Mr. President, will the Senator yield for a question on that chart? As I understand it, the President's budget, and this budget resolution, do not provide anything for the long-term costs of Iraq, Afghanistan, and the continuing war on…
Mr. President, will the Senator yield for a question on that chart?
As I understand it, the President's budget, and this budget resolution, do not provide anything for the long-term costs of Iraq, Afghanistan, and the continuing war on terror?
So the budget is not really presenting a true picture of what we can anticipate in terms of expenditures; is that correct?
Are there other items they have left out besides the costs of Iraq and Afghanistan?
What would the deficits be if all of these things are included?
Would the Senator yield for a question?
When did the President make that statement?
Grievously wrong. I gather we will probably see the true picture of what has happened over the succeeding 4 years, but we continue to run these deficits and we are getting deeper into debt all the time. Is that not correct?
Would the Senator yield for a question?
If the debt keeps running up, then the carrying charge on the debt goes up every year. So more and more of the annual budget is consumed in order to pay the interest charge on the debt that was built up because deficits have been run before, is that correct?
Mr. President, that is the question I wanted to put to my colleague.
As I understand what is happening, we are becoming increasingly dependent economically on countries abroad. We are losing control over our own economic destiny.
They say, well, they are still willing to lend us this money. That may be, but in the course of doing it, we become more and more dependent upon them. They can continue to give us the money, we get deeper and deeper into the hole, which then raises the prospect that if they shift their policy, we can take a very serious hit. There is no commentator I have read who believes we can continue on this path indefinitely. At some time there will be a reckoning.
What has happened is the United States has become dependent on the kindness of strangers. We say we are No. 1, that we have the world's strongest economy. Yet we are in hock to everyone around the world.
The Senator showed the figures of the holdings of other countries. The China figures, which are still well short of Japan, are going up on an ascending trend that is almost breathtaking in terms of how much deeper we get into hock.
I ask the Senator, not only does that have serious economic implications, but doesn't it also reduce our ability to deal on important political and security issues when we are this indebted and this dependent on others in economic terms? They are in a position to give a real jolt to our economy if they choose to do so, which then, it seems to me, restricts our ability to deal on a whole range of other issues we may have with one or another of these countries.
Will the ranking member yield on that point?
Would the Senator agree with me that is an outrageous departure from the traditional practice in terms of how conference committees ought to operate? Traditionally, conference committees have met, both parties have been included in the conference committee, debate has taken place, issues have been raised, and decisions made. The majority may be able to impose their decisions because that is how it gets decided, but there is an opportunity to try to shape the debate and have an influence on what is decided.
In this instance, the Democratic members of the conference committee were completely excluded, except for one show-and-tell meeting that was held, a pro forma meeting.
Yes. Which had to be done; otherwise, presumably, it never would have happened. All these decisions were made by--and only by--the Republican members of the conference committee from the House and the Senate.
Now, it is an abuse of power, in my opinion. It is another reflection of an arrogance of power in terms of how the institution ought to operate. I think it is very important to register the point that this is what transpired. The American people need to understand that this budget resolution was not the consequence of a give-and-take in the normal legislative way. This was done by the majority simply imposing their will.
Will the Senator yield for a question?
As this wall of debt is built up, I want to come back again to the carrying cost on that debt. It has to be understood, in each annual budget, there is going to be a larger and larger amount to cover the interest charge on this expanding debt that is being built up year to year. Furthermore, if we run a risk that other countries are not going to want to hold our paper, as they are doing, we are probably going to have to raise our interest rates. In fact, interest rates are already on the way up, in any event. If you have to raise them even more, to get others to continue to hold our paper, the carrying charge is going to go up.
So the carrying charge is going to go up because the debt is going up, and it is also going to go up because the interest rates will be going up. So there will be a double blow dealt to the American economy, and a bigger and bigger chunk of each year's budget will be eaten up in paying the interest charges on this enormous debt. Isn't that correct?
Will the Senator yield?
The number of people in this country who earn over $200,000 a year is less than 1 percent of all taxpayers, is it not?
It is a tiny group. So this tiny group under this chart will be receiving the overwhelming proportion of this tax cut that is included in this budget resolution.
