May 17, 1995 CONGRESSIONAL RECORD — HOUSE H 5175

and killed the balanced-budget amendment in the Senate.

Now, once again, they are saying we

are going to balance the budget on the

backs of senior citizens by cutting

medicare and Social Security.

And so I would like to set the record

straight on exactly what we are going

to do about medicare and Social Security.

First, we’re not touching Social Security to balance the budget. Period.

That charge is simply untrue.

In fact, the only ‘‘cut’’ that Social

Security will experience is a cut in the

current administration’s tax hike on

Social Security benefits.

So I’m having a hard time comprehending the accusation that we’re

‘‘cutting’’ Social Security when all

we’re really doing is providing tax relief for Social Security benefits.

Second, as everyone in this Chamber

is well aware, medicare is going to be

bankrupt in 7 years.

I know everyone has heard this statement time and again recently, but it’s

certainly worth repeating.

For the second year in a row, the

president’s Medicare board of trustees

has stated that under current spending

projections, Medicare will be bankrupt

in 7 short years.

There is no disputing this inescapable fact, and we are taking the lead to

prevent that from happening with our

budget.

We have committed ourselves to preventing that from happening by slowing down the rate of growth in Medicare, not by cutting it.

Medicare spending is actually going

to increase by over $740 billion over the

next 7 years.

Only in Washington, DC can an increase in spending for a program still

be considered a cut.

The dilemma this Congress faces tomorrow will set the tone for the future

of this great Nation for many, many

years to come.

We have arrived at a crossroads, and

we must rise to this historical occasion

armed with a vision for the well-being

of our future generations whose hopes

to realize the American dream are in

the balance.

A vote against the majority’s budget

tomorrow will signify failure to uphold

our responsibility to the millions of

Americans who sent us here to get

Washington out of their wallets.

Many millions of Americans are depending on us tomorrow to do the right

thing to prevent their future from

heading down the wrong road of massive debt.

We must not fail to deliver the American people a sound future.

EFFECTS OF THE PROPOSED

We must pass our budget tomorrow.

BUDGET ON TAXES AND MEDIfCARE

The SPEAKER pro tempore. Under

the Speaker’s announced policy of May

12, 1995, the gentleman from Minnesota

[Mr. GUTKNECHT] is recognized for 60

minutes as the designee of the majority leader.

Mr. GUTKNECHT. Mr. Chairman, I

have listened and I assume most of the

Members have listened today to the debate. I have found it particularly interesting, and I would like to share some

of my time with the gentleman from

Michigan [Mr. HOEKSTRA] tonight.

I would like to also share with the

Members and those who may be watching at home from, and I hope this is

not an ethical violation because I get

no residuals from this book, but this is

a book that I read during the district

work period that was written by my

predecessor, Tim Penny. I commend it

to all of the Members, and other people

who are interested in the budget debate

that is going on, because I think it is

very instructive. He has an awful lot to

say. I would like to share some of those

things with the body tonight.

First of all, Mr. Speaker, after listening to some of the debate earlier today,

I just wanted to talk a little bit, too,

about one of the things we have heard

so much about in the last 2 or 3 days,

and that is the tax cuts for the

wealthy.

I’m not particularly good in math,

and I do not serve on the Committee on

Ways and Means. I did serve on the

Committee on Ways and Means when I

was in the State legislature back in

Minnesota, so I have a little bit of understanding.

However, based on what I do understand about the tax cuts that we passed

earlier this year, about 75 percent,

about three-quarters of the benefits of

the family tax credit, will go to families earning $75,000 a year or less. Perhaps in some places of this great National people earning $75,000 are considered rich, but I do not think in most

places families earning $75,000 and less

are necessarily considered rich.

Another part of that tax cut proposal

that I think is important that will ultimately lead to economic growth is the

cut in the capital gains tax rate. Representing an awful lot of farmers and

small businesses in my district, I think

I do understand something about capital gains taxes. As a matter of fact,

one of the things I really understand is

that 44 percent of the people who get

stuck with a capital gains tax are rich

for one day during their life, the day

they sell their farm or sell their business.

I do not think, back where I come

from in Minnesota, when a farmer who

has worked hard all of his life and sells

his farm, does he really consider himself rich? Obviously, in economic

terms, in real dollar terms, many people would say that when you sell a

farm for half a million dollars or whatever the particular price of that farm,

you would say that they are rich, but

these are people who have worked hard,

who have lived poor all of their lives,

who have made their payments, who

have paid their taxes, and all of a sudden, because on one particular day

they sell an asset, they get stuck with

a capital gains tax.

I think if people will think about

that in those kinds of terms, I think

they will look at this whole thing and

say ‘‘Wait a second, we are not talking

about tax cuts for the rich.’’

Second, I wanted to talk a little bit

about Medicare tonight, because I

think there has also been a good deal of

misunderstanding and disinformation

spread about what we are doing with

Medicare. It has been alluded to earlier

today, but I would call attention to the

Members and folks around the country

to an article that appeared, I believe,

in today’s Investors’ Business Daily. In

that, there is a quotation that just literally jumps off the page.

It says:

Today, Medicaid and Medicare are going up

at 3 times the rate of inflation. We propose

to let it go up at 2 times the rate of inflation. That is not a Medicare or Medicaid cut.

