Floor Statements

Mr. Chairman, I offer an amendment in the nature of a substitute.

Mr. Chairman, I yield 5\1/2\ minutes to myself.

Mr. Chairman, I would like to begin by commending the gentleman from Iowa (Chairman Nussle) for the outstanding work the gentleman has done. The gentleman has worked very hard. Our committee has worked very hard, and the budget is a good budget. But I believe the alternative budget that I am going to describe right now and that the Republican Study Committee is putting forward is a better budget. I want to go over the highlights of the differences and engage in this discussion about the alternatives.

Let us look at the major differences. The big difference between the Republican Study Committee budget and the committee budget are three.

First, we provide more tax relief. We provide more tax relief than the committee budget does, we provide more tax relief than any of the alternative budgets do.

Number two, we actually cut some spending. Now the committee's budget cuts the rate of growth of spending. Our budget actually cuts nondefense, not homeland security discretionary spending.

The third thing is we run smaller deficits and we get back to a balanced budget faster than any other budget, including faster than the Blue Dog budget that we just heard a lot of discussion about. We do it in 4 years, faster than any other, and that is not accounting for the faster economic growth that would result from our budget package. Let me run through these three areas.

First on the tax front, we recognize in this budget that we are still overtaxed. The fact is that Federal taxes consume about 21 percent of national income, and total taxes from all government in our country is over a third of national income. This is well above the post-war average high. The fact is we are not undertaxed; we are still overtaxed. Many of our constituents are facing tax increases at the State and local levels. They need to have that off-set, and we can do that in our budget.

Our budget accommodates the President's entire growth package; and that is critical because we need to get this economy growing again, so we accommodate the elimination of the double taxation of dividends. This would end a great inequity in our tax system, a bias in our current code, a bias that, frankly, falls disproportionately on older Americans; and it would also stimulate economic growth.

If we follow the wisdom of the President's proposal and eliminate the double taxation on dividends, it has a number of positive effects for our economy. It would immediately result in higher equity prices, which is a good start. The current tax also increases the cost of capital. By lowering the cost of capital, we encourage capital formation. It also would reduce the current distortion of the allocation of capital. Abolishing the double taxation will over time release billions of dollars for more productive investment.

The bottom line is the President's proposal encourages saving and investment and capital formation, and that helps sustain economic growth. That is why we need to do it.

We also need to accelerate the phase-in of marginal tax rate reductions. When you lower marginal income tax rates, you increase the incentive to save and work and invest, and when you increase the incentives, you get more savings and work and investment. If we delay this any further, we just postpone the beneficial effects.

In our budget, we accommodate the President's entire tax relief package. Then we do something more. We do not specify exactly what that would have to be, but, Mr. Chairman, it would be large enough to accommodate a 50 percent reduction in capital gains rates, and that would also significantly encourage economic growth. That kind of capital formation is a precondition for strong economic growth.

On the spending side, as I said earlier, ours is the only budget that makes some real cuts in spending. On the discretionary side, we do not cut defense spending. We use the same number that the President has proposed and the same number that the committee has proposed. We recognize this obligation. We recognize that we are at war. We do not cut homeland security funding. On the mandatory spending side, we do not touch Social Security at all, we make no changes, and we do not actually cut anything in mandatory spending, although we do restrain the rate of growth. What we actually do cut is in nondefense, nonhomeland security discretionary spending.

Why is it important to get this spending under control? Because, Mr. Chairman, total government spending is the real measure of the burden that the government imposes on our economy. More than deficits, more than the debt, it is the total amount of money that the government sucks out of the private sector, whether it does it by borrowing or whether it does it by confiscating people's money, that is the measure of the misallocation of capital. We all know there are a lot of vital programs that have to be funded, but on the margin we know that this spending occurs through a political process where Members are spending money to try to get reelected. It is not the allocation of capital that individual consumers and businesses would allocate for stronger economic growth.

The other problem with too much spending is the enormous waste. We have heard a discussion about that earlier, but the government cannot even account for over $17 billion in spending in 2001. The Federal Government acknowledges $20 billion in overpayments. The list of ridiculous misspent money, missing money, overpayments is a very long and a very embarrassing list, frankly. We are never going to wring that waste out of government until we impose some spending discipline.

