Deficit Reduction Act Of 2005--Conference Report
Mr. President, I understand the ranking member was going to yield me 30 minutes of time. Mr. President, last week this story, ``Prayers Made to Protest Budget Cuts,'' appeared in the Quad-City Times in my State of Iowa. Ollie Finn of…
Mr. President, I understand the ranking member was going to yield me 30 minutes of time.
Mr. President, last week this story, ``Prayers Made to Protest Budget Cuts,'' appeared in the Quad-City Times in my State of Iowa. Ollie Finn of Bettendorf said:
We're concerned about the budget cuts and that's why we're
having the prayer vigil. We wanted to bring awareness to the
community about how horrible these budget cuts are. . . .
The Rev. Roger Butts, pastor of the Unitarian Church of
Davenport, asked people to determine whether the Fiscal Year
2006 budget serves the common good. ``I've come simply to
pray with you and to stand with you for those whose voices
are easy to ignore,'' he said.
I ask unanimous consent that this article from the Quad-City Times be printed in the Record.
Mr. President, I know that people of faith held many events in Iowa, Washington, and many other places around the country last week on this very topic. Unfortunately, their prayers were not enough. Their prayers were not enough because yesterday we awakened to the flurry of late-night activities in the House of Representatives. House Republicans waited until the middle of the night Sunday, less than a week before Christmas, to order deep cuts to health care initiatives and farm programs and to sneak through blanket protections for the pharmaceutical industry.
It is not an accident these House votes occurred in the dead of night. There are now only 5 days until Christmas. Throughout much of the world, it is the season of giving, but here in Congress, it is the season of taking away--taking away education programs, taking away job training, taking away health care from low-income families, taking away money for needed medical research, taking away from farmers and rural communities and, worst of all, taking away hope from so many. This is a cruel holiday surprise for many American families.
Why are we doing this? Not for deficit reduction, but to provide tens of billions of dollars in tax giveaways for the wealthiest in our society. Forty percent of the benefits in the House tax bill go to those making more than $1 million a year.
Seventy-eight percent go to those making over $100,000 a year. Only 8 percent go to those making under $50,000 a year. So, again, those in the bottom of the ladder get some crumbs from the table. So while the wealthiest in our society unwrap Christmas presents, while the wealthiest in our society are hanging their Christmas stockings and getting thousands of dollars of tax giveaways stuffed in their stockings, for the poor and low income, Congress has come with a couple of lumps of coal for their stockings.
Take a look at some of the provisions I am talking about. Take the provision of the child support enforcement. This is essential to helping families achieve self-sufficiency. For families in poverty who receive child support, those payments account for an average of about 30 percent of their income. Next to a mother's earnings, child support is the largest income source for poor families receiving assistance. Child support payments are used to pay for food, child care, shelter, and the most basic essentials of life. The bill slashes funding for these child support enforcement efforts.
The Congressional Budget Office estimates that as a result of the cuts, more than $8.4 billion in delinquent payments will go uncollected in the coming 10 years. The biggest negative impact will be by children living in poverty and low-income households. One hundred seventy-six thousand children benefit from child support payments in my State of Iowa alone. In the past, President Bush himself praised the program, calling it one of our highest performing social services programs, and he is right. For every dollar in Government spending, $4.38 is recovered for families in child support payments.
Since 1996, there has been an 82-percent increase in collections, from $12 billion to $22 billion. If we were smart, if we were compassionate, if we were looking at ways to get the most bang for the taxpayers' dollar, we would be increasing funding for the child support enforcement program. The bill before us cuts this program in order to make way for more tax cuts for the wealthiest. It is simply unconscionable.
Let us take a look at Medicaid. I am very concerned about the cuts to Medicaid in this bill. I have said all along, if one wants to do something about Medicaid we ought to have a fair, honest, open debate about reforming Medicaid. We should do so in a way that does no harm to the beneficiaries because who are the beneficiaries of Medicaid? The poorest among us, poor women and children, the disabled, low-income elderly who need access to long-term care.
This bill before us today makes two changes that are permanent changes. One, under this bill, States can now alter or eliminate services to individuals. They can do it on their own. Secondly, the bill allows States to charge fees--sometimes it could be exorbitant fees--on many services where there were no fees before. Again, this could limit access to care for so many.
For example, States may provide any child, even those whose families have the lowest incomes, with a smaller benefit package than they have today. That means that low-income children, no matter how poor, are no longer guaranteed, as they are now, vision screening; no longer guaranteed coverage for eyeglasses; no longer guaranteed therapy services, medical equipment or any other benefit.
