Floor Statements

Mr. Speaker, I would just like to speak about what some consider boring statistics on government growth. I can add later in this 5-minute short brief, on where we are on not only overspending but over-promising.

We are now doing the appropriations bills. This is my last year in Congress. In the 12 years that I have been in Congress, all spending appropriations are increasing much faster than inflation. That means government is growing faster than everybody else's financial pocketbook who are citizens in this country.

Some years we have seen 3, 3\1/2\, one year almost 4 percent growth in the Federal Government faster than inflation.

The percentage of our total Federal budget that goes to service the debt, pay interest on the debt, of our annual overspending is now $7 trillion. And what it costs the taxpayers of this country to pay the interest on that debt is 14 percent of our total Federal spending. 14 percent represents a little more than $300 billion a year that we are spending on interest.

And so I ask, Mr. Speaker, guess what is going to happen to interest rates over the next couple of years or the next 10 years. Interest rates are going to go up. They are now at a relatively low percentage. And if the lower percentage represents a cost to us of $300 billion a year, what if interest rates were to go back up to where they were in the early 1980s?

Now, let us move from the high interest rates and that cost to taxpayers in the future to how much the total debt of this country is increasing. Now, I mentioned about $7 trillion current debt. We are increasing the debt now by over $500 billion a year. That means that this body, this Congress, these Members are going to have to look their grandkids in the face and try to explain today's overspending, saying something, some excuse, it was not my fault, it was somebody else's fault that taxes in your generation are so high.

We are going to hear a lot of rhetoric during these appropriation bills that Congress should spend more, in other words, go deeper into debt. And it is somewhat of an egotistical attitude that somehow we are pretending that our problems today are greater than what the problems are going to be for our kids and our grandkids.

Let me conclude by suggesting that it is not good for our security in this country. The Department of Treasury reports that 45 percent of our marketable debt for this government is held by foreign interests. Last year the overspending, which means more borrowing, resulted in 75 percent of it being picked up by foreign interests. China is now the country that is accumulating more of our debt. Just imagine, for a moment, the vulnerability that puts us in when we become so subject to another country in any kind of negotiations. Whether it is military or whether it is trade, and that country that owns so much of our equity says, well, you might not be the country we wish to invest in. That would put us in a very serious economic situation.

I conclude with the estimate by the actuaries of Medicare, Social Security, and Medicaid that are now predicting that the over-promising, the unfunded mandates, meaning how much money we are going to have to come up with over and above what is coming in currently in the FICA tax, the payroll tax, to accommodate the extra spending that is needed, again over and above the money that is coming in, is $73.5 trillion. So if one adds the unfunded liability of $73.5 trillion to $7 trillion debt, that means $80 trillion plus responsibility that we are loading on our kids.

I am a farmer from Michigan. We try to pay down the mortgage on the farm. This body is in effect saying let us spend more, let us solve more of the problems by borrowing more and let us pass the bill on to our kids.

Mr. Chairman, I rise to make the point that under the current law, there are no limits for government price support payments to farmers using commodity certificates.

If commodity certificates and loan forfeitures would have been included under the payment cap limit like in the Senate version of the 2002 farm bill, the CBO has estimated we would save $118 million in FY 05 alone--$118 million--that could be used for some other very worthy initiatives in this agriculture appropriation bill or larger supports for family farmers.

We all have heard the news reports about large corporate farms receiving millions of dollars in government payments through the use of generic commodity certificates. Generic certificates do not benefit average family farmers but allow the largest farmers to receive unlimited payments. It is not good public relations for agriculture or our next farm bill.

Under our current system, when the $75,000 limit is reached, producers can continue to receive unlimited price support benefits through loan forfeitures and generic commodity certificates. Generic commodity certificates are in practice the same thing as marketing loan gains, yet they are not included under the payment limitations.

Thus, generic commodity certificates are essentially loopholes allowing large farming operations to exceed the payment limits. Should it be the objective of federal farm policy to provide virtually unlimited price support to large farming operations?

To add insult to injury, in a May 2003 article published in Tax Notes, it shows that gains from commodity certificates are not reported to the Internal Revenue Service.

Reading some of the comments following the USDA's Payment Limit Commission Report from last fall, it seems important to stress the fact that a few large farmers utilizing generic commodity certificates are avoiding payment limits.

While the Commission indicated that no changes should be made to payment limits until the next farm bill, we need to seriously consider where our agricultural appropriations money is going. Should the Federal Government be paying over 50 percent of the gross income for certain commodities?

It is often argued that cooperatives need to use these commodity certificates as a marketing tool and that the money is spread over numerous producers. This argument dodges the real issue, however, that generic certificates provide a loophole for large producers in the cooperatives to collect unlimited dollars in federal subsidies above and beyond the so-called payment limits.

Even within such co-ops, individual farm production records can be used to enforce compliance if this loophole were closed. As you may know a majority of the Senate and the House voted to instruct conferees to have ``real'' payment limits. Unfortunately, the conferees did not follow through. The next farm bill is at risk of overly severe limits if continued abuse is evident.

The CBO projected savings of $118 million for FY05 and nearly a half billion dollars during the 5 years of our current farm bill.

That money could be used to fund the National Research Initiative, NRI, which is a national grant-based agricultural research program for our public and private scientists. The NRI was authorized in 1994 at $500 million per year, but has received less than $200 million every year since its inception. This kind of research can allow our farmers to be more productive and efficient, being less dependent on Federal farm programs.

The NRI has provided the agriculture community with valuable research such as sequencing the rice genome, disease resistance in soybeans, and improved management practices for livestock and crop producers.

Supporters of payment limits argue that large or unlimited payments benefit large farms, facilitate consolidation into larger units, raise the price of land, and put smaller, family-sized, or beginning farming operations at a competitive disadvantage.

Critics of payment limits counter that all farms are in need of support, especially when market prices decline, and that larger farms should not be penalized for the economies of size they have achieved.

Although the effect of payment limits can vary, affected farms are usually relatively large. Cotton and rice farms are affected more frequently because they tend to be larger and their subsidy value per acre is relatively high. Cotton and rice farms are also the largest users of commodity certificates in the marketing loan program, an important fact for payment limits.

Under the 2002 farm bill, producers receive three types of commodity payments that are subject to limits: direct payments, counter-cyclical payment, and marketing loan payments. With respect to payment limits, direct and counter-cyclical payments are relatively straightforward since they are direct transfers made in cash. Marketing loans, however, are more complicated.

The marketing loan program has four mechanisms to provide benefits when market prices are below loan rates: (1) loan deficiency payment (LDP)--a direct payment instead of a loan; (2) marketing loan gain (MLG)--repaying a loan at a lower market price (posted county price, or average world price for cotton or rice); (3) ``commodity certificates''--purchased at the posted county price to repay the loan; similar to a MLG but without payment limits; and (4) forfeiting the collateral (commodity) and keeping the cash.

The 2002 farm bill retains annual limits on selected commodity program payments. It creates a prohibition on payments to persons or entities with adjusted gross income exceeding $2.5 million--unless 75 percent or more comes from farming.

The annual limit per person is $40,000 for direct payments, $65,000 for counter-cyclical payments, and $75,000 for marketing loan gains and loan deficiency payments. However, because commodity certificates and forfeiture of commodities are not subject to any limits, the limit on MLGs and LDPs simply becomes the point at which the farmer shifts to commodity certificates. So, as a practical matter, the marketing loan program is not limited.