So when you hear all this business about

cuts, let me caution you that this is not

what is going on. We are going to have to increase Medicare and Medicaid at a reduced

rate of growth.

Now, I did not say that, NEWT GINGRICH did not say that. That came from

Bill Clinton. I think that is what we

are doing. We are not talking about

cutting Medicare, we are talking about

reducing the rate of growth.

Mr. Speaker, I also served back in

Minnesota on the Health and Human

Services Committee in the State legislature. I remember just 2 years ago

when we were talking about health

care and how much health care costs

were going up, everyone predicted that

we were going to see double-digit increases in the cost of health care for

the next 5 or 6 years.

In the private sector, and I visited

during the district work period with a

number of health care providers, with

representatives of some of the biggest

insurance companies and HMO’s in the

State of Minnesota, they assured me

that what is happening in the private

sector, because of some of the changes

and reforms that are going on with

more managed care and preferred provider networks, we are seeing health

care costs virtually at or below the inflation rate. We are seeing health care

costs going up at less than 3 percent in

the State of Minnesota.

Using the mathematics that we have

heard about today and the last several

days, we could assume that some of the

health care providers in the State of

Minnesota could be saying ‘‘Compared

to what we thought health care was

going to go up, we are seeing a 7 to 8

percent cut, because we thought health

care costs were going to go up by 10

percent, but because of market-based

reforms that are happening without

the Clinton health care reform plan,

without a whole lot of Government

intervention, we are seeing health care

inflation rates going down by about

one-third or less of what they were expected to be.’’ So using the arithmetic

and some of the rhetoric we have heard

today, I think we could say that we
H 5176 CONGRESSIONAL RECORD — HOUSE May 17, 1995

have seen dramatic cuts in health care

in Minnesota.

Somehow, providers, hospitals and

others, are adjusting to this new system. My sense is that if we allow some

real reform in health care, in the Medicare system, that we can easily live

within the guidelines that have been

proposed by the House Committee on

the Budget.

I just want to say that by just assuming that this is going to go up by 101⁄2

percent per year, if we assumed it was

going to go up 16 percent per year, then

obviously you could say that this is a

12-percent cut, or some other number.

However, the truth of the matter is

that we know that health care costs

can be controlled by the private sector,

because it is happening.

With that, Mr. Speaker, I will yield

to the gentleman from Michigan [Mr.

HOEKSTRA], who has some remarks perhaps to share with us.

Mr. HOEKSTRA. Perhaps we can get

into a little bit of a dialog, because I

think it is very instructive to understand what we are talking about with

Medicare, Mr. Speaker, and also when

we take a look at what we do with the

rest of the budget. If we take a look at

and listen to much of the rhetoric that

has gone on during this 6 to 7 hours of

debate that we had today, you would

think that we were dramatically cutting the budget.

In reality, the standard that we are

setting for the Federal Government to

get to a balanced budget, you know, I

came out of the private sector, and this

is my third year here. The aggressive

posture that we are going to take to

get to a balanced budget is something

that the private sector would look at

and they would basically laugh at.

They would say ‘‘This is an aggressive

plan to get to a balanced budget under

the dire circumstances that you are

under right now? You have a $4.7 trillion debt. A child born this year, in

their lifetime, if we do not change how

we spend and tax, would have to pay

what, $187,000 as their share of interest

in the debt, and you are going to slow

the growth of Federal Government to 3

percent per year?’’

During the break I had an opportunity to go to a number of companies

in my district. I listened to what they

had done. You gave some examples

about what they had done to control

health care costs. I looked, and they

explained to me what they had done to

control product costs. There was a

company in my district that, through

participative management, employee

involvement, creative thinking, new

technology, new thinking about new

ways to do things, for 12 years they

have not had a price increase on their

product, so they now are exporting

around the world, because they have

been able to control costs, not at a rate

equal to inflation, but at a rate 3 or 4

percent below inflation, reducing costs

every year, reducing actual costs.

There was another company in my

district that made an electronic component. In the early 80’s they were

making it for $44. The Japanese came

in and said ‘‘We have taken a look at

this part and we can build it for $13.’’

The company got together, they got together with the management and the

employees, and today they are building

it for less than what the Japanese

quoted to them in the early 1980’s, so

they took a $44 part and they are now

building it for less than $12.

Here we are in Washington, the only

thing, the thing we are going to do is

slow the growth to 3 percent. I really

believe that much of what has been applied in the private sector can and

should be applied to Washington, and

that what we are looking at doing to

balance the budget is not that unreasonable and is very, very doable.

I think we can do it like we did it

with the Contract With America. The

Contract With America said ‘‘We are

going to do this within 100 days,’’ and

we did it within 93. I think if we energize Federal employees, build a partnership with State and local governments, build a partnership with people

at the local level, and come together

on this budget issue, we can improve

performance, we can deliver a better

solution to the American people, and

we can balance the budget, and we can

balance it quicker than 7 years if we

focus and recognize that it has to be

done.

b 2130

Mr. GUTKNECHT. The private sector

is a great example, and I have had the

same story told to me around the district where people found themselves

under competitive pressure. They have

found a way to increase productivity or

do something to reduce their costs. It

has happened in big business and small

business.