Will the Senator yield for a question?
Is the $32 billion--the cost of the tax cut that goes to those making over a million dollars, is that just for 1 year?
So, presumably, in the following year it will cost another $32 billion?
That gives you a clear picture of what the priorities are in this budget. The priorities are to give $32 billion in tax cuts to millionaires, and yet to cut the education programs to almost below what they were in 2005; is that correct?
Mr. President, will the Senator yield for a final question?
The Senator has spoken in a very articulate way about fiscal responsibility. My own understanding is, looking back at history, when we have gone to war, as the President took us to war in Iraq, we have usually raised taxes to help cover the cost of the war or at least cover part of the cost of the war in an effort to be fiscally responsible.
In this administration, we went to war and, if I am not mistaken, at the same time the administration was pushing for tax cuts. So we were again being hit doubly. The cost of the war was being imposed on the budget affecting our deficit and debt situation, and at the same time they were seeking tax cuts--in other words, diminishing revenues--which also affected negatively our deficit and debt situation, and that is contrary to fiscal responsibility and contrary to what has happened in previous war engagements; is that not correct?
Would the Senator yield the floor?
Wasn't the money in order not to do this to education contained in the Senator's amendment coming from closing corporate tax loopholes that had previously been passed by an overwhelming majority in this Senate?
Isn't it a dramatic demonstration of a choice in priorities, that rather than choosing to fund education, to give young people these opportunities which have been paid for, what they now say is, we had to cut the programs because we have a deficit problem?
The very able Senator from Massachusetts took that into consideration when he proposed his amendment because he wasn't going to add to the deficit. He was going to cover the costs of the amendment by closing these egregious loopholes in corporate taxes. They came along and cut the education programs and allowed the egregious tax loopholes to continue. It is a dramatic demonstration of the priorities of this Republican budget.
Absolutely. And the Senator from Massachusetts has been sounding this clarion call. I make reference to the chart the Senator showed earlier, which shows what is happening in terms of our young people going into math and science and engineering as a percent of the 24-year-olds who could go into those fields to develop that kind of competence which we need in the so-called global economy.
Now, as I understand this chart, in 1975, the United States was third in the world, as shown over on the left side of the chart; is that correct?
In 1975, we were third in the world; is that correct?
We are talking now about math, science, and engineering. Everyone talks about technology, the competition we are engaged in, and so forth. How do you compete in that world if you do not train the people and have the professionals with the skills to do it? We went from being third in the world as to the percentage of our young people going into math, science, and engineering, to where now, as of the year 2000, we are 15th in the world, as I read over on the right side of that chart.
We have slipped all the way back; there are 14 countries ahead of us worldwide in terms of the people they are putting into math, science, and engineering.
Will the Senator yield on that point?
I want to make sure I understand the Senator on this very point. As I understand it, the tax loopholes, or at least some of the tax loopholes the Senator was closing in order to be able to fund education, were incentives or inducements in the Tax Code to encourage American corporations to move their investment and operations out of the United States and send them overseas. Is that correct?
Mr. President, I commend my very able colleague from
Massachusetts for a very powerful statement about the priorities in this budget. He is absolutely right.
The budget resolution is the single most important document we deal with in the Congress because it contains within it thousands of decisions that are critical to our national life, all of which reflect our choices about priorities.
As the Senator pointed out, this budget resolution makes it a priority to keep tax loopholes for large corporations, many of which induce them to send jobs overseas, rather than closing those loopholes--which have been overwhelmingly supported by the Senate, both Republicans and Democrats--in order to fund education. It is a clear example of the wrong set of priorities. I thank the Senator, first for his leadership in the Senate which got that amendment adopted, which would have done something for education in this country, and for articulating so well what is at stake here as we move ahead.
The budget presents very fundamental questions to us. What do we establish as priorities? Which programs are important? How do we balance programs with tax cuts, with deficit reduction? In my view, this budget does not reflect the right answers. It contains substantial cuts in a number of important domestic programs, including Medicaid, education, affordable housing--the list goes on and on.
The justification for these cuts is that we have a deficit problem to deal with. If you ask, why are you cutting these programs which we so desperately need, the answer that is given is: Well, we have a big deficit.