Mr. Chairman, again I want to reiterate the pro-farmer, practical need to close the payment limit loophole. Without putting constraints on the benefits earned through marketing certificates and loan forfeitures, the annual per person payment limit on the marketing loan program is not a true limit on federal payments to large farmers with budgets that must be restrained the challenge of writing the next farm bill that will keep American agriculture strong will be a huge task.

Mr. Speaker, after listening to the previous speakers, Mr. Speaker, I think of Ronald Reagan's words, There you go again.

Every 4 years we sort of experience the spinning and the demagoguery that takes place in this chamber using these podiums and C-SPAN to criticize the sitting President. Of course, Republicans did it 4 years ago and 8 years ago.

When I first came into office and was elected in 1992, the Democrats in this Chamber were using this forum to criticize the first President Bush, all the things that went wrong. But I think of what the criticisms were of President Reagan when he came into office. When President Reagan came to office America was demoralized. President Carter had spoken about our malaise in Watergate, and our defeat in Vietnam had all shaken our self-confidence.

We had given up the Panama canal. The Shah of Iran and supporters of the Ayatollah Khomeini held 52 of our Americans hostage for more than a year at our embassy in Tehran. The military rescue mission, of course, failed in the desert, and we lost eight of our servicemen in that venture.

Communism was on the march, and after South Vietnam fell, Cambodia followed. The Sandinistas took control of Nicaragua and Communist insurgencies were underway in Ethiopia, Angola, and certainly the Soviets invaded Afghanistan in 1979 and were suppressing the solidarity movement in Poland.

Our economic situation was very dire in 1980, and President Reagan came in and actually renewed our faith. America, in most American's minds, no longer seemed to be special, and we needed that kind of determined leadership.

The point I want to make, in reacting to some of the Democrats' criticism of this administration, was the criticism that President Reagan received when he believed we should stand up to the Soviet Union and we ended up doing that.

It was President Reagan's resolve that repulsed communism in the Caribbean and Central America and repulsed it also in Afghanistan. It was Reagan's resolve that nurtured solidarity in Poland and gave heart to the dissidents of the Soviet bloc, and it was Reagan's faith in American ideals that toppled the Berlin Wall. All of this time he was being criticized as being a trigger happy President that might push the red button for a World War III with the Soviet Union.

When he went to Berlin, and he was writing a speech for Berlin, he started out writing in that he wanted to include ``Mr. Gorbachev, tear down this wall,'' and all of his advisers and his speech writers said, no, do not do that; it will anger the American people and the world. They will think you are too bold; they will think you are too challenging. That might end up in war. You should just try to get along and make peace. But he insisted it go in despite that criticism, and that leads me to what historians are going to say 30 years from now in analyzing the decision and the determination of this President to go into Iraq.

Most everybody in this chamber and the Senate had the same kind of intelligence information that the President and the administration had. Some of that intelligence information, we have now discovered, was very inaccurate in some regards.

Iran

Mr. Speaker, I want to tell my colleagues and the audience, Mr. Speaker, about the new threat and the fact that some Democrats are saying, look, you have got to do something about Iran. Iran was one of the several countries after 9/11 that we knew were developing weaponry, that we knew that was a country being led by a tyrant dictator that was not trustworthy in terms of the threats and the blackmail. Iran today is becoming increasingly active in its drive not only to derail Iraq democracy but to lead the Islamic radical movement into the future.

In recent months, we have seen a series of provocations in Iraq that could be considered acts of war, that may make a coalition response necessary.

Iran appears to have financed and encouraged the Shiite cleric Muqtada al Sadr's Mehdi Army in their resistance and which was behind the April uprising in Sadr City and Najaf. Al Sadr continues to denounce the new Iraqi government. How much of this is coming from Iran? We now know that some is.

We held a recent hearing in our Committee on International Relations, and we found out that border patrols have captured at least 83 Iranians trying to cross illegally into Iraq, and there are several reports of brief incursions of the Iranian troops into Iraq along the borders.

Also in June, Iranian military forces hijacked a small British navy vessel in the Shatt al-Arab waterway with eight crew members aboard. The relief crew members say they were hijacked in Iraqi territorial waters before being escorted into Iran.

On July 5 American-Iraqi joint patrols, along with U.S. special operations teams, captured two men with explosives in Baghdad who identified them as Iranian intelligence officers, and I am relating now to the problems in Iran because it was one of several countries that intelligence says was developing mass weaponry and that was using that weaponry to blackmail its neighbors and threaten the world.

In addition, Iran has been working actively to produce chemical, biological and nuclear weapons, along with ballistic missiles for delivery. The Under Secretary of State John Bolton testified before our Committee on International Relations: The recently apprehended Pakistani proliferator Dr. A.Q. Khan has confessed to having shared nuclear technology with Iran. North Korea has provided missile technology, including the SCUD B, the 300 kilometer range missiles; and the SCUD C, the 500 kilometer range missiles. Iran's Shahab-3 missile is thought to be based on North Korea's so-called No Dong missile design.

The International Atomic Energy Agency inspectors say that Iran is in violation of its commitments as a signatory of the non-proliferation treaty. Iran is engaged in prohibited uranium enrichment activities, is in the process of constructing a heavy water reactor designed specifically to produce large quantities of plutonium usable for weapons and is seeking to produce polonium-210 which is used as a weapon initiator.

Iran failed to announce any of these activities as required by the non-proliferation treaty, and they go well beyond any conceivable, peaceful nuclear program. Iran has responded to these charges by threatening to end inspections and withdraw from the non-proliferation treaty.

My point is, Mr. Speaker, that we are facing a new challenge, somewhat unlike the challenge of the Cold War with the Soviet bloc, but every bit as challenging, every bit as dangerous.

The State Department continues to recognize Iran as the world's foremost State sponsor of terrorism. Iran's links to Hezbollah, Hamas, Palestinian Islamic Jihad, the Popular Front For the Liberation of Palestine, the al Aqsa Martyr's Brigade and the al Qaeda, has been directly implicated in the 1983 bombing of the U.S. marine barracks in Beirut, a series of bombings in 1986 in Paris, the 1992 bombing of the Israeli embassy in Buenos Aires and the 1996 Khobar Towers in Saudi Arabia.

In recent weeks, two Iranian diplomats assigned to the U.N. in New York were ejected for spying. The diplomats were said to be photographing sensitive sites.

Iran is clearly one of the most dangerous countries in the world and appears to be stepping up its efforts against a free Iraq. The West and the United States, we are working with allies to try to contain these threats. It cannot be just the United States.

Iraq

Mr. Speaker, again realize that the U.N. is made up of some of these tyrant dictators. The U.N. is made up of individuals representing some of these countries with very selfish motivations.

When we look at the 13th and 14th resolution of trying to convince other nations to join with us in countering what was happening in Iraq with their

total disregard for the 13 resolutions, saying that there has to be inspectors, with Iraq kicking these inspectors out, it was countries like France and Germany and Russia that had deals with Saddam that were going to lose money if there was an invasion of Iraq. They were trying to actually lift the embargo on Iraq at that time because they could profit by it.

The chairman of sort of the counterpart for the Committee on International Relations from the Duma, the Soviet Union in Moscow, came before our Committee on International Relations, and he was talking about and mentioned that Iraq and Saddam Hussein owed Russia between $9 and $12 billion. One of us said, well, if the United States guaranteed that you would get that paid back, would that make a difference in how you would vote in the United Nations on the Iraq resolutions? He said, well, of course.

