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Public Statements

The Economy and the Stability of the Middle Class

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Location: Washington, DC

Mr. TONKO. Mr. Speaker, the opportunity this evening for the Democratic Caucus in the House to address this budget and to go forward with a discussion on our stand on the issues and solutions that we're proposing is an important opportunity for us to be able to dialogue here amongst each other on the House floor and also to share that messaging with the viewing public.

Certainly, the general public out there is watching many of these proposals. They are concerned about the stability of the middle class. They're concerned about the economy, concerned about job creation.

We are now well into the 112th session of Congress. We watch as many weeks and months have passed without one single measure that would increase jobs in this country coming before the House. Nothing that deals with the economy, nothing that deals with the retention of jobs or the job creation situation has been produced here as legislation and voted upon on the House floor, a rather dismal track record when the clarion call, the message that resonated from the voting booth to these Halls of Congress on the Hill in Washington was very clear: Start growing the economy, stop shrinking the middle class, and people are concerned about the opportunities that will be passed by. As we walk through these very difficult times, it is about job creation and retention.

There's also a concern that there has been this very strong attempt to make the comfortable even more comfortable with the new Republican majority in the House. And we'll talk about that. Let's talk about it.

We have a situation where people will allow for corporate loopholes that cost our economy money. They'll allow for a continuation of millionaires and billionaires to receive tax cuts; they'll advance the reducing of Medicaid, where two-thirds of those dollars go toward sustaining the elderly in health care settings; and they want to end Medicare. And all of this is professed to be some sort of savings in Federal Government.

Well, that is only part of the story. The real truth is that these savings quickly dissipate. They're gone because they are used as payment for tax cuts for millionaires, handouts to the oil companies that sit on historic profit that has been realized, $1 trillion nearly in profit realized by the big oil companies of this Nation, and that is the vulgar outcome that has so infuriated the middle class.

As I travel to my district, I hear repeatedly about the concerns to end Medicare. People will say, we're not ending it, we're fixing it; that we're not really providing for an end, we're offering, at first what was a voucher, now it's called ``a transformation.''

Look, as we shift risk from the government to the individual senior household, we are ending a benefit that has lasted for some four and-a-half decades, that came about for the very reasons that seniors could not access an affordable health care plan, that there was cherry-picking going on, that only the easiest to insure would be covered, that those who might have come with some preexisting condition would be passed by, and where the notion of an affordable health care insurance premium, a policy that was unaffordable, was just beyond the grasp of our Nation's seniors. And so it's why the program grew in strength and popularity, and why it has provided stability for our Nation's seniors.

Now, when we look at what's happening here, we'll talk about the many dynamics, but there are those who professed very boldly that what we're doing here is exactly what the Congress has in terms of an insurance policy.

Well, Congress has about 72 cents of its premium costs covered. With this plan, with this voucher plan initiated in this Republican budget approved in this House, the Republicans suggest with their plan that it would be every 32 cents on a dollar covered with their voucher program. And just what guarantee is there that the senior who shops will, in fact, land a policy that will cover them? So it's very concerning.

We just recently did a mailing that informed people of the various reforms that are being proposed. We also solicited their input on what priorities they believe we should hold in our hearts and minds here as we move forward, and we've received a great supply of information already in the very infant days in responding.

As they come in, they keep growing more and more one-sided.

Let me just hold up what the first few days has produced. We have one pile here of speaking out against the Medicare end. This is one copy. We have yet a second pile all received in the first few days of people receiving their mailing. We saw those two bulky piles. This is the response in favor of. Well beyond 90 percent of the returns to date is: don't mess with benefits.

Now, mindful, when we were addressing the Affordable Care Act, when we were holding town forums, when we were holding some 3,000 to 4,000 forums across this country discussing the health care reforms, how to improve it, what exactly is included, what the priorities ought to be, there were clarion calls of ending Medicare, of death panels, and all sorts of risks to the seniors, and denying access and affordability. Well, we proved that that was not the case, that it was misinformation.

This one walks right into that argument, because it ends Medicare. It ends Medicare and it turns it into a voucher system, and it has everyone shopping in the private sector insurance market to get their coverage. We can't allow this to happen.

We have seen, since the initiation of Medicare, the growth in premiums in the private sector market, and that equates to some 5,000 percent. That's a huge increase. But there are friends out there that helped to bring the wrong candidates to this House, and I think it's time for them to come forward, as they believe, to get some sort of return on that investment.