But the question that needs to be asked and understood is: Where did this deficit come from to begin with? When President Bush came into office in 2001, he inherited a surplus in the Federal budget. The projection was that we would run a $5.6 trillion surplus over the next 10-year period. Those were the projections.
In his first budget proposal, which included, in my view, an excessive tax cut, primarily for those at the top of the income scale, he said: We can proceed with tax relief without fear of budget deficits. That is what the President said: We can proceed with tax relief without fear of budget deficits.
The following year, with the budget already in deficit, having moved from surplus to deficit, the President advocated for another tax cut while promising, and I quote him:
Our budget will run a deficit that will be small and short-
term.
In fact, the President's budget that year stated that deficits would be so short-term that by today, by now, the Government would be back in surplus. How wrong he was.
Instead of the $5.6 trillion 10-year surplus projected when the President took office, the projections now are for a deficit over the same period of $3.7 trillion. When you factor in, as my able colleague from North Dakota stated earlier in the debate, some of the costs we know are coming, such as the continuing cost of the war in Iraq, the cost of reforming the alternative minimum tax, the cost of some of the President's proposals to make tax cuts permanent, that is a deterioration in our fiscal position of over $9 trillion.
There are a number of reasons for this fiscal reversal. Spending to recover from the attacks of September 11, to pay for operations in Iraq and Afghanistan have played a part. But the deficits are not primarily the result of increased spending by the Congress. By far the greatest factor contributing to the return of deficits and these disastrous projections is on the revenue side, and the primary reason on the revenue side is the President's tax cuts.
We are now living with the consequence of those tax cuts: deficits and debt as far as the eye can see. The architects of this budget claim that to deal with these deficits, we must have serious cuts in domestic programs. At the same time these serious cuts in education, health care, and housing are being made, this budget resolution contains billions of dollars in additional tax cuts for the wealthiest Americans. In fact, as my able colleague from North Dakota, Senator Conrad, pointed out, in 2006 alone, the President's tax cuts are scheduled to give $32 billion to those making over $1 million a year. So for millionaires, there is going to be $32 billion in tax cuts in 2006.
The New York Times, in an editorial earlier this week, recognized that this budget is skewed toward the wealthy. Let me quote from that editorial:
Congress is likely to approve a budget blueprint this week
that manages to be profligate and mean-spirited at the same
time. . . . It calls for generous tax cuts for investors, who
hardly need more help, and for harsh spending cuts for the
needy, who certainly do.
The Times hoped there would be pressure on the drafters of this budget sufficient to ``inject some common sense and human kindness into the process.''
Regrettably, that appears to have been a vain hope. This budget resolution contains $70 billion in tax cuts that are given fast-track procedural protection at the same time there are very deep cuts in a number of domestic programs.
There are those who seek to defend the spending cuts by saying that they are necessary in order to rein in the deficit. I want to say to them that these cuts are not about reducing the deficit; these cuts are about making room for tax breaks for wealthy people.
As the Washington Post reported, ``the cost of those tax cut extensions would more than nullify the savings from the spending cuts.'' Let me repeat that. ``The cost of those tax cut extensions would more than nullify the savings from the spending cuts.''
There are Medicaid cuts--so important to providing health care for our people--and education cuts, which set us back in the effort to fund our schools and undertake educational initiatives, which may well be the best investment America can make in its future strength.
We are failing to face up to the global competition in which we find ourselves, and we are making choices in this budget that are directly contrary to strengthening our economy and strengthening our Nation. Make no mistake about it, the argument that is made that we must cut these programs that are so essential to our people in order to address the deficit misses entirely the point that room is being made in this budget for further tax cuts for very wealthy people.
So the choice of priorities is the tax cuts on the one hand--more tax cuts, excessive tax cuts, for the very top of the income scale on the one hand--and cutting back on education and health care, the environment, and housing. As the Post pointed out and I quoted, the cost of those tax cut extensions would more than nullify the savings from the spending cuts.
These are the wrong priorities, the wrong choices. I urge my colleagues to vote against this disastrous budget resolution.
I yield the floor.