Here again, my point is that these countries are looking out for their self-interests, and if the United States is willing to spend its money, it is easy for some of these countries to stand back that might lose by going into Iraq, other countries that might lose by having to contribute finances at a time when their budgets are under the same kind of pressures ours are, and so I come back to how historians will look on our action after 9/11, going into Afghanistan and going into Iraq to try to counter the terrorist threat that is now facing the new free world.

I cannot help but criticize those individuals that try to play partisan politics to the extent of showing their exuberance in criticizing this administration for actions that most of that side of the aisle, certainly most of this side of the aisle, voted on when we voted to give the President the authority to militarily go into Iraq.

Delaying November Election

Mr. Speaker, there has been discussion, that I just want to comment on, about criticizing this administration for suggesting that we might delay the election. Every Republican I know in this Chamber and in the Senate have said no way are we going to postpone the election.

If there is any agreement that needs to be made in terms of potential terrorist disruption of the election, it is an agreement by the Republicans and the Democrats that we are going to have the election; that we are going to count the votes; and whatever the votes are is going to determine who is going to be the next President of the United States.

Social Security

Mr. Speaker, I am going talk a little bit about Social Security this evening, but also it is partisan politics and demagoguery that I would suggest has been the reason why we have not proceeded with a solution on Social Security. We have known Social Security is going bankrupt, and we have known that for the last 14 years.

In fact, I wrote my first Social Security bill when I was chairman of the senate finance committee in the State of Michigan, and I brought it to Congress and I introduced it. I have introduced five Social Security bills, all of which have been scored by the Social Security Administration to keep Social Security solvent, and I have considered this one of my priorities in Congress because not solving this problem of keeping Social Security solvent and putting it off means that there is going to be much more drastic solutions that will have to be made in the future to keep Social Security solvent.

In terms of the demagoguery, it is easy to criticize anybody's suggestion on solving Social Security or Medicare or Medicaid, some of the overpromising we have done in those areas, because, for example, in Social Security, we have 80 percent of all of the retirees that are very heavily dependent on Social Security for their retirement income. So you can understand that it is very easy to frighten these people by saying, well, look, that Republican or this Republican wants to jeopardize your Social Security benefits.

And, boy, they want to privatize it; and the snake oil salesmen are going to lose it; and you will end up not having Social Security. Of course, I am paraphrasing, but you can understand that it is easy to scare seniors rather than coming together. And it has to be a coming together, Republicans and Democrats, to solve Social Security.

On this chart, Mr. Speaker, it is a pie chart of how we are spending money this year. As you see, the biggest piece of pie, the biggest, largest expenditure of the Federal Government, is Social Security, at 21 percent. The domestic discretionary programs represent 16 percent. We spend most of the year in our 12 appropriation bills, outside of defense, arguing about how we are going to spend that 16 percent of the total Federal spending.

Most of it is entitlement programs on automatic pilot. Even interest over here is essentially on automatic pilot. But I think it is important also to mention the dangers that are facing our kids and our grandkids in terms of increasing the debt of this country. Fourteen percent of the total Federal budget is used servicing the debt, or paying interest on the debt that we owe. That represents over $300 billion a year, and this is at a time when interest rates are relatively low.

We saw Greenspan and the Fed raised interest rates a little bit a few weeks ago. Probably another two times, maybe three times the rest of this year there might be another quarter. Maybe one of these times, depending on inflation, they might go up as much as a half. But the fact is, interest rates are going up. That means this piece of the pie is going up simply to pay interest on the outstanding debt, which is now $7 trillion.

And we are adding to that debt by our annual deficit spending. Now, deficits mean how much we overspend in 1 year. Debt is the adding up or the sum of all those annual overspendings. And as I mention, that is now $7 trillion. But we are increasing the debt by over $500 billion a year.

How do you put that in perspective? I think about the fact that we are a 228-year-old country, and it took the first 200 years of this country to get up to the first $500 billion of debt. Now we are going deeper into debt $500 billion a year. For lack of a better word, it is unconscionable for Washington to be so egotistical that they think our problems today justify taking the money from our kids and our grandkids that they have not even earned yet. What I am saying is this huge burden of the debt is going to be placed on future generations.

And the debt is only part of it. Overpromising. There is no question a politician that goes home and promises new services, new benefits coming from government probably gets on television or on the front page of the paper. And politicians that take home the pork barrel projects, that are seen cutting the ribbon probably are more likely to get elected. So we have been overspending and overpromising.

The green eyeshade people, our economists, call the overpromising unfunded liabilities. Unfunded liabilities mean that we do not have enough money coming in to accommodate those promises. This chart shows how much we are going to have to take out of the general fund to accommodate Social Security and Medicare and Medicaid. And by 2020, it is going to take 28 percent of the general fund budget, added to our payroll tax, our 15.2 percent payroll tax, to accommodate the shortfall, or the shortage between what we have promised in these programs and the extra money needed to keep those promises. If you go up to 2030, it is going to take over 50 percent of the general fund budget.

Are we going to take 50 percent of the general fund budget? No. That means tax increases. Or, if we do not have the guts, if we do not have the intestinal fortitude in Congress and in the White House, it means maybe adding to borrowing, which is going to add to the burden of interest.

After I voted against the prescription drug bill, Tom Savings, one of the actuaries, came to my office and said, these are my calculations of the unfunded liability, of what it is going to take in these programs over and above the money coming in from the payroll tax. Medicare part A, which is mostly hospitals, is going to be almost $22 trillion unfunded. Medicare Part B is going to be $23 trillion unfunded. Medicare part D, the new drug program, adds $16.6 trillion of unfunded liability. Social Security is $12 trillion unfunded liability.

Again, that means that that $73.5 trillion would have to be put into some kind of a savings account or investment account that is going to have a

return of at least inflation to accommodate the money that is needed over the next 75 years to pay for the benefits that have now been promised in those programs. I mean huge amounts of money, an almost inconceivable $73.5 trillion, that we would have to come up with today. But our total Federal budget, back to that pie chart, our total Federal spending only comes to approximately $2.4 trillion in 1 year. So total Federal spending is $2.4 trillion in 1 year.

This is a quick snapshot of the problems with Social Security. A very short-term surplus. What happened with the Greenspan Commission in 1983, they reduced benefits and increased taxes. A huge jump in taxes. So the huge jump in taxes, they figured if that was invested in a proper way, it could accommodate a longer-term solvency. But their expectations did not culminate the way they thought it would. And the fact is that starting in 2017, we simply go into the red from there on out, and that is sort of representing the unfunded liability in that program.

I think it is important to briefly describe how Social Security works. Benefits are highly progressive based on earnings. That means that if you are a lower income, you get 90 percent back. Ninety percent of what your wages were you will get back in Social Security benefits for that every month. So if you had $1,000 coming in for Social Security over a month's period, you would get $900 back in Social Security benefits for that month.

At retirement, all of a worker's wages up to the tax ceiling are indexed to present value using wage inflation. Indexed to present value means that if a job as a farmer, a boot maker, or anything else paid X amount 20 years ago, then that is going to be what you would pay that profession now. As far as wage inflation, that would be what you are given and assumed. So that just because you worked for a low wage 20 years ago, it would be put on the books and added up and calculated to determine benefits based on what that job would be paying today.

