The Budget

Floor Speech

THE BUDGET -- (Senate - March 04, 2008)

BREAK IN TRANSCRIPT

Mr. CORNYN. Mr. President, I congratulate the Senator from New Hampshire for his leadership as the ranking member of the Senate Budget Committee and somebody whom I think understands the complexities of the Federal budget better than just about anybody. I do not claim to have that same
level of understanding, but what I do think I understand is what works and what does not work.

I will cite as an example a story in today's Wall Street Journal comparing my State, Texas, to another State that I will not name for present purposes, and wondering why the economy is booming, why jobs are being created in Texas when jobs are leaving the other unnamed State. They cited three main reasons. One is the belief in the benefits of free trade and selling our goods and services overseas in a reciprocal free-trade arrangement. They cite lower taxes which provide more incentive for productivity. And they cite the fact that in Texas, you have a right to work without having to belong to a labor union. You can if you want to, but you don't have to in order to work. And I add to those three items, sensible tort reform, which has not only created a business environment in our State which says to employers: You are not prey for predatory activity on the part of the trial bar, but you are welcome in our State to create jobs. Yes, you are going to be held accountable, but we are not going to create a hostile litigation lottery which is going to chase jobs and employers out of our State.

A lot of those basic principles which have helped make my State, the State of Texas, such a welcoming State for economic growth and prosperity and creating jobs and opportunity apply to the Federal budget, too, about which I wish to talk.

Senator Gregg had this chart up which talks about last year's budget; frankly, things that were done last year that I hope we would have learned our lesson this year and will not repeat. For example, last year's budget anticipated a tax increase on the American people of $736 billion. One might ask: From where is that money going to come? Is Congress actually going to vote for a tax increase? We may recall that the tax relief that we passed in 2001 and 2003 was not permanent because we could not get sufficient votes to make it permanent, so it was temporary. A significant portion of that tax relief--the capital gains and the dividends reduction--will expire during this budget period. It will result, if it does expire, without Congress acting, in effectively the largest tax increase in American history--but here is the worst part--without a vote of Congress. In other words, by Congress's inaction, we will see the largest tax increase in American history, and that is part of the revenue that this budget that was passed last year anticipates.

That contradicts the lesson I mentioned a moment ago that we have experienced in my State. We don't have a State income tax. We have tried to keep taxes as low as possible. It just makes common sense. You don't have to have a Ph.D. in economics to understand that if you want more of something, then you reduce the burden of producing it through lower taxes, through less regulation, and less litigation. If you want less of something, then you increase taxes, you increase regulation, you increase litigation. To me, that is the lesson we have learned, not only in my State, as I mentioned, but also in the Congress as a result of the tax relief we did pass in 2001 and 2003. We have seen more than 50 straight months of economic growth with more than 9 million new jobs created in the United States since 2003. Was that an accident? Was it serendipity? No, it was a result of reducing the burden of producing income and allowing taxpayers to keep more of what they earn, and it resulted, coincidentally, in some of the highest levels of revenue to the Federal Treasury because more people were working. They were incentivized to work harder and, as a consequence, they ended up paying more taxes which generated more revenue to the Federal Treasury, bringing the deficit down over what had originally been projected.

Of course, keeping taxes low is part of the equation. The other part of the equation is spending. As Senator Gregg pointed out, this budget passed last year dramatically increased Federal spending. This is one of the hardest things Members of the Congress have to do because, of course, we have people coming to see us every day saying: Senator, I would like your help funding this transportation project or providing an appropriation to pay for this or for that. But the fact is, we need to be good stewards of the taxpayers' money, and we need to learn how to say no because it is in the best interest of our economy and, in the long run, it is in the best interest of the American people because when we increase spending, we grow the size of the Federal Government. As Government expands, individual liberty contracts.

In other words, the bigger Government is, the less freedom we have to do what we want, as long as it is lawful. And what that means in the economic sphere is we are going to generate more economic activity, more revenue, create more jobs and more opportunity in the process.