Well, we cannot afford to have that investment come down onto the senior community, because we know it will be devastating. So we are going to continue to do battle to fight that Medicare issue. To end Medicare would be devastating to our Nation's seniors. Can we make it stronger? Absolutely. Can we provide more stability? Absolutely. That began in the ACA, the Affordable Care Act. We are going to continue to work on it. But seniors did not tell me--and I talked to my colleagues, they did not tell colleagues across this Nation: go back to Washington. We want to return to Washington. End our Medicare program. They said absolutely the reverse, and they knew they were benefited by it.

There are a number of others that attacked the middle class, working families of this country. We are going to work to make certain that there is not an attack on the middle class, because that attack drains worthy programs of dollars and then gets transferred over to payments for millionaire tax cuts, billionaire tax cuts, Big Oil handouts, and corporate loopholes to be paid for.

We are joined this evening by a very good friend who has entered the House this year as a freshman Member. He is the former mayor of Providence, Rhode Island. He now represents Rhode Island's First Congressional District. He has been an outspoken voice. I am impressed with David Cicilline's absolute impassioned voice to save Medicare. He has been outspoken on the House floor, and he has been outspoken in our caucus. It is a pleasure, Representative Cicilline, to have you here this evening to talk about this Medicare situation and perhaps what you are hearing in your district.

Mr. CICILLINE. I thank the gentleman for his kind words and for giving me an opportunity to be a part of this discussion tonight and for your leadership on your importance of preserving Medicare for seniors in this country. I hear from constituents in my district about the importance of strengthening and protecting Medicare.

To give you an idea of how important this issue is in Rhode Island, more than 170,000 Rhode Islanders rely upon Medicare for a reliable, quality, and low-cost hospital and medical insurance as well as prescription drug coverage. More than 65,000 seniors and people with disabilities in Rhode Island rely upon Medicaid coverage for their long-term care.

When I participated in the debate, and actually when I listened during the debate on this very floor about the Republican budget proposal and about what it did to Medicare, my friends on the other side of the aisle said this will strengthen Medicare. And I thought, how could they make that claim? Because I knew what their proposal did was ending Medicare as we know it, as a guarantee for people 55 and under; and it ended this important safety net and turned it into a voucher system for our seniors.

Now, I unfortunately no longer have my grandparents; they have all passed. But the idea that my grandmother or grandfather in their later years would have to go into the private insurance market and buy insurance because they would have lost the protection of Medicare is something which I think nobody should be prepared to accept.

What is even more disturbing is that what the Republicans passed in that budget when they ended Medicare as we know it also resulted in increased costs for our seniors. See, the difference is nothing in their proposal will reduce costs of health care. That's really

what we need to do. We don't need to shift the cost to our seniors and visit that problem upon them, because then they have the burden of enduring additional health care costs. We need to obviously eliminate fraud and waste and abuse, invest in wellness and prevention, invest in information technology, all the things that will drive down health care costs. But shifting the burden to our seniors should not be the answer.

The nonpartisan Congressional Budget Office--this isn't Republicans and Democrats. This is nonpartisan--they said that this Republican budget, which was passed by the Republicans, would actually increase health care costs for our seniors, provide less costs and be more expensive, and it would restore the doughnut hole and make prescription drugs more expensive for our seniors. And in addition to that, when you take their budget proposal in the aggregate, it would add $8 trillion to the deficit over the next 10 years. So it doesn't even reduce the deficit.

We all recognize we have got to reduce the deficit; we have to cut spending. We have to be serious about it, but we can't do it at the expense of our seniors, of protecting Medicare, strengthening Medicare so that our seniors have access to quality health care, and that's a responsibility that we have.

There are lots of ways that we have to look at every part of this budget, eliminate fraud and waste, get rid of programs that don't work, be serious about looking at our military spending and what is happening in Afghanistan; we are spending $2 billion a week or more than that now. Look at the billions of dollars that we are giving in subsidies to big oil companies. They proposed in their budget another tax cut for the richest Americans, the millionaires and billionaires. At the same time, we are ending Medicare as we know it. It is the wrong priorities. We can do better than this. Our seniors deserve better than this.

I thank the distinguished gentleman from New York for giving me an opportunity to share my observation that Rhode Island seniors are depending on me and this Congress to protect and strengthen Medicare. They expect us to deal with this deficit in a responsible way, be serious about budget cutting, but maintain our commitment to our seniors.

