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Mr. CARPER. It is ironic; this reminds me of our church. Every now and then our minister is going full steam and preaching to our congregation. He says: I know I am preaching to the choir, but even choirs need to be preached to.
In this case, the folks, ironically, on the floor--Senator Warner, Senator Collins, Senator Sessions, and I think myself and Dr. Coburn--there are probably no Democrats and Republicans more committed to figuring out how do we get better results for less money in everything we do. So even the choir needs to be preached to. We just had a pretty good sermon.
I have a couple of posters here I want to share. I think they might be of some interest and value in this discussion. I like to think of spending, as we are trying to rein it in and get it under control, in three elements. One of those is entitlement spending, which now is over 50 percent of what we spend in the Federal Government. It is growing. We have something called discretionary spending, which includes defense, and the domestic programs which are not entitlements, not Medicare, not Medicaid, not Social Security. Then you have got interest on the debt. That is pretty much it. That is pretty much it. If you look at, again, entitlement spending, Medicare, Medicaid, Social Security and other things that we are entitled to, it is over 50 percent and growing.
As it turns out, the part of our budget that is being squeezed is the discretionary spending. So about half of that is nondefense discretionary spending. That includes everything from transportation to agriculture, to housing, education, to homeland security, and a whole lot of other things as well. Then there is defense.
If you take a look at this chart, we find that this gray line here is actually nondefense discretionary spending. We start out in 1971. It is about 4 percent of spending as a percentage of GDP. Today it is about 4 percent as well. The budget that I believe we received from the House of Representatives actually--where they actually drop their spending is in that money. That includes workforce development, it includes education, it includes infrastructure--roads, highways, bridges, rail, ports, all of the above. It includes investing in R&D, research and development, through the National Science Foundation, National Institutes of Health, and creates among other things goods and services and products that we can sell all over the country and all over the world.
Under the House-passed budget, that money, instead of spending about 19 percent of our budget for nondefense discretionary spending, I think we would end up down around 4 percent for all nondefense discretionary spending--4 percent of our budget. That is not consistent with the priorities of many of us, including those on this side of aisle, include our own congressional delegation.
Here we have health care. This is good. Health care as a percentage of GDP. I mentioned Medicare as a percentage of our entitlements, including Medicare as a percentage of our budget, now is up over 50 percent and climbing. If you look at health care as a percentage of GDP in this country, we are the green line. What we see from 1961 down to about 2010, the green line keeps going up and up and up.
Today, health care as a percentage of GDP in this country is about 17, almost 18 percent. I think the next closest country is France. We are way ahead of anybody else. We are almost twice as high as the Japanese, for example. We spend about 17, 18 percent of GDP. They spend about 8 percent. They cover everybody. They get better results.
When you have health care, the big part of Medicaid spending, Medicare spending, in fact all of it, is growing as though it is toxic. Entitlement spending continues to grow. We have got to do something about that. The discretionary spending part of our budget has actually been going down over 40 years by a significant amount of money. Today it is less than one-third of our total spending, if you combine defense and nondefense nondiscretionary spending.
So what do we do about it? What we try to do about it in our side in the budget, created with a lot of input from Senator Warner, a lot of input from Senator Sanders on our side, great leadership by Senator Patty Murray, who is the chair of the committee--they have come up with a budget that is before us today that says: All right, we know we cannot continue to spend as we are doing. We have got to rein in the spending, not only on the entitlement side but also on the discretionary spending side. We need to raise some revenues.
They go back to take a page out of the Clinton playbook from, gosh, 12, 13, 14 years ago, when we had a big deficit--not as big as this. But they adopted a deficit reduction plan engineered by Erskine Bowles, the Chief of Staff. They did a deficit reduction plan in 1997 with bipartisan support that said: For every dollar of spending that we cut, we raise a dollar of revenues.
