Mr. President, I rise today in strong support of the amendment to the balanced budget amendment to the Constitution that has been offered by the senior Senator from Nevada, Senator Reid</b>, and others of us. The purpose of the amendment is to protect the Social Security trust fund from being looted as part of an effort to balance the budget.<p>
Mr. President, I think it is important for people to ask when we are considering a balanced budget amendment to the Constitution: What budget is being balanced? That is what this first chart asks. What budget is being balanced?<p>
In order to answer that question, I think it is helpful to go to the actual language of the balanced budget amendment that is before us. And if you look at the language, it says very clearly:<p>
Total receipts shall include all receipts of the United States Government except those derived from borrowing. Total outlays shall include all outlays of the United States Government except for those for repayment of debt principal.<p>
So, Mr. President, it is very clear that what we are dealing with with respect to the balanced budget amendment to the Constitution is that all of the moneys coming into Federal coffers are being jackpotted. They are all being put in the same pot. Whether they are trust funds or not trust funds, it is all being put in the same pot. And then we are going to look at those total receipts and compare it to total outlays.<p>
I prepared this chart. This is kind of the teapot of the Federal Government budget. It shows the revenue that goes into the pot, and the revenues are the individual income taxes that are raised. That provides about 45 percent of the revenue of the Federal Government. All social insurance taxes go into this pot, including the revenue that is taken out of people's paychecks every month that is supposed to be for Social Security. All of that money is going into the pot. Social insurance taxes are about 37 percent of the revenue of the Federal Government. Corporate income taxes go into the pot. That is about 10 percent of the revenue of our Government. All other taxes are 8 percent.<p>
And then we look on the other end of the ledger. We look at what comes out of the spending spout of the Federal Government. And here is the spending breakdown. About 22 percent of the outlays of the Federal Government go for Social Security, 16 percent is interest on the debt, 16 percent for defense, 14 percent for Medicare, 7 percent for Medicaid, and other, 25 percent.<p>
So one can see in the balanced budget amendment that is before us what goes into the pot is all of the revenue and what goes out the spending spout are all of the outlays.<p>
The problem with this balanced budget amendment is that in using all of the Social Security income in counting whether or not you are balancing the budget, Social Security is not contributing to the deficit. Social Security is in surplus. And Social Security is in surplus for a reason. The reason is to prepare for the time when the baby boom generation retires. Because then these Social Security surpluses are going to turn to massive deficits. And so the reason for accumulating surpluses is to prepare for the time when the baby boomers retire.<p>
The problem is, the money is not being saved. The problem is, under the balanced budget amendment that is before us, we are going to put into the Constitution of the United States that those Social Security surpluses, instead of being saved, will be looted in order to give us a balanced budget or contribute to balancing the budget.<p>
Mr. President, this chart shows, just over the 7 years that the balanced budget amendment is to lead us to a balanced budget, how much of the Social Security surplus will be taken each and every year.<p>
This is the amount of Social Security trust fund money that will be looted in order to balance the budget.<p>
In 1996, $73 billion of Social Security surplus will be taken. We can see each and every year those surpluses are mounting. They are increasing. Under the terms of the balanced budget amendment that is before this body today, unless it is altered by the Reid amendment, every one of these dollars is going to be taken. Every one of these dollars will be looted in order to contribute to balancing the budget. That is profoundly wrong, Mr. President.<p>
We can see, as I said, $73 billion of surplus from Social Security in 1996, $78 billion in 1997, $84 billion in 1998, $90 billion in 1999, $96 billion surplus in the year 2000, $104 billion of Social Security surplus in the year 2001, and $111 billion of surplus in the year 2002.<p>
Every nickel of that surplus taken, not to have a fund that is available when the baby boomers retire; but no, every penny taken in order to contribute to balancing the budget.<p>
Mr. President, let me just say that if any chief executive in this country stood up before his board of directors and announced that in order to balance the operating budget of the company, he was intending to loot the retirement funds that were held in trust for his employees, he would be headed for a Federal facility, and it would not be the Congress of the United States.<p>
I said the other day that this amendment, as drafted, the balanced budget amendment before Members, as drafted, would make the Rev. Jim Bakker proud. Remember Rev. Jim Bakker? He went to a Federal facility, the Federal prison. He went to Federal prison for fraud. The fraud he was conducting was to raise money for one purpose and to use it for another. That is precisely what is being contemplated in the balanced budget amendment to the Constitution that is before Members today. That is fraud. It is fraudulent to tell people you are raising money for one reason, namely, to build a trust fund surplus that is available for them when they retire, but on the other hand not to create the surplus at all but to loot the fund and to use it for other spending.<p>