I have one particularly fairly large

business in my district that was facing

very competitive measures and in a difficult situation, and they went in and

it was not easy but they found ways to

produce their products at a much lower

cost today than they had 3 or 4 years

ago.

Incidentally, that same company has

found ways to cut their health care

costs. Now that has meant that, you

know, perhaps there are fewer visits to

the doctor, it may means some other

things, it may mean managed care in

some respects. I am not sure what all

they have done, but the point is necessity is the mother of invention. That is

the way the free enterprise system

worked.

The problem in Washington is the solution to every problem seems to be

more money, and the only way we can

get control of the problem is with more

money. But the truth of the matter is

I think the American people are saying

if we are talking about this program or

that or another program that enough is

enough; you have enough tax revenue,

you are going to have to figure out how

to make this thing work. And I think if

we work together I think we can.

Mr. HOEKSTRA. If the gentleman

will yield, we are really talking about

the future of America. We are talking

about security for seniors and we are

talking about opportunities for our

kids.

You know Alan Greenspan came in

and said here was his vision of the benefits of balancing the budget: Children

will have a higher standard of living

than their parents, part of the American dream; there will be improvements in the purchasing power of

everybody’s incomes; there will be a

rise in productivity, a reduction in inflation, strengthening of financial markets, acceleration of long-term economic growth, and a significant drop in

long-term interest rates. This is going

to benefit everybody in this country,

just getting back to a basis where we

have fiscal soundness, good fiscal policy, get to a balanced budget, and I

think one of the goals and objectives

which we had, which we put into the

budget resolution during the debate in

the Budget Committee is saying as we

move to a balanced budget we cannot

forget the fact that when we get to a

balanced budget we need to develop a

surplus, because balancing the budget

is not good enough. We need to make

the next step, which is developing a

surplus and putting a plan in place to

actually pay down the debt. The old

American saying is what, we used to

pay off the mortgage and give our children the farm. If Congress keeps going

the way that it had been going, what

we were going to do was sell the farm

and give our kids the mortgage.

We are now, tomorrow, we are going

to start that historic process that we

are going to go through the next 6

months. We are going to put in a balanced budget plan for 7 years which is

going to guide the authorizing and the

appropriations committees so that by

the end of this year we will have put a

plan in place in May, and for the next

6 months we will manage our fiscal resources to hit that plan.

Mr. GUTKNECHT. The interesting

thing to me, and you alluded to it, I

was home this weekend and talked to

some constituents and tried to explain

essentially what the outline of the

budget plan was going to be, and the

people that I talked to said, you mean

that is all there is. As a matter of fact,

a few of them said we expected real

cuts. We expected you to really cut

programs and what you are talking

about does not sound like the kind of

cuts that we were expecting. As a matter of fact, I think my own sense is

that the American people, at least out

there in the great Midwest, are fully

prepared for more, to shoulder more of

the responsibility in terms of some of

these reductions in spending than I

think this budget is proposing. As a

matter of fact, some I think may actually see this budget resolution as a bit

too timid.
May 17, 1995 CONGRESSIONAL RECORD — HOUSE H 5177

Mr. HOEKSTRA. Maybe too timid,

but I think they will look at the policies in place and ask how are we changing decisionmaking here in Washington, moving more decisionmaking back

to empowering the individuals. What is

the $500-per-child tax credit? It is just

a basic recognition that a family and

parents are a better place to make decisions on how to spend that $500 than

sending that money to Washington.

We are returning power and control

to the States and localities, bringing

decisionmaking back close to the problems, fine tuning the solutions for the

specific problems within the graphic

area.

My district is nine counties, it is a

medium-sized district, but the problems in the southern part of the district or characteristics of the southern

part of the district are very, very different than the northern part of the

district. But what we are finding today

is the decisions are all made here in

Washington for a number of programs,

whether it is school lunch, whether it

is public housing, the decisions are

made here in Washington. What we are

trying to do is move decisions locally.

We want to move a Federal bureaucrat

from being between a child and a

school lunch, let that decision be made

at the local or State level. We want to

move the Federal bureaucrat in Washington away from being the connecting

point between a tenant and a landlord.

Why is a Federal bureaucrat trying to

make those arrangements? Same thing,

we are proposing eliminating the Commerce Department. Why do we need a

Federal bureaucrat in Washington

being between a customer and a potential vendor? It does not make any

sense. That is not a good use of our resource, so we are moving power back to

States and localities. We are at the

same time discarding needless bureaucracies, eliminating duplication and

waste.

One area where we really are cutting,

where the number is actually going to

be less, it is a true cut, it is a cut as defined in the rest of America, and here

in Washington now it also means a cut,

is the foreign aid. That will be I think

an absolute reduction of somewhere in

the neighborhood of 30 or 35 percent.

We are reducing corporate subsidies.

We are going after just about every

area of the budget, except Social Security. We are promoting personal responsibility. The end result is we are

all coming together in a plan to save

the future and save the future for our

kids.