The fact is government Federal spending, discretionary spending, total spending has been growing at several times the rate of inflation, and now is the time to rein that in. If we cannot rein that in now, Mr. Chairman, when can we rein that in?

The net budgetary effects of our budget is greater tax relief, modest spending discipline, and as a result we run smaller deficits for shorter periods of time, and we get back to a balance faster than any other budget proposal.

I heard the Blue Dogs come down on this floor and talk about how much they want to balance this budget, how quickly they want to do that, why they want to do that. I am glad to hear that. I look forward to their voting for our budget because it gets to a balance faster than any others.

The other point I would make is that there can be no doubt that our combination of lower taxes and less spending would lead to stronger economic growth.

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

Mr. Chairman, I yield 3 minutes to the gentlewoman from North Carolina (Mrs. Myrick).

Mr. Chairman, I yield myself 30 seconds to respond and correct what I think was a misstatement.

The fact is the cuts in spending in our Republican Study Committee budget did not result in larger deficits. They result in smaller deficits because we have got less spending, and that means less debt, and that means we get back into balance faster than any other budget that will be considered today; and I am looking forward to the enthusiastic support of the Blue Dogs, who feel very strongly about getting back into balance.

Mr. Chairman, I yield 3 minutes to the gentleman from Arizona (Mr. Flake).

Mr. Chairman, I yield myself 30 seconds to respond to the previous speaker, just to observe that under the budget that we are proposing, the Republican Study Committee, and under the President's tax plan, a family of four making $35,000 a year would pay nothing in federal income taxes. Zero. In fact, the top 50 percent of wage earners in America pay 96 percent of all Federal income taxes. When you lower taxes, it is just hard not to lower the taxes on the people who are actually paying the taxes.

Mr. Chairman, I yield 3 minutes to the gentleman from Texas (Mr. Sam Johnson).

(Mr. SAM JOHNSON of Texas asked and was given permission to revise and extend his remarks.)

Mr. Chairman, before yielding to the gentleman from New Jersey, I yield myself such time as I may consume to observe that although our budget grows spending every year, total spending grows, it grows at a slower rate than the alternative budgets, and that is why we are able to get back to balance faster than any other budgets, and why I look forward to the Blue Dog support, and that is why the Americans for Tax Reform and Citizens Against Government Waste have endorsed the Republican Study Committee budget.

Mr. Chairman, I yield 2 minutes to the gentleman from New Jersey (Mr. Garrett).

Mr. Chairman, I yield 2 minutes to the gentlewoman from Colorado (Mrs. Musgrave).

Mr. Chairman, I yield myself 15 seconds to respond to the creative and very amusing account from my good friend who just spoke about this. However, I would remind him that if he is very concerned about the size of the deficit and the magnitude of the debt, then he will vote for the RSC budget, the Toomey budget, because that is the one that gets us back to balance quickest; that is the one with the smallest deficits and the least debt.

Mr. Chairman, I yield 2 minutes to the gentleman from Texas (Mr. Brady).

Mr. Chairman, I yield myself 15 seconds to respond to the gentleman from North Carolina by observing that the Democrat substitute has more spending, has higher taxes, and it has larger deficits for longer than the substitute that we are debating at this point.

Mr. Chairman, I apologize to the gentleman from South Carolina. That was the one mistake I just made.

Mr. Chairman, I yield 2 minutes to the gentleman from Missouri (Mr. Akin).

Mr. Chairman, I yield 2 minutes to the gentleman from Texas (Mr. Hensarling).

Mr. Chairman, I yield 3 minutes to the gentleman from Arizona (Mr. Shadegg).

Mr. Chairman, I yield myself the balance of my time.

I would just make the following observation, Mr. Chairman. Most of us on both sides of the aisle talk a pretty good game about fiscal discipline. Here is the opportunity to walk the walk.

This substitute budget slows down the growth rate of government spending. It has more in tax cuts to get this economy growing again. It reaches a balance faster than any other budget that is considered today on the floor. It does so within 4 years. It is endorsed by Americans for Tax Reform and Citizens Against Government Waste.

