Date: 1981-12-14
Speaker: ROBERT C. BYRD (democrat)
Chamber: S

Mr. President. on December 9. the U.S. Senate perpetrated the biggest sham In tle history of the budget process when It voted 49 to 48 to adopt a meaningless. nonbudget. when It adopted the Domenici amendment to the second budget resolution. Through this vote. the Senate also took the amazing step of committing itself to cut social security. defense. and other vital areas of Federal priority. The sponsors of the Domenici amendment have clearly given up on the administrations commitment to a balanced budget. They replaced their earlier trust In the administration with the Domenici amendment which employed a peculiar twist of language whereby the majority of the Budget Committee urged itself to produce a plan next March for fiscal years 1983 and 1984 that results In a balanced budget by fiscal year 19841fall to understand why the majority. party must ask itself to draft legislative language next Year. Since the makeup of the Senate and of the Budget Committee will be the same on March 31 as it Is now. what 4.ense did it make to approve such an amendment? Certainly. the amendment captured a few lines of newsprint. and a few seconds of television time. but what was the point of it? Are things any better today. than they were before this amendment passed? Are we any closer to a balanced budget in fiscal year 1984 now than we were a few hours before? Obviously. things are no better and we are no closer to a balanced budget. If this amendments only failing were that it was pointless. I would not be too upset. After all. I became used to such proposals from my good friends on the other side of the aisle during their long tenure as the minority. But while this amendment was pointless as a balanced budget assurance. it was pernicious in the example It set for future budget cuts. To quote from the amendment. it urged cuts in "all parts of the budget. including entitlement programs." Let me -repeat that. "Including entitlement programs." Well. we on our side do not intend to stand idly by as the most basic entitlement program--social. securityis cut. and our contract with this Nations elderly -is broken in two. After the. President assured the Nation he would- not seekcuts In social security. the majority Party nevertheless pushed through an amendment which would require such cuts. Let. us take a moment to consider what brought us to this terrible moment. Throughout the entire budget and tax Cutting Process. Democrats warned that we Would be heading for trouble--that the Presidents fiscal plan would not work. Yet. our colleagues on the other side of the aisle marched In lockstep with the administration. There was no attempt to achieve a workable program. Now the massive tax cut is in place. Massive deficits arc assured. .Let us review the history of this balanced budget fight for a moment. In January. the President will send us his fiscal year 1983 budget. As this weeks newspaper reports indicate. the administrations preliminary calculations are for a budget deficit of $109 billion In fiscal year 1982 rather than the $43 billion projection they gave us In September. For fiscal year 1984. the March. July. and September administration budgets predicted a balanced budget. but the new administration forecast projects a deficit of $102 billion. Of course. we will hear cries that these are only preliminary projections and that there will be signific~ant cuts to reduce these unacceptably high budget deficits. But there are two Important questions to be addressed. The first Is: Why are these deficit projections so much higher than those of March or July or September? .I believe the answer is that the administration Is finally bringing its economic forecast out of fantasy land. What concerns me now Is whether David Stockman or some other administration adviser will rework the economic forecast to make the deficits disappear. We know from Mr. Stockmans admissions In the Atlantic Monthly article that his first action as OMBI] Director was to change the computer model that correctly projected high deficits. Will he change the model again? Or has a balanced budget slipped forever from thiis administrations grasp? In September 1980. candidate Reagan promised the American people a balanced budget in fiscal year 1983 by cutting waste. fraud. and abuse. On September 21. 1981. President Reagan reaffirmed his belief In a balanced budget. saying: This Adm~nlstratiozi is committed to a balanced budget. and we ~will fight to the last vote to achieve it In 1984. A mere 7 weeks later. on November 6. the country was shocked to hear the President say: Ive never said anything but that It was a goal. And the eventual goal. whether It comes then [in 19841. or whether It has to be delayed or not. is a balanced budget. What are we to believe? What signal are we to follow? When this adrnnstration first took office and announced Its economic recovery plan. the American people were telling us to give the President a chance. Give him his programs they said. His program promised a balanced budget. a huge tax cut. and increased .defense spending. Well. Congress gave his Programs to himwe itesponded. we gave the President everything he said was necessary for his economic recovery plan. Central to that plan was the promise of a balanced budget in fiscal year 1984. and now that promise has been broken and abandoned. On November 16. the President said: I did not come here to balance the budgetnot at the expense of my taxcutting progam and my defense program. If we cant do It In 1984. well have to do It later. Now we have to ask: What is it the President wants? Will he ever balance the budget? The second question I must ask is: If the President does still want a balanced budget. how will that budget be balanced? I think $162 billion is too much of a "magic asterisk" even for David Stockman. but one can never be sure. On October 15. 