This bill would allow States to charge up to 20 percent of the cost of each medication that an individual gets in Medicaid. For individuals who take multiple drugs, this is 20 percent for each medication, so an individual who has multiple drugs or maybe an individual who needs expensive medication, these provisions could, in effect, eliminate access to needed medicines.
Keep in mind these are people who qualify for Medicaid. That means they are poor, by definition. They do not have money. So now we are going to ask them to pay more for services? Now we may ask them to pay for eyeglasses for their kids. Well, their kid needs eyeglasses, they do not have any money, they cannot pay for it, tough. That is the way it was 50 years ago in our country.
I suppose they can go get charity, can they not? I forget about that. That is right. I suppose they could go to their local church or their local synagogue maybe, local mosque, and maybe they will pay for all the eyeglasses for all the poor kids in our country now.
Under the bill, medical care providers can deny medical care if the patient has no ability to pay the charges at the time the care is needed. States can terminate coverage if the family cannot pay the monthly premiums. Again, these changes were made despite a large body of evidence, research, and studies that determined that such cost- sharing increases are likely to lead many low-income Medicaid patients to forgo various health care services and medications or not to enroll in Medicaid.
Guess what. When they do not take their needed medications, when they forgo needed health services, when they do not sign up for Medicaid, guess where they are seen. They are in the emergency room, and we are paying three, four, five times as much to help them. So much for the health care safety net that we have worked so many years to provide for low-income Americans.
Let us look at education, student loans. The reconciliation bill increases the interest rates paid by the parents of students who are taking out loans to help their kids. Merry Christmas; you are going to get higher interest payments.
It also creates a potential problem for the federally operated direct loan program. This is a direct loan program utilized by many schools. The University of Iowa, UNI, Iowa State University in my State all use it. This bill before us says the accounting of the administrative costs for the direct loan program now goes to Labor and Health and Human Services rather than being automatic. That means it is subject to a cut. This year's Labor-HHS-Education bill has been cut this year. And, I expect next year could be very difficult.
Let's look at agriculture and rural development, so important in my State and so many other States. I have long believed that there was really no justification for making budget cuts in the area of agriculture and rural development programs. Commodity prices are down. Prices for energy and fertilizer and other goods and services
that farmers buy are sharply higher. Rural communities are struggling to hold onto jobs, to survive.
Keep in mind, when we wrote the 2002 farm bill--I happened to be chairman at that time--we stayed within the budget allocation we were given. In fact, the commodity programs in that bill have cost us $14 billion less than what we were allocated. That is $14 billion that we saved the taxpayers of this country.
There were commitments made in the farm bill, but this reconciliation bill reneges on those commitments. In agriculture and rural programs, again, the sacrifice is being imposed on those least able to bear it. It is hard to understand what they have in mind for our farmers or rural communities.
Secretary Johanns and the President and others have been going around the country saying the future of farm policy lies in less emphasis on the traditional commodity programs and greater focus on conservation, renewable energy, agricultural development, and agricultural research. You cannot argue with that. It all sounds good. That is what we did in the 2002 farm bill because these types of assistance are all allowed under the WTO trade agreements. We put those in the farm bill. We put a tremendous focus on conservation in the farm bill.
President Bush, when he signed it, touted it and said oh, this is wonderful. There is a lot of good conservation. We put in for the first time ever an energy title in the farm bill. It came out of the Senate, not the House, with an energy title to get farmers--to get us all focused on energy.
Rural economic development and new rural investment-type programs for rural development, we put in money for broadband extension to small communities all over America. Guess what they are cutting in the reconciliation bill: conservation, renewable energy, rural economic development, agricultural research--all being cut. Conservation suffers the largest funding cuts of all, and the Conservation Security Program is hit the worst. The Conservation Security Program is a voluntary program of incentive payments for farm and ranch conservation practices, exactly the kind of program that Secretary Johannes and the administration are talking about as they go around the country. Yet the Conservation Security Program is virtually demolished in the bill before us. It is cut back so far that there will probably be few enrollments next year. The damage to the CSP is only a part of the serious cuts to a number of farm conservation programs in this bill.
Some argue that in the Defense appropriations bill there will be some money to make up for cuts in conservation. Don't be misled. Defense appropriations funds are not even available until 2008, and then only if Congress doesn't take them out later on, as they have done year after year. What is going on here? Why are drastic cuts conservation being made in one bill and then we have a restoration a few years later in another bill?