The best 35 years of earnings are averaged. The annual benefit of those retiring in 2004 equals 90 percent of the earnings up to $7,344, thirty-two percent of the earnings between the $7,344 and the $44,000 and then 15 percent of the earnings above $44,000.

What I do in my Social Security bill, I add another so-called bend point of 5 percent which has the effect of saving money by reducing the increase in benefits for high-income retirees. And then early retirees receive an adjusted benefit so if you decide to retire at 62 or 63, it is going to be less than if you decide to retire at 65 or 66 or 67.

I put this on because so many people in the maybe 250 speeches I have given on Social Security complain about somebody abusing Social Security with supplemental security income. And so I wanted to put this on my chart that SSI does not come out of the Social Security, it comes out of the general fund even though it is administered by the Social Security Administration.

We do a lot of talk about this word privatizing. Privatizing is a negative word. I, nor any other Member of this body or the Senate, has done anything except have a percentage of your wages go into a fund that is dedicated to your name. So government still controls it. What you invest in is limited to safe funds, so you do not have the option of saying, well, gee, this sounds like a really good deal so I'm going to invest in this new energy substitute. In my legislation, we limit investments to index bonds, index stocks, index cap funds.

It is interesting that when Franklin Roosevelt created the Social Security program over six decades ago, he wanted it to feature a private sector component to build retirement income. Actually when the Senate passed their Social Security bill in 1933, the Senate said these savings accounts are actually going to be owned by the worker but they can't take any money out till they retire. The House, and again this was after the Great Depression, said, well, we better have government handle all of these Social Security funds coming in and not really have any of the Social Security benefits in an individual's name. When they went to conference, the House won out and we have the program that we have today with the government taking all the money and if there is any surplus coming in from the FICA tax, from the payroll tax, then what Congress and the White House does is spend that surplus on other government programs. So for a start, let us get some real return on that extra investment from the surpluses coming in and let us not simply use it up by spending it on other programs. That is part, I think, of every bill that I have seen introduced.

The system is stretched to its limits. Seventy-eight million baby boomers begin retiring in 2008. Social Security spending exceeds tax revenues in 2017. Social Security trust funds go broke in 2037. But it is worse than that, because all the money is spent and there is only IOUs, that government owes this money back. If government follows the pattern that has been traditional for the last 50 years, then every time they have come short of money, they do a combination of reducing benefits and increasing taxes. When you consider that about 78 percent of American workers today pay more in the payroll tax than they do the income tax, I think it should be out of the question because it is significantly reducing the chances that workers can become wealthy if we continue to increase the tax on them like that.

Insolvency is certain. We know how many people there are and when they will retire. We know that people will live longer in retirement. I chaired the Social Security bipartisan task force. The medical futurists came in and predicted that within 25 years, anybody that wanted to live to be 100 years old would have that option and within 30 years with our new medical technology, with nanotechnology and what is happening in our research, anybody that had the money and wanted to live to be 120 years old would have that option. Already companies are coming in and saying we are paying retirees now, we are paying retirement benefits longer than they actually worked for us. You can see the predicament of the life span. That is the demography of the situation that now faces us in a sort of pay-as-you-go program where we depend on existing workers to pay their taxes in that immediately goes out to pay the benefits of existing retirees. As the birthrate goes down and as our medical technology allows people to live longer, it makes that kind of pay-as-you-go program unworkable. And so some changes have to be made. Almost every State now has made a transition from a fixed benefit to a fixed contribution type program. For the long run, we have got to move in that direction. Part of that movement is getting a real return on some of this money that American workers are sending in so that it can be their own individual account. A good persuasion is the fact that the Supreme Court now on two decisions has said that there is no connection between the taxes you pay in for Social Security and your entitlement to benefits. Taxes are just another tax bill, a tax on your payroll, and benefits are simply another benefit program and they are separate and there is no entitlement simply because you pay into Social Security all your life. It seems like that is a good argument, Madam Speaker, that says, look, let's have some of this in our open accounts so that if we die before we are eligible for Social Security it goes into our estate and it passes on to our heirs.

Here is sort of the picture of the demographic problem. In 1940, there were 28 workers paying in their Social Security taxes to accommodate every one retiree. By the year 2000, with people living longer and the birthrate going down, it got down to three people having to pay increased taxes when it is just the three people paying in to accommodate every retiree. Of course, all this time we are increasing our benefits for retirees. By 2025, the estimate is that there is only going to be two people working for every one retiree. Talking to the National Association of Manufacturers and some of the business groups, I have suggested that if they do not help in explaining the problems of Social Security, then we could be facing the kind of situation of being forced to pay higher and higher payroll taxes that would put our businesses at a competitive disadvantage.

Take a guess what the payroll tax equivalent is in France. It is over 50 percent. Over 50 percent of their payroll in France goes to accommodate

their senior programs. Germany just went over 40 percent. No wonder that they are complaining about their competitive disadvantage in terms of trying to compete with the rest of the world. It is so important that we move ahead trying to solve this problem now of insolvency rather than just simply looking the other way and putting it off because it does two things. It puts an extra burden on our kids and our grandkids and future generations. Secondly, it is going to be much more difficult to solve the longer we put off the solution. That is because of the little blip where we have surpluses coming in now and pretty soon we are going to have to reach into other funds to accommodate our promises on benefits.

Economic growth will not fix Social Security. I have heard some people say, actually from the other side of the aisle, look, if we can get a President that creates a strong economy. First of all, a President or this Congress does not create a strong economy. It is our system that we have in this country. It is a wonderful system that we devised back in our Constitution when we structured it so as to encourage hard work and effort.

So we have a Constitution and system in America that those that work hard, that save, that try and invest, that go to school and use that education, end up better off than those that do not.

Now we are sort of floundering a little bit in an ambition of some to divide the wealth, taking from the people that have made it and giving to the people that have not made it. So if a young couple decides, look, we are going to work double shifts so I can have more money and do better for my family, we not only tax them more, but we tax them at a higher rate.

So we have got to be very careful that we do not discourage the kind of policies that have made this country grow better and faster and stronger with a higher standard of living than any other country in the world by continuing to say if you are successful, we are just going to really hit you with larger taxes.

When the economy grows, workers pay more in taxes, but also will earn more in benefits when they retire. Growth makes the numbers look better now, but leaves a larger hole to fill later.

The administration uses some of these figures, and I have met with both President Clinton, who tried to move ahead with Social Security reform, and President Bush, who has tried to move ahead with Social Security reform.

But here is my guess: Whether it is Mr. Kerry or Mr. Bush, I think that it is very important that we move ahead with Social Security reform next year. The first year in a 4-year cycle for the President is the only real opportunity for a President to push for the kind of agreement between Democrats and Republicans that is going to be able to solve the Social Security problem. If there is not bipartisan support for some way to solve the problem, then we are going to be faced with a future of reducing benefits.

Some people have suggested if government would keep their hands off the surplus and not spend it for other government programs, keep their hands off the money in the trust fund, that Social Security would be okay. I have this bar chart to show you the difference between what is needed and how much is in the trust fund.

The trust fund, or the IOUs, where there is no money there, is $1.4 trillion. The unfunded liability, in other words, what is needed to go into a savings account that will earn interest at the rate of inflation, is $12 trillion. So what is in the trust fund is not nearly enough to accommodate a solution for the problem. We have got to pay it back, and we will; but will we borrow money, or increase taxes to come up with that $1.4 trillion to pay back?