Mr. GUTKNECHT. I went through a

sales training program many years

ago. I did not sell insurance, but it was

actually designed for insurance salesmen, and I never forget the story they

used to use, some of the salesmen used

to use where they would bring with

them a marble, it was a marble, a PingPong ball, a baseball, and a bowling

ball and they would tell potential customers, you know, if you buy your insurance now it will be like carrying

around this marble. You can put it in

your pocket and you will barely know

it is there. But if you wait another 10

years and buy that insurance, it is

going to be like carrying that pingpong ball, and if you wait 10 years after

that it is going to be more like carrying that baseball, and it gets real difficult to carry it around in your pocket. But if you wait until you are about

ready for retirement, its going to be

like carrying around that bowling ball.

That is what we are talking in the Federal budget. The sooner we get started

in solving the problem, the less pain in

terms of solution. If we wait another 5

years, I think everybody knows, the

American people know if we wait another 5 years, whether we are talking

about Medicare or impending bankruptcy or whether we are talking about

the growing national debt, if we wait

another 5 years the problem is going to

be just that much more difficult to

solve, and so rather than having to

carry around a ping-pong ball in your

pockets we are going to have a bowling

ball, and the weight of that ball is

going to be hung around the necks of

our children.

Mr. HOEKSTRA. We know what the

statistics are. We know within 7 years

Medicare will be bankrupt. We know if

we do not change our spending priorities that by the year 2012 all the revenues we collect in taxes will be used to

pay for two things: entitlements, and

that thing that returns so much value

to the country, interest on the debt. I

mean that is just money that is gone

away. You know, in 2012 we could be

talking about student loans; there will

not be any money for them. We can

talk about building highways; there

will not be any money. We talk about

national defense; there will not be any

money, unless, what? We ask the

American people to share more of their

income with us. What is it, the

generational accounting which came

out in the President’s budget a year

ago said if we continue at taxing and

spending or spending at this rate, the

next generation could see an effective

tax rate of 84 percent. Which means

that for young people going out and

working, for anybody going out and

working, 84 cents would come to Washington or, yes, and you would get to

keep 16 cents of it for yourself, which

means Tax Freedom Day would move

to somewhere in November.

Mr. GUTKNECHT. Thanksgiving.

Mr. HOEKSTRA. At least we would

have something else to be very thankful for, that we only had to work until

Thanksgiving to pay the Government

their share to keep the Government

running and we could then work from

Thanksgiving to the first of the year.

We need to be moving in the other direction of getting to the balanced

budgets and paying the debt down.

Mr. GUTKNECHT. I was going to

share one of the stories I tell a lot of

folks. When I graduated, most people

do not remember who the speaker was

at their commencement address when

they graduated from college, I do not

remember his name, but I remember

who it was and what he talked about

that day. It was the director of the

United States Census, and I graduated

from college, I was 22 years old, graduated in 1973. I was born in 1951. And he

said something interesting talking

about demographics, and I think it is

very important, I think the American

people need to understand this. I was

born in 1951, and he told us that day at

our graduation that there were more

kids born in 1951 than any other single

year. He said, ‘‘You are the peak of the

baby boomers, and that is going to be

important as you go through your life,

whether people are selling insurance or

encyclopedias or automobiles,’’ and

you can see that reflected in the advertising. But I think we need to think

about this as well. Those baby boomers

are going to start retiring at about the

year 2011 or 2012, and I think the American people need to be reminded that if

we have a problem now with Medicare,

if Medicare is on the verge of bankruptcy now, and will be insolvent by

the year 2002, imagine, the people we

are dealing with here are people who

were born essentially during World War

II, and the birth rate during World War

II was incredibly low. Imagine what is

going to happen to us when the baby

boomers start to retire in the year 2010

and 2011, and that is why it is critical

in my opinion we have real Medicare

reform and begin the process this year.

I think if we do we can guarantee Medicare will be there for baby boomers and

beyond. If we do not, I think it is pretty certain it will not be. I think there

is growing concern among people my

age that the sins of our fathers are now

being visited upon us and will ultimately be visited upon our children.

Mr. HOEKSTRA. The demographics

do not work in your favor, but I think

as we talk about reforming Medicare

we are talking about putting in place a

number of policies and practices that

have already worked and are working

in the private sector.

Medicare basically has not been reformed or enhanced or modified or had

any creative thinking applied to it for

the last the 20 to 25 years, and we are

still allowing spending per beneficiary,

spending per person receiving Medicare

is going to increase by somewhere between 33 to 40 percent depending upon

what State you are in, but on average

we are spending $4,800 per person in

1995. We are allowing within this budget to be spending up to $6,400 on average per person by the year 2002. That

gives us a lot of leeway to examine

what is going on in the private sector,

to reform and enhance Medicare to

take a look at the discrepancies by

State.

I think one of the speakers today

made the comparison about what you

spend per person on Medicare in Minnesota, which has a fabulous health

care system, and compare it I think it

was somewhere in the neighborhood of

$3,000, going up to something like $5,000
H 5178 CONGRESSIONAL RECORD — HOUSE May 17, 1995

compared to the expenditures in Connecticut, which was like $5,000 going up

to somewhere near $6,000 to $7,000, and

saying you know we can take a look

and what we need to be doing is taking

a look at the different programs in different States and say what are the dynamics in this State that are driving

costs to this level and to be very efficient and effective, and there are some

things in these areas that we can learn

and transfer to the high-cost States because like I said, Minnesota, my area,

I think we are at about two-thirds of

the national average for many of the

health care costs.