We ended up with four balanced budgets in a row. The budget that comes out of the Budget Committee is similar in that it is dollar for dollar, a dollar of deficit reduction on the revenue side, a dollar on the spending cuts. But unlike what happened 12 years ago--15 years ago actually--we do not get to a balanced budget. If there is a fault in the budget that has come out of the Budget Committee, while it reduces our publicly held debt as a percentage of GDP from 73 percent, 72 percent down to about 70 percent in 10 years--it stabilizes and starts to bring it down as a percentage of GDP--we still will have a budget deficit of over a half a trillion dollars 10 years from now. Is that good enough? No. We need to do better. In terms of entitlement program spending, we need to find ways to save more money. We need to do it without savaging old people and poor people. We need to do it in a way that preserves these programs for the long haul.
We were in our caucus. We had some good presentations from a few of the smartest people, health economists, doctors and so forth, that have been around. They gave us a whole bunch of good ideas on how to get better health care results for less money. We need to do that and more.
On the discretionary spending side, Senator Collins, who has previously chaired the Homeland Security and Government Affairs Committee--Senator Coburn and I have the privilege of leading it today. We focus literally every day as an oversight committee, trying to do oversight of the whole Federal Government, which is a whole lot for one committee to do. We do it in conjunction with the GAO. We work off their high-risk list, high-risk ways of saving money. Every few years they give us these great to-do lists for the Federal Government. We work on it in our subcommittee. We work on it with GAO. We work with OMB, Office of Management and Budget, we work with the inspectors general across the agencies of the Federal Government. We work with nonprofit groups such as Citizens Against Government Waste.
Our whole idea is to focus on wasteful spending, as we ratchet down the spending, figuring out where are we going to get good results and where are we not. In the programs where we get the kind of results we want, we fund them more or we reduce them less. If we are not getting the results we need, we close those programs, we reduce those programs. That is the way it ought to be. That is the way it ought to be. That is the way we are trying to do it.
Let me see if I have another chart here that might be relevant. When Bill Clinton was President in the last 4 years of his administration, they negotiated a deficit reduction deal with the Republican House and Senate in 1997, dollar for dollar, a dollar of revenue, a dollar of deficit reduction on the spending side. And for those 4 years we had a balanced budget, revenues as a percentage of gross domestic product. I think it was about 19 1/2 to 20 percent, right around 20 percent of GDP.
Last year, our revenues as a percentage of GDP were down around 16 percent, I think, between 15 and 16. Even with the fiscal cliff deal that was adopted earlier, we will be up to about 18 percent of GDP by the end of the 10-year period.
I would suggest there are three things we need to do here: No. 1, we can build on a plan that has come out of the Budget Committee. It is a good start but it is not the finish line. We need to find additional savings in the entitlement programs that do not savage old people or poor people and preserve these programs for the long haul.
We need, in addition to that, revenue. We can do that by closing deductions, loopholes, credits. We can means-test a bunch of stuff. But we need to come up with the revenue to get closer to 20 percent.
The last thing, really in conjunction with what Senator Coburn was saying, is we need to look at every nook and cranny of the Federal Government--every nook and cranny of the Federal Government, from A to Z, from Agriculture to Transportation and everything in between. We need to ask this question: How do we get a better result for less money in everything we do? It is not just the responsibility of our committee, Homeland Security and Government Affairs, it is not just the Budget Committee, it is every committee. It is all of us who can win this together. It is the administration. It is the taxpayers groups. We are all in this together. If we are going to get to where we want to be, that is a fiscally sustainable roadmap to the future, it has to be all hands on deck. It has to be those three things: entitlement reform, additional reform, and to really squeeze every dime on the spending side and move from a culture of spendthrift to a culture of thrift.
The budget resolution gets us going in the right direction. We are going to meet up in the House in a conference committee, their vision, our vision. That is where the real hard work begins. Out of that I hope we end up with a real focus on those three things. If we do and we can work together, and the administration and the President provide the leadership we need, we will get where we need to go in the future.
I yield back.
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