Mr. TONKO. Thank you, Representative Cicilline. And, again, thank you for your outspokenness, because we need to make certain that all of America is involved in this dialogue, because this is a critical tipping point in this Nation's history. We can raid on the middle class and cut domestic programs that feed their very heart and soul, or we can do it intelligently, where we share the pain.

Speaking of sharing the pain, a budget, as you indicate, is nothing more, nothing less than our values, our principles, our priorities. And we have seen where the priorities lie with the majority of this House. They have said it is about Big Oil first; it is about corporate loopholes first. It is about millionaires and billionaires first. The people now see this. They see this because they know they are going to have to pay two times what they pay today for Medicare coverage out of their pocket. They know it's shifting risk from government to the senior citizen household, the senior citizen individual. They know that, by the year 2030, triple the amount of money, plus the risk of going out there and making certain that you can find a carrier that will cover you, because they will put your coverage at the whims of the insurance company. If they want to cover some of your health care needs, they will. If not, they won't. And that is really what will ache here. What really happened was that we are taking this moral compass that has been expressed by a program like Medicare and denouncing it, saying that, look, go fend for yourself, find your program.

What I find most generous about my district seniors, and I'm certain this is across the country, coast to coast, they are saying: I'm not just talking about myself or my generation. I am talking about my children and grandchildren. We know what comfort, what security, what stability this brought our household.

What comfort does it bring to adult children to know that their relatives, their parents are sitting in a situation that is responding with dignity?

And when you talk about the principles, about the priorities, look at the road to ruin. They call it the ``path to prosperity'' with the Ryan plan with the Republican budget. The road to ruin, as I refer to it, really takes money from our seniors on Medicare, $4.3 trillion, that then goes and transfers itself over to, guess what? $4.2 trillion worth of benefits for Big Oil and millionaires and billionaires.

So the scales are balanced in terms of where the dollars are, but the real pain here is that they get emptied from the seniors' coffers, programs that address a basic core need of health care, and then get emptied into the pockets of millionaires and billionaires and Big Oil.

I know our friend from California, Representative John Garamendi, who is always leading us on the floor with wonderful, interesting discussion, has something to say about big oil companies, and it speaks to this flipping from one side of the scale to the other, where an equal amount of money found in savings by cutting the middle class, by cutting our seniors is now going to be spent. It is not savings. It was accruing the dollars necessary to just transfer over in some sort of way and some sort of painful way that finds itself with oil companies, millionaires and billionaires.

Representative Garamendi, please.

Mr. GARAMENDI. Mr. Tonko, thank you very much for what you are doing, bringing up this critically important issue. As you were saying, nothing is more important than the question of who we are as Americans and our values; what is it that we really care about and how do we structure, how do we create a society that reflects those values.

Before 1964, the largest segment of the American population that was in abject poverty were seniors. They had no health care. They couldn't get insurance. They were basically the poor of the poor. But as a result of the fundamental goodness of America, Medicare was created, a medical insurance program for seniors so that they would have available to them doctors' services and hospital services. And it worked.

Now, I was the insurance commissioner in California for 8 years, elected statewide by 34 million people to oversee, to regulate the insurance companies. And in that process we were looking and watching the Medicare program. It wasn't private insurance, but it was part of the health insurance system; and we knew that it worked.

It is exceedingly efficient. It works for less than 2 percent. You got a nationwide insurance policy. Wherever you are in America, you get the exact same insurance policy. Doctors know how to bill; hospitals know how to bill. It is efficient; it is effective. It works. More than that, it is an expression of the basic goodness of America.

I was surprised, shocked, angered when the Republican budget came forward and proposed that Medicare be terminated for all who want to live to the age of 65. Terminated. Ended. That wasn't all that the Republicans proposed. They proposed that not only would it be terminated, but that all future Medicare enrollees would be given a voucher worth about one-half the cost of insurance and told to go to the insurance companies and buy a policy.

Wait a minute. Wait a minute. Time out, Mr. Republican. Time out. What are you saying? You are going to take the population that has preexisting conditions--there are very few that are 65 years of age that don't have preexisting conditions--and you are going to turn them over to the most voracious sharks in this Nation, the health insurance companies? No way. No way. They are going to get chewed up, spit out and uninsured, or else charged a small fortune. This is the most un-American, the most inhumane thing that could be imagined for seniors, for tomorrow's seniors. We cannot let it happen.