For any of our colleagues who are serious about getting our deficit under control, I urge a ``yes'' vote on this substitute.

Mr. Chairman, I demand a recorded vote.

Mr. Chairman, I offer an amendment.

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

I want to discuss briefly the derivative transactions which this amendment addresses. I should point out that with the possible exceptions of mutual funds, derivatives contracts, including over-the- counter derivatives, are perhaps the most important, creative and innovative development in finance in the last 30 years. Derivatives are financial contracts used by parties wishing to hedge the risk of fluctuations in the value of some commodity, often a financial commodity such as interest rates.

I yield to the gentleman from Wisconsin.

Mr. Chairman, I yield back the balance of my time.

Mr. Speaker, I rise in strong support for this rule, and as a cosponsor and strong supporter of H.R. 534, and I urge my colleagues to vote against the substitute amendment.

As the President stated just a few weeks ago, ``Because no human life should be started or ended as the object of an experiment, I ask you to set a high standard for humanity, and pass a law against all human cloning.''

I am certainly very sympathetic to all those who suffer from incurable or chronic afflictions, and we are all committed to helping find cures. I understand the good intentions of those who advocate human cloning in the hope that research on these clones might yield cures for major illnesses. But for a variety of reasons, both technical and ethical, I believe it is wrong to pursue this approach.

On the technical level, the evidence suggests that cloned human embryos are not likely to yield cures for major illnesses. Hopes to the contrary are just not well founded and they provide false hopes for the afflicted.

Supporters of human cloning for research purposes have proposed limitations which they claim will prevent a cloned baby from being born, but they

would allow cloned embryos to develop indefinitely, as long as they are outside of a woman's womb. Where will this end?

The process of transferring a somatic cell nucleus into an enucleated egg produces a human embryo that has the potential to be implanted in utero and developed to term. In others words, the embryo produced for the purpose of therapeutic cloning, as some call it, is biologically indistinguishable from an embryo intended for reproduction. It is a human life, at a very early stage of development, of course, but entirely human nevertheless. Thus, creating cloned human embryos for research purposes means creating human life for the purpose of research and with the intent of destroying it.

This commodification and exploitation strikes me as a profound undermining of our society's sense of human dignity, and in doing so, it undermines our very humanity.

Again, I urge a vote in favor of the rule, against the substitute amendment, and in favor of H.R. 534.

Mr. Speaker, today I rise to offer congratulations and thanks to Mr. Richard Biolsi, Chief Operating Officer of KidsPeace, one of America's most comprehensive children's mental health charities which is headquartered in the Lehigh Valley in Pennsylvania.

Rich is retiring this year after 34 years of dedicated service to America's youth. Over that span, Rich has served as a social worker, Vice President for Programs, Executive Vice-President for Programs, interim Chief Executive Officer, and Chief Operating Officer for KidsPeace.

When he began his career with KidsPeace in 1969, the fledgling service organization was caring for only 35 children in a run-down home with very few resources. Now, 34 years later, KidsPeace directly cares for nearly 3,000 children at more than 50 centers across the country. What once was a single-home orphanage for children in the Lehigh Valley has become one of the most comprehensive children's mental health charities in the nation that has helped millions of children in every state of our nation, on overseas military bases, and in 70 foreign countries.

Many of these accomplishments, in no small part, can be attributed to Rich's efforts and strategic organizational leadership. From the development of six major residential campuses in four states, the establishment of the KidsPeace Hospital, and the creation of a unique and effective foster care program that provides homes for children in crisis in nine states, Rich has been an integral component of KidsPeace's success.

Rich's accomplishments extend well beyond the borders of KidsPeace. In 2001, he was named Social Worker of the Year by the National Association of Social Workers. KidsPeace estimates that during his distinguished career, Rich and the programs he has created and overseen have directly cared for nearly 80,000 children in emotional crisis.

So today, Mr. Speaker, I rise to recognize the outstanding dedication of Mr. Richard Biolsi to America's most vulnerable children. His commitment to excellence has enriched the lives of each of the children he cared for. I offer congratulations on his outstanding career, and the thanks of a grateful nation.