The Budget and the Affordable Care Act

Floor Speech

Mr. GARAMENDI. Mr. Speaker, today we have seen a remarkable event here on floor of the House. During this discussion that's so critically important to this Nation about the deficit and how we are going to deal with our budget, this House passed a bill that will actually increase the deficit, a bill passed today with the support of the Republicans to repeal a provision in the Affordable Health Care Act that will keep Americans healthy.

Healthy Americans don't need medical care, and I suppose the idea of the Republicans here is that they ought to get sick. You take a look at the wellness issue, part of the Affordable Care Act, it provided for numerous activities specifically designed to keep Americans healthy: blood pressure screening for adults, programs for children to avoid obesity, public health programs for vaccination so that our children and, indeed, our adults don't get sick. All of these programs in the wellness portion of the Affordable Care Act would be repealed by the action that the Republicans just voted on not more than a half-hour ago.

What in the world is going on here? What's this all about? Is it some sort of ideological spiritual thing to do what is not very smart?

The Affordable Health Care Act, which they like to call ObamaCare, has many, many provisions in it specifically designed to reduce the cost of medical care in America. If you are going to deal with the deficit, and we all talk about it here, you have got to deal with the cost of Medicare.

How do you deal with the cost of Medicare? Well, you deal with it by reducing the likelihood that seniors will get sick. You deal with it by reducing high blood pressure in seniors so they don't have strokes. One of the most expensive things that the senior population will endure is a stroke. It's not just the immediate medical care; it's the long-term effect of a stroke. So when we go out and we try to have seniors and those soon to be seniors have blood pressure checks, we reduce the cost of medical care in America. But I guess the Republicans don't see it that way.

They also see it in another way, and that is somehow they believe that we can reduce the cost of medical care in the Federal budget by terminating Medicare. It is unbelievable that the Republican budget would terminate medical care for seniors by terminating Medicare, a program that was started in 1964 to deal with the specific problem that seniors had at that period, and that was the inability to afford medical services. They would literally be into bankruptcy and poverty because they couldn't pay for their medical care.

So, in 1964, Lyndon Baines Johnson and the Democrats in this House and the Senate passed Medicare, one of the foundations of support for the senior population in this Nation. And yet in the Republican budget that will be on this floor later this week is the repeal of Medicare, the termination of it.

So I suppose this is the new way we ought to look at this issue. It's a tombstone. And what it is, it said, Medicare, 1965 to 2011, created by LBJ, destroyed by the GOP. Unbelievable.

Fortunately, today, when President Obama spoke to the Nation, he addressed this issue, and I will paraphrase what he said. He says it more as a professor. I guess I will just say it as a street fighter from California: No way, no how will, in his Presidency, Medicare be terminated.

Are you listening my friends on the Republican side? The President said ``no.'' We are not going down the path of terminating Medicare.

And I know that my caucus, the Democratic Caucus, will stand there with the President. We will fight any attempt any time, anyplace, anywhere that you or anybody else will put before this House a proposal to terminate Medicare. We will not allow it, and thankfully the President has the veto pen. He ought to go back and pull out the pen that LBJ used to sign the Medicare law in 1965 and put it to paper should, somehow, the Republican budget arrive on his desk with the termination of Medicare in it. It should not happen. It cannot happen. We cannot subject our seniors to the kind of poverty that existed prior to the implementation of Medicare in the 1960s. This is something that we will stand and fight on.

The President had also said today, as he laid out his solution for a $4 trillion reduction in the deficit, do not terminate Medicare and don't privatize Social Security. Laying it down. Not a line in the sand, but clearly a mark on the concrete. Social Security will not be privatized during his watch.

Thank you, Mr. President. And you know this, that the Democratic Caucus in this House will stand firmly with you, and we will fight every, every bill, every proposal to privatize Social Security.

Now, we know there is a budget problem. We know that there is a deficit problem here in the United States, and we know that it has to be addressed. The President has laid out two chapters in the Democratic proposal to deal with the deficit.

In his State of the Union speech, he made it clear that Federal expenditures needed to be frozen over the next 5 years, and today he took another step recommending specific reductions in various Federal programs, all to the good, and we will stand there with him and we will work on reducing those Federal expenditures.

For me, I have got one in mind, about $120 billion a year that we could save, $120 billion a year. Now, that's four times, three and a half times what is in the Republican continuing resolution that will be on floor this week.