We would be putting in the Constitution of the United States that that is what would be done. Mr. President, that is so profoundly wrong I cannot even fathom how those who have written this amendment think it ought to be included.<p>
There is not any financial institution in this country that would accept for one moment the notion that we should take trust fund moneys and use them to balance an operating budget.<p>
Mr. President, I showed the surpluses, $636 billion, that are contemplated under the balanced budget amendment that is before Members today to be used to help balance the budget over the next 7 years. That is a small part of the story. That is just the next 7 years. The real larceny, the real theft, the real fraud, is far in excess of $636 billion. That is just what will be taken in the next 7 years.<p>
We know Social Security is going to be running surpluses for much longer than the next 7 years. In fact, it will be running surpluses out past the year 2020. When we look at the projected size of the Social Security trust funds out until the time the baby boomers have retired and start to draw down those surpluses, what one sees is simply staggering.<p>
These bars on this chart show the Social Security surplus as it accumulates. It shows by the year 2000, there will be almost $1 trillion of surplus. By the year 2010, $2.1 trillion--not million, not billion--trillion. This is real money, 2.1 trillion of surplus; $2.8 trillion by 2015; $3 trillion of surplus by the year 2020.<p>
Mr. President, when the baby boomers go to the cupboard to get their surplus, their retirement, they will find the money is all gone. It has all been used. It has all been looted to help balance the rest of the budget of the United States.<p>
This will create a financial catastrophe for the future. That financial catastrophe will be when the baby boomers retire. Having been made a promise, they will find no one can keep the promise, because in order to pay back this money, the tax increases would have to be so draconian, or the cuts in benefits so draconian, that the people of the United States would simply revolt.<p>
Mr. President, this chart shows what has happened in terms of the growth of payroll taxes both for Social Security and Medicare from 1940 out until the present. What one can see is that these regressive taxes have been increased very dramatically over this period of time in order to make these funds supposedly add up.<p>
The problem again, of course, is that these increases, these increased taxes that have been levied on the American people, have been used. And they have been used to balance other parts of the Federal budget. Or at least to reduce the deficit of other parts of the Federal budget.<p>
One reason that this is profoundly unfair is because, in essence, what has happened is people are being taxed on their payroll, on the amount of their wage earnings, and they are having an increasing amount taken out. They are being told, `We are taking this increasing amount because we have to run a surplus; we have to get ready for the time when those of you who are in the baby boom generation retire.' That makes sense.<p>
Unfortunately, what we say and what we do are two completely different things. We are not running surpluses in order to prepare for the time when the baby boomers retire. Instead, we are taking that money, we are taking those surpluses, and we are using it to offset other spending. So, in effect, what we are doing is levying a regressive payroll tax and using part of it, the part that makes up the surplus, to fund the other operations of Government.<p>
In fact, 73 percent of all taxpayers today are paying more in payroll taxes than they are paying in income taxes. I think this may come as a shock to many people. It is true: 73 percent of all taxpayers are paying more Social Security payroll taxes than they are paying in income taxes. They are doing it because we have told them the money is needed to create surpluses to prepare for the time when the baby boomers retire. The fact is that that is not what we are doing. We are taking the Social Security surpluses, we are looting them, in order to reduce the deficit.<p>
Now we have a proposal before Members in the balanced budget amendment to the Constitution of the United States, the organic law of this country, that would take this practice and enshrine it in the Constitution of our country. I cannot think of anything more inappropriate than to put into the Constitution of the United States that we are going to take trust fund surpluses and use them to help balance the operating budget of this country.<p>
Mr. President, I come from a financial background. If anyone, as I was being schooled and taught how to properly manage finances, had told me, `You take trust fund money and you use that to balance other parts of a budget,' that person would have been run out of the financial institution because everyone understands that that is absolutely inappropriate.<p>
For Members to put into the Constitution of the United States that we will take trust fund surpluses and use them to balance the other parts of the budget is profoundly wrong. That is the reason the Reid amendment is so important, because it gives Members the chance to protect Social Security trust funds from being looted for other purposes.<p>
Mr. President, I do not know of anything more basic than this concept. I do not know of anything that is more important when we are considering a balanced budget amendment to the Constitution than to make certain the trust fund moneys, Social Security trust fund surpluses, are not looted in order to balance other parts of the budget.<p>
So, Mr. President, let me just conclude by thanking my colleague, Senator Reidfrom Nevada, for offering this amendment. There are others of us who have joined with him in offering this amendment, and I urge my colleagues to support it. I thank the Chair and yield the floor.<p></body>