The biggest risk is doing nothing at all. Social Security has a total unfunded liability of over $12 trillion. The Social Security trust fund contains nothing but IOUs, and to keep paying promised Social Security benefits, the payroll tax will have to be increased by nearly 50 percent or benefits will have to be cut by 30 percent. A dire prediction, a real problem for seniors 20 years from now and for our kids and our grandkids that are going to have to put up with our overspending and our overpromising.

The real return to Social Security, this chart is supposed to show that Social Security is not a good investment. The real return on Social Security is less than 2 percent for most workers, and shows a negative return for some, compared to the 7 percent that the market has shown us over the last 100 years.

The first chart is minorities. If you are a black male, your average age of death is 62 and you end up with negative return on the money that goes into Social Security. It is interesting that back in 1934, in fact from 1934 up until the start of World War II, the average age of death in America was 62 years old. But benefits, even when we started, you could not draw Social Security benefits until you were 65. So if you die on average at 62, the program worked very well, because most people never collected any benefits.

The average return, again, is 1.7 percent. The tall blue graph on the right shows what the Wilshire 5000 index earned, and that was 11.86 percent after inflation, and that was for the last 10 years, including the last three down years.

This is how long you have got to live after you retire if you are going to break even on Social Security benefits. If you retire in 2005, you are going to have to live 23 years after you retire to break even on Social Security. As you see, in the earlier years, if you happen to retire in 1980, you only have to live 4 years after you retire. That is because you paid much less in in relation to what you are going to take out as we have reduced benefits and increased taxes.

This is the increased taxes. So every time we have gotten into problems we have said, well, let us increase the taxes on workers. In 1940, we raised it from 1 percent to 2 percent of the first $3,000. In 1960 we raised it to 6 percent of the first $4,800. In 1980, we raised it to 10.16 percent of the first $26,000. In 2000, we raised it to 12.4 percent of the first $76,200. In 2004, the rate did not go up, 12.4 percent for Social Security, but the base was increased to $87,900. $89,000 is now the base that we tax the 12.4 percent on for Social Security.

Madam Speaker, 78 percent of working families now pay more in payroll taxes than income taxes.

These are the six principles that I sent to the House and Senate Members suggesting maybe at least we can agree on some of the principles.

One, protect current and future beneficiaries.

Two, allow freedom of choice on whether you want to stay in the existing program or whether you want to go into a program where you would have some of the money dedicated to your own account that you own.

Preserve the safety net. In other words, I do not use all of the trust fund to make the transition into a program that starts putting money in these personal savings accounts.

Make Americans better off, not worse off.

Next I say investing, allowing some of the investment to go into mutual funds, index funds. That is the seed corn for our business and industry to do the research, to make the kind of improvements to increase their efficiency and competitive position within the world trade we are now facing.

Create a fully funded system.

And no tax increases.

Just briefly, I am going to finish up by going through the Social Security bill that I just introduced, and that is a bill that is sponsored by both Republicans and some Democrats. It is scored by the Social Security Administration to keep the program solvent. There is no increases in the retirement age, no changes in the COLA, the cost of living index, depending on inflation, where we increase benefits every year, and that there is no change in the benefits for seniors or near- term seniors. Solvency is achieved through higher returns from worker accounts and slowing the increase in benefits for the higher-income retirees.

The Social Security trust fund continues. Voluntary accounts would start at 2.5 percent of income and would reach 8 percent of income by 2075. So it is a gradual transition into a personal savings account, and it is important we do it gradually.

The other option we are looking at is you could issue bonds and make the

transition to start at a higher rate, such as 5 percent of your income would go into your personal retirement account quicker, but that means in effect borrowing more money to accommodate the transition costs.

Investments would be safe, widely diversified, and investment providers would be subject to government oversight. And the government would supplement the accounts of workers earning less than $35,000 to ensure that they build up significant savings.

This was an idea that President Clinton had that said for the lower incomes, so that low income workers can retire more like millionaires, we need to add a little money, I think President Clinton called it a ``golden savings account.'' But what I do in my legislation is say we are going to assume that everybody can at least have the 2.5 percent to start with, and then it goes up, of $35,000, that goes in their personal retirement savings account to accumulate and to have the magic of compound interest.

And that is what it is all about.

Just as a footnote, Madam Speaker, I am still going to suggest to not depend on some kind of a magic solution. Every person under 50 years old; in fact, every person, should make a very strong, dedicated effort to start putting money aside for your retirement. Start figuring out what you are going to need. If you are going to end up living 40 years after you retire, how much money are you going to have to start putting aside. And the magic of compound interest and those figures, which maybe deserve a whole hour of briefing on encouraging savings, but let me just say that it is so important for everyone, for everybody from the age of 16 to the age of 60, to start setting aside as much as you can now and let the magic of compound interest help with the retirement benefits.

In conclusion, accounts are voluntary, and participants would receive benefits directly from the government along with their accounts. Government benefits would be offset based on the money deposited into their accounts, not on the money earned, and workers could expect to earn more from their account than from traditional Social Security. In fact, what we do in our bill is we guarantee an individual worker that decides that they want to go into the personally-owned account system, and that is optional, that they will get at least as much as they would from the fixed Social Security system that exists today. So we can guarantee that, since they only earn 1.7 percent on Social Security.

If anybody would like to review my charts, then they are on my website. If you go to one of the search engines and you type in ``Congressman Nick Smith,'' you can get to my website. You can get to these charts that display my particular proposal for solving Social Security and, again, this proposal has been scored by the Social Security Administration to keep Social Security solvent. I have gone to the White House. The White House feels very strongly that it is important next year to start working aggressively to get some kind of a compromise between the Democrats and the Republicans in the House and in the Senate to move ahead with a solution for Social Security that is going to make sure that we keep this program solvent for the long run.

Madam Speaker, I move that the House do now adjourn.

The motion was agreed to; accordingly (at 11 o'clock and 33 minutes p.m.), the House adjourned until tomorrow, Wednesday, July 14, 2004, at 10 a.m.

Mr. Speaker, first I feel somewhat obligated to explain that my wife was not in town this week and I had to pick out my own tie.

As we approach more decisions on appropriations, this is the chart that I used on my Social Security presentation. I want to focus on the fact that 14 percent of total Federal spending is interest on the debt. That now amounts to about $300 billion a year. So let us be conscious of the fact of how much we are spending and overspending.

This year we are going to spend about $500 billion more than we are taking in. That is going to add to the debt. Interest rates are going up. We are putting a huge burden on our kids and our grandkids and future generations as this body and the Senate and the White House continue to overspend. Let us be frugal; let us realize that the imposition on our kids and grandkids is not fair and jepordizes their future.

Mr. Speaker, I oppose H.R. 2828, the California Water Bill because it preauthorizes wasteful projects.

It forces federal taxpayers to pick up more than a $1.5 billion tab for a California-only project. It would not prevent taxpayers from getting stuck with the cost for large water projects, and would open the Federal treasury to raids by disingenuous water users. H.R. 2828 would ``preauthorize'' major water projects. A ``yes'' vote on H.R. 2828 would mean Congress gives up its long-standing right to have a say over taxpayer funded projects. Why should the rest of the country pay for California's water problem? They have 35 million taxpayers to pay for it.