The DOD bill is going to come before us, and you will hear some talk about: ``There is money in there. We have some money for conservation.'' There is money in there for 2008 but, guess what, next year they may come and say we need that money, we will make up for it in 2009. They may keep doing this every year to us, the old shell game.
The bill takes away rural development funding to expand high-speed broadband access in rural communities. President Bush set a goal. He set it in Des Moines, IA. We are going to have broadband in all rural communities by 2007. Yet they are cutting the funding in the reconciliation bill for that very purpose. Do I hear anything from the President about it? Not a peep.
The bill takes away $20 million of $23 million for an innovative program to help farmers and rural businesses adopt renewable energy systems and energy efficiencies and improvements. When you take $20 million out of a $23 million fund, that kills it. Let's face it. I guess the $3 million they are leaving is for some bureaucrats so they can sit at their desks and twiddle their thumbs because and little else.
The bill cuts $760 million, almost three-quarters of a billion dollars, out of funding that we had in the farm bill that goes to agricultural research.
Again, the administration has just been in Hong Kong saying we have to push for cuts to farm income and commodity programs to make them combined with WTO. But at the same time they are in Hong Kong, they are here in the House and Senate cutting the very programs to sustain farmers, to sustain rural communities, and provide for rural economic development that will be consistent with WTO provisions.
I said all along the reason they are doing this is not to cut the deficit. The deficit actually goes up under this bill. I think of the word, ``reconciliation.'' We have before us the reconciliation bill. ``Reconciliation''--nice word; to reconcile, to make things even. To reconcile things. To make them fit.
When we passed the Budget Act 30 years ago we put in this reconciliation process so that the budget would come out, the Appropriations Committee would do their work, and then after they did all their work they would reconcile the spending with the budget, so as to keep the deficit under control. That is the way it is supposed to work.
We had a budget. We did all of our appropriations work. We have the reconciliation bills. Does the reconciliation bills make the deficit come down? Not on your life. This reconciliation bill actually is the first in a pair of reconciliation bills that increases the deficit so it has the reverse effect of what reconciliation bills were supposed to be. They may use that word, but this is a deficit-increasing process. This is one of a pair of bills to provide tax giveaways to the wealthy and increase the deficit. It sure cannot properly be called a reconciliation bill.
So they cut child support enforcement, foster care benefits, cut Medicaid, make students pay more interest on their loans for going to college. But we get to ram through $70 billion in more tax giveaways mostly for the most privileged. Not only is this fiscally irresponsible, it is the wrong priorities. It is the wrong values for America.
The two main tax provisions we are considering in this process are, No. 1, the extension of the dividends and capital gains cuts and No, 2, the alternative minimum tax. The extension of the dividends and capital gains tax cuts for just 2 years will cost the Treasury $50 billion. Because of it, 40 percent of the benefits of the House Reconciliation Tax bill will go to individuals making over $1 million a year.
Back in 2001, when they rammed through the first year's tax giveaway bill, they purposely doubled the number of taxpayers who would pay higher taxes because of the alternative minimum tax, but then they delayed the impact for the first few years. Now we have to pay the Piper to the tune of $30 billion just to fix it for 2006.
This chart is a little hard to read. It is from the official Congressional Joint Tax Committee explaining the bill written at the time. Basically, under the old law before the tax cuts of 2001, by 2010 there would be 17.5 million Americans paying the alternative minimum tax. When they passed the tax giveaway program of 2001, it doubled it to 35.5 million. Many of these are basically middle-income people. Now we all want to fix it. To fix it costs $30 billion for just 2006.
Again, the Republicans will argue that everyone benefits from the 2001 and 2003 tax cuts. I guess that is true. Everyone benefits. Even when you get crumbs from the table, you get food. Even when some crumbs fall off the table, you can say: Well, the people on the floor got some food. The same with tax cuts.
Look at the chart. The bottom fifth of taxpayers, individuals and families making under $13,500 a year, gain an average of $23 a year. This is the bottom 20 percent. These are the one out of every five Americans.
I know it is almost hard to believe that for people around here when you are making $157,000 a year, and out of 100 Senators you have some who are megamillionaires. It is hard to imagine one out of five people outside this building, outside of these hallowed halls, one out of five making less than $13,478 a year. They got 23 bucks. You can say: Well, they got a break--23 bucks. Will that buy 8 gallons of gasoline? Well, maybe--7 or 8 gallons of gasoline. It will not even fill up your tank. That is for 1 year.