Ms. DELAURO. Mr. Speaker, will the

gentleman yield?

Mr. HOEKSTRA. I yield to the gentlewoman from Connecticut.

Ms. DELAURO. Mr. Speaker, representing Connecticut, I just wanted to

correct the numbers that you just

talked about with regard to Connecticut. There are over 503,906 Medicare enrollees in Connecticut, and in fact what

would be the case is that they would

pay $1,167 more in the year 2002 alone,

and $3,885 more over the next 7 years.

Overall, just so that the record will

show, the State of Connecticut would

lose $1.2 billion in Medicare funding in

2002 alone and $4.1 billion over 7 years.

So I just wanted to present that in

terms of the record on this issue. I

thank the gentleman.

Mr. GUTKNECHT. Reclaiming my

time, and I think the gentleman over

here said at the end of 7 years the program goes bankrupt, then we will not

pay any benefits at all if we do not

make any changes. I think that is the

issue we are talking about, and all of

this is built on assumptions. If you assume there can be no changes in all of

this, this assumes there can be no

changes in the way the Medicare system is managed.

Ms. DELAURO. You know, there is.

Mr. GUTKNECHT. Reclaiming my

time, we assumed in the State of Minnesota a couple years ago that health

care costs were going to continue to go

up at double-digit inflation rates.

Without any significant reform in the

Federal level we have demonstrated

that that was not necessarily the case.

b 2145

That is the issue. The system can be

reformed. Medicare, in my opinion, is

the worst of all worlds. What you have

is a fee-for-service system that cranks

down fees. We have cost controls in a

fee-for-service system. That is a prescription for disaster. That is why you

see the Medicare system going up as

fast as it is going without any changes.

I yield to the gentleman from Pennsylvania [Mr. WALKER].

Mr. WALKER. The fallacy of everything they are talking about is the fact

they go out to the year 2002. Where

they have all the figures they run up.

The whole system collapses, and people

end up with nothing, or, and this is

what we suspect is really the agenda of

the other side, they come back to the

employers and the employees, and they

say the whole system is collapsing, we

now have to ante up. That is a 125-percent increase on both employers and

employees at that point and a 300-percent increase in copayments for the

beneficiary in order to maintain the

system they now say we ought not

touch, there ought not to be any

change.

They are willing to risk bankruptcy

of the Medicare system. That is what

they have said all day long on the

floor, that bankruptcy is an option, because they keep talking about figures

that drive the system into bankruptcy.

I think most Americans looking at it

think that bankrupting the Medicare

system in order to serve political purposes is a tragedy. It just makes no

sense whatsoever.

Mr. BONIOR. Mr. Speaker, will the

gentleman yield.

Mr. GUTKNECHT. I yield to the gentleman from Michigan [Mr. BONIOR].

Mr. BONIOR. I thank my colleague

for yielding.

I would just like to ask the gentleman from Pennsylvania, who on the

floor, you just alleged that someone on

this floor on our side of the aisle made

a statement that we were for bankrupting Medicare. Who did that?

Mr. WALKER. If the gentleman will

yield.

Mr. BONIOR. That is an outrageous

statement. No one on this side of the

aisle made that statement.

Mr. WALKER. You did not listen

very carefully. What I said was all of

the assumptions that were used on the

floor today were predicated on the fact

we only had to worry about the system

out until 2002, and that all the figures

you used that you call cuts in Medicare

are, in fact, cuts off of a baseline that

drives the system into bankruptcy, and

so, therefore, my point is that the assumption that you are raising is that

we can continue to spend at the

present rates, which we know all know,

according to the trustees’ report,

drives the system into bankruptcy, and

so my point is that virtually your entire argument on your side today was

predicated on the fact you are willing

to allow the system to go bankrupt.

Mr. BONIOR. If the gentleman will

yield on that point, I would like to respond.

Mr. GUTKNECHT. Let me respond.

Let me just say again, we did not make

this up. We did not write the report.

And we read today in the paper this

quote: ‘‘Today Medicaid and Medicare

are going up at 3 times the rate of inflation.’’ That is absolutely true. We

propose to let it go up at 2 times the

rate of inflation. That is not Medicare

or Medicaid cut.

So, when you hear all of this about

cuts, let me caution you that this is

not what is going on. I did not say

that. We did not say that. Although we

are saying that that is what President

Clinton said just last year. And so all

of this scare-mongering that is going

on over the Medicare issue, we believe,

and I think you would agree, that this

system can be reformed, we can control

costs if we put the right incentives. It

is happening in the private sector

today. That is what this debate is

about, and I think what the gentleman

from Pennsylvania [Mr. WALKER] is

saying, is some people are saying it

cannot be reformed, it must be allowed

to continue to grow at exponential

rates and that ultimately it will just

go bankrupt, and then we will figure

out how to do something different.

But if we make the changes this

year, we can avoid bankruptcy. We can

protect, we can preserve, in fact, we believe you can improve the Medicare

system, provide better care to the senior citizens, keep the system solvent

and really have a system we can all be

proud of. It is happening today in the

private sector, and those who say it

cannot happen in Medicaid and Medicare I think are arguing against the

facts that are happening every day out

in the private sector.