How do you find $120 billion a year? End the war in Afghanistan. End the war in Afghanistan. Bring the troops home. Bring the money home. Balance our budget. Use that to solve the deficit, or spend that money on building those roads, those facilities here in the United States.

Let's talk about the deficit for a moment. Oh, yes. If you're going to talk about the deficit, you really ought to understand where the deficit came from. It didn't just come out of the blue this year. It didn't just appear during the Obama administration. The deficit is something that has built up over a long period of time here in the United States. When they say the deficit is $14 trillion and is going to increase, well, it's not if the President and the Democrats get their way. It will actually be reduced by $4 trillion.

However, as to the current deficit, where did it come from? From where did it magically appear? Who left us with huge deficits?

Let's take a look. Here are the facts.

This fellow over here, you may recognize him. He is Ronald Reagan. At the end of every year, the Congressional Budget Office makes an estimate of what is going to happen over the next 10 years. At the end of the Ronald Reagan period, his last year in office, the Congressional Budget Office, the nonpartisan Congressional Budget Office, made an estimate of the Federal budget situation. Where's the deficit? They estimated that, in the next 10 years, Ronald Reagan's budget and the programs that were put into effect during his period would create a $1.4 trillion deficit.

Now, those of you who are familiar with the history of the United States would know that George H. W. Bush--the senior--followed Ronald Reagan. At the end of his 4 years in office, again, the Congressional Budget Office made an estimate. It estimated, should the Bush-Reagan policies go forward, the deficit would be $3.3 trillion in the out years.

Then along came Bill Clinton. In the first 4 years of his administration, Bill Clinton put in place, if extended forward, policies that would deal with the deficit, such things as PAYGO--a word that's common in Washington, but I'm sure, out there in the great American public, people have no idea what ``PAYGO'' is. ``PAYGO'' was the law during the Clinton administration. It required that any bill passed by Congress had to be paid for with either higher taxes or cuts in some other program. In other words, it could not create a deficit. It could not add to the deficit.

There were other programs put in place, part of which I was responsible for implementing, and that was the reinventing of government. I was the Deputy Secretary at the Department of the Interior during those years, and we were told by the Clinton administration's Office of Management and Budget that you will reduce the expenditures of the Department of the Interior, and you will continue to do the same things. Only, you will do them better. Effective and efficient government. We reduced the number of employees in the Department of the Interior during those first 4 1/2 to 5 years by some 15,000 people--from 90,000 to 75,000 people. We performed all of the previous services as well and, in many cases, better. So it is possible to be efficient and effective in this process.

Anyway, Bill Clinton is now President, and he puts all of these policies in place. At the end of his Presidency, the Congressional Budget Office did what it always does, which is to produce an estimate of what would happen in the next 10 years if the same policies were to continue. Guess what would happen. What would happen is a $5.6 trillion surplus, enough to wipe out all of the American debt--no debt, no interest payments, everything paid off.

However, Bill Clinton was followed by George W. Bush, and immediately, in the very first year of the Bush administration, the Clinton-period policies, some of which were voted on by Republicans as well as Democrats, were terminated. Massive tax cuts were put in place not only in year one but in year two. Two wars were started--the Afghanistan war and the Iraq war--neither of which were paid for. It was the first time in American history that wars were not paid for but were, rather, borrowed. Who did we borrow the money from? China. From other foreign countries? Yes.

Anyway, you now had two massive tax cuts, two wars, and then the Medicare drug program, which was about $700 billion a year--not paid for but, rather, borrowed, not for 1 year but for every year on into the future.

Thirdly, there was a whole set of policies where the government simply stepped back and let Wall Street do whatever it wanted to do. What it wanted to do was to engage in reckless profiteering, resulting in 2007 and 2008 with the crash of the American economy, with the Wall Street crash of 2008, bringing the American economy to its knees, to the greatest recession since the Great Depression. Those policies added up to this rather massive red zone here of $11.5 trillion of deficit, estimated by the Congressional Budget Office, the nonpartisan Congressional Budget Office, which projected in the next 10 years, if the same policies continued, an $11.5 trillion deficit.

President Obama came into office in January of 2009. The day he arrived in office, the budget had a $1.3 trillion hole in it. He didn't create it, but he had to deal with it--a $1.3 trillion deficit handed to him by George W. Bush and his policies.