Mr. Chairman, this bill, H.R. 3598, will ensure that the Federal agencies will coordinate their programs. That is important. It expands the effort to have more students be trained in the manufacturing science. That is important. It ups the authorization amount for the MEP program.

Yesterday we passed a bill that increased the appropriations for that program, the Manufacturing Extension Program. I will just urge every small and medium-sized manufacturer in this country, everyone that knows somebody that works in that kind of industry, to take advantage of this program.

Look, you are getting expert advice for one-third of what it is otherwise going to cost you as a manufacturer for expert advice. The State provides one-third, the feds under our program provides one- third, that leaves one-third for the participating manufacturers. Use the program.

If you know somebody that is in the manufacturing arena, tell them to go to the Web site. Type in MEP and NIST and let a search engine find it. If you want the details, it is www.MEP.NIST.gov/state-affairs. It is a good program. Use it.

Mr. Speaker, there is going to be a short time for debate this afternoon. I am introducing an amendment today to take $20 million from the U.N. and redirect it to come up to what the President requested for NIST, for research in technology and science.

And I would just suggest to my colleagues, Mr. Speaker, that after the fall of Iraq, information has come to light about the United Nations' Oil for Food program and some of the apparent corruption. Now there is an unwillingness of several countries, including the United Nations itself, to not release the kind of information that is going to help us solve this scandal. The U.N., according to the Wall Street Journal, has kept hundreds of millions of dollars of Oil for Food money that should have gone to the Iraqi people. Now the United States taxpayers are paying that.

I hope my colleagues will support my amendment today.

Mr. Chairman, I offer an amendment.

Mr. Chairman, I do.

Mr. Chairman, will the gentleman yield.

This amendment would take money from the United Nations and would put that $20 million in NIST, the National Institute of Standards and Technology, at a level that was recommended by the President.

I am offering this amendment, taking money from the United Nations appropriations, international organizations and, because I am concerned about the additional money that the United Nations has taken and has in their possession from the Oil-for-Food program.

I think this Congress should be very concerned about what has happened in the Oil-for-Food program. This particular line item appropriation was increased 19.4 percent above last year, even though there are reports that the U.N. kept $100 million of the Oil-for-Food money to pay for its own operating expenses. This money was intended to rebuild Iraq, but instead the American taxpayer is currently paying the tab.

Also, the U.N. collected .8 percent of the Oil-for-Food transactions to pay for weapons inspections, but between 1999 and 2002, the U.N. collected $400 million for weapons inspection, even though no inspections took place.

So that is where the $20 million would come from. It goes to increase the appropriation up to the President's request for the National Institute of Standards and Technology, NIST.

You know, it is a simple amendment that I think is fair, that I would hope would be in order so that this body could consider how far we wanted to go increasing some of the appropriations to the United Nations, again by 19.4 percent at a time when it is reported that they have, in effect, confiscated $400 million for weapons inspections that they did not make; at a time when they have taken another $100 million off according to an article in the Wall Street Journal, to pay for their own administrative expenses.

I think it is reasonable and appropriate that we send a signal to the United Nations that we are not going to have this dramatic 19.4 percent increase in those kind of appropriations, at a time when the United Nations has issued orders apparently to not release the background of the Oil-for-Food program, when countries that were involved in the Oil- for-Food program such as Russia, such as France, such as some of the other countries that now have instructed their people not to release the information so that we can appropriately investigate what happened in the misuse of that Oil-for-Food program funds.

Recently, both my Agriculture and International Relations Committees held hearings on the United Nation's Oil-for-Food (OFF) program scandal. That program taught us a lot about the United Nations' (UN) weaknesses and explain the actions of countries like France and Russia when they worked against us last year.

The UN placed trade sanctions on Iraq after Saddam Hussein invaded Kuwait in 1991. By 1995, the sanctions were widely blamed for a developing humanitarian crisis in Iraq. The United States and Britain realized that Iraq, which has the second largest oil reserves in the world, could trade oil for food and medicine. We pushed for UN Security Council Resolution 986, and the OFF program was created. If effective, it would have reduced the humanitarian impact of the sanctions while preventing Hussein from buying weapons.

Unfortunately, Hussein cheated OFF and the UN didn't stop it. He managed to get his hands on at least $10 billion of OFF money. Other countries were complicit in helping him cheat. France and Russia demanded that we let Hussein design OFF. It allowed Hussein to pick the price for his oil, to pick his customers, and to control the people who audited him. Within a few years, the flawed program allowed Hussein to sell at low prices in exchange for kickbacks that were funneled into Swiss bank accounts. This was suspected at the time, but it was impossible to fix it. Fixing it would have required unanimous support of the Permanent Members of the Security Council, including France and Russia. At the time, these countries said that they wanted to end the sanctions completely. France, Russia, and China all had oil contracts with Iraq that would have been activated, resulting in huge benefits for these countries had the sanctions been removed.

At the same time, UN bureaucrats in Iraq were slow to file reports and bring irregularities to the attention of the Security Council and its oversight committee. Furthermore, Iraq paid its UN auditors. The more trading they allowed, the more money the UN got. These arrangements have only come to light since Saddam Hussein's fall. There are reports that even the UN's head of the Oil-for-Food program, Benon Sevan, was on the take from Hussein.

The United States and Britain have pushed for an audit to find out what happened. Paul Volcker, a former Chairman of the Federal Reserve, is heading a UN investigation. However, the UN is stonewalling. Sevan sent letters ordering UN offices to refuse to cooperate. Russia has asserted that it will not release any documents. And other UN bureaucrats have refused to share papers. I have sponsored legislation that would cut U.S. support for the UN if it doesn't cooperate.

The real story here is that many countries make decisions based solely on what is good for their country, with no regard for the goals and ideals of the UN Charter. Certainly, this calls the Security Council's moral authority into question and degrades its capacity to respond appropriately to events. Is it any wonder that, under pressure from these countries, UN could not agree to support us in Iraq? And is it any wonder that at the first threat of danger, the UN pulled out? We need to carry out a full and thorough investigation and make changes if the United States is to continue with some degree of confidence.

And with that, Mr. Speaker, we can proceed to the point of order. I would hope that inasmuch as this amendment was included in the unanimous consent to be allowed to be considered, that we would allow my amendment to be considered.

Mr. Chairman, I would like to question the ruling of the chair on whether or not the amendment has been passed.

May I have a parliamentary inquiry, Mr. Chairman?

Mr. Chairman, I refer to the unanimous consent request that was made last night asking unanimous consent that during further consideration of this bill, H.R. 4754, that the following amendments be allowed to be offered, and my amendment is included in that list.

Mr. Chairman, I am not questioning the points of order against the amendment. I am questioning the ruling of the Chair that this amendment cannot be offered at this time.

And I guess, Mr. Chairman, reluctantly I will accept the ruling of the Chair.

Amendment No. 20 Offered by Mr. Akin

Mr. Chairman, I offer an amendment.

Mr. Chairman, I yield myself such time as I may consume.

This amendment is offered partially representing my concern that under the UC that was offered last night, this body would not allow the full amendment. However, under that UC this amendment is appropriate, according to the Parliamentarian.

My concern is that this body should express concern, if not outrage, about the actions of the United Nations in the Oil-for-Food program. It should be a heads-up, a reminder, that we cannot ask the United Nations to be responsible for so many things that affect our future.

The particular language of this amendment takes appropriations and dollars from United Nations contributions to international organizations line item. This appropriation is reduced by $20 million. I would call to my colleagues' attention that this appropriation is increased 19.4 percent over last year. Even with this amendment, there is still a 17.4 percent increase.

