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Mr. TONKO. Mr. Speaker, the House will be taking up H.R. 2920 this week, the Statutory Pay-As-You-Go Act of 2009, otherwise known as PAYGO.
This bill, sponsored by our majority leader, the gentleman from Maryland (Mr. Hoyer), will renew our commitment to fiscal responsibility and protect core democratic values.
As the President said less than 2 months ago, the pay-as-you-go rule is very simple: Congress can only spend a dollar in one place if it saves a dollar in another. Just as families cut back on eating out at restaurants to pay for a new amenity, so too must Congress make difficult balancing decisions.
In fact, this rule was put in place when the country saw record deficits turn into record surpluses during the 1990s. It is no surprise to learn that when this rule was abandoned, we returned to record deficits that in turn doubled our national debt.
PAYGO legislation will reestablish this requirement that turned deficits into surpluses under the Clinton administration.
It is also critically important to pass PAYGO to ensure our fiscal health and stability as Congress considers health care reform legislation, a necessary item. We must be able to pay for this reform without unduly burdening our American taxpayers. To understand this critically important PAYGO legislation and the record deficits this country is facing, we must understand how we got here. We must move toward a more balanced budget which will initiate an era of fiscal responsibility and a stronger long term fiscal position. PAYGO is an important and critical piece of legislation in that process.
First, a number of factors have brought us to this cash-strapped position. Under the previous administration, the PAYGO principle was abandoned, reckless tax cuts were passed for the wealthy and two wars were funded outside of the budget process. On top of that, our economy has seen one of the most severe recessions since the Great Depression. Congressional efforts to get the economy moving again have proven to be fairly effective thus far, but they have come at a price.
Understanding these problems and the long term fiscal restraints, what does the PAYGO legislation do? It will require that all new policies reducing revenues or expanding entitlement spending enacted during a session of Congress be offset over 5 and 10 years. As Congress did in the American Recovery and Reinvestment Act, PAYGO will include an exemption for legislation designated as an emergency.
PAYGO will require any future extension of upper income tax cuts to be offset, as well as force a serious examination of wasteful subsidies in the budget and tax loopholes that can be eliminated to benefit more worthwhile programs. This means that PAYGO will force advocates of tax cuts to acknowledge the costs and show how they will be paid for, as well as ensuring that we can afford to fund America's most important priorities consistently for future generations.
Certain exemptions on discretionary programs funded in the appropriations process will be granted under PAYGO. These programs are the low income home energy assistance program, our Head Start program, Pell grants, the special supplemental nutrition program for women, infants, and children, and housing assistance.
PAYGO will also establish an enforcement mechanism in nonexempt mandatory programs at the end of year if Congress has not already paid for the cost of all legislation enacted during that given year.
Mr. Speaker, this legislation is a priority for the President. He understands, as we do, that we must balance short-term deficit spending for economic recovery with a commitment to restoring fiscal discipline in the long term. The large deficits that we inherited as a result of the reckless borrow-and-spend policies of the previous administration have put pressure on funding for important priorities such as health care, education and clean energy jobs. We must ensure that regardless of who is in power, PAYGO will be a powerful impediment to reckless tax cuts financed by debt.
Mr. Speaker, the people of our country elect us to come to Washington to represent them in the best way that we can. After years of unrestrained spending, budget gimmicks and rampant waste, as well as fraud and abuse in Federal spending, it is clear we cannot continue along that same fiscal path. We are in a deep fiscal hole. However, with the right tools, including a statutory PAYGO budgeting process, we can reverse this dangerous trend and begin to put the country back on a fiscally sustainable path.
Mr. Speaker, that is why I support H.R. 2920 and encourage our colleagues to do the same.
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