Then, on top of that, in the very next breath they proposed to continue billions of dollars of subsidies, taking money literally out of the pockets of seniors and working men and women and giving it to Big Oil, who happens to have big profits, just as you have on your card up there. Not only Big Oil, but the wealthiest people in America, people whose incomes are $1 million, $10 million, $1 billion a year income, and give them an additional tax break, so that in 10 years it is $4 trillion of tax breaks to the big oil companies and those, not millionaires, but those whose annual income is in the millions. What is going on here?

Mr. TONKO. Representative Garamendi, if you will suffer an interruption and yield, you talk about those Big Oil profits. You talk about the trillions they are willing to spend. And then they have the audacity to say it is a spending problem.

Well, where are we spending? We are making the comfortable more comfortable. With those Big Oil handouts, up to 90 percent, according to studies released, up to 90 percent are going toward bonuses for executives in the oil industry--up to 90 percent. What quantifiable societal good is there from these handouts? They are mindless. And today, today, someone from the industry was quoted as saying to not offer these handouts is un-American. It is unbelievable.

Mr. CICILLINE. If the gentleman will yield, I think what is just shocking is that that claim was made today, and really what is un-American is to end Medicare. The reality is Medicare reflects our values as a country. We decided as a Nation that we wanted to ensure that our seniors in their final years, that they have lived a life and played by the rules, done what is right, that they can live with security and dignity and without the fear, the anxiety of worrying how they would have access to basic health care, because we decided as a country that we wanted to ensure, to guarantee that our seniors could live with dignity and with proper health care.

The idea of ending that and requiring them to go buy it with a voucher, that is un-American.

Mr. TONKO. Right. And when you look at the statistics, the median household salary for our seniors is $19,000; the average individual salary is $19,000. When you look at the onerous outcome of having to reach for thousands more dollars out of your pocket on a base of a median of $19,000, when we are looking at millionaires and billionaires getting even more assistance, that is spending. So let's not get off track here. It is spending.

Where are we going to invest? Investing in health care, a basic core need, when premiums in the last decade have risen over 130 percent and where the administrative costs of the private sector and insurance are higher, where they are much lower in Medicare, where the advertising costs aren't there, where we know we have had coverage. And now we are going: here is your voucher payment. It is not going to be indexed appropriately so that with time it becomes less and less valuable.

This is the kind of un-American behavior that we are witnessing here and that people get upset about saying they are lies, they are fear tactics. This is what is happening. It ends Medicare.

Once you remove the risk that falls with government and transfer it over to our Nation's seniors, you have ended the core principle. When you deny a given bit of certainty and stability to our seniors, you have ended Medicare. When you are going to inflate the cost of health care, you have ended Medicare. And we have now taken that money and transferred it over to the big oil companies.

Representative Garamendi.

Mr. GARAMENDI. Thank you for yielding. If you add to that destruction, the termination of Medicare, the way in which the Republicans have already voted for on this floor to end the Health Care Reform Act, which regulated the insurance companies and said the insurance companies could no longer discriminate based upon preexisting conditions, discriminate based upon age and whether you are a woman or a man, all of those protections that are in the health care reform law would be terminated.

So not only are you taking the Medicare program and ending it, giving the seniors a voucher that is perhaps half of the cost of a health insurance policy, you are eliminating the restrictions that were placed on the insurance companies for discriminating against people that have preexisting conditions.

So you've literally taken these people and thrown them to the sharks. On top of that, the rest of the proposal was to take the Medicaid program, which is health insurance for impoverished children, and give a block grant to the State that's worth about half of the cost, a $700 billion cut out of that program for children's health care, and you say, What's this? This is not us. This is not America. These are harsh, cruel programs that are being foisted upon the American citizens.

Mr. TONKO. Representative Garamendi, if you will, that Medicaid cut also will impact the Nation's seniors because when they're in institutional settings we know about 66 percent of the expenditure is for our seniors. Again, we understand the compassion that is required. We know the American spirit to respond to those who have served society so well. And in their golden years they need the assistance. But every attempt that is being made here, we have tried every which way to inform the public of the attack on Medicare, the attack on Social Security, to privatize Social Security. This is about giving Big Oil, big insurance companies, big banks more business. This is like cashing in on being good to some people here. That is not how this government should be guided. It should be guided on the principles of providing the basic core needs in a way that's most effective, most efficient.