I yield to the gentleman from Michigan [Mr. HOEKSTRA].

Mr. HOEKSTRA. I thank the gentleman for yielding.

What we have been doing for the last

number of months, actually what we

started doing in 1993, we came forward

with a budget alternative, major conflict within our conference, but we said

we wanted to stand for a budget alternative and we wanted to have a document out there that said that is who

we are and what we stand for, and we

presented a very credible alternative

budget.

We did the same thing in 1994. And

what both of those budgets did is they

prepared us to be able to lead in 1995 to

present a credible budget, to present a

solid plan to get us to a balanced budget by the year 2002, to save the future

for our kids, and we have a President

who, running for election, promised

that he would be driving toward a balanced budget, and we started the budget debate in the Committee on the

Budget in 1995. What did we see, we saw

more of the same, continuing $200 billion deficits, no plan to save Medicare,

no plan to drive down the deficit. As a

matter of fact, we saw exploding deficits as you went out 5, 6, and 7 years.

So what we have done is we have put

together, we have put down on paper,

we are out here saying we have a plan.

Remember when people used to say,

‘‘Why don’t those guys stand for anything?’’ For 3 years we have demonstrated, and now we are going to

have the opportunity to drive a plan

that does exactly what we have been

talking about: Tax relief for families, a

balanced budget. We do go through;

you know, we eliminate three Cabinet

departments. We eliminate the Energy

Department, we eliminate the Commerce Department, we eliminated Education, areas where we do not think

the Federal Government has a primary

role in setting policy. We eliminate 284

programs.
May 17, 1995 CONGRESSIONAL RECORD — HOUSE H 5179

In many cases, right now, and in the

Economic and Educational Opportunities Committee, I think is a great example, we are going through a process

right now where we have something

like 153 different job training programs. Take a look at this from a

consumer standpoint. You are an

American citizen out there, and you

are taking a look and saying, ‘‘I need

some help to acquire new skills,’’ recognizing that jobs are changing, technology is changing, ‘‘I need some

help.’’ You look at this, and you say,

‘‘Whoa, where do I go? There are 153

different programs? What little box do

I fit into? Am I a displaced worker? Am

I a senior? Am I somebody right out of

school? Where is a box?’’ That does not

work.

What we are doing is we are consolidating that back down into four block

grants. The money goes back to the

States so that for west Michigan they

can design a training program in conjunction with the industry and the people in west Michigan and the local colleges to put together a program that

works for west Michigan. They can go

to Detroit, which has different problems, very different opportunities.

They can develop a program for Detroit. They can build off of successes in

Detroit. They can go to Minnesota, and

the Governor there can put together a

program.

What we have done is we have basically eliminated, you know, again we

are eliminating that bureaucrat in

Washington that is standing between

an individual and that person’s need to

get new skills, to make them more employable in higher paying jobs.

Mr. GUTKNECHT. So much of what

we have seen in the development of the

bureaucratic welfare state and all the

Federal programs, I think they all

started with good intentions, the problem is they are all built on the basic

premise the Federal Government

knows best. I think what we are really

seeing is the dabate between those people who believe the Federal Government is too big, spends too much, is

too bureaucratic, has too many rules,

and those who believe the status quo

has to be defended.

What we have said from the very

beginnning, and I think the American

people said last November the status

quo should not live there anymore, it is

time for some real changed and to

shake up Washington, and to that end,

that is what we are going.

I want to just remind Members of

some campaign promises a few years

ago. One was to end welfare as we know

it. The second was to balance the budget within 5 years. And the third was to

provide a tax cut for the middle class.

You know, it has been amazing to me

the harsh tone of some of the rhetoric

around here over the last several

weeks, because in many respects what

we are really trying to do is to help

President Clinton keep some of those

campaign promises, because that is essentially what we are trying to do.

And, frankly, we would expect a little

more cooperation from 1600 Pennsylvania Avenue than we have had, because

when you look at our program, it basically is to end welfare as we know it,

to balance the budget. I personally

would like to do it in 5 years. I am willing to live with 7. I plan to vote for the

Neumann budget. I think it can be

done, and to provide tax cuts for the

middle class. We want to keep the

economy going. We want to provide

more hope, growth and opportunity in

the private sector. Those are the things

we really want.

I yield maybe for some last comments to the gentleman from Michigan

[Mr. HOEKSTRA], and then we will finish

up and give the other folks a chance at

this.

Mr. HOEKSTRA. I think, you know,

in summary, you said exactly what the

key building blocks of what our plan

are, much of which were outlined in

the 1992 election campaign, where at

one time they were part of President

Clinton’s agenda, tax relief, reforming

welfare, and balancing the budget,

three components of this plan.

The reason they are so important is

what we talked about earlier. This is

the type of plan that really puts America back on the right road. I mean it is

going to mean 7 hard years of work

just doing this plan. It does not mean

we have implemented it. We now are

going to have to hold our feet to the

fire to actually go through and make

the tough decisions each and every

year to stick to this plan, but it is a

wonderful start.

I think for you as a freshman, the

first budget proposal that you are

going to have an opportunity not only

to vote on but the first one that you

are going to have an opportunity to

pass, because I do believe we will pass

it tomorrow, I mean I think tomorrow

will be a historic day where we actually now lay out that plan. We vote on

it, and we will pass it, and we will pass

it in a bipartisan way.

