Floor Statement of Senator Judd Gregg on the Introduction of the Stop Over-Spending Act
|←Judd Gregg's Floor Statements||Introduction of the Stop Over-Spending Act
|Delivered on 22 May 2007.|
Madam President, I rise today to talk specifically about how we get our fiscal house in order as a nation and especially as a government. Just last week, the Congress passed--or at least the Senate passed and the House passed--a proposal for a budget which, unfortunately, fails the American people dramatically in the area of controlling spending and in the area of good tax policy. It creates a cascade. It is a Democratic budget that creates a cascade of new spending, hundreds of billions of dollars of new spending which will grow the size of the Government dramatically and which is, therefore, undisciplined in its approach.
It also proposes tax policy which will radically increase taxes on working Americans and have the effect of stifling what has been an extraordinary economic expansion, which in part has been a function of having a tax policy which understands that if you let people keep their money, they tend to be more productive with those dollars, they tend to go out and take risks, be entrepreneurs, create jobs, and as a result, the Federal Government gets more revenue because people creating these jobs pay taxes and we end up with more economic activity. We have had 72 months of growth, and we have created 7.4 million new jobs in this country, and that is a significant step in the right direction toward economic expansion.
But all that is at risk because we, as a government, tend to spend more than we take in, and we do not have in place a discipline necessary as a government to effectively manage our own house. This was reflected in the budget that was just passed, regrettably. Therefore, as we also look to the future, we are confronting a cost to the Government which is going to radically increase the expenditures of the Federal Government to a point where our children and our children's children will not be able to afford them.
In fact, just the cost of three programs alone--Medicare, Social Security, and Medicaid--by the year 2025, because of the retirement of the baby boom generation, will actually exceed the amount of money which the Federal Government has historically spent as a percentage of gross national product. So by about the year 2025, because of the retirement of the baby boom generation, three programs--Social Security, Medicare, and Medicaid--will absorb all the money that historically the Federal Government has spent, which means there will be no money left over for education, laying out roads, or environmental protection.
We will be in a position where our children, in order to bear the burden of those three programs, will have to pay a tax rate which will make it impossible for them to afford their own Government and will make their lifestyle significantly constrained. The pressure on them will be dramatic because the burden of taxes will exceed their ability to pay them and still maintain a quality lifestyle. Their ability to send their children to college, to buy a house, to have a good lifestyle, to have the luxuries which our generation has had will be constrained by the fact that the size of the Federal Government is growing out of control as a function of the retirement of the baby boom generation.
So these two events combined--the dramatic expansion in entitlement spending and the Democratic budget which was essentially grossly irresponsible in the area of spending on the discretionary side of the account and in the area of creating debt; it will add $2.5 trillion of new debt to the Federal Government over the 5 years of this budget--these two events combined are going to put a lot of pressure on our economy and on the well-being of our Nation.
A group of us believe very strongly that we need to put in place mechanisms in this Government which more effectively discipline the spending of the Government. So I am introducing today, along with 27 colleagues--and that is a fair number of cosponsors--the Stop Over-Spending Act, SOS. This bill has eight basic elements. I am not going to go through them all, but I wish to highlight the ones that are significant.
Basically, what this bill does is it puts in place disciplines which allow this Congress, if it desires to do so--all of these disciplines can be waived by 60-vote points of order, basically--if Congress desires to do so, it can limit the growth of the Federal Government to something that is affordable to the American people.
The most important discipline this bill puts in place is one over entitlement spending. Right now, we have nothing that controls entitlement spending. This bill says that if entitlement spending reaches a certain level of use of general funds of the Treasury--and most of these entitlement programs--Social Security, Medicare, and Medicaid--are not supposed to be overwhelming burdens on the general fund, the general fund being basic income taxes, not retirement taxes and health insurance taxes--if the burden of these programs exceeds a certain level, then there are mechanisms which allow us to take a second look at these programs to improve them, to make them cost-effective while delivering quality services.
