, passes a law that says: We shall have clean air. We hereby delegate to the EPA the power to decide what clean air is, what pollution is, what acceptable limits on pollution might be, and what penalties will befall polluters. And then those same regulators, those same people at that same agency who made all the rules defining pollution and defining acceptable limits for pollution, prescribing penalties, they are the same people who also enforce them. You have the lawmakers who are also the law enforcers, and none of them are subject to an election.
Now, I don't mean to disparage the character or the capabilities of any of the fine people who work at the EPA or any of our other Federal bureaucracies. For the most part, these are well-intentioned, hard- working, well-educated, and highly specialized public figures or government employees, we might say, but there is a difference.
People in Congress are not magically empowered with any gifts for coming up with good legislation any more than any other American is, but there is a difference. We are elected, and we are subject to the people at regular intervals. You can fire your U.S. Senator every 6 years, you can fire your Representative every 2 years. You cannot fire a government bureaucrat. As Ronald Reagan said, the closest thing we see to eternal life on this Earth is a new government program. The closest thing you can find to a lifelong career is in government, in many government bureaucracies.
What this has produced is a profound proliferation of Federal law. We have been able to make more things Federal, and we have been able to make more Federal laws as a result of the fact that Congress now delegates away far more of its legislative power than it actually exercises. Let me explain what I mean.
I keep in my office two sets of documents. I welcome any of you to come by. In my office, we serve Jell-O every Wednesday at 3:30. For reasons I don't entirely understand, Utah consumes more Jell-O than any other State in the Union on a per capita basis. The Utah Legislature has actually designated Jell-O as Utah's official State snack. Now, I will be clear that these are not Jell-O shots. They are not tainted with alcohol or anything like that, but we serve Jell-O every Wednesday at 3:30. You are all invited to join us any time you would like. If the Senate is in session and if it is Wednesday at 3:30, it is time for Jell-O.
When you come by my office for Jell-O Wednesday, you will see two stacks of documents that I have represented in this graph. One stack of documents is a few inches tall, it is about 3,000 pages long, and it consists of the laws passed by Congress last year. The other stack is 13 feet tall, it is about 96,000 pages long, and it consists of last year's Federal Register.
For those of you who are fortunate enough not to know what the Federal Register is--and I really do envy you--it is the annual index, the compilation of Federal regulations. First is their release for public notice and comment, and then later is their finalized Federal Register.
These are laws. These are not just rules exclusively deciding what time the lights will go on and off at the Commerce Department or what times the gates will be staffed at this or that Embassy. No. Many of these are regulations that impose affirmative obligations on the American people, sometimes with criminal penalties, often with substantial civil penalties attached to them, and yet they are not passed by anyone who is elected. In many cases, they are not even written by people who are accountable to anyone who is, in turn, elected. This is a problem.
During 2016, Congress enacted 214 laws; whereas, the agencies issued 3,853 rules. Those are 18 rules that were put in place by Federal agencies for every 1 law that was enacted by Congress. This is not without consequence. This is not just an abstract constitutional violation.
This costs the American people a lot of money, and it costs them money in a way that is kind of invisible. You have the Tax Code. You have your pay stub. I showed you that chart earlier from Julie's pay stub showing how much the government takes out of each paycheck. That is visible. That is tangible. That is something she can see each week. There is another bite that
gets taken out of each and every one of her paychecks that is invisible, and that bite is taken out by these Federal regulations, meaning everything that Jack and Julie, everything that every one of you, everything that every American purchases, every good or every service is made more expensive by these Federal regulations. In fact, it is fair to say really that the costs of compliance with these Federal regulations are passed on disproportionately to America's poor and middle class who pay for those regulations through higher prices on goods and services, diminished wages, unemployment, and underemployment, and it is not insignificant.
Twenty years ago, when I first started studying this problem, I was shocked to learn that this backdoor, invisible, highly regressive form of tax--that is the cost of compliance with Federal regulations--stood at $300 billion a year. That was astounding to me, stunning. Today that number stands at about $2 trillion a year. In 20 years, we have seen the cost of complying with Federal regulations multiply nearly sevenfold. That is troubling.
If the cost of complying with U.S. Federal regulations were a country, if it were the GDP, the $2 trillion in compliance costs, that is roughly the same as the gross domestic product of India and Italy. The cost of complying with Federal regulations is slightly less than the GDP of India and slightly more than the GDP of Italy. That is sad, that is stunning, that is a constitutional problem, and it is a public policy problem. The 2016 Federal Register contains 95,894 pages--the highest level in its history and 19 percent higher than the previous year of 2015, which contained 80,260 pages.