We are laying the long-term foundation for the contract with our children,

saying this is the America that we

want to leave you, one that is fiscally

sound, one that will be on a road to

balancing the budget and one that will

also then enable us to start the discussion about how we are going to pay

down the debt.

We are going to cut spending. We are

returning power to families. We are

protecting Social Security. We are preserving and protecting and improving

Medicare, and the most important

thing, not only do we have the right vision for what we want to accomplish, I

believe that tomorrow and actually

what we have done for the first 41⁄2

months of this year, we have a vision

for America, and now we are also providing the leadership to actually implement it.

We need much more than vision. I

think, you know, we were talking

about 1992. Anybody can have a vision.

What you have to have is you have to

have the courage and the demonstrated

leadership and the capability to lead to

make that vision a reality.

So now we are reaching for that vision. We are putting that vision in

place for a balanced budget, for more

economic opportunity, for a better future for our kids, and as we start moving there, we can actually start expanding our vision for even more improvement in America and a better future, so that I think that is a great

way to start, and we could not have

done it without 73 new freshmen here

to join us, and thank you very much

for all that you have contributed to

help make these first 5 months such a

historic opportunity not only for the

House of Representatives but for all of

America.

I thank the gentleman for yielding.

Mr. GUTKNECHT. I thank the gentleman from Michigan [Mr. HOEKSTRA].

I want to close with a few quotes,

some of them from this book, which, as

I say, I read during the district work

period, and I found it very insightful

and instructive.

I know that some of the Members

around here will read this, and there

are some things in it that are brutally

honest, particularly by Washington

standards, about the culture of Washington and some of the things that

have happened, and part of the reason

we have some of the problems in Washington we do have.

But let me just read one of the

quotes that he opens chapter 3 with,

and it is from Thomas Jefferson. He

said:

I, however, place the economy among the

first and most important Republican virtues,

and public debt as the greatest of the dangers to be feared, and to preserve their independence, we must not let our rulers load us

with perpetual debt. We must make our election between economy and liberty or profusion and servitude.

I think Jefferson said it so well, and

then Tim Penny goes on and begins his

chapter with these sentences, and I

think it really got to me. He said:

This republic is entering its 219th year, and

remains the most admired and copied form of

government in the world. For 192 of 219 of

those years, this government shared something that no longer exists, an ethic of frugality.

I think that is what we are really

trying to put back in this government,

an ethic of frugality.

If you few look at the back of the

book, on the back page there is a

quotation I paraphrase only slightly,

from former Senator Paul Tsongas,

from the State of Massachusetts, and I

love this. He says, ‘‘When the inevitable consequences of massive debt are

visited upon our children, they will ask

us why and how it was allowed to happen. There will be no good reason to

the why.’’

But I think the Members in this body

will know how.

The Chinese philosopher, Lao Tsu,

said, ‘‘The journey of a thousand

leagues begins with a single step’’.

Tomorrow, as my colleague said, we

have an opportunity, in fact I think we
H 5180 CONGRESSIONAL RECORD — HOUSE May 17, 1995

have an obligation to take the first

giant step toward balancing this massive Federal budget and bringing this

debt into line.

b 2200

I think we owe it to ourselves, we

owe it to our fellow citizens, but most

importantly I think we owe it to our

children and grandchildren. I think it

is time for a little common sense here

in Washington. I think it is time for us

to begin the process of living up to our

obligation, and I think it is time for us

to balance the budget. I think the

American people are way out in front

of us, I think they expect no less, and

I think tomorrow we will make good on

that pledge and we will begin that

process.

THE BUDGET VERSUS OUR

fSENIORS

The SPEAKER pro tempore (Mr. FOX

of Pennsylvania). Under the Speaker’s

announced policy of May 12, 1995, the

gentleman from Michigan [Mr. BONIOR]

is recognized for 60 minutes as the designee of the minority leader.

Mr. BONIOR. Mr. Speaker, I am delighted to be joined this evening by

some very good friends, and we are

going to talk about this budget, and we

are going to talk about the Medicare

system. I am joined by the gentlewoman from California [Ms. PELOSI],

the gentlewoman from Connecticut

[Ms. DELAURO], and the gentleman

from Vermont [Mr. SANDERS].

Mr. Speaker, let me just answer—I

want to answer my friends from the

other side of the aisle when they were

speaking, and I have the opportunity

to do so now. They talked about the

issue of the Medicare trust fund and

about its bankruptcy. It should be duly

noted that less than 2 months ago, on

this very floor, every single Republican

voted for a tax bill that took $87 billion

out of that same Medicare trust fund in

order to pay, in order to pay, for a tax

break for the wealthiest people in our

society, and that is what happened.

Now it is rather disturbing to hear

them say that they are going to fix

this. They were not for the Medicare

program in 1965. They have not been

for fixing it or doing anything about it

since. In fact, the gentleman from

Texas [Mr. ARMEY] and the gentleman

from Georgia [Mr. GINGRICH], their

leaders, have said repeatedly on occasions, recent occasions, that they

wanted to change the nature of the system, and, by golly, they certainly are.