People in the middle 20 percent who make between $25,847 and $44,451, they
got $618 a year. It is not bad. But you spread that over a year's time, that is a tax cut of about $26 a paycheck.
That is why, when you ask your typical middle-income American, Did you see any gain from this tax cut, they will say, Are you kidding? They might have gotten $26 a paycheck. Guess what. It went out in higher taxes for their property taxes. Why? Because we have cut back funding for No Child Left Behind and for education and for special education which means that middle-income families have to pay more on their property taxes for education and that chewed up more than $26 a paycheck which they got back. Again, a good old Republican tax shell game.
Where did the money go? The top one-tenth of 1 percent of income earners, people making over $1,589,000 a year--yes, there are people in America who make that kind of money. I don't hold that against them. That is fine. It is part of the American dream--to make money. But it is not the whole American dream. Over the last 4 years, $1.7 billion in tax cuts, 145,000 people with incomes over $1.59 million a year got $195,762 a year. I will bet they noticed that.
Again, the old trickle-down capitalism. All you have to do is give more money to the top and it all kind of trickles down. The best way to help the poor at the bottom is set a lavish table with all the finest foods and let the people at top eat the best, drink the best and the crumbs will fall off and the poor will get help. Trickle-down economics, trickle-down capitalism.
There is another form of capitalism. It is called percolate-up capitalism. It is where you invest in education, it is where you get people decent jobs and job training. It is where you provide decent housing and health care so people are able to work and keep their families together. It is a kind of a capitalism that understands you don't eat your seed corn. You invest in people, and these people then became better educated, healthier, more productive citizens, and they make the pot grow.
Other examples of the difference between trickle-down capitalism and percolate-up capitalism. Sure. Look at the 1981 tax cut when Reagan came in, big, massive tax cuts, again, mostly for the wealthy. We lost 3.5 million jobs in the 18 months after it passed. Guess what. Later, we saw employment rise. But, that followed several tax increases.
The Democratic administration came in, in 1993. Yes. We had a responsible tax increase in large part on the wealthy to help eliminate the huge deficits. Many on the other side predicted economic disaster. Look at what happened. We got 4.4 million new jobs in the following 18 months. That is percolate up. That is giving people hope, giving people jobs. Guess what. Everybody did better. The rising tide lifted all the boats.
Then we come back in 2001. Again, similar to 1981, we had not learned our lesson, massive tax giveaways for the wealthiest, large increases the deficit, we lost 2.7 million jobs.
We keep doing trickle-down economics. We tried it under Reagan. We tried it under Bush. The same thing happened: less new jobs. But there is something about a belief system and trickle-down economics. I will tell you what that belief is. Their wealthy friends made out like bandits. That is exactly what happened.
Simply put, what we have before us is not a reconciliation bill. What we have before us is a bill that turns topsy-turvy what we are supposed to be about, in terms of providing for justice in our society, a fair shot at the American dream to ensure that people have a decent safety net when things happen beyond their control; when they become disabled, when they get sick, when families split up, and the father deserts and isn't paying child support any longer.
We need to pay attention.
In terms of topsy-turvy, what we are supposed to do at this time of the year--we all remember Charles Dickens' classic tale of ``A Christmas Carol,'' the story of Ebenezer Scrooge. He learns the true meaning of Christmas at the end and opens his heart to those less fortunate than he.
Unfortunately, in the Congress, life does not imitate art.
Less than a week before Christmas, Congress is poised to deliver a cruel blow to the most underprivileged and disadvantaged in our society. Unlike Dickens' tale, no remorse at the end, no nagging conscience, no change of heart at the end of the day. In this Congress, in this Senate, Scrooge would feel right at home. This is Scrooge's domicile. Scrooge lives in the Senate and in the House.
That is why we need to reject this proposal. We need to reject it. We need to have the spirit of Christmas to understand that there are less fortunate in our society. They need hope. They need a hand up. They need the Government to make sure that their kids can get a decent education and housing and health care, that they will get their child support payment, that they will invest in medical research.
That is what we ought to be doing. That is why we have to defeat this conference report under the so-called reconciliation process. We do need to extend some tax provisions, but they should be progressively paid for.
Send this bill back. Let us be similar to Scrooge at the end, when we look upon the poor family and we have a change of heart and we realize that what we have done before we can't keep doing. Let us have the change of heart and defeat this so-called reconciliation bill. Let us have a continuing resolution, let us come back after the first of the year and do the right thing for the American people.
I yield the floor, and I suggest the absence of a quorum.