In the absence of trust, we need an abundance of transparency, and that is what constitutional lawmaking is all about. We need to restore that constitutional order by passing reforms like the REINS Act, which would require congressional assent before major rules are put into place. It would require Congress to affirmatively enact a regulation into law before an economically significant regulation could take effect.
There are some other areas where we need transparency--in higher education and healthcare. These things appear to have little in common at the outset, and yet, in many ways, they have a lot in common in that they are two areas where there has been a lot of Federal involvement where there probably shouldn't be and where that Federal involvement has made things more opaque and less transparent and resulted in higher costs.
In higher education, I highlighted the need in the last Congress for reforms through my introduction of the Higher Education Reform and Opportunity Act, which would have opened up the accreditation process. Currently, the higher education system in America has been commandeered by the iron triangle, consisting of the U.S. Department of Education, Federal accreditation bodies, and institutions of higher education in this country. Unless you are part of that iron triangle, you can't really break into the higher education market because you can't get Federal higher education assistance.
As a result, things like apprenticeships, distance learning, massive open online courses--or MOOCs, as they are sometimes described--suffer. They get left out. The upshot is, if we reformed this area, we would have more opportunities to get postsecondary skills and training, we would lower the cost of higher education, we would save money for both borrowers and taxpayers alike, and we would have more people able to pursue their chosen vocation.
With healthcare, as in higher education, Federal influence is driving up prices while outcomes are flatlined. In 2009, Congress doubled down on what wasn't working when they passed ObamaCare. The results were instability, lost coverage, new plans, higher premiums, and higher deductibles at the same time.
Meanwhile, you had a whole lot of concentration of market power in a few companies. The top 10 health insurance companies in 2008--the year President Obama was elected President--had combined profits of about $8 billion a year. Last year, that number skyrocketed to $15 billion a year. The difference was ObamaCare.
ObamaCare made it easier for those companies to see their profits skyrocket, but they did so on the backs of America's poor and middle class. With ObamaCare, we also had the unsustainable expansion of Medicaid, a failed program we should be trying to rescue people from, not trap them in. We need to repeal and replace ObamaCare.
As we look toward reform, a guiding principle should always be restoring the constitutional principal of federalism or some might call it localism or the principle of subsidiarity. The idea is that you should govern locally, as locally as possible. There is a reason for this. The Constitution requires it, but it is also the case that we all benefit when we follow that constitutional system. It allows more Americans to get more of the kind of government they want and less of the kind of government they don't want. Bad things happen when we ignore federalism, as we have over the last 80 years and increasingly so over the last decade. There are some examples of that.
One involves transportation. Our Interstate Highway System was created by the Federal Government in the 1950s under the leadership of President Eisenhower. He acknowledged that for national security and interstate commerce reasons, it would be a good idea to have an interstate highway system. So we proposed--and Congress passed into law--a gasoline tax that would fund the establishment, the creation of an interstate highway system. The idea was always to hand that interstate highway system back over to the States after the project was completed, which it has been now since the 1980s. Yet we are still collecting a Federal gasoline tax--18.4 cents per gallon, to be precise. Yet that 18.4 cents per gallon still doesn't ever seem to be sufficient, even though the Interstate Highway System has been completed since the 1980s and even though, stunningly, you could maintain the existing Interstate Highway System for about 4 cents per gallon. So where is the rest of it going? Well, it is going to purely local projects: surface roads, bike paths, all sorts of other things, many of which might well be worthy but aren't necessarily Federal in nature.
Another example involves public land. A lot of people were surprised to learn this--especially people from the East--but the Federal Government owns and controls about 30 percent of the land in the United States. A lot of people in the East aren't aware of this because, in every State east of Colorado, the Federal Government owns less than 15 percent of the land. In no State west of Colorado does the Federal Government own less than 15 percent and, in many States like my own, that number is much larger. In fact, in my State, the State of Utah, the Federal Government owns 67 percent of the land.
Let's set aside the question, for a minute, of why the Federal Government needs to own that much land at all and why it needs to own 30 percent of the landmass in the United States. If it is going to own that much, why does it disproportionately own so much land in States like mine, especially when that harms people in States like mine?