We have even attempted--the House was addressing the Republican version of the budget. I introduced an amendment on the Budget Committee where I serve and presented it before the Budget Committee, and it went down by party vote to stop the attack on Medicare, to end Medicare. There was an absolute amendment that said, Let's pull out ending Medicare from your budget plan. It was denied. Then, I traveled to the Rules Committee and attempted once more before the bill came to the House, Let's stop the effort to end Medicare. It was denied at the Rules Committee again with the Republican majority at the Rules Committee.

So now we're visiting this situation. And the budget was approved in this House with this raid on the middle class and the attack on the values of the middle class, of working families. It is really disturbing that the most comfortable continue to get that effort made their way. And especially when history speaks--and speaks so abundantly well to us. It should resonate. When we put people to work with FDR's programs back years ago, decades ago, the result was 8.5 million people put to work and public projects built that still serve us well today. JFK investing in global technology to win the space race. Those are examples of things that worked. LBJ promoting a Medicare program. Now we're repeating this driving the car into the ditch scenario. Reaganomics and its trickle-down didn't work. The Bush II Presidency and its cuts to the millionaire, billionaire companies didn't work. Why would we revisit that as we crawl out of the most painful recession and propose ending Medicare--ending Medicare--denying dignity to our Nation's seniors and avoiding the fundamental responsibility of good government, efficient government, which is what I think the voters asked for in November, not this sort of pain.

Representative Cicilline.

Mr. CICILLINE. I thank the gentleman. In addition to that, the other part of the Republican budget that passed in this Chamber was also to restore the doughnut hole; to make prescription drugs more expensive for our seniors and to eliminate the free preventative care. I know, from talking to seniors in my own district, there are too many seniors faced with a choice of, do I buy my groceries, or do I buy the prescription drugs that are necessary to keep me healthy. No senior in America should be faced with that choice. And this bill, this budget that the Republicans passed, will raise prescription costs for our seniors.

Mr. TONKO. Thank you.

Representative Garamendi, we have about 4 minutes remaining in our one-half hour here of dialogue.

Mr. GARAMENDI. I'll take a lightning minute here.

It really comes down to a question of: Where do you stand? Who do you stand for? It's very, very clear. If there's ever a dichotomy and a clear opportunity to see where you stand, it is in the Republican budget. Let's be very clear. It terminates Medicare; gives seniors a voucher that is worth perhaps half of the cost of insurance; takes $700 billion out of Medicaid. And that is, as you said, the long-term care for seniors in nursing homes. And it continues the tax cuts for people whose income is millions, billions; continues the tax subsidies for Big Oil--$4 billion, $5 billion a year to companies that have made over a trillion dollars in the last decade. And just in this quarter, Exxon, $10.7 billion; Oxy, $1.6 billion; Conoco, $2.1 billion. This is one quarter, 3 months of earnings. Billions and billions of dollars. And then they want to continue.

Where do you stand? Do you stand for the working men and women, the seniors, those people that need to be able to get health care, or do you stand for the very, very rich and the big oil companies? The Republicans have made it clear. There's a difference here between where we stand as Democrats and where they stand as Republicans.

Mr. TONKO. Thank you, Representative Garamendi. I appreciate you and Representative Cicilline joining in this important half-hour of discussion. But I can clearly state that no one that I talked to in this House, no Representative, was hearing advocacy to end Medicare during our campaigns last year. I didn't hear one individual tell me that--senior, non-senior. I didn't hear anyone ask me to give more profits, more handouts, to big oil companies. I didn't hear one person say, Protect the corporate loopholes for corporations out there. I didn't hear anyone say, Hand more tax cuts to millionaires and billionaires.

I did hear, Make my budget work at home. I need the basics. I did hear, I can't survive with the situation as it is. I did hear, We need jobs. I did hear, Start growing our economy. Stop shrinking the middle class.

Well, evidently this majority was not listening.

There was anger--undeniable anger, understandable anger--that existed out there. But this is not this quantification that they were looking for. They did not want to see this as a result, as an outcome. I think we need to continue to fight this effort to end Medicare, and we're going to continue that fight.

With that, I thank the gentlemen for joining me in this half hour.

I yield back the balance of my time, Mr. Speaker.


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