That's the history. Now we're trying to dig ourselves out of that hole. Properly said, when you're in a hole, stop digging. A wise policy. The President couldn't do that, and this Congress couldn't do that in the face of the most serious financial and economic crisis this Nation had faced since the Great Depression. So the stimulus bill was enacted, some $750 billion, and it worked. Despite all the rhetoric, the economists looking at that today, in the cool memory of the stimulus bill, said it worked; it saved this economy; it saved this Nation.

Every other industrialized country in the world did the exact same thing--stimulated their economies. Together, the American and the international economies were stabilized, and we began to slowly grow out of that great recession. We're not out of it yet. We've got to put in place policies that end the deficit, and that's precisely what the President talked about today.

The Republicans have put a proposal before us, and we'll vote on it this week, but it is not a proposal that will help America retain its eminence as the most dynamic, the most creative, the most innovative, and the most successful economy in the world, because of the policies that are in it. It will terminate Medicare, and it will significantly reduce those programs that create future economic growth.

I would like to just take a deep breath now and turn it over to my colleague from the great northeastern part of the United States.

PETER, would you join us and carry on this discussion.

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Mr. GARAMENDI. Let me thank my colleague from Vermont, Peter Welch, for this presentation on the tax policy. I think we probably would want to stay with that a few moments. I know my colleague from New York (Mr. Tonko) is here, and perhaps you would like to opine and to share with us your thoughts on these issues of the budget and how we can deal with the deficit.

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Mr. GARAMENDI. The chart that you and I shared a moment ago is up here next to me; and it clearly shows that we have seen a middle class in America that has seen very, very little progress over the last two decades and, instead, an enormous shift of wealth and income to the top 1 or 2 percent of the Nation.

There has been a 256 percent increase in income to the very wealthy, and as I said, it trumps all of the income gains by the rest of the economy. Those at the bottom saw maybe a 10 to 11 percent increase. The rest, very, very little.

I look up and I see my colleague, the gentleman from the great State of Oregon (Mr. Blumenauer). Thank you for joining us. We talked earlier today about the upcoming debt limit. Please join with us and share with us your thoughts on what we are doing here, what we shouldn't be doing, or should be doing.

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Mr. GARAMENDI. I thank you, and let's just do a colloquy here back and forth. You've talked about ways in which we can bend the cost curve for health care for all Americans, not only those on Medicare. It was in the Affordable Care Act, the health care reform. Our Republican friends like to call it ObamaCare because it actually would reduce the cost of medical services for everybody, whether you are in Medicare or Kaiser or anywhere else. And you mentioned four very, very important ways it does it. One is hospital readmissions, otherwise known as hospital infections. Our former colleague a week ago likely died of a hospital infection. The Affordable Care Act places a heavy burden on hospitals that have a high infection rate, or readmissions. It is a very, very expensive, deadly situation. It is just one of several ways in which the Affordable Care Act reduced over time the cost of medical services.

You were here on the floor. I voted ``no,'' you voted ``no'' on a bill that Republicans forced through this House that eliminates wellness. What in the world was that all about? Why would you ever eliminate wellness: obesity, blood pressure, proper eating, nutrition, public health, vaccinations--all of these things to keep people healthy. Healthy people don't cost money. They don't run up the price of medical services. So they want to repeal that, and I'm going, that makes no sense at all. You are actually increasing the deficit by doing that. And then they take it to the ultimate step of terminating Medicare.

This has become my favorite. It's the tombstone for Medicare. In the Republican budget is a proposal that would terminate Medicare for all Americans who are less than 55 years of age today. If you are 65, maybe it would continue on. But if you look at the totality of their proposal, it is the termination of Medicare and this is what we have. ``Medicare, 1965 to 2011, created by LBJ, destroyed by the GOP.'' Unbelievable. And along with it, a significant reduction in Medicaid, which in California we call Medi-Cal.

Your expertise, Mr. Blumenauer, on the health care issue and the experience in Oregon on how we can reduce the cost of medical care needs to be heard by every Member of this House. So if you would continue on and share with us this issue of medical services and how we can reduce the cost, save Medicare, and simultaneously addressing the deficit.

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Mr. GARAMENDI. Let me add to that and carry on a little piece of it.