You see, in Utah--this map shows Federal land. Anyplace you see white, that is non-Federal land. If you see any of these colors represented here, that is one type of Federal land ownership or another. Where you see color on this chart, that is where the Federal land is owned and controlled by the Federal Government and the local taxing authorities can't tax it. As a result, people have to go to the Federal Government for a ``Mother May I'' in order to even cross the property or utilize the property for some legitimate business or personal need, and the local taxing authorities can't tax it. This harms westerners disproportionately, and it is wrong. We need reform in this area.
We also need to get the Federal Government out of the business of thinking it needs to own this much land and into the business of thinking, if it is going to own that much, then it needs to allow taxing authorities to collect at least a rough equivalent of property tax.
Also, in the area of primary and secondary education, because public education is so important, the Federal Government needs to stay out of the K-12 education arena. In other words, what is taught in the K-12 classroom
needs to be decisions made by teachers in consultation with parents, principals, local school officials and, in some cases, State officials, not from Washington, DC. That is not an appropriate decision to make from Washington, DC, unless you are talking about educational experiences perhaps in the District of Columbia or a U.S. territory or on a military base or something like that.
The Federal Government should have no role in K-12 public education. That is not our job. We have to remember the text of the 10th Amendment echoing the structure of the original Constitution: that powers not granted to Congress and not prohibited to the States are reserved to the States respectively or the people. That has to mean something. In order for it to mean something, there has to be some limit to what powers are, in fact, granted to the Federal Government.
Over the last 80 years, we gradually drifted away from this idea. We concluded that every problem in society is a government problem and that every government problem is a Federal problem. That is wrong. That has harmed the American people.
We need to restore federalism, localism, and subsidiary. This will free the people of the tyranny they feel as the result of a lost election. At any given moment in America, there are people who are disappointed about the last election, especially so with House elections, Senate elections, and the occupant of the White House. At any given moment, the people who feel as if they are not well represented in Washington--either at the U.S. Capitol or at the White House or both--can be counted in the tens, if not hundreds of millions. We will end this tyranny if we return a lot of that power.
In other words, let's say someone living in Connecticut might not quite be on the bandwagon of ``make America great again.'' If they don't want to make America great again, they can want to make Connecticut great again. In other words, federalism allows more people in America to get more of the kind of government they want and less of the kind of government they don't want. It allows more people to have more of a say because local governments, while not perfect, are more responsive to their local constituencies. It better protects both the minorities and majorities. It lowers the temperature of our national politics. One of the reasons national politics have become so contentious is because everything has been centered in Washington, DC. There is no reason it has to be that way. In fact, the Constitution says it should never be that way.
Finally, with regard to federalism, there are a few things that only the Federal Government can do. Those things include national defense, establishing a uniform system of weights and measures, coming up with a uniform system of laws governing immigration and naturalization and a uniform system of laws governing interstate and foreign trade or commerce. Those things that can be done only by Congress must be done well. When we are so busy doing the things we are not supposed to do, we fail to do those things that only we can do. That is yet another reason to restore federalism.
Then, whatever is left over, whatever remains, whatever we can't bring back, needs to be fixed. It needs to be made to work. Whatever we don't return to the States can be made more effective and more efficient, and we should do that.
The 1974 Budget Act, as I explained at the outset of my address today, is outdated. We have to reform it. The Congressional Budget Office and the Joint Committee on Taxation use formulas that are opaque and unknown, that are effectively a black box. This is wrong, and we have to get rid of those.
That is one of the reasons I introduced the CBO Show Your Work Act, so they can't just tell us anymore: You can't know why we reached the conclusions we reached that have stunning implications for law and public policy.
From budget, to taxing, to spending policy and policymaking, the constant theme is inertia. One could argue that the consistent theme is nostalgia. We are stuck in that era of the Ford Pinto and the eight- track cassette player. Americans are being held back, not only by outdated policies but by a process that is out of date too.
We met the challenges of the 20th century with policies that met the moment, but we have to be constantly updating, constantly overseeing and tweaking and improving. Government may well move at the pace of a turtle, but it can move, nonetheless, and move it must because the only way to get to next is to focus on now.
In our increasingly personalized, customizable society and economy, government's obsession with centralization is making these things worse, not better. We need to govern locally and not nationally in every single instance. We need to empower individuals and local communities.
In Washington, we have to embrace accountability, especially the kind of accountability prescribed by the Constitution. We can do better, but we have to first recognize the need to do so.
The budget is indicative of all the problems we face in Washington. It is also indicative of Congress's authority and its ability to create solutions. We can do this. We can. We must. And together, we will.
Thank you, Mr. President.