Shared Sacrifice in Resolving the Budget Deficit-Continued

Floor Speech

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Mr. MERKLEY. Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. MERKLEY. I rise today to talk about the significant financial challenges our Nation faces.

It will come as a surprise to no one that the topic of greatest concern is jobs, jobs in partnership with how we manage our deficit and our debt so as to put America on a firm financial footing down the road, put American families back on a firm financial footing.

My mailbox is full from families who have a lot of concerns about the Republican plan for cutting programs that serve working Americans. It is a host of programs that are affected, but I pulled a couple letters to bring with me.

One is Linda writing from Canby, OR. She is a parent of a disabled young adult. She writes:

My daughter, Nicole, has cerebral palsy and other medical issues. She is dependent on my husband and I for her total 24/7 care. Medicaid is essential because it helps her with medical and dental needs and her mobility. If Medicaid is cut or reduced, many of the disabled will be forced to live in nursing homes or institutions, which as we both know would not be cost effective. Please vote against cuts to our Medicaid system.

Trudy from Keizer, OR, writes a very similar letter about her grandson diagnosed with Asperger's.

The mail goes on and on from citizens who are working-class Americans, have fundamental jobs, often with modest to no health care. They have children and they have grandchildren who will be profoundly affected by the choices we make on health care, the choices we make on education, and the choices we make in terms of creating jobs here in America. So this debate has enormous import for the success of our families, and in the context of that importance, we need to understand how we got to the point we are right now. So let's start with a 10-year view of what has happened. These statistics might come as a surprise to many of you because they are a little bit out of synch with some of the rhetoric we hear on the floor of the Senate.

Over the last 10 years, from 2001 to 2011, we have had a revenue decrease of 18 percent. So revenue has decreased by nearly one-fifth.

On nondefense spending, you will see no bar here either negative or positive; the change has been zero over a 10-year period, zero change. Those are the programs that affect working America, programs that affect unemployment, programs that affect food support, nutritional support, Head Start Programs, health care programs, and training programs so that people can get better jobs.

Then over here we have defense spending up 74 percent. Well, that is interesting because these three bars tell the story of decisions made during the 8 years of the George W. Bush administration.

Over here on revenue, we have breaks that were granted to the best off in our society and that have been fought for vigorously--the extension of those breaks--by some of my colleagues across the aisle. Breaks for the best off and revenues down over that 10-year period.

Over here we have the fact that decisions were made for two wars not funded by the American people. That is an anomaly in our history. When we go to war, we raise the funds to pay for it, but not during the irresponsible 8 years of the George W. Bush administration.

So it is not a surprise that we now have a deficit problem and that we now have a debt problem because concrete decisions were made. And these are only part of the story. The rest of the story is that deregulation of mortgages, leading to a vast tsunami of predatory mortgages on working Americans turned into securities that poisoned financial houses throughout the United States and, for that matter, throughout the globe, also contributed to blowing up the economy and driving down the revenue.

So concrete decisions from those 8 years have placed us where we are.

How do we address this shortfall? Well, let's start by looking at how the Republican budget has been laid out with three principal points. The first is to end Medicare as we know it. Well, this plan to create a voucher system in lieu of Medicare is one that, frankly, terrifies every senior citizen in America and every citizen who knows they will be a senior citizen, who knows they have been paying for years into a program with administrative costs that are far more efficient than the general insurance market. But the goal of the Republican plan is to dismantle that efficiency and throw people into the highly inefficient private insurance markets with a voucher that does not rise proportionately with health care costs. I don't think destroying the very successful program to provide Medicare and health care for our seniors is where we should be going. The second part of the plan is to do roughly $4 trillion in cuts to programs for working Americans. The third is to protect all of the programs for the best off in our society, the benefits for the best off.

I think most citizens understand that when we come to a time of national challenge financially, everyone should participate. There shouldn't be the sacred cows for the very best off while the workers are asked to pick up even more of the burden. In fact, let's take a look at a chart that displays how this functions.

The average tax rate in America is 20.7 percent. Let's take the richest 400 in America. The top 400, their average tax rate is 18 percent. Now, why do the richest 400 get the lowest tax rates? That is what Americans have a right to know. Why is it that the Republican plan is asking to cut programs for working America while protecting the bonus benefits for the best off in our society?

These richest 400 earn over $270 million per year--not collectively; that is their average income. Well, wouldn't all of us love to be in a situation where we earn even a fraction of $270 million a year.

And that structure, while reflected here for the top 400, is really a structure for the best off of a high array--a 5- to 10-percent array of the best earners in America.

So those three points--end Medicare as we know it, replaced with a voucher program, cut programs for working Americans, and protect programs for the best off--that is the Republican plan.