The Republican budget, which we will be voting on here on the floor of Congress in the next 2 days, has provisions that are equally harmful to seniors and to wannabe seniors, people who want to get to be 65 or 67 years of age, and these are the Medicaid reductions.

In the proposal that the Republicans will bring to this floor, the Road to Ruin proposal, is a block grant to the States for Medicaid services. In California, we call it Medi-Cal. This is a program that provides benefits to the poor and those who cannot afford medical services because they are severely disabled, mentally disabled, or seniors that cannot afford services in nursing homes. The block grant is less than what is now available to nearly every State, and it is scheduled to be reduced in the years ahead, the purpose of which is presumably to deal with the deficit, but what it does is it takes that whole population of seniors, current seniors, and others who are currently served by the Medicaid program and puts them at risk. The effect will be to throw seniors out of nursing homes, seniors that are on Medicaid or Medi-Cal in California. It is the most onerous and hardhearted proposal I have yet seen. These are people that are in desperate need of services, services for the mentally ill, services for the severely disabled, services for seniors who are in nursing homes and who cannot afford the cost of nursing homes. That's another part of this provision in the budget.

What is happening here is a shift, a shift of costs from the overall American economy in the Federal budget to the individuals, not to the wealthy, not to those who have income, but rather to those who have so little. And it's not the only shift that's occurring.

Mr. BLUMENAUER. If we could just follow up on this for a moment, because you are talking about something that ought to concern each and every citizen. Medicaid. In your State Medi-Cal. We've had the Oregon health plan. There are other States that have variations on that. It provides health care, as you say, for our most vulnerable populations: the elderly, disabled, extremely poor people.

Mr. GARAMENDI. And the young.

Mr. BLUMENAUER. It is very cost effective. There are complaints that the benefits under Medicaid are actually very low, and it's hard for physicians and hospitals, medical providers, to deal with this. But by moving to a block grant that, as you say, it is designed to go down over time. And unlike the current system, which is sort of countercyclical, where the Federal Government has given more money in times of distress, which it's done to your State and my State in the last 2 years. If we hadn't got the extra payments from the Federal Government to help with Medicaid, I can't imagine what shape people would have been in in Sacramento and Salem, Oregon. The legislature would have just melted down. What this proposal is, is to continue this ratcheting down, no benefits when times are tough, and put States in a situation where too often they are either unable, or in the case of some States, unwilling to react. It's going to have a cascading effect.

You mentioned the problem that's very likely to emerge with people being literally tossed out of nursing homes. This is something that Americans need to step back and look at what is being designed as part of this very pessimistic road map that is going to have very serious negative consequences.

Mr. GARAMENDI. I thank you for that.

I am going to shift to another very, very important part of the Republican budget proposal, and that is their total unwillingness to deal with the reality of the revenues that the Federal Government needs in order to continue to provide all of the multitude of services that are part of a modern society: everything from defense to homeland security as well as the medical and social services that we have been talking about.

I'm going to put this up, it's a little cute, but I think it pretty much illustrates one of the profound problems in the Republican budget.

``What Do They All Have in Common?'' We've got the unicorn over there, we have Bugs Bunny, and then we have this thing that says the corporate tax rate, 35 percent, large corporations like Exxon. It's a fallacy. Large corporations and small corporations in America don't pay 35 percent corporate income tax. In fact, if one were to take a look at Exxon, in 2008 they had the largest profit of any company in the world. In 2009, they had a profit of about $19 billion and their effective tax rate, how much they actually paid in taxes, was zero. Not 35 percent. Not 30 percent. Not 25, not 20, not 15, not 10, but zero.

Now it happens that they're not the only corporation. The Republican proposal actually would make this situation worse. It would take this 35 percent and reduce it to 25 percent.

What are we talking about here? Why would we want to do that? Apparently they want to do that because they want to take their savings, Medicare, by terminating Medicare, Medicaid, by reducing Medicaid and all of the other savings, the savings that they presume they're going to get from abolishing the wellness programs, high blood pressure screenings and so forth, and on and on and on, and give it to the corporations.