Let me, if I could, switch gears a little bit and talk about the people who

are affected here.

Mr. Speaker, it was 50 years ago this

week that America defeated Nazi Germany in World War II, and all over

American and all over Europe we celebrated that day by remembering the

brave men and women on both the battlefront and on the home front who led

this country to victory.

As my colleagues know, looking at

pictures of our parents and grandparents taken back then, they were so

young, and they were so full of life, it

is hard to believe that they would ever

grow old. But they have.

The generation that beat Hitler, that

built our economy, that raised our

families, are now America’s senior citizens, and today many of them are living on fixed incomes. Their Social Security check is the only thing that

many older Americans have each

month to pay their rent, to pay their

heating bill, to pay for their food, and

medicine and their doctor bills. For

most of them it is not easy. They have

to struggle to make ends meet.

But today, instead of trying to make

it a little easier for them, to help them

through a very difficult time in their

life, the Republicans in the Congress

are trying to make living very hard for

them.

Mr. Speaker, as I said a little earlier,

this comes down to one very, very

basic and simple question: ‘‘Do you

think we should cut Medicare, Medicaid, and Social Security in order to pay

for tax cuts for the very privileged

few?’’ In the next few days we are going

to see a lot of charts and numbers on

this floor, and we saw them today, but

this debate is not just about numbers.

It is about people, it is about people,

people like this lady right here, Margaret Lesley, who I have a picture of.

Margaret is a proud senior citizen

and a dear friend of mine who lives in

my district. Fifty-one years ago she

was known to her friends as Maggie the

Riveter, and she was young, she answered the call of this country. She

helped build the B–29’s that helped the

Allies win the Second World War.

Like most of her generation, Mr.

Speaker, today Margaret lives on Social Security. After paying for her

rent, and her medicine, and her Medicare premium, and her medigap premium, she is left at the end of the

month with $130, and with that she has

to pay for her food, her heat, the bills

that she has, or perhaps some little

extra that she desires, and she struggles mightily to make ends meet.

But instead of trying to make

Margaret’s life a little easier, this Republican budget is going to make it a

heck of a lot harder. The budget before

us today will take $240 out of

Maragaret’s Social Security check, and

over the next 7 years it will take $3,500

out of her pocket to pay for Medicare,

and then the last year that money will

amount to over a thousand dollars.

Now they are not doing that to balance the budget or to cut the deficit.

The Republicans are cutting Medicare

for Margaret for one reason and one

reason only, and that is to pay for tax

breaks for the wealthiest people in our

society and the wealthiest corporations

in America.

Now something they did not show

you on the other side of the aisle, but

I will. It is a piece that was in the Wall

Street Journal after we passed the tax

bill. The Wall Street Journal said, and

I quote, ‘‘The tax bill could mean a

windfall for the well off,’’ and then it

goes on. ‘‘It could turn out to be the

biggest tax savings bonanza in years

for upper-income Americans.’’ Boy, you

bet it could turn out to be the biggest

income savings because indeed that is

exactly what is happening. And if you

are a wealthy corporation, you do not

have to pay any taxes at all.

The last time the Republicans were

in power, in the early 1980’s, if you

looked at the 250 largest corporations

in America, 130 of them paid no taxes

for at least 1 year; in the early 1980’s,

no taxes at all. It was such an outrage

that the people in this Chamber, Republicans and Democrats, even President Reagan, decided we would change

it we would change it so they pay at

least a minimum, and it became law.

And now in the bill that we passed less

than 2 months ago the Republicans

have repealed the law, and now major

corporations all over this country, the

largest ones, will get away without

paying any taxes at all, and you know

who is going to have to pick up the

rest.

Now did the Republicans target the

200 billion we dole out in corporate tax

breaks ever year? We dole out over $200

billion in tax loopholes to the largest

corporations in America. You want examples? A 4.3 billion every year in agricultural irrigation subsidies to the

largest corporate farmers in America;

1.2 billion a year in mining subsidies to

the mining companies for royalties on

public lands. And it is endless. Do they

do anything about that? No, they did

not touch it, did not touch it. The gentleman from Texas [Mr. ARCHER], the

chairman of the Committee on Ways

and Means, would not have anything to

do with it.

Now did the Republicans target the

billionaires who give up their U.S. citizenship in order to avoid paying taxes?

I know that sounds like who would do

that? We have people who have done it,

who have avoided paying taxes by giving up their U.S. citizenships, and they

are very wealthy people, and the drain

on the Treasury for those people over

10 years is about $3.6 billion I ask, ‘‘Can

you imagine giving up your citizenship

in order to avoid paying taxes?’’

The country in which Margaret and

others defended, these businesses, with

the hard work of men and women in

this country, provided for these millionaires and billionaires, and all of a

sudden they do not want to make their

fair share.

The Republicans could have gotten

rid of that, and they said no. They argued and protected these people, except

for five of them. Five Republicans said

this is outrageous. The rest, 225 of

them, stood up and said, ‘‘we’re for

you. No, indeed we will not touch your

tax break.’’ Instead they are targeting

senior citizens like Margaret.

And just do not take my word for it.

The New York Times revealed the contents of a secret memo that the Republicans circulated, and in that memo,

under the Republican plan Medicare