The chair of the Senate Budget Committee came to the floor this week with a very different plan, and that plan has the same savings the Republican plan has. Let's take a look at that.

Under this plan, the budget framework includes the same amount of deficit reduction as the House Republican plan--in fact, actually a little bit more reduction: $4 trillion versus $3.9 trillion. So both plans get towards the same objective of fiscal responsibility, but they go about it in very different ways.

First, the Conrad plan tosses away the Republican plan to end Medicare as we know it.

The second thing it does is it puts all spending programs on the table. So let's turn to that piece of the structure. Here we have the Republican plan, and it is all in direct spending cuts, touching none of the programs for the best off that have been carefully embedded in the Tax Code.

Now, every American understands this game: You can fund a project with a $10,000 grant or you can give a $10,000 tax credit that is in the Tax Code or you can give a tax deduction that is worth $10,000, also in the Tax Code--three different ways of accomplishing the very same objective. But the Republican plan is to say: Wait. Let's only do the first of those three strategies because the second and third strategy we have utilized to create the programs for the best off in America, and we don't want to touch those. We want to place this burden on working Americans.

Well, the Conrad plan says: That is not right. There needs to be a conversation about fairness. We know those best off pay the lowest tax rates compared to working Americans, as I just showed in that previous chart--just 18 percent. So the Conrad plan says: Let's take 50 percent of that effort to close the deficit and do it in direct spending, and let's take 50 percent by closing tax loopholes, cutting tax subsidies, cutting tax earmarks, and promoting fairness.

I came to the floor last week to talk about the bluegrass boondoggle. Now, that is not a lot of money in terms of the overall challenge we face as America--$120 million over 10 years--but to a working American $120 million is a lot.

That was a special provision inserted not for companies but for the owners. It was to the individual Tax Code for the richest Americans, millionaires and billionaires who own thoroughbreds. They get a special break the rest of America doesn't get. There is program after program such as that, inserted for the best off. The Conrad plan says all of this spending, whether it has been in the appropriations bill or it has been in the tax bill, is going to be examined. That is a fundamentally fair approach.

Let's look at that in a little more detail, look at what the Conrad budget does in terms of fair rates for the middle class. First, it provides the alternative minimum tax protection for the middle class. Second, it continues tax reductions for the middle class that we have currently. Third, it cancels the bonus breaks for the millionaires and billionaires. That is basic rate fairness.

In addition, it says let's take on those special tax subsidies and tax earmarks that my colleagues across the aisle have been so proud of inserting into the Tax Code to protect the best off in society. Let's examine them and if they do not meet the fundamental test of creating employment, contributing to fairness, and being more important than other programs compared against each other, then they should be eliminated.

In addition, let's take off on those offshore tax havens. There are so many setups in which companies have essentially false addresses in the Caribbean so they can transport their profits to a place where they pay no taxes. Those tax havens, in combination with abusive tax shelters, need to be ended. These are all part of tax fairness and taking on this very important challenge we have in terms of our national deficit and our debt and taking it on in a manner that strengthens the programs that need to be strengthened.

You will find the Conrad budget, in contrast to the Republican budget, says let's invest in education. We are in a knowledge economy world. We must invest in education if our economy is going to thrive and our children are going to be successful.

The Conrad budget, in contrast to the Republican budget, says let's invest in infrastructure. We are falling behind in terms of supporting infrastructure. China is spending 10 to 12 percent a year. Europe is spending 5 percent a year. America is spending only 2 percent and that is barely enough to repair our existing infrastructure. In fact, sometimes those repairs are falling short. I know our county officials and city officials will be glad to provide us with a list of how short we are.

The third area is the Conrad budget invests in energy. Why is energy so important? Because currently we are spending $1 billion a day, sending it overseas, basically as a result of our addiction to oil. When you send $1 billion overseas for oil, you do three things. The first is you create a danger to our national security because of the dependence for our energy on governments in the Middle East and other places around the world that do not share our fundamental interests.

The second is you create jobs overseas spending that money rather than creating jobs here in the United States. Let's spend that $1 billion a day here in the United States of America on red, white, and blue American-made renewable energy. Not only does our security improve but in addition we create the jobs here in the United States.

Third, by ending our addiction to oil we contribute to addressing the carbon pollution challenge faced around this globe rather than being part of the problem ourselves.

Let's not adopt a budget plan that ends Medicare as we know it and replaces it with a voucher program, that savages programs for working Americans, and that protects the programs for the best off in our society. Let's instead invest in energy, invest in education, invest in infrastructure, and obtain the same impact on our deficit but do it in a manner that builds our economy and builds American families. That is the type of program that Trudy from Keizer, OR, wishes to see, Linda from Canby, OR, wishes to see, and workers throughout the United States want to see because they know we should have a plan that creates jobs and builds the success of our families rather than doing the reverse.

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