In addition, this proposal puts in place caps, serious caps on discretionary spending so that we know that when you hit a certain level of spending and you are trying to exceed the amount of money the Federal Government should spend, there will be a 60-vote point of order before that can occur. That is only reasonable, that is only good budgeting, and it is something we need to have in place.
Unfortunately, the Democratic budget which was just passed essentially got rid of caps for the year 2009, 2010, and it puts them in place for 2008, but that is almost irrelevant because it raises them so high that there is no way anybody is going to hit those caps unless they are truly spendthrifts.
They basically add $200 billion of new spending over the next 5 years, and next year they dramatically increase spending, both through taking programs off the budget by declaring them emergencies, such as in the agricultural area, and putting them into the next year through advanced funding, which is a total gamesmanship, and then actually increasing the spending levels under the discretionary account. It is a grossly irresponsible cascade of new spending we see coming at us next year as a result of this Democratic budget. This Stop Over-Spending Act will try to discipline that in a more effective way, and it is time we did that.
In addition, it puts in place two very aggressive proposals to try to take a look at how we are managing the bigger programs of the Federal Government. One is a proposal which came from Senator Brownback which is a bipartisan commission on accountability and Federal review. It is basically a BRAC commission for all the Federal Government. So if we find programs that are overlapping--and believe me, there are an awful lot of overlapping programs in the Federal Government--if we find programs that are just not producing the results they are supposed to produce or which have served their time, which were supposed to be 3-year programs and they have been going on for 10, 15 years, we will have a mechanism where those programs can come back to the Congress and voted up or down, either they should be in place or not in place, the same way we approach managing the defense spending accounts through BRAC.
There is a second commission put in place which, again, has an automatic vote by the Congress, which is an attempt to address the most significant issue we have, which is this entitlement spending issue which was reflected in the chart I held up earlier. This is a commission which would be set up, which would be bipartisan, which would be Members of the Congress, and which would essentially take a look at these programs--Social Security and Medicare specifically--and see how we can improve them, see how we can make them work more effectively but see how we can make them more affordable for our children, and then in a bipartisan way, with an overwhelming supermajority, so there is no question that anybody will be gamed, everybody will be at the table, and nobody will be gamed, bring those proposals back to Congress and vote them up or down without amendment so that we know this commission, when it makes a report, will actually get action from a report.
The problem is that we get all these commissions and they produce wonderful reports and nothing happens. This commission will have something happening. It is a critical element. It is important.
If we don't get on this issue of mandatory spending, we will be irresponsible as a generation. We are the generation that created this problem, the baby boom generation. We are the generation governing today. Probably 80 percent of the people in this body are of the baby boom generation. And what we are doing is burying our heads in the sand and passing what we know is a huge problem--which is going to occur because all the people who are going to create this problem exist and they are going to retire--we are going to pass that problem on to our children and say: You figure it out, even though it is a problem we created. That is irresponsible.
As people who have obtained a position of governing in this country, we have an absolute responsibility to our children and our children's children and to this Nation's fiscal health to address this issue, and this commission is an attempt to do that. This Stop Over-Spending Act is an attempt to do just that.
In addition, the proposal includes biannual budgeting, which is something many people around here think will help us be more efficient in the way we approach the accounts of the Federal Government. It changes and reforms a lot of what are institutional mechanisms for the purposes of managing the day-to-day business of the spending of the Federal Government by putting in place baselines which are appropriate and limitations on the ability to spend money around here under reconciliation and limitations on the ability to raise taxes arbitrarily on the American people.
So it is a balanced approach. It has 27 cosponsors, and, quite honestly, if a percentage of these proposals were adopted, we would actually have some discipline around this place in the area of fiscal policy. We would be back on a path toward making sure we have a government that people can afford, while we still have a government that is delivering the services that people want. That should be our bottom-line goal.
It is an honor for me to have a chance to introduce this today, to be the primary sponsor of it, but I especially appreciate the support of my colleagues in signing onto this bill, which I hope will be considered or at least elements of this bill will be considered because we are running out of time.