Recently, both my Committee on Agriculture and Committee on International Relations held hearings on the United Nations Oil-for- Food, the so-called OFF program, scandal. That program taught us a lot about the United Nations' weaknesses and I think explains the actions of countries like France and Russia when they worked against us over the last several years.

The U.N. placed trade sanctions on Iraq after Saddam Hussein invaded Kuwait in 1991. By 1995, the sanctions were widely blamed for the developing humanitarian crisis in Iraq.

The U.S. and Britain realized that Iraq, which has the second largest oil reserves in the world, could trade oil for food and medicine. We pushed the U.N. Security Council Resolution 986, and the so-called Oil- for-Food program was created. If effective, it would have reduced the humanitarian impact of the sanctions while preventing Hussein from buying weapons.

Unfortunately, Hussein cheated the OFF program, and the U.N. did not stop it. He managed to get his hands on at least $10 billion of Oil- for-Food money. Other countries were complicit in helping him cheat. France and Russia demanded that we let Hussein design the OFF, the Oil- for-Food, program. It allowed Hussein to pick the price for his oil, to pick his customers, to control the people who audited him, and within a few years the flawed program allowed Hussein to sell at low prices in exchange for kickbacks that were funneled into Swiss bank accounts.

This was suspected at the time, but it was impossible to fix. Fixing it would have required unanimous support from the permanent members of the Security Council, including France and Russia, and at the time these countries said that they wanted to end the sanctions completely. Of course, France and Russia and China all had oil contracts with Iraq and Hussein that would have been activated, resulting in huge benefits for those countries had the sanctions been removed.

I repeat, this funding for this appropriation that we are trying to reduce by $20 million is from a line item that is increased 19.4 percent over last year, and even with the $20 million reduction still results in a 17.4 percent increase.

The U.N. bureaucrats and what is happening in the U.N. should concern us. There is no question that the U.N. was slow to file reports and bring irregularities to the attention of the Security Council and its oversight committee.

Furthermore, Iraq paid its U.N. auditors. Iraq, Saddam Hussein, was paying the auditors that were supposed to audit them, and the more trading they allowed, the more money the U.N. got.

These arrangements have only come to light since Saddam Hussein's fall. There are reports that even the U.N.'s head of the Oil-for-Food program, Benon Sevan, was on the take from Hussein.

Mr. Chairman, let us not go through this bill of making these kinds of huge appropriations from the United States taxpayers to the U.N. without calling to attention these kinds of discrepancies. The U.S. and Britain have pushed for an audit to find out what happened.

Paul Volcker, a former Chairman of the Federal Reserve, is heading a

Mr. Chairman, will the gentleman yield?

Well, Mr. Chairman, let me just say that this is cut from one of the largest expenditures in the United Nations appropriations, that is, to the contributions to international organizations. I think the American taxpayer in general is not willing to increase this account by 19.4 percent at a time that the gentleman from Virginia admits that the U.N. is doing something that is unconscionable and that should not be acceptable.

When we have other countries that are complicit, apparently, in this graft-type program of oil for food, along with what appears to be a reluctance of the United Nations to cooperate, we need a signal. I would hope this $20 million would be spent for science and research, because I chair the Subcommittee on Research.

May I ask how much time I have remaining, Mr. Chairman.

Mr. Chairman, I yield myself such time as I may consume.

I would ask the ranking member if he does not object to the fact that the United Nations took $400 million of what was intended to be money to pay for inspections at a time when they were not having inspections.

I would ask the ranking member if he is not concerned with a report from the Wall Street Journal that the U.N. took $100 million from the Oil-For-Food Program and used it for operations.

I would be concerned whether the ranking member or any Republican or any Democrat is not concerned with the fact that a United Nations employee who was handling the Oil-For-Food Program, Mr. Sevan, has now written letters, according to Mr. Volcker's staff, suggesting that the information not be released regarding this program.

It is obvious there has been some misuse of money. I would like to suggest that the real story here is that many countries make decisions based on what is good for their country as representatives to the United Nations with no regard for the goals and ideals of the U.N. charter. Certainly this calls the Security Council's moral authority into question and degrades its capacity to respond appropriately to events throughout the world.

Is it any wonder that under pressure from these countries the U.N. could not agree to support us in Iraq? Is it any wonder that at the first threat of danger the U.N. pulled out of Iraq?

It seems to me, Mr. Chairman, that we need to carry out a full and thorough investigation and make changes if the U.S. is to continue with some degree of confidence. And we need to send this signal of this reduction with this kind of testimony regarding a $20 million reduction for the U.N. I think this action sends the beginning of a message that our country and the taxpayers of this country will not stand for this kind of abuse.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself such time as I may consume.

I would just like to ask the previous speaker, the gentleman from Connecticut (Mr. Shays), if he agrees with a 19.4 percent increase in this appropriation line item.

I yield to the gentleman from Connecticut.

Reclaiming my time, Mr. Chairman, I do not think a 19.4 percent increase is justified at a time when the United Nations has instructed its people to withhold information from the Volcker Commission.

I do not think it is justified; and I would say to the chairman, if there was unanimous consent from him and the ranking member, and if there is no objection and it would be appropriate, I would be delighted to amend this amendment to say that this $20 million would be withheld on condition of full cooperation by other countries and by the United Nations.

I yield to the gentleman from Virginia.

Would you support the amendment with that language?

If it says that the $20 million is going to be withheld unless and until there is full cooperation by the United Nations and participating countries releasing available information on the Oil-for-Food program?

Mr. Chairman, I would be glad to change that, too. If there is no objection, I would make that amendment. I would ask for unanimous consent.

I understand that it has to be in writing. Is that correct, Mr. Chairman?

Mr. Chairman, I withdraw it, with the understanding that I could redraft it and bring it to the desk.

Mr. Chairman, I reserve the right to object.

I do, Mr. Chairman, just for an explanation to the body. Originally, we thought we could work out a word change that would be acceptable, but it would still be subject to a unanimous consent request. We were informed there would be an objection, so that is why we vacated the rewording of the amendment.

Mr. Chairman, I withdraw my reservation of objection.

Mr. Chairman, I demand a recorded vote.

Madam Speaker, I ask unanimous consent to proceed with my 5 minute at this time.

Madam Speaker, I rise this evening to honor and remember Rolland ``Bob'' Lyons, who lost his struggle with cancer June 17, 2004.

Bob was born in Ann Arbor, Michigan, and lived in several Michigan cities before graduating from Kalamazoo High School in 1948. He served his country in Korea as a second lieutenant in the Army. A graduate of the University of Michigan, he founded the Michigan Trenching Service, Incorporated, and became a prime contractor for service companies. Although he was a highly successful businessman, he humbly referred to himself as ``just a ditch digger from Ann Arbor.''

Bob Lyons inspired optimism and a community-minded spirit that has left a lasting mark on those who were fortunate enough to have known him. Bob's commitment to improving society can be seen through his membership on the Mackinac Center Board of Directors. However, he will best be remembered, I think, for his boundless energy and commitment to numerous causes: Cleary University, St. Joseph Hospital, the Boy Scouts, the Hands On Museum, and many, many others.

Bob Lyons' humor and outgoing personality made him a natural at fundraisers and political events where he was a regular. He recruited, encouraged, supported and helped elect many political candidates.