So greater spending, dramatically increasing spending, is exactly the wrong thing. We ought to cut spending, eliminate wasteful programs, particularly those--and I have spoken on this issue before. The Office of Management and Budget has a Web site called expectmore.gov. You can go there and see a thousand different Federal programs that have been surveyed by the Office of Management and Budget, 22 percent of which either there is no evidence that they are meeting their intended purpose or effective, in other words, or the Office of Management and Budget simply cannot tell. Those are exactly the kinds of programs, the kind of waste that ought to be eliminated to reduce spending so that we can spend where it is absolutely necessary on our national priorities. But eliminate that wasteful spending. This budget does not do that.

Then, I think the most, frankly, shameful part of this budget is its failure to step up and recognize our responsibility to our children and our grandchildren who are depending on us to make sure they are not left with a debt they have to pay but, rather, they are left with, hopefully, a better life and better opportunity than we as their parents and our grandparents had. I know that is what my parents wanted for me and my brother and my sister. They wanted at least as good a life as they had, hopefully better. That is what every parent and every grandparent wants for their children and their grandchildren.

What has this Congress done to make sure that can happen? Frankly, not much. Let me put it this way: not enough because what we see is a growing debt. This budget passed last year grew the debt by $2.5 trillion. I know it is hard to think in terms of trillions. I doubt there is a human mind that can really conceive of how big that is. I mentioned yesterday that a billion seconds ago it was 1976. We are talking about not billions but trillions--a huge amount of money.

This budget grew the debt by $2.5 trillion but, frankly, what this proposed budget we are going to take up next week will in all likelihood fail to address is 66--6-6--$66 trillion in unfunded liabilities of the Federal Government.

One might ask: We understand the budget deficit, but what is the debt? The deficit is the amount of money we overspend each year, but the debt is how much we owe to our children and grandchildren, the debt we are simply passing down to them by failing to fix the Medicare Program, failing to ensure that the Social Security Program is on a solid fiscal financial basis. The fact is, there is legislation that I hope will be offered during the course of this budget debate that a task force be created.

As a matter of fact, the distinguished Democratic chairman of the Budget Committee and Senator Gregg, as ranking member, have proposed a task force so we can finally roll up our sleeves and come to grips with this growing financial crisis and the debt we are simply passing on to our children and grandchildren.

I mentioned that $1 trillion is impossible, perhaps, for us to comprehend, but let me bring it down to a number that we all can understand; and that is $66 trillion in unfunded liabilities due to the Congress's failure to deal with this growing cost of entitlements--Medicare, Medicaid, and Social Security. If you divide that by every man, woman, and child in the United States of America, it comes down to about $175,000. So $66 trillion in unfunded liabilities, for entitlements primarily, boils down to $175,000 for every man, woman, and child, including the baby who was born last night. That baby was born into the United States--the most prosperous, the freest Nation in the
world--burdened by $175,000 of debt because that baby's adult parents and the people they elect to Congress have failed to take responsibility to make sure that baby would be born into a world of prosperity, opportunity, and freedom. Instead, the baby has been born into a world that has that freedom and opportunity but also is burdened by $175,000 in debt.

There are a lot of challenges that lie ahead, and I have other charts I won't bother the Members of the Senate with here today, but we have to have an important debate here as we write the Federal budget. I agree with the Senator from New Hampshire, this is not the President's budget. As a matter of fact, everybody knows what happens to a President's budget, whether it is a Democrat or Republican in the White House. It is basically ``dead on arrival'' at Congress. I could say it another way. The President proposes and Congress disposes the budget. But it is our responsibility to write that budget, and we should do so in a way that is fiscally responsible.

We should also do it in a way that addresses the real pinch that average Americans feel when they fill up their gas tank and find that gasoline is $3.25, $3.50 a gallon, on its way to $4 a gallon probably this spring; and when they find that their health care costs continue to go up year after year after year such that they have less and less disposable income. Those are the sorts of things we ought to be paying attention to--reducing taxes, eliminating the debt, taking responsibility for that, and taking care of those bread-and-butter issues that the American people care about, because those are the ones that impact their quality of life on a day-to-day basis.

Mr. President, I yield the floor.

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