Let's understand that American corporations currently get a tax break for sending American jobs overseas. American corporations currently get a tax break for oil drilling. The oil industry in the United States is the most profitable industry in the world. We just talked about ExxonMobil. All of the other oil companies in the last 10 years have had a profit of $947 billion, just under $1 trillion. Yet they continue to receive tax breaks in the order of $12 billion to $15 billion a year, of our tax money, handed over to the oil companies at a time when they are now charging us over $4 a gallon for gasoline.

And what is that all about? Well, it's all about the ability of the oil industry to maintain a subsidy, a tax break out of the American taxpayer's pocket, handed over to the oil company, and they've had that subsidy for nearly a century. I'm saying, enough of that. Bring that money back into the Treasury, use it for green energy, solar, wind, renewable energy, for research, use it for the things that we need to do, including reducing the deficit. But oh, no. Oh, no. They don't want to do that. Our Republican colleagues want to continue to give to the oil industry the kind of tax breaks that they have.

If that's not enough, our Republican colleagues want to make sure that this fellow, Donald Trump, he wants to be President, probably to maintain the extraordinary tax break that he presently has. The Republicans want to reduce the taxes for Donald Trump and for other billionaires, millionaires, from 35 percent to 25 percent.

You go, why should we do that at a time when we're taking money away from seniors, at a time when we're forcing the middle class to pay more, at a time when you're shifting the cost of all of these services to the middle class, at a time when you're going after the unions and trying to destroy the union movement in America? Why in the world would you give Donald Trump, why would you give billionaires, why would you give those people at the very tiptop of the American economy, those people that now control over 25 percent of all of the wealth in America, the top 1 percent of wage earners in America, why would you give them, not a 10 percent, it's about a 17 percent reduction in their taxes? It makes no sense at all.

We talk about shared sacrifice. The Republican budget proposal that will be on this floor later this week will not be shared sacrifice. It is, in fact, giving to the top of the American heap of all taxpayers, of all wealth, even more. I suppose it must be the trickle-down theory, that if these folks, if Donald Trump and the other billionaires and millionaires have more money, somehow jobs will be created. The fact is it doesn't work. Don't believe me. Take a look at the American economy from 2001 to 2009, the George W. Bush period.

George W. Bush started the first very year of his Presidency with massive tax cuts that created a 2-plus trillion dollar deficit and very few jobs. During the Clinton period, we ended with a $5.3 trillion surplus and the creation of over 22 million jobs, and the tax rate for Mr. Trump and for other millionaires and billionaires was 39 percent. It is, in fact, the history of America's economy that proves that you're not going to create more jobs by reducing the taxes for Mr. Trump and the like.

So what do these things have in common: a unicorn, Bugs Bunny, and the corporate tax rate of 35 percent? They are all fictional, every one of them.

I want to move now to another subject. I'll make this my last, and I'll make it kind of quick. If we're going to grow the American economy, we have to make the critical investments that are the foundation of economic growth in any and every country. Whether you are Singapore, whether you are China or any of the European countries, France or Britain, the United Kingdom or the United States, there are fundamental investments that the society has to make, and many of these investments are made through the general public's government. Let me just turn to those investments.

This is part of our Make It in America agenda, the Democratic agenda of rebuilding the great American manufacturing base. If America is going to make it, we must make it in America. We have to rebuild the manufacturing base of America. We can do it, but it's going to take critical investments. I want to just point them out here as we go through this and then compare these to the Republican proposal, the budget proposal that we're going to be voting on.

The first one is trade. Now, the Republican proposal doesn't deal with trade and goods because they're not going to do any more harm to it, but this is a fair trade policy. This is a policy of trade where we do not give away our manufacturing industry to places like China. I am sick and tired of going into Target or any other store in America and finding ``Made in China,'' ``Made in Europe,'' made everywhere but in America. Enough of that. We need to see ``Made in America'' once again on the store shelves in America.

In California, the California government--not my responsibility, I wasn't responsible for it at the time--when they go out and they build a new bridge from Oakland to San Francisco, a multibillion-dollar bridge, and they buy steel from China because it's 10 percent cheaper, I'm going, Stop it. Stop it. And so today, in the Resources Committee, I introduced an amendment.

Now it's ``Drill, baby, drill.'' It's our Republican colleagues who want to drill anywhere and everywhere and all the time. I think it's the wrong thing to do. We need to move to renewables. But if we're going to drill, then why don't we drill with American-made equipment? Why don't we require that those drilling rigs, those pipes, those technologies, the drill bits, the blowout preventers be made in America? I introduced that amendment. The Republicans brushed it aside saying they didn't want to go that way. Okay, fine. But we need, on trade policy, to make sure that our trade policy does not disadvantage American manufacturers.