1 submitted an amendment instructing OMB Director Stockman to reveal which budget cuts and which tax increases would be necessary to reach the administrations deficit targets of $43.1 billion in fiscal year 1982. $22.9 billion in fiscal year 1983. and a balanced budget in fiscal year 1984. This amendment. which was offered to the social security minimum benefit bill. asked nothing more than that the full picture be painted for the Congress and the American people. The amendment sought to flush out any future social security cuts which might be lurking undere the rubric of unidentified cuts. Unfortunately. it was made into a partisan matter and voted down on a straight party line vote. I would point out at this time that the first budget resolution for fiscal year 1982 includes an assumption that there will be unspecified COLA cuts of almost $5 billion in fiscal year 1982 and $7 billion in both fiscal years 1983 and 1984. On October 28. I introduced a bill which again directed the Office of Management and Budget to spell out the unIdentified budget cuts and tax increases necessary to reach the administrations deficit targets. There has been no action on that bill. On November 18. when the Senate was considering the Illfated continuing resolution. I offered a simple sense of the Senate amendment that the President should present a balanced budget for fiscal year 1984 and should detail the plan to reach that balance. Well. that sense of the Senate amendment was spared the opportunity of the veto when it was defeated on a party line vote of 47 to 50. If one of these amendments had breen adopted. there could be no socalled unIdentified cuts. There could be no vague language that would leave Congress or the American people in doubt as to what cuts would be necessary or what tax increases would be required in order to achieve a balanced budget in fiscal year 1984. It would all be ot on the table. for everyone to see and understand. for the Congress and the American people. so that they could clearly appreciate what cuts would be included and what tax increases would be required. The administration could not continue to pretend future proposals for savings. unidentified cuts. or magic asterisks can balance a budget. My concern about the blue smoke and mirrors which were being used to proJect a balanced budget began when the President transmitted his budget to Congress on March 10. Even at that time. there were disturbing signs. Most disturbing were the $74 billion in unidentifled cuts for fiscal years 1983 and 1984. Were magic asterisks the only way this administration could balance a budget? Last April. when more realistic economics were used by the Senate Budget Committee. three Republicans Joined Senate Budget Committee Democrats in opposing the fiscal year 1982 first budget resolution because it did not provide for a balanced budget in fiscal year 1984. Over the Easter recess. faced with the prospect of no fiscal year 1982 budget resolution. a new master budget plan developed which reduced fiscal year 1984 spending by $44.8 billion. coincidentally the exact amount necessary to balance the budget in fiscal year 1984. But even this doctored document contained unidentified cuts. In fiscal year 1983. there were $28 billion in unidentifled cuts and an incredible $35 billion in fisal yewr 1984. Although these unidentified cuts troubled me and my fellow Democrats. the worst was yet to come. because the administrations July tax cut bill. which slased $280 billion in revenues between 1982 and 1984. has proven to be a disaster. Not only is this tax cut an unfair transfer of wealth from middle to upper income citizens. but it put a balanced budget by 1984 out of reach. President Reagan said the Kemp/Roth tax bill "**Includes Just -about everything to help the economy. * * But we now find out from Mr. Stockman that it wa nothing more than a trickle down wolf in the sheeps clothing of supply aide economics. In September. the budget situation turned even more grim. The economy was not responding to the plan. As the bad news continued to mount. the administration announced another multiyear budget plan to bring the deficit to zero by 1984. Their fall budget plan included new spending cuts of $48 billion for flscal year 1984 on top of the $51 billion that had already been cut by the administrations reconciliation plaa passed in July. After the surprising vote on my October 15 amendment. I sent a letter to Director Stockman on October 29. The letter asked Mr. Stockman to answer two critical questions: t First. what are the amounts of "unidentifled" cuts for fiscal years 1982. 1983. and 1984 that are presently Inoluded in the Presidents Fall Budget Program? . .. Second. based on the economic and budget situation as you see it today. What is your best estimate of d Spending reductions and revenue increases that are necessary to maintain the Pall Budget Programs projected deficits of $4.1 g billion in ascal year 1982. $22.9 billion in fiscal yea 1983. and a balanced budget in t 11.ca4 year 1984? Although this letter was sent nearly g 5weeksago. I1 received no response untila December 4. Mr. Stockm ns letter. said t that there are $49 billion in unidentified savings in the administrations latest budget. He did not answer my question as to what budget cuts and tax increases are necessary to balance the budget by fiscal year 1984. Recent weeks have.brought some added pressures on Director Stockman. The Atlantic Monthly article confirmed the fear I had harbored all along. the fear that had caused me to offer legislation seeking clarification of the unidentified cuts and necessary tax increases assumed by the Presidents package. The article depicted David Stockman as dismissing this important matter of unidentified cuts. To him. the unidentifled cuts which held his deficit projections together were Just magic asterisks. Well. I supose magic asterisks have their place in a program that the Vice President once labeled "voodoo economics." Unfortunately. they have no place in the world of free market economics. The administration may have decided to abandon its balanced budget goal for 1984. but many of us have not. and the Senate should not. If we abandon this .roal. what Point of reference do our business and labor leaders have as they try to plan for the future? If we abandon this goal. I am afraid we are jeopardizing economic recovery. I ask unanimous consent that my letter to Director Stockman. his response. and a special report detailing the administrations flipflops on the balanced budget be printed in the RECORD.