Bob was passionate for his causes and was a role model for all of us who seek to improve our communities and our country. Thank you, Bob, for all you did for us. You will be remembered fondly. We offer our condolences to your beloved wife Jan, daughter Suezahn, son Rob. Bob, your service to your community and your country will be remembered.

Mr. Speaker, I was going to make some comments about overspending and overpromising and the imposition that puts on our kids and grandkids. But just following up on the U.N., I am very concerned about the U.N. and how much that the U.N., as a tool, can accommodate some of our goals in the United States; and I am particularly concerned when some Members have suggested that the U.N. should come in and monitor our presidential elections.

What comes to mind is the fiasco of the Oil for Food program. The U.N. bureaucrats in Iraq did not file reports and bring irregularities to the attention of the Security Council countries that had a particular vested interest, allowing corruption to take place in the Oil for Food program.

I am very concerned, the people of the United States should be concerned, how it works, and the fact that a lot of the individual ambassadors in the United Nations are looking out for nothing except what is in the best interest of their particular country, not what is good for the humanitarian, economic or security efforts of the whole world.

Mr. Speaker, it should concern everyone who has followed technological developments, especially in recent years, to see the United States is falling behind. It has been said a couple of times that Japan's Earth Simulator Computer is now faster and more efficient than anything in the United States.

I congratulate the gentlewoman from Illinois (Mrs. Biggert) for her initiative in sponsoring and moving this legislation through the legislative process. Let it be said that everyone agrees that over the last 30 years invention and innovation have been among the greatest driving forces behind the tremendous technological advances that we have had and the ability of the United States to develop high-quality products and the way to produce those products that can be competitive in a world market.

I think at the forefront of our innovation has been the development of these supercomputers. They have allowed us to make new discoveries, design new technologies, and develop new products more quickly and at much lower cost than we would have thought imaginable even 10 years ago.

As chairman of the Subcommittee on Research for the last several years, I have been proud to support our Nation's efforts in these and other important scientific endeavors, and I have been especially interested and strongly supportive of continuous investment, financial and otherwise, of all stages of our tech advancement, from the initial investigation of new concepts down to technology demonstrations and products.

What has also been made clear in recent years is that government alone cannot and probably should not be the sole contributor to America's scientific endeavors. Continuous investment is needed in all contributing sectors of society, certainly from universities to national laboratories to private sector corporations to vendors. That falls back on a goal that we must also have in this country, and that is capable scientists that are going to make invention and innovation happen.

I would just like to bring to my colleagues' attention what a high- tech supercomputer is. According to an April 2003 report, IBM is now looking to develop, in conjunction with Lawrence Berkeley National Laboratory and the Argonne National Laboratory, a system that will perform at twice the level of the Earth Simulator, hopefully by 2005.

In addition, the Department of Energy has contracted with IBM to develop two systems, the ASCI Purple and Blue Gene program that together, listen to this, will be able to perform 460 trillion calculations per second. The Earth Simulator's peak capacity is 40 trillion operations per second. So we are moving ahead, and this legislation is going to help assure that we move ahead, that the United States stay in control.

This is important legislation that will not only help our Nation remain competitive with countries such as Japan, but will help the United States to maintain its leadership in tech advancement. So, again, I thank our Committee on Science chairman and ranking member, and I thank the gentlewoman from Illinois (Mrs. Biggert).

Mr. Chairman, I move to strike the requisite number of words.

I yield to the gentleman from Illinois.

Mr. Chairman, reclaiming my time, although I support the intention of the chairman of the Committee on Small Business, my concern would be where the money comes from. So, in the MEP program, it is already sacrificing, and this also takes funds out of that. So I do not know how to rebalance.

Well, Mr. Chairman, this takes funds out of the Justice Department, and that is part of the sourcing of funds that I understand the money would come from. And I will be happy to yield for a final word from the chairman.

Mr. Chairman, reclaiming my time once again, let me ask a question of the chairman. Where is this $60 million of the funds coming from in Justice?

I yield to the gentleman from Virginia.

Mr. Speaker, you know, we are certainly in the campaign season of an election year; and I think everybody, Mr. Speaker, needs to be on guard for the talent to spin. And I am reminded of a cartoon that was in our paper recently. And there were four figures, and the first figure said, ``Gas prices are going up.'' And the next figure says, ``Yeah. That is President Bush trying to give his friends in the oil industry more income and more money.'' And the next figure said, ``Well, look, gas prices are coming down.'' And the next figure says, ``Yeah. That is President Bush trying to buy our votes.''

So I just challenge, Mr. Speaker, everybody in America to brace themselves probably for the most television ads they are going to see ever in this election. And you know what is encouraging is people in this country have a lot of what I call common sense that sort of comes from the gut. So I suggest to everybody, size up the candidates. Do what is right for our future.

You know, some people down here suggest that the way to have a balanced budget is to increase taxes. Some people suggest the way to balance the budget is to reduce spending. Whatever it is, I think we need to be very cognizant of what we are doing to future generations with overspending.

This year, even with the job growth and the expanded economy that is going to result in an estimated $100 billion less overspending, less deficit spending than was earlier predicted, we are still leaving a huge mortgage to our children and our grandchildren. I want to talk about just two issues in that regard as we face the next several weeks of deciding how much we are going to spend in the appropriation bills, in the overspending and what it does to our kids, right now.

And interest rates of course just went up a quarter of a percent last week. It looks like before the end of the year they are going to go up again a little bit. Fourteen percent of total Federal spending now goes towards servicing the debt. So here is 14 percent of the $2.3 trillion that is being spent this year being spent to pay interest on what we are borrowing to accommodate the overzealousness of this body, the Senate, and the White House for the last 25 years to spend more and more money, trying to solve more and more problems.

That 14 percent of the total spending represents approximately $300 billion a year; and if you realize that interest rates are going up and at the same time we are increasing the deficit, that means increasing the debt, that means increasing the interest that we are going to have to pay on that debt, it just leaves our kids with a huge responsibility, to the extent that their standard of living is going to be less than ours if we continue to do what we have been doing, and that is overspending.

And I suggest increasing taxes is not the right way to accommodate that overspending. Right now businesses are charged 18 percent more than the industrial countries that we compete with.

They pay 18 percent more in taxes in this country than other countries. So to simply say we are going to increase the taxes and put our businesses at a greater competitive disadvantage means that there is a greater likelihood that other countries are going to undersell us, that are going to produce those products. It means that companies in this country, to survive, are going to do more of their business overseas. Let us not solve our problems by increasing taxes.

Let me finish, Mr. Speaker, by talking about overpromising. It is easy for a politician to go back home to their districts or their States and say, well, you have some problems; I am going to come back in Congress, and we are going to push to solve that problem simply by increasing taxes to accommodate you, or maybe not even increasing taxes; maybe just making propositions.

The economists use the words ``unfunded liabilities'' to describe how much we have promised over and above the revenues coming in to pay for those promises. I would ask people to guess how much unfunded liabilities are now projected by the Medicare and Social Security actuaries. The answer is $73.5 trillion. That means that we would have to have $73.5 trillion into a savings account, earning as much interest to accommodate inflation, to pay for what is not coming in in the payroll tax in future years. It is not fair. It is moving away from the principle of those that work hard, that try, that study and invest end up better off than those that do not.

I would suggest, Mr. Speaker, in closing, that it is important in this election year that the people of America size up their candidates.