Taxes. I just talked about taxes. Why in the world would the Republicans vote against a tax policy that actually is now law? We passed this last December. Why would they vote against a tax policy that would reduce--nearly eliminate--the tax breaks that American corporations get when they send jobs offshore? Why would you vote against that tax break that American corporations have? I don't understand it. It's over, at least partially over, there's more that needs to be done, and my Democratic colleagues and I are asking our Republican colleagues to work with us to eliminate the rest of those tax breaks that American corporations get when they send jobs overseas.

We talked about some other issues here. For example, last December, the Democrats pushed through, Obama signed a bill that allowed American corporations and businesses to write off 100 percent year one--this year--100 percent of capital investment so that we encourage American manufacturers to invest in America so that they can be more productive.

Energy policy, extremely important. We cannot any longer put our economy and our national security at risk to foreign oil producers. So I guess part of the ``Drill, baby, drill'' is to try to deal with that, but that's not going to solve the problem. We need additional and new energy sources, and that's where the green energy, the future energy comes in.

Don't take it from me. Talk to our American military. Talk to the Navy, the Air Force, the Army. They think way ahead, and they know that they cannot depend upon oil. They need to move to other sources of energy. They did it years ago. They had wind on their ships. Then they went to coal. Then they went to oil. They are now using nuclear power. But they also know

that many of their pieces of equipment--a jet airplane isn't going to have a nuclear reactor. So they want to free themselves from the grip of the petro dictators around the world and they want to be able to have energy made here in America. This is biofuels, advanced biofuels of all kinds.

We ought to follow the lead of our military here, and we must create energy projects that provide us with clean renewable energy, whether it's nuclear or the green energy: solar, wind, biofuels and geothermal, all the rest. So energy policy becomes extremely important.

Labor. It turns out, if one were to look at American economic history, you would be able to track the rise of labor in the thirties, forties, fifties and sixties tracking perfectly with the rise of the middle class in America. So as labor became more predominant in America, we saw the American middle class grow right along with the labor movement.

Beginning in the 1970s, we saw the decline of the labor movement. If you track the decline of the labor movement, you will find the decline of the American middle class tracking perfectly with the decline of the labor movement. Now we find all across the Midwest--in Wisconsin and Ohio--a major movement to take yet another shot at labor, to weaken labor or to destroy labor. In the process, you will find the further decline of the middle class of America should they succeed at that.

But this is more than just the labor movement. This is preparing the American worker to be competitive in a modern economy. This is education. This is job training. These are programs to retrain and to bring into the workplace workers who are prepared to deal with the modern machinery and the modern equipment that a well-placed and well-executed economy must have.

I want to move to the next one, which is, in fact, education. Earlier today, I met with the President of California State University, East Bay, part of my district in California.

And the president, Mohamoyad Qayoumi, who happens to be an Afghan, was talking about programs that they're putting in place in the East Bay of California, San Francisco Bay, to encourage the education of children--modern technology, using iPhones, using techniques in computer technology--so that the kids who are into these things in a big way will be able to learn, not going out and buying expensive textbooks every year that are out of date the next year, but rather to use online publications and be able to bring to the students all of the world.

I was going home last weekend, and I got a call from my wife. She said, Can you find a light bulb for the projector? It's out. We need a light bulb for the projector. I said, I just got off the airplane. I don't know what I'm going to do.

I got online, I punched up my Safari, and I looked for light bulbs. In a matter of moments, I found, not too far from the airport, a photo shop that had the light bulb.

The whole world is here. The whole world is available for a student who's just curious. You cannot help but be curious. All you need to do is get online, and you can find out everything about the world around us, anything you're into with science, and it turns out that this little piece of equipment, according to President Qayoumi, is also a tool for the teacher. The test can be taken on this. And in taking that test, the teacher immediately knows what the student does not know. And so the next day in class that could be dealt with.

I think I'm running out of time here, and I'm going to finish very, very quickly with intellectual property. This is the transition of all of the research into the manufacturing sector. Make It in America. We have to do this. We can do this if we have the right policies in place.

With that, I